The Hindu Business Line : SERC okays KSEB’s capital expenditure proposal

The State Electricity Regulatory Commission (SERC) has allowed the capital expenditure proposal of Rs 1,146.09 crore put up by the Kerala State Electricity Board (KSEB) for 2008-09, though it has expressed doubts whether it could be achieved.

SERC, in its order on KSEB’s Aggregate Revenue Requirement (ARR) for the year, has said that a review of the progress of the capital expenditure for the previous year showed a ‘grim picture’ of achievement, especially in the areas of generation and distribution. However, considering the requirement in the system, it has allowed the board’s proposal for the current year.

The board had originally proposed a capital expenditure of Rs 1,022.38 crore in the ARR for 2007-08, which was subsequently brought down to Rs 953.17 crore. Against the original estimates, the achievement till January 2008 was only 41 per cent with the generation sector clocking just 13 per cent.

In the ARR proposal for the current year, the generation sector has been allocated Rs 540.52 crore, while the transmission sector gets Rs 181 crore and distribution sector Rs 419.52 crore. In the area of generation, the allocation for ongoing projects is Rs 279. 05 crore and for new schemes Rs 111.95 crore.

Transmission

In the transmission sector, the capital works will include 18.61 km of 220 KV lines; eleven 110 KV substations and 134.80 km of associated lines; four 66 KV substations and 14.64 km of associated lines; and 26 numbers of 33 KV substations and 309.07 km of associated lines.

In the distribution sector, the capital works proposed are 3,000 km of 11 KV lines; 6,000 km of LT lines; installation of 2,000 distribution transformers; and providing four lakh new connections. The allocation for distribution is 8.5 per cent more than the previous year.

The commission, in its order, has pointed out that considering the tardy progress during 2007-08, additional borrowing proposed by the board for the year will not be required and hence the interest cost need not be allowed in full for the current year.

It also feels that the board should take up a review of the progress of capital expenditure, which should be submitted to it within a couple of months of the order.

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