Economy

Kassia opposes Bescom’s tariff hike request

Our Bureau Bengaluru | Updated on February 15, 2021 Published on February 15, 2021

Urges govt to entrust Bescom to public/private management

Karnataka Small Scale Industries Association (Kassia) has opposed the Bangalore Electricity Supply Company’s (Bescom) request to hike tariff by 139 paise per unit for all category of consumers, before the Karnataka Electricity Regulatory Commission (KERC).

“There is considerable scope for reduction in costs and improving efficiencies to set off the proposed additional expenditure by Bescom. Therefore the present tariff revision petition should be rejected,” Kassia argued before the KERC.

“In order to improve the efficiency of Bescom, the Commission may order it to call for competitive tariff bidding and the management of Bescom may be entrusted to a public/private lowest tariff bidder,” it added.

Bescom has stated that the gap for FY 2022 is ₹3,556.64 crore and hence has requested the Commission to hike the tariff. Kassia said “Revenue gap carried forward from FY 2020 equal to ₹1,559.37 crore is due to truing up. There is an increase in power purchase cost due to purchase of extra energy to feed to irrigation pumpsets, a subsidy category. Any extra purchase made for IP sets should be borne by the Karnataka government. It should not be loaded on to the consumers.” Also, there is increase in transmission charge to PGCIL.

“Second is the ARR gap for FY 2022 equal to ₹1,997.28 crore. The Commission should force Bescom to restrict its expenditures to the approved provision only. If that is done there will be no regulatory assets,” Kassia pointed out.

Opting private purchase

Kassia said the Commission has approved sales of 31,549.21 MU for FY2022. But Bescom has proposed purchase of 25,616.07 MU for FY22. HT consumers are leaving Grid and opting for private purchase. In order to prevent HT consumers leaving the Grid, tariff of HT consumers should be reduced by at least 100 paise per unit. Kassia further said ₹698.85 crores is due from the government installations as per Tariff Order 2020. The Commission is treating it as regulatory assets. It is wrong. It should not be loaded on to the Consumers. It should be recovered from the government.

Unauthorised IP sets

Referring to unauthorised IP sets, Kassia sait it is a drain on Bescom. 24,874 un-authorised IP sets of unknown capacity are yet to be regularised.

Energy intensive units like foundries, forging shops, heat treatment shops, blow moulding units and steel mills are under serious threat of closure, reduction in tariff is required to ensure survival of these industries in Karnataka.

“The present fixed cost of ₹220 per KVA should be reduced to ₹200 per KVA . due to depreciation. Under any circumstances Fixed cost should not be increased,” Kassia explained.

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Published on February 15, 2021
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