gescom - karunadu...ii c o n t e n t s chapter page no. 1 introduction 3 1.0 gulbarga electricity...

KARNATAKA ELECTRICITY REGULATORY COMMISSION

TARIFF ORDER 2016

OF

GESCOM

ANNUAL PERFORMANCE REVIEW FOR FY15

&

ANNUAL REVENUE REQUIREMENT FOR FY17-19

&

REVISION OF RETAIL SUPPLY

TARIFF FOR FY17

30th

March 2016

6th and 7th Floor, Mahalaxmi Chambers

9/2, M.G. Road, Bengaluru-560 001

Phone: 080-25320213 / 25320214

Fax : 080-25320338

Website: www.karnataka.gov.in/kerc - E-mail: [email protected]

http://www.karnataka.gov.in/kerc

ii

C O N T E N T S

CHAPTER

Page No.

1 Introduction 3

1.0 Gulbarga Electricity Supply Company Ltd., 3

1.1 GESCOM at a Glance 5

1.2 Numbers of Consumers, Sales in MU and revenue

details of GESCOM

5

2 Summary of Filing & Tariff Determination Process 7

2.0 Background for Current Filing 7

2.1 Preliminary Observations of the Commission 7

2.2 Public Hearing Process 8

2.3 Consultation with the Advisory Committee of the

Commission

9

3.0 Public Consultation – Suggestions / Objections

and replies

10

3.1 List of Persons who filed written objections 10

3.2 List of the persons, who made oral submissions

during the public hearing

11

4 Annual Performance Review for FY15 12

4.0 GESCOM’s Application for APR for FY15 12

4.1 GESCOM’s Submission 12

4.2 GESCOM’s Financial Performance as per

Audited Accounts for FY15

14

4.2.1 Sales for FY15 15

4.2.2 Distribution Losses for FY15 20

4.2.3 Power Purchase for FY15 20

4.2.4 RPO Compliance by GESCOM for FY15 23

4.2.5 Operation and Maintenance Expenses 24

4.2.6 Depreciation 28

4.2.7 Capital Expenditure for FY15 29

4.2.8 Prudence Check of Capital Expenditure for FY15 33

4.2.9 Interest and Finance Charges 37

4.2.10 Interest on Working Capital 38

4.2.11 Interest on Consumer Deposits 39

4.2.12 Other Interest and Finance charges 40

4.2.13 Interest on belated payment of power purchase

cost

40

4.2.14 Other Debits 41

4.2.15 Net Prior Period Charges 42

4.2.16 Return on Equity 42

4.2.17 Income Tax 43

4.2.18 Other Income 44

4.3 Abstract of Approved ARR for FY15 44

4.3.1 Gap in Revenue for FY15 45

5.0 Annual Revenue Requirement for FY17-19 –

GESCOM’s Filing

47

5.1 Annual Performance Review for FY15 & FY16 48

iii

5.2 Annual Revenue Requirement for FY17-19 49

5.2.1 Capital Investments for FY17-19 49

5.2.2 Sales Forecast for FY17-19 54

5.2.3 Distribution Losses for FY17-19 64

5.2.4 Power Purchase for FY17-19 66

5.2.5 Sources of Power 68

5.2.6 GESCOM’s Power Purchase cost and

Transmission Charges

70

5.2.7 RPO Target for FY17 74

5.2.8 O & M Expenses for FY17-19 75

5.2.9 Depreciation 79

5.2.10 Interest on Capital Loan 81

5.2.11 Interest on Working Capital Loan 83

5.2.12 Interest on Consumer Security Deposit 84

5.2.13 Interest on belated payment of power purchase

cost

85

5.2.14 Interest and Finance Charges capitalised 86

5.2.15 Other Debits 86

5.2.16 Net Prior Period Credit Charges 87

5.2.17 Return on Equity 87

5.2.18 Other Income 89

5.2.19 Fund towards Consumer Relations / Consumer

Education

90

5.3 Treatment of Regulatory Asset 90

5.4 Abstract of ARR for FY16 92

5.5 Segregation of ARR into ARR for Distribution

Business and ARR for Retail Supply Business

93

5.6 Gap in Revenue for FY17 94

5.7 Application for Additional Revenue Requirement

for FY17

95

6 Determination of Tariff for FY17 98

6.0 GESCOM’s Proposal and Commission’s Analysis

for FY17

98

6.1 Tariff Application 98

6.2 Statutory Provisions Guiding Determination of

Tariff

98

6.3 Consideration for Tariff setting 99

6.4 New Tariff Proposals by GESCOM 100

6.5 Revenue of existing tariff and deficit for FY16 102

6.6 Other Issues 135

6.6.1 Tariff for Green Power 135

6.6.2 Determination of Wheeling Charges 135

6.6.3 Wheeling within GESCOM area 136

6.6.4 Wheeling of Energy using Transmission network or

network of more than one licensee

138

6.6.5 Charges for Wheeling of energy by RE sources

(non REC route) to consumers in the State

139

6.6.6 Charges for Wheeling Energy by RE sources

wheeling energy from the state to a

consumer/others outside the State and for those

139

iv

opting for renewable energy certificate

6.7 Other Tariff related issues 140

6.8 Cross Subsidy Levels for FY17 144

6.9 Effect of Revised Tariff 144

6.10 Summary of the Tariff Order 145

6.11 Commission’s Order 146

APPENDIX 147

APPENDIX – I 189

v

LIST OF TABLES

Table

No.

Content Page

No.

4.1 ARR for FY15 – GESCOM’s Submission 13

4.2 Financial Performance of GESCOM for FY15 14

4.3 GESCOM’s Accumulated Profit / Losses 15

4.4 Approved & Actuals Sales for FY15 19

4.5 GESCOM’s Power Purchase for FY15 21

4.6 O & M Expenses for FY15 – GESCOM’s Submission 25

4.7 Approved O& M expenses as per Tariff Order dated

12.05.2014

25

4.8 O & M expenses of GESCOM as per Audited

Accounts for FY15

25

4.9 Allowable O & M expenses for FY15 28

4.10 Allowable Depreciation for FY15 – GESCOM’s

Submission

28

4.11 Statement showing the Capital Expenditure of

GESCOM for FY15

30

4.12 Approved Vs Actual Capital Investment 32

4.13 Gist of Prudence Check findings for FY15 34

4.14 Allowable Interest on Loans – FY15 38

4.15 Allowable Interest on Working Capital for FY15 39

4.16 Allowable Interest and Finance charges 41

4.17 Other Debits – GESCOM’s Submission 41

4.18 Allowable Other Debits 42

4.19 Allowable Return on Equity 43

4.20 Approved ARR for FY15 as per APR 45

5.1 Proposed ARR for FY17-19 47

5.2 Proposed Capex of GESCOM for FY17 to FY19 50

5.3 Category wise approved number of installations 63

5.4 Category wise approved energy sales 64

5.5 Projected Distribution Losses – FY17-19 – GESCOM’s

Submission

65

5.6 Approved and Actual Distribution Losses – FY10 to

FY16

65

5.7 Approved Distribution Losses for FY17-19 66

5.8 Consolidated requirement of Electricity as filed by

ESCOMs

67

5.9 GESCOM’s Proposal 67

5.10 Power Purchase Requirement allowed for the Control

Period FY17 to FY19

68

5.11 Abstract of Power Purchase of ESCOMs for the

Control Period FY17 to FY19

70

5.12 Approved Power Purchase cost of GESCOM for FY17 72



5.15 O & M Expenses for FY17-19 – GESCOM’s Proposal 76

vi

5.16 Computation of Inflation Index for FY17 77

5.17 Approved O & M Expenses for FY17 78

5.18 Depreciation - FY17-19 – GESCOM’s Proposal 79

5.19 Approved Depreciation for FY17-19 80

5.20 Interest on Capital Loans – GESCOM’s Proposal 81

5.21 Approved Interest on Capital Loans for FY17-19 82

5.22 Interest on Working Capital Loan for FY17-19 83

5.23 Approved Interest on Working Capital for FY17-19 84

5.24 Interest on Consumer Deposits for FY17-19 –

GESCOM’s Proposal

84

5.25 Approved Interest on Consumer Security Deposits for

FY17-19

85

5.26 Approved Interest and Finance Charges for FY17-19 86

5.27 Return on Equity for FY17-19 – GESCOM’s Proposal 87

5.28 Status of Debt Equity Ratio for FY17-19 88

5.29 Approved Return on Equity for FY17-19 89

5.30 Other Income – GESCOM’s Proposal 89

5.31 Approved Other income for FY17-19 90

5.32 Approved ARR for FY17-19 92

5.33 Approved Segregation of ARR – FY17-19 93

5.34 Approved Revised ARR for Distribution Business – FY17-

19

94

5.35 Approved ARR for Retail Supply Business – FY17-19 94

5.36 Revenue Gap for FY17 95

6.1 Revenue Deficit for FY17 102

6.2 Wheeling Charges 137

vii

LIST OF ANNEXURES

SL.NO. DETAILS OF ANNEXURES Page

No.

I Total Approved Power Purchase Quantum and Cost

of all ESCOMs for FY17

210

II Approved Power Purchase quantum and cost of

GESCOM for FY17

216

III Proposed and approved Revenue for FY17 222

IV Electricity Tariff – 2017 223

viii

ABBREVIATIONS

AAD Advance Against Depreciation

AEH All Electric Home

ABT Availability Based Tariff

A & G Administrative & General Expenses

ARR Annual Revenue Requirement

ATE Appellate Tribunal for Electricity

BBMP Bruhut Bangalore Mahanagara Palike

BDA Bangalore Development Authority

BESCOM Bangalore Electricity Supply Company

BMP Bangalore Mahanagara Palike

BST Bulk Supply Tariff

BWSSB Bangalore Water Supply & Sewerage Board

CAPEX Capital Expenditure

CCS Consumer Care Society

CERC Central Electricity Regulatory Commission

CEA Central Electricity Authority

CESC Chamundeshwari Electricity Supply Corporation

CPI Consumer Price Index

CWIP Capital Work in Progress

DA Dearness Allowance

DCB Demand Collection & Balance

DPR Detailed Project Report

EA Electricity Act

EC Energy Charges

ERC Expected Revenue From Charges

ESAAR Electricity Supply Annual Accounting Rules

ESCOMs Electricity Supply Companies

FA Financial Adviser

FKCCI Federation of Karnataka Chamber of Commerce & Industry

FR Feasibility Report

FoR Forum of Regulators

FY Financial Year

GESCOM Gulbarga Electricity Supply Company

GFA Gross Fixed Assets

GoI Government Of India

GoK Government Of Karnataka

GRIDCO Grid Corporation

HESCOM Hubli Electricity Supply Company

HP Horse Power

HRIS Human Resource Information System

ICAI Institute of Chartered Accountants of India

IFC Interest and Finance Charges

IW Industrial Worker

ix

IP SETS Irrigation Pump Sets

KASSIA Karnataka Small Scale Industries Association

KEB Karnataka Electricity Board

KER Act Karnataka Electricity Reform Act

KERC Karnataka Electricity Regulatory Commission

KM/Km Kilometre

KPCL Karnataka Power Corporation Limited

KPTCL Karnataka Power Transmission Corporation Limited

KV Kilo Volts

KVA Kilo Volt Ampere

KW Kilo Watt

KWH Kilo Watt Hour

LDC Load Despatch Centre

MAT Minimum Alternate Tax

MD Managing Director

MESCOM Mangalore Electricity Supply Company

MFA Miscellaneous First Appeal

MIS Management Information System

MoP Ministry of Power

MU Million Units

MVA Mega Volt Ampere

MW Mega Watt

MYT Multi Year Tariff

NFA Net Fixed Assets

NLC Neyveli Lignite Corporation

NCP Non Coincident Peak

NTP National Tariff Policy

O&M Operation & Maintenance

P & L Profit & Loss Account

PLR Prime Lending Rate

PPA Power Purchase Agreement

PRDC Power Research & Development Consultants

REL Reliance Energy Limited

R & M Repairs and Maintenance

ROE Return on Equity

ROR Rate of Return

ROW Right of Way

RPO Renewable Purchase Obligation

SBI State Bank of India

SCADA Supervisory Control and Data Acquisition System

SERCs State Electricity Regulatory Commissions

SLDC State Load Despatch Centre

SRLDC Southern Regional Load Dispatch Centre

STU State Transmission Utility

TAC Technical Advisory Committee

TCC Total Contracted Capacity

x

T&D Transmission & Distribution

TCs Transformer Centres

TPC Tanirbavi Power Company

TR Transmission Rate

VVNL Visvesvaraya Vidyuth Nigama Limited

WPI Wholesale Price Index

WC Working Capital

xi

KARNATAKA ELECTRICITY REGULATORY COMMISSION,

BENGALURU - 560 001

Dated this 30th day of March, 2016

Order on GESCOM’s Annual Performance Review for FY15 & Annual

Revenue

Requirement for FY17-19 & Revision of

Retail Supply Tariff for FY17

In the matter of:

Application of GESCOM in respect of the Annual Performance Review for

FY15, Annual Revenue Requirement for FY17-19 and Revision of Retail Supply

Tariff for FY17, under Multi Year Tariff framework.

Present: Shri M.K.Shankaralinge Gowda Chairman

Shri H.D.Arun Kumar Member

Shri D.B.Manival Raju Member

O R D E R

The Gulbarga Electricity Supply Company Ltd., (hereinafter

referred to as GESCOM) is a Distribution Licensee under the

provisions of the Electricity Act 2003, and has, on 15.12.2015, filed

the following applications for consideration and orders:

a) Review of Annual Performance for FY15 and approval of

revised ARR thereon.

b) Approval of ARR for FY17-19

xii

c) Approval for revision of Retail Supply Tariff, for the financial

year 2016-17 (FY17)

In exercise of the powers conferred under Sections 62, 64 and other

provisions of the Electricity Act, 2003, read with KERC (Terms and

conditions for Determination of Tariff for Distribution and Retail Sale of

Electricity) Regulations 2006, and other enabling Regulations, the

Commission has considered the applications and the views and

objections submitted by the consumers and other stakeholders. The

Commission’s decisions are given in this order, Chapter wise.

xiii

CHAPTER – 1

INTRODUCTION

1.0 Gulbarga Electricity Supply Company Ltd.,:

Gulbarga Electricity Supply Company Ltd., (GESCOM) is a Distribution

Licensee under Section 14 of the Electricity Act, 2003 (hereinafter

referred to as the Act). GESCOM is responsible for purchase of power,

distribution and retail supply of electricity to its consumers and also

providing infrastructure for open access, Wheeling and Banking in its

area of operation which includes six Districts of the State as indicated

below:

1. Bellary

2. Bidar

3. Gulbarga

4. Koppal

5. Raichur

6. Yadgir

GESCOM is a registered company under the Companies Act, 1956,

incorporated on 30th April, 2002. GESCOM commenced its operations

on 1stJune, 2002.

At present GESCOM’s area of operations is structured as follows:

O&M Zones O&M Circles O&M Divisions

xiv

Gulbarga zone

Gulbarga Circle

Gulbarga CSC Division

Gulbarga Rural-I Division

Gulbarga Rural-II Division

Sedam Division

Bidar Circle

Bidar Division

Humnabad Division

Yadagir Division

Bellary Zone

Bellary Circle

Bellary CSC Division

Bellary Rural Division

Hospet Division

Rural Division

Raichur Circle

Raichur CSC Division

Raichur Rural Division

Sindanoor Division

Gangavathi Division

Koppal Division

The O & M divisions of GESCOM are further divided into sub-divisions.

Each sub-division is having two to three O& M section offices.

The section offices are the base level offices looking into operation

and maintenance of the distribution system in order to provide reliable

and quality power supply to GESCOM’s consumers.

xv

1.1 GESCOM at a glance:

The profile of GESCOM is as indicated below:

1.2 Number of Consumers, Sales in MU and Revenue details of GESCOM in

FY15 is as follows:

CATEGORY

GESCOM

No. of

Installation

Sales in

MU

Revenue

in Rs.Crs.

Domestic 1967060 1028.56 501.03

Commercial 214538 310.72 238.63

Industrial 54670 1216.2 715.57

Agriculture 307315 3094.1 1234.9

Others 50427 482.12 435.09

Total 2594010 6131.7 3125.22

GESCOM has filed its application for approval of Annual Performance Review

for FY15, Annual Revenue Requirement (ARR) for FY17-19 and revision of

Retail Supply Tariff for FY17.

Sl.

No. Particulars Statistics

1. Area Sq. km. 43861

2. Districts Nos. 6

3. Taluks Nos. 31

4. Population lakhs 121.10

5. Consumers lakhs 25.94

6. Energy Consumption MU 6131.71

7. Zone Nos. 2

8. DTCs as on 30.09.2015 Nos. 75015

9. Assets Rs. in Crores 5570.80

10. HT lines as on 30.09.2015 Ckt. kms 54013

11. LT lines as on 30.09.2015 Ckt. kms 82574

12. Total employees

strength:

A Sanctioned Nos. 10330

B Working Nos. 4997

13. Revenue Demand Rs. in Crores 3125.22

14. Revenue Collection Rs. in Crores 2652

xvi

GESCOM’s application, the objections / views of stakeholders thereon and the

Commission’s decisions on the approval of Annual Performance Review for

FY15, ARR for FY17-19 and revision of Retail Supply Tariff for FY17 are

discussed in detail in the subsequent Chapters of this Order.

xvii

CHAPTER – 2

SUMMARY OF FILING & TARIFF DETERMINATION PROCESS

2.0 Background for Current Filing:

The Commission in its Tariff Order dated 6th May, 2013 had approved

the ERC for FY14 to FY16 and the Retail Supply Tariff of GESCOM for

FY14 under MYT principles for the control period of FY14 to FY16.

GESCOM in its present application filed on 15th December, 2015, has

sought approval for the Annual Performance Review (APR) for FY15

based on the audited accounts, ARR for the fourth control period i.e.

FY17-19 and revision of Retail Supply Tariff for FY17.

2.1 Preliminary Observations of the Commission:

After a preliminary scrutiny of applications the Commission had

communicated its observations to GESCOM on 1st January, 2016, which

were mainly on the following points:

Capital Expenditure

Sales Forecast

Assessment of IP set consumption

Power Purchase

Issues pertaining to items of revenue and expenditure

Other new proposals

Compliance to Directives

In response, GESCOM has furnished its replies on 11th January, 2016. The

replies furnished by GESCOM are considered in the respective Chapters of

this Order. Further, the Commission also held a validation meeting to discuss

the proposals of GESCOM on 10th February, 2016.

xviii

2.2 Public Hearing Process:

As per the Karnataka Electricity Regulatory Commission (Terms and

Conditions for Determination of Tariff for Distribution and Retail Sale of

Electricity) Regulations 2006, read with the KERC Tariff Regulations,

2000, and KERC (General and Conduct of Proceedings) Regulations,

2000, the Commission in its letter dated 1st January, 2016 treated the

application of GESCOM as petition and directed GESCOM to publish

the summary of ARR and Tariff proposals in the newspapers calling for

objections, if any, from interested persons.

Accordingly, GESCOM has published the same in the following

newspapers:

Name of the News Paper Language Date of Publication

DECCAN HERALD English 19/1/2016

&

20/1/2016

THE HINDU

VIJAYA VANI Kannada

UDAYAVANI

GESCOM’s application on APR of FY15, ARR for FY17-19 and revision of

retail supply tariff for FY17 was also hosted on the web sites of GESCOM

and the Commission for the ready reference and information of the general

public.

In response to the application of GESCOM, the Commission has received six

statements / letters of objections. GESCOM has furnished its replies to all

these objections. The Commission has held a Public Hearing on 4th March,

2016, at Gulbarga. The details of the written / oral submissions made by

various stake holders and the responses from GESCOM thereon have been

discussed in Chapter – 3 / Appendix to this Order.

2.3 Consultation with the Advisory Committee of the Commission:

The Commission has also discussed the proposals of KPTCL and all

ESCOMs in the State Advisory Committee meeting held on 10th March, 2016.

During the meeting the following important issues were also discussed:

xix

Performance of KPTCL / ESCOMs during FY15

Major items of expenditure of KPTCL / ESCOMs for FY17-19

Members of the Committee have offered valuable suggestions on the

proposals. The Commission has taken note of these suggestions while

passing the order.

xx

CHAPTER – 3

PUBLIC CONSULTATION

SUGGESTIONS / OBJECTIONS & REPLIES

3.1 In pursuance of the provisions of the section 64 of the Electricity Act,

2003, the Commission undertook the process of public consultation,

to obtain suggestions/views/objections from the interested stake-

holders, on the application filed by GESCOM for Annual Performance

Review for FY15, approval of ERC and ARR for FY17, FY18 and FY19

and approval of revised retail supply tariff for FY17 under the MYT

Principle. In the written submissions as well as during the public

hearing, the Stake-holders and the public have raised several

objections/ made suggestions, on the Tariff Application. The names

of the persons who have filed written objections and made oral

submissions are given below:

List of persons who filed written objections:-

Sl.

No

Applicatio

n No. Name & Address of Objectors

1 GB-01 Sri Radhakrishna S. Raghoji, President, Hyderabad

Karnataka Chamber of Commerce & Industry,

Kalaburagi.

2 GB -02 Sri Yagnanarayana M.N, General Secretary, Laghu

Udyog Bharati – Karnataka, Bengaluru.

3 GA-01 Sri K.B.Arasappa, Hon. Gen. Secretary, KASSIA,

Bengaluru.

4 GA-02 Sri Chandrakant Patil, Secretary, Hyderabad Karnataka

Environment Awareness and Protection Organization,

Kalaburagi.

5 GA-03 Sri Lokaraj, Secretary Federation of Karnataka

Chambers of Commerce and Industry, Bengaluru.

6 GA-04 Sri Ravindra. S Madamshetty, President, Kirana Bazar

Merchant Association.

7 AE-01 Sri P.N.Karanth, Kundapura.

8 AE-02 Sri Praveen Sood, IPS, Additional Director General of

Police, Administration, Bengaluru

xxi

3.2 List of the persons, who made oral submissions during the Public

Hearing, held on 04.03.2016.

SL.

No.

Names & Addresses of Objectors

1 Smt. Anuradha, BCIC

2 Sri Chethan Jain, IEx

3 SriDeepak G. Gala, Hyderabad Karnataka Environment

Awareness & Protection Organization & FKCCI.

4 Sri Siddaramaiah Hiremath, RTI Activists Association

Kalaburagi

5 Sri Deepak Nag Punneshetty, Former ZP President,

Kalaburagi

6 Sri Ramulu Reddy, Hyderabad Karnataka Chamber of

Commerce

7 Sri Vishwanath Avanti, KASSIA

8 Sri H.N. Kanihal, Kalaburagi

9 Sri Dr. Shailendra K. Bedale, Former ZP Member, Bidar

10 Sri Basavasanth Rao, Kalaburagi

3.3 The gist of the objections, Replies by GESCOM and the Commission’s

Views is appended to this order as Appendix-1

xxii

CHAPTER – 4

ANNUAL PERFORMANCE REVIEW FOR FY15

4.0 GESCOM’s Application for APR for FY15:

In its application dated 15th December, 2015, the GESCOM has sought

for its Annual Performance Review (APR) for FY15 based on the

Audited Accounts.

The Commission, in its letter dated 1st January, 2016, had

communicated its preliminary observations on the application of APR

by the GESCOM. The GESCOM, in its letter dated 11th January, 2016

has furnished its replies to the preliminary observations of the

Commission.

The Commission, in its Multi Year Tariff (MYT) Order dated 6th May, 2013

had approved the GESCOM’s Annual Revenue Requirement (ARR) for

FY14 – FY16. Further, in its Tariff Order dated 12th May, 2014, the

Commission had approved the APR for FY13 and had revised the ARR

for FY15 along with Retail Supply Tariff for FY15.

The Annual Performance Review for FY15 based on the GESCOM’s

Audited Accounts is discussed in this Chapter.

4.1 GESCOM’s Submission:

GESCOM has submitted its proposals for revision of ARR for FY15 based

on the Audited Accounts as follows:

xxiii

TABLE – 4.1

ARR for FY15 – GESCOM’s Submission

Amount in Rs.Crores

Sl.

No Particulars As Filed

1 Energy @ Gen Bus in MU 7870.42

2 Energy @ Interface in MU 7563.48

3 Distribution Losses in % 18.93

Sales in MU

4 Sales to other than IP & BJ/KJ installation 3008.64

5 Sales to IP & BJ/KJ installation 3123.07

Total Sales 6131.71

Revenue at in Rs Crs

6 Revenue from tariff and Misc. Charges 1853.65

7 RE Subsidy 1271.57

Total Revenue 3125.22

Expenditure in Rs Crs

8 Power Purchase Cost 2132.91

9 Transmission charges of KPTCL 289.52

10 SLDC Charges 2.61

Power Purchase Cost including cost of

transmission 2425.04

11 Employee Cost 276.47

12 Repairs & Maintenance 34.43

13 Admin & General Expenses 56.97

Total O&M Expenses 367.87

14 Depreciation 91.27

Interest & Finance charges

15 Interest on Loans 74.51

16 Interest on Working capital 86.70

17

Interest on belated payment of power

purchase cost 115.47

18 Interest on consumer deposits 35.11

19 Other Interest & Finance charges 0.97

20

Less interest & other expenses

capitalised 0.00

Total Interest & Finance charges 312.76

21 Other Debits 58.74

22 Net Prior Period Debit/Credit (5.99)

23 Return on Equity 54.83

24 Provision for taxation 0.00

25 Other Income 41.26

Net ARR 3263.26

xxiv

Considering the revenue of Rs.3125.22 Crores against a net ARR of

Rs.3263.26 Crores, GESCOM has reported deficit of Rs.138.04 Crores for

FY15.

4.2 GESCOM’s Financial Performance as per Audited Accounts for FY15:

An overview of the financial performance of the GESCOM for FY15 as

per its Audited Accounts is given below:

TABLE – 4.2

Financial Performance of GESCOM for FY15

Amount in Rs. Crores

Sl.

No. Particulars FY15

Receipts

1 Revenue from Tariff and misc. charges 1861.55

2 Tariff Subsidy 1263.67


Expenditure



5 SLDC Charges 2.61

Power Purchase Cost including cost of transmission 2451.68

6 O&M Expenses 367.90






11 Interest on belated payment of power purchase

cost 202.17




14 Net Prior Period Debit/Credit (5.99)

15 Other income 41.27

Net ARR 3235.08

As per the Audited Accounts, the GESCOM has incurred a loss of

Rs.109.86 Crores for FY15. The profits / losses reported by the GESCOM

in its audited accounts in the previous years are as follows:

xxv

TABLE – 4.3

GESCOM’s Accumulated Profit / Losses

Particulars

Amount in

Rs. Crs

Accumulated losses as at the end of FY10 (659.08)

Profit earned in FY11 (64.70)

Profit earned in FY12 39.75

Losses incurred in FY13 40.69

Profits earned in FY14 37.52

Losses incurred in FY15 (109.86)

Accumulated losses as at the end of FY15 (420.84)

As seen from the above table, the accumulated losses are Rs.420.84

Crores.

Commission’s analysis and decisions:

The Annual Performance Review for FY15 has been taken up duly

considering the actual expenditure as per the Audited Accounts

against the expenditure approved by the Commission in its Tariff Order

dated 12th May, 2014. The item wise review of expenditure and the

decisions of the Commission thereon are as discussed in the following

paragraphs:

4.2.1 Sales for FY15:

a) Sales other than IP sets:

The Commission in its Tariff order dated 12.05.2014 had approved total

sales to various consumer categories at 6204.94 MU as against the

GESCOM’s proposal of 6485.83 MU. The Actual sales of the GESCOM as

xxvi

per the current APR filing [FORMAT D2] is 6131.70 MU indicating a

reduction in sales to an extent of 73.24 MU with respect to the

approved sales. There is an increase in sales to LT-categories by 17.10

MU and there is a reduction in sales to HT-categories by 90.34 MU.

The Commission notes that, as against the approved sales of 3163.21

MU to categories other than BJ/KJ and IP sets, the actual sales

achieved by the GESCOM is 3035.45 MU, resulting in the reduction of

sales to these categories by 127.76 MU. Further, GESCOM has sold

3096.25 MU to BJ/KJ and IP sets category against approved sales of

3041.73 MU, resulting in increased sales to these categories by 54.52

MU.

The actual share of sales to categories other than BJ/KJ and IP sets is

49.50% as against the estimated share of 50.97% resulting in 1.47

percentage point reduction in share to these categories, while the

actual share of sales to BJ/KJ and IP sets has increased by the same

percentage point.

b) Sales to IP Sets:

In its Tariff Order dated 6th May, 2013, the Commission had approved

specific consumption of IP sets at 9,838 units/installation/annum for the

entire control period of the FY14 to the FY16, whereas, as per the IP sets

consumption reported by the GESCOM in its tariff filing, the specific

consumption works out to 9,946 units /installation/annum for the FY15,

which indicates an increase in the specific consumption by 108

units/installation/annum. The total IP sets consumption reported by the

GESCOM for the FY15 is 2,981.55 MU as against 2,924.50 MU sales

quantities approved by the Commission. The difference in IP sets

consumption between the approved and the actual for the FY15 is

57.05 MU. Thus, the specific consumption has increased by 108 units

/installation/annum with the corresponding increase in sales by a

quantum of 57.05 MU as compared to that of the approved quantum

by the Commission for the FY15. It is noted that the specific

xxvii

consumption achieved by the GESCOM for the FY15 has increased by

about one per cent. The specific consumption should not increase

over the years as it remains fairly constant given that the 11 kV feeders

are segregated as rural & agricultural feeders and the power supply to

agricultural feeders is also regulated. Further, it is also noted that the

power consumed by the IP sets can also be measured accurately on

the basis of energy meters’ data of such feeders at the substations

which was not possible earlier.

Further, the Commission had approved 3,02,919 as number of

installations likely to be serviced in the FY15; whereas the actual

numbers of installations serviced as reported by the GESCOM were

3,05,670, an increase by 2,751 numbers. This indicates that, around 0.9

per cent increase in number of installations serviced during the FY15

over the approved number of installations by the Commission. It is

noted that the increase in sales by 57.05 MU can be partly attributed to

increase in number IP set installations serviced under self-execution as

reported by the GESCOM, as compared to the projected number of

installations for the FY15. The increase in sales by 57.05 MU corresponds

to about 2 per cent over the approved figure for the FY15.

The Commission in its Tariff Order dated 12th May, 2014, had directed

the GESCOM to submit to the Commission every month, the IP set

consumption based on the energy meters’ data in respect of

agricultural feeders segregated under NJY, duly deducting the

distribution system losses. But, the GESCOM has not submitted the

metered consumption data of agricultural feeders every month

regularly to the Commission. The GESCOM in its tariff application has

also not submitted the metered data of IP sets in respect of the

agricultural feeders for the period from April, 2014 to March, 2015.

The Commission in its preliminary observations on the GESCOM’s APR

for the FY15, had directed the GESCOM to furnish the reasons for

increase in IP sets consumption, justifying with necessary data, for

claiming consumption of 2,981.55 MU for the FY15 and the

xxviii

methodology adopted to arrive at the energy loss figures in the 11 kV

distribution system. The GESCOM was also directed to furnish whether

the total IP sets consumption for the FY15 has been computed by

considering the specific consumption of agricultural feeders

segregated under NJY as directed or on the basis of readings obtained

from the meters fixed to sample DTCs feeding predominantly IP set

loads, the methodology followed up to the FY14 as per the approval of

the Commission.

The GESCOM, in its reply on the preliminary observations made by the

Commission, has stated that it has assessed the IP sets consumption for

the FY15 on the basis of readings obtained from the meters fixed to the

sample DTCs feeding predominantly IP set loads. Further, it has

informed that, the feeder- wise IP set consumption, based on energy

meters’ data in respect of agricultural feeders duly deducting the

energy losses in the distribution system has been submitted in Annexure

3(a) and 3(b) for the months from July to August, 2015 in the FY16 .

The Commission notes that, the GESCOM has not submitted the IP sets

consumption details on the basis of energy meter readings obtained

from the agricultural feeders segregated under NJY for the FY15,

despite achieving significant progress in commissioning of feeders

under NJY, instead, it has continued to consider the metered data of

sample DTCs feeding predominant IP set loads as per the

methodology approved by the Commission up to the FY14. The

Commission also notes that the GESCOM has submitted in its tariff

application the data of IP sets consumption in respect of 325

agricultural feeders for only two months in the FY16 and on the basis of

two months’ consumption data, it is not correct to compute the total IP

sets consumption as well as the specific consumption for the FY15.

Further, the Commission, during the validation meeting held on

10.02.2016 in the Commission, had also directed the GESCOM to

submit the IP set consumption on the basis of energy meter readings of

xxix

11 kV agricultural feeders which have been segregated under NJY. In

response, the GESCOM has submitted the details of IP sets

consumption based on the meter data of agricultural feeders

segregated under NJY. On verification of the energy consumption

data from agricultural feeders, it is observed that the distribution loss

figures reckoned to compute the net IP sets consumption in a feeder is

not based on actual calculation considering the distribution network

sketches.

The GESCOM is directed to calculate henceforth the actual distribution

losses prevailing in 11 kV line, DTCs and LT line as per the methodology

approved by the Commission for arriving at the net IP consumption.

For the present, however, considering the positive steps taken by the

GESCOM on this issue, the Commission decides to accept the sales to

IP sets for the FY15 as 2,981.55 MU, which is based on the readings of

energy meters of agricultural feeders, as submitted by the GESCOM

during the validation meeting on 10.2.2016 and also keeping in view

that only a slight variation in sales between the approved and the

actual.

Further, the GESCOM is directed to report the total IP sets consumption

on the basis of data from energy meters in respect of agricultural

feeders segregated under NJY duly taking into consideration the

distribution system losses prevailing in 11 KV lines, distribution

transformers and LT lines, to the Commission every month regularly.

The category wise sales approved by Commission and the actuals for

FY 15 are indicated in the table below:

TABLE – 4.4

Approved & Actuals Sales for FY15

Figures in MU

Category Approved Actuals Actuals - Approved

LT-2a 940.48* 913.86 -26.62

LT-2b 8.23 7.96 -0.27

LT-3 256.21 248.48 -7.73

LT-4b 22.07 9.76 -12.31

xxx

LT-4c 2.72 1.19 -1.53

LT-5 165.68 164.28 -1.40

LT-6 180.52 149.11 -31.41

LT-6 151.65 203.43 51.78

LT-7 23.16 15.23 -7.93

HT-1 81.03 77.92 -3.11

HT-2a 1145.03 1051.92 -93.11

HT-2b 63.17 62.24 -0.93

HT-2c 0 10.84 10.84

HT-3a & b 101.16 101.60 0.44

HT-4 17.80 12.68 -5.12

HT-5 4.30 4.95 0.65

Sub total 3163.21 3035.45 -127.76

BJ/KJ 117.23 114.70 -2.53

IP 2924.50 2981.55 57.05

Sub total 3041.73 3096.25 54.52

Grand total 6204.96 6131.70 -73.24 *Including BJ/KJ installations consuming more than 18 units/month

From the above table, the Commission notes that the major categories

contributing to the reduction in sales with respect to the estimates is HT

Industries (93.11 MU), LT Domestic (26.62 MU) and LT- 6 WS (31.41MU).

Further, it is observed there is increase in sales to LT-6 SL (51.78 MU) and

IP sets (57.05 MU).

Thus, the Commission approves the actual sales of 6131.70 MU for FY15.

4.2.2 Distribution Losses for FY15:

GESCOM’s Submission:

The Commission had approved distribution losses for FY15 as

shown in the table below:

Range FY15

Upper limit 19.50%

Average 18.50%

Lower Limit 17.50%

GESCOM has reported a loss level of 18.93% in its annual

accounts for FY15.

1 Energy at Interface Points in MU 7563.48

xxxi

2 Total sales in MU 6131.71

3 Distribution losses as a percentage of

input energy at IF points 18.93%


The distribution losses of 18.93% reported by GESCOM is based on the

sales of 6131.71 MU as against the energy of 7563.48 MU at interface

points. Considering the approved range of losses for FY15, the loss

levels reported by the GESCOM are well within the approved range of

losses. Hence GESCOM is not eligible for any incentive or levy of any

penalty during FY15.

4.2.3 Power Purchase for FY15:


The Commission in its Tariff order dated 12th May, 2014 had approved

source-wise quantum and cost of power purchase for FY15. The

GESCOM, in its application has submitted the details of actual power

purchase for FY15 for reviewing its Annual Performance. The details of

power purchase is listed as under:

TABLE – 4.5

GESCOM’s POWER PURCHASE FOR FY 15

Source

Actuals for FY15 Approved for FY15 difference of Actuals over

the Approved-for FY15

% increase /decrease

over approved figures

Energy in

MUs

Cost in

Rs Cr

Rate

in Rs

per

Unit

Energy in

MUs

Cost in

Rs Cr

Rate

in Rs

per

Unit

Energy

in MUs

Cost in

Rs Cr

Rate

in Rs

per

Unit

Energy Cost Rate

KPCL Hydel

Stations 2535.89 148.81 0.59 2494.15 144.58 0.58 41.74 4.23 0.01 1.67 2.93 1.23

KPCL-Thermal

Stations 1931.20 776.40 4.02 2010.09 765.51 3.81 -78.89 10.89 0.21 -3.92 1.42 5.57

Total of KPCL

stations 4467.09 925.21 2.07 4504.24 910.09 2.02 -37.15 15.12 0.05 -0.82 1.66 2.51

CGS 1733.26 549.25 3.17 1784.18 557.56 3.13 -141.04 -50.18 -0.04 -7.91 -9.00 -1.19

Major IPPs 291.28 122.99 4.22 349.15 159.41 4.57 -57.87 -32.02 -0.19 -16.57 -20.09 -4.21

IPPs -Minor

(NCE Projects) 383.27 137.38 3.58 679.53 257.15 3.78 -203.76 -76.47 0.01 -29.99 -29.74 0.35

Other States

Projects 19.59 5.06 2.58 25.75 8.2 3.18 -6.16 -3.14 -0.60 -23.92 -38.29

-

18.89

Short /Medium

term including

U I & Sce-11

661.62 328.90 4.97 572.15 298.44 5.22 89.47 30.46 -0.24 15.64 10.21 -4.70

xxxii

Source

Actuals for FY15 Approved for FY15 difference of Actuals over

the Approved-for FY15

% increase /decrease

over approved figures

Energy in

MUs

Cost in

Rs Cr

Rate

in Rs

per

Unit

Energy in

MUs

Cost in

Rs Cr

Rate

in Rs

per

Unit

Energy

in MUs

Cost in

Rs Cr

Rate

in Rs

per

Unit

Energy Cost Rate

Transmission

Charges

(KPTCL &

PGCIL)

350.26 346.97 0 3.29 0 0.95

LDC Charges

(POSOO &

SLDC)

0 3.76 0 -3.76 0 -100.00

Energy

Balancing

314.31 32.63 336.74 133.065 0

Others

Charges

0 0 0

TOTAL 7870.42 2451.68 3.12 7915.01 2541.57 3.21 -19.77 16.365 0.03 -0.25 0.64 0.90

Commission’s analysis and decisions;

1. The actual power purchase for FY15 as filed by the GESCOM for

approval of Annual Performance Review is 7895.23 MU at a total

cost of Rs. 2557.95 Crores, as against the approved quantum of

7915.01 MU at a total cost of Rs. 2541.58 Crores. As per the audited

accounts, the actual power purchase cost incurred by the

GESCOM is Rs. 2451.68 Crores. There is reduction in the quantum of

power purchase to an extent of 19.77 MU with an increase in the

cost to an extent of Rs. 16.37 Crores.

2. On an analysis of the source-wise approved and actual power

purchases, the following deviations in quantum of energy and its

cost of purchase are found:

i. As against the approved quantum of 7915.00 MU, the actual

power purchased by the GESCOM is 7895.23 MU for FY15,

indicating reduction in purchase of power by19.77 MU which is

about 0.25% of the approved quantum. During FY14, the

reduction was 5.77% and thus the accuracy of projection of

approved power purchase has increased from 94.23% to 99.75 %.

The reduction in sales reflected in reduced power purchase.

ii. On a verification of the source-wise power purchase, it is found

that, there is reduced energy supply from all the sources except

xxxiii

from KPCL hydel and also reduction in short-term purchase to an

extent of 487.72 MU involving a cost of Rs. 150.92 Crores.

Consequently, the GESCOM has purchased additional power on

Short-term basis over the approved to a tune of 89.47 MU

incurring an additional expenditure of Rs.30.46 Crores, resulting in

an overall increase in power purchase cost to a tune of Rs.16.37

Crores. Consequent to reduction in supply of energy from all the

sources except KPCL hydel and short-term, the power purchase

cost has increased by 3 paise.

iii. All these factors including the change in the source wise mix of

supply and reconciliation of energy and its cost among the

ESCOMs have resulted in increased average power purchase

cost of the GESCOM at Rs.3.24 per KWh, as against the approved

rate of Rs. 3.21 per KWh, leading to an overall increase by Rs. 0.03

per unit. During FY 14, the increase in per unit cost was 5.77 % i.e.,

Rs. 0.3 per unit. Now, for FY15, the increase in per unit cost is 0.25%,

only.

iv. D1 format of the GESCOM indicates the energy balancing

among other ESCOMs as 336.74 MU costing Rs.133.07 Crores

which tallies with Energy Balancing Statement of SLDC.

3. The Commission notes that, the SLDC is yet to implement the intra-

state ABT scheme. The Commission therefore directs SLDC to take

appropriate action immediately to expedite the implementation of

intra-state ABT scheme and to host such details on its website.

4. The Commission in its Tariff order dated 2nd March, 2015, had

directed the GESCOM to move the Government to effect

necessary adjustments in the tariff subsidy payable to the ESCOMs

and ensure that there are no inter- ESCOM payments outstanding

in their accounts. Further, GESCOM was also directed to reconcile

the inter-ESCOM exchanges and its costs duly making necessary

adjustments to ensure proper accounting of energy and its cost.

xxxiv

5. It is observed that, the ESCOMs’ balanced energy to an extent of

336.74 MU at a cost of Rs. 133.07 Crores has resulted in increase in

receivables of the GESCOM to an extent of Rs. 133.07 Crores in

FY15. This indicates that, out-standing payments related to the

inter-ESCOMs energy balancing and energy charges have not

been adjusted as per the directions of the Commission.

6. GESCOM is directed to reconcile the inter ESCOM energy

exchanges and its costs every month and the difference amounts

shall be collected/paid out of the tariff subsidy received from

Government of Karnataka, to ensure proper accounting of energy

and its cost.

7. In terms of the MYT Regulations, and taking note of the above facts,

the Commission decides to consider 7895.23 MU at a cost of Rs.

2451.68 Crores towards power purchase for approving the Annual

Performance Review of GESCOM for FY15.

4.2.4 RPO compliance by GESCOM for FY15:

GESCOM has submitted that its achievement of non-solar RPO and

solar RPO are at 4.60% and 0.39% respectively as against targets of 7%

and 0.25% respectively for FY15 as indicated below:

RPO compliance as submitted by GESCOM for FY15 Company

Name

Total

Input

Energy

(MU)

Non-Solar RPO Solar RPO

Target Achieved Target Achieved

(MU) (%) (MU) (%) (MU) (%) (MU) (%)

GESCOM 7896.10 552.72 7 363.33 4.60 19.74 0.25 30.64 0.39

The Commission has perused source-wise renewable energy purchase

data as submitted by GESCOM under D1 format of the Petition vis-à-vis

the RPO compliance data as submitted by GESCOM along with its

replies submitted.

The Commission has approved total power purchase quantum of

7895.23MU for FY15 in its APR. Thus, GESCOM was required to purchase

xxxv

552.67 MU of Non-solar energy and 19.74MU of solar energy to meet its

RPO targets. Based on the information furnished, the Commission notes

that GESCOM has purchased non-solar energy of 363.33 MU and solar

energy of 30.64 MU. Considering the surplus solar energy of 10.90 MU,

the net short-fall in non-solar RPO is 178.44 MU or 2.26 percentage point

for FY15.

The Commission notes that when the State as a whole is taken for the

purpose of assessment of achievement of non-solar RPO, in aggregate

all the State owned ESCOMs have achieved the total non-solar RPO

target set for the State. The Commission therefore decides not to

recognize the individual achievement of GESCOM and to treat the

matter as closed.

4.2.5 Operation and Maintenance Expenses:


The GESCOM has sought approval of O&M expenditure of

Rs.367.87 Crores for FY15. GESCOM has claimed the O&M

expenses as follows:

xxxvi

TABLE – 4.6

O & M Expenses for FY15 – GESCOM’s submission


Particulars FY15

Repairs & Maintenance 34.43

Employee Expenses 276.47

A&G expenses 56.97

O&M expenses 367.87


The Commission in its Tariff Order dated 12th May, 2014 had approved

O&M expenses for FY15 as detailed below:

TABLE – 4.7

Approved O&M Expenses as per Tariff Order dated 12.05.2014


Particulars FY15

No. of installations as per actuals as per Audited Accts 2670151

Weighted Inflation Index 6.89%

CGI based on 3 Year CAGR 4.34%

Actual O&M expenses for FY13 364.39

Total Approved O&M Expenses for FY15 433.70

As per the Annual Audited Accounts of GESCOM for FY15, the actual

O&M expenditure is as follows:

TABLE – 4.8

O&M Expenses of GESCOM as per Annual Audited Accounts for FY15


Repairs & Maintenance 34.43

Employee Expenses 276.47

A&G expenses 57.00

O&M expenses 367.90

The Commission in its preliminary observations made on the O & M

expenses had sought the details of the items of expenditure incurred

by the GESCOM during FY15 under A & G expenses. The GESCOM in its

replies has stated that, it has incurred expenses of Rs.23.43 Crores

towards professional charges, Rs.11.07 Crores towards conveyance

travel and vehicles expenses besides other A&G expenses. On

xxxvii

detailed review of the expenses, it is observed that the GESCOM is

incurring substantial expenses on vehicle hire charges and professional

charges.

Also, the R&M expenses are also increasing year on year without

proper justification. One of the major items observed under R & M is

expenses incurred on repairs of distribution transformers. The GESCOM

needs to institutionalize a mechanism for minimizing such expenses.

These expenses are abnormally increasing as compared to the

previous years. Since the O & M expenses are controllable expenses,

the GESCOM has to initiate necessary measures to ensure prudence in

incurring these expenses. The Commission is of the view that the

GESCOM should control its O & M expenses as per the approved O &

M expenses, so as to ensure that the actual O & M expenses does not

exceed the approved levels. However, for the present, based on the

provisions of the MYT Regulations, the Commission has proceeded with

determining the normative O & M expenses.

Considering the Wholesale Price Index (WPI) as per the data available

from the Ministry of Commerce & Industry, Government of India and

Consumer Price Index (CPI) as per the data available from the Labour

Bureau, Government of India and adopting the methodology followed

by the CERC with CPI and WPI in a ratio of 80 : 20, the allowable

inflation for FY15 is computed as follows:

Year WPI CPI

Composite

Series Yt/Y1=Rt Ln Rt

Year

(t-1)

Product [(t-

1)* (LnRt)]

2003 92.6 107 104.12

2004 98.72 111.1 108.624 1.04 0.04 1 0.04

2005 103.37 115.8 113.314 1.09 0.08 2 0.17

2006 109.59 122.9 120.238 1.15 0.14 3 0.43

2007 114.94 130.8 127.628 1.23 0.20 4 0.81

2008 124.92 141.7 138.344 1.33 0.28 5 1.42

2009 127.86 157.1 151.252 1.45 0.37 6 2.24

2010 140.08 175.9 168.736 1.62 0.48 7 3.38

2011 153.35 191.5 183.87 1.77 0.57 8 4.55

2012 164.93 209.3 200.426 1.92 0.65 9 5.89

2013 175.35 232.2 220.83 2.12 0.75 10 7.52

2014 182 246.9 233.92 2.25 0.81 11 8.90

A= Sum of the product column 35.36

xxxviii

B= 6 Times of A 212.19

C= (n-1)*n*(2n-1) where n= No of years of data=12 3036.00

D=B/C 0.07

g(Exponential factor)= Exponential (D)-1 0.0724

e=Annual Escalation Rate (%)=g*100 7.24

For the purpose of determining the normative O & M expenses for FY15,

the Commission has considered the following:

a) The actual O & M expenses allowed for FY13 excluding contribution

to Pension and Gratuity Trust.

b) The three year compounded annual growth rate (CAGR) of the

number of installations considering the actual number of

installations as per audited accounts up to FY15.

c) The weighted inflation index (WII) at 7.24% as computed above.

d) Efficiency factor at 2% as considered in the earlier two control

periods.

Thus, the normative O & M expenses for FY15 will be as follows:

Particulars FY15

No. of Installations As per actuals as per Audited Accts 2594010

Weighted Inflation Index 7.24%

Consumer Growth Index (CGI) based on 3 Year CAGR 3.34%

Base year O & M expenses - FY13 excluding P&G

contribution - Rs.Crs. 271.73

Normative O&M expenses = 0&M (t-1)*(1+WII+CGI-X)-

Rs.Crs. 318.28

The above normative O & M expenses have been computed without

considering the contribution to Pension and Gratuity trust.

The Commission has treated a part of the employee costs on account

of contribution to P&G Trust as uncontrollable O&M expenses as these

are based on the actuarial valuation report. This component has been

allowed beyond the controllable normative O&M expenses, to enable

the ESCOMs to meet their actual employee costs.

The GESCOM in its audited accounts for FY15 has indicated an amount

of Rs.51.49 Crores towards contribution to Pension and Gratuity Trust.

Considering the contribution of terminal benefits to Pension and

xxxix

Gratuity Trust as uncontrollable O & M expenses, the Commission has

computed the allowable O & M expenses for FY15 as follows:

TABLE – 4.9

Allowable O & M Expenses for FY15


Sl.


1 Normative O & M expenses 318.28

2 Additional employee cost (uncontrollable O & M

expenses)

51.49

Allowable O & M expenses for FY15 369.77

Thus, the Commission decides to allow an amount of Rs.369.77 Crores

as O&M expenses for FY15.

4.2.6 Depreciation:


The GESCOM has claimed an amount of Rs.91.28 Crores as

depreciation worked out after deducting Rs.20.85 Crores as

depreciation on assets created out of consumers’ contributions /

grants as per Accounting Standards (AS) – 12.

As per the audited accounts, the asset wise depreciation is as follows:

TABLE – 4.10

Allowable Depreciation for FY15 – GESCOM’s Submission


Particulars

Opening

Balance

of Asset

as on

01.04.2014

Closing

Balance

of Asset

as on

31.03.2015

Depreciation

for FY15

Buildings 26.62 31.55 1.13

Civil 5.05 5.89 0.05

Plant & M/c 418.09 471.63 21.48

Line, Cable Network 1860.44 2082.46 89.00

Vehicles 4.60 5.38 0.16

Furniture 3.95 4.28 0.18

Office Equipment 2.60 2.91 0.13

Total 2321.35 2604.10 112.13

xl

Less: Depreciation

withdrawn on assets

created out of consumer

contribution / grants

441.27 462.12 20.85

Net Depreciation 91.28


The depreciation is determined by the Commission in accordance

with the provisions of the KERC (Terms and Conditions for

Determination of Tariff) Regulations, 2006 as amended on 1st February,

2012. Considering the opening and closing balance of gross blocks of

fixed assets for FY15 and the depreciation as per audited accounts,

the weighted average rate of depreciation works out to 4.55%. Further,

an amount of Rs.20.85 Crores has been deducted towards

depreciation on assets created out of consumers’ contribution/ grants

as per Accounting Standards (AS) 12.

Based on the above, the Commission decides to allow the actual net

depreciation of Rs.91.28 Crores for FY15.

4.2.7 Capital Expenditure for FY15

The GESCOM has reported a capital expenditure as Rs.392.78 Crores as

against the approved capex of Rs.515 Crores for FY15. But it has

furnished the category wise breakup of capex only for Rs.392.80 Crores.

The category-wise breakup of the expenditure is shown below:

xli

Table - 4.11

Statement showing the Capital expenditure of GESCOM for FY15

Amount in Rs.Lakhs

Sl.

No. Particulars

Approved

capex of

FY15

Actual cost in

Rs. Lakhs

I Mandatory works, Social obligations and other works

a GKS-SC (SCP) 960 481.20

b GKS-ST (TSP) 560 358.00

c GKS-BC 240 347.60

d GKS-Min 240 262.80

e RGGVY 2000 0

f Rehabilitation of Flood affected villages (Special

Programme) 500 1

g Water Works 500 211.25

II Expansion of Distribution Network and System Improvement works.

a E&I works

b

Additional DTCs

25 kVA 300 4196.25

63 kVA 175 1762

100 kVA 125 585

c

Enhancement of DTCs

25kVA to 63kVA 200 159

63kVA to 100kVA 100 119.25

d Shifting of existing transformers to load center 30 34

E LT Line Conversion of 1 Ph 2 wire or 1 Ph 3 wire to 3Ph 5

Wire. 40 22.5

F Providing SMC Box to DTCs. 30 0

G Replacement of Broken poles 200 196

H Energization of IP Sets under General category 300 370.17

I Service Connection works other than IP/BJ/KJ/Water

works. 1500 2175.12

J Construction of new 33kV Stations. 1500 27.73

K Augmentation of 33kV Stations 500 0

L Construction of new 33kV Lines/Link Lines 200 0

M Construction of new 11kV Lines for 33kV / 110kV Sub-

Stations (Including SDP ) 2000 3600

N Niranthara Jyoti Yojana 8000 9825.42

O RAPDRP Part-A 1000 929.07

P RAPDRP Part-B 4000 2450.99

Q Creating Infrastructure to UAIP Sets Regularized during

2010-12. 4000 1243.95

III Reduction of T&D and AT&C losses.

A Providing meters to IP Sets above 10 HP 30 16.932

B Providing meters to BJ/KJ 40 20.106

C Providing meters to Street Lights 30 16.408

D Providing Timer Switches to Street Lights 100 0

E Replacement of Faulty / MNR energy meters by static

meters. 500 151.836

F Shifting of meters to outside premises 100 120.23

G DTC Metering of RAPDRP 0 0

H DTC Metering of non RAPDRP 1000 478.1

I Replacement of 33kV Line Rabbit Conductor by 100 0

xlii

Coyote Conductor

J 11kV Re-Conductoring 500 196

K LT Re-Conductoring 300 168.75

L HVDS 10000 0

M Taluk wise segregation of 11kV feeders 100 181.11

IV New Initiative Works

A IT Initiatives, Automation and Call Centers 500 0

B Establishing ALDC & SCADA 50 0

C R&M to SCADA 50 0

V Replacement and other miscellaneous works

A Replacement of failed Distribution Transformers 5000 6318.59

B Replacement of Power Transformers 200 0

C Replacement of Old and failed equipment and other

works of existing 33kV Stations & Lines. 1000 168.42

D R&M to 33kV Stations 100 20

E R&M to 33kV Lines 100 15

F R&M to DTCs 100 355.69

G R&M to Lines 200 296.15

H

Preventive measures to reduce the accidents

(Providing intermediate poles, Re-stringing of sagging

lines, providing guy and stud, guarding, shifting of

lines, fencing of DTCs)

500 159.72

I T&P Materials

i) Furniture 100 23.62

ii) Safety Materials 100 87.54

J Civil Engineering works 100 886.95

VI Other Works as approved in Tariff Order 2013, for the Capex

A Providing ETV Meters 100 0

B Providing HT Metering Cubicle 50 0

C Providing ABC UG Cables & Lines 100 0

D SCP & TSP Work

i) Energization of IP Sets 100 201.6

ii) Electrification of HB's/JC's 50 11

iii) Kutir Jyothi 50 0

E RE General Works 0

i) Kutir Jyothi 50 0

F Replacement of Electromagnetic meters by Static

meters 100 28.48

Total 51500 39280.5

Commission’s Analysis and decision:

From the above table, it is seen that, in some of the categories, the

GESCOM has incurred excess capex over the approved amount. In

some of the other categories GESCOM has not spent any capex. The

Commission had directed the KPTCL and the ESCOMs to approach the

Commission with proper justification, if the capex in any category is

likely to exceed 10% or Rs.10 Crores, in the financial year, for an in-

principle approval, but the GESCOM has not sought any approval of

this kind. Some of the categories in which the capex has been

exceeded the approved limits are:

xliii

i. In respect of NJY, the GESCOM has achieved a capital expenditure

of Rs.98.25 Crores which is 23% above the approved capex of Rs.80

Crores.

ii. In respect of Replacement of Faulty transformers by new

Transformers, the cost incurred by the GESCOM is stated at Rs.63.19

Crores, against the approved limit of Rs.50 Crores. The GESCOM

should note that, the failed transformers should be replaced by

repaired good transformers and accounted as revenue

expenditure. In case, the failed transformer is scrapped then it

could be replaced by a new transformer and accounted as capex.

From the details of the failed transformers submitted by the

GESCOM, it is seen that 13942 transformers failed, 216 transformers

were scrapped, 13,703 transformers were repaired and 493 new

transformers provided for replacement of failed transformer at a

cost of Rs.66.63 Lakhs. The cost of new transformers procured for

replacement of failed transformers can only be taken as capex by

the GESCOM. Hence, the capex indicated in the table above gets

modified from Rs.39280.5 Lakhs to Rs.33028.1 Lakhs.

Further, looking at the capital expenditure achieved by the GESCOM

for the past financial years, the achievement is not commensurate with

the approved capex. The following table shows the year-wise

expenditure incurred by the GESCOM against the approved capex is

shown in the following Table:

TABLE – 4.12

Approved Vs Actual capital investment Amount in Rs.Crores

Particulars FY12 FY13 FY14 FY15

Capital Investment

Proposed & Approved 572.7 466.67 552.5 515.00

Capital Investment actually

incurred (Figures as per

Annual Report)

179.15 293.17 364.19 330.28

Short fall 393.35 173.5 188.31 184.72

% Achievement 31.83% 62.82% 65.92% 64.13%

xliv

The above facts indicate that there is no proper planning and

execution of Capex in the GESCOM. The Commission notes that, the

achievement of capital expenditure targets in the GESCOM has

improved from FY13 onwards, but in some of the categories of works,

GESCOM needs to focus its spending to cater to the needs of all

categories of works. The Commission directs the GESCOM to put in

place an effective planning, execution and monitoring system, to

improve its capex performance as per the “Capital expenditure

guidelines for ESCOMs” circulated by the Commission.

The Commission taking note of the above facts, decides to allow the

actual capital expenditure of Rs.33028.10 Lakhs, for FY15, after

deducting the overstatement of capex for replacement of failed

transformers.

4.2.8 Prudence check of capital expenditure for FY15:

The prudence check of capex of GESCOM was taken in two parts:

a) Prudence check of execution of the capital works of FY15:

b) Prudence check of material Procurement process of FY15:

a) Prudence check of execution of the capital works of FY15:

The Commission has taken up prudence check of the capital

expenditure incurred by GESCOM for the period FY15, by engaging the

services of M/s. Deloitte Touche Tohmatsu India Private Limited (M/s.

Deloitte) as consultant to evaluate the prudence of the capital

expenditure incurred by the GESCOM for FY15, in respect of

completed and categorized works.

M/s. Deloitte has collected the necessary data for FY15 from the

GESCOM. The works were divided into three categories based on the

cost: (a) works costing above. Rs.6 Lakh, (b) work costing Rs.3 to 6

Lakh, and (c) Works below Rs.3 Lakhs. The works were taken up under

various schemes like RAPDRP, UNIP and Niranthara Jyothi Schemes

apart from general capital works like service connection, Extension &

Improvement works, Civil engineering works, metering, etc. A

representative sample in each category was selected, covering the

geographical area of the Company, as per the Scope of work.

M/s. Deloitte has considered sample works of 82 No.s with a cost of

Rs.4,519 Lakh in Rs.6 Lakh and above category, 20 No. of works with a

cost of Rs.107 Lakh in Rs.6 Lakh to Rs.3 Lakhs category and 23 No. of

xlv

works from 8 divisions with a total cost of Rs.53 Lakh in below Rs.3 Lakh

category.

As per the report submitted by the consultant, the following are the

salient features of prudence check:

TABLE – 4.13

Gist of Prudence check findings for FY15

Particulars Numbers Amount

in Rs. Lakhs

Works costing Rs.6 Lakhs and above considered as

samples for validation 82 4,519

Works costing between than Rs.6 Lakhs and Rs.3

Lakhs considered as samples 20 107

Works costing below Rs.3 Lakhs considered as

samples 24 53

Works not meeting the

norms of prudence

Rs.6 Lakhs and above 01 18.91

Rs.6 Lakhs and Rs.3 Lakhs Nil

below Rs.3 Lakhs Nil

Total works not meeting the norms of prudence 01 18.91

Some of the other findings of the prudence check are summarized in

the following Table:

Summary of Works having cost overrun

Particulars Within 10% 10-25% Above 25%

Rs.6 Lakhs and above 63 06 13

Rs.6 Lakhs and Rs.3 Lakhs 12 01 07

below Rs.3 Lakhs 23 - 01

xlvi

Summary of Works having Time overrun

Particulars Within one

Year

Between one

and two Years

above 2 Years

Rs.6 Lakhs and above 48 29 5

Rs.6 Lakhs and Rs.3 Lakhs 20 - -

below Rs.3 Lakhs 24 - -

The Commission notes that, one work pertaining to GESCOM i.e.

“Construction of Section Office building at Muchanba Basvakalyan

Sub-Division at Humnabad Division” is termed as not meeting the norms

of prudence, as the Section Office building after completion, was

without power supply and not occupied /utilized. The Commission

forwarded the copy of the final Report on the Prudence check seeking

GESCOM’s comments thereon. The reply forwarded by the GESCOM is

summarized below:

GESCOM, in its reply, has stated that, it has carried out the minor

repairs required for the Section Office building and arranged power

supply and occupied the premises from 23.2.2016 and requested the

Commission to consider the work as prudent.

The Commission, taking note of the reply submitted by the GESCOM,

decided to consider the work as meeting norms of prudence.

b) Prudence check of material Procurement process of FY15:

The GESCOM has been executing capital works both on turnkey as

well as partial turnkey contracts. In the process, the GESCOM procures

major materials like, distribution transformers, poles and conductor etc.

and issues them to the partial turnkey contractor for carrying out the

labour contract work as per award. The contractor would also invest

on some of the smaller materials associated with the works viz., cross

arm, bolt & nuts, earthing materials etc., if necessary.

xlvii

In view of the fact that, a large quantity of major materials are being

procured by the ESCOMs, the Commission decided to review material

procurement process of major materials as a part of prudence check

carried out, to ensure that, the procurement is carried out in a cost

effective manner without compromising with the operational needs.

Hence, the consultant was directed to look into the procurement

process of the GESCOM, and analyze the process.

The prudence check of material procurement analysis pertaining to

the period FY15, revealed that a considerable level of inventory vis-à-

vis the actual requirement seems to be maintained in the case of:

a) Two pin and three pin cross arms,

b) Guy Strain Insulator No. 08,

The Consultant has also stated that, even though, the GESCOM has

kept a considerable level of inventory, keeping a higher stock of some

of the critical items may not be treated as inefficiency of the ESCOM. It

is further stated that, the GESCOM is also adhering to open tendering

under e-procurement mode, for all the purchases.

The Commission suggests that, the GESCOM has to take steps to utilize

the materials in a systematic way and reduce inventory by planning

the delivery schedule of the material to synchronize with the work

execution. The inventory level should be around 25% of the

consumption, at any given time, to avoid idle stock.

c) Prudence check of execution of the capital works of FY13 & FY14

During the prudence check of capital expenditure of FY13 & FY14,

Rs.139.04 Crores pertaining to DTC metering and Rs.7.72 Crores spent

by KPTCL on the projects for the GESCOM (for which non completion of

downstream works are attributable to the GESCOM), were termed as

not meeting the norms of prudence check. The Commission had given

an opportunity to the GESCOM to arrange for DTC metering and

xlviii

conduct energy audit of all DTCs and to construct downstream lines of

KPTCL substation and justify the works as meeting prudence norms.

GESCOM has submitted the relevant data to justify the works as

meeting the prudence norms and stated that, it is going to continue

the energy audit of DTCs and it has constructed the downstream lines

of KPTCL. The Commission after verifying the data submitted by the

GESCOM decides to treat the works as meeting the prudence norms.

d) Prudence check of execution of the capital works of FY10 to12:

The Commission had disallowed the interest and depreciation charges

on the capex of PLCC equipment of RLMS infrastructure in the past two

years sufficiently and decides to discontinue the disallowance

henceforth.

4.2.9 Interest and Finance Charges

a) Interest on loan:


GESCOM in its filing has claimed an amount of Rs.74.51 Crores

towards interest on long term loans drawn from banks / financial

institutions during FY15.


The Commission has noted the status of opening and closing balances

of long term loans as per the audited accounts for FY15 and Format D9

of the filings. The interest claimed by the GESCOM includes an amount

of Rs.0.45 Crores pertaining to interest on short-term loans which has

been considered separately while allowing interest on working capital.

The allowable interest on long term loans are computed as shown

below:

l

TABLE – 4.14

Allowable Interest on Loans – FY15


Particulars FY15

Opening balance of secured loans 569.64

Opening balance of unsecured loans 12.49

Total opening balance of long term loans 582.13

Add: New Loans 165.21

Less Repayments 52.06

Total loan at the end of the year 695.28

Average Loan 638.71

Interest on long term loans as per audited accounts for FY15 74.07

Considering the average loan of Rs.638.71 Crores and an amount of

Rs.74.07 Crores incurred towards interest on long term loans, the

weighted average of interest works out to 11.60% for FY15. The actual

weighted average rate of interest is comparable with the prevailing

rate of interest for long term loans.


towards interest on loan for FY15.

4.2.10 Interest on Working Capital:


The GESCOM has stated that it has borrowed short term loans

during the year to meet its day to day expenditure (working

capital) during FY15. As per the audited accounts, the

GESCOM has incurred an amount of Rs.0.45 Crores towards

interest on short term loan of Rs.30.66 Cores during FY15.

However, the GESCOM, in its application under Format - D9, has

claimed an amount of Rs.86.70 Crores an interest on working

capital. Further, during the validation meeting, GESCOM has

claimed interest on working capital of Rs.77. 60 Crores based on

the norms as per MYT Regulations.

li


As per audited accounts, the GESCOM has incurred an interest of

Rs.0.45 Crores on short term borrowings during FY15. It is observed from

the audited accounts of the GESCOM for FY15 that, short term loan of

Rs.30.60 Crores is borrowed during FY15 and meagre interest of Rs.0.45

Crores has been incurred.

The present interest rates by commercial banks and financial

institutions are being charged mainly on the basis of base rate of

interest declared by the RBI from time to time. Hence, the Commission

has been considering the base rate plus certain basis points

depending upon the tenure of the loan. Considering the base rate of

interest of 9.30% with a spread of 250 basis points and taking note of

the downward trend in the interest rate, the Commission decides to

allow the normative interest on short term loans of 11.75% for FY15.

As per the KERC (Terms and Conditions for Determination of Tariff)

Regulations, 2006 as amended on 1st February, 2012, the Commission

computes the allowable interest on working capital for FY15 as follows:

TABLE – 4.15

Allowable Interest on Working Capital for FY15

Amount in Rs.Crores

Particulars FY15

One-twelfth of the amount of O&M Expenses 30.81

Opening GFA 2327.68

Stores, materials and supplies 1% of Opening balance of GFA 23.28

One-sixth of the Revenue 520.87

Total Working Capital 574.96

Rate of Interest (% p.a.) 11.75

Normative Interest on Working Capital 67.56

Actual interest on WC as per audited accounts for FY15 0.45

Allowable Interest on Working Capital 34.00


towards interest on working capital for FY15.

4.2.11 Interest on Consumer Deposits:


lii

The GESCOM in its filing has claimed an amount of Rs.35.11

Crores towards payment of interest on security deposits as per

audited accounts for FY15. However, in the replies to the

observations made during the validation meeting, the GESCOM

has indicated interest on consumer deposit of Rs.32.01 Crores for

FY15.


The Commission notes that, the interest on consumer deposits

amounting to Rs.35.12 Crores claimed by the GESCOM is based on the

average amount of consumer deposits held during FY15 as per

audited accounts for FY15 and works out to a weighted average rate

of interest of 8.95%. As per the KERC (Interest on Security Deposit)

Regulations, 2005, the interest on consumer deposits is to be allowed as

per the bank rate prevailing as on the 1st of April of the relevant year.

The bank rate as on 1st April, 2014 was 9.00%. The Commission notes

that the interest claimed by GESCOM is within the applicable bank

rate.


claimed towards interest on consumer deposits for FY15.

4.2.12 Other Interest and Finance charges:

The GESCOM has claimed an amount of Rs.0.97 Crores towards other

interest and finance charges for FY15 which includes charges payable

to banks / financial institutions and guarantee commission payable to

GoK. The Commission notes that the claims are as per the audited

accounts and hence decides to allow the same for FY15.

4.2.13 Interest on belated payment of power purchase cost:

GESCOM in its filing has claimed Rs.115.47 Crores towards interest on

belated payment of power purchase cost for FY15. Since interest on

liii

working capital is being allowed separately as per the norms for

managing the day to day expenditure of the company without any

delays, the Commission decides not to allow interest on belayed

payment of power purchase cost separately.

Thus the allowable interest and finance charges for FY15 are as follows:

TABLE – 4.16

Allowable Interest and Finance Charges

Amount in Rs.Crores

Sl.


1. Interest on Loan capital 74.07

2. Interest on working capital 34.00

3. Interest on consumer deposits 35.12

4. Other interest and finance charges 0.97

Total interest and finance charges 144.16

4.2.14 Other Debits:


GESCOM, in its application has claimed an amount of Rs.58.74

Crores towards other debits for FY15 as detailed below:

TABLE – 4.17

Other Debits – GESCOM’s Submission


Sl

No Particulars FY15

1 Provision for contingencies and others 53.66

2 Bad debts written off 4.73

3 Miscellaneous losses and write offs 0.35

Total 58.74


The Commission notes that the claims of the GESCOM includes an

amount of Rs.52.24 Crores pertaining to provisions for contingencies

and Rs.4.73 Crores towards provision for bad and doubtful debts. Since

these amounts are being claimed on provisions without actually

incurring, the Commission decides to disallow such claims.

liv

Further, as per the audited accounts, the allowable other debits for

FY15 are as detailed below:

lv

TABLE – 4.18

Allowable Other Debits


Sl

No Particulars FY15

1 Asset decommissioning cost 0.18

2 Miscellaneous losses 0.34

3 Compensation for death, injuries and

damages 1.22

Total 1.74

Thus, the Commission decides to consider an amount of Rs.1.74 Crores

as other debits for FY15.

4.2.15 Net Prior Period Charges:


As per the audited accounts the GESCOM has claimed in its filing

the Net Prior Period credit of Rs.5.99 Crores for FY15.


As per the Audited Accounts for FY15, the Commission notes that, the

prior period debit includes Rs.12.17 Crores on account of employee

costs and other expenses relating to earlier years. Further the prior

period credit of Rs.18.16 Crores is on account of excess provision for

depreciation and other expenses.

Thus, the Commission decides to allow a net prior period credit of

Rs.5.99 Crores for FY15.

4.2.16 Return on Equity:


The GESCOM has claimed an amount of Rs.54.83 Crores towards

Return on Equity of Rs.282.96 Crores for FY15, on the closing

lvi

balance of paid up share capital, share deposits and reserves

and surplus.


As per the KERC (Terms and Conditions for Determination of Tariff)

Regulations, 2006 as amended on 1st February, 2012, the Commission

has computed the allowable Return on Equity at 15.5% on equity plus

reserves and surplus as at the beginning of the year besides allowing

taxes as per actuals. Considering the status of equity as per audited

accounts for FY15, the allowable RoE is determined as follows:

TABLE – 4.19

Allowable Return on Equity


Particulars FY15

Paid Up Share Capital 305.14

Share deposit 302.58

Reserves and Surplus as on 31.03.2015 (310.98)

Recapitalization of security deposit (22.00)

Total Equity 274.74

RoE @ 15.50% of Equity 42.58

Considering accumulated losses of Rs.310.98 Crores and total equity of

Rs.607.72 Crores as at the beginning of the year and after deducting the

recapitalization of Consumer’s security deposit of Rs.22.00 Crores, GESCOM

has Rs.274.74 Crores as equity as at the beginning of FY15.

As per the provisions of the MYT Regulations, the Commission decides

to allow an amount of Rs.42.58 Crores as Return on Equity for FY15.

4.2.17 Income tax :

As per the audited accounts, GESCOM has not incurred any expenditure

towards payment of Income Tax for FY15. The Commission decides not to

allow any amount towards Income Tax for FY15.

lvii

4.2.18 Other Income:


The GESCOM has indicated an amount of Rs.41.26 Crores as Other

Income for FY15. This amount includes income from sale of scrap, rent

from staff quarters, rebate on power purchase / electricity duty and

miscellaneous recoveries / income. Further, the GESCOM has earned

Rs.18.65 Crores as incentive towards timely payments of power

purchase bills.


As per the audited accounts, an amount of Rs.41.26 Crores is indicated

as other income for FY15. As decided in the earlier Tariff Orders, to

encourage and bring in financial discipline, in timely payment of

monthly power purchase bills, the Commission continues to allow 10%

of the total incentive amounting to Rs.1.86 Crores on account of timely

payment of power purchase bills to be retained by the GESCOM for

FY15. Thus after deducting the incentive amount of Rs.1.86 Crores, the

Commission decides to allow an amount of Rs.39.43 Crores as other

income for FY15.

4.3 Abstract of Approved ARR for FY15:

As per the above item-wise decisions of the Commission, the

consolidated Statement of ARR for FY15 is as follows:

lviii

TABLE – 4.20

Approved ARR for FY15 as per APR


Sl.

No Particulars

As per

APR

Revenue at in Rs Crs

1 Revenue from tariff and Misc Charges 1861.55

2 Tariff Subsidy for IP & BJ/KJ 1263.67





5 SLDC Charges 2.61


transmission 2451.68

6 Employee Cost

7 Repairs & Maintenance

8 Admin & General Expenses

Total O&M Expenses 369.77





12

Interest on belated payment on PP

Cost 0.00



15 Less: Interest capitalised 0.00



17 Net Prior Period Debit/Credit -5.99

18 RoE 42.58

19 Provision for taxation 0.00

20

Funds towards Consumer

Relations/Consumer Education 0.00

21 Other Income 39.43

22 Net ARR 3055.79

4.3.1 Gap in Revenue for FY15:

As against an approved ARR of Rs.3203.13 Crores, the Commission

after the Annual Performance Review of the GESCOM decides to allow

an ARR of Rs.3055.79 Crores for FY15. Considering the revenue of

lix

Rs.3125.22 Crores, a surplus of Rs.69.43 Crores is determined for the year

FY15.

The Commission decides to carry forward the surplus of Rs.69.43 Crores

of FY15 to the proposed ARR for FY17 as discussed in the subsequent

Chapter of this Order.

lx

CHAPTER – 5

ANNUAL REVENUE REQUIREMENT FOR FY17-19

5.0 Annual Revenue Requirement (ARR) for FY17-FY19 - GESCOM’s Filing:

GESCOM in its application dated 15th December, 2015, has sought

approval of ARR for FY17-19. The summary of the proposed ARR for

FY17-19 is as follows:

TABLE – 5.1

Proposed ARR for FY17-19

Amount in Rs.Crores

Sl.

No Particulars FY17 FY18 FY19

1 Energy @ Gen Bus in MU 8559.24 8902.60 9289.70

2 Transmission Losses in % 3.47% 3.37% 3.27%

3 Energy @ Interface in MU 8262.23 8602.58 8985.92

4 Distribution Losses in % 17.60% 17.00% 16.49%

Sales in MU

6 Sales to other than IP & BJ/KJ 3448.78 3704.15 3976.85

7 Sales to IP & BJ/KJ 3359.30 3435.99 3526.85

8 Total Sales 6808.08 7140.14 7503.70

Revenue at existing tariff in Rs Crs

9 Revenue from tariff and Misc Charges 2142.72 2288.60 2450.69

10 Tariff Subsidy 1541.57 1577.61 1619.95

11 Total Existing Revenue 3684.29 3866.21 4070.64


12 Power Purchase Cost 2380.36 3268.45 3526.20

13 Transmission charges of KPTCL 389.83 425.27 460.71

14 SLDC Charges 4.24 4.62 5.01

15


transmission 2774.43 3698.34 3991.92

16 Employee Cost 443.99 501.97 634.44

17 Repairs & Maintenance 46.94 52.54 58.83

18 Admin & General Expenses 93.23 103.79 115.97

19 Total O&M Expenses 584.16 658.30 809.24

20 Depreciation 152.01 176.69 200.60

21 Interest & Finance charges

22 Interest on Loans 143.04 161.26 169.63

23 Interest on Working capital 93.74 99.51 106.50

24 Interest on belated payment on PP Cost 217.76 245.49 273.50

25 Interest on consumer deposits 35.29 37.05 38.90

26 Other Interest & Finance charges 0.00 0.00 0.00

lxi

27 Less interest & other expenses capitalised 7.87 4.49 4.28

28 Total Interest & Finance charges 481.96 538.82 584.25

29 Other Debits 31.60 34.76 38.24

30 Net Prior Period Debit/Credit 14.00 5.00 5.00

31 Return on Equity 90.89 114.31 142.28

32


Relations/Consumer Education 0.00 0.00 0.00

33 Other Income 41.30 44.38 47.77

34 ARR 4087.75 5181.84 5723.76

35

Deficit

-403.46 -1315.63

-

1653.12

36 Surplus/Deficit for FY15 carried forward -138.03

37 Regulatory asset -152.94

38 Carrying cost on RA

39 Net ARR 4378.72 5181.84 5723.76

GESCOM has requested the Commission to approve the Annual

Revenue Requirement of Rs.4378.72 Crores for FY17, Rs.5181.84 Crores

for FY18 and Rs.5723.76 Crores for FY19. Further, GESCOM has

proposed increase in retail supply tariff by 102 paise per unit in respect

of all the categories of consumers including BJ/KJ and IP set consumers

for FY17, in order to bridge the gap in revenue of Rs.694.43 Crores.

5.1 Annual Performance Review for FY15 & FY16:

As discussed in the preceding chapter of this order, the Commission

has carried out the Annual Performance Review for FY15 based on the

audited accounts furnished by GESCOM. Accordingly, a surplus of

Rs.69.43 Crores of FY15, is required to be carried forward in to the ARR

of FY17.

As regards APR for FY16, the current financial year (i.e. FY16) is yet to be

completed. Hence, the Commission decides to take up the APR of

FY16 during the revision of ARR / Retail Tariff for FY18.

lxii

5.2 Annual Revenue Requirement for FY17-19:

5.2.1 Capital Investments for FY17-19:

Proposed Capex of FY17 to FY19:

The GESCOM for the control period of FY17, FY18 and FY19 has

proposed its capital investment of Rs.1810 Cores, Rs.1618 Crores and

Rs.1031 Crores respectively. GESCOM has stated that, it has taken up

“Operational Efficiency Improvement Plan”, as the Company is

concerned about the high-level distribution losses in the system and

has initiated various steps to bring down the losses during the current

year. GESCOM proposes to continue and accelerate its efforts in the

direction of operational efficiency improvement plan.

Further, on the Distribution loss Reduction, the GESCOM has stated that,

the loss level was 17.77% in FY14, 17.00% in FY15 and 18.00% in FY16

and it is planned to bring down to distribution losses for FY17 at 17.60

%, 17.00% for FY18 and in year FY19 it is proposed to bring down losses

to 16.50 % by taking up:

a) Replacement of all Non-recording in energy meters.

b) Metering of all Streetlight installations.

c) Shifting of transformers to load centers.

d) Addition of 11 KV lines to bring down the HT/LT Ratio.

e) Addition of Distribution Transformers to the network.

f) Intensified inspection of installation and detecting commercial

losses by vigilance and MRT wings.

The GESCOM has indicated the capital investment for FY17 to FY19 in

different category of works as follows:

lxiii

TABLE – 5.2

Proposed Capex of GESCOM for FY17 to FY19


Sl.

No. Particular

2016-17 (in Crs) 2017-18 (in Crs) 2018-19 (in Crs)

Proposed

Budget

Expected

to be

completed

Proposed

Budget

Expected

to be

completed

Proposed

Budget

Expected

to be

completed

1 2 5 6 7 8 9 10

1

33kV Sub-station, 33kV line

works & Augmentation of

33kV S/S's

20 8 15 10 25 22

2 RGGVY works REC 10 3 50 40 75 70

3

RAPDRP works

Part-A 25 10 5 3 2 2

Part-B 85 20 25 20 5 5

IPDS 183.1 50 133 100 33.1 33.1

4

Reconductoring works:

a) 33kV lines 3 1 3 2 3 2

b) 11kV lines 5 2 5 4 15 13

5 DTC metering works 45 10 35 20 15 10

7 Water supply works 5 2 5 3 5 4

8

Additional DTC's works:

a) New DTC's 5 2 6 4 6 4

b) Enhancement of DTC's 3 1 3 2 3 2

9 Replacement failed 11 KV

transformers 12 10 13 10 10 8

10 Replacement of Power

transformers 2 1 2 1 2 1

11 Replacement of MNR

meters 5 3 5 3 5 4

12 Providing ETV meters 1 1 1 0.5 1 1

13 Providing HT metering

Cubicles for ring fencing 0.5 0.5 0.5 0.5 0.5 0.5

14

Service Connection works:

a) General works 10 10 15 10 15 13

b) IP set works 2 2 2 1 2 1

15

A

SI works (33KV link line /

Express feeders) 1 1 2 1 2 1

15

B

SI works (11KV Link line /

Express feeders,) 15 6 15 10 12 10

16

a) Nirantara Jyoti works 125 50 110 80 0 0

b) Deen Dayal Upadhay

Gram Jyothi Yojane 496.8 50 447 138 309 309

17

a) Major Replacements in

S/S's & lines 5 2 0.5 0.5 0.5 0.5

b) Replacement of Age

old Equipments in existing

S/S & lines

5 3 5 4 5 4

18 Civil Engineering works 10 6 8 6 8 6

19 IT initiatives 3 1.5 2 2 2 1

lxiv

20 HVDS Works 25 12 75 60 75 60

21 Providing ABC , UG Cables

& RMUs 605 65 540 225 315 305

22 SCADA works 1 1 1 0.5 1 0.5

23

SCP & TSP works

a) Energisation of IP sets 1 1 1 0.5 1 0.5

b) Electirification of

HB's/JC's 0.5 0.5 0.5 0.5 0.5 0.5

c) KutirJyoti 0.5 0.5 0.5 0.5 0.5 0.5

24 Ganga kalyan scheme

works 25 12 25 20 25 20

25 T & P Articles 1 1 0.5 0.5 0.5 0.5

26

Replacing of Electro

Magnetic meters by Static

meters

1 0.5 1 1 1 0.5

27 Metering of IP/St.

Lights/BJ&KJ sets 1 0.5 1 1 1 0.5

28

Providing Infrastructure to

Regularisation of

Unauthorized IP sets

60 20 40 35 30 25

29 R.E General works:

a) Kutir Jyoti 0 0 10 8 10 8

30 Prevention of electrical

accident & safety 5 2 5 3 5 3

31 Electrification of

Rehabilitation villages 2 1.5 5 3 5 3

32 Taluka wise segregation of

11kV feeders 0 0 0 0 0 0

Total 1810 374 1618 834 1031 954

Commission’s Analysis and decision:

From the above table, the Commission notes that, GESCOM has

proposed an ambitious capex program indicating a capex

requirement of Rs.1810 Crores, Rs.1618 Crores and Rs.1031 Crores for

FY17, FY18 and FY19 respectively, against which the expected capital

expenditure likely to be incurred is indicated as Rs.374 Crores, Rs.834

Crores and Rs.954 Crores for FY17, FY18 and FY19 respectively.

GESCOM needs to indicate the expected capital expenditure for the

control period in a realistic way as the same will have a bearing on the

interest allowable on long term loans and impact the tariff

computation.

Further, from the above table indicating the categories of works, the

following points are observed:

lxv

In case of RGGVY works GESCOM has indicated a capex of Rs.10

Crores, Rs.50 Crores and Rs.75 Crores for FY17, FY18 and FY19

respectively. But, GESCOM has not furnished the details as to when

these works will be completed.

Regarding the replacement of failed transformers, the GESCOM should

note that, the failed transformers should be replaced by repaired good

transformers only and it should be charged to revenue expenditure. In

case, the failed transformer is scrapped it can be replaced by a new

transformer which can be booked under capex. Hence, the proposed

a capex of Rs.12 Crores, Rs.13 Crores and Rs.10 Crores for FY17, FY18

and FY19 respectively by GESCOM is not acceptable and the

Commission allows a maximum of Rs.5 Crores per year for procurement

of new transformers in place of scrapped distribution transformers.

In the case of NJY works, GESCOM has proposed Rs.125 Crores, Rs.110

Crores for FY17 and FY18 respectively, but it has not indicated any

capex for FY19. GESCOM has not indicated the targets of completion

of works within FY18.

In the case of Deen Dayal Upadhyay Gram Jyothi Yojane (DDUGJY),

GESCOM has indicated a huge capex of Rs.496.8 Crores, Rs.447 Crores

and Rs.309 Crores for FY17, FY18 and FY19 respectively. But, GESCOM

has not indicated the amount of grants it is likely to receive from the

Government.

In the case of HVDS, GESCOM has proposed a capex of Rs.25 Crores,

Rs.75 Crores and Rs.75 Crores for FY17, FY18 and FY19 respectively.

GESCOM has stated that, the project reports for Kudalgi and Sindhanur

have been prepared for 36 Nos of 11kV feeders. The GESCOM should

indicate a timeline for completing the works.

lxvi

In the case of providing ABC, UG Cables & RMUs, GESCOM has

proposed a capex of Rs.605 Crores, Rs.540 Crores and Rs.315 Crores for

FY17, FY18 and FY19 respectively. GESCOM has mentioned that, it has

floated tenders for the works to be taken up in Kalaburagi city and will

be inviting tenders for other cities also.

In the case of providing infrastructure to un-authorised IP Sets,

GESCOM has proposed a capex of Rs.60 Crores, Rs.40 Crores and Rs.30

Crores for FY17, FY18 and FY19 respectively. But, GESCOM has not

specified the time frame for completing infrastructure for all the UN-IP

sets.

While projecting the capital expenditure for the control period,

GESCOM should identify high loss feeders, high loss subdivisions,

divisions and circles to specifically reduce losses and to improve

reliability of distribution system. GESCOM should list out the lengthy 11

kV feeders with huge loads and bifurcate them to reduce the loads

and losses thereby improving the reliability and quality of supply.

The optimal distribution system loss should be less than 10% even to

maintain the voltage regulations within the permissible limits of 9 % for

11kV system and 6% for LT distribution system. The GESCOM should plan

towards bringing down the distribution system losses below 10% by the

end of plan period.

GESCOM should list out high loss feeders of the year in descending

order and should chalk out a program to tackle high loss feeders on

priority to reap the benefit of loss reduction.

The GESCOM should prepare a detailed perspective plan by

conducting 11kV feeder- wise and DTC- wise load flow studies,

considering the present and projected loads on each feeder. This

would lead to implementing least cost, techno-economically feasible

lxvii

improvement methods, for reducing distribution system energy losses to

less than 10% and improve the reliability of the system.

Regarding the system strengthening works, for the period from FY-17 to

FY-21, GESCOM should ascertain as to whether the proposed capex

would result in in loss reduction and improvement of reliability by

conducting Techno-economic analysis.

The GESCOM should take up system improvement works such as:

a) Reactive power compensation to improve the PF to 0.9-0.95 lag.

b) Reconfiguration of distribution lines.

c) Replacement of conductors by higher size wherever required.

d) Drawing express feeders to bifurcate the loads.

e) Establishing new 33kV substations and proposing for

Establishment of new transmission voltage substations by KPTCL.

f) Installing additional DTCs and shifting DTCs to load centers to

reduce the LT line lengths.

The Commission notes that the GESCOM has not achieved capex of

more than 65% of the approved capex in any previous years. The

Commission also notes that, as against the planned capex proposal of

Rs.1810 Cores, Rs.1618 Crores and Rs.1031 Crores, GESCOM is likely

spend a capex of Rs.374 Cores, Rs.834 Crores and Rs.954 Crores for

FY17, FY18 and FY19 respectively. Thus there is a wide variation

between the planned and likely expenditure. Hence, for the purpose of

tariff computations, the Commission has decided to consider capex of

Rs.500 Crores for FY 17 to FY19, subject to Prudence Check. In case, the

GESCOM requires any additional capex during the financial year, the

Commission may be approached with proper justification for in

principle approval.

5.2.2 Sales Forecast for FY17-19:

lxviii

I. Category wise estimates of number of installations and sales by

GESCOM for the control period FY17 to FY19:

1) The GESCOM, in their application has stated that the energy

sales for metered categories for the control period has been

estimated on the basis of actual consumption available for FY14

and FY15 and for LT4(a), on the basis of sample studies and for

BJ/KJ based on specific consumption of 17 units per installation

per month.

2) The Commission’s preliminary observations on the sales forecast

for the control period, the queries raised by the Commission

during the validation process and the replies furnished by the

GESCOM thereon are discussed below:

i) LT(1) – BJ/KJ Category:

During the validation process, the Commission had observed that

there were some discrepancies in the data furnished on BJ/KJ

installations. GESCOM, in its response, has rectified the same.

ii) Other categories excluding IP Sets:

a) The Commission had observed that the GESCOM had

considered only one year data for estimating the sales for the

control period and that while forecasting for the future period of

three years, at least three to five years past data need to be

considered. The GESCOM had also not indicated category wise

working details of estimates made for the number of installations

and sales along with their growth rates. In this context the

growth rates for number of installations and sales was furnished

to GESCOM for the period FY10 to FY15 and FY-12 to FY15 for

consideration. Since the GESCOM had not furnished the details,

the above matter was again raised during the validation

meeting.

lxix

In response to the above, GESCOM has furnished year on year growth

rates for both the number of installations and energy sales for the

period FY-12 to FY-15 and the estimates for FY16 to FY19.

The Commission notes that except furnishing the year on year growth

rates, GESCOM has not explained the reasons for considering a

particular growth rate for projections.

b) The GESCOM was directed to analyse the reasons for

considerable increase in LT6 street lights installations and

decrease in HT2 (a) installations during FY15. Further, it was

directed to analyse the reasons for negative growth in sales to

LT industries, LT water supply and HT2 (a) during FY15. The

Commission notes that. GESCOM has not furnished any analysis

in the matter.

c) During the validation process, the Commission had requested

the GESCOM to furnish the breakup of sales under Open

access/wheeling to HT-2a, HT-2b and other HT categories. In

response the GESCOM has furnished the year-wise details for the

period FY13 to FY15.

The Commission notes that the GESCOM has not furnished HT

category-wise break-up of sales under OA/wheeling. As such the

impact of OA/wheeling on each category of HT consumers could not

be analyzed.

II. The Commission’s approach for estimating the number of

installations and sales for Control Period FY17-19:

The Commission has issued KERC (Load Forecast) Regulations, 2009

which specify that the Commission shall normally adopt the forecast as

lxx

per EPS and can deviate from the EPS while approving ERCs or PPAs by

passing orders after duly giving opportunity to the stakeholders.

For the present control period FY17 to FY19, the filing done by ESCOMs

indicates that sales forecast is not in tune with the 18th EPS. The tariff

petition filed by the ESCOMs which includes the sales estimates and

power purchase quantum has been made public and the

stakeholders have been heard in the matter. After considering the

views expressed by the stakeholders the Commission has decided to

adopt the methodology specified in the following paragraphs which is

different from the CEA’s approach for the reasons stated below:

a. The State of Karnataka is under peak and energy shortages and

the supply of electricity is determined by the generation availability,

which is at present restricted. The last three year data of energy at

generation bus indicated below justify the above stand:

Year 18th EPS - Generation

MU

Actual supplied

MU

2013 58513 57046

2014 63001 57725

2015 67833 59969

From the above Table, it is seen that the actual growth rate is

different from those estimated by in the 18th EPS, by the CEA.

b. The loss levels considered by the Commission are as per the loss

reduction trajectory fixed by the Commission for the respective

control periods. Hence the loss levels as adopted by the CEA are

not relevant for the purpose of the approval of ARR and Tariff.

In view of the above, the Commission has considered the business as

usual scenario and the methodology adopted by the Commission to

lxxi

estimate the number of installations and sales to categories other than

BJ/KJ and IP sets is discussed below:

1) No. of Installations:

While estimating the number of installations (excluding BJ/KJ and IP),

the following approach is adopted:

a. The base year number of installations for FY16 is modified duly

validating the revised estimate furnished by GESCOM in the current

filing and the data available as on 30.11.2015. Accordingly the

base year estimation has been revised which has an impact on the

estimates on number of installations and sales for the control

period.

b. Wherever the number of installations estimated by GESCOM for the

control period is within the range of the estimates based on the

CAGR for the period FY10 – FY15 and for the period FY12 - FY15, the

estimates of GESCOM are retained.

c. Wherever the number of installations estimated by GESCOM for the

control period is lower than the estimates based on the CAGRs for

the period FY10 – FY15 and for the period FY12 - FY15, the estimates

based on the lower of the CAGRs for the period FY10 – FY15 and for

the period FY12 - FY15 are considered.

d. Wherever the number of installations estimated by GESCOM for the

control period is higher than the estimates based on the CAGRs for

the period FY10 – FY15 and for the period FY12 - FY15, the estimates

based on the higher of the CAGRs for the period FY10 – FY15 and

for the period FY12 - FY15 are considered.

e. For LT 4b and 4c, LT-7, HT-2(c), HT-4 and HT-5 categories, the

estimates of GESCOM are retained as there is no specific growth

pattern in these categories.

Based on the above approach, the total number of installations

(excluding BJ/KJ and IP installations) estimated by the Commission

lxxii

for the control period is indicated in the table below:

Nos.

FY17 FY18 FY19

Filed Approved Filed Approved Filed Approved

1911643 1948758 1998201 2037740 2096282 2134376

2) Energy Sales other than BJ/KJ & IP Sets:

i) For categories other than BJ/KJ and IP sets, generally the sales

are estimated considering the following approach:

a. The base year sales for FY16 as estimated by GESCOM are

validated duly considering the actual sales up to November,

2015 and modified suitably.

b. Wherever the sales estimated by GESCOM for the control period

is within the range of the estimates based on the CAGR for the

period FY10 – FY15 and for the period FY12 - FY15, the estimates

of GESCOM are retained.

c. Wherever the sales estimated by GESCOM for the control period

is lower than the estimates based on the CAGRs for the period

FY10 – FY15 and for the period FY12- FY15, the estimates based

on the lower of the CAGRs for the period FY10 – FY15 and for the

period FY12 - FY15 are considered.

d. Wherever sales estimated by GESCOM is higher than the

estimates based on the CAGRs for the period FY10 – FY15 and

for the period FY12 - FY15, the estimates based on the higher of

the CAGRs for the period FY10 – FY15 and for the period FY12 -

FY15 are considered.

lxxiii

e. For LT 4b and 4c, LT-7, HT-2(c), HT-4 and HT-5 categories, the

estimates of GESCOM are retained as there is no specific growth

pattern in these categories.

Based on the above approach, the sales (excluding BJ/KJ and IP sales)

estimated by the Commission the control period is indicated in the

table below:

Figures in MU

FY17 FY18 FY19

Filed Approved Filed Approved Filed Approved

3496.89 3471.76 3756.52 3703.70 4033.60 3952.64

ii) Sales to BJ/KJ :

The break-up of sales to BJ/KJ installations as filed by GESCOM for FY-15

is as indicated below:

lxxiv

Particulars No. of

Installations

Consumption

in MU

Specific consumption

per installation per

month (kWh)

Installations

consuming less than

or equal to18 units

545251 114.70 17.53

Installations

consuming more than

18 units and billed

under LT2(a)

31525 26.82 70.89

Considering the above specific consumption and considering the

number of installations as proposed by GESCOM, the sales approved

for the control period for BJ/KJ is as indicated below:

MU

Particulars FY17 FY18 FY19

Installations consuming less than

or equal to18 units

118.60 120.04 121.61

Installations consuming more than

18 units and billed under LT2(a)

25.86 26.17 26.51

iii) I.P set sales projections for FY 17-19

In its Tariff Order dated 6th May, 2013, the Commission had approved

the specific consumption of IP sets as 9,838 units/installation/annum for

the entire control period of FY14 to FY16 by considering the existence

of unauthorized IP sets in the distribution system. However, the

Commission had revised the specific consumption as 9,503 units /

installation/annum from 9,838 units/installation/annum for the FY16

based on the projection made by the GESCOM in its tariff filing for the

FY16. The GESCOM has reported the total sales of 2,981.55 MU against

3,05,670 numbers of IP set installations serviced, which translates into a

specific consumption of 9,946 units / installation / annum for the FY15. It

is observed that the actual specific consumption achieved by the

GESCOM for the FY15 is more than the approved figure of 9,838 units /

lxxv

installation / annum by 108 units /installation/annum. The approved

sales quantity for the FY15 was 2,924.50 MU. This indicates an increase

in sales to an extent of 57.05 MU to that of approved quantum for the

FY15.

It is noted that the GESCOM has achieved a specific consumption of

9,946 units/installation/annum on the basis of IP sets consumption

reported by it for the FY15. The Commission also notes that the

GESCOM has submitted in its reply to the Commission’s observations on

the APR for the FY15, the data of IP sets consumption based on

agricultural feeders in respect of 325 feeders for only two months in the

FY16. Therefore, it is not correct to project the specific consumption as

well as the total IP set sales for the FY17 to the FY19 on the basis of only

two months’ consumption data. Further, it is also noted that the

specific consumption can be arrived at accurately because of the

availability of IP set consumption data based on the meters from the

agricultural feeders due to segregation of a large number of feeders

under NJY as rural & agricultural feeders and also regulating the hours

of power supply on these feeders.

Hence, in the absence of relevant data for a full year, it is appropriate

to consider the specific consumption of 9,503 units/installation/annum

which was approved for the FY16 by the Commission for the FY17 to

the FY19 also. In view of this, the Commission decides to approve the

specific consumption of 9,503 units / installation / annum for the FY17 to

the FY19.

It is noted that the GESCOM has projected the number of IP set

installations as 3,24,832, 3,35,485 and 3,46,780 for the FY17, FY18 and

FY19 respectively in the present tariff filing. However, during the

validation meeting held on 10.2.2016 in the Commission, the GESCOM

has submitted the revised number of installations as 3,37,483, 3,58,483,

3,80,483 and 4,03,483 for FY16, FY17, FY18 and FY19 respectively. In view

of this, the Commission has considered the revised number of IP sets

lxxvi

furnished by the GESCOM for the FY17 to FY19. Hence, based on the

estimated number of installations for the FY17 to the FY19 duly factoring

the revised number of installations furnished by the GESCOM, the

midyear number of installations is determined and the sales to the IP set

consumers are indicated as below:

lxxvii

Particulars As filed by the GESCOM in its application As approved by the Commission

FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19

No of

installations

3,14,782 3,24,832 3,35,485 3,46,780 3,37,48

3

3,58,483 3,80,483 4,03,483

Mid-Year no of

installations

3,53,390 3,85,203 4,17,016 3,47,983 3,69,483 3,91,983

Specific

consumption in

units/installation/

annum

9,986 9,861 9,765 9,503 9,503 9,503

Sales in MU 3,193.63 3,255.74 3,331.01 3,306.88 3,511.19 3,725.01

Accordingly, the Commission approves 3,306.88 MU, 3,511.19 MU and

3,725.01 MU as energy sales to IP sets as against the GESCOM’s sales

projections of 3,193.63 MU, 3,255.74 MU and 3,331.01 MU respectively

for the FY17, FY18 and FY19. Further, any variation in sales in the FY17

would be trued up during the Annual Performance Review for the FY17

based on the energy consumption in respect of agricultural feeders

segregated under NJY.

The above approved IP set consumption is with the assumption that the

Government of Karnataka would release full subsidy to cover the

approved quantum. However, if there is any variation in the subsidy

allocation by the GoK, the quantum of power to be supplied to IP sets

of 10 HP and below shall be proportionately regulated. The payment of

subsidy by the GoK on supply to IP sets is detailed in Chapter 6 of this

Order.

The Commission reiterates that the GESCOM shall report the total IP set

consumption only on the basis of data from energy meters in respect of

agricultural feeders segregated under NJY, to the Commission every

month, regularly duly deducting the actual distribution system losses

prevailing in 11 KV lines, distribution transformers and LT lines,

calculated as per the methodology approved by the Commission.

Further, the GESCOM is directed to adhere to the duration of power

supply stipulated by the Government in respect of arranging power

supply to exclusive agricultural feeders. The Commission also directs

lxxviii

the GESCOM to take up enumeration of IP sets in its jurisdiction in order

to identify defunct/dried up wells & un-authorized IP sets in the field

and take necessary action to arrive at correct number of IP sets in its

account on the basis of enumeration report. The compliance

regarding the same shall be submitted to the Commission within six

months from the date of issue of this order.

Based on the above discussions, the category-wise approved number

of installations for the control period vis-à-vis the estimates made by

GESCOM is indicated below:

TABLE – 5.3

Category wise approved number of installations

Category

FY-17 FY-18 FY-19

GESCOM’s

estimate

Approved GESCOM’s

estimate

Approved GESCOM’s

estimate

Approved

No. No. No. No. No. No.

LT-2a* 1538146 1570058 1593978 1628462 1654783 1689106

LT-2b 3978 4131 4318 4484 4768 4867

LT-3 236074 242198 247512 254358 260224 267130

LT-4 (b) 2129 2129 2665 2665 3335 3335

LT-4 (c) 490 490 618 618 796 796

LT-5 59625 59483 62866 62829 66292 66363

LT-6 16663 16238 17352 16479 18076 16724

LT-6 14707 14209 16125 15050 17968 15942

LT-7 37495 37495 50226 50226 67279 67279

HT-1 154 150 179 175 208 205

HT-2 (a) 1406 1402 1511 1540 1618 1691

HT-2 (b) 323 323 343 344 365 367

HT2C 82 82 86 86 90 90

HT-3(a)& (b) 307 307 355 356 409 412

HT-4 34 34 36 36 38 38

HT-5 30 30 31 31 33 33

Sub-Total

other than BJ/KJ and IP sets

Other than BJ/KJ & IP

1911643 1948758 1998201 2037740 2096282 2134376

BJ/KJ 551646 551646 558299 558299 565614 565614

IP 324832 358483 335485 380483 346780 403483

Sub Total

BJ/KJ and IP sets

876478 910129 893784 938782 912394 969097

Total** 2788121 2858887 2891985 2976522 3008676 3103473

*Includes BJ/KJ consuming more than 18 units/installation/month

lxxix

Accordingly, the category wise approved sales for the control period

vis-à-vis the estimates made by GESCOM is indicated below:

TABLE – 5.4

Category wise approved Energy Sales

Category

FY-17

FY-18

FY-19

GESCOM’s

estimate

Approved GESCOM’s

estimate

Approved GESCOM’s

estimate

Approved

MU MU MU MU MU MU

LT-2a* 1065.65 1068.07 1142.50 1136.65 1230.15 1209.73

LT-2b 9.20 9.20 9.80 9.86 10.36 10.58

LT-3 289.14 289.14 310.72 311.31 335.66 335.18

LT-4 (b) 11.81 11.81 12.99 12.99 14.29 14.29

LT-4 (c) 1.44 1.44 1.59 1.59 1.75 1.75

LT-5 173.18 172.17 176.92 174.86 181.34 177.60

LT-6 180.07 167.15 197.96 182.29 217.57 198.80

LT-6 245.73 237.51 270.18 252.42 297.04 268.26

LT-7 18.43 18.43 20.28 20.28 22.30 22.30

HT-1 86.23 86.87 89.65 91.46 94.09 96.29

HT-2 (a) 1195.45 1192.42 1287.96 1268.36 1377.91 1349.14

HT-2 (b) 72.19 72.19 77.80 77.98 83.40 84.23

HT2C 11.95 11.95 12.58 12.58 13.22 13.22

HT-3(a)& (b) 117.65 114.63 126.21 131.68 134.52 151.26

HT-4 13.31 13.31 13.63 13.63 13.96 13.96

HT-5 5.46 5.46 5.75 5.75 6.04 6.04

Sub-Total

other than BJ/KJ and IP sets

Other than BJ/KJ & IP

3496.89 3471.76 3756.52 3703.70 4033.60 3952.64

BJ/KJ 117.56 118.60 127.90 120.04 138.64 121.61

IP sets 3193.63 3306.88 3255.74 3511.19 3331.01 3725.01

Sub Total

BJ/KJ and IP sets

3311.19 3425.48 3383.64 3631.23 3469.65 3846.62

Total 6808.08 6897.24 7140.16 7334.92 7503.25 7799.25

*Includes BJ/KJ consuming more than 18 units/installation/month

5.2.3 Distribution Losses for FY17-19:


As per the audited accounts for FY15, the GESCOM has reported

distribution losses of 18.93% as against an approved loss level of 18.50%.

lxxx

The Commission in its Tariff Order dated 2nd March, 2015 had fixed the

target level of losses for FY16 at 16.50%. GESCOM in its filing has

proposed to achieve the following loss levels during FY17-19:

TABLE – 5.5

Projected Distribution Losses-FY17-19 – GESCOM’s Submission

Figures in % Losses


Projected

Distribution losses

17.60 17.00 16.49

Commission’s Analysis and Decisions:

The performance of GESCOM in achieving the loss targets set by the

Commission in the past six years is as follows:

TABLE – 5.6

Approved & Actual Distribution Losses-FY10 to FY16

Figures in % Losses

Particulars FY10 FY11 FY12 FY13 FY14 FY15 FY16

Approved Distribution

losses

24.02 23.00 21.00 19.50 20.00 18.50 16.50

Actual distribution

losses

25.53 22.03 21.71 18.97 17.77 18.93 -

The Commission notes that the loss reduction achieved by GESCOM in

the control period FY11-13 was 6.56 percentage point. In the

preceding years of FY14 & FY15, the loss reduction has been 0.04

percentage point (in two years of the control period FY14-16). Overall

in the past five years GESCOM has been able to achieve distribution

loss reduction of 6.60 percentage point.

The distribution losses in FY15 have increased to 18.93% from 17.77% in

the previous year. GESCOM has not explained the reasons for such

lxxxi

increased losses. The Commission notes that the losses reported by

GESCOM show inconsistent reduction in each control period.

The distribution loss projections projected by GESCOM shows reduction

from existing levels of 18.93% in FY15 to 17.60% in FY17 and further

reduction 0.60% in FY18 and 0.50% in FY19. It is observed that, the

Commission has been allowing capital expenditure as incurred by

GESCOM and has also allowed the capex as proposed for the ensuing

control period. The majority of the capex like HVDS, E&I works, NJY,

DTC metering, RAPDRP should enable GESCOM not only to strengthen

its infrastructure but also reduce the distribution losses.

The loss reduction proposed by GESCOM is not commensurate with the

proposed capex. Hence, the Commission, during the validation

meeting stressed upon the need of further reduction in the distribution

loss levels proposed by GESCOM for the control period FY17-19 duly

considering the past and the present capex for which GESCOM

agreed with the suggestions of the Commission.

Considering the present loss levels and the investments made in the

past besides the proposed capex in the ensuing control period, the

Commission decides to fix the following distribution loss targets for FY17-

19:

TABLE – 5.7

Approved Distribution Losses for FY17-19

Figures in % Losses


Upper limit 17.50 16.50 15.50

Average 17.00 16.00 15.00

Lower limit 16.50 15.50 14.50

5.2.4 Power Purchase for FY17-19:

lxxxii

The ESCOMs in their filings, have submitted the D-1 statement where in

the requirement of power purchase for the control period has been

furnished. The consolidated statement showing the energy

requirement, year-wise is shown hereunder:

lxxxiii

TABLE – 5.8

Consolidated requirement of electricity

As filed by ESCOMs

Distribution Utilities Energy

(MU) Energy (MU) Energy (MU)

FY17 FY18 FY19

BESCOM 32907.24 34674.06 36540.95

MESCOM 5589.96 5904.27 6236.49

CESC 7214.18 7725.09 8274.48

HESCOM 13738.00 13942.08 14849.40

GESCOM 8559.14 8902.63 9292.18

HRECS 322.87 350.14 372.61

AQUEOS 12.98 17.78 22.46

MSEZ 80.49 89.33 113.06

TOTAL 68424.40 72168.78 76161.08

GESCOM’s submission:

The GESCOM has submitted its power purchase requirement for the

control period FY17 to FY19 based on the projected sales as follows:

TABLE – 5.9

GESCOM’s Proposal

Particulars

As filed by GESCOM

FY 17 FY18 FY19

Sales (MU) 6808.08 7140.14 7503.25

Distribution losses (%) 17.60 17.00 16.50

Energy at IF point (MU) 8262.23 8602.58 8985.93

Transmission Losses (%) 3.47 3.37 3.27

Energy Required to meet the

sales of GESCOM (MU) 8559.24 8902.60 9289.70


The validation of sales and allowable distribution losses has been

discussed in the previous section of this chapter. Based on the

lxxxiv

approved sales and the allowable distribution losses, the requirement

of Power for the GESCOM, for the control period FY17 to FY19 is worked

out as detailed below:

TABLE – 5.10

Power Purchase requirement approved for the control period

FY17 to FY19

Particulars Approved by the Commission

FY 17 FY18 FY19

Sales (MU) 6897.24 7334.92 7799.25

Distribution losses (%) 17.00 16.00 15.00

Energy at IF point (MU) 8309.93 8732.05 9175.59

Transmission Losses (%) 3.47 3.37 3.27

Energy Required to meet the

sales of GESCOM (MU) 8608.65 9036.58 9485.77

5.2.5 Sources of Power:

GESCOM’s submission;

In its filings, the GESCOM has furnished the sources of Power to meet

the requirement of Power of all ESCOMs for the control period FY17 to

FY19. It is submitted that, the source-wise energy availability and

related costs have been considered in the filing based on KPCL, CGS,

Major IPPs, NCE sources and others, such as Jurala, TB Dam and short

term purchases.

Commission’s analysis and decisions

The energy requirement of the ESCOMs, including GESCOM, is being

met by Karnataka Power Corporation Limited (KPCL) Generating

stations, Central Generating Stations (CGS), Major Independent Power

producers (IPPs) and Minor Independent Power producers (NCE

sources) through long-term power purchase agreement. The

contingent requirement to meet the deficit is being met through

purchases from Short/Medium term sources by calling for bids and also

lxxxv

purchases from the Power Exchange. Hence, to arrive at the available

quantum of energy and power for the control period FY17 to FY19, the

Commission has considered the availability as furnished by KPCL and

by SRPC/CERC/CEA for CGS, in respect of their respective Generating

Stations. The availability of CGS stations is based on the share of

Karnataka, as notified from time to time.

In the case of Minor IPPs (NCE/RE sources), the actual generation

capacity contracted by the ESCOMs, as indicated in D-1 format has

been considered. The availability from the other sources such as Jurala

Hydel Station and TB dam Power Stations of Telangana State are taken

at 50% and 20 % of their installed capacity respectively as the share of

Karnataka, as per the contracts executed with these generators.

Further, as the Short Term Power/Medium Term Power procurement to

an extent of around 1108.80 MU has already been contracted by

ESCOMs till May, 2016, the same has been considered towards

availability for FY17.

The availability as furnished by the KPCL in respect of Yeramarus Unit-1

& Unit-2 and Yelahanka Combined Cycle Power Plant (YCCPP), having

a capacity of 1600 MW and 350 MW respectively, has not been

considered, as the said generating stations are yet to be synchronized

with the grid and the CoD is yet to be declared. Similarly, Kudagi Unit1,

Unit2 and Unit3, having a total capacity of 2400 MW, are not

considered since they are yet to be synchronized with the grid and

CoD is yet to be declared.

The availability of BTPS unit 3 has been considered, since it has been

synchronized and supplying power to the grid. As its commissioning

date and Commercial operation date is yet to be declared by the

KPCL, the quantum of energy is restricted to the requirement of

ESCOMs and allowed fuel expenses in FY17. For FY18 and FY19, the

availability of energy from this unit has been considered, as furnished

lxxxvi

by the KPCL, duly limiting the quantum of energy as per the

requirement of ESCOMs, to meet the sales targets.

Based on the above availability criteria, the energy allowed for the

State to the extent required to achieve the sales target of the

respective years, is given in the following Table:

TABLE - 5.11

ABSTRACT OF POWER PURCHASE OF ESCOMS FOR THE

CONTROL PERIOD FY17 TO FY19

SOURCES

FINANCIAL YEAR 2016-17 FINANCIAL YEAR 2017-18 FINANCIAL YEAR 2018-19

Energy

in MU

Cost in Rs

Cr

Per unit

Cost

Energy in

MU

Cost in Rs

Cr

Per unit

Cost

Energy in

MU

Cost in Rs

Cr

Per

unit

Cost

in Rs.

KPCL Hydel

Energy 10704.90 1001.38 0.94 12045.33 1099.16 0.91 12045.33 1139.37 0.95

KPCL Thermal

Energy 17646.77 7252.08 4.11 19323.50 8392.29 4.34 20992.89 9198.23 4.38

CGS Energy 21525.17 6980.84 3.24 21525.17 7082.24 3.29 21525.17 7184.17 3.34

UPCL 7462.68 3093.67 4.15 7462.68 3129.03 4.19 7462.68 3165.10 4.24

Renewable

Energy 6846.71 2790.38 4.08 8394.81 13413.83 4.07 10265.57 4452.20 4.34

Other State

Hydel 144.08 67.73 4.70 144.08 71.64 4.97 144.08 75.78 5.26

Short Term 1108.80 558.84 5.04 0.00 0.00 0.00 0.00 0.00

PGCIL &

POSOCO

Charges - 949.21 0.44 958.70 0.45 968.29 0.45

KPTCL

Transmission

and SLDC &

PGCIL

POSOCO

Charges - 3112.76 0.48 3197.08 0.47 3500.45 0.50

TOTAL 65439.11 25806.89 3.94 68895.57 27343.97 3.97 72435.72 29683.58 4.10

5.2.6 GESCOM’s Power Purchase cost and Transmission Charges:

GESCOM’s Submission

The GESCOM has submitted the Power Purchase cost including the

transmission charges and LDC charges, in D-1 Format wherein energy

lxxxvii

to an extent of 8559.14 MU, 8902.63 MU and 9292.18 MU at a cost of

Rs.2768.948 Rs.3693.72 and Rs.3986.92 for the control period years of

FY17, FY18 and FY19 respectively.

As regards power purchase cost, the GESCOM has submitted that, the

source-wise energy and its costs are considered as per the agreed

contracts/regulations and based on the tariff furnished by KPCL for

KPCL Stations and the tariff determined by the CERC in respect of

Central Generating Stations, DVC Stations and UPCL stations. Further, it

is submitted that, the average cost without escalation, paid towards

the supply of NCE during FY15 is considered in arriving the cost of NCE

for the control period FY 17 to FY19.

Commission’s analysis and decisions

After a detailed analysis of the tariff rates claimed by the GESCOM, the

Commission has arrived at the power purchase cost to be allowed in

the ARR for the control period.

The basis for computation of power purchase cost for the control

period FY17 to FY19 is as indicated below:

The fixed charges and variable charges of RTPS Unit 1 to 7, BTPS unit 1

and the Hydel Generating Stations exclusive of Muinirabad, MGHE,

Shiva & Shimsha, are reckoned based on the respective PPAs

approved by the Commission.

The fixed charges and variable charges of Muinirabad, MGHE, Shiva &

Shimsha hydel Stations, BTPS Unit 2 and RTPS unit 8, have been

computed based on the tariffs determined by the Commission and the

Commission’s norms approved in the PPAs.

The fixed charges and variable charges for the Central Generating

Stations, UPCL Station and the Stations of DVC are reckoned based on

the tariffs determined by the CERC and the CERC norms.

lxxxviii

The variable charges of all the thermal stations including CGS stations

are reckoned based on the recent landed cost of fuel and other

variable components.

The variations, if any, in these allowed costs, will be considered during

the FAC exercise / Annual Performance Review of FY17.

Based on the allowed requirement of energy and the power allocation

given by the Government of Karnataka, the Power Purchase quantum

and its costs are approved in the ARR of GESCOM for the control

period FY17 to FY19, as shown in Annexure- 1 & 2.

The consolidated power purchase cost allowed by the Commission vis-

a-vis the power purchase cost as filed by the HESCOM for the control

period FY17 to FY19 is shown the following table:

TABLE – 5.12

Approved Power Purchase Cost of GESCOM for FY17

Source of Power

Power Purchase Cost as filed by

GESCOM

Power Purchase Cost Approved by

the Commission

Energy in

MU

Cost in Rs

Cr

Per Unit

cost in

Rs

Energy in

MU

Cost in Rs

Cr

Per Unit

cost in Rs

KPCL Hydel Energy 3418.33 226.60 0.663 2322.59 178.368 0.768

KPCL Thermal Energy 2136.16 942.09 4.410 1556.80 656.915 4.220

CGS Energy 2150.05 733.59 3.412 2945.31 955.197 3.243

UPCL 135.41 51.93 3.835 1021.13 423.311 4.146

Renewable Energy 591.39 253.65 4.289 591.38 262.836 4.444

Others 15.02 5.66 3.770 19.72 9.268 4.701

Short Term 112.78 57.29 5.080 151.718 76.467 5.040

PGCIL & POSOCO

Charges 108.30 0.504 129.881 0.441

KPTCL Transmission and

SLDC & PGCIL POSOCO

Charges 389.83 0.455 405.490 0.471

TOTAL 8559.140 2768.948 3.235 8608.648 3097.731 3.598

lxxxix

TABLE – 5.13


Source of Power

Power Purchase Cost as filed

by GESCOM

Power Purchase Cost

Approved by the Commission

Energy

in MU

Cost in

Rs Cr

Per Unit

cost in

Rs

Energy

in MU

Cost in

Rs Cr

Per Unit

cost in

Rs



CGS Energy 2847.52 1031.37 3.622 2888.503 950.379 3.290

UPCL 61.91 27.43 4.430 1001.431 419.890 4.193


Others -392.92 -153.02 3.895 19.335 9.613 4.972

PGCIL & POSOCO Charges 164.89 0.579 128.650 0.445

KPTCL Transmission and SLDC &

PGCIL POSOCO Charges 425.27 0.478 391.740 0.434

TOTAL 8902.630 3693.722 4.149 9036.580 3582.528 3.964

TABLE – 5.14


Source of Power

Power Purchase Cost as filed

by GESCOM

Power Purchase Cost


Energy

in MU

Cost in

Rs Cr

Per Unit

cost in

Rs

Energy

in MU

Cost in

Rs Cr

Per Unit

cost in

Rs



CGS Energy 3106.87 1135.30 3.654 2869.569 957.738 3.338

UPCL 61.91 27.70 4.474 994.867 421.946 4.241


Others -542.59 -215.76 3.977 19.208 10.102 5.259

PGCIL & POSOCO Charges 188.81 0.608 129.084 0.450

KPTCL Transmission and SLDC

& PGCIL POSOCO Charges 460.71 0.496 414.180 0.437

TOTAL 9292.18 3986.92 4.291 9485.773 3845.24 4.054

xc

The GESCOM shall regulate the quantum and cost of power for the

control period, as approved by the Commission. However, since the

power purchase costs are uncontrollable as per MYT Regulations, any

excess quantum or cost will be trued up in Annual Performance Review

of the respective years.

The energy and cost in respect of new generating stations/ sources, is

provisionally allowed subject to approval of the Power Purchase

Agreements, by the Commission.

The Commission has fixed a ceiling rate of Rs.4.50 per unit for short-term

procurement and the same is retained for the year FY17.

The Commission notes that, the procurement of power under short

term/medium term has come down significantly over the years. With a

view to reduce the cost of power procurement by avoiding purchase

of high cost energy, the Commission reiterates its earlier directive that,

any short-term/ contingent power procurement over and above the

approved rate Rs.4.50 per Kwh, shall be made by the ESCOMs only

with the prior approval of the Commission.

The Commission also reiterates that any short-term or medium-term

power procurement to be made over and above the approved

quantities shall be procured only through competitive bidding, duly

complying with the GoI guidelines, issued in the matter from time to

time.

5.2.7 Renewable Purchase Obligation (RPO) target for FY17

a. Non-Solar RPO

GESCOM has submitted that it will only be able to achieve non-solar

RPO of 4.87% as against target of 5.50% for FY17 specified by the

Commission vide its (Procurement of Energy from Renewable

Sources)(Third Amendment) Regulations, 2015.

xci

The Commission has approved power purchase quantum of 8608.65

MU for FY17. The Non-solar RPO target would be 473.48 MU. The

purchase of non-solar energy approved is 439.54 MU and the purchase

of solar energy approved is 151.84MU. Considering the purchase of

solar energy of 87.28 MU in excess of solar RPO target, GESCOM will be

able to achieve 526.82 MU of non-solar RPO as against the target of

473.48 MU. Thus, the GESCOM would be able to meet its anticipated

non-solar RPO .

In case, there is any need to buy RECs to meet the RPO, the cost

thereon would be factored in the APR of FY17.

b. Solar RPO

GESCOM has submitted that it will be able to achieve solar RPO target

of 1.77% as against the target of 0.75% specified for FY17.

The Commission has approved power purchase quantum of 8608.65

MU for FY17. The Solar RPO target would be 64.56 MU. The Commission

has approved purchase of 151.84 MU of Solar energy. Thus, the

GESCOM would be able to meet its anticipated solar RPO. As stated

above, the Commission has accounted the additional solar energy

proposed to be purchased for meeting the non-solar RPO target.

In case, there is any need to buy RECs to meet the RPO, the cost

thereon would be factored in the APR of FY17.

5.2.8 O & M Expenses for FY17-19:

GESCOM’s Proposal:

The GESCOM in its application has requested the Commission to

approve O&M Expenses based on the projected R&M Expenses, A&G

Expenses and Employee cost considering the following assumptions:

i. The A&G Expense and R&M Expenses are projected considering the

actual expenses incurred in the past three years.

xcii

ii. The Employee cost is projected based on 2.5% increase in the basic

pay of FY15 for onward projection for FY16-19.

iii. 15% increase in pay for FY17 on account of proposed revision of pay

scales.

iv. Additional employee cost of Rs.32.36 Crores, Rs.49.80 Crores and

Rs.58.35 Crores for FY17, FY18 and FY19 respectively on account of

proposed recruitment for different cadres.

v. Terminal benefits are estimated with an increase of 2-4%.

vi. Other allowances are considered at an increase of 15% annually.

Based on the above GESCOM has sought approval of following O & M

expenses for FY17-19:

TABLE – 5.15

O&M Expenses for FY17-19-GESCOM’s Proposal

Amount in Rs. Crores Particulars FY17 FY18 FY19

R&M cost 46.94 52.54 58.83

Employee cost 443.99 501.97 634.44

A&G expenses 93.23 103.79 115.97

Total O&M cost 584.16 658.30 809.24

Commission’s analysis &decision:

As per the norms specified under the MYT Regulations, the O & M

expenses are controllable expenses and the distribution licensee is

required to regulate these expenses, within the permissible values.

The Commission in its preliminary observations sought details of the

increase in employee cost due to additional recruitment projected for

FY17-19.

xciii

GESCOM in its replies has stated that, about 1532 officers / employees

are proposed to be recruited during FY17-19 and the additional cost

would be Rs.32.36 Crores in FY17, Rs.49.80 Crores in FY18 and Rs.58.35

Crores in FY19.

GESCOM has not informed the status of the recruitment and the

proposed induction of such additional employees. In the absence of

supporting data for claiming such additional employee cost due to

recruitment, the Commission is of the view that such expenses could

be factored in, only after completion of recruitment and induction of

staff and the expenses on such recruitment having been incurred by

the distribution licensee. Further, the Commission is of the view that

any increase in the employee strength should reflect in improved

productivity, increased revenue and efficiency for the betterment of

services rendered by the ESCOMs to its consumers in the State.

Accordingly, the Commission will look into the issue at the time of

approving the APR for relevant years instead of loading these costs

upfront, in the present ARR exercise, before finalization of recruitment

of additional staff.

The Commission has computed the O & M expenses for FY17-19, duly

considering the actual O & M expenses of FY15 as per the audited

accounts (being the latest data available as per the audited

accounts) to arrive at the O & M expenses for base year i.e. FY16. The

actual O& M expenses for FY15 were Rs.367.90 Crores. Considering the

Wholesale Price Index (WPI) as per the data available from the Ministry

of Commerce & Industry, Government of India and Consumer Price

Index (CPI) as per the data available from the Labour Bureau,

Government of India and adopting the methodology followed by

CERC with CPI and WPI in a ratio of 80: 20, the allowable inflation rate

for FY17 is computed as follows:

TABLE – 5.16

Computation of Inflation Index for FY17

Year WPI CPI

Composite

Series Yt/Y1=Rt Ln Rt

Year (t-

1)

Product [(t-

1)* (LnRt)]

xciv

2003 92.6 107 104.12

2004 98.72 111.1 108.624 1.04 0.04 1 0.04

2005 103.37 115.8 113.314 1.09 0.08 2 0.17

2006 109.59 122.9 120.238 1.15 0.14 3 0.43

2007 114.94 130.8 127.628 1.23 0.20 4 0.81

2008 124.92 141.7 138.344 1.33 0.28 5 1.42

2009 127.86 157.1 151.252 1.45 0.37 6 2.24

2010 140.08 175.9 168.736 1.62 0.48 7 3.38

2011 153.35 191.5 183.87 1.77 0.57 8 4.55

2012 164.93 209.3 200.426 1.92 0.65 9 5.89

2013 175.35 232.2 220.83 2.12 0.75 10 7.52

2014 182 246.9 233.92 2.25 0.81 11 8.90

A= Sum of the product column 35.36

B= 6 Times of A 212.19

C= (n-1)*n*(2n-1) where n= No of years of data=12 3036.00

D=B/C 0.07

g(Exponential factor)= Exponential (D)-1 0.0724

e=Annual Escalation Rate (%)=g*100

7.24

For the purpose of determining the normative O & M expenses for

FY17-19, the Commission has considered the following:

e) The actual O & M expenses allowed for FY15 inclusive of

contribution to Pension and Gratuity Trust.

f) The three year compounded annual growth rate (CAGR) of the

number of installations considering the actual number of

installations as per audited accounts up to FY15 and as projected

by GESCOM for FY16-FY19.

g) The weighted inflation index (WII) at 7.24% as computed above.

h) Efficiency factor at 2% as considered in the earlier two control

periods.

The above said parameters are computed duly considering the same

methodology as followed in the earlier orders of the Commission.

Accordingly, the normative O & M expenses for FY17-19 are as follows:

TABLE – 5.17

Approved O & M expenses for FY17-19


xcv

Particulars FY16 FY17 FY18 FY19

No. Of Installations 2858887 2976522 3103473

CGI based on 3 Year CAGR 4.61% 4.69% 4.44%

Inflation index 7.24% 7.24% 7.24%

Base Year O&M Cost (as per actuals of

FY15) 400.99

Approved O&M Expenses 440.47 484.22 531.07

Since, the base year data of the O & M expense includes the

contribution to the P & G Trust, the Commission has not considered

allowing contribution to the P & G Trust separately.

Thus, the Commission decides to approve O&M expenses of Rs.440.47

Crores for FY17, Rs.484.22 Crores for FY18 and Rs.531.07 Crores for FY19.

5.2.9 Depreciation:


The GESCOM, in its application has claimed the depreciation for the

control period based on the following assumptions:

1) Depreciation rates as specified by CERC on the Assets for each

year of the control period.

2) Depreciation is withdrawn on the assets created on account of

contribution /grants as per Accounting Standard-12 .

Accordingly, GESCOM has claimed the depreciation for FY17-19 as

detailed below:

TABLE – 5.18

Depreciation-FY17-19- GESCOM’s Proposal



Depreciation

175.2

9

201.3

5 226.43

Less withdrawals on assets created out of 23.28 24.66 25.82

xcvi

consumer contribution/grants

Net Depreciation

152.0

1

176.6

9 200.60

Commission’s analysis and decision:

In accordance with the provisions of the MYT Regulations and

amendments thereon, the Commission has determined the

depreciation for FY17-19 considering the following:

a) The actual rate of depreciation of category wise assets is

determined considering the depreciation and gross block of

opening and closing balance of fixed assets as per the audited

accounts for FY15.

b) This actual rate of depreciation is considered to on the gross block

of fixed assets projected by the Commission on the amount of

capex recognized for the purpose of factoring depreciation for

FY17-19.

c) The depreciation on account of assets created out of consumers

contribution / grants are considered (deducted) based on the

opening and closing balance of such assets as proposed by the

GESCOM at the weighted average rate of depreciation as per

actuals in FY15.

Accordingly, the depreciation for FY17-19 are as follows:

TABLE – 5.19

Approved Depreciation for FY17-19



Buildings 1.63 1.92 2.20

Civil 0.00 0.00 0.00

Other Civil 0.06 0.06 0.06

Plant & M/c 26.25 27.38 27.44

xcvii

Line, Cable Network 119.97 138.06 154.64

Vehicles 0.21 0.24 0.27

Furniture 0.23 0.27 0.30

Office Equipments 0.24 0.27 0.30

Sub Total 148.59 168.20 185.21

Less Depreciation withdrawn

on assets created out of

consumer

contribution/grants

23.59 24.86 25.99

Net Depreciation 125.00 143.35 159.22

Thus, the Commission decides to approve an amount of Rs.125.00

Crores, Rs. 143.35 Crores and Rs.159.22 Crores towards depreciation for


xcviii

5.2.10 Interest on Capital Loans:

GESCOM’s proposal:

GESCOM in its application as per Format D-9 has requested to approve

interest on capital loans for FY17-19 as follows:

TABLE – 5.20

Interest on Capital Loans– GESCOM’s Proposal



Interest on capital loans 143.04 161.26 169.78


The Commission notes the capex and capital loans proposed for the

control period FY17-19. As discussed in the preceding paragraphs of

this chapter, based on the capex recognized, the requirement of loan

capital is Rs.350 Crores for each year of the control period. Further, the

Commission has considered the repayment of long term loan as

proposed by the GESCOM at Rs.96.37 Crores, Rs.115.25 Crores and

Rs.138.52 Crores for FY17, FY18 and FY19 respectively.

As per the audited accounts of FY15, the GESCOM had incurred

weighted average rate of interest of 11.60% on capital loans. This rate

of interest is considered for the existing loan balances for which interest

has to be factored during FY17-19. As discussed in the preceding

paragraphs, the Commission has considered capex amount of Rs. 500

Crores for each year of the control period for the purpose of factoring

interest on loan. The Commission has considered new loans which is in

compliance with the debt equity ratio of 70:30.

xcix


institutions are charged mainly on the basis of base rate of interest

notified by RBI from time to time plus of certain basis points depending

upon the tenure of the loan. Hence, the Commission would consider

the same approach in factoring interest on the new capital loans. As

per the data furnished by GESCOM, the long term loans are being

availed with interest rate ranging from 9% to 12.75% mainly from PFC &

REC. The Commission notes that the interest rates availed by GESCOM

is on a higher side as compared to other ESCOMs. GESCOM needs to

initiate financial prudence measures so as to avail loans at

comparatively lesser interest rates and reduce its interest burden on

consumers. However, considering the base rate of interest with spread

of 200 basis points and noting the present interest rates, the

Commission decides to allow capital loans at an interest rate of 12% for

FY17-19.

It shall be noted that, the rate of interest now considered by the

Commission on the new capital loans for the control period is subject

to review during APR and revision of ARR of the relevant years of the

control period.

Accordingly, the approved interests on capital loans for FY17-19 are as

follows:

TABLE – 5.21

Approved Interest on Capital Loans for FY17-19



Opening balance of capital loans 863.85 1117.48 1352.23

Add: new capital Loans 350 350 350

Less: Repayments 96.37 115.25 138.52

Total capital loan at the end of the year 1117.48 1352.23 1563.71

Average capital Loan 990.67 1234.86 1457.97

Approved Interest on capital loans 115.59 143.91 169.78

c

Thus, the Commission decides to approve interest on capital loans of

Rs.115.59, Rs.143.91 Crores and Rs.169.78 Crores for FY17, FY18 and

FY19 respectively.

ci

5.2.11 Interest on Working Capital Loan:



interest on working capital loan for FY17-19 as follows:

TABLE – 5.22

Interest on Working Capital loan for FY17-19 – GESCOM’s Submission



Interest on Working Capital loan 93.74 99.51 106.50


As per the norms specified under the MYT Regulations, the Commission

has computed the interest on working capital which consists of one

months’ O & M expenses, 1% of opening GFA and two month’s

revenue.


institutions are charged mainly on the basis of base rate of interest

notified by RBI from time to time with a spread of certain basis points

depending upon the tenure of the loan. Hence, the Commission

would consider the same approach in factoring interest on working

capital loan. As per the replies furnished by GESCOM, it is stated that,

the short term loans/overdrafts has been availed at the rate of interest

of 13.80% during FY16. The Commission notes that, the present short

term loans availed by GESCOM is comparatively at a higher rate of

interest. GESCOM needs to initiate financial prudence measures in

availing short term loans so that the interest burdens on its consumers

cii

are reduced. However, considering the present base rate of interest

with spread of 250 basis points and the reported rate of interest on

short term loans, the Commission decides to allow interest on working

capital loans at 12% for FY17-19.

Accordingly, the approved interest on working capital for FY17-19 are

as follows:

TABLE – 5.23

Approved Interest on Working Capital for FY17-19


Particulars FY 17 FY 18 FY 19

One-twelfth of the amount of O&M Exp. 36.71 40.35 44.26

Opening GFA 3022.75 3527.21 3894.78

Stores, materials and supplies at 1% of

Opening balance of GFA 30.23 35.27 38.95

One-sixth of Revenue 608.05 646.63 687.57

Total Working Capital 674.98 722.26 770.77

Rate of Interest (% p.a.) 12.00% 12.00% 12.00%

Approved Interest on Working Capital 81.00 86.67 92.49

Thus, the Commission decides to approves interest on working capital

of Rs.81.00, Rs.86.67 Crores and Rs.92.49 Crores for FY17, FY18 and FY19

respectively.

5.2.12 Interest on Consumer Security Deposit:



for interest on consumer security deposit for FY17-19 as follows:

TABLE – 5.24

Interest on Consumer Security Deposits for FY17-19- GESCOM’s Proposal



ciii

Proposed interest on consumer security deposits 35.29 37.05 38.90


In accordance with the KERC (Interest on Security Deposit) Regulations

2005, the interest rate to be allowed is the bank rate prevailing on the

1st of April of the financial year for which interest is due. As per Reserve

Bank of India notification dated 29th September, 2015, the bank rate is

7.75%. This being the latest notified bank rate, the Commission has

considered the same for computation of interest on consumer security

deposits for FY17-19.

The Commission has considered the deposits as per audited accounts

of FY15 and half yearly accounts of FY16 for onward projection for

FY17-19. The interest on consumer security deposits for FY17-19 are as

follows:

TABLE – 5.25

Approved Interest on Consumer Security Deposits for FY17-19



Opening balance of consumer security

deposits 437.92 472.92 509.92

Rate of Interest at bank rate to be allowed

as per Regulations 7.75% 7.75% 7.75%

Approved Interest on Consumer Security

Deposits 35.29 38.08 41.07

Thus, the Commission decides to approve interest on consumer

security deposits at Rs.35.29, Rs.38.08 Crores and Rs.41.07 Crores for


5.2.13 Interest on belated payment of power purchase cost:

civ

GESCOM in its application has requested to allow an amount of

Rs.217.76 Crores, Rs.245.49 Crores and Rs.273.50 Crores for FY17, FY18

and FY19 respectively towards interest on belated payment of power

purchase cost. Since interest on working capital is being allowed

separately as per the norms for managing the day to day expenditure

of the company inclusive of payment of monthly power purchase bills

without any delay, the Commission decides not to allow interest on

belayed payment of power purchase cost separately.

5.2.14 Interest and Finance charges Capitalised:

GESCOM has claimed an amount of Rs.7.87 Crores, Rs.4.49 Crores and

Rs.4.28 Crores towards capitalization of interest and finance charges

during FY17, FY18 and FY19 respectively. Considering the capital

expenditure and capitalisation thereon in the previous year, the

Commission decides to allow capitalization of interest and finance

charges as proposed by GESCOM for the control period FY17-19.

The abstract of approved interest and finance charges for FY17-19 are

as follows:

TABLE – 5.26

Approved Interest and finance charges for FY17-19



Interest on Capital Loan 115.59 143.91 169.78

Interest on Working Capital loan 81.00 86.67 92.49

Interest on belated payment of power

purchase cost 0.00 0.00 0.00

Interest on Consumers Security Deposit 35.29 38.08 41.07

Interest & Finance charges capitalised (7.87) (4.49) (4.28)

Approved Interest & Finance Charges 224.01 264.18 299.07

5.2.15 Other Debits:

GESCOM in its application has claimed an amount of Rs.31.60 Crores,

Rs.34.76 Crores and Rs.38.24 Crores towards other debits during FY17,

FY18 & FY19 respectively. The Commission has not been considering

cv

the projections of other debits for the reason that, the same cannot be

estimated beforehand. The Commission therefore has not allowed the

same in the ARR for the control period. However, such expenses would

be considered as per the audited accounts for the relevant years at

the time of APR.

5.2.16 Net Prior Period Credit / Charges:

GESCOM in its application has claimed net prior period credit /

charges of Rs.14.00 Crores, Rs.5.00 Crores and Rs.5.00 Crores for FY17,

FY18 & FY19 respectively. The Commission has not been considering

the projections of net prior period credit / charges for the reason that,

the same cannot be estimated beforehand. The Commission therefore

has not allowed the same in the ARR for the control period. However,

such expenses would be considered as per the audited accounts for

the relevant years at the time of APR.

5.2.17 Return on Equity:


GESCOM in its application has claimed Return on Equity inclusive of

MAT at 19.377% for the control period FY17-19 as detailed below:

TABLE – 5.27

Return on Equity for FY17-19-GESCOM’s Proposal



Paid Up Share Capital 737.16 767.16 797.16

Share Deposit 0.00 0.00 0.00

Reserves and Surplus (268.10) (177.22) (62.90)

Total Equity 469.06 589.94 734.26

Return on Equity 90.89 114.31 142.28


cvi

The Commission has considered the actual amount of share capital,

share deposits and the accumulated profit/losses under reserves &

surplus as per the audited accounts for FY15 for arriving at the

allowable equity base for the control period FY17-19.

The Commission, in accordance with the provisions of the MYT

Regulations has considered 15.5% of Return on Equity duly grossed up

with the applicable Minimum Alternate Tax (MAT) of 21.342%. This

works out to 19.706% per annum. Further, an amount of Rs.22.00 Crores

of recapitalized consumer security deposit as networth is considered as

per the orders of the Hon’ble Appellate Tribunal for Electricity in

Appeal No.46/2014.

Further, in compliance with the orders of the Hon’ble ATE in Appeal

No.46/2014 wherein it is directed to indicate the opening and closing

balances of gross fixed assets along with break-up of equity and loan

component in the Tariff Order henceforth, the details of GFA, debt and

equity (networth) for FY17-19 are as follows:

TABLE – 5.28

Status of Debt Equity Ratio for FY17-19


Year Particulars GFA Debt Equity

(Networth)

Normative

Debt @

70% of

GFA

Normative

Equity @

30% of

GFA

%age

of

actual

debt

on

GFA

%age

of

actual

equity

on

GFA

FY17 Opening

Balance

3022.70 863.85 270.63

Closing

Balance

3527.21 1117.48 312.58 2469.05 1058.16 31.68% 8.86%

FY18 Opening

Balance

3527.21 1117.48 312.58

Closing

Balance

3894.78 1352.23 361.03 2726.35 1168.43 34.72% 9.27%

FY19 Opening

Balance

3894.78 1352.23 361.03

Closing

Balance

4286.39 1563.71 416.99 3000.47 1285.92 36.48% 9.73%

From the above table it is evident that the debt equity lies within the

normative debt equity ratio of 70:30 on the closing balances of GFA for

each year of the control period. Further, the Commission will review

cvii

the same during the Annual Performance Review for each year based

on the actual data as per the audited accounts.

Accordingly, the Return on Equity that could be approved for FY17-19

works out as follows:

TABLE – 5.29

Approved Return on Equity for FY17-19



Paid Up Share Capital 305.14 305.14 305.14

Share Deposit 372.02 372.02 372.02

Reserves and Surplus (384.53) (342.58) (394.13)

Less Recapitalised Security Deposit (22.00) (22.00) (22.00)

Total Equity 270.63 312.58 361.03

Return of Equity 53.33 61.60 71.14

Thus, the Commission decides to approve Rs.53.33 Crores, Rs.61.60

Crores and Rs.71.14 Crores as return on equity inclusive of MAT for FY17,

FY18 and FY19 respectively.

5.2.18 Other Income:


GESCOM has claimed other income for the control period as detailed

below:

TABLE – 5.30

Other Income – GESCOM’s Proposal



Other Income 41.30 44.38 47.77


cviii

The other income received by GESCOM mainly includes interest on

bank deposits, rent from staff quarters, profit on sale of stores, rebate

for collection of electricity duty, income from sale of scrap and

miscellaneous recoveries besides incentives for timely payment of

power purchase bills.

Based on the other income earned by GESCOM in the previous years,

the normal other income works out to Rs.43.00 Crores per year. The

approved other income for the control period are as follows:

TABLE – 5.31

Approved Other Income for FY17-19

Rs. Crores


Other Income 46.00 48.00 50.00

5.2.19 Fund towards Consumer Relations / Consumer Education:

The Commission has been allowing an amount of Rs.0.50 Crore per

year towards consumer relations / consumer education. This amount

is earmarked to conduct consumer awareness and grievance

redressal meetings periodically and institutionalize a mechanism for

addressing common problems of the consumers. The Commission has

already issued guidelines for consumer education and grievance

redressal activities.

The Commission decides to continue providing an amount of Rs.0.50

Crore for each year of the control period FY17-19 towards meeting the

expenditure on consumer relations / consumer education.

The Commission directs GESCOM to furnish a detailed plan of action

for utilization of this amount and also maintain a separate account of

these funds and furnish the same at the time of APR.

5.3 Treatment of Regulatory Asset:

cix

GESCOM in its application has claimed an amount of Rs. 152.94 Crores

as Regulatory asset to be recovered in the ARR for FY17.

The Commission notes that as per the Tariff Order dated 12th May, 2014

the deficit of Rs.110.26 Crores for FY13 was determined duly factoring

the additional subsidy of Rs.52.43 Crores payable by the Government

of Karnataka. This deficit was included in the ARR for FY15. Further,

while approving the ARR for FY15, an amount of Rs.151.73 Crores was

set aside as regulatory asset to be recovered in the tariff over the next

two years (FY16 & FY17). The Commission decided to allow carrying

cost at 12% p.a on the regulatory asset to be assessed at the time of

Annual Performance Review for FY15 and FY16. However, in the present

APR for FY15, as discussed in the previous chapter of this Order, the

revenue earned was more than sufficient to meet the expenses during

FY15. The APR of FY15 indicates a surplus of Rs.69.43 Crores.

Further, the Commission in its Tariff Order dated 2nd March, 2015 had

decided to carry forward a Regulatory asset of Rs.152.94 Crores being

determined as detailed below:

Sl.

No Particulars

Amount

in

Rs Crs

1 Regulatory asset as per Commission’s Order dated 12th May, 2014. 151.73

2 Surplus in revenue on APR of FY14 43.37

3 Deficit as per ARR for FY16. 145.35

4 Total Gap for FY16 253.71

5 Additional revenue allowed by revision of tariff in FY16 115.77

6 Balance unfilled gap in revenue 137.95

7 Net of Incentive/ disallowance 14.99

8 Regulatory asset to be recovered in FY17 152.94

Thus, the Commission decides to include this amount of Rs.152.94

Crores in the ARR for FY17.

cxi

5.4 Abstract of ARR for FY16:

In the light of the above analysis and decisions of the Commission, the

following is the approved ARR for the control period FY17-19:

TABLE – 5.32

Approved ARR for FY17-19


Sl.

No Particulars FY17 FY18 FY19

Revenue at existing tariff

1 Revenue from tariff and Misc. Charges 2080.33

2 Tariff Subsidy 1567.96

3 Total Existing Revenue 3648.29


4 Power Purchase Cost 2692.24 3190.79 3431.06

5 Transmission charges of KPTCL 402.84 388.58 410.88

6 SLDC Charges 2.65 3.16 3.30

7


transmission 3097.73 3582.53 3845.24

8 O&M Expenses 440.47 484.22 531.07

9 Depreciation 125.00 143.35 159.22


10 Interest on Capital Loans 115.59 143.91 169.78

11 Interest on Working capital loans 81.00 86.67 92.49

12 Interest on consumer security deposits 35.29 38.08 41.07


14

Less: interest & other expenses

capitalised 7.87 4.49 4.28

15 Total Interest & Finance charges 224.01 264.18 299.07

16 Other Debits 0.00 0.00 0.00

17 Net Prior Period Debit/Credit 0.00 0.00 0.00

18 Return on Equity 53.33 61.60 71.14

19


Relations/Consumer Education 0.50 0.50 0.50

20 Other Income 46.00 48.00 50.00

21 ARR 3895.05 4488.36 4856.24

22 Surplus/Deficit for FY15 carried forward 69.43

23 Regulatory asset -152.94

24 Net ARR 3978.56 4488.36 4856.24

cxii

5.5 Segregation of ARR into ARR for Distribution Business and ARR for Retail

Supply Business:

GESCOM in its application has not proposed any new ratio for

segregation of consolidated ARR into ARR for Distribution Business and

ARR for Retail Supply Business.

Commission’s Analysis and Decisions:

GESCOM in its application has not proposed any new ratio of

segregation of consolidated ARR into ARR for Distribution Business and

ARR for Retail Supply Business and proposed the same ratio as being

adopted during the previous control period. Thus, the Commission

decides to continue with the existing ratio of segregation of ARR as

detailed below:

TABLE – 5.33

Approved Segregation of ARR – FY17 - 19

Particulars Distribution

Business

Retail Supply

Business

O&M 70% 30%

Depreciation 84% 16%

Interest on Loans 100% 0%

Interest on Consumer Deposits 0% 100%

RoE 84% 16%

GFA 84% 16%

Non-Tariff Income 0% 100%

Accordingly, the following is the approved ARR for Distribution Business

and Retail supply business:

cxiii

TABLE – 5.34 APPROVED REVISED ARR FOR DISTRIBUTION BUSINESS – FY17 - 19


Sl.

No Particulars

FY17 FY18 FY19

1 O&M Expenses 308.33 338.95 371.75

2 Depreciation 105.00 120.41 133.74

Interest & Finance Charges



5 Interest on consumer security deposits 0 0 0


7 Less interest & other expenses capitalised 0 0 0

8 Total 540.57 619.96 693.76

9 ROE 44.80 51.74 59.76

10 ARR 585.37 671.70 753.52

TABLE – 5.35

APPROVED ARR FOR RETAIL SUPPLY BUSINESS – FY17 - 19

Amount in Rs.Crores

Sl.

No Particulars

FY17 FY18 FY19

1 Power Purchase 2692.24 3190.79 3431.06

2 Transmission Charges 405.49 391.74 414.18

3 O&M Expenses 132.14 145.27 159.32

4 Depreciation 20.00 22.94 25.47

Interest & Finance Charges



7 Interest on consumer security deposits 35.29 38.08 41.07

8 ROE 8.53 9.86 11.38

9 Other Income 46.00 48.00 50.00

10

Fund towards Consumer Relations /

Consumer Education 0.50 0.50 0.50

11 ARR 3309.67 3816.66 4102.71

5.6 Gap in Revenue for FY17:

As discussed above, the Commission decides to approve the Annual

Revenue Requirement (ARR) of GESCOM for its operations in FY17 at

Rs.3978.56 Crores as against GESCOM’s application proposing an ARR

of Rs.4378.72 Crores. This ARR includes an amount of Rs.69.43 Crores of

cxiv

surplus revenue earned in FY15 as discussed in Chapter-4 of this Order.

Based on the existing retail supply tariff, the total realization of revenue

will be Rs.3648.29 Crores which is Rs.330.27 Crores less than the

projected revenue requirement for FY17.

The net ARR and the gap in revenue for FY17 are shown in the following

table:

TABLE – 5.36

Revenue gap for FY17

Particulars FY17

Net ARR including carry forward surplus of FY15 (Rs. Crores) 3978.56

Approved sales (MU) 6897.24

Average cost of supply for FY17 ( Rs./unit) 5.77

Revenue at existing tariff (Rs. Crores) 3648.29

Gap in revenue for FY17 (Rs. Crores) (330.27)

The determination of revised retail supply tariff on the basis of the

above approved ARR is detailed in the following Chapter.

5.7 Application for Additional Revenue Requirement for FY17:

The GESCOM, in its application dated 17th March, 2016, filed on 18th

March, 2016, seeking additional ARR for FY17, has submitted that:

1. The Second Transfer Scheme Rules dated 31.05.2002 were issued by

the GoK, for transfer of assets and liabilities and personnel of KPTCL

to the ESCOMs. According to Rule 4(13) of these Rules, the State

Government is responsible for funding the pension and other

liabilities of the personnel as on the date of Second Transfer i.e.

31.05.2002 and sub-rule 13(2)(b) provides for establishment of a

Pension Trust for managing the fund.

2. The GoK, vide its order dated 19.12.2002, has ordered constitution

of the Pension and Gratuity Trust and also decided to adopt “Pay

as you go” approach, in funding the pension and gratuity

requirement.

3. The GoK vide its letter dated 25.02.2016, has informed that against

the proposed pension and gratuity contribution of Rs.996.39 Crores

cxv

for FY17 and the arrears of pension contribution of Rs.2047.84 Crores

payable to KPTCL and the ESCOMs, the Finance Department (FD)

has agreed to provide Rs.550 Crore for meeting the pension liability.

As there is difference between the proposed requirement and the

availability as indicated by the FD for FY17, the Pension Trust is

directed to work out the amount of contribution to be recovered

through tariff, considering the indicative amount of contribution

available from the Government.

4. It is submitted by GESCOM that, as worked out by the Pension Trust,

an amount of Rs.262.49 Crores (Arrears of Rs.217.27 Crores and

Rs.45.22 Crores for FY17), has to be recovered through tariff.

5. Further, GESCOM has submitted that, additional power purchase

cost has to be incurred by the ESCOMs due to outage of

Sharavathi generating Station and consequent revision of

availability of energy, resulting in increase in cost of power

purchases to an extent of Rs.112.86 Crores, for FY17.

Accordingly, GESCOM has filed an application claiming an additional

ARR of Rs.282.63 Crores towards pension and gratuity contribution and

Rs.79.17 Crores towards additional power purchase cost, to be

recovered through tariff.

Commission’s views and decision

The Commission proceeds to dispose of the application filed by

GESCOM, as follows:

a) The application for additional ARR has been filed on 16th March

2016, that is much after completion of the process of calling for

objections on the original tariff application and furnishing replies

thereon. The Commission has also completed the process of public

consultation by holding a public hearing, in respect of GESCOM, on

4th March, 2016.

cxvi

b) As per Rule 4(13) of the Karnataka Electricity Reforms (Transfer of

Undertakings of KPTCL and its Personnel to Electricity Distribution

and Retail Supply Companies) Rules, 2002, notified by the

Government on 31.05.2002, the State Government is liable for

funding the pension and gratuity liability of existing pensioners as on

the effective date of Second Transfer Scheme.

c) The Government, as per its order dated 19.12.2002, has adopted

“pay as you go” approach to meet the pension and gratuity

requirements of existing pensioners on the effective date of second

transfer Scheme. With this arrangement, the GoK is liable to meet

the pension and gratuity requirement of existing pensioners as

noted above. Hence, this liability cannot be passed on to the

consumers, through tariff.

d) The Commission has considered the energy availability from

Sharavathi generating station, as projected by the KPCL, after the

fire accident and the same is factored in the power purchase cost

of BESCOM.

In view of the above, the Commission is unable to accept the

application for approval of additional ARR towards pension and

gratuity of the said pensioners. Accordingly, the said application

stands disposed of.

cxvii

CHAPTER – 6

DETERMINATION OF TARIFF FOR FY17

6.0 GESCOM’S Proposal and Commission’s Analysis for FY17:

6.1 Tariff Application

As discussed in the preceding Chapters, GESCOM has projected an

unmet gap in revenue of Rs.694.42 Crores for FY17. In order to bridge

this gap in revenue, GESCOM, in its Tariff Application, has proposed a

tariff increase of 102 paise per unit in respect of all the categories of

consumers.

6.2 Statutory Provisions Guiding Determination of Tariff

As per section 61 of the Electricity Act 2003, the Commission, is guided

inter-alia, by the National Electricity Policy, the Tariff Policy and the

following factors, while, determining the tariff so that,

the distribution and supply of electricity are conducted on

commercial basis;

competition, efficiency, economical use of resources, good

performance, and optimum investment are encouraged;

the tariff progressively reflects the cost of supply of electricity, and

also reduces and eliminates cross subsidies within the period to be

specified by the Commission;

efficiency in performance is to be rewarded ; and

a multi-year tariff framework is adopted

Section 62(5) of the Electricity Act 2003, read with Section 27(1) of the

KER Act 1999, empowers the Commission to specify, from time to time,

the methodologies and the procedure to be observed by the licensees

in calculating the Expected Revenue from Charges (ERC). The

Commission determines the Tariff in accordance with the Regulations

and the Orders issued by the Commission from time to time.

6.3 Consideration for Tariff setting:

cxviii

The Commission has considered the following relevant factors for

determination of Retail Supply Tariff:

a) Tariff Philosophy:

As discussed in the earlier tariff orders, the Commission continues to

fix tariff below the average cost of supply for consumers whose

ability to pay is considered inadequate and fix tariff at or above the

average cost of supply for categories of consumers whose ability to

pay is considered to be higher. As a result, the system of cross

subsidy continues. However, the Commission has taken due care

to progressively bring down the cross subsidy levels as envisaged in

the Tariff Policy of the Government of India.

b) Average cost of supply:

The Commission has been determining the retail supply tariff on the

basis of the average cost of supply. The KERC (Tariff) Regulations,

2000 require the licensees to provide details of embedded cost of

electricity voltage / consumer category-wise. The distribution

network of Karnataka is such that, it is difficult to segregate the

common cost between voltage levels Therefore, the Commission

has decided to continue the average cost of supply approach for

recovery of the ARR. With regard to the indication of voltage wise

cross subsidy with reference to the voltage-wise cost of supply, the

decision of the Commission is noted in the subsequent para of this

Chapter.

c) Differential Tariff:

Beginning with its tariff order dated 25th November, 2009 the

Commission has been determining differential retail supply tariff for

consumers in urban and rural areas. The Commission decides to

continue the same in the present order also.

cxix

6.4 New Tariff Proposals by GESCOM

GESCOM, in its tariff application has made the following new

proposals:

1. Billing on KVAH basis to EHT/HT consumers:

GESCOM has proposed to introduce KVAH billing in place of the

present system of billing on KWH basis in respect of EHT and HT

consumers with a view to reduce the distribution losses, encourage

effective consumption of electricity by consumers, lower electricity bill

of the consumer and reduce GESCOM energy requirement.

In order to estimate the category-wise KvAh consumption and its

impact on revenue/ consumer tariff/ cross subsidy the Commission has

directed GESCOM to furnish the KvAh consumption data of all its HT

consumers for FY13 to FY15 and FY16 up to November, 2015 and to

rework the financial implication for FY17 on the proposed billing on

KvAh basis for all the HT consumers. But, the required information has

not been submitted by GESCOM. In the absence of any scientific study

and failure on the part of GESCOM to furnish the require data along

with the financial implications, the Commission is unable to take any

decision in the matter and hence decides to continue the existing Kwh

billing system for all the HT consumers.

2. Increase in Fixed Charges:

Other ESCOMs in their applications have proposed to increase the

fixed charges by Rs.10/- to Rs.40/- Per HP/KW/KVA for different

category of consumers.

The Commission has examined the proposal of ESCOMs with respect to

the recovery of fixed charges at existing rates and the fixed

expenditure proposed to be incurred during FY17 and felt necessary

that the fixed expenditure incurred by the ESCOMs need to be

gradually recovered in full in the form of fixed charges.

cxx

On an analysis of the revenue at existing tariff of GESCOM, the

Commission notes that the total amount of fixed charges likely to be

recovered on the projected sales, works out to Rs.203.24 Crores for

FY17. Whereas as per the approved ARR of GESCOM for FY17, the fixed

cost to be incurred in each of the activity in generation, transmission

and distribution is as follows:

(Amount in Rs.Crores)

Activity Total FC to be

incurred

Generation 630.40

Transmission including

SLDC charges

405.49

Distribution network cost 797.31

Total Fixed cost 1833.20

From the above analysis, the Commission notes that as against total

fixed expenditure of Rs.1833.20 Crores, GESCOM is able to collect the

expenditure only to an extent of Rs.203.24 Crores, in the form of fixed

charges at the existing rate this accounts for recovery of only 11.09% of

fixed charges. The remaining 88.91% is being recovered in the form of

energy charges, which is not an efficient method of recovery of fixed

expenditure.

As per the Tariff Policy issued by the Ministry of Power, Government of

India, dated 28th January 2016, two-part Tariff featuring separate fixed

and variable charges shall be introduced for all consumers. In order to

ensure their financial viability it is imperative that the fixed expenditure

incurred by the ESCOMs are recovered in the form of fixed charges.

On study of the existing rate of fixed charges levied on the consumers

and the amount collected thereon, it is observed that fixed charges

needs to be increased gradually to meet the above objective. Hence

the Commission hereby decides to provide for collection of additional

fixed charge of Rs.5/- per KW/HP per month from the Domestic and LT

Industrial consumers and RS.10/- per KW /HP/ KVA per month from all

the other categories of consumers. This would enable the GESCOM to

recover an additional fixed charges from the projected consumers

cxxi

only to the extent of Rs. 28.36 Crores and the projected total recovery

of fixed charges would be Rs.231.60 Crores for FY17 which accounts for

12.63% of the total fixed charges incurred.

3. Other proposals:

GESCOM has made the following proposal:

a) Charge higher tariff to Kalyana Mantapas, where lavish wedding

are taking place.

b) Extend concessional tariff to RO drinking water supply units.

c) Extend concessional rate to Private irrigation installations under HT

supply.

The Commission has examined the above proposals and notes that the

new proposals are not properly justified with financial implications and

hence, decides not to accept the proposals made.

6.5 Revenue at existing tariff and deficit for FY17:

The Commission in its preceding Chapters has decided to carry

forward the surplus in revenue of Rs.69.43 Crores of FY15 to the ARR of

FY17.The gap in revenue for FY17 is proposed to be filled up by revision

of Retail Supply Tariff as discussed in the following paragraphs of this

Chapter.

Considering the approved ARR for FY17 and the revenue as per the

existing tariff, the gap in revenue for FY17 is as follows:

TABLE – 6.1

Revenue Deficit for FY17

Amount in Rs.Crores

Particulars Amount

Approved Net ARR for FY17 including surplus of

FY15

3978.56

Revenue at existing tariff 3648.29

Deficit (330.27)

Additional Revenue to be realised by Revision of

Tariff

330.27

cxxii

Accordingly, in this Chapter, the Commission has proceeded to

determine the retail supply tariff for FY17. The category-wise tariff as

existing, as proposed by GESCOM and as approved by the

Commission is as follows:

1. LT-1 Bhagya Jyothi

The existing tariff and the tariff proposed by GESCOM are given below:

Sl.

No

Details Existing as per

Tariff Order 2015

Proposed by GESCOM

1 Energy Charges

(including recovery

towards service main

charges)

534 Paise / Unit Subject

to a monthly minimum

of Rs.30 per installation

per Month.

636 Paise / Unit Subject

to a monthly minimum

of Rs.30 per installation

per Month.

Commission’s decision

The GoK, as a policy, has extended free power to all BJ/KJ consumers,

whose consumption is not more than 18 units per month. The tariff

payable by these consumers is revised to Rs.5.77 per unit.

Further, the ESCOMs have to claim subsidy for only those consumers

who consume 18 units or less per month per installation. If the

consumption exceeds 18 units per month or any BJ/KJ installation is

found to have more than one out- let, it shall be billed as per the Tariff

Schedule LT 2(a).

The Commission determines the tariff (CDT) in respect of BJ / KJ

installations as follows:

cxxiii

LT – 1 Approved Tariff for BJ / KJ installations

Commission determined Tariff Retail Supply Tariff

determined by the

Commission

577 paise per unit,

Subject to a monthly minimum of

Rs. 30 per installation per month.

-Nil-

Fully subsidized by GoK

*Since GOK is meeting the full cost of supply to BJ / KJ, the Tariff payable by these

Consumers is shown as Nil. However, if the GOK does not release the subsidy in

advance, a Tariff of Rs.5.77 per unit subject to monthly minimum of Rs.30/- per

Installation per month shall be demanded and collected from these consumers.

Note: If the consumption exceeds 18 units per month or any BJ/KJ

installation is found to have more than one light point being

used, it shall be billed as per Tariff Schedule LT 2(a).

2. LT2 (a) Domestic Consumers:


The details of the existing and proposed tariff under this category are

given in the Table below:

Proposed Tariff for LT-2 (a)

LT-2 a (i) Domestic Consumers Category

Applicable to areas coming under City Municipal Corporations and all

Urban Local Bodies

Det

ails

Existing as per 2015 Tariff

Order

Proposed by GESCOM

Fixed

Charges

per Month

For the first KW Rs.25 For the first KW Rs.25

For every additional KW

Rs.35

For every additional KW Rs.35

Energy

Charges

0-30 units

( life line

Consumpti

on )

0 to 30 units:270 paise/unit 0 to 30 units: 372 paise / unit

Energy

Charges

exceeding

30 Units

per month

31 to 100 units:400 paise/unit 31 to 100 units: 502 paise /

unit

101 to 200 units: 540 paise

/unit


/unit

Above 200 units: 640 paise

/unit


/unit

cxxiv

LT-2(a)(ii) Domestic Consumers Category

Applicable to Areas under Village Panchayats

Details Existing as per 2015 Tariff Order

Proposed by GESCOM

Fixed Charges per

Month

For the first KW Rs.15 For the first KW Rs.15

For every additional KW

Rs.25

For every additional

KW Rs.25

Energy Charges

0-30 units ( life line

Consumption )

0 to 30 units:260 paise

/unit


/unit

Energy Charges

exceeding 30 Units

per month


/ unit


/ unit


/unit


/unit


/unit


/unit

Commission’s Views/ Decision

The Commission has decided to continue the two tier tariff in respect

of the domestic consumers as shown below:

(i) Areas coming under city Municipal Corporations and all Urban

Local Bodies

(ii) Areas under Village Panchayats.

The Commission approves the tariff for this category as follows:

cxxv

Approved Tariff for LT 2 (a) (i) Domestic Consumers Category:

Applicable to City Municipal Corporations and all other

Urban Local Bodies.

Details Tariff approved by the

Commission

Fixed Charges per Month For the first KW Rs.30

For every additional KW Rs.40

Energy Charges up to 30 Units per

Month (0-30 Units)-life line consumption.

Upto 30 units: 300 paise/unit

Energy Charges in case the

Consumption exceeds 30 Units per

month

31 to 100 units: 440 paise/unit


Above 200 units: 690 paise/unit

LT-2(a)(ii) Domestic Consumers Category:


Details Tariff approved by the Commission

Fixed Charges per Month For the first KW Rs.20/-

For every additional KW Rs.30/-

Energy Charges up to 30

units per Month (0-30 Units)-

Lifeline Consumption

Up to 30 units: 290 paise/unit

Energy Charges in case the

Consumption exceeds 30

units per Month




3. LT2 (b) Private Professional and other Private Educational Institutions

,Private Hospitals & Nursing Homes.


The details of the existing and the proposed tariff under this

category are given in the Table below:

LT 2 (b) (i) Private Professional and other Private Educational Institutions,

Private Hospitals & Nursing Homes.

Applicable to areas coming under Municipal Corporations

& Urban Local Bodies

cxxvi

Details Existing as per 2015 Tariff Order Proposed by GESCOM

Fixed

Charges per

Month

Rs.35 per KW subject to a

minimum of Rs.65 per month

Rs.35 per KW subject to a

minimum of Rs.65 per

month

Energy

Charges

For the first 200 units: 600

paise per unit

For the first 200 units:702

paise per unit

For the balance units: 720

paise per unit


paise per unit

LT 2 (b) (ii) Private Professional and other Private Educational

Institutions, Private Hospitals & Nursing Homes.



Fixed

Charges per

Month

Rs.25 Per KW subject to a

minimum of Rs.50 per month

Rs.25 Per KW subject to a

minimum of Rs.50 per

month

Energy

Charges

For the first 200 unit: 550

paise per unit

For the first 200 units:652

paise per unit


paise per unit


paise per unit


As in the previous Tariff Order, the Commission decides to continue the

two tier tariff structure as below:

(i) Areas coming under Municipal Corporation and urban local

bodies.


cxxvii

Approved Tariff for LT 2 (b) (i) Private Professional Educational

Institutions& Private Hospitals and Nursing Homes.

Applicable to areas under City Municipal Corporations and all other

urban Local Bodies.


Fixed Charges per Month Rs.45per KW subject to a minimum of Rs.75 per

Month

Energy Charges 0-200 units: 625 paise/unit


Approved Tariff for LT 2 (b) (ii) Private Professional Educational

Institutions& Private Hospitals and Nursing Homes

Applicable in Areas under Village Panchayats


Fixed Charges per Month Rs.35 per KW subject to a minimum of Rs.60per

Month

Energy Charges 0-200 units: 570 paise/unit

Above 200 units:690 paise / unit

4. LT3- Commercial Lighting, Heating and Motive Power


The existing and proposed tariff are as follows:

LT- 3 (i) Commercial Lighting, Heating and Motive Power

Applicable in areas under all Urban Local Bodies including City

Municipal Corporations

Details Existing as per 2015 Tariff

Order

Proposed by GESCOM

Fixed Charges per

Month

Rs.40 per KW Rs.40 per KW

Energy charges For the first 50 units 695

paise per unit

For the first 50 units 797

paise per unit

For the balance units 795

paise per unit


paise per unit

Demand based tariff (optional) where sanctioned load is above 5 KW

but below 50 KW.


Order

Proposed by GESCOM

cxxviii

Fixed Charges Rs.55 per KW Rs. 55 per KW

Energy Charges For the first 50 units 695

paise per unit


paise per unit


paise per unit


paise per unit

LT-3 (ii) Commercial Lighting, Heating& Motive Power

Applicable in areas under Village Panchayats

Details Existing as per 2015

Tariff Order

Proposed by GESCOM

Fixed Charges

per Month


Energy Charges For the first 50 units

645paise per unit


paise per unit

For the balance units

745 paise per unit


847 paise per unit

Demand based tariff (optional) where sanctioned load is above 5 KW

but below 50 KW


Tariff Order

Proposed by GESCOM

Fixed Charges

per Month


Energy Charges For the first 50 units 645

paise per unit


paise per unit


745 paise per unit


847 paise per unit



As in the previous Tariff Order, the Commission decides to continue the

two tier tariff structure as below:

(i) Areas coming under Municipal Corporation and urban local

bodies.


LT- 3 (i) Commercial Lighting, Heating & Motive Power

Applicable to areas under all Urban Local Bodies including

Municipal Corporations

Details Approved by the Commission

Fixed Charges per Month Rs.50 per KW

Energy Charges For the first 50 units: 715 paise/ unit

cxxix

For the balance units: 815paise/unit

Demand based tariff (Optional) where sanctioned load is above 5 kW

but below 50 kW


Fixed Charges per

Month

Rs.65 per KW

Energy Charges For the first 50 units: 715 paise /unit

For the balance units: 815 paise/unit

LT-3 (ii) Commercial Lighting Heating& Motive Power Applicable to areas under Village Panchayats


Fixed Charges per

Month

Rs. 40 per KW

Energy Charges For the first 50 units: 665paise per unit

For the balance units: 765 paise per unit

Demand based tariff (Optional)where sanctioned load is above 5 kW

but below 50 kW


Fixed Charges per

Month

Rs.55 per KW

Energy Charges For the first 50 units: 665 paise per unit

For the balance units: 765 paise per unit

5. LT4-Irrigation Pump Sets:

GESCOM Proposal:

The existing and proposed tariff for LT4 (a) is as follows:

LT-4 (a) Irrigation Pump Sets

Applicable to IP Sets up to and inclusive of 10 HP


Order

Proposed by GESCOM

Fixed Charges per

Month

Nil Free (In case GoK does

cxxx

Energy Charges CDT 455 paise per unit not release the subsidy

in advance, CDT of 557

paise per unit will be

demanded and

collected from

consumers)


The Government of Karnataka has extended free supply of power to

farmers as per Government Order EN 55 PSR 2008 dated 04.09.2008. As

per this policy of GoK, the entire cost of supply to IP sets upto and

inclusive of 10 HP is being borne by the GoK through tariff subsidy. In

view of this all the categories under the existing LT-4a tariff are covered

under free supply of power.

Considering the cross subsidy contribution from categories other than

IP Sets & BJ/KJ Categories, the Commission has determined the tariff for

IP Set under LT4(a) category as follows:

cxxxi

Approved CDT for IP Sets for FY17

Particulars GESCOM

Approved ARR in Rs. Crores 3978.56

Revenue from other than IP & BJ/KJ installations in Rs. Crores 2246.77

Amount to be recovered from IP & BJ/KJ installations in Rs.

Crores 1731.79

Approved Sales to BJ/KJ installations in MU 118.60

Revenue from BJ/KJ installations at Average Cost of supply

in Rs. Crores 68.43

Amount to be recovered from IP Sets category in Rs. Crores 1663.36

Approved Sale to IP Sets in MU 3306.88

Commission Determined Tariff (CDT) for IP set Category for

FY17 in Rs/Unit 5.03

Accordingly, the Commission decides to approve tariff of Rs.5.03 per

unit as CDT for FY17 for IP Set category under LT4(a). In case the GoK

does not release the subsidy in advance, a tariff of Rs.5.03 per unit shall

be demanded and collected from these consumers.


LT-4 (a) Irrigation Pump Sets

Applicable to IP Sets up to and inclusive of 10 HP


Fixed Charges per Month Free*

Energy Charges

CDT (Commission Determined Tariff):

503 paise per unit

* In case the GoK does not release the subsidy in advance, a tariff of

Rs.5.03 per unit shall be demanded and collected from these

consumers.

PAYMENT OF SUBSIDY BY GOVERNMENT OF KARNATAKA FOR FY17:

Several consumers and stakeholders who participated in the Public

Hearing held by the Commission have expressed that the ESCOMs may

be showing part of their technical losses against IP set consumption by

inflating the number of live pump sets, in order to report technical

cxxxii

losses lower than the actual losses prevailing in the distribution system.

Further, they have also expressed that there are many defunct, non-

working/idle IP sets provided to both open wells and bore wells which

have dried up and the same have not been identified / deleted from

the ledger accounts by the ESCOMs and that the ESCOMs, however,

are treating these IP sets as live IP set installations and claiming subsidy

from the Government, which needs to be stopped immediately. They

have requested the Commission to direct the ESCOMs to take up

enumeration of IP sets in their jurisdiction to identify defunct/dried up

wells and un-authorized IP sets in the field and take necessary action to

arrive at the correct number of IP sets in their account on the basis of

the enumeration report. The Commission is also of the view that IP sets

of defunct /dried up wells should be deleted in the accounts of the

ESCOMs in order to reflect exact numbers of live IP sets and its usage

for claiming subsidy from the Government and more importantly to

assess the performance of the ESCOMs.

The Commission has approved in respect of all the ESCOMs, a total

ARR of Rs.31,917.59 Crores for the FY17, which includes estimated

revenue of Rs.8,571.08 Crores against supply of 19,505.96 MU of power

to 25,64,999 number of IP sets (excluding HRECS). The Commission is of

the view that the actual number of IP set installations would be far less

than 25,64,999 approved for the FY17, if proper enumeration is carried

out to ascertain the correct number of IP sets by the ESCOMs.

Therefore, the ESCOMs need to immediately take up enumeration of IP

sets to arrive at the exact number of IP sets in use. The ESCOMs should

note that the quantum of sales to IP sets approved in ARR for FY17 is

subject to APR and the Commission will not accept such sales without

being substantiated in the manner specified by it.

The Commission has been issuing directives to ESCOMs for conducting

Energy Audit at the Distribution Transformer Centre (DTC)/feeder level

to enable detection and prevention of commercial losses. In view of

substantial progress in implementation of feeder segregation under

cxxxiii

NJY scheme, the ESCOMs were also directed to submit IP set

consumption on the basis of the meter readings of the 11 kV feeders at

the substation level duly deducting the energy losses in 11kV lines,

distribution transformers & LT lines, in order to compute the

consumption of power by IP sets accurately. In this regard, the

Commission has noted that the ESCOMs have complied partly with

these directions and they have initiated measures to achieve full

compliance. The ESCOMs need to ensure full compliance as this has

direct impact on their revenues and tariff payable by other categories

of consumers.

For the forgoing reasons, the Commission directs the ESCOMs as

follows:

1) The ESCOMs shall manage supply of power to the IP sets for the

FY17, so as to ensure that it is within the quantum of subsidy

committed by the GoK. They shall procure power which is

proportional to such supply. In case the ESCOMs opt to supply

power to the IP sets in excess of the quantum corresponding to the

amount of subsidy the GoK has assured to be released for FY17, the

difference in the amount of subsidy relating to such supply shall be

claimed from the GoK. If the difference in subsidy is not paid by the

GoK, the same has to be collected from the IP set consumers.

2) The ESCOMs shall, immediately take up enumeration of IP sets,

11kV feeder wise by capturing the GPS co-ordinates namely

longitude, latitude and altitude of each live IP set in their jurisdiction

and complete this process within six months from the date of this

Order and submit the list of 11 kV feeder-wise IP sets’ census with

GPS co-ordinates to the Commission, on or before 15th October,

2016. The Commission would accordingly revise the number of IP

sets and its consumption for the FY17.

3) The ESCOMs shall compute the specific consumption and total sale

of energy to IP sets considering the month-wise energy input to 11

cxxxiv

kV segregated agricultural feeders at the substation duly deducting

the energy losses prevailing in 11 kV lines, DTCs & LT Lines and

submit to the Commission, the monthly DTC wise/ feeder-wise

energy audit reports regularly in the formats prescribed by the

Commission, before 15th of succeeding month.

Pending compliance of the directives contained in (2) and (3) above,

the Commission hereby advises the Government to release only 90% of

the subsidy allocated for FY17. The Commission will advise the

Government, in the last quarter of the financial year to release the

balance 10% of subsidy for the year, on satisfactory compliance of the

above directives.

LT4 (b) Irrigation Pump Sets above 10 HP:

GESCOM’s Proposal

The existing and proposed tariff for LT-4(b) are as follows:

LT-4 (b) Irrigation Pump Sets:

Applicable to IP Sets above 10 HP


Order

Proposed by GESCOM

Fixed Charges per

Month

Rs. 30 per HP Rs.30 per HP

Energy Charges 240 paise per unit 342 paise per unit

The existing and proposed tariff for LT4(c) is as follows:

LT-4 (c) (i) Irrigation Pump Sets :

Applicable to Private Horticultural Nurseries, Coffee and Tea

plantations up to & inclusive of 10 HP


Order

Proposed by GESCOM

Fixed Charges per

Month

Rs.20 per HP Rs.20 per HP


cxxxv

LT-4 (c) (ii) Irrigation Pump Sets:

Applicable to Private Horticultural Nurseries, Coffee and Tea

plantations above 10 HP.


Order

Proposed by GESCOM

Fixed Charges per

Month

Rs.30 per HP Rs.30 per HP


Approved Tariff:

The commission decides to revise the tariff in respect of these

categories as shown below:

LT-4 (b) Irrigation Pump Sets:

Applicable to IP Sets above10 HP

Fixed Charges per Month Rs.40 per HP

Energy Charges for the entire

consumption

280 paise/unit

LT4(c) (i) Irrigation Pump Sets:

Applicable to Horticultural Nurseries,

Coffee, Tea &Rubber plantations up to & inclusive of 10 HP


Energy Charges 280 paise / unit

LT4 (c)(ii) Irrigation Pump Sets:

Applicable to Horticultural Nurseries, Coffee, Tea& Rubber

plantations above 10 HP


Energy Charges 280 paise/unit

cxxxvi

6. LT5 Installations-LT Industries:

GESCOM’s Proposal

The existing and proposed tariffs are given below:

LT-5(a) LT Industries:

Applicable to all areas under GESCOM

i) Fixed charges


ii) Demand based Tariff (optional)

Details Description Existing Tariff as per

2015 Tariff Order

Proposed by

GESCOM

Fixed

Charges

per

Month

Above 5 HP and

less than 40 HP

Rs. 45 per KW of

billing demand

Rs. 45 per KW of

billing demand

40 HP and above

but less than 67 HP

Rs. 60 per KW of

billing demand

Rs. 60 per KW of

billing demand

67 HP and above Rs. 150 per KW of

billing demand

Rs. 150 per KW of

billing demand

iii. Energy Charges


Tariff Order

Proposed by GESCOM

For the first 500 units 475 paise per unit 577 paise/ unit

Fixed Charges per Month

i)Rs. 25 per HP for 5 HP &

below

ii) Rs. 30 per HP for above 5

HP & below 40 HP

iii) Rs. 35 per HP for 40 HP &

above but below 67 HP

iv)Rs. 100 per HP for 67 HP &

above

i) Rs. 25 per HP for 5 HP &

below


HP & below 40 HP




above

cxxxvii

For the next 500

units

555 paise per unit 657 paise/ unit

For the balance

units


LT-5(b) LT Industries:

Applicable to all areas under GESCOM

i) Fixed charges



Details Description Existing Tariff as per

2015 Tariff Order

Proposed by

GESCOM

Fixed

Charges

per

Month

Above 5 HP and

less than 40 HP

Rs. 45 per KW of

billing demand

Rs. 45 per KW of

billing demand

40 HP and above

but less than 67 HP

Rs. 60 per KW of

billing demand

Rs. 60 per KW of

billing demand

67 HP and above Rs. 150 per KW of

billing demand

Rs. 150 per KW of

billing demand

iii. Energy Charges


Tariff Order

Proposed by GESCOM

For the first 500 units 470 paise per unit 572 paise/ unit

For the next 500

units


For the balance 580 paise per unit 682 paise/ unit

Fixed Charges per Month

i)Rs. 25 per HP for 5 HP &

below


HP & below 40 HP




above

i) Rs. 25 per HP for 5 HP &

below


HP & below 40 HP




above

cxxxviii

units

cxxxix

Existing ToD Tariff for LT5 : At the option of the consumers

ToD Tariff

Time of Day Increase (+ )/ reduction (-) in energy

charges over the normal tariff applicable

22.00 Hrs to 06.00 Hrs (-) 125 paise per unit

06.00 Hrs to 18.00 hrs 0

18.00 Hrs to 22.00 Hrs (+) 100 paise per unit

Proposed ToD Tariff for LT5 :At the option of the consumer




06.00 Hrs to 18.00 hrs 0.00

18.00 Hrs to 22.00 Hrs 100 paise per unit

Commission’s Decisions:

Time of the Day tariff:

The decision of the Commission in its earlier Tariff Orders providing for

mandatory Time of Day Tariff for HT2(a), HT2(b) and HT2(c) consumers

with a contract demand of 500 KVA and above is continued. The

optional ToD will continue as existing for HT2(a), HT2(b) and HT2(c)

consumers with contract demand of less than 500 KVA. Further, for LT5

and HT1 consumers, the optional ToD is continued as existing.

The Commission has decided to continue with two tier tariff structure

introduced in the previous Tariff Orders, which are as follows:

i) LT5 (a): For areas falling under Municipal Corporations.

ii) LT5 (b): For areas other than those covered under LT5 (a) above.

cxl

Approved tariff:

The Commission approves tariff under LT-5(a) and LT-5(b) as given

below:

Approved Tariff for LT 5 :

Approved Tariff for LT 5 (a):

Applicable to areas under Municipal Corporations

i) Fixed charges


Fixed

Charges per

Month

i) Rs. 30 per HP for 5 HP & below

ii) Rs. 35 per HP for above 5 HP & below 40 HP

iii) Rs. 40 per HP for 40 HP & above but below 67 HP

iv) Rs. 100 per HP for 67 HP & above

Demand based Tariff (optional)

Fixed

Charges per

Month

Above 5 HP and less than 40

HP

Rs. 50 per KW of billing

demand

40 HP and above but less

than 67 HP

Rs. 65 per KW of billing

demand

67 HP and above Rs. 150 per KW of billing

demand

ii) Energy Charges


For the first 500 units 495 paise/unit

For the next 500 units 585 paise/ unit

For the balance units 615 paise/unit

cxli

Approved Tariff for LT 5 (b):

Applicable to all areas other than those covered under LT-5(a)

i) Fixed charges


Fixed

Charges per

Month

i) Rs 30 per HP for 5 HP & below

ii) Rs. 35 per HP for above 5 HP & below 40 HP

iii) Rs 40 per HP for 40 HP & above but below 67 HP

iv) Rs. 100 per HP for 67 HP & above


Fixed

Charges per

Month


HP

Rs.50 per KW of billing

demand


than 67 HP

Rs 65 per KW of billing

demand

67 HP and above Rs. 150 per KW of billing

demand

iii) Energy Charges

Details Approved tariff

For the first 500 units 485 paise/ unit



Approved ToD Tariff for LT5 :At the option of the consumer

ToD Tariff




06.00 Hrs to 18.00 hrs 0

18.00 Hrs to 22.00 Hrs (+) 100 paise per unit

cxlii

7. LT6 Water Supply Installations and Street Lights


The existing and the proposed tariffs are given below:

LT-6(a) : Water Supply


Order

Proposed by GESCOM

Fixed Charges per

Month

Rs. 35/HP/month Rs. 35/HP/month

Energy Charges 340 paise/unit 442 paise/unit

LT-6 (b) : Public Lighting


Order

Proposed by GESCOM

Fixed Charges

per Month

Rs. 50/KW/month Rs. 50/KW/month

Energy Charges 500 paise/unit 602 paise/unit

Energy Charges

for LED Lighting

400 paise/ unit 502 paise/ unit

The Commission approves the tariff for this category as follows:

Tariff Approved by the Commission for LT-6 (a): Water supply

Details Approved Tariff

Fixed Charges per

Month

Rs. 45/HP/month


Tariff Approved by the Commission for LT-6 (b): Public Lighting


Fixed Charges per

Month

Rs. 60/KW/month


Energy Charges

for LED/ Induction

Lighting

450 paise/unit

8. LT 7- Temporary Installations and Advertising Hoardings:


The existing rate and the rate proposed are given below:

cxliii

Temporary Supply

a) Less than 67

HP:

Energy charge at 900

paise per unit subject

to a weekly minimum

of Rs. 160 per KW of

the sanctioned load.

Energy charge at 1002 paise

per unit subject to a weekly

minimum of Rs. 160 per KW of


TARIFF SCHEDULE for LT-7(b)

a) Less than 67

HP:

Energy charge at 900

paise per unit subject

to a weekly minimum

of Rs.40 per KW of the

sanctioned load.

Energy charge at 1002 paise

per unit subject to a weekly

minimum of Rs.40 per KW of



As decided in the previous Tariff Order, the tariff specified for

installations with sanctioned load / contract demand above 67 HP

shall be covered under the HT temporary tariff category under HT5.

With this, the Commission decides to approve the tariff LT-7 category

as follows:

Details Existing tariff as per

Tariff Order 2015

Proposed by GESCOM


Tariff Order 2015

Proposed by GESCOM

cxliv

APPROVED TARIFF SCHEDULE for LT-7(a)

Applicable to Temporary Power Supply for all purposes.

LT 7(a) Details Approved Tariff

Temporary Power

Supply for all

purposes.

Less than 67 HP:

Energy charges at 950 paise / unit

subject to a weekly minimum of Rs.170

per KW of the sanctioned load.

APPROVED TARIFF SCHEDULE for LT-7(b)

Applicable to Hoardings & Advertisement boards, Bus Shelters with

Advertising Boards, Private Advertising Posts / Sign boards in the

interest of public such as Police Canopy Direction boards, and other

sign boards sponsored by Private Advertising Agencies / firms on

permanent connection basis.

LT 7(b) Details Approved Tariff

Power supply on

permanent

connection basis

Less than 67 HP:

Fixed Charges at Rs.50 per KW / month

& Energy charges at 950 paise / unit

H.T. Categories:

Time of the Tariff (ToD)

The Commission decides to continue the mandatory Time of Day Tariff

for HT2(a), HT2 (b) and HT2 (c) consumers with a contract demand of

500 KVA and above. Further, the optional ToD will continue as existing

for HT2 (a), HT2 (b) and HT2 (c) consumers with contract demand of

less than 500 KVA. The details of ToD tariff are indicated under the

respective tariff category.

cxlv

9. HT-1 Water Supply & Sewerage


The Existing and the Proposed tariff are as given below:

Sl.

No.

Details Existing tariff as per 2015

Tariff Order

Proposed tariffs

1 Demand

Charges

Rs.180 / kVA of billing

Demand / month

Rs.180 / kVA for billing

demand / Month

2 Energy Charges 410 paise per unit 512 paise per unit

Existing ToD tariff to HT-1 tariff to Water Supply & Sewerage installations at the option of the consumer

22.00 Hrs to 06.00 Hrs next day (-) 125 Paise per unit

06.00 Hrs to 18.00 Hrs 0

18.00 Hrs to 22.00 Hrs (+) 100 Paise per unit

Proposed ToD Tariff to HT-1

Time of day Increase (+) / reduction (-) in the energy


22.00 Hrs to 06.00 Hrs next day (-) 125 paise per unit

06.00 Hrs to 18.00 Hrs 0


Commission’s decision:

The Commission approves the tariff for HT 1 Water Supply & Sewerage category as below:

Approved Tariff for HT- 1


Demand

Charges

Rs.190 / kVA of billing demand / Month

Energy Charges 450 paise/ unit

Approved ToD tariff to HT-1 tariff to Water Supply & Sewerage installations at the option of the consumer

22.00 Hrs to 06.00 Hrs next day (-)125paise per unit

06.00 Hrs to 18.00 Hrs 0

18.00 Hrs to 22.00 Hrs (+)100 paise per unit





cxlvi

10. HT-2 (a) – HT Industries & HT 2(b) – HT Commercial


The Existing and proposed tariff are as given below:

HT – 2 (a) - HT Industries - Applicable to all areas of GESCOM

Details Existing tariff as per Tariff

Order 2015

Proposed by GESCOM

Demand Charges Rs.170 / kVA of billing

demand / month

Rs.170 / kVA of billing

demand / month

Energy Charges

(iii) For the first one

lakh units

(iv) For the

balance units

585 paise per unit

615 paise per unit

687 paise per unit

717 paise per unit

Railway traction and Effluent Plants


Order 2015

Proposed by GESCOM

Demand Charges Rs. 180 / kVA at billing

demand / Month

Rs. 180 / kVA of billing

demand / Month

Energy Charges 555 paise per unit for all the

units

657 paise per unit for all

the units

cxlvii

Existing ToD Tariff for HT-2(a)



22.00 Hrs to 06.00 Hrs next day (- )125 Paise per unit

06.00 Hrs to 18.00 Hrs 0

18.00 Hrs to 22.00 Hrs (+) 100 Paise per unit

Proposed ToD Tariff for HT-2(a)



22.00 Hrs to 06.00 Hrs next day (-) 125 paise per unit

06.00 Hrs to 18.00 Hrs 0


Commission’s Decision

The Commission approves the tariff for HT 2(a) category as below:

Approved Tariff for HT – 2 (a)

Applicable to all areas of GESCOM


Demand Charges Rs. 180 / kVA of billing demand / Month

Energy Charges

For the first one lakh units 620 paise/ unit

For the balance units 660 paise/ unit

Railway Traction & Effluent Treatment Plants



Energy Charges 590 paise / unit for all the units

cxlviii

11. HT-2 (b) HT Commercial



HT – 2 (b)-HT Commercial - Applicable to all areas of GESCOM


Order 2015

Proposed by GESCOM

Demand Charges Rs. 190 / kVA of billing

demand / month


demand / Month

Energy Charges

(i) For the first two

lakh units

735 paise per unit

837 paise per unit

(ii)For the balance

units

765 paise per unit 867 paise per unit

Proposed ToD Tariff to HT-2(b)



22.00 Hrs to 06.00 Hrs next day -

06.00 Hrs to 18.00 Hrs -

18.00 Hrs to 22.00 Hrs -

Commission’s Decision

The Commission approves the following tariff for HT 2 (b) consumers:

Approved tariff for HT – 2 (b) - HT Commercial

Applicable to all areas of GESCOM



Energy Charges

(i) For the first two lakh units 785 paise per unit

(ii) For the balance units 815 paise per unit

Note: The above tariff under HT2 (b) is not applicable for construction of new

industries. Such S

12 HT – 2 (c) – Applicable to Hospitals and Educational Institutions:


cxlix

HT-2( c)(i)- Applicable to Government Hospitals, Hospitals run by Charitable

Institutions, ESI Hospitals, Universities, Educational Institutions belonging to

Government, Local Bodies and Aided Institutions & Hostels of all educational

institutions.


Tariff Order 2015

Proposed by GESCOM


demand / Month


demand / Month

Energy Charges

(i) For the first one lakh units 560 paise per unit 662 paise per unit

(ii) For the balance units 610 paise per unit 712 paise per unit


HT – 2 (c) (ii)- Applicable to Hospitals/Educational Institutions

other than those covered under HT2(c) (i)


Tariff Order 2015

Proposed by GESCOM


demand / Month


demand / Month

Energy Charges

(i) For the first one lakh units 660 paise per unit 762 paise per unit

(ii) For the balance units 710 paise per unit 812 paise per unit

Commission’s Decisions:

The Commission approves the following tariff for HT-2(c) consumers.

cl

Approved tariff for HT – 2 (c) (i)

Applicable to Government Hospitals, Hospitals run by Charitable Institutions,

ESI Hospitals,

Universities and Educational Institutions belonging to Government & Local

Bodies, Aided Educational Institutions and Hostels of all educational

institutions.


Demand Charges Rs.180 / kVA of billing demand / Month

Energy Charges

(i) For the first one lakh units 600 paise per unit


Approved tariff for HT – 2 (c) (ii)

Applicable to Hospitals and Educational Institutions other than those covered under

HT2(c) (i)



Energy Charges

(i) For the first one lakh units 700 paise per unit


Time of the Day Tariff:

Approved ToD Tariff to HT-2(a), HT- 2(b) and HT2(c)



22.00 Hrs to 06.00 Hrs next day (- ) 125 paise per unit

06.00 Hrs to 18.00 Hrs 0

18.00 Hrs to 22.00 Hrs (+)100paise per unit

cli

13. HT-3(a) Lift Irrigation Schemes under Government Departments /

Government owned Corporations/ Lift Irrigation Schemes under Pvt

/Societies:


The Existing and proposed tariff are given below:

HT 3(a) (i) Applicable to LI Schemes under Government Departments /

Government owned Corporations

Details Existing charges as per tariff

order 2015

Proposed charges by

GESCOM

Energy

Charges/

minimum

Charges

170 paise / unit

subject to an annual minimum

of Rs.1000 per HP / annum

272 paise / unit

subject to an annual

minimum of Rs. 1000

per HP / annum

HT 3(a) (ii) Applicable to Pvt. LI Schemes and Lift Irrigation Societies

fed through Express/ Urban feeders

Details Existing Tariff as per Tariff

Order 2015

Proposed by GESCOM

Fixed Charges Rs. 30 / HP / Month of

sanctioned load

Rs. 30 / HP / Month of

sanctioned load

Energy Charges 170 paise / unit 272 paise / unit

HT 3(a) (iii) Applicable to Pvt. LI Schemes and Lift Irrigation Societies

other than those covered under HT-3 (a)(ii)

Details Existing Tariff as per Tariff

Order 2015.

Proposed by GESCOM

Fixed Charges Rs. 10 / HP / Month of

sanctioned load

Rs. 10 / HP / Month of

sanctioned load

Energy Charges 170 paise / unit 272 paise / unit

clii


The Commission approves the following tariff for HT-3(a) consumers:

Approved tariff for HT-3 (a) (i)

Applicable to LI schemes under Govt. Dept. / Govt. owned Corporations

Energy Charges /

Minimum Charges

200 paise/ unit

subject to an annual minimum of Rs. 1120

per HP / annum

Approved tariff for HT- 3 (a) (ii)

Applicable to Private LI Schemes and Lift Irrigation Societies fed through

express / urban feeders

Fixed Charges Rs. 40 / HP / Month of sanctioned load


Approved tariff for HT 3 (a) (iii)

Applicable to Private LI Schemes and Lift Irrigation Societies

other than those covered under HT 3 (a) (ii)

Fixed Charges Rs. 20 / HP / Month of sanctioned load


14. HT3 (b)- Irrigation & Agricultural Farms, Government Horticulture

farms, Private Horticulture Nurseries, Coffee, Tea, Coconut & Arecanut

Plantations:


The existing and the proposed tariff are given below:

HT3 (b)- Irrigation & Agricultural Farms, Government Horticulture farms,

Private Horticulture Nurseries, Coffee, Tea, Coconut & Arecanut

Plantations:


Order 2015

Proposed tariff by GESCOM

Energy Charges /

minimum

Charges

370 paise / unit


minimum of Rs. 1000 per HP

of sanctioned load

472 paise / unit


minimum of Rs. 1000 per

HP of sanctioned load


cliii

The Commission approves the tariff for this category as indicated

below:

Approved Tariff

HT3 (b)- Irrigation & Agricultural Farms, Government Horticulture farms,

Private Horticulture Nurseries, Coffee, Tea, Rubber, Coconut & Arecanut

Plantations:


Energy Charges /

Minimum Charges

400 paise / unit

subject to an annual minimum

of Rs. 1120 per HP of sanctioned

load.

15. HT4- Residential Apartments/ Colonies:


The existing and proposed tariff for this category are given below:

Existing and proposed tariff for HT – 4 - Residential Apartments/

Colonies Applicable to all areas of GESCOM


Order 2015

Proposed tariff by GESCOM


demand


demand

Energy Charges 550 paise per unit 652 Paise/ unit


The Commission approves the Tariff for this category as indicated

below:

Approved tariff

HT – 4 Residential Apartments/ Colonies Applicable to all areas of

GESCOM

Demand Charges Rs. 110/ kVA of billing demand

Energy Charges 585 paise/ unit

16. TARIFF SCHEDULE HT-5


The existing and proposed tariff for this category are as given below:

cliv

HT – 5 – Temporary supply

67 HP and above:

Existing Proposed

Fixed Charges /

Demand Charges

Rs.210/HP/month for the

entire sanction load /

contract demand

Rs.210/HP/month for the

entire sanction load /

contract demand

Energy Charge 900 paise / unit (weekly

minimum of Rs.160/- per

KW is not applicable)

1002 paise / unit (weekly

minimum of Rs 160/- is not

applicable)

Commission’s decisions:

TARIFF SCHEDULE HT-5

As approved in the Commission’s Tariff Order dated 02nd March 2015,

this tariff is applicable to 67 HP and above hoardings and

advertisement boards and construction power for industries excluding

those category of consumers covered under HT2(b) Tariff schedule

availing power supply for construction power for irrigation and power

projects and also applicable to power supply availed on temporary

basis with the contract demand of 67 HP and above of all categories.

Approved Tariff for HT – 5 – Temporary supply

67 HP and above: Approved Tariff

Fixed Charges /

Demand Charges

Rs.220/HP/Month for the entire sanction load /

contract demand.

Energy Charges 950 paise / unit.

The Approved Tariff schedule for FY17 is enclosed in Annex – IV of this

Order.

6.6 Other Issues

6.6.1 Tariff for Green Power:

In order to encourage generation and use of green power in the State,

the Commission decides to continue the existing Green Tariff of 50

paise per unit as the additional tariff over and above the normal tariff

to be paid by HT-consumers, who opt for supply of green power from

clv

out of the renewable energy procured by distribution utilities over and

above their Renewable Purchase Obligation (RPO).

6.6.2 Determination of wheeling charges for FY17:

GESCOM in their filing have proposed the following Wheeling

charges:

Paise/unit

Injection Point HT LT

Drawal Point

HT 66.21 193.76

LT 193.76 181.33

Further, GESCOM has proposed HT-loss at 8.52% and LT-loss at

7.13%.

Subsequently in their replies to preliminary observations, GESCOM

has proposed the following Wheeling charges:

Paise/unit

Injection Point HT LT

Drawal Point

HT 48[8.52%] 162.00[15.65%]

LT 162.00[15.65%] 114.00[7.13%]

Note: Figures in brackets are losses

GESCOM in their tariff filing has also stated that concessional wheeling

and banking charges to RE sources is affecting their distribution

business and has requested the Commission to maintain parity in

wheeling charges. Also, GESCOM, in its tariff filing has requested the

Commission not to allow banking during the summer months as the

cost of peak power is five to six times the average cost.

clvi

The Commission in its preliminary observations had directed GESCOM

to furnish necessary data in support of its proposal to do away with

banking during summer months.

The Commission notes that GESCOM in its replies has furnished the wheeled

energy data pertaining to few installations that have wheeled energy. The

Commission notes that GESCOM has only furnished data of wheeled energy

and has not justified its stand to show that banking has affected them

financially or there are technical constraints during summer months. As such

the request of GESCOM is not considered.

The approach of the Commission regarding wheeling & banking

charges is discussed in the following paragraphs:

The Commission has considered the approved ARR pertaining to

distribution wires business and has proceeded determining the

wheeling charges as detailed below:

6.6.3 Wheeling within GESCOM Area:

The allocation of the distribution network costs to HT and LT networks for

determining wheeling charges is done in the ratio of 30:70, as was

being done earlier. Based on the approved ARR for distribution

business, the wheeling charges to each voltage level is worked out as

under:

TABLE – 6.2

Wheeling Charges

Distribution ARR-Rs. Crs 585.37

Sales-MU 6897.24

Wheeling charges- paise/unit 84.87

Paise/unit

HT-network 25.46

LT-network 59.41

In addition to the above, the following technical losses are applicable

to all open access/wheeling transactions:

clvii

Loss allocation % loss

HT 7.80

LT 7.26 Note: Total loss is allocated to HT, LT & Commercial loss based on energy flow

diagram furnished by GESCOM.

The actual wheeling charges payable (after rounding off) will depend

upon the point of injection & point of drawal as under:

Paise/unit

Injection point

Drawal point

HT LT

HT 26[7.80%] 85 [15.06%]

LT 85[15.06%] 59[7.26%] Note: Figures in brackets are applicable loss

The wheeling charges as determined above are applicable to all the

open access or wheeling transactions for using the GESCOM network,

except for energy transmitted or wheeled from Renewable sources to

the consumers in the State.

6.6.4 WHEELING OF ENERGY USING TRANSMISSION NETWORK OR NETWORK OF

MORE THAN ONE LICENSEE

In case the wheeling of energy [other than RE sources wheeling to

consumers in the State] involves usage of Transmission network or

network of more than one licensee, the charges shall be as indicated

below:

i. If only transmission network is used, transmission charges

determined by the Commission shall be payable to the

Transmission Licensee.

ii. If the Transmission network and the ESCOMs’ network are used,

Transmission Charges shall be payable to the Transmission

Licensee. Wheeling Charges of the ESCOM where the power is

drawn shall be shared equally among the ESCOMs whose

networks are used.

Illustration:

clviii

If a transaction involves transmission network & GESCOM’s network and

100 units is injected, then at the drawal point the consumer is entitled

for 81.99 units, after accounting for Transmission loss of 3.47% &

GESCOM technical loss of 15.06%.

The Transmission charge in cash as determined in the Transmission Tariff

order shall be payable to KPTCL & Wheeling charge of 85 paise per

unit shall be payable to GESCOM. In case more than one ESCOM is

involved the above 85 paise shall be shared by all ESCOMs involved.

iii. If ESCOMs’ network only is used, the Wheeling Charges of the

ESCOM where the power is drawn is payable and shall be

shared equally among the ESCOMs whose networks are used.

Illustration:

If a transaction involves injection to BESCOM’s network & drawal at

GESCOM’s network, and 100 units is injected, then at the drawal point

the consumer is entitled for 84.94 units, after accounting GESCOM’s

technical loss of 15.06%.

The Wheeling charge of 85 paise per unit applicable to GESCOM shall

be equally shared between GESCOM& BESCOM.

6.6.5 CHARGES FOR WHEELING OF ENERGY BY RE SOURCES (NON-REC ROUTE

) TO CONSUMERS IN THE STATE

The separate orders issued by the Commission from time to time in the

matter of wheeling and banking charges for RE sources (non-rec route

) wheeling energy to consumers in the State shall be applicable.

6.6.6 CHARGES FOR WHEELING ENERGY BY RE SOURCS WHEELING ENERGY

FROM THE STATE TO A CONSUMER/OTHERS OUTSIDE THE STATE AND FOR

THOSE OPTING FOR RENEWABLE ENERGY CERTIFICATE[REC]

clix

In case the renewable energy is wheeled from the State to a consumer

or others outside the State, the normal wheeling charges as

determined in para 6.6.3 and 6.6.4 of this order shall be applicable. For

Captive RE generators including solar power projects opting for RECs,

the wheeling and banking charges as specified in the orders issued by

the Commission from time to time shall be applicable.

clx

6.7 Other tariff related issues:

i) Cross subsidy surcharge:

The Commission notes that GESCOM in its tariff petition has only

indicated the power purchase cost at 5% margin excluding liquid fuel

projects and renewables and has not worked out the CSS.

The determination of cross subsidy surcharge by the Commission is

discussed in the following paragraphs:-

The Commission in its MYT Regulations has specified the methodology

for calculating the cross subsidy surcharge. Based on the above

methodology, the category wise cross subsidy will be as indicated

below:

Particulars

HT-1

Water

Supply

HT-2a

Industries

HT-2b

Commercial

HT-2

(C)

HT3 (a)

Lift

Irrigation

HT3 (b)

Irrigation &

Agricultural

Farms

HT-4

Residential

Apartments

HT5

Temporary

Average Tariff-

Paise/unit 498.81 721.70 902.87 735.25 181.60 398.01 625.67 1509.97

Cost of supply

at 5% margin

@ 66 kV and

above level

565.04 565.04 565.04 565.04 565.04 565.04 565.04 565.04

Cross subsidy

surcharge

paise/unit @ 66

kV & above

level

-66.23 156.66 337.83 170.21 -383.44 -167.03 60.63 944.93

Cost of supply

at 5% margin

@ HT level

607.04 607.04 607.04 607.04 607.04 607.04 607.04 607.04

Cross subsidy

surcharge

paise/unit @ HT

level

-108.22 114.66 295.83 128.21 -425.44 -209.03 18.63 902.94

For the categories where the surcharge is negative, the surcharge is

made zero at the respective voltage level. For the remaining

categories, the Commission decides to determine the surcharge at

75% (instead of the 80% considered in its tariff order dated 02.03.2015)

of the cross subsidy amount as worked out above, as the cross subsidy

surcharge has to be gradually reduced. Thus, the cross subsidy

surcharge is determined as under rounding off to nearest paise:

clxi

Paise/unit

Voltage

level

HT-1 HT-2a HT-2b HT-2c HT-3a HT-3b HT-4 HT-5

66 kV &

above

0 118 253 128 0 0 45 709

HT level-11

kV/33kV

0 86 222 96 0 0 14 677

The cross subsidy surcharge determined in this order shall be

applicable to all open access/wheeling transactions in the area

coming under GESCOM. However, the above CSS shall not be

applicable to captive generating plant for carrying electricity to the

destination of his own use and for those renewable energy generators

who have been exempted from CSS by the specific orders of the

Commission.

The Commission directs the Licensees to account the transactions

under open access separately. Further, the Commission directs the

Licensees to carry forward the amount realized under Open

Access/wheeling to the next ERC, as it is an additional income to the

Licensees.

ii) Rebate for use of Solar Water Heater:

The Commission has decided to retain the existing rebate of 50 paise

per unit subject to a maximum of Rs.50 per installation per month for

use of solar water heaters.

iii) Prompt payment incentive:

The Commission had approved a prompt payment incentive (i) in all

cases of payment through ECS and (ii) in the case of monthly bill

exceeding Rs.1,00,000/- (Rs. One lakh). The earlier rate of incentive was

0.25 % of the bill amount, the Commission decides to continue the

same.

iv) Relief to Sick Industries:

clxii

The Government of Karnataka has extended certain reliefs for revival /

rehabilitation of sick industries under the New Industrial Policy 2001-06

vide G.O. No. CI 167 SPI 2001, dated 30.06.2001. Further, the

Government of Karnataka has issued G.O No.CI2 BIF 2010, dated

21.10.2010. The Commission, in its Tariff Order 2002, has accorded

approval for implementation of reliefs to the sick industries as per the

Government policy and the same was continued in the subsequent

Tariff Orders. In view of issue of the G.O No.CI2 BIF 2010, dated

21.10.2010, the Commission has accorded approval to the ESCOMs for

implementation of the reliefs extended to sick industrial units for their

revival / rehabilitation on the basis of the orders issued by the

Commissioner for Industrial Development and Director of Industries &

Commerce, Government of Karnataka.

v) Power Factor:

The Commission in its previous order had retained the PF threshold limit

and surcharge, both for LT and HT installations at the levels existing as in

the Tariff Order 2005. The Commission has decided to continue the

same in the present order as indicated below:

LT Category (covered under LT-3, LT-4, LT-5 & LT-6 where motive power

is involved): 0.85 and HT Category: 0.90

vi) Rounding off of KW / HP:

In the Tariff Order 2005, the Commission had approved rounding off of

fractions of KW / HP to the nearest quarter KW / HP for the purpose of

billing and the minimum billing being for 1 KW / 1HP in respect of all the

categories of LT installations including IP sets. This shall continue to be

followed. In the case of street light installations, fractions of KW shall be

rounded off to the nearest quarter KW for the purpose of billing and

the minimum billing shall be for a quarter KW.

vii) Interest on delayed payment of bills by consumers:

clxiii

The Commission, in its previous Order had approved interest on

delayed payment of bills at 12% per annum. The Commission decides

to continue the same in this Order also.

viii) Security Deposit (3 MMD/ 2 MMD):

The Commission had issued K.E.R.C. (Security Deposit) Regulations,

2007 on 01.10.2007and the same has been notified in the official

Gazette on 11.10.2007. The payment of security deposit shall be

regulated accordingly, pending orders of the Hon’ble High Court in

WP No.18215/2007.

ix) Mode of Payment by consumers:

The Commission, in its previous Order had approved revenue payment

in cash/cheque/DD of amounts up to and inclusive of Rs.10,000/- and

payment of amounts above Rs.10,000 to be made only through

cheque. The consumers can also make payment of power bills

through Electronic Clearing System((ECS)/ Credit card/ online E-

payment up to the limit prescribed by the RBI.

Other ESCOMs in their applications had proposed to consider the

collection of power supply bills above One lakh rupees, through

RTGS/NEFT. The Commission has examined the request and decides to

approve the payment of power supply bills above One lakh rupees,

through RTGS/NEFT, at the option of the Consumers in all ESCOMs.

clxiv

6.8 Cross Subsidy Levels for FY17:

The Hon’ble Appellate Tribunal for Electricity (ATE), in its order dated 8th

October, 2014, in Appeal No.42 of 2014, has directed the Commission

to clearly indicate the variation of anticipated category-wise average

revenue realization with respect to overall average cost of supply in

order to implement the requirement of the Tariff Policy that tariffs are

within ±20% of the average cost of supply, in the tariff orders being

passed in the future. It has further directed the Commission to also

indicate category-wise cross subsidy with reference to voltage-wise

cost of supply so as to show the cross subsidies transparently.

In the light of the above directions, the variations of the anticipated

category-wise average realization with respect to the overall average

cost of supply and also with respect to the voltage wise cost of supply

of GESCOM and the cross subsidy thereon, is Indicated in ANNEXURE -

III of this Order. It is the Commission’s endeavour to reduce the cross

subsidies gradually as per the Tariff policy.

6.9 Effect of Revised Tariff

As per the KERC (Tariff) Regulations 2000, read with the MYT Regulations

2006, the ESCOMs have to file their applications for ERC/Tariff before

120 days of the close of each financial year in the control period. The

Commission observes that the ESCOMs have filed their applications for

revision of tariff on 15th December, 2015 (within the time extended by

the Commission). As the tariff revision is effective from 1st April, 2016

onwards, ESCOMs would be recovering revenue for eleven months of

the financial year.

A statement indicating the proposed revenue and approved revenue

is enclosed vide Annexure III and detailed tariff schedule is enclosed

vide Annexure IV.

clxv

6.10 Summary of the Tariff Order:

The Commission has approved an ARR of Rs.3978.56 Crores for FY17

which includes the Regulatory Asset of Rs.152.94 Crores with a total

gap in revenue of Rs.330.27 Crores as against GESCOM’s proposed

ARR of Rs.4378.72 Crores.

The Commission has allowed recovery of entire gap in revenue with

additional revenue of Rs.330.27 Crores on Tariff Revision as against

the additional revenue of Rs.694.43 Crores proposed by GESCOM for

FY17.

GESCOM had proposed an increase of 102 paise per unit for all

categories of consumers resulting in average increase in retail supply

tariff by 18.85%. The Commission has approved an average increase

of 48 paise per unit in the tariff. The average increase in retail supply

tariff of all the consumers for FY17 is 9%.

The Commission has allowed for recovery of additional

revenue partly by increase in fixed charges ranging from Rs.5

per KW/HP/KVA to Rs.10 per KW/HP/KVA.

The Commission has allowed for recovery of additional

revenue partly by increase in the energy charges in the range

of 15 paise per unit to 50 paise per unit.

The increase in energy charges for commercial category is 20

paise per unit, for LT Industries category is in the range of 15

paise per unit to 30 paise per unit and for other categories is in

the range of 20 paise per unit to 50 paise per unit.

Time of the day tariff which was made mandatory in the previous

Tariff Orders for installations under HT2 (a), HT2(b) and HT2(c) with

contract demand of 500KVA and above is continued in this Order.

clxvi

Green tariff of additional 50 paise per unit over and above

the normal tariff which was introduced in the previous Tariff

Order for HT industries and HT commercial consumers at their

option, to promote purchase of renewable energy from

ESCOMs is continued in this Order.

As in the previous Orders, the Commission has continued to

provide a separate fund for facilitating better Consumer

Relations /Consumer Education Programs.

The cap on cost of short-term power purchase to meet

shortfall in supply is continued at Rs.4.50 per unit.

6.11 Commission’s Order

1. In exercise of the powers conferred on the Commission under

Sections 62, 64 and other provisions of the Electricity Act, 2003, the

Commission hereby determines and notifies the retail supply tariff of

GESCOM for FY17 as stated in Chapter-6 of this Order.

2. The tariff determined in this order shall be applicable to the

electricity consumed from the first meter reading date falling on or

after 1st April, 2016.

3. This Order is signed dated and issued by the Karnataka Electricity

Regulatory Commission at Bengaluru this day, the 30th March, 2016.

Sd/-

(M.K.Shankaralinge Gowda)

Chairman

Sd/-

(H.D.Arun Kumar)

Member

Sd/-

(D.B.Manival Raju)

Member

clxvii

APPENDIX

ISSUE OF NEW DIRECTIVES AND

REVIEW OF COMPLIANCE OF DIRECTIVES ISSUED BY THE

COMMISSION

1. The following new directive is issued by the Commission

Directive on Energy Conservation:

In view of the increase in cost of electricity and the constraints in

capacity additions to generate additional power to meet the increase

in demand, it is imperative that all the consumers use energy efficient

equipment and adopt energy conservation measures, in their daily

activities to conserve electricity. To achieve this, the Commission has

notified the Demand Side Management Regulations, 2015, on

28.07.2015. As per these Regulations, the ESCOMs have to implement

Demand Side Management (DSM) and Energy Efficiency (EE)

programmes in their jurisdiction, to mitigate peak and energy

shortages by adoption of conservation technologies for more efficient

use of electricity. The objective is to flatten the load curve by reducing

the loads in their respective areas leading to reduction in system peak

load.

The Commission has noted that the ESCOMs have already initiated the

DELP (Domestic Efficient Lighting programme) for supplying/distributing

9 watts capacity LED bulbs to the consumers at a subsidised price. This

initiative will certainly help conserve substantial quantum of energy

used for domestic lighting, provided all the consumers accept and

adopt it.

In addition to the above initiative, the Commission notes that there is a

scope for energy conservation in use of equipment like Air

Conditioners, Fans, Refrigerators etc., in domestic/ commercial and

clxviii

industrial installations. Also, use of LED lamps/energy efficient lamps like

induction lamps in all the streetlight installations including high mast

street light installations should be considered so as to make energy

conservation measures more broad based across wider range of

consumers.

Therefore, the Commission hereby directs the ESCOMs to service all the

new installations only after ensuring that the BEE ***** (Bureau of Energy

Efficiency five star rating) rated Air Conditioners, Fans, Refrigerators,

etc., are being installed in the applicant consumers’ premises.

Similarly, all new streetlight/high mast installations including extensions

made to the existing streetlight circuits shall be serviced only with LED

lamps/energy efficient lamps like induction lamps.

Further, the Commission directs the ESCOMs to take up programmes to

educate all the existing domestic, commercial and industrial

consumers, through media and distribution of pamphlets along with

monthly bills, regarding the benefits of using five star rated equipment

certified by the Bureau of Energy Efficiency in reduction of their

monthly electricity bills and conservation of precious energy.

2. Review of Compliance of Existing Directives:

The Commission had in its earlier tariff orders and other

communications issued several directives for compliance

by the GESCOM. While reproducing such directives, the

compliance of the directives as reported by the GESCOM

is analysed in this Section.

clxix

i. Directive on implementation of Standards of Performance (SoP):

The Directive was:

“The GESCOM is directed to strictly implement the specified

Standards of Performance while rendering services related to

supply of power as per the KERC (Licensee’s Standards of

Performance) Regulations, 2004. Further, the GESCOM is

directed to display prominently both in Kannada and English the

details of various critical services such as replacing the failed

transformers, attending to fuse off call / line breakdown

complaints, arranging new services, change of faulty energy

meters, reconnection of power supply, etc., rendered by it as

per Schedule-1 of the KERC (Licensee’s Standards of

Performance) Regulations, 2004 and Annexure-1 of the KERC

(Consumer Complaints Handling Procedure) Regulations, 2004,

on the notice boards in all the O & M sections and O & M sub-

divisions in its jurisdiction for the information of consumers as per

the following format.

Nature of

Service

Standards of

performance

(indicative

minimum

time limit for

rendering

services)

Primary

responsibility

centers

where to

lodge

complaint

Next higher

Authority

Amount

payable to

affected

consumer

The GESCOM shall implement the above directives within one

month from the date of this order and report compliance to the

Commission regarding the implementation of the directives.”

clxx

Compliance by the GESCOM:

As per the directions of the Commission, the details of the

specified Standards of Performance in accordance with the

KERC (Licensee’s Standards of Performance) Regulations, 2004

and the KERC (Consumer Complaints Handling Procedure)

Regulations, 2004, have been displayed on the notice boards of

all the O&M section and subdivision offices.

The status of implementation of the above directive in the GESCOM is

as follows:

O&M Subdivisions O&M Sections

Total

subdivisio

ns

No. of

subdivisions

where SoP

parameters

have been

displayed

Balance Likely date of

completion

Total

subdivisio

ns

No. of

sections

where SoP

parameters

have been

displayed

Balance

Likely date

of

completion

53 53 0 - 245 245 0 -

Commission’s Views

The Commission notes that the GESCOM has complied with the

directive by displaying the details of specified Standards of

Performance on the notice boards in all its O&M section and

subdivision offices for the information of the consumers. However,

it is also noted that consumers participating in the Public Hearing

held on 4.3.2016 at Kalaburagi, have stated that the details of

SoP are not displayed in many of the O&M sections and also they

are not aware of the services rendered as per SoP. The

Commission directs the GESCOM to arrange to display

prominently both in Kannada and English the details of various

clxxi

services rendered as per SoP wherever it is not provided and to

take up awareness programmes regularly for the benefit of the

consumers besides adhering to the specified standards of

performance while rendering services to ensure that consumer

complaints are attended to in a time bound manner.

The Commission reiterates its directive to the GESCOM to

continue to strictly implement the specified Standards of

Performance while rendering services related to supply of power

as per the KERC (Licensee’s Standards of Performance)

Regulations, 2004. Compliance on the above shall be submitted

to the Commission on a quarterly basis regularly.

ii) Directive on use of safety gear by linemen:

The directive issued was:

The Commission directs the GESCOM to ensure that all the

linemen in its jurisdiction are provided with proper and adequate

safety gear and also ensure that the linemen use such safety

gear provided while working on the network. The GESCOM

should sensitise the linemen about the need for adoption of

safety aspects in their work through suitably designed training

and awareness programmes. The GESCOM is also directed to

device suitable reporting system on the use of safety gear and

mandate supervisory/higher officers to regularly cross check the

compliance by the linemen and take disciplinary action on the

concerned if violations are noticed. The GESCOM shall

implement this directive within one month from the date of this

order and submit compliance report to the Commission.

Compliance of the GESCOM:

Safety helmets along with induction tester and rubber hand gloves

have already been provided to all the field staff. The tendering process

clxxii

for procurement of additional safety gear like reflective jackets,

protective eye wear and leather shoes is in process.

The status of safety gear provided to linemen is as follows:

ESCOM

Total number of

linemen

sanctioned

No. of linemen

provided with

safety gear

No. of linemen

yet to be

provided with

safety gear

Likely date of

providing safety

gear to all

linemen

Regular contract Regular contract Regular contract Regular contract

GESCO

M 5,152 25 1,984 25

755

(2413

vacan

t)

25 March-

2016 -

List of safety gears issued to linemen:

1. Helmet with Electronic Induction tester

2. Pairs of safety Rubber Hand Gloves.

3. Cutting Pliers

4. Live Tester

5. Safety Belt

6. Earthing rod

7. Reflective Jackets

8. Protective eye wear

Commission’s Views:

The Commission notes that the GESCOM has provided safety

gadgets to its linemen and also taken action to provide

additional safety tools required for the linemen working in the

field. It is observed that the GESCOM has not mentioned

anything on reporting system put in place for monitoring the use

of safety gear by linemen and regular cross checking by the

supervisory/higher officers, to ensure compliance of the directive.

Further, it is necessary that the GESCOM should provide the

clxxiii

safety gear to the linemen who are to yet to be provided with

the same, so as to focus on safety aspects to reduce the

electrical accidents. It is also important that the frequency of

imparting training to all the linemen should be increased so that

adherence to safety aspects becomes part of their routine.

The Commission reiterates its directives that the GESCOM shall

ensure that all the linemen in its jurisdiction are provided with

proper and adequate safety gear and the linemen use such

safety gear provided to them, while working on the network. The

compliance in this regard shall be submitted once in a quarter to

the Commission regularly.

iii) Directive on providing Timer Switches to Streetlights by the

ESCOMs

The directive issued was:

The Commission directs the GESCOM to install timer switches using own

funds to all the streetlight installations in its jurisdiction wherever the

local bodies have not provided the same and later recover the cost

from them. The GESCOM shall also take up periodical inspection of

timer switches installed and ensure that they are in working conditions.

They shall undertake necessary repairs / replacement work, if required

and later recover the cost from the local bodies. The compliance

regarding the progress of installation of timer switches to streetlight

installations shall be reported to the Commission within three months of

the issue of the order.


At present condition, it is not possible to provide timer switches to

streetlight installations because, in most of the places the streetlight

lamps are hooked directly to LT circuits due to non-availability of

separate streetlight control wires. In order to connect timer switches to

clxxiv

streetlight installations, a separate phase wire exclusively for streetlight

control needs to be drawn in each DTC. Anyhow, at present to avoid

burning of streetlights continuously, the GESCOM has arranged for

fixing of manual ON & Off switches to each pole wherever such

hooking has been noticed.

Further, the local bodies are not in a position to bear the cost of

providing timer switches to streetlight installations. Therefore, the

GESCOM is planning to take up a scheme for providing timer switches

to streetlight installations at a cost of Rs. 3 crore per taluk. Total

expenditure for this project is Rs. 100 crore and accordingly a provision

is made for the same in the budget for the FY17. The present status is

that a tender was called on 28-09-2015 for carrying out remote

monitoring of energy consumption and billing of water supply &

streetlight installations, including supply, installation and commissioning

of required hardware /software on Total Turnkey basis (BOOM model)

across GESCOM. This also includes associated services like installation

of in-built programmable timers for ‘ON-OFF’ of streetlights from each

of the control points, with 5 years maintenance thereon. The period of

completion is 12 months including monsoon period, from the date of

issue of “Letter of Award”.

The GESCOM requests the Commission to approve this scheme for the

FY17 and issue direction to recover the cost from the GoK through local

bodies.

Commission’s Views

The Commission notes that the GESCOM has not complied with the

directive in respect of providing timer switches to streetlight installations

in its jurisdiction. The Commission also notes the difficulties faced by the

GESCOM in carrying out the directive. However, it is also noted that the

GESCOM has now taken up a project for providing timer switches with

clxxv

control wires and a system for collecting streetlight consumption

regularly in its jurisdiction.

The Commission reiterates that the streetlight installations should be

provided with timer switches for enabling them to be automatically

switched on only during the scheduled time. This measure would not

only save significant quantum of energy that is currently wasted

because of inefficient and unreliable manual operation of the switches

which allow them to be lit unnecessarily even during day time, but also

ensure that streetlights are lit during the scheduled dark hours when

the general public require them. As directed earlier the GESCOM

should install the timer switches at their cost and later recover it from

the local bodies. Persuading the local bodies to fix timer switches at

their own cost availing funds / grants received from Government and

other agencies for such programmes / works should also be explored

seriously.

As regards the request for approval of capital investment for

installation of timer switches, the Commission notes that, the GESCOM

has not indicated the same in its capex proposal for FY17 to FY19.

The Commission further directs the GESCOM that henceforth, the new

streetlight installations and any extension/modification to be carried

out to the existing streetlight installations shall be serviced only with

timer switches.

iv) Directive on Load Shedding:

The Commission had directed that:

(1) Load shedding required for planned maintenance of

transmission /

distribution networks should be notified in daily newspapers at

clxxvi

least 24

hours in advance for the information of consumers.

(2) The ESCOMs shall on a daily basis estimate the hourly

requirement of

power for each sub-station in their jurisdiction based on the

seasonal

conditions and other factors affecting demand.

(3) Any likelihood of shortfall in the availability during the course of

the

day should be anticipated and the quantum of load shedding

should

be estimated in advance. Specific sub-stations and feeders

should be

identified for load shedding for the minimum required period

with due

intimation to the concerned sub-divisions and sub-stations.

(4) The likelihood of interruption in power supply with time and

duration of

such interruption may be intimated to consumers through SMS

and

other means.

(5) Where load shedding has to be resorted due to unforeseen

reduction in the availability of power, or for other reasons,

consumers

may be informed of the likely time of restoration of supply

through SMS

and other means.

(6) Load shedding should be carried out in different sub-stations /

feeders

to avoid frequent load shedding affecting the same sub-stations

/

feeders.

(7) The ESCOMs should review the availability of power with respect

to the

clxxvii

projected demand for every month in the last week of the

previous month and forecast any unavoidable load shedding

after consulting other ESCOMs in the State about the possibility

of inter-ESCOM load adjustment during the month.

(8) The ESCOMs shall submit to the KERC their projections of

availability and demand for power and any unavoidable load

shedding for every

succeeding month in the last week of the preceding

month for

approval.

(9) The ESCOMs shall also propose specific measures for minimizing

load

shedding by spot purchase of power in the power exchanges or

bridging the gap by other means.

(10) The ESCOMs shall submit to the Commission sub-station wise and

feeder

wise data on interruptions in power supply every month before

the 5th

day of the succeeding month.

The Commission had directed that the ESCOMs shall make every effort

to minimize inconvenience to consumers strictly complying with the

above directions. The Commission will review the compliance of the

directions on a monthly basis for appropriate orders.


The GESCOM is submitting 15 minutes block-wise, week ahead

requirement of power and energy for one week in advance to SLDC,

KPTCL, Bangalore. In turn, every day, the SLDC issues availability of

power and energy, one day in advance for the GESCOM. Accordingly

scheduling is done for 220 KV sub-stations.

clxxviii

Whenever there is reduction in generation, the SLDC intimates the

GESCOM for restricting the load. Accordingly, the GESCOM restricts the

load based on the real time schedule given by the SLDC. The load is

restricted as per 220KV substation wise allocation chart and by

communicating the same to all the substations and the concerned

nodal officers for proper monitoring of load shedding timings in

batches. Whenever advance intimation is received from the SLDC

regarding generation loss, the same is being communicated to the

high yielding consumers such as HT & EHT installations to reduce the

load.

The load shedding is being carried out in all the sub-station/feeders as

per the load shedding chart in batches rotation wise and the same is

being monitored by the concerned nodal officers to ensure that

frequent load shedding of the same sub-stations/feeders is avoided.

The GESCOM has submitted the projection of availability and demand

on the basis of source wise availability given by the PCKL. Timings

regarding the availability of power supply/load shedding effected

from 28.02.2015 has been intimated to the Commission.

The GESCOM is submitting feeder wise details such as number of

interruptions and duration of scheduled and unscheduled interruptions

in the prescribed PQM formats to the Commission every month.

The GESCOM is taking all possible measures to minimize the

inconvenience to the consumers and to improve the quality and

reliability of power supply based on the real time schedule allocation

made by the SLDC.

The GESCOM is collecting the consumer Mobile phone numbers to

implement a system for sending the SMSes regarding of load shedding

to be effected due to any reasons and after collecting these details

further action will be taken to intimate the consumers through SMSes.

clxxix


The Commission observes that the GESCOM is not submitting its

projections of availability and demand for power and any

unavoidable load shedding required to be imposed for every

succeeding month, in the last week of the preceding month, to the

Commission, regularly. The GESCOM shall henceforth submit the same

regularly to the Commission. The Commission also notes that the

GESCOM, so far has not taken to put in place a system for providing

information to the consumers through SMSes regarding the schedule of

load shedding. This has to be expedited as the consumers need to be

informed through SMSes in addition to notifications in newspapers

/media regarding load shedding due to reasons such as system

constraints, breakdown of lines/equipment, maintenance etc. This

would address significantly the consumers’ dissatisfaction on this issue.

Further, it is also necessary to avoid load shedding involving the same

sub-stations/feeders; the same should be on rotation basis to avoid

inconvenience to consumers/public.

The Commission reiterates that the GESCOM shall comply with the

directive on load shedding and submit monthly compliance reports to

the Commission regularly.

v) Directive on Establishing a 24X7 Fully Equipped Centralized

Consumer Service Center for Redressal of Consumer Complaints:

The directive was as below:

“The GESCOM is directed to put in place a 24x7 fully equipped

Centralized

Consumer Service Center at its Headquarters with state of the art

facility/system for receiving consumer complaints and monitoring their

redressal so that electricity consumers in its area of supply are able to

seek

clxxx

and obtain timely and efficient services / redressal in the matter of their

grievances. Such a Service Center shall have adequate number of

desk

operators in each shift so that consumers across the jurisdiction of the

GESCOM

are able to lodge their complaints directly with this Centre.

Every complaint shall be received on a helpline telephone number by

the

desk operator and registered with a docket number which shall be

intimated to the Consumer. Thereafter, the complaints shall be

transferred

online / communicated to the concerned field staff for resolving the

same. The concerned O&M / local service station staff shall visit the

complainant’s premises / fault location at the earliest to attend to the

complaints and then inform the Centralized Service Centre that the

complaint is attended. In turn, the call centre shall call the

complainant

and confirm with him whether the complaint has been attended to.

The

complaints shall be closed only after receiving consumer’s /

complainant’s confirmation. Such a system should also generate daily

reports indicating the number / nature of complaints received,

complaints

attended, complaints pending and reasons for not attending to the

complaints.

The GESCOM shall publish the details of the complaint handling

procedure /

Mechanism with contact numbers in the local media periodically for

the

information of the consumers. The compliance of the action taken in

the matter shall be submitted to the Commission within two months

from the date of this Order.

clxxxi

Further, the Commission directs the GESCOM to establish/strengthen

24x7 service stations, equipping them with separate vehicles &

adequate line crew, safety kits and maintenance materials at all its

sub-divisions including rural areas for effective redressal of consumer

complaints.

The Commission also directs the GESCOM to hold Consumer

Interaction Meetings in each O&M sub-division once every two

months according to a

published schedule and invite consumers in advance to participate in

such meetings to sort out their grievances. Such meetings shall be

chaired

by officers of the level of Superintending Engineers and attended by

the

concerned divisional and sub-divisional Engineers. The GESCOM shall

submit

compliance of the same to the Commission once in a quarter.”

Compliance of the GESCOM :

A 24X7, fully equipped Centralized Customer Call Centre is already

established in the Corporate Office, GESCOM, Kalaburugi. There is a

provision for fifteen Desktops (Working Station tables) at this Customer

Call Centre. The short code Telephone number ‘1912’ is implemented

from 01-02-2015, for receiving the consumers’ complaints and it is also

connected with online system.

At present, twelve operators and five Junior Engineers are handling the

complaints in the Customer Centre. In each shift, four operators and

one Junior Engineer are working to attend consumer calls. Twelve shift

operators are engaged from Outsource Agency.

The Complaints received under the supervision of Junior Engineers are

registered with a docket numbers, which are intimated to the

consumers. Thereafter, the complaints are transferred to respective

clxxxii

service stations/ O&M section office for resolving the same. The

concerned O&M/ Local service station/O&M staff inspect the

consumers’ premises at the earliest to attend the complaints and then

compliance regarding the same is reported to Centralized Call Centre.

Afterwards, the same is informed to the respective consumers to

confirm that the complaint has been attended.

Further, daily reports indicating the number of complaints received,

complaints attended, complaints pending and reasons for not

attending to complaints are being generated in the Centralized

Customer Call Centre.

Statement showing the details of calls received, answered /

complaints registered and attended in the Centralized Customer Call

Centre, from August to 10th November, 2015, is furnished as below:

SI.

No. Month

No. of calls

received and

answered

No. of complaints

registered and

attended

Remarks

1 August 15 22557 2124

2 September15 23817 2376

3 October 15 15958 1637

4 01.11.2015 to 10.11.2015 2981 411

Total 65313 6548

Statement showing the details of Consumer Interaction Meetings held

in the O&M sub- division:

SI

N

o

Name of

division

No. of

sub-

division

s

No. of consumer

interaction meetings

held in O&M sub-

divisions from April to

November-15

No. of consumers participated in

every meeting.

1 Gulbarga

CSC 2 2 - in each sub-division 25-30 members in each meeting

2 Gulbarga D-

I 4 6 - in each sub-division

125-130 members in each

meeting

3 Gulbarga D-

II 5 3 - in each sub-division 40-50 members in each meeting

clxxxiii

4 Sedam 2 8 - in each sub-division 40-45 members in each meeting

5 Yadgir 5 3 - in each sub-division 80-90 members in each meeting

6 Bidar 4 3 - in each sub-division 110-120 members in each

meeting

7 Humnabad 3 3 - in each sub-division 140-150 members in each

meeting

8 Raichur

Urban 2 2 - in each sub-division 25-30 members in each meeting

9 Raichur

Rural 4 2 - in each sub-division 25-30 members in each meeting

10 Sindhanur 3 2 - in each sub-division 30-35 members in each meeting

11 Koppal 3 2 - in each sub-division 20-25 members in each meeting

12 Gangavathi 3 2 - in each sub-division 15-20 members in each meeting

13 Hospet


14 Hospet Rural 4 2 - in each sub-division 15-20 members in each meeting

15 Bellary


16 Bellary Rural 3 3 - in each sub-division 7-10 members in every meeting

Progress of establishing the service stations in the subdivisions/sections :

Total No.

of sub-

divisions

Total

service

stations

established

in sub-

divisions

Total No.

of

sections

Total

service

stations

established

in sections

Balance

service

stations

required to

be

established

Likely time

for

establishing

the

balance

service

stations

53 53 245 245 0 -


clxxxiv

The Commission notes that the GESCOM has taken certain measures

for effective redressal of consumer complaints. The GESCOM is

directed to continue to focus on improving the consumer services and

further reduce the consumer complaint downtime to ensure prompt

services to them. The GESCOM should ensure prompt response to

consumer complaints about interruptions in power supply due to

breakdown of lines/equipment, replacement of faulty transformers etc.

The GESCOM should sensitize its field staff in this regard.

The GESCOM shall continue to ensure that the higher officers are

present in the consumer interaction meetings at the subdivisions to

effectively redress the grievances of the consumers.

The Commission reiterates its directive to the GESCOM to publish the

complaint handling procedures / contact number of the Centralized

Consumer Service Centre regularly in the local media and other

modes periodically for the information of public and ensure that all the

complaints of consumers are registered only through the centralized

consumer service centre for proper monitoring of disposal of

complaints registered.

The compliance in the matter shall be submitted to the Commission

once in a quarter regularly.

vi) Directive on Energy Audit:

The Commission had directed all the GESCOM to prepare a

metering plan for energy audit to measure the energy received

in each of the interface points and to account for the energy

sales. The Commission had also directed the GESCOM to

conduct energy audit and chalk out an Action Plan to reduce

distribution losses to a maximum of 15 per cent wherever it was

above this level in towns/ cities having a population of over

50,000.

clxxxv

The Commission had earlier directed the ESCOMs to complete

installation of meters at the DTCs by 31st December, 2010. In this

regard, the ESCOMs were required to furnish to the Commission the

following information on a monthly basis:

a) Number of DTCs existing in the Company.

b) Number of DTCs already metered.

c) Number of DTCs yet to be metered.

d) Time bound monthly programme for completion of work.

Compliance by GESCOM:

Progress of energy audit of town / cities is given below:

Sl.

No.

Name of the town /

city

Average percentage distribution losses recorded

FY14 FY15 FY 16 (up to Sept

2015)

1 Gulbarga 18.1 14.1 12.1

2 Shahabad 29.8 27.3 25.6

3 Yadgir 28.9 23.5 20.1

4 Bidar 16.7 18.1 15.6

5 Basavakalyan 14.8 17.3 14.3

6 Raichur 24.5 21.2 18.3

7 Sindhnoor 20.2 20.5 18.8

8 Koppal 16.3 16.6 13.5

9 Gangavathi 18.9 18.8 15.6

10 Hospet 16.8 18.5 15.8

11 Ballari 19.5 16.2 12.2

GESCOM 20.4 19.3 16.5

Sl.

No. Year Towns / cities with percentage distribution losses

clxxxvi

< 10% 10 - 15% 15 - 20% 20 - 25% >25%

1 FY14 0 1 7 1 2

2 FY 15 0 1 7 2 1

3 FY16 (up to Sept

2015) 0 4 6 1 0

Trajectory Loss Level

33kV Line losses

Sl

No

.

Month

and

Year

Name of the 33

kV Line

Length

of the

feeder

in Km

Conductor

used

Sending end

energy at

110 kV MUSS

in KWh

Receiving

end energy

in KWh

33 kV

line loss

in KWh

% Loss

1

Oct15

Hanumsagar 12 Coyote 41,600 41,000 600 1.44

2 Khajuri 16 Coyote 12,90,420 12,76,500 13,920 2.8

3

Jidaga +

Madanhipparg

a

39 Coyote 14,10,900 13,79,900 31,000 3.20

4 Jalahalli 29 Coyote 19,57,200 19,37,824 19,376 0.99

5 Nagalpur 15 Coyote 15,82,200 15,64,796 17,404 1.1

6 Yappaldinni 44.5 Coyote 42,40,000 41,84,880 55,120 1.3

Average 33 kV Line Loss

1.81

33/11 kV Power Transformer losses

Sl

No

Month and

Year

Name of the 33 kV

sub-station

Transformer

capacity

Power Transformer

sending end

energy in KWh

(HV)

Power Transformer

receiving end

energy in KWh

(LV)

33 kV

Transform

er Loss

%

Transformer

Loss

1

Oct15

Gobbur 2X5 MVA 9,49,400 9,24,900 24,500 2.6

2 Yappaldinni 1X5 MVA 13,81,010 13,67,890 13,120 0.95

3 Chandrabanda 1X5 MVA 8,20,334 8,13,115 7,219 0.88

clxxxvii

4 Talkal 2X5 MVA 5,54,100 5,43,700 10,400 1.88

5 Chalagera 2X5 MVA 4,14,000 4,08,500 5,500 1.33

Average 33 kV Power Transformer Loss 1.53

Abstract of 11 kV feeder-wise dist. losses (including 11 kV transformers, LT line

and commercial losses) for the month of June 2015

SI.

No

Name of the

division

Urban /

rural

No. of

feeders

Feeder

consumption

(MU)

Metered

sales as

per DCB

(MU)

Un-

metered

sales

(MU)

Total

sales

(MU)

Loss

in %

1 Bidar

Urban 27 17.8

17.38 29.7 47.08 8.48 Rural 99 33.64

Total 126 51.44

2 Humnabad

Urban 20 7.5

11.61 15.74 27.35 20.89 Rural 82 27.07

Total 102 34.57

3 Gulbarga-I

Urban 18 5.72

11.3 18.33 29.63 11.42 Rural 119 27.73

Total 137 33.45

4 Gulbarga-CSC Total 42 28.12 24.05 0.36 24.41 13.19

5 Gulbarga-II

Urban 28 5.25

8.89 8.35 17.24 23.04 Rural 45 17.15

Total 73 22.4

6 Sedam

Urban 10 3.87

6.74 6.79 13.53 20.60 Rural 48 13.17

Total 58 17.04

7 Yadgir

Urban 20 6.86

12.7 15.17 27.87 18.77 Rural 90 27.45

Total 110 34.31

8 Raichur

Urban 26 17.39

16.26 24.22 40.48 20.11 Rural 108 33.28

Total 134 50.67

9 Sindhanur Urban 16 6.39

14.94 10.58 25.52 24.72 Rural 79 27.51

clxxxviii

Total 95 33.9

10 Raichur-CSC Total 20 18.37 13.92 0.74 14.66 20.20

11 Koppal

Urban 19 10.31

10.183 30.17 40.353 19.44 Rural 88 39.78

Total 107 50.09

12 Gangavathi

Urban 20 14.55

16.99 14.22 31.21 24.61 Rural 84 26.85

Total 104 41.4

13 Hospet

Urban 29 13.44

16.01 35.08 51.09 21.06 Rural 169 51.28

Total 198 64.72

14 Hospet-CSC Total 13 11.21 8.51 0.17 8.68 22.57

15 Bellary Rural

Urban 38 23.36

22.89 15.56 38.45 17.75 Rural 86 23.39

Total 124 46.75

16 Bellary CSC Total 23 21.238 17.78 0 17.78 16.28

Average 11 kV losses 18.95

11 kV line losses excluding 11 KV transformer, LT line and commercial loss =

(18.95-3.30-7.13) = 8.52%

Calculation of LT line loss

SI.N

o

Name of

DTC

Name of

the village

DTC

capacit

y (kVA)

Initial

energy

(kWh)

Final

energy

(kWh)

CT

Ratio MF

DTC

energy

consump

tion

(kWh)

Consu

mers’

consu

mption

(kWh)

Loss on

the DTC

(kWh)

Loss in %

1 Sivakrupa

Pulses

Nandoor/K

esertege

Industrail

Area

100 3543.4 3612.4 150/5 30 2069.909 1926.9 143.01 6.9

2

Laxmi

Nagar

Temple TC

Kalnoor 100 4256.4 4334 150/5 30 2327.16 2184 143.16 6.15

3

High

School

private TC

Suntanoor 25 6273.3 6468.9 50/5 10 1955.42 1924 31.42 1.6

clxxxix

4

Behind

Nilambika

Dal DTC

Nandoor/K

apnoor

Industrial

Area

100 1925.2 1988.9 150/5 30 1909.86 1718.6 191.21 10.01

5

Mahagaon

Cross

Police

Station Tc

mahagaon 63 459.84 474.69 100/5 20 297.04 278 19.04 6.4

6 Hyder patil

Gadiyar TC Bhimalli 100 3952.9 4047.1 150/5 30 2825.61 2600 225.61 7.98

7

Pirppa

poojari

village IP

set Tc

Sharedown

Village 63 9181.1 9350.7 100/5 20 3390.6 3024 366.6 10.81

8

Near

Hanuman

Temple TC

Kamalapur 100 8392.5 8561.2 150/5 30 5059.83 4992 67.83 1.34

9

Mahagaon

Cross

Babaset Tc

Mahagaon 25 1912.2 2020.1 50/5 10 1079.79 960 119.79 11.09

10

harsoor

Thanda

W/s TC

Harsoor

Thanda 25 1173.8 1329.5 50/5 10 1556.66 1417 139.66 8.97

Average LT Line loss 7.13

Abstract

1 33 kV line losses 1.81 %

2 33 kV transformer losses 1.53 %

3 11 kV line losses 8.52 %

4 11/0.433 kV DTC losses (assumed) 3.30 %

5 LT line losses 7.13 %

Progress of DTC metering Sl.

No

Particulars Progress as on

30.09.2015

1 Number of DTCs existing in the company. 75,015

2 Number of DTCs already metered. 55,886

3 Number of DTCs yet to be metered. 19,129

4 Time bound monthly programme for

completion.

March, 2016

cxc

Tagging details of DTCs as on October 2015:

Sl

No. Name of division

Total No. of

DTCs

existing

Total DTC

metered

No. of

DTCs

indexed/

Tagged

Balance

DTCs to

be

indexed/

Tagged

No. of DTCs for

which energy

audit is done

(out of shown in

Sl. No.4)

1 2 3 4 5 6 7

1 Bidar 7398 5430 2547 4851 167

2 Humnabad 4337 2621 1381 2956 134

3 Gulbarga I 6445 5885 4435 2010 855

4 Gubarga II 4153 2726 2368 1785 476

5 Sedam 2688 971 468 2220 124

6 Yadgir 6692 6493 2580 4112 264

7 Bellary 6901 4255 4206 2695 955

8 Hospet 10427 6026 5147 5280 1107

9 Koppal 5206 5092 2120 3086 114

10 Gangavathi 4734 3481 2355 2379 323

11 Raichur 6567 5146 2741 3826 396

12 Sindhanur 4171 2772 2431 1740 85

13 Gulbarga Csc 2707 2436 0 2707 0

14 Raichur CSC 918 879 0 918 30

15 Bellary CSC 1184 1022 960 224 167

16 Hopset CSC 718 651 594 124 16

Total 75,246 55,886 34,333 40,913 5,213

The Statement showing the energy audit details for the month of June

2015

cxci

Sl No Division 0 -10% 10-20% 20 – 30% >30% -ve loss Total

1 Bidar 8 9 9 102 39 167

2 Humnabad 7 2 4 47 74 134

3 Gulbarga 1 35 35 34 193 558 855

4 Gulbarga 2 59 97 94 157 69 476

5 Sedam 11 33 21 30 29 124

6 Yadgir 25 69 76 59 35 264

7 Bellary 225 176 140 347 67 955

8 Hospet Rural 43 647 138 81 198 1107

9 Koppal 20 27 11 35 21 114

10 Gangavathi 57 41 36 143 46 323

11 Raichur Rural 17 13 17 140 209 396

12 Sindhanur 7 15 9 43 11 85

13 Gulbarga

CSC 0 0 0 0 0 0

14 Bellary CSC 67 80 20 0 0 167

15 Raichur CSC 30 0 0 0 0 30

16 Hospet CSC 10 6 0 0 0 16

Total 621 1,250 609 1,377 1,356 5,213

The GESCOM has submitted the energy audit of towns and cities up to

September, 2015, to the Commission and energy audit for October

and November 2015 is under preparation and will be submitted shortly.

The feeders wise and DTC wise energy losses are identified and the

following steps are taken to reduce the energy loss below 15 per cent.

1. Straightening of 2,800 slanted poles at a cost of Rs.22.40 lakh.

2. Sealing of meters is taken up and 1,22,500 meters have been

sealed up to November, 2015.

cxcii

3. The vigilance wing has carried out the intensive checks of

installations and 8,972 theft cases have been booked and Rs.1,498

lakh penalty is imposed.

4. Efforts are being made to issue 100 per cent bills to the consumers.

5. Reconductoring of 155 km of HT and 933 km of LT line has been

carried out.

6. Bifurcation of 11 kV feeders by providing new 11 kV link lines.

7. Providing additional distribution transformers.

8. Replacement of HT/LT line conductors.

9. Carrying out the regular maintains on distribution system.

10. Balancing of the load on DTCs.


The Commission notes that the GESCOM has not submitted regularly

the monthly analysis of energy audit conducted in respect of cities /

towns. As seen from the consolidated energy audit statement for the

FY15, 10 of the 11 towns have AT&C losses more than the mandated 15

per cent. Similarly, the energy audit for the FY16 up to the

September15 reveals that 7 towns have AT&C losses more than 15 per

cent with the Shahabad town topping the list with the highest losses at

27 per cent. This calls for taking urgent steps on the part of the

GESCOM to initiate remedial measures to bring down the losses well

below the targeted levels of 15 per cent. The GESCOM is directed to

initiate suitable measures to bring down the loss levels and compliance

regarding the energy audit conducted in respect of cities/towns and

the specific remedial measures taken to reduce losses shall be

submitted to the Commission every month regularly.

The Commission further notes that the metering is completed for 75 per

cent of the DTCs. But, in spite of completing the meters to the DTCs,

the GESCOM has taken up energy audit of only 5,213 DTCs reportedly

due to incompletion of tagging of consumer installations with the

cxciii

respective feeders/DTCs. Further, the analysis of DTC wise energy audit

reveals that out of 5,213 DTCs taken up for energy audit, more than 15

per cent losses are recorded in 4,592 DTCs, remedial measures needs

to be initiated to reduce losses in these DTCs. Further, it is observed that

there has been an inordinate delay in tagging of consumer details

with the feeders/DTCs by the GESCOM. In fact the GESCOM during the

ESCOMs’ Review meetings held in the Commission had committed to

complete this exercise before August 2014, but the progress achieved

is not satisfactory as it is yet to complete 100 per cent tagging.

The GESCOM is directed to take up energy audit of DTCs for which

meters have already been installed and to initiate corrective measures

for reducing distribution losses wherever they are above the standard

level. The compliance in respect of DTC wise energy audit conducted

with analysis and the remedial action initiated to reduce loss levels

shall be submitted every month regularly to the Commission.

Further, the GESCOM is directed to submit to the Commission the

consolidated energy audit report for the FY16, as per the formats

prescribed by the Commission vide its letter No: KERC/D/137/14/91

dated 20.04.2015, before 15th May 2016.

vii) Directive on Implementation of HVDS:

In view of the obvious benefits in the introduction of HVDS in

reducing distribution losses, the Commission had directed the

GESCOM to implement High Voltage Distribution System in at

least one O&M division in a rural area in its jurisdiction by utilizing

the capex provision allowed in the ARR for the year.


The GESCOM is herewith submitting the details of implementation of

HVDS in TurvihalHobli in Sindhanoor Taluka at a cost of Rs. 11.89 crore

cxciv

and requests the Commission to approve the same for

implementation.

SI.

No District

Name of the

sub-division

selected for

pilot implementatio

nnnnnn

No. of

feeder

s

select

ed

Present status of project

Estimate

cost (Rs.

In crore)

1 Bellary Kudligi 36 One Hobli viz. Turvihal in

Sindhanoor Taluka is taken

up for implementation of a

pilot project. The DPR has

been prepared and the

total cost of project is Rs.

11.89 crore. Tender not yet

floated because of

Agavani Committee

report that HVDS scheme

is not viable. Hence, the

scheme is not taken up.

134.58

2 Raichur

Sindhanoor

Turvihal

(Hobli)

45

282.57

Lingasugur 37

11.89

Total 429.04


The Commission has been directing the ESCOMs to identify one sub-

division in each ESCOM with high LT/HT ratio and high distribution loss

levels, so that substantial loss reduction could be achieved by

implementing the HVDS in such subdivisions. Further, with a view to

bring down the cost of implementation of HVDS, the Commission has

also issued revised guidelines to all the ESCOMs to implement HVDS in

subdivisions/feeders having the highest distribution losses. However, the

GESCOM has not taken up implementation of the same in its

jurisdiction despite these directions.

In the previous Tariff Order, the GESCOM was also directed to submit

the DPR in respect of Turuvihal Hobli in Sindanur Taluk for approval of

the Commission. The GESCOM is yet to submit the same.

Further, in the ESCOMs’ Review meeting held in the Commission, the

GESCOM was also directed to submit a detailed report on the viability

cxcv

of implementation of HVDS scheme, for taking a view in the matter by

the Commission. However, the GESCOM so far has not submitted its

report in this regard.

Hence, the GESCOM is directed to follow the revised guidelines issued

by the Commission and to take up implementation of HVDS

programme in Turuvihal Hobli in Sindanur Taluk and submit

compliance of the same from time to time to the Commission.

viii) Directive on Niranthara Jyothi – Feeder Separation:

The ESCOMs were directed to furnish to the Commission the

programme of implementing 11 KV taluk wise feeders’ segregation

with the following details:

a) Number of 11 KV feeders considered for segregation.

b) Month wise time schedule for completion of envisaged work.

c) Improvement achieved in supply after segregation of

feeders.


The main objective of NJY is bifurcation of feeders into IP set and

village loads with separate 11kV feeders for arranging 24 hours of

power supply to village loads and restricted hours of power supply to IP

sets. Due to non-bifurcation of IP set loads from NJY feeders, 32

feeders are not commissioned and the same will be commissioned

after completion of load bifurcation work. The probable date of

completion of NJY Phase-I & II is March, 2016.

Progress of Niranthara Jyothi Work

Phase No. of

Taluks

Villages

covere

d

11 kV

NJY

feeders

propos

ed

DPR

cost in

Rs. Crs.

Feeders

commiss

ioned

feeders

completed

Work in

progress

Work to

be taken

up

Probabl

e date

of

complet

ion

Phase-I 20 2,765 235 287 155 22 58 0 March

cxcvi

Phase-

II 10 1,087 109 154 68 10 28 3

2016

Total 30 3,852 344 441 223 32 86 3

Analysis of 130 feeders commissioned under NJY scheme is given

below: (Analysis of remaining feeders will be submitted later).

Analysis of commissioned NJY feeders

Sl.

No Parameters Before

After % age

reduction NJY Residual IP

feeders

1 Reduction in peak load Amps 148 52 114 65

2 Reduction in failure of transformers 4 1 1 75

3 Reduction in input energy in MU 0.50 0.26 0.33 48

4 Increase in metered energy sales in

MU 0.1 0.14 0 55

5 Decreases in No. of interruptions 49 23 30 53

6 Improvement in tailed voltage 356 407 381 14


The Commission notes that the GESCOM is yet to commission all the

feeders, both under NJY phase1 & 2 for which the segregation work

has been completed in all respects. The progress achieved in

implementing the works both under NJY phase1&2 is not satisfactory as

the same has been delayed inordinately. The delay in implementation

of NJY works, in fact has resulted in non-realization of envisaged

benefits set out in the DPR when the project was initiated.

The Commission directs the GESCOM to expedite commissioning of

balance feeders and to carry out the performance analysis of such

feeders to ensure that the objectives set out as per DPR are

accomplished.

cxcvii

Further, the Commission has noted that the GESCOM has carried out

the performance analysis of feeders commissioned under NJY

indicating the benefits accrued to the system in terms of reduction in

failures of distribution transformers, improvement in tail-end voltage

and improvement in supply/reduction in interruptions and increase in

metered consumption. The GESCOM is directed to conduct

comprehensive analysis of the feeders once the NJY works are

completed in all respects and the details of the same shall also be

submitted to the Commission.

The GESCOM is directed to expedite execution of NJY works under

both phase1&2 and report compliance thereon to the Commission.

Further, the GESCOM shall ensure that NJY feeders are not tapped

illegally for running IP sets which would defeat the very purpose of

feeder separation scheme undertaken at huge cost.

Further, it is noted that the GESCOM has already segregated 223

feeders under phase1&2 works and consequently agricultural feeders

are exclusive from rural loads and the energy consumed by the IP sets

could be more accurately measured at the 11 KV feeder level at the

sub-stations after duly allowing for distribution losses in 11 KV lines,

distribution transformers and LT lines. The GESCOM is directed to report

every month, the total IP sets consumption only on the basis of data

from agricultural feeder energy meters and furnish the specific

consumption of IP sets as per the formats prescribed by the

Commission, vide its letter No: KERC/D/137/14/91 dated 20.04.2015,

before 15th May 2016.

The GESCOM is also directed to continue to furnish feeder wise IP set

consumption based on energy meter data in respect of agricultural

feeders segregated under NJY to the Commission every month.

ix) Directive on Demand Side Management in Agriculture:

cxcviii

In view of the urgent need for conserving energy for the benefit

of the consumers in the State, the Commission had directed the

GESCOM to take up replacement of inefficient pumps with

energy efficient pumps approved by the Bureau of Energy

Efficiency, at least in one sub-division in its jurisdiction and report

compliance thereon to the Commission.


DSM cell is created in the GESCOM during the month of September,

2015 and the DSM program in agriculture for replacing the inefficient

irrigation pump sets by efficient irrigation pump sets is not yet started

and the same will be started shortly. In GESCOM, Afzalpur Taluka has

been selected for implementation of a pilot project to replace 100 IP

sets.

Further, load survey of agricultural sector has been conducted by M/s

EESL under Bureau of Energy Efficiency’s “Capacity Building

programme for DISCOMS” under GESCOM’s preview.

The following Pie diagram shows the percentage of agriculture

consumers with the type of water source.

Observations made during the Load Survey:

The motors were not metered (This makes the project implementation

difficult as we cannot establish a base line for calculating the energy

savings).

The consumers (farmers) were not ready to give the correct details of

the installed capacity of the motors.

cxcix

Technical difficulties faced are that though motors were of three

phases, they were running on the single phase supply.

Feeder segregation should be done for the Agriculture sector.

Projects to be implemented in the deemed savings mode.

In order to successfully implement the projects, the agricultural

consumers should enter into agreements with the ESCOM.


The Commission observes that there is no progress in

implementation of DSM measures by the GESCOM; in fact the

status is same as that of the previous year only. It is also noted

that the GESCOM has not taken any action to take forward the

implementation of DSM measures in its jurisdiction seriously

beyond load survey of agricultural loads. The GESCOM is

directed to initiate further necessary action required for

implementation of DSM measures.

Further, the Commission is of the opinion that there is a huge

potential for energy saving in the agricultural sector which

needs to be tapped and therefore, much emphasis should be

given for implementation of DSM measures to conserve energy

and also precious water for the benefit of farmers. It is also

noted that several consumers participating in the Public Hearing

held on 4.3.2016 at Kalaburagi expressed that they are not

aware of details and also benefits of the Agriculture DSM.

Therefore, the GESCOM is directed to take up awareness

programme regularly so as to encourage the farmers to adopt

energy saving measures in their activities.

The Commission during its review meetings with the ESCOMs held

in the Commission has been directing them to initiate DSM

measures in any one sub-division/taluk in order to assess the

results of such measures before scaling up in its entire jurisdiction.

cc

The GESCOM is directed to expedite the implementation of DSM

measures in Afjhalpura taluk as reported by it and compliance

thereon shall be submitted to the Commission within three

months from the date of this order.

x) Directive on Lifeline Supply to Un-Electrified households:

The Commission has directed the ESCOMs to prepare a detailed and

time bound action plan to provide electricity to all the un-electrified

villages, Hamlets and Habitations in every taluk and to every household

therein. The action plan shall spell out the details of additional

requirement of power, infrastructure and manpower along with the

shortest possible time frame (not exceeding three years) for achieving

the target in every taluk and district. The Commission has directed that

the data of un-electrified households could be obtained from the

concerned gram panchayaths and the action plan be prepared

based on the data of un-electrified households.


The GESCOM has identified 88,787 BPL households, 14,743 BPL

households in SC category and 8,846 BPL households in ST category.

Tenders have been floated for Kalaburagi district for electrification of

2,658 households at a cost of Rs. 12.23 crore and the work is already

awarded. The electrification of BPL households is targeted to complete

by June 2016. The electrification of remaining of BPL households is

included in DDUGJY scheme. The project report is prepared and

tendering is in process.

The RGGVY scheme envisaged providing access to all rural households

by the end of 12th five year plan and the scheme covers all left over

rural houses including BPL. Following are the details :

Sl.

No

Name of the

district

No. of BPL

households

already

electrified

No. of rural

households

already

electrified

Total BPL covered

under the XII plan

scheme

Rural

households

covered under

the XII plan

scheme

1 Bidar 22,948 31,466 5,965 34,810

2 Raichur 28,335 34,514 25,387 34,583

cci

3 Koppal 26,946 32,506 7,995 32,027

4 Ballari 43,300 40,857 7,152 29,106

5 Kalaburagi 35,135 48,752 26,518 45,665

6 Yadgir 23,838 32,501 15,780 39,564

Total 1,80,502 2,20,597 88,797 2,15,755

After completion of scheme under 12th Plan, all the rural household

including BPL households would be electrified in the GESCOM.


The Commission notes that still a vast number of households in

the remote areas of GESCOM’s jurisdiction remain un-electrified.

The GESCOM needs to expedite electrification of these

households with the seriousness this matter deserves. The

programme should be implemented within in a time bound

period to ensure that the people who are provided with the

basic need of electricity. The Commission, while reviewing the

status of compliance of its directives during the ESCOMs’ Review

meetings, has been stressing upon the ESCOMs to initiate

necessary action to provide electricity to all the un-electrified

households with funding arrangement by RGGVY or any other

source.

The GESCOM shall come out with an action plan to implement

the directive of the Commission for providing electricity to the un-

electrified households in its jurisdiction and submit

compliance/progress thereon monthly to the Commission.

Further, the Commission, concerned with the slow pace of progress of

this programme, in its previous Tariff Order had directed the GESCOM

to cover electrification of 5 per cent of the total identified un-

electrified households every month beginning from April 2015 onwards

ccii

so as to complete this programme in about twenty months. However,

there is not much progress in these aspects. The GESCOM is directed to

expedite action to provide electricity to the un-electrified households

covering all the remaining households within the targeted time and

report compliance to the Commission regarding the monthly progress

achieved from May, 2016 onwards. In the event of non-compliance,

the Commission may be constrained to initiate penalty proceedings

under section 142 of the Electricity Act, 2003.

xi) Directive on sub-division as Strategic Business Units (SBU):

The present organizational set up of the ESCOMs at the field

level appears to be mainly oriented to maintenance of power

supply without a corresponding emphasis on realization of

revenue. This has resulted in a serious mismatch between the

power supplied, expenditure incurred and the revenue realized

in many cases. The continued viability of the ESCOMs urgently

calls for a change of approach in this regard, so that the field

level functionaries are made accountable for ensuring

realization of revenues corresponding to the energy supplied in

their jurisdiction.

The Commission has directed the GESCOM to introduce the

system of Cost-Revenue Centre Oriented sub-divisions at least in

two divisions in its operational area and report results of the

experiment to the Commission.


Earlier, due to shortage of staff, the GESCOM was unable to implement

SBU in subdivisions. Now, about 170 Assistant Engineers have been

recruited, the GESCOM has introduced Strategic Business Units in

eleven sub-divisions as noted below.

1. Bidar

2. Bhalki

3. B.Kalyan

cciii

4. Humnabad

5. Gulbarga City-1

6. Gulbarga City-2

7. Bellary

8. Raichur

9. Gangavathi

10. Sindhanur

11. Koppal.

Further, the GESCOM will also introduce SBUs in other subdivisions and

the details of the same will be prepared and submitted to the

Commission.


The Commission notes that, the ESCOMs have expressed their

difficulty in introduction of SBU concept in their O & M divisions /

sub divisions due to implementation issues in the field. The

Commission recognizes the problems associated with

implementation of SBU concept. As an alterantive, the

Commission had instituted a study to make field formations of the

ESCOMs financially accountable without any modification in

their existing administrative set up. The Commission has

forwarded a report prepared by the consultants M/s PWC

regarding implementation on Financial Management Framework

for distribution utilities to take further action to implement a

model suggested by the consultant, in their jurisdiction to bring in

accountability on the performance of the divisions / sub-divisions

in relation to the quantum of energy received, sold and its cost

so that they conduct their business on commercial principles.

The GESCOM is therefore, directed to implement this financial

management framework model and report compliance thereon

within three months from the date of issue of this Order.

xii) Directive on Prevention of Electrical Accidents:

cciv

The directive was as follows:

“The Commission has reviewed the electrical accidents that have

taken place in the State during the year 2014-15 and with regret noted

that as many as 564 people and 514 animals have died due to these

accidents.

From the analysis, it is seen that the major causes of these accidents

are due to snapping of LT/HT lines, accidental contact with live

LT/HT/EHT lines, hanging live wires around the electric poles

/transformers etc., in the Streets posing great danger to human lives.

Having considered the above matter, the Commission hereby directs

to prepare an action plan to effect improvements in the Transmission

and Distribution Networks and implement safety measures to prevent

electrical accidents. Detailed division wise action plans shall be

submitted by the GESCOM to the Commission.”

Compliance by GESCOM:

It is submitted that, a total budget of Rs 500 Lakh has been allotted to take

up the following remedial measures under action plan by identifying and

rectifying the hazardous installations to reduce electrical accidents

i. To carry out periodical and preventive maintenance works on

distribution system.

ii. 9,059 slanted poles have been set right.

iii. Providing intermediate poles on LT/ HT lines.

iv. Replacement of deteriorated conductors / broken poles in LT/HT lines.

v. Re-stringing of loose spans in HT/LT lines.

vi. To attend loose span in LT lines, 8,000 spacers are provided.

vii. Fencing to 1,700 distribution transformers centers provided along

with proper earthing at a cost of Rs. 2.15 crore

viii. To avoid accidents 73.53 km of AB cables are provided where LT

lines are passing in close proximity to the buildings in towns.

ix. Balancing of loads in 1,500 distribution transformers completed.

x. Foot concreting of 2,800 poles at a cost of Rs 35.00 lakh.

xi. Rectification of hazardous installations identified in lines and

equipment.

xii. Procurement of safety materials for field staff.

xiii. Training has been imparted to Group “C” and “D” employees

through Rural Electrification Corporation on franchisee selection, safety

measures etc., under RGGVY scheme.

ccv

The details of electrical accidents occurred during FY14 and FY15:

Particulars

No. of accidents

during FY 2013-

2014

No. of

accidents

during FY

2014-15

Increase/

Decrease

Fatal

Departmental 9 3 Decrease

Non-departmental 93 95 Increase

Animal 182 198 Increase

Non-Fatal

Departmental 14 39 Increase

Non-departmental 44 64 Increase

The details of division wise hazardous installations identified/rectified to

prevent electrical accidents:

Sl.

No Division

No. of hazardous

installations (both HT&

LT)identified

Estimated

cost in Rs.

Lakhs

No. of

hazardous

installations

rectified

Balance

hazardous

installations to

be rectified

1 Gulbarga CSC 10 0.43 7 3

2 Gulbarga Div-1 55 1.83 45 10

3 Gulbarga Div-2 45 1.61 42 3

4 Sedam 35 1.32 35 0

5 Yadgir 45 1.70 35 10

6 Bidar 60 2.08 52 8

7 Humnabad 55 1.89 35 20

8 Koppal 35 1.40 30 5

9 Gangavathi 16 0.80 9 7

10 CSC Raichur 8 0.35 8 0

11 Raichur Rural 135 4.05 100 35

12 Sindhnoor 75 2.50 48 27

13 CSC Hospet 15 0.45 15 0

14 Hospet Rual 60 0.60 50 10

15 CSC Ballari 12 0.27 9 3

16 Ballari Rural 49 1.55 38 11

Total 710 22.81 558 152

ccvi


The Commission observes that despite the GESCOM taking various

remedial measures including rectification of hazardous installations in

its network, the number of fatal electrical accidents involving both

human and livestock has only increased which is of a serious concern.

This indicates that identification and rectification of all hazardous

installations is not completed. The GESCOM should make more

concerted efforts for identification and rectification of all the

hazardous installations prevailing in the distribution system particularly

in densely populated areas & public places. The GESCOM also needs

to take up with the concerned local bodies rectification of the

hazardous streetlight installations and other electrical works under their

control to ensure safety of the public. It is also necessary that the

GESCOM creates awareness through visual/print media continuously

about safety aspects among public to ensure that the attention on

safety aspects is maintained.

The Commission, during the Review meetings held with the ESCOMs

has been prompting the ESCOMs to take up periodical preventive

maintenance works, install LT protection to distribution transformers,

conduct regular awareness program for public on electrical safety

aspects in use of electricity and also ensure use of safety tools and

tackles by their field staff besides imparting necessary training to the

field staff at regular intervals. The GESCOM shall take effective steps to

achieve these.

Further, the GESCOM shall adhere to the best construction practices as

per the standards on construction/expansion of the distribution

network so that no maintenance is required for such network for a

reasonably long period of time. The GESCOM shall also conduct safety

ccvii

audit and carryout preventive maintenance works as per the schedule

to keep the network equipment in healthy condition.

The Commission has already forwarded the Safety Technical Manual

prepared by a sub-Committee comprising of experts from the Advisory

Committee, constituted by the Commission which should serve as a

useful guide for the field engineers to record all the technical

deficiencies prevalent in the distribution network and also enable them

to take remedial action on the basis of the audit. In the Safety

Technical Manual, a detailed account of the steps to be taken on

each element of the distribution system is enumerated which would

help the field engineer in attending to the defects. The ESCOMs are

required to circulate the Safety Technical Manual among their field

staff for necessary guidance and also to continuously monitor the

implementation of the suggestions/ recommendations contained in

the reports.

The Commission therefore, reiterates its directive that the

GESCOM shall continue to take necessary measures to identify

and rectify all the hazardous locations/installations prevalent in its

distribution system and to provide LT protection to distribution

transformers under an action plan to prevent and reduce the

number of fatal electrical accidents occurring in the distribution

system. The compliance regarding the same shall be submitted

to the Commission every month regularly.

ccviii

APPENDIX - 1

Statement showing the objections of the stakeholders/public, GESCOM’s

response and the Commission’s Views.

1. Objections relating to Tariff Issues:

Objections Replies by GESCOM

1. The application is not maintainable as

it is not filed 120 days before the

commencement of the next financial

year as required under the MYT

Regulations.

The Commission had extended time limit

for filing up to 15.12.2015 as per the

request from GESCOM vide Letter No.

KERC/B5/15/1469 dated 01.12.2015 and

filing has been done on 15.12.2015.

Commission's Views: GESCOM has filed its petition for truing-up for FY15 and

determination of Annual Revenue Requirement for FY17, FY18 and FY19 on 15th

December, 2015, within the time limit extended by the Commission. The Hon’ble

Appellate Tribunal for Electricity (ATE), in the case reported in 2010 ELR (APTEL) 0175

has held that “if the Licensee is unable to file ARR petition due to some reasons, it will

not be proper to say that the application has to be rejected. What could be done in

such a situation is that the carrying cost can be denied and not the revenue

recoverable for the period of delay”. In the present case, the revenue requirement

sought is from 1st April, 2016 up to 31st March, 2019, and therefore, the time taken by

GESCOM for filing the application will not adversely affect the consumers’ interest

and hence, the petition is maintainable.

2. GESCOM merely chose to file Tariff

Revision Petition without making any

efforts to realise the arrears.

The collection of arrears is taken up on

top priority and the percentage of

revenue collection against the demand

during the FY-16 up to Jan-16 is 97 %.

However for pending arrears belonging

to GoK installations, the same is being

pursued.

Commission's Views: The reply furnished by the GESCOM is acceptable. The GESCOM

shall endeavour to recover the arrears of subsidy and other receivables from the

Government to mitigate cash flow problems and to reduce the cost of borrowing to

meet the deficit. The Commission ensures that such cost does not exceed the

normative expenditure approved by it.

3. The proposed hike of 102 paise per unit

is objectionable. Tariff hike of 102 paise

per unit has been sought for all

The Gap for FY-17 is Rs.694.43 Crores

including Regulatory Asset of Rs.152.947

Crores. The increase in Tariff by 102 Paise

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categories except BJ/KJ and IP sets. per unit is requested for all the categories

including BJ/KJ and IP sets.

Commission's Views: As required under the Electricity Act, 2003, after examining all

aspects, the Commission has allowed an appropriate tariff increase, striking a

balance between the interest of the ESCOMs and the consumers.

4. All five ESCOMs have sought an

uniform increase of paise 102 per unit,

although the five ESCOMs have

separate capital structure, expenditure,

sales, loans, consumer profile, incomes,

subsidy support from the government,

operating efficiency etc. This shows that

there is a hidden horizontal agreement

between ESCOMs and allowing such

uniform hike will kill the competitive spirit

of ESCOMs.

Revision of Tariff sought is as per the

petition filed by GESCOM before KERC.

Commission’s Views: The ESCOMs are owned by the Government of Karnataka and it

is the Government’s policy to have a uniform tariff among all the ESCOMs.

5. As per the Tariff Policy, the tariff should

be within +20% of the Cost to serve.

Accordingly the tariff of HT2(a) should

be brought down by 50%.

Cost to serve will be is being

implemented shortly as per the direction

of Hon’ble KERC.

Commission's Views: As directed by the Hon’ble ATE, the Commission has

endeavored to reduce the cross subsidy gradually which is reflected in the current

order as well. The voltage wise cross subsidy levels have also been indicated in the

tariff order, as directed by the Hon’ble ATE.

6.The calculation for determining the

cross-subsidy charges as done by

GESCOM is incorrect as the Cross-

subsidy should be calculated on ARR

excluding the Demand Charges since

the Demand Charges are being

collected in the monthly bills of HT

consumers. Also, the cross-subsidy

surcharge at 66kV and 33/11kV levels

should be 80% of the difference

between the ARR and the Cost of

Cross Subsidy has to be reduced in a

phased manner. In view of increase in

the power purchase cost and growing

demand for energy, increase in number

of consumers and non-availability of

cheaper power, tariff hike of 102 paise

per unit is very essential.

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supply.

Commission's Views: The reply furnished by GESCOM is not relevant to the points

raised by the objector. The cross subsidy is being computed as per the formula

provided in the Regulations and the same is in order.

7. The deficit of 138.03 Crores for FY15

should not be considered for truing-up

and it should be removed from the

proposed deficit for FY17.

Deficit of Rs.138.03 Crores for FY15

(Rs.164.66 Crores) as per audited

financial statements, has been claimed

for true up in accordance with the

existing tariff regulation

Commission’s Views: The Commission has appropriately dealt with this issue in this

Order.

8. Revenue receipts from the sale of

power to the tune of Rs.13479.80

Crores, as submitted in its 'Notes to the

financial Statements' should be

considered as against Rs.13075.20

Crores, as proposed for the purpose of

truing-up for FY15.

Expenditure is not the main cause for

increase in the deficit year on year, but it

is the receipts. The average realization

works out to Rs.5.36 per unit as against

the approved tariff of Rs.5.48 per unit. It is

placed before the Commission, that

owing to errors apparent in the accounts,

it is not right to consider the receipts as

per final accounts of the GESCOM.

Commission’s Views: The Commission has appropriately dealt with this issue in this

Order.

9. Regulatory asset of Rs.152.94 Crores for

FY13, should not be recovered after a

gap of four years in FY17. Carrying cost

pertaining to part of amount to be

recovered from the consumers should

be allowed as against a carrying cost

on the total regulatory asset for FY13.

Regulatory asset of Rs.152.94 Crores is

claimed as per the tariff order 2015, to be

claimed in FY17 under table 5.26 Page

134.

Commission’s Views: The Commission in its Order dated 12th May, 2014, decided to

treat Rs.151.73 Crores, out of a total deficit of Rs.381.00 Crores for FY13, as Regulatory

Asset. The Commission allowed regulatory asset to be recovered from tariff during

FY16 and FY17. As per the Orders of the Hon’ble ATE in OP No.1/2011 dated

11.11.2011, the Regulatory Asset can be carried forward for a maximum of three

years. After undertaking the Annual Performance Review (APR) for FY15, based on

audited accounts, the net deficit has been carried forward to the ARR of FY17 and its

recovery has been appropriately considered.

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10. The entire cost of supply of 81.34 MU

over and above the approved

quantum supplied to IP Sets and BJ/KJ

Consumers has to be borne by the

State Government as additional

subsidy at the average cost of supply

of Rs.4.93 per unit. Thus, the additional

subsidy payable by Government of

Karnataka for FY15 is Rs.40.11 Crores.

The Commission should direct the

Government to release the additional

subsidy required by the Licensee for

sale of additional power to the

subsidised categories during the

previous control period.

It is rightly pointed out that the additional

subsidy requirement of GESCOM for FY-15

is payable by Govt. of Karnataka, this

amount can be decided on the basis of

average cost of supply after truing up

exercises for FY-15 by the Commission. If

the additional subsidy requirement is not

met by the Govt. it will pass on to all the

consumer through ARR.

Commission’s Views: The accumulation of arrears from Urban Local Bodies and Zilla

Panchayat does not affect the working results of the Company. However, timely

recovery of these arrears will result in better cash flows, enabling the Company to

discharge its current liabilities. Nevertheless, the Commission notes the concern raised

by the objectors and directs GESCOM to pursue the matter with the Government to

recover the arrears at the earliest.

11. The allowable ARR for FY17 is to the

tune of Rs.3478.45 Crores vis-à-vis the

ARR of Rs.4059.75 Crores projected by

the GESCOM.

The detailed working / explanation for

claiming the O&M expenses, working

capital, interest and finance charges has

been provided in the tariff filing and the

preliminary replies to the observations by

the Commission. Considering the

explanations / working / justification the

Commission is requested to allow the ARR

claimed in the petition, so as to earn the

available ROE.

Commission’s Views: The Commission has suitably dealt with this issue in this Order.

12. GESCOM has not indicated the steps

taken for improving efficiency.

Further, GESCOM has not indicated

the gains due to efficiency

improvement which could have been

GESCOM has taken various steps for

improving the efficiency by carrying the

various improvement in its jurisdiction. As

a result of efforts put forth by GESCOM,

over the years losses have come down,

ccxii

transferred to the consumers. from 26% in year FY-08 to 18.93 % at end

FY-15. Further it is planned to reduce the

distribution loss to 17.6 % at end of FY-17.

Commission’s Views: The Commission has suitably dealt with this issue in this Order.

13. The amount of Rs.115.47 Crores and

Rs.127.76 Crores towards interest on

delayed payment during FY15 and

FY17 respectively should be

disallowed in accordance with Tariff

Regulations, 2006.

In view of huge amount of interest to be

paid to KPCL, GESCOM has made the

proposal of interest on belated payment

to IPPs, for FY15.

Commission’s Views: The Commission is not allowing any interest on the delayed

payment towards power purchases in the ARR.

14. The average power purchase prices

from various sources projected for

FY17 does not correspond to the

recent decreasing trends in fuel

prices. Linear increase in the power

purchase cost has been considered

without accounting for the distinct

nature of fixed and variable charges.

GESCOM has erred in considering the

capacity charges from CGS plants

based on the tariff petitions filed by

them before the CERC for the control

period 2014-19.

Thermal source of power purchase

constitutes 52% of the total purchase and

the remaining is from other sources.

Hence, the average power purchase

cost is not only dependent on the price

of the coal but varies on the source wise

energy mix purchased. Further, analysis of

power purchase cost from different

sources shows that there is a consistent

increase in cost from all sources except

hydel. Increase in capacity charges is

due to commissioning of new power

projects, which are in pipe line such as,

BTPS-unit-3, Yermarus 1 and 2, Damodar

Valley Corporation and other projects.

Commission’s Views: The Commission has indicated its approach in validating the

power purchase quantum and costs, in this Tariff Order.

15. An average increase in the range of

13.47% to 18.18% has been

considered for KPCL and CGS stations

over the values of FY15 for projecting

for FY17. Prudence check should be

done on projected power purchase

cost for FY17.

Increase in power purchase cost is

attributed to annual increase of 7% to 8%

inflation rate and increase in interest rate.

Besides, Royalty charges, secondary

energy charges, incentives are

considered for the projection. The

projected power purchase cost works out

to 3.10% increase for two years resulting

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annual growth rate of 1.55%.

Commission’s Views: The payment for power purchase is based on the Regulations

issued by the CERC and also by the Commission. They are based on norms stipulated

under those Regulations.

16. The interest on working capital should

be Rs.11.52 Crores as against Rs.86.70

Crores claimed for FY15 and Rs.93.74

Crores as against Rs.25.47 Crores

projected in FY17.

The interest on the working capital is

calculated on normative basis and equal

to short term Bank Lending Rate of State

Bank of India.

Commission’s Views: The Commission is allowing the interest on working capital, as

per the norms prescribed in the MYT Regulations.

17. The Commission is requested to

consider Interest on Security Deposits

at 7.75% as published by the RBI on its

website as against 9% as claimed by

GESCOM for FY17 in consonance with

the Clause 3.1 of the KERC (Interest on

Security Deposit) Regulations, 2005

which provides for considering the

bank rate as on 1st April of the

relevant financial year.

GESCOM has proposed 9% on security

deposit. GESCOM abides by the decision

taken by the Commission in this regard.

GESCOM does not accept the interest

charges as calculated by the objector.

Commission’s Views: The interest on security deposit of consumers is being allowed as

per the provisions of the Electricity Act, 2003 and the Regulations issued by the

Commission.

18. GESCOM is quoting only distribution

losses but not ATC losses. ATC losses

are targeted at 13.72%. GESCOM

wants to implement Simulation type

to find out losses. This will not be

realistic.

GESCOM has mentioned about ATC

losses in D19(a) in the petition. However

the GESCOM has not proposed the ATC

Losses target of 13.72% for control period

FY17 to FY19.

Commission’s Views: The Commission has been fixing the distribution loss targets and

no targets for AT & C Losses have been fixed by the Commission.

19. Energy audit at inter phase points is

not done. Energy audit of 15 towns is

not furnished. Figures pertaining to

Energy audit of 8 towns done by CPRI

is not supplied. Voltage wise losses

Energy at interface point is counter

checked by GESCOM and KPTCL. Energy

audit of 11 Towns is furnished on page

No. 14 of the Petition.

ccxiv

are not furnished. When the energy

audit at inter phase points is not

available, the entire losses of

GESCOM become doubtful.

Commission’s Views: Though the details of energy audit are being furnished to the

Commission, it is observed that, there are several data inconsistencies, giving

inaccurate results. The GESCOM has been directed to rectify them and furnish more

consistent data. Compliance to these directions would be monitored by the

Commission.

20. Segregation of commercial and

technical losses as stipulated in the

tariff policy is not done by GESCOM.

The information is already furnished in the

Petition copy under format D-20.

Commission’s Views: The computation of distribution losses at 11 KV feeder level

and DTC levels has already been initiated by the ESCOMs. This enables

determination of technical losses. Further energy auditing at DTC levels,

considering metered energy of the consumers connected to the DTCs,

enables computation of DTC level losses, which also includes commercial

losses besides technical losses. This mechanism of DTC-wise energy audit, after

its full implementation, would enable complete segregation of technical and

commercial losses in the distribution system. With proper studies to measure

the technical losses in the distribution system, it is possible to compute the

commercial losses.

21. Commission, in its Tariff Order 2010

had put a cap of 400 paise per unit for

short term power purchase. GESCOM

has proposed to purchase 73.61 MU

under short term & Medium term

purchases at the cost of Rs.57.27

Crores (at the rate of 508 paise/unit)

(D1)(page - 94) whereas through

Energy Exchange energy is available

at Rs.2.38. per unit. The Commission

should reject the purchase of high cost

power.

The proposed total short term and

medium term power purchase for FY-17 is

about 329.12 MU at a cost of Rs.170.63

Crores and at the rate of Rs.5.08 per unit.

Commission’s Views: The short-term power is being procured through competitive

bidding after approval from the Commission. The ESCOMs are buying power from the

ccxv

IEX on a day ahead basis.

22. The collection efficiency is only 87%.

(page-126). Arrears from Govt.

installations are stated to be

presumed to be collected in working

out the tariff. But arrears are not paid

by the Govt.

The pending dues of local bodies is being

pursued by GESCOM regularly.

Commission’s Views: The recovery of arrears and the recovery of subsidy and

Government dues should be given priority by pursuing the matter with the respective

departments of the Government.

23. Geographical positioning system

though started many years back has

not been completed. This again

reflects inefficiency of GESCOM.

Geographical positioning system is taken

up in RAPDRP projects.

Commission’s Views: GESCOM’s reply is reasonable.

24 Govt. of India has come out with Debt

Restructuring Scheme called Ujwal

Discoms Assurance Yojana (UDAY)

and GESCOM should have opted for

the scheme.

GESCOM is looking in to the Ujwala

Discoms assurance Yojane (UDAY) and

take suitable action.

Commission's Views: State Government has to take a decision on UDAY Scheme.

25. GESCOM has failed to furnish the

Perspective Plan, Depreciation,

advance against depreciation as

required under the Regulations.

The details of Business plan is submitted

vide page no 65 in the petition Capital

works to be taken up for MYT period is

furnished vide page No 32 to 34 and

applicable depreciation is submitted vide

format D18 in the petition. Advance

against the Depreciation is not claimed.

Commission's Views: The reply given by GESCOM is reasonable.

26. KPCL should reduce the cost of

generation from hydel plants which

have been fully depreciated. The PLF

of the thermal stations have come

down to about 60% from 85%. The

Commission may address KPCL and

State Government for improvement

of PLF.

No Comments are offered by GESCOM

ccxvi

Commission’s Views: The functioning of KPCL is not being regulated by the

Commission since generation is not a licensed activity. The power purchase from

KPCL is being regulated through PPAs and approval of Tariff of new stations. The

capacity charges are regulated as per the norms in the PPA/ Regulations issued by

the Commission from time to time.

27. The eligible return on equity is to the

tune of Rs.10.01 Crores during FY17 as

against Rs.90.89 Crores claimed by the

GESCOM.

GESCOM has proposed the probable

“other Debits” for the ensuing control

period. The Commission will not allow in

the ARR but will consider in the truing up

on case to case basis.

Commission’s Views: The reply furnished by the GESCOM is not relevant to the query.

The RoE is being allowed as per the MYT norms.

28. Removing the existing slab system,

uniform tariff should be levied across

all the consumers on par with

telephone tariff, price of fuel such as

petrol, diesel of milk etc. Classification

of categories should be done away

to stop cross subsidisation by various

categories of consumers, Average

cost of power supply per unit should

be the power tariff per unit

irrespective number of power units

consumed by the consumer.

Slab system cannot be removed. This

restricts the use of power supply by

consumers and also helps to apply lower

tariff to below poverty line consumers.

Average cost of power supply cannot

applied to all units consumed by the

consumers. The tariff rate varies for the

various categories of consumers due to

social obligations.

Commission’s Views: The reply furnished by GESCOM is acceptable.

29. Any short term/medium term power

over and above the approved quantum

and purchased at rates exceeding the

ceiling rate should be disallowed.

Reduction of availability from the

designated source resulted in increase in

short term procurement. Short-term

power purchase is done through

tendering after due approval from KERC

and the price is discovered.

Commission’s Views: The State has faced shortage of power due to reduction of

availability from the expected sources, resulting in increase in the quantum of short-

term power purchase. These purchases are being made through competitive

bidding, duly complying with the provisions of the Electricity Act, 2003. The

Commission also notes that PCKL is indeed procuring power through exchange at

lower prices.

ccxvii

2. Objections relating to Quality of Service:

Objections Replies by Licensee

30. There were 86,237 DTCs feeding the IP

sets, during last year. GESCOM has not

given the details as to how many DTCs

are feeding to IP sets this year.

GESCOM has not stated when all DTCs

will be metered. At present IP sets

consumption is calculated based on

sample metering and generalized

which will give misleading results.

The Details of DTC’s metering is furnished

in petition copy in the page No 19.

Commission’s Views: Reply furnished by the GESCOM is reasonable. Necessary

directions have been issued to the GESCOM in the matter.

31. The Commission has directed

GESCOM to complete the work of

metering of DTCs by 31-12-2010.

GESCOM is yet to complete the

project. DTC Metering is very

important for LT line loss calculations.

By knowing this, improvement works

are to be planned, and line losses

can be brought down. GESCOM has

not confirmed when this work will be

completed.

GESCOM is having 75015 DTCs in its

jurisdictional area out of which 55886

DTCs are metered. GESCOM is taking

action for metering the balance 19126

DTCs. The work will be completed during

FY17.

Commission’s Views: Necessary directions have been issued to the GESCOM in the

matter.

32. Commission has ordered to

implement TOD for 500 KVA and

above HT installations, to bring down

the evening peak. GESCOM has

submitted to Commission to continue

TOD. GESCOM has not given any

information as to what extent peak

load has come down. If peak load

has not come down then Commission

may cancel compulsory TOD order

and make it optional.

The Hon’ble Commission has made TOD

as mandatory in respect of HT installations

with contract demand of 500 KVA and

above for HT-2(a), (b) and (c) and HT-1

categories only. GESCOM will abide by

the decision of the Commission in this

regard.

ccxviii

Commission’s Views: Commission notes that the ESCOMs are not measuring the

impact of the ToD tariff to know its advantages and disadvantages. The GESCOM is

therefore directed to report the impact of the ToD tariff and suggest whether any

changes are required in the current arrangement.

33. The power supply situation and quality

of power supply in rural areas have

been deteriorated further during the

current year. Compliance of other

directives is also very poor and no

tangible results have come out, so

far. On these aspects also the ERC

and Tariff filing are defective and

liable to be dismissed as not

maintainable.

The Directions issued by KERC

Commission are regularly complied with

and details are furnished in the petition

filed by GESCOM on 15.12.2015.

Commission’s Views: The Compliance to directives have been separately dealt with

in the Tariff Order.

34. GESCOM has stated that Timer

Switches are yet to be provided to

circuits. Though more than four years

have lapsed GESCOM is yet to

arrange timer switches. The purpose

of bringing down the peak load has

not been pursued with all seriousness.

Thus GESCOM has failed to

implement Demand Side

Management.

The management of street lights comes

under the purview of local bodies. In

Order to prevent the wastage of energy,

the Commission has directed GESCOM to

install the timer switches at its own cost

and recover the same later on from the

local bodies. GESCOM has called the

tender for fixing of timer switches and

action will be taken as soon as possible in

installing the timer switches to street lights.

Commission’s Views: In order to conserve energy, installation of timer switches has

been directed by the Commission. Issues relating to implementation of this direction is

dealt with by the Commission separately.

35. GESCOM proposed in 2013 for

replacement of 1,00,403 less efficient

pump sets by high efficient pump

sets. This will save about 30% of IP

energy consumption. GESCOM has

proposed to provide solar power to

250 IP sets. But work has not started

yet. Further ISI marked motors should

EESL New Delhi is being approached by

GESCOM to sort out the issues relating to

measurement and verification (M&V)

and billing end and the pilot project will

be completed as soon as possible.

ccxix

be made compulsory.

Commission’s Views: The reply of the GESCOM is reasonable. Commission would

monitor the progress of the proposed scheme.

36. The rural areas have a scope in load

management as the pump sets used

for irrigation purposes are highly

inefficient and since power supply is

free, the farmers have least interest

efficiency of the equipment.

GESCOM agrees that the rural areas

have a tremendous scope in load

management as the pump sets used for

irrigations purposes are highly inefficient.

But the replacement of these pump set

requires huge investment. GESCOM is

already facing financial strain in view of

huge accumulated loss and cannot

make huge investment on its own at

present. However, GESCOM is

considering Demand Side Management

System in Agriculture.

Commission’s Views: The replies of the GESCOM are reasonable. The Commission

would monitor the DSM programmes in line with the DSM Regulation.

37. Implementation of HVDS (High

Voltage Distribution System) will bring

down the losses by about 8-10%.

Since Sept 2012, Commission has

been repeatedly instructing GESCOM

to implement HVDS. GESCOM states

that works are started in four sub-

divisions. Out of 78 feeders, work is

completed only in 11 feeders.

Progress is only 14.10%. This is the

status in only 4 sub-divisions. There are

115 sub-divisions in GESCOM. It is not

informed by GESCOM when they will

complete in remaining 111

subdivisions. It appears GESCOM is

not serious in implementing HV DS

GESCOM is in the process of preparing

the DPRs and intends to take up the

schemes on pilot basis in FY-17.

Commission’s Views: The reply of the GESCOM is reasonable. The Commission is

reviewing regularly the progress achieved under this programme.

38. Independent feeders are required for

Industries. There are interruptions and

There are 56 Nos. of industrial feeders in

GESCOM for which uninterrupted power

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load shedding. Industries are suffering

a lot.

supply arranged except during exigency.

Load shedding is implemented to

maintain grid stability.

Commission’s Views: The reply furnished by the GESCOM is acceptable.

39. Commission has directed GESCOM to

achieve HT/LT ratio of 1:1. GESCOM

has not given the HT/LT ratio. In the

last tariff revision petition FY-15,

GESCOM had confirmed that HT/LT

ratio will be brought down to 1:1.63.

But GESCOM has not brought down

the ratio. Present ratio is 1:1.906. This

will result in higher distribution losses.

GESCOM covers an area of six district of

North Karnataka where agriculture is the

main profession and these districts cover

most of the rural area. It is very difficult to

bring down the HT/LT line ratio to 1:1.

However the implementation NJY

scheme may bring down the ratio. The

cost involved in bringing down the ratio

to 1:1 is also huge. However it is

envisaged to bring down the HT/LT ratio

in phases.

Commission’s Views: Reply furnished by the GESCOM is reasonable.

40. GESCOM has not given details of

failures of distribution of transformers. This

high failure is due to no proper

maintenance and the cost incurred to

repair them is high.

Replacement of failed distribution

transformers is covered under Capex. As

per commercial accounting system, the

repair expenses are covered under

revenue expenditure. After repair when

the transformers are replaced under

system improvement, the written down

value of the transformer is booked under

Capex. The details of transformer failure

are furnished in reply to preliminary

observations made by Hon’ble

Commission.

Commission’s Views The reply furnished by the GESCOM is reasonable. The issue is

also discussed in the Tariff Order.

41. GESCOM has not supplied details of

average number of interruptions per

consumer and average duration of

interruptions per consumer.

GESCOM is furnishing details of

interruptions to Commission.

Commission’s Views: The Commission is reviewing the matter in its quarterly review

meetings.

42. As per section 23 of the Act, load In GESCOM area, the power supply is

ccxxi

shedding should be done with the

approval of KERC. GESCOM is

resorting to load shedding without the

approval of KERC. This is a clear

violation. Un scheduled load

shedding have adversely affected

the Industries. KERC should take

appropriate action in this regard.

being given to urban and rural area as

per the approval of GoK. However, in

case of sudden fall in generation,

GESCOM is taking steps to shed the loads

to prevent grid collapse in coordination

with SLDC.

Commission’s Views: The Commission has issued suitable directions to the GESCOM in

the matter of load shedding especially about advance communication to the

consumers through SMS etc. The Commission is also reviewing regularly the reliability

of power supply by the GESCOM

43. Section 55 of Electricity Act has

stipulated no installation should be

serviced without a meter after 10th

June 2005. ESCOMS are still servicing

Installations without meters.100%

metering has not been achieved.

GESCOM has come to the conclusion

that fixing of energy meter to the IP Sets is

not possible as of now. As soon as

GESCOM fixes meters farmers remove

them. For the above reasons KERC has

decided to take up all the IP set

consumers on separate 11 KV feeder for

calculating specific IP Set consumption

used by IP Sets.

Commission’s Views: The Commission in the Tariff Order has given suitable directions

for correct assessment of power consumption by IP Sets even where it is not feasible

to immediately install individual meters.

44. GESCOM has only narrated the

proposed action plan to reduce

accidents and action plan has not

been implemented.

Efforts have been made to reduce the

electrical accidents in GESCOM by

taking safety measures such as providing

safety equipment to linemen by

procuring safety equipment at a cost of

Rs.40.49 lakhs. The accidents in respect of

Human (Fatal and Non -Fatal) have

reduced in FY 15-16. Up to January-16

compared to FY15. During FY15 the fatal

and Non- Fatal Accident were 200 Nos,

and during FY16 (Up to Jan-16) Fatal and

Non- Fatal Accident were 136 Nos.

Commission’s Views: The Commission apart from issuing suitable directions to the

ccxxii

GESCOM on this issue, has been reviewing regularly its compliances.

45. It is obligatory for GESCOM to give

annual abstract of reliability Index of

feeders. For how many feeders the

index is within permissible limits and

for how many it is beyond limits, and

for how many feeders there is

improvement in reliability Index.

GESCOM has not given this

information.

GESCOM is submitting the reliability index

to the Commission. The information is

submitted up to August-2015. Due to

shortage of technical staff the

information is not submitted for the 3rd

quarter. In due course the information will

be submitted to the Commission.

Commission’s Views: The reliability indices, as submitted by the ESCOMs, are being

hosted on the Commission’s website and are also reviewed by the Commission.

46. GESCOM has failed to improve the

efficiency of its operations by

implementing the directives issued by the

KERC. The compliance is poor without

any tangible results.

GESCOM has complied with the

directives of the Commission.

Commission’s Views: Compliance to directives have been extensively dealt with

separately in the tariff order.

47. The applicant has not disclosed any

plan for the introduction of pre-paid

meters as provided under Section

47(5) of the Electricity Act, 2003.

The matter is not yet considered by

GESCOM.

Commission’s Views: The Conditions of Supply provide for installation of prepaid

meters to all the temporary installations and the ESCOMs are bound to follow

the Regulations. GESCOM’s is compliance on this regard would be

periodically reviewed.

48. Slab-wise sanctioned load, fixed

charges, energy charges and

consumption are not made available

by GESCOM. GIS mapping of at least

one feeder with transformer centres

should have been given by GESCOM

which is not done though instructed

by the Commission.

The slab-wise sanction load, fixed

charges, energy charges and

consumption and consumption are

made available in the petition copy of

format D-21(a). The GIS mapping of

Siddeshwara feeders in Gulbarga Town is

done. The tenders are called for GIS

mapping of other feeders. The work will

be taken up during FY-17.

Commission’s Views: Reply furnished by GESCOM is acceptable. However, furnishing

ccxxiii

slab-wise details within a tariff category is not practicable, as the consumption and

load factor keep changing month on month.

49. Detection of Power theft cases are

mostly the cases of disproportionate

power sanctions leading to reduced

collection of fixed charges. Based on

power consumption of consumer, the

GESCOM Officials may ask the

consumer to get the matching power

sanctioned and pay the fixed

charges. This reduces the work of

GESCOM Officials as well as restores

dignity and peace to the consumers.

The fixed charges depending of the

sanction load are approved by KERC.

For detection of connected load new

metering arrangement is being made

which will record the connected load of

the installation and action is being taken

to penalise the consumers who availed

more than the sanctioned load.

Commission’s Views: This is not a tariff issue.

3. Specific Requests :

Objections Replies by Licensee

50. OA may be extended to consumers

drawing power below 1 MW

GESCOM opposes extension of open

access to consumers of below 1MW.

Commission’s Views: As per the provisions of the KERC (Terms and Conditions for

Open Access) Regulations, 2004 as amended from time to time, consumers with

contract demand 1-MW and above are eligible for Open Access. This is as per the

provisions of the Electricity Act, 2003.

51. Tariff should be comparable with

other States

The cost parameters in different states

are not comparable and such

comparison is not feasible.

Commission’s Views: The reply furnished is acceptable.

52. The small scale industries may be

exempted from the tariff revision.

There should be a separate tariff for

small scale industries, which should

be Re. 1 less than other categories.

GESCOM prays Commission not to

consider the objections raised by the

objector and requests to revise the Tariff

as proposed in the Tariff Filing application

for the Year FY17.

Commission’s Views: Every consumer has to absorb the revision of tariff proportionate

to the increase in cost of supply year on year to make the business of distribution

viable in the interest of all stakeholders.

53. 5 paise and 15 paise reduction in tariff

given to rural areas appears to be

meagre. Further reduction may be

Determination of tariff to rural area is

based on purchasing capacity and there

can be only a marginal difference

ccxxiv

given. between urban and rural tariff.

Commission’s Views: The matter is appropriately dealt in this Tariff Order.

54. ESCOM is insisting the consumers to

purchase and maintain the meters. It

is requested that the amount paid

by the consumer towards purchase

of meters should be considered as

meter security deposit, so that the

meter will be the property of the

company.

The contention of the consumer is correct

but this is the forum for discussing tariff

revision only.

Commission’s Views: It is for enabling speedy service connections, the facility of

installed meters at the cost of consumers is provided. As regards treating the meter

cost as security deposit, there are no provisions to this effect. The cost of meter met

by the consumer is treated as consumers’ contribution for service connection.

55. As the Police Stations/offices do not

carry out any commercial activity, they

may be re-categorized under LT-2(a) i.e.,

domestic category similar to fire service

Stations as against LT-3 applicable for

commercial category.

The purpose for which supply is required

by 931 police stations/offices is to carry

out business, clerical or professional

activities. The dictionary meaning of the

word 'Office' is a room, set of rooms, or

building used as a place of business for

non-manual work. Hence, police

stations/offices are comparable with

GESCOM offices, post offices, pvt. offices.

Therefore, they are billed under LT3 tariff.

On the contrary "Fire- service Station"

means a building where fire fighting

vehicles and equipment are stationed

and where fire fighters on duty wait.

Accordingly, they are billed under LT2(a)

tariff. "Fire- service Stations" are not

analogous to police stations. If domestic

tariff of Rs.4.71 per unit is made

applicable to police stations, then some

high-end consumer has to bear the cross-

subsidy of 94 paise per unit. High-end

consumers are going on Open Access to

avoid the tariff hike.

ccxxv


56. Demand-based tariff may be

extended to LT2, LT 4, LT 6 and LT7

categories. The consumers will not

have any unnecessary interference

in his installations and the exact load

on transformers can be calculated.

Demand based tariff is provided to LT3

and LT5 category having connected

load of 5kW and above. As per the

provisions of demand based tariff, the

consumers can have the load more than

the sanctioned load in his premises. In

case of LT2(a) as per the Regulations,

fixed charges for domestic and A.E.H

category shall be based on the

sanctioned load, irrespective of the

connected load, as long as the load

limiter is working in good condition.

Hence, demand based tariff is not

suitable for this category. Other

categories such as LT2(b) (except

educational institutions), LT4, LT6 and LT7

should not have the load more than

sanctioned load. As, the meters fixed to

these categories of installations have no

option for recording maximum demand.


57. Under LT2(a) category, the MCB is

provided as per the sanctioned load. It is

requested that the MCBs should be

supplied by the ESCOMs to avoid conflict

about the genuineness of the MCB and

the MCBs should be sealed along with

the meter during the service connection.

The Objector may look into the

amendments issued by the Commission

on 25th Jan 2016. The amended

Regulations enable the licensee to bill the

installations on the MD recorded or

sanctioned load whichever is higher for

installations where static meters are fixed.

Commission’s Views: The issue does not pertain to tariff.

58. An appropriate roadmap for 100%

metering indicating incentives and

disincentives should be approved by the

Commission.

GESCOM has come to the conclusion

that fixing of energy meter to the IP Set

not possible as of now. As soon as

GESCOM fixes meters the farmers remove

the Energy meter. For the above reasons

KERC has decided to take of all the IP

sets consumer on separate 11 KV feeder

ccxxvi

and start calculating specific IP Set

consumption used by IP Sets. In this

regard, GESCOM states that all

categories are metered in GESCOM

except agriculture category and some in

BJ / KJ Category. Action is being taken to

fix the meters to remaining unmetered

installations in BJ KJ category

Commission’s Views: The issue of metering of IP sets hs been discussed in the Tariff

Order.

59. Bachat Lamp Yojana is a good

scheme for energy saving. But progress is

only 10%. GESCOM has not indicated

when the remaining 90% work will be

completed. LEDs save 40% of energy

consumption. GESCOM has not given the

statistics as to how many LED lamps are

supplied to the Consumers. At least this is

may be made mandatory for Govt.

buildings.

In GESCOM the Energy Saving Project i.e

DELP is introduced in which LEDs are

supplied at cheaper rates. This scheme is

also implemented on easy instalments.

GESCOM as on date has supplied

102000 LED bulbs at cheaper rates and

the issue of mandatory usage of LED’s in

Government buildings has to be decided

by the State Government.

Commission’s Views: The reply furnished is acceptable.

60. GESCOM should furnish the time

frame for completion of remaining

feeders in Phase II and Phase III of

NJY scheme. GESCOM should

quantify the improvement in power

supply achieved in rural areas by

implementation of NJY scheme.

The NJY works are under progress. The

details of the benefits accrued from the

NJY Scheme is submitted in the MYT

Petition in the page No. 22.

Commission’s Views: Reply furnished by the GESCOM is acceptable. The Commission

is reviewing the matter regularly in its review meeting.

61. LT2(b) tariff was extended to nursing

homes and hospitals in the previous

Tariff Orders. Since, the nursing

homes and hospitals are equipped

with scanning and X-ray machines,

they are not eligible for LT2(b) tariff.

Hence, the Commission may insert

For such installation, LT-3 tariff is being

applied.

ccxxvii

the word "dispensary and out-

patient medical practitioner" instead

of nursing homes and hospitals.

Commission’s Views: The Commission would take appropriate decisions after

examining the suggestion.

ccxxviii

The gist of the submissions made during the Public Hearing, held on

04.03.2016.

1

Distribution losses in Shahabad, Yadgir and

Raichur are on a higher side, GESCOM has not

taken remedial measures to reduce the losses.

GESCOM should increase the vigilance raids to

curb theft of power.

GESCOM has replied to the points raised by the

public.

2

The proposal of GESCOM to extend the

banking facility up to summer should not be

considered.

3

The exiting tariff for industrial consumers is

already high. Any further increase in tariff as

proposed by GESCOM will force to industrial

customers to opt for open access.

4

The power is available at cheaper rates in the

power exchanges. ESCOMs have to buy power

from these exchanges to reduce power

purchase cost.

5 Cross subsidy surcharge should be determined

as per new tariff policy.

6

Providing capacitors to IP sets will save 8% to

10% of power, hence GESCOM should be

instructed to provide required capacitors to IP

sets

7

GESCOM has collected meter security deposit

in respect of IP Sets serviced under Ganga

Kalyana, but shown the consumption as

unmetered sales.

8 Green Tariff for HT consumers should be made

compulsory.

9

SoP should be implemented strictly and

adequate publicity should be given. SoP

should be published in Kannada in all the O &

M and section offices.

ccxxix

10

Misappropriation of funds to the tune of several

lakhs pointed out in the C&AG audit reports

have to be recovered from the officers.

11 The toll free telephone complaint facility is not

extended to rural areas.

12

Cement factories stated to be captive

generators are drawing power from GESCOM

illegally and necessary action needs to be

taken.

13

Even though the farmers have paid the

requisite amount for regularisation of IP Sets, no

infrastructure has been created by GESCOM.

14 GESCOM has not undertaken any activity

under corporate social responsibilities.

15 The number of categories in the tariff order

should be reduced for rationalization of tariff.

16

Solar powered IP sets should be encouraged to

save power significantly and adequate

publicity should be given to encourage farmers

to install solar IP Sets.

17 Power supply is tapped by Dargah, Temples

and community halls.

18 The houses with shops in the premises should be

billed under commercial tariff.

Commission's Views: The Commission has considered the points raised by the public and the replies

given by GESCOM, while passing this Tariff Order.

ccxxx

ANNEXURE – I

ESCOMS’ TOTAL APPROVED POWER PURCHASE FOR FY17

NAME OF THE GENERATING STATION

ENERGY

ALLOWE

D (MU)

CAPACIT

Y

CHARGES

(RS Cr)

ENERGY

CHARG

ES (RS

Cr)

TOTAL

COST

(RS Cr)

PER UNIT

RATE

(RS/

Kwh)

KPCL THERMAL STATIONS

RAICHUR THERMAL POWER STATION_RTPS 1-7 (7x210) 7538.53 619.64 2327.80 2947.44 3.91

RAICHUR THERMAL POWER STATION_RTPS 8 (1x250) 1510.85 211.06 454.42 665.49 4.40

BELLARY THERMAL POWER STATIONS_BTPS-1 (1x500) 2823.10 295.60 1035.95 1331.55 4.72



TOTAL KPCL THERMAL 17646.77 1570.36 5681.72 7252.08 4.11

CGS SOURCES

N.T.P.C-RSTP-I&II (3X200MW+3X500MW) 3246.74 197.69 739.53 937.23 2.89

N.T.P.C-RSTP-III (1X500MW) 819.69 75.28 192.48 267.76 3.27

NTPC-Talcher (4X500MW) 2765.03 213.25 400.36 613.61 2.22

Simhadri Unit -1 &2 (2X500MW) 1490.74 226.09 363.15 589.24 3.95

NTPC Tamilnadu Energy Company Ltd (NTECL)_Vallur TPS Stage I

&2 &3 (3X500MW) 1081.78 174.91 222.18 397.09 3.67

Neyveli Lignite Corporation_NLC TPS-II STAGE I (3X210MW) 950.35 68.49 228.93 297.41 3.13

Neyveli Lignite Corporation_NLC TPS-II STAGE 2 (4X210MW) 1280.64 105.25 308.49 413.73 3.23

Neyveli Lignite Corporation_NLC TPS I EXP (2X210MW) 731.33 90.16 182.73 272.90 3.73

Neyveli Lignite Corporation_NLC TPS2 EXP (2X250MW) 865.82 111.21 199.16 310.37 3.58

NLC TAMINADU POWER LIMITED (NTPL) (TUTICORIN) (2X500MW) 1442.76 185.27 371.08 556.34 3.86

MAPS (2X220MW) 249.31 0.00 49.86 49.86 2.00

Kaiga Unit 1&2 (2X220MW) 922.44 0.00 274.89 274.89 2.98

Kaiga Unit 3 &4 (2X200MW) 1001.80 0.00 298.54 298.54 2.98

NPCIL-Kudan Kulam Atomic Power Generating Station (KKNPP)

(1X1000MW) 1527.09 0.00 455.07 455.07 2.98

DVC-Unit-1 &2 Meja TPS (2x500MW) 1574.83 274.91 360.39 635.30 4.03

DVC-Unit-7 & 8-KODERMA TPS (2x500MW) 1574.83 261.62 349.87 611.49 3.88

TOTAL CGS 21525.17 1984.13 4996.71 6980.84 3.24

TOTAL MAJOR IPPS

UDUPI POWER CORPORATION LIMITED_UPCL (2x600) 7462.68 1325.73 1767.94 3093.67 4.15

KPCL HYDEL STATIONS

SHARAVATHI VALLEY PROJECT_SVP (10x103.5+2x27.5) 4203.20 20.49 182.11 202.60 0.48

MAHATMA GANDHI HYDRO ELECTRIC POWER HOUSE_MGHE

(4x21.6+4x13.2) 180.68 2.32 17.79 20.11 1.11

GERUSOPPA_GPH (SHARAVATHI TAIL RACE_STR) (4x60) 527.47 24.38 55.93 80.30 1.52

KALI VALLEY PROJECT_KVP (2x50+5x150+1x135) 2923.95 19.16 229.11 248.27 0.85

VARAHI VALLEY PROJECT_VVP (4x115+2x4.5) 1087.86 11.82 129.40 141.22 1.30

ALMATTI DAM POWER HOUSE_ADPH (1x15+5x55) 523.72 27.51 80.48 107.99 2.06

ccxxxi

BHADRA HYDRO ELECTRIC POWER HOUSE_BHEP

((1x2+2x12)+(1x7.2+1x6)) 65.15 1.14 29.76 30.90 4.74

KADRA POWER HOUSE_KPH (3x50) 355.25 19.15 47.57 66.72 1.88

KODASALLI DAM POWER HOUSE_KDPH (3x40) 325.56 12.00 34.43 46.42 1.43

GHATAPRABHA DAM POWER HOUSE_GDPH (2x16) 91.67 1.96 14.77 16.74 1.83

SHIVASAMUDRAM (4x4+6x3) & SHIMSHAPURA (2x8.6) HYDRO

STATIONS_SHIVA & SHIMSHA 310.76 3.54 27.46 31.00 1.00

MUNIRABAD POWER HOUSE (2x9+1x10) 109.63 0.43 8.68 9.11 0.83

TOTAL KPCL HYDRO 10704.90 143.90 857.48 1001.38 0.94

OTHERS

PRIYADARSHINI JURALA HYDRO ESLECTRIC STATION (6x39) 111.61 65.09 0.00 65.09 5.83

TUNGABHADRA DAM POWER HOUSE_TBPH (4x9+4x9) 32.47 2.64 0.00 2.64 0.81

TOTAL OTHER HYDRO 144.08 67.73 0.00 67.73 4.70

SHORT TERM POWER

SHORT TERM POWER 1108.80 0.00 558.84 558.84 5.04

NON-CONVENTIONAL ENERGY SOURCES

WIND-IPPS 3826.75 0.00 1368.74 1368.74 3.58

KPCL-WIND (9x0.225+10x0.230) 12.86 0.00 4.32 4.32 3.36

MINI HYDEL-IPPS 1344.12 0.00 450.45 450.45 3.35

CO-GEN/CAPTIVE 172.09 0.00 65.02 65.02 3.78

BIOMASS 196.60 0.00 97.72 97.72 4.97

SOLAR-IPP 1261.40 0.00 784.50 784.50 6.22

SOLAR-KPCL (YELESANDRA,ITNAL,YAPALDINNI,SHIMSHA)

(3x1+3x1+1x3x1x5) 32.89 0.00 19.63 19.63 5.97

TOTAL NCE 6846.71 0.00 2790.38 2790.38 4.08

TRANSMISSION CHARGES

PGCIL CHARGES 949.21 949.21 0.44

KPTCL CHARGES 3092.77 3092.77 0.47

SLDC & POSOCO CHARGES 19.99 19.99 0.003

TOTAL INCLUDING TRANSMISSION & LDC CHARGES 65439.11 5091.87 20715.0

2

25806.8

9 3.94



ENERGY

ALLOWED

(MU)

CAPACI

TY

CHARGE

S (RS Cr)

ENERGY

CHARGES

(RS Cr)

TOTAL

COST

(RS Cr)

PER UNIT

RATE

(RS/

Kwh)






ccxxxii



CGS SOURCES


N.T.P.C-RSTP-III (1X500MW) 819.69 75.28 196.33 271.61 3.31

NTPC-Talcher (4X500MW) 2765.03 213.25 408.37 621.62 2.25



&2 &3 (3X500MW) 1081.78 176.33 226.63 402.96 3.72






MAPS (2X220MW) 249.31 0.00 50.86 50.86 2.04

Kaiga Unit 1&2 (2X220MW) 922.44 0.00 280.39 280.39 3.04

Kaiga Unit 3 &4 (2X200MW) 1001.80 0.00 304.51 304.51 3.04


(1X1000MW) 1527.09 0.00 464.17 464.17 3.04



TOTAL CGS 21525.17 1985.60 5096.64 7082.24 3.29

TOTAL MAJOR IPPS


KPCL HYDEL STATIONS



(4x21.6+4x13.2) 195.03 2.32 20.00 22.32 1.14






((1x2+2x12)+(1x7.2+1x6)) 63.36 1.14 30.59 31.73 5.01





STATIONS. 330.66 3.54 30.45 33.99 1.03


TOTAL KPCL HYDRO 12045.33 142.53 956.63 1099.16 0.91

OTHER HYDRO

ccxxxiii



TOTAL OTHER HYDRO 144.08 71.64 0.00 71.64 4.97


WIND-IPPS 3981.63 0.00 1424.99 1424.99 3.58

KPCL-WIND (9x0.225+10x0.230) 12.86 0.00 4.32 4.32 3.36

MINI HYDEL-IPPS 1344.81 0.00 450.68 450.68 3.35

CO-GEN/CAPTIVE 172.09 0.00 64.12 64.12 3.73

BIOMASS 262.15 0.00 135.15 135.15 5.16

SOLAR-IPP 2588.38 0.00 1314.95 1314.95 5.08


(3x1+3x1+1x3x1x5) 32.89 0.00 19.63 19.63 5.97

TOTAL NCE 8394.81 0.00 3413.83 3413.83 4.07


PGCIL CHARGES 958.70 958.70 0.45

KPTCL CHARGES 3171.28 3171.28 0.46


TOTAL INCLUDING TRANSMISSION & LDC CHARGES 68895.57 5569.41 21774.55 27343.96 3.97



ENERGY

ALLOWED

(MU)

CAPACI

TY

CHARGE

S (RS Cr)

ENERGY

CHARGES

(RS Cr)

TOTAL

COST

(RS Cr)

PER UNIT

RATE

(RS/

Kwh)







YERMARUS THERMAL POWER STATION_YTPS (2x800) 1547.46 204.23 413.13 617.36 3.99


CGS SOURCES


N.T.P.C-RSTP-III (1X500MW) 819.69 75.28 200.26 275.54 3.36

NTPC-Talcher (4X500MW) 2765.03 213.25 416.53 629.79 2.28



&2 &3 (3X500MW) 1081.78 176.33 231.16 407.49 3.77


ccxxxiv





MAPS (2X220MW) 249.31 0.00 51.88 51.88 2.08

Kaiga Unit 1&2 (2X220MW) 922.44 0.00 285.99 285.99 3.10

Kaiga Unit 3 &4 (2X200MW) 1001.80 0.00 310.60 310.60 3.10


(1X1000MW) 1527.09 0.00 473.46 473.46 3.10



TOTAL CGS 21525.17 1985.60 5198.58 7184.17 3.34

TOTAL MAJOR IPPS


KPCL HYDEL STATIONS



(4x21.6+4x13.2) 195.03 2.32 20.83 23.16 1.19






((1x2+2x12)+(1x7.2+1x6)) 63.36 1.14 32.33 33.47 5.28





STATIONS_SHIVA & SHIMSHA 330.66 3.54 31.75 35.29 1.07


TOTAL KPCL HYDRO 12045.33 138.20 1001.17 1139.37 0.95

OTHERS



TOTAL OTHERS 144.08 75.78 0.00 75.78 5.26


WIND-IPPS 4649.94 0.00 1669.14 1669.14 3.59

KPCL-WIND (9x0.225+10x0.230) 12.86 0.00 4.32 4.32 3.36

MINI HYDEL-IPPS 1443.36 0.00 483.69 483.69 3.35

CO-GEN/CAPTIVE 172.09 0.00 64.12 64.12 3.73

BIOMASS 262.15 0.00 135.15 135.15 5.16

SOLAR-IPP 3692.28 0.00 2076.14 2076.14 5.62

ccxxxv


(3x1+3x1+1x3x1x5) 32.89 0.00 19.63 19.63 5.97

NTPC- SOLAR 0.00 0.00 0.00 0.00 0.00

TOTAL NCE 10265.57 0.00 4452.20 4452.20 4.34


PGCIL CHARGES 968.29 968.29 0.45

KPTCL CHARGES 3472.60 3472.60 0.48


TOTAL INCLUDING TRANSMISSION & LDC CHARGES 72435.72 5795.47 23888.11 29683.58 4.10

ccxxxvi

ANNEXURE - II

APPROVED POWER PURCHASE FOR GESCOM’S - FY17


% SHARE

OF

ENERGY

ALLOWED

ENERGY

ALLOWE

D (MU)

CAPACI

TY

CHARGE

S (RS Cr)

ENERGY

CHARGE

S (RS Cr)

TOTAL

COST

(RS Cr)

PER UNIT

RATE

(RS/ Kwh)


RAICHUR THERMAL POWER STATION_RTPS 1-7 (7x210) 2.304 173.678 14.276 53.630 67.905 3.910

RAICHUR THERMAL POWER STATION_RTPS 8 (1x250) 13.683 206.731 28.880 62.179 91.059 4.405

BELLARY THERMAL POWER STATIONS_BTPS-1 (1x500) 13.683 386.288 40.448 141.750 182.197 4.717



TOTAL KPCL THERMAL 13.683 1556.801 144.365 512.550 656.915 4.220

CGS SOURCES

N.T.P.C-RSTP-I&II (3X200MW+3X500MW) 13.683 444.255 27.051 101.191 128.242 2.887

N.T.P.C-RSTP-III (1X500MW) 13.683 112.159 10.301 26.338 36.638 3.267

NTPC-Talcher (4X500MW) 13.683 378.343 29.180 54.782 83.961 2.219

Simhadri Unit -1 &2 (2X500MW) 13.683 203.980 30.936 49.690 80.627 3.953

NTPC Tamilnadu Energy Company Ltd (NTECL)_Vallur TPS

Stage I &2 &3 (3X500MW) 13.683 148.022 23.933 30.402 54.335 3.671

Neyveli Lignite Corporation_NLC TPS-II STAGE I

(3X210MW) 13.683 130.037 9.371 31.324 40.695 3.130

Neyveli Lignite Corporation_NLC TPS-II STAGE 2

(4X210MW) 13.683 175.231 14.401 42.211 56.612 3.231

Neyveli Lignite Corporation_NLC TPS I EXP (2X210MW) 13.683 100.069 12.337 25.004 37.341 3.732

Neyveli Lignite Corporation_NLC TPS2 EXP (2X250MW) 13.683 118.471 15.217 27.251 42.469 3.585

NLC Taminadu Power Limited (NTPL) (Tuticorin)

(2x500mw) 13.683 197.415 25.350 50.775 76.125 3.856

MAPS (2X220MW) 13.683 34.113 0.000 6.823 6.823 2.000

Kaiga Unit 1&2 (2X220MW) 13.683 126.219 0.000 37.613 37.613 2.980

Kaiga Unit 3 &4 (2X200MW) 13.683 137.077 0.000 40.849 40.849 2.980

NPCIL-Kudan Kulam Atomic Power Generating Station

(KKNPP) (1X1000MW) 13.683 208.953 0.000 62.268 62.268 2.980

DVC-Unit-1 &2 Meja TPS (2x500MW) 13.683 215.486 37.616 49.313 86.929 4.034

DVC-Unit-7 & 8-KODERMA TPS (2x500MW) 13.683 215.486 35.798 47.873 83.671 3.883

TOTAL CGS 13.683 2945.314 271.491 683.706 955.197 3.243

TOTAL MAJOR IPPS

UDUPI POWER CORPORATION LIMITED_UPCL (2x600) 13.683 1021.127 181.402 241.909 423.311 4.146

KPCL HYDEL STATIONS

SHARAVATHI VALLEY PROJECT_SVP (10x103.5+2x27.5) 34.092 1432.957 6.985 62.083 69.069 0.482

MAHATMA GANDHI HYDRO ELECTRIC POWER

HOUSE_MGHE (4x21.6+4x13.2) 13.683 24.723 0.318 2.434 2.752 1.113

GERUSOPPA_GPH (SHARAVATHI TAIL RACE_STR) (4x60) 13.683 72.174 3.336 7.652 10.988 1.522

KALI VALLEY PROJECT_KVP (2x50+5x150+1x135) 13.683 400.088 2.621 31.350 33.971 0.849

VARAHI VALLEY PROJECT_VVP (4x115+2x4.5) 13.683 148.853 1.617 17.706 19.323 1.298

ALMATTI DAM POWER HOUSE_ADPH (1x15+5x55) 13.683 71.661 3.764 11.012 14.776 2.062


((1x2+2x12)+(1x7.2+1x6)) 13.683 8.915 0.156 4.072 4.228 4.743

KADRA POWER HOUSE_KPH (3x50) 13.683 48.609 2.620 6.509 9.129 1.878

KODASALLI DAM POWER HOUSE_KDPH (3x40) 13.683 44.547 1.642 4.710 6.352 1.426

GHATAPRABHA DAM POWER HOUSE_GDPH (2x16) 13.683 12.543 0.269 2.021 2.290 1.826

ccxxxvii

SHIVASAMUDRAM (4x4+6x3) & SHIMSHAPURA (2x8.6)

HYDRO STATIONS 13.683 42.522 0.485 3.757 4.242 0.998

MUNIRABAD POWER HOUSE (2x9+1x10) 13.683 15.001 0.059 1.188 1.247 0.831

TOTAL KPCL HYDRO 21.697 2322.592 23.872 154.495 178.368 0.768

OTHERs

PRIYADARSHINI JURALA HYDRO ESLECTRIC STATION

(6x39) 13.683 15.272 8.906 0.000 8.906 5.832

TUNGABHADRA DAM POWER HOUSE_TBPH (4x9+4x9) 13.683 4.443 0.361 0.000 0.361 0.813

TOTAL OTHERs 13.683 19.715 9.268 0.000 9.268 4.701

SHORT TERM POWER 13.683 151.718 0.000 76.467 76.467 5.040

RENEWABLE SOURCES

WIND-IPPS 163.560 0.000 58.391 58.391 3.570

KPCL-WIND (9x0.225+10x0.230) 0.000 0.000 0.000 0.000 0.000

MINI HYDEL-IPPS 119.580 0.000 40.059 40.059 3.350

CO-GEN/CAPTIVE 33.260 0.000 10.710 10.710 3.220

BIOMASS 123.140 0.000 60.210 60.210 4.890

SOLAR-IPP 147.460 0.000 90.835 90.835 6.160


(3x1+3x1+1x3x1x5) 4.380 0.000 2.630 2.630 5.080

TOTAL RENEWABLE SOURCES 591.380 0.000 262.836 262.836 4.444


PGCIL CHARGES 129.881 129.881 0.441

KPTCL CHARGES 402.840 402.840 0.468


TOTAL INCLUDING TRANSMISSION & LDC CHARGES 13.683 8608.648 630.398 2467.333 3097.731 3.598



% SHARE

OF

ENERGY

ALLOWED

ENERGY

ALLOWED

(MU)

CAPACI

TY

CHARGE

S (RS Cr)

ENERGY

CHARGE

S (RS Cr)

TOTAL

COST

(RS Cr)

PER UNIT

RATE

(RS/Kwh

)







ccxxxviii


CGS SOURCES


N.T.P.C-RSTP-III (1X500MW) 13.419 109.995 10.102 26.346 36.448 3.314

NTPC-Talcher (4X500MW) 13.419 371.045 28.617 54.799 83.416 2.248



Stage I &2 &3 (3X500MW) 13.419 145.166 23.662 30.412 54.074 3.725


(3X210MW) 13.419 127.529 9.190 31.334 40.525 3.178


(4X210MW) 13.419 171.851 14.123 42.225 56.348 3.279




(2x500mw) 13.419 193.607 24.861 50.791 75.653 3.908

MAPS (2X220MW) 13.419 33.455 0.000 6.825 6.825 2.040

Kaiga Unit 1&2 (2X220MW) 13.419 123.784 0.000 37.625 37.625 3.040

Kaiga Unit 3 &4 (2X200MW) 13.419 134.433 0.000 40.862 40.862 3.040


(KKNPP) (1X1000MW) 13.419 204.922 0.000 62.288 62.288 3.040



TOTAL CGS 13.419 2888.503 266.451 683.928 950.379 3.290

TOTAL MAJOR IPPS


KPCL HYDEL STATIONS



HOUSE_MGHE (4x21.6+4x13.2) 13.419 26.171 0.311 2.684 2.995 1.144






((1x2+2x12)+(1x7.2+1x6)) 13.419 8.502 0.153 4.105 4.258 5.008





HYDRO STATIONS 13.419 44.372 0.476 4.086 4.561 1.028


TOTAL KPCL HYDRO 13.419 1616.385 19.127 128.372 147.498 0.913

OTHERs


(6x39) 13.419 14.978 9.259 0.000 9.259 6.182


TOTAL OTHERS 13.419 19.335 9.613 0.000 9.613 4.972

RENEWABLE SOURCES

WIND-IPPS 220.090 0.000 78.792 78.792 3.580

ccxxxix

KPCL-WIND (9x0.225+10x0.230) 0.000 0.000 0.000 0.000 0.000

MINI HYDEL-IPPS 119.580 0.000 40.059 40.059 3.350

CO-GEN/CAPTIVE 33.260 0.000 10.710 10.710 3.220

BIOMASS 188.690 0.000 97.640 97.640 5.175

SOLAR-IPP 351.870 0.000 178.750 178.750 5.080


(3x1+3x1+1x3x1x5) 4.380 0.000 2.630 2.630 5.080



PGCIL CHARGES 128.650 128.650 0.445

KPTCL CHARGES 388.580 388.580 0.430


TOTAL INCLUDING TRANSMISSION & LDC CHARGES 13.419 9036.580 747.370 2835.158 3582.528 3.964



% SHARE

OF

ENERGY

ALLOWED

ENERGY

ALLOWED

(MU)

CAPACI

TY

CHARGE

S (RS Cr)

ENERGY

CHARGE

S (RS Cr)

TOTAL

COST

(RS Cr)

PER UNIT

RATE

(RS/

Kwh)







YERMARUS THERMAL POWER STATION_YTPS (2x800) 13.331 206.296 27.226 55.076 82.301 3.989


CGS SOURCES


N.T.P.C-RSTP-III (1X500MW) 13.331 109.274 10.036 26.697 36.733 3.362

NTPC-Talcher (4X500MW) 13.331 368.613 28.429 55.529 83.958 2.278



Stage I &2 &3 (3X500MW) 13.331 144.215 23.507 30.816 54.323 3.767


(3X210MW) 13.331 126.693 9.130 31.751 40.882 3.227

ccxl


(4X210MW) 13.331 170.725 14.031 42.787 56.817 3.328




(2x500mw) 13.331 192.338 24.698 51.468 76.166 3.960

MAPS (2X220MW) 13.331 33.236 0.000 6.916 6.916 2.081

Kaiga Unit 1&2 (2X220MW) 13.331 122.973 0.000 38.126 38.126 3.100

Kaiga Unit 3 &4 (2X200MW) 13.331 133.552 0.000 41.406 41.406 3.100


(KKNPP) (1X1000MW) 13.331 203.579 0.000 63.118 63.118 3.100



TOTAL CGS 13.331 2869.569 264.705 693.034 957.738 3.338

TOTAL MAJOR IPPS


KPCL HYDEL STATIONS



HOUSE_MGHE (4x21.6+4x13.2) 13.331 26.000 0.309 2.778 3.087 1.187






((1x2+2x12)+(1x7.2+1x6)) 13.331 8.447 0.152 4.310 4.462 5.283





HYDRO STATIONS 13.331 44.081 0.472 4.233 4.705 1.067


TOTAL KPCL HYDRO 13.331 1605.790 18.424 133.468 151.892 0.946

OTHERS


(6x39) 13.331 14.879 9.750 0.000 9.750 6.552


TOTAL OTHERS 13.331 19.208 10.102 0.000 10.102 5.259

RENEWABLE SOURCES

WIND-IPPS 333.570 0.000 119.752 119.752 3.590

KPCL-WIND (9x0.225+10x0.230) 0.000 0.000 0.000 0.000 0.000

MINI HYDEL-IPPS 119.580 0.000 40.059 40.059 3.350

CO-GEN/CAPTIVE 33.260 0.000 10.710 10.710 3.220

BIOMASS 188.690 0.000 97.640 97.640 5.175

SOLAR-IPP 518.250 0.000 263.271 263.271 5.080


(3x1+3x1+1x3x1x5) 4.380 0.000 2.630 2.630 5.080



PGCIL CHARGES 129.084 129.084 0.450

ccxli

KPTCL CHARGES 410.880 410.880 0.433


TOTAL INCLUDING NCE, TRANSMISSION & LDC CHARGES 13.331 9485.773 772.608 3072.634 3845.242 4.054

ccxlii

With ref. to

ACS

Sales-MU Revenue

Rs. crores

Sales-MU Revenue

Rs. crores

1

LT-1[fully

subsidised by

GoK]*

Bhagya Jyothi/Kutir Jyothi

165.67 105.37 118.60 68.43 5.77 0.00 -2.70

2

LT-2(a)(i) Dom. / AEH - Applicable to City

Municipal Corporations areas and all

area under Urban Local Bodies. 746.25 499.17 764.36 406.81 5.32 -7.76 -10.25

4

LT-2(a)(ii) Dom. / AEH - Applicable to areas

under Village Panchayats 271.27 144.32 303.71 145.78 4.80 -16.81 -19.06

5

LT-2(b)(i) Pvt. Educational Institutions

Applicable to all areas of Local

Bodies including City Corporations 7.76 5.13 7.76 6.03 7.77 34.73 31.09

6

LT-2(b)(ii) Pvt. Educational Institutions

Applicable to areas under Village

Panchayats 1.44 1.18 1.44 1.01 7.01 21.35 18.08

7

LT-3(i) Commercial - Applicable in areas

under all ULBs including City

Corporations. 213.70 198.24 213.70 175.14 8.20 42.04 38.20

8

LT-3(ii) Commercial - Applicable to areas

under Village Panchayats 75.44 69.45 75.44 59.19 7.85 35.98 32.31

9 LT-4(a)* IP<=10HP 3193.63 1782.3 3306.88 1663.36 5.03 -12.82 -15.18

10 LT-4(b) IP>10HP 11.81 4.04 11.81 4.65 3.94 -31.83 -33.67

11

LT-4 (c) (i) Pvt. Nurseries, Coffee & Tea

Plantations of sanctioned load of 10

HP & below 0.51 0.23 1.44 0.49 3.40 -41.52 -43.10

12

LT-4 (c) (ii) Pvt. Nurseries, Coffee & Tea

Plantations of sanctioned load of

above 10 HP 0.93 0.33 0.00 0.00 0.00 0.00 0.00

13 LT-5(a) LT Industrial 116.57 73.15 115.89 51.51 4.44 -22.96 -25.04

LT-5 (b) 56.61 45.45 56.28 41.17 7.32 26.78 23.36

14 LT-6 Water supply 180.07 84.70 167.15 71.54 4.28 -25.82 -27.82

15 LT-6 Public lighting 245.73 150.09 237.51 138.65 5.84 1.17 -1.56

16 LT-7 Temporary supply 18.43 18.47 18.43 17.51 9.50 64.64 60.20

5305.83 3181.63 5400.40 2851.27 5.28 -8.78 -10.97

1 HT-1 Water supply & sew erage 86.23 51.90 86.87 46.48 5.35 -7.26 -1.27 8.54

2 HT-2(a) Industrial - 1195.45 924.47 1192.42 842.13 7.06 22.40 30.30 43.25

3 HT-2(b) Commercial 72.19 65.76 72.19 60.98 8.45 46.39 55.84 71.33

4

HT-2 ( c) (i) Govt./ Aided Hospitals & Educational

Institutions 11.95 5.12 11.95 7.55 6.32 9.55 16.62 28.22

5

HT-2 ( c) (ii) Hospitals and Educational Institutions

other than covered under HT-2( c)

(i) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

6

HT-3(a)(i) Lift Irrigation - Applicable to lif t

irrigation schemes under Govt Dept,

/ Govt. ow ned Corporations 104.51 28.43 101.83 20.37 2.00 -65.34 -63.10 -59.43

7

HT-3(a)(ii) Lift Irrigation - Applicable to Private

lif t irrigation schemes Lift Irrigaton

societies on urban/express feeders 13.14 4.76 12.80 4.03 3.15 -45.40 -41.88 -36.10

8

HT-3(a)(iii) LI schemes other than those

covered under HT 3(a)(ii) 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

9

HT - 3b Irrigation & Agriculture Farms,Govt.

Horticultural Farms, Pvt.Horticulture

Nurseries, Coffee, Tea,Cocanut &

Arecanut Plantations 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00

10 HT-4 Residential Apartments -Colonies 13.31 9.05 13.31 8.16 6.13 6.26 13.12 24.37

11 HT-5 Temporary supply 5.46 8.29 5.46 8.99 16.47 185.22 203.64 233.82

1502.25 1097.78 1496.84 998.69 6.67 15.63 23.10 35.34

6808.08 4279.41 6897.24 3849.96 5.58 -3.26 _ _

99.30 128.60

6808.08 4378.71 6897.24 3,978.56 5.77 0.00

* These categories are subsidised by GoK. In case subsidy is not released by the Gok in adv ance, GESCOM

shall raise demand & collect CDT of Rs. 5.77/unit by BJ/KJ &Rs.5.03/unit from IP set Consumers.

* Voltage w ise cost of supply per unit to: LT Rs: 5.93, HT Rs.5.42 & EHT- Rs.4.93 Page - 222

Level of

Cross

Subsidy in

% (EHT)

With ref. to voltage wise

COS*

PROPOSED AND APPROVED REVENUE AND REALISATION AND LEVEL OF CROSS SUBSIDY FOR FY-17 OF GESCOM

Annexure-III

Grand Total

LT - TOTAL

HT - TOTAL

TOTAL

Misc. Revenue

Proposed by GESCOMLevel of

Cross

Subsidy in %

(LT&HT)

Average

Realisation in

Rs. Per Kwh

Level o f

C ro ss Subsidy

in %

Approved as per RST

Sl No Category Description

ccxliii

ANNEX - IV

ELECTRICITY TARIFF - 2017

K.E.R.C. ORDER DATED: 30th March,2016

Effective for the Electricity consumed from the first meter

reading date falling on or after 01.04.2016

Gulbarga

Electricity Supply Company Ltd.,

ccxliv

ELECTRICITY TARIFF-2017

GENERAL TERMS AND CONDITIONS OF TARIFF:

(APPLICABLE TO BOTH HT AND LT)

1. Supply of power is subject to execution of agreement by the

Consumer in the prescribed form, payment of prescribed

deposits and compliance of terms and conditions as stipulated

in the Conditions of Supply of Electricity of the Distribution

Licensees in the State of Karnataka and Regulations issued

under Electricity Act 2003 at the time of supply and continuation

of power supply is subject to compliance of the said Conditions

of Supply / Regulations as amended from time to time.

2. The tariffs are applicable to only single point of supply unless

otherwise approved by the Licensee.

3. The Licensee does not bind himself to energize any installation,

unless the Consumer guarantees the minimum charges. The

minimum charge is the power supply charges in accordance

with the tariff in force from time to time. This shall be payable by

the Consumer until power supply agreement is terminated,

irrespective of the installation being in service or under

disconnection.

4. The tariffs in the schedule are applicable to power supply within

the Karnataka State.

5. The tariffs are subject to levy of Tax and Surcharges thereon as

may be decided by the State Government from time to time.

6. For the purpose of these tariffs, the following conversion table would

be used:

1 HP=0.746 KW. 1HP=0.878 KVA.

ccxlv

7. The bill amount will be rounded off to the nearest Rupee, i.e., the bill

amount of 50 Paise and above will be rounded off to the next higher

Rupee and the amount less than 50 Paise will be ignored.

8. Use of power for temporary illumination in the premises already having

permanent power supply for marriages, exhibitions in hotels, sales

promotions etc., is limited to sanctioned load at the applicable

permanent power supply tariff rates. Temporary tariff rates will be

applicable in case the load exceeds sanctioned load as per the

Conditions of Supply of Electricity of the Distribution Licensees in the

State of Karnataka.

9. No LT power supply will be given where the requisitioned load is 50

KW/67 HP and above. This condition does not apply for installations

serviced under clause 3.1.1 of K.E.R.C. (Recovery of Expenditure for

supply of Electricity) Regulations, 2004 and its amendments from time

to time. The applicant is however at liberty to avail HT supply for lesser

loads. The minimum contract demand for HT supply shall be 25 KVA or

as amended from time to time by the Licensee with the approval of

KERC.

10. The Consumer shall not resell electricity purchased from the Licensee

to a third party except –

(a) Where the Consumer holds a sanction or a tariff provision for

distribution and sale of energy,

(b) Under special contract permitting the Consumer for resale of

energy in accordance with the provisions of the contract.

11. Non-receipt of the bill by the Consumer is not a valid reason for non-

payment. The Consumer shall notify the office of issue of the bill if the

same is not received within 7 days from the meter reading date.

Otherwise, it will be deemed that the bills have reached the Consumer

in due time.

ccxlvi

12. The Licensee will levy the following charges for non-realization of each

Cheque

1 Cheque amount upto

Rs. 10,000/-

5% of the amount subject to a

minimum of Rs100/-

2 Cheque amount of

Rs. 10,001/- and upto

Rs. 1,00,000/-


minimum of Rs500/-

3 Cheque amount above

Rs. 1 Lakh:


minimum of Rs3000/-

13. In respect of power supply charges paid by the Consumer through

money order, Cheque /DD sent by post, receipt will be drawn and the

Consumer has to collect the same.

14. In case of any belated payment, simple interest at the rate of 1 % per

month will be levied on the actual No. of days of delay subject to a

minimum of Re.1/- for LT installation and Rs.100/- for HT installation. No

interest is however levied for arrears of Rs.10/- and less.

15. All LT Consumers, except BhagyaJyothi and KutirJyothi Consumers, shall

provide current limiter/Circuit Breakers of capacity prescribed by the

Licensee depending upon the sanctioned load.

16. All payments made by the Consumer will be adjusted in the following

order of priority: -

(a) Interest on arrears of Electricity Tax

(b) Arrears of Electricity Tax

(c) Arrears of Interest on Electricity charges

(d) Arrears of Electricity charges

(e) Current month’s dues

ccxlvii

17. For the purpose of billing,

(i) the higher of the rated load or sanctioned load in respect of LT

installations which are not provided with Electronic Tri-Vector

meter.

(ii) sanctioned load or MD recorded, whichever is higher, in respect

of installations provided with static meters or Electronic Tri-Vector

meter will be considered.

Penalty and other clauses shall apply if sanctioned load is exceeded.

18. The bill amount shall be paid within 15 days from the date of

presentation of the bill failing which the interest becomes payable.

19. For individual installations, more than one meter shall not be provided

under the same tariff. Wherever two or more meters are existing for

individual installation, the sum of the consumption recorded by the

meters shall be taken for billing, till they are merged.

20. In case of multiple connections in a building, all the meters shall be

provided at one easily accessible place in the ground floor.

21. Reconnection charges: The following reconnection charges shall be

levied incase of disconnection and included in the monthly bill.

For reconnection of:

a Single Phase Domestic installations

under Tariff schedule LT 1 & LT2 (a)

Rs 20/-per Installation.

b Three Phase Domestic installations

under Tariff schedule LT2 (a) and

Single Phase Commercial & Power

installations.

Rs50/-per Installation.

c All LT installations with 3 Phase supply

other than LT2 (a)

Rs. 100/-per

Installation.

d All HT& EHT installations Rs500/-per Installation.

22. Revenue payments up to and inclusive of Rs.10,000/- shall be made by

cash or cheque or D.D and payments above Rs.10,000/- shall be made

by cheque or D.D only. Payments under other heads of account shall

be made by cash or D.D up to and inclusive of Rs.10, 000/- and

payment above Rs.10, 000/-shall be by D.D only.

Note: The Consumers can avail the facility of payment of monthly power

supply bill through Electronic clearing system (ECS)/ Credit cards /

on line E-Payment @ www.billjunction.com at counters wherever

such facility is provided by the Licensee in respect of revenue

payments up to the limit prescribed by the RBI.

ccxlviii

23. For the types of installations not covered under any Tariff schedules,

the Licensee is permitted to classify such installations under

appropriate Tariff schedule under intimation to the K.E.R.C.

24. Seasonal Industries

Applicable to all Seasonal Industries.

i) The industries that intend to avail this benefit shall have Electronic Tri-

Vector Meter installed to their installations.

ii) ‘Working season’ months and ‘off-season’ months shall be

determined by an order issued by the Executive Engineer of the

concerned O&M Division of the Licensee as per the request of the

Consumer and will continue from year to year unless otherwise

altered. The Consumer shall give a clear one month’s notice in

case he intends to change his ‘ working season’.

iii) The consumption during any month of the declared off-season shall

not be more than 25% of the average consumption of the previous

working season.

iv) The ‘Working season’ months and ‘off-season’ months shall be full–

calendar months. If the power availed during a month exceeds

the allotment for the ‘off-season’ month, it shall be taken for

calculating the billing demand as if the month is the ‘working

season’ month.

v) The Consumer can avail the facility of ‘off-season’ up to six months

in a calendar year not exceeding in two spells in that year. During

the ‘off-season period, the Consumer may use power for

administrative offices etc., and for overhauling and repairing plant

and machinery.

25 Whether an institution availing Power supply can be considered as

charitable or not will be decided by the Licensee on the

production of certificate Form-12 Afrom the Income Tax

department.

ccxlix

26 Time of the Tariff (ToD)

The Commission as decides in the earlier tariff order, decide to

continue compulsory Time of Day Tariff for HT2(a) , HT2(b) and HT 2(C)

consumers with a contract demand of 500 KVA and above. Further,

the optional ToD would continue as existing earlier for HT2(a) , HT2(b)

and HT 2(C) consumers with contract demand of less than 500 KVA.

Also the ToD for HT1 consumers on optional basis would continue as

existing earlier. Details of ToD tariff are indicated under the respective

tariff category.

27. SICK INDUSTRIES:

The Government of Karnataka has extended certain reliefs for

revival/rehabilitation of sick industries under the New Industrial Policy

2001-06 vide G.O. No. CI 167 SPI 2001, dated 30.06.2001. Further, the

Government of Karnataka has issued G.O No.CI2 BIF 2010, dated

21.10.2010. The Commission, in its Tariff Order 2002, has accorded

approval for implementation of reliefs to the sick industries as per the

Government policy and the same was continued in the subsequent

Tariff Orders. In view of issue of the G.O No.CI2 BIF 2010, dated

21.10.2010, the Commission has accorded approval to ESCOMs for

implementation of the reliefs extended to sick industrial units for their

revival / rehabilitation on the basis of the orders issued by the

Commissioner for Industrial Development and Director of Industries &

Commerce, Government of Karnataka.

28. Incentive for Prompt Payment / Advance Payment: An incentive at the

rate of 0.25% of such bill shall be given to the following Consumers by

way of adjustment in the subsequent month’s bill:

(i) In all cases of payment through ECS.

ii) And in the case of monthly bills exceeding Rs.1, 00,000/- (Rs. one

lakh), if the payment is made 10 days in advance of the due date.

(iii) Advance Payment exceeding Rs.1000/- madeby the Consumers

towards monthly bills

29. Conditions of Supply of Electricity of the Distribution Licensees in the

State of Karnataka and amendments issued thereon from time to time

ccl

and Regulations issued under Electricity Act 2003 will prevail over the

extract given in this tariff book in the event of any discrepancy.

30. Self-Reading of Meters:

The Commission has approved Self-Reading of Meters by Consumers

and issue of bills by the Licensee based on such readings and the

Licensee shall take the reading at least once in six months and

reconcile the difference, if any and raise the bills accordingly. This

procedure may be implemented by the Licensee as stipulated under

Section 26.01 of Conditions of Supply of Electricity of the Distribution

Licensees in the State of Karnataka.

---0---

ELECTRICITY TARIFF—2017

PART-1

HIGH TENSION SUPPLY

Applicable to Bulk Power Supply of Voltages

at 11KV (including 2.3/4.6 KV) and above at

Standard High Voltage or Extra High Voltages

when the Contract Demand is 50 KW / 67 HP

and above.

ccli


PART-1

HIGH TENSION SUPPLY

Applicable to Bulk Power Supply at Voltages of 11KV (including

2.3/4.6 KV) and above at Standard High Voltage or Extra High

Voltages when the Contract Demand is 50 KW / 67 HP and above.

CONDITIONS APPLICABLE TO BILLING OF HT INSTALLATIONS:

1. Billing Demand

A) The billing demand during unrestricted period shall be the

maximum demand recorded during the month or 75% of the

CD, whichever is higher.

B) When the Licensee has imposed demand cut of 25% or less, the

conditions stipulated in (A) shall apply.

C) When the demand cut is in excess of 25%, the billing demand

shall be the maximum demand recorded or 75% of the

restricted demand, whichever is higher.

D) If at any time the maximum demand recorded exceeds the CD or the

demand entitlement, or opted demand entitlement during the period

of restrictions, if any, the Consumer shall pay for the quantum of excess

demand at two times the normal rate per KVA per month as deterrent

charges as per Section 126(6) of Electricity Act 2003. For over drawal

during the billing period, the penalty shall be two times the normal

rate.

E) During the periods of disconnection, the billing demand shall be

75% of CD, or 75% of the demand entitlement that would have

been applicable, had the installation been in service, whichever

is less. This provision is applicable only, if the installation is under

disconnection for the entire billing month.

cclii

F) During the period of energy cut, the Consumer may get his

demand entitlement lowered, but not below the percentage of

energy entitlement, (For example, In case the energy

entitlement is 40% and the demand entitlement is 80%, the re-

fixation of demand entitlement cannot be lower than 40% of the

CD). The benefit of lower demand entitlement will be given

effect to from the meter reading date of the same month, if the

option is exercised on or before 15th of the month. If the option is

exercised on or after 16th of the month, the benefit will be given

effect to from the next meter reading date. The Consumer shall

register such option by paying processing fee of Rs.100/- at the

Jurisdictional sub-division office.

(i) The billing demand in such cases, shall be the “Revised

(Opted) Demand Entitlement” or, the recorded demand,

whichever is higher. Such option for reduction of demand

entitlement, is allowed only once during the entire span of

that particular “Energy Cut Period”. The Consumer, can

however opt for a higher demand entitlement up to the

level permissible under the demand cut notification, and the

benefit will be given effect to from the next meter reading

date. Once the Consumer opts for enhancement of

demand, which has been reduced under Clause (F), no

further revision is permitted during that particular energy cut

period.

(ii) The opted reduced demand entitlement will automatically

cease to be effective, when the energy cut is revised. The

facility for reduction and enhancement can however be

exercised afresh by the Consumer as indicated in the

previous paras.

G) For the purpose of billing, the billing demand of 0.5 KVA and

above will be rounded off to the next higher KVA, and billing

demand of less than 0.5 KVA shall be ignored.

ccliii

2. Power factor (PF)

It shall be the responsibility of the HT Consumer to determine the

capacity of PF correction apparatus and maintain an average PF

of not less than 0.90.

(i) The specified P.F. is 0.90. If the power factor goes below 0.90

Lag, a surcharge of 3 Paise per unit consumed will be levied for

every reduction of P.F. by 0.01 below 0.90 Lag.

(ii) The power factor when computed as the ratio of KWh / KVAh

will be determined up to 3 decimals (ignoring figures in the other

decimal places), and then rounded off to the nearest second

decimal as illustrated below:

(a) 0.8949 to be rounded off to 0.89

(b) 0.8951 to be rounded off to 0.90

In respect of Electronic Tri-Vector meters, the recorded average PF

over the billing period shall be considered for billing purposes. If the

same is not available, the ratio of KWh to KVAh consumed in the billing

month shall be considered.

3. Rebate for supply at high voltage:

If the Consumer is availing power at voltage higher than 13.2 KV, he will

be entitled to a rebate as indicated below:

Supply Voltage: Rebate

A) 33/66 KV 2 Paise/unit of energy consumed

B) 110 KV 3 Paise/unit of energy consumed

C) 220 KV 5 Paise/unit of energy consumed

The above rebate will be allowed in respect of all the installations of

the above voltage class, including the existing installations, and also

for installations converted from 13.2 KV and below to 33 KV and above

and also for installations converted from 33/66 KV to 110/220 KV, from

the next meter reading date after conversion / service / date of

notification of this Tariff order, as the case may be. The above rebate is

applicable only on the normal energy consumed by the Consumer,

ccliv

including the consumption under TOD Tariff, and is not applicable on

any other energy allotted and consumed, if any, viz.,

i) Wheeled Energy.

ii) Any energy, including the special energy allotted over and above

normal entitlement.

iii) Energy drawal under special incentive scheme, if any.

The above rebate is not applicable for Railway Traction.

4. In respect of Residential Quarters/ Colonies availing Bulk power supply

by tapping the main HT supply, the energy consumed by such Colony

loads, metered at single point, shall be billed under HT-4 tariff schedule.

No reduction in demand recorded in the main HT meter will be

allowed.

5. Energy supplied may be utilized for all purposes associated with the

working of the installations, such as, Office, Stores, Canteens, Yard

Lighting, Water Supply and Advertisements within the premises.

6. Energy can also be used for construction, modification and expansion

purposes within the premises.

7. Power supply under HT-4 tariff schedule may be used for Commercial

and other purposes inside the colony, for installations such as Canteen,

Club, Shop, Auditorium etc., provided, this load is less than 10% of the

CD.

8. In respect of Residential Apartments availing HT Power supply under HT-

4 tariff schedule, the supply availed for Commercial and other

purposes like Shops, Hotels, etc., will be billed under appropriate tariff

schedule, (Only Energy charges) duly deducting such consumption in

the main HT supply bill. No reduction in the recorded demand of the

main HT meter is allowed. Common areas shall be billed at Tariff

applicable to that of the predominant Consumer category. [

9. Seasonal Industries

cclv

a. The industries, which intend to utilize seasonal industry benefit, shall

conform to the conditionalities under Para no. 25 of the General

terms and conditions of tariff (applicable to both HT & LT).

b. The industries that intend to avail this benefit, shall have Electronic

Tri-Vector Meter fitted to the installation.

c. Monthly charges during the working season shall be the demand

charges on 75% of the contract demand or the recorded maximum

demand during the month, whichever is higher, plus the energy

charges

d. Monthly charges during the off season, shall be demand charges

on the maximum demand recorded during the month, or 50% of the

CD which ever is higher plus the energy charges.

TARIFF SCHEDULE HT 1

Applicable to Water Supply, Drainage / Sewerage water treatment

plant and Sewerage Pumping installations, belonging to Karnataka

Urban Water Supply and Sewerage Board, other local bodies, State

and Central Government.

RATE SCHEDULE

Demand charges Rs.190/kVA of billing demand/month

Energy charges 450 paise/unit

TOD Tariff at the option of the Consumer Time of Day Increase + / reduction (-) in energy


22.00 Hrs to 06.00 Hrs (-)125 paise per unit

06.00 Hrs to 18.00 Hrs 0

18.00 Hrs to 22.00 Hrs + 100 paise per unit

Note: Energy supplied to residential quarters availing bulk supply by

the above category of Consumer, shall be metered separately

at a single point, and the energy consumed shall be billed at HT-

4 Tariff. No reduction in the demand recorded in the main HT

meter will be allowed.

TARIFF SCHEDULE HT-2(a)

Applicable to Industries, Factories, Workshops, Research &

Development Centres, Industrial Estates, Milk dairies, Rice Mills, Phova

cclvi

Mills, Roller Flour Mills, News Papers, Printing Press, Railway

Workshops/KSRTC Workshops/ Depots, Crematoriums, Cold Storage,

Ice & Ice-cream mfg. Units, Swimming Pools of local bodies, Water

Supply Installations of KIADB and other industries, all Defence

Establishments. Hatcheries, Poultry Farm, Museum, Floriculture, Green

House, Bio Technical Laboratory, Hybrid Seeds processing Units, Stone

Crushers, Stone cutting, Bakery Product Manufacturing Units, Mysore

Palace illumination, Film Studios, Dubbing Theatres, Processing, Printing,

Developing and Recording Theaters, Tissue Culture, Aqua Culture,

Prawn Culture, Information Technology Industries engaged in

development of Hardware & Software, Information Technology (IT)

enabled Services / Start-ups (As defined in GOI notification dated

17.04.2015)/ Animation / Gaming / Computer Graphics establishments

as certified by the IT & BT Department of GOK/GOI, Drug Mfg. Units,

Garment Mfg. Units, Tyre retreading units, Nuclear Power Projects,

Stadiums maintained by Government and local bodies, also Railway

Traction, Effluent treatment plants and Drainage water treatment

plants owned other than by the local bodies, LPG bottling plants,

petroleum pipeline projects, Piggery farms, Analytical Lab for analysis

of ore metals, Saw Mills, Toy/wood industries, Satellite communication

centers, and Mineral water processing plants / drinking water bottling

plants.

cclvii

RATE SCHEDULE

HT-2(a): Applicable to all areas of GESCOM.


Energy charges

For the first one lakh units 620 paise per unit

For the balance units 660 paise per unit

Railway Traction and Effluent Treatment Plants


Energy Charges 590 paise per unit for all the units

TARIFF SCHEDULE HT-2(b) Applicable to Commercial Complexes, Cinemas, Hotels, Boarding &

Lodging, Amusement Parks, Telephone Exchanges, Race Course, All

Clubs, T.V. Station, All India Radio, Railway Stations, Air Port, KSRTC

bus stations, All offices, Banks, Commercial Multi-storied buildings.

APMC Yards, Stadiums other than those maintained by Government and

Local Bodies, Construction power for irrigation, Power Projects and

Konkan Railway Project, Petrol / Diesel and Oil storage plants, I.T. based

medical transcription centers, Telecom, Call centers, BPO/KPO.

RATE SCHEDULE

HT-2 (b): Applicable to all areas of GESCOM

Energy charges

For the first two lakh units 785 paise per unit


Demand charges Rs.200 /kVA of billing demand/month

cclviii

TARIFF SCHEDULE HT-2(c)

RATE SCHEDULE

HT-2 (c) (i)- Applicable to Government Hospitals, Hospitals run by

Charitable Institutions, ESI hospitals, Universities and Educational

Institutions belonging to Government and Local bodies, Aided

Educational Institutions and Hostels of all Educational Institutions.


Energy charges



RATE SCHEDULE

HT-2 (c) (ii) - Applicable to Hospitals and Educational Institutions other than

those covered under HT-2 (c)(i).


Energy charges



Note: Applicable to HT-2 (a) , HT-2 (b) & HT-2(c) Tariff Schedule.

1. Energy supplied may be utilized for all purposes associated

with the working of the installation such as offices, stores,

canteens, yard lighting, water pumping and

advertisement within the premises.

2. Energy can be used for construction, modification and

expansion purposes within the premises.

TOD Tariff applicable to HT 2(a), HT2(b) and HT2(c) category.

Time of Day Increase (+) / reduction (-) in energy charges

over the normal tariff applicable


06.00 Hrs to 18.00 Hrs 0


TARIFF SCHEDULE HT-3 (a)

Applicable to Lift irrigation Schemes/ Lift irrigation societies,

RATE SCHEDULE

HT-3 (a)(i): Applicable to LI schemes under Govt. Departments/ Govt.

owned Corporations

cclix

Energy charges/ Minimum Charges 200 paise per unit subject to an

annual minimum of Rs.1120 per

HP/Annum

HT-3(a)(ii): Applicable to Private LI schemes and Lift Irrigation societies:

Connected to Urban/Express feeders

Fixed Charges Rs.40 /HP/per month of sanctioned

load


HT-3(a)(iii): Applicable to Private LI schemes and Lift Irrigation societies

other than those covered under HT-3 (a)(ii)

Fixed Charges Rs.20 /HP/per month of sanctioned

load


TARIFF SCHEDULE HT-3 (b)

HT-3 (b): Applicable to Irrigation and Agricultural Farms,

Government Horticultural Farms, Private Horticulture nurseries,

Coffee, Tea, Rubber, Coconut &Arecanut Plantations.

RATE SCHEDULE

Energy charges / Minimum Charges 400 paise per unit subject to an

annual minimum of Rs.1120/- per HP

of sanctioned load.

Note: These installations are to be billed on quarter yearly basis.

TARIFF SCHEDULE HT-4

Applicable to Residential apartments and colonies (whether situated

outside or inside the premises of the main HT Installation) availing

power supply independently or by tapping the main H.T. line. Power

supply can be used for residences, theatres, shopping facility, club,

hospital, guest house, yard/street lighting, canteen located within the

colony.

RATE SCHEDULE

Applicable to all areas

Demand charges Rs.110/- per kVA of billing demand/

month


NOTE: (1) In respect of residential colonies availing power supply by tapping

the main H.T. supply,the energy consumed by such colony loads

metered at a single point, is to be billed at the above energy

cclx

rate. No reduction in the recorded demand of the main H.T.

supply is allowed.

(2) Energy under this tariff may be used for commercial and other

purposes inside the colonies for installations such as, Canteens,

Clubs, Shops, Auditorium etc., provided, this commercial load is

less than 10% of the Contract demand. [

(3) In respect of Residential Apartments, availing HT Power supply

under HT-4 tariff schedule, the supply availed for Commercial and

other purposes like Shops, Hotels, etc., will be billed under

appropriate tariff schedule (Only Energy charges), duly deducting

such consumption in the main HT supply bill. No reduction in the

recorded demand of the main HT meter is allowed. Common

areas shall be billed at Tariff applicable to the predominant

Consumer category. TARIFF SCHEDULE HT-5

Tariff applicable to sanctioned load of 67 HP and above for

hoardings and advertisement boards and construction power for

industries excluding those category of consumers covered under

HT2(b) Tariff schedule availing power supply for construction

power for irrigation and power projects and also applicable to

power supply availed on temporary basis with the contract

demand of 67 HP and above of all categories.

HT – 5 – Temporary supply

RATE SCHEDULE

67 HP and above:

Fixed charges /

Demand Charges

Rs.220/HP/month for the entire sanction load /

contract demand


Note:

1. Temporary power supply with or without extension of distribution main shall

be arranged through a pre–paid energy meter duly observing the

provisions of Clause 12 of the Conditions of Supply of Electricity of the

Distribution Licensees in the State of Karnataka.

2. This Tariff is also applicable to touring cinemas having licence for duration

less than one year.

3. All the conditions regarding temporary power supply as stipulated in Clause

12 the Conditions of Supply of Electricity of the Distribution Licensees in the

State of Karnataka shall be complied with before service.

------

cclxi

ELECTRICITY TARIFF-2017

PART-II

LOW TENSION SUPPLY

(400 Volts Three Phase and

230Volts Single Phase Supply)

GESCOM


PART-II

LOW TENSION SUPPLY (400 Volts Three Phase and

230Volts Single Phase Supply) CONDITIONS APPLICABLE TO BILLING OF LT INSTALLATIONS:

1. In case of LT Industrial / commercial Consumers, Demand based Tariff

at the option of the Consumer, can be adopted. The Consumer is

permitted to have more connected load than the sanctioned load.

The billing demand will be the sanctioned load, or Maximum Demand

cclxii

recorded in the Tri-Vector Meter during the month, whichever is higher.

If the Maximum Demand recorded is more than the sanctioned load,

penal charges at two times the normal rate shall apply.

2. Use of power within the Consumer premises for bonafide temporary

purpose is permitted subject to the conditions that, total load of the

installation on the system does not exceed the sanctioned load.

3. Where it is intended to use power supply temporarily, for floor polishing

and such other portable equipments, in a premises having permanent

power supply, such equipments shall be provided with earth leakage

circuit breakers of adequate capacity.

4. The laboratory installations in educational institutions are allowed to

install connected machineries up to 4 times the sanctioned load. The

fixed charges shall however be on the basis of sanctioned load.

5. Besides combined lighting and heating, electricity supply under tariff

schedules LT2 (a) & LT2 (b), can be used for Fans, Televisions, Radios,

Refrigerators and other household appliances, including domestic

water pumps and air conditioners, provided, they are under single

meter connection. If a separate meter is provided for Air-conditioner

load, the Consumer shall be served with a notice to merge this load

and to have a single meter for the entire load. Till such time, the air

conditioner load will be billed under Commercial Tariff.

6. Bulk LT supply

If power supply for lighting / combined lighting & heating {LT 2(a)}, is

availed through a bulk Meter for group of houses belonging to one

Consumer, (ie, Where bulk LT supply is availed), the billing for energy

shall be done at the slab rate for energy charges matching the

consumption obtained by dividing the bulk consumption by number of

houses. In addition, fixed charges for the entire sanctioned load shall

be charged as per Tariff schedule.

7. A rebate of 25 Paise per unit will be given for the House/ School/Hostels

meant for Handicapped, Aged, Destitute and Orphans, Rehabilitation

Centres under Tariff schedule LT 2(a).

8. SOLAR REBATE: A rebate of 50 Paise per unit of electricity consumed

subject to a maximum of Rs.50/- per installation per month will be

allowed to Tariff schedule LT 2(a), if solar water heaters are installed

cclxiii

and used. Where Bulk Solar Water Heater System is installed, Solar

Water Heater rebate shall be allowed to each of the individual

installations, provided that, the capacity of Solar Water Heater in such

apartment / group housing shall be a minimum capacity of 100 Ltr. per

household.

9. A rebate of 20% on fixed charges and energy charges will be allowed

in the monthly bill in respect of public Telephone booths having

STD/ISD/ FAX facility run by handicapped people, under Tariff schedule

LT 3.

10. A rebate of 2 paise per unit will be allowed if capacitors are installed

as per Clause 23 of Conditions of Supply of Electricity of the Distribution

Licensees in the State of Karnataka in respect of all metered IP Set

Installations.

11. Power Factor (PF):

Capacitors of appropriate capacity shall be installed in accordance

with Clause 23 of Conditions of Supply of Electricity of the Distribution

Licensees in the State of Karnataka, in case of installations covered

under Tariff category LT 3, LT4, LT 5, & LT 6, where motive power is

involved.

(i) The specified P.F. is 0.85. If the PF is found to be less than 0.85 Lag,

a surcharge of 2 Paise per unit consumed will be levied for every

reduction of P.F. by 0.01 below 0.85 Lag. In respect of LT

installations, however, this is subject to a maximum surcharge of

30 Paise per unit.

(ii) The power factor when computed as the ratio of KWh/KVAh will

be determined up to 3 decimals (ignoring figures in the other

decimal places) and then rounded off to the nearest second

decimal as illustrated below:

(a) 0.8449 to be rounded off to 0.84

(b) 0.8451 to be rounded off to 0.85

(iii) In respect of Electronic Tri-Vector meters, the recorded average

PF over the billing period shall be considered for billing purposes.

cclxiv

(iv) During inspection, if the capacity of capacitors provided is found

to be less than what is stipulated in Conditions of Supply of

Electricity of the Distribution Licensees in the State of Karnataka, a

surcharge of 30 Paise/unit will be levied in the case of installations

covered under Tariff categories LT 3, LT 5, & LT 6 where motive

power is involved.

(v) In the case of installations without electronic Tri-vector meters

even after providing capacitors as recommended in Clause 23.01

and 23.03 of Conditions of Supply of Electricity of the Distribution

Licensees in the State of Karnataka, if during any periodical or

other testing / rating of the installation by the Licensee, the PF of

the installation is found to be lesser than 0.85, a surcharge

determined as above shall be levied from the billing month

following the expiry of Three months’ notice given by the

Licensee, till such time, the additional capacitors are installed and

informed to the Licensee in writing by the Consumer. This is also

applicable for LT installations provided with electronic Tri-vector

meters.

12. All new IP set applicants shall fix capacitors of adequate capacity in

accordance with Clause 23 of Conditions of Supply of Electricity of the

Distribution Licensees in the State of Karnataka before taking service. [

13. All the existing IP set Consumers shall also fix capacitors of adequate

capacity in accordance with Clause 23 of Conditions of Supply of

Electricity of the Distribution Licensees in the State of Karnataka, failing

which, PF surcharge at the rate of Rs.60/-per HP/ year shall be levied. If

the capacitors are found to be removed / not installed, a penalty at

the same rate as above (Rs. 60/-per HP / Year) shall be levied.

14. The Semi-permanent cinemas having Semi-permanent structure, with

permanent wiring and licence of not less than one year, will be billed

under commercial tariff schedule i.e., LT 3.

15. Touring cinemas having an outfit comprising cinema apparatus and

accessories, taken from place to place for exhibition of

cclxv

cinematography films, and also outdoor shooting units, will be billed

under Temporary Tariff schedule i.e., LT 7.

16. The Consumers under IP set tariff schedule, shall use the energy only for

pumping water to irrigate their own land as stated in the IP set application /

water right certificate and for bonafide agriculture use. Otherwise, such

installations shall be billed under appropriate Industrial / Commercial tariff,

based on the recorded consumption if available, or on the consumption

computed as per the Table given under Clause 42.06 of the Conditions of

Supply of Electricity of the Distribution Licensees in the State of Karnataka.

17. The water pumped for agricultural purposes may also be used by the

Consumer for his bonafide drinking purposes and for supplying water to

animals, birds, Poultry farms, Dairy farms and fish farms maintained by

the Consumer in addition to agriculture.

18. The motor of IP set installations can be used with an alternative drive

for other agricultural operations like sugar cane crusher, coffee

pulping, etc., with the approval of the Licensee. The energy used for

such operation, shall be metered separately by providing alternate

switch and charged at LT Industrial Tariff (Only Energy charges) during

the period of alternative use. However, if the energy used both for IP

Set and alternate operation is measured together by one energy

meter, the energy used for alternate drive shall be estimated by

deducting the average IP Set consumption for that month as per the IP

sample meter readings for the sub division, as certified by the sub

divisional Officer.

19. The IP Consumer is permitted to use energy for lighting the pump house

and well limited to two lighting points of 40 Watts each.

20. Billing shall be made at least once in a quarter year for all IP sets.

21. In case of welding transformers, the connected load shall be taken

as:

a) Half the maximum capacity in KVA as per the nameplate specified

under IS: 1851

OR

b) Half the maximum capacity in KVA as recorded during the rating by

the Licensee, whichever is higher.

cclxvi

22. Electricity under Tariff LT 3 / LT 5 can also be used for Lighting, Heating

and Air-conditioning, Yard-Lighting, water supply in the premises of

Commercial / Industrial Units respectively.

23. Fluorescent fittings shall be provided by the Licensee for the Streetlights

in the case of villages covered under the Licensee’s electrification

programme for initial installation.

In all other cases, the entire cost of fittings including Brackets, Clamps,

etc., and labour for replacement, additions and modifications shall be

met by the organizations making such a request. Labour charges shall

be paid at the standard rates fixed by the Licensee for each type of

fitting.

24. Lamps, fittings and replacements for defective components of fittings

shall be supplied by the concerned Village Panchayaths, Town

Panchayaths or Municipalities for replacement.

25. Fraction of KW / HP shall be rounded off to the nearest quarter KW / HP

for purpose of billing and the minimum billing being for 1 KW / 1HP in

respect of all categories of LT installations including I.P. sets. In the case

of street lighting installations, fraction of KW shall be rounded off to

nearest quarter KW for the purpose of billing and the minimum billing

shall be quarter KW.

26. Seasonal Industries.

a) The industries who intend to utilize seasonal industry benefit, shall

comply with the conditionalities under Para no. 25 of the General

terms and conditions of tariff (applicable to both HT & LT).

b) The industries that intend to avail this benefit, shall have Electronic

Tri-Vector Meter fitted to their installation.

c) Monthly charges during the seasonal months shall be fixed charges

and energy charges. The monthly charges during the off seasonal

months, shall be the energy charges plus 50% of the fixed charges.

TARIFF SCHEDULE LT-1

LT-1: Applicable to installations serviced under Bhagya jyothi and

Kutira jyothi (BJ/KJ) schemes.

RATE SCHEDULE

Energy charges Nil*

cclxvii

(including recovery towards

service main charges)

Fully subsidized by the GOK

Commission Determined Tariff for the above category i.e., LT-1 is Rs. 5.77 per unit.

*Since GOK is meeting the full cost of supply to BJ / KJ, the Tariff payable

by these Consumers is shown as Nil. However, if the GOK does not release

the subsidy in advance, a Tariff of Rs.5.77 per unit subject to monthly

minimum of Rs. 30/- per Installation per month shall be demanded and

collected from these Consumers.

Note: If the consumption exceeds 18 units per month or any BJ/KJ installation

is found to have more than one out let, it shall be billed as per Tariff

Schedule LT 2(a).

TARIFF SCHEDULE LT-2(a)

Applicable to lighting/combined lighting, heating and motive Power

installations of residential houses and also to such houses where a

portion is used by the occupant for (a) Handloom weaving (b) Silk

rearing and reeling and artisans using motors up to 200 watts (c)

Consultancy in (i) Engineering (ii) Architecture (iii) Medicine (iv)

Astrology (v) Legal matters (vi) Income tax (vii) Chartered Accountants

(d) Job typing (e) Tailoring (f) Post Office (g) Gold smithy (h)

Chawki rearing (i) Paying guests/Home stay guests (j) personal

Computers (k) Dhobis (l) Hand operated printing press (m) Beauty

Parlours (n) Water Supply installations, Lift which is independently

serviced for bonafide use of residential complexes/residence, (o) Farm

Houses and yard lighting limiting to 120 Watts, (p) Fodder Choppers &

Milking Machines with a connected load up to 1 HP.

Also applicable to the installations of (i) Hospitals, Dispensaries, Health

Centers run by State/Central Govt. and local bodies. (ii) Houses,

schools and Hostels meant for handicapped, aged destitute and

orphans (iii) Rehabilitation Centres run by charitable institutions, AIDS

and drug addicts Rehabilitation Centres (iv) Railway staff Quarters with

single meter(v) fire service stations.

It is also applicable to the installations of (a) Temples, Mosques,

Churches, Gurudwaras, Ashrams, Mutts and religious/Charitable

institutions (b) Hospitals, Dispensaries and Health Centres run by

Charitable institutions including X-ray units (c) Jails and Prisons (d)

Schools, Colleges, Educational institutions run by State/Central

cclxviii

Govt.,/Local Bodies (e) Seminaries (f) Hostels run by the Government,

Educational Institutions, Cultural, Scientific and Charitable Institutions

(g) Guest Houses/Travelers Bungalows run in Government buildings or

by State/Central Govt./Religious/Charitable institutions (h) Public

libraries (i) Silk rearing (j) Museums (k) Installations of Historical

Monuments of Archeology Departments(l) Public Telephone Booths

without STD/ISD/FAX facility run by handicapped people (m) Sulabh /

Nirmal Souchalayas (n) Viswa Sheds having Lighting Loads only.

RATE SCHEDULE

LT 2 (a) (i): Applicable to areas coming under City Municipal Corporations

and all other Urban Local Bodies

Fixed charges per month For the first KW Rs.30/- per KW

For every additional KW Rs.40/- per KW

Energy charges

For 0 - 30 units (Lifeline

consumption)

300 paise /unit

31 to 100 units 440 paise /unit


Above 200 units 690 paise /unit

LT-2(a)(ii): Applicable to Areas under Village Panchayats

Fixed charges per month For the first KW Rs.20/- per KW

For every additional KW Rs.30/- per KW

Energy charges

For 0 - 30 units (Lifeline

consumption)

290 paise /unit




TARIFF SCHEDULE LT-2(b)

Applicable to the installations of Private Professional and other

Private Educational Institutions including aided, unaided

institutions, Nursing Homes and Private Hospitals having only

lighting or combined lighting & heating, and motive power. [[[[[

RATE SCHEDULE

LT 2 (b) (i): Applicable to City Municipal Corporations and all other Urban

Local Bodies

Fixed charges Rs.45 Per KW subject to a minimum of Rs.75 per

month

Energy charges



cclxix

LT-2(b)(ii): Applicable in Areas under Village Panchayats

Fixed charges Rs.35 Per KW subject to a minimum of Rs.60 per

month

Energy charges



Note: Applicable to LT-2 (a), LT-2 (b) Tariff Schedules.

1 A rebate of 25 paise Per unit shall be given for installation of a house/

School/ Hostels meant for Handicapped, Aged, Destitute and Orphans,

Rehabilitation Centres run by Charitable Institutions.

2 (a) Use of power within the consumer’s premises for temporary purposes

for bonafide use is permitted subject to the condition that, the total

load of the installation on the system does not exceed the

sanctioned load.

(b) Where it is intended to use floor polishing and such other portable

equipment temporarily, in the premises having permanent supply,

such equipment shall be provided with an earth leakage circuit

breaker of adequate capacity.

3 The laboratory installations in educational institutions are allowed to

install connected machinery up to 4 times the sanctioned load. The

fixed charges shall however be on the basis of sanctioned load.

4. Besides lighting and heating, electricity supply under this schedule can

be used for fans, Televisions, Radios, Refrigerators and other house-hold

appliances including domestic water pump and air conditioners,

provided, they are under single meter connection. If a separate meter

is provided for Air conditioner Load, the consumption shall be under

commercial tariff till it is merged with the main meter.

5. SOLAR REBATE: A rebate of 50 Paise per unit of electricity consumed to

a maximum of Rs.50/- per installation per month will be allowed to Tariff

schedule LT 2(a), if solar water heaters are installed and used. Where

Bulk Solar Water Heater System is installed, Solar Water Heater rebate

shall be allowed to each of the individual installations, provided that,

the capacity of Solar Water Heater in such apartment / group housing

shall be a minimum capacity of 100 Ltr, per household.

cclxx


Applicable to Commercial Lighting, Heating and Motive Power

installations of Clinics, Diagnostic Centers, X Ray units, Shops, Stores,

Hotels/Restaurants/Boarding and Lodging Homes, Bars, Private guest

Houses, Mess, Clubs, Kalyan Mantaps / Choultry, permanent Cinemas/

Semi Permanent Cinemas, Theatres, Petrol Bunks, Petrol, Diesel and oil

Storage Plants, Service Stations/ Garages, Banks, Telephone

Exchanges. T.V.Stations, Microwave Stations, All India Radio, Dish

Antenna, Public Telephone Booths/ STD, ISD, FAX Communication

Centers, Stud Farms, Race Course, Ice Cream Parlours, Computer

Centres, Photo Studio / colour Laboratory, Xerox Copiers, Railway

Installation excepting Railway workshop, KSRTC Bus Stations excepting

Workshop, All offices, Police Stations, Commercial Complexes, Lifts of

Commercial Complexes, Battery Charging units, Tyre Vulcanizing

Centres, Post Offices, Bakery shops, Beauty Parlours, Stadiums other

than those maintained by Govt. and Local Bodies. It is also applicable

to water supply pumps and street lights not covered under LT 6, Cyber

cafés, Internet surfing cafés, Call centers, I.T. based medical

transcription centers, Private Hostels not covered under LT -2 (a),

Paying guests accommodation provided in an independent /

exclusive premises.

RATE SCHEDULE

LT-3 (i): Applicable to City Municipal Corporations and all other urban local

bodies

Fixed charges Rs.50 per KW per month

Energy charges

For 0 - 50 units 715 paise /unit


Demand based tariff (optional) where sanctioned load

is above 5 KW but below 50 KW


Energy charges As above

RATE SCHEDULE

LT-3 (ii): Applicable in Areas under Village Panchayats


Energy charges For 0 - 50 units 665 paise /unit


cclxxi

Demand based tariff (optional) where sanctioned load

is above 5 KW but below 50 KW


Energy charges As above

Note: 1. Besides Lighting, Heating and Motive power, Electricity supply under

this Tariff can also be used for Yard lighting/ air Conditioning/water

supply in the premises.

2. The semi permanent Cinemas should have semi Permanent Structure

with permanent wiring and licence for a duration of not less than

one year.

3. Touring Cinemas having an outfit comprising Cinema apparatus

and accessories taken from place to place for exhibition of

cinematography film and also outdoor shooting units shall be billed

under LT- 7 Tariff.

4. A rebate of 20% on fixed charges and energy charges shall be

allowed in the monthly bill in respect of telephone Booths having

STD / ISD/FAX facility run by handicapped people.

5.Demand based Tariff at the option of the Consumer can be

adopted as per Para 1 of the conditions applicable to LT

installations.

TARIFF SCHEDULE LT-4 (a), LT-4 (b) & LT-4(c)

Applicable to (a) Agricultural Pump Sets including Sprinklers (b) Pump

sets used in (i) Nurseries of forest and Horticultural Departments (ii)

Grass Farms and Gardens (iii) Plantations other than Coffee, Tea,

Rubber and Private Horticulture Nurseries

cclxxii

TARIFF SCHEDULE LT-4 (a)

Applicable to I.P. Sets Up to and inclusive of 10 HP

RATE SCHEDULE

Fixed charges Free

Energy charges

Commission Determined Tariff (CDT) for LT4 (a) category is 503 Paise per

unit. In case the GOK does not release the subsidy in advance in the

manner specified by the Commission in K.E.R.C. (Manner of Payment of

subsidy) Regulations, 2008, CDT of 503 paise per unit shall be demanded

and collected from these Consumers.

Note: This Tariff is applicable for Coconut and Areca nut plantations

also.

TARIFF SCHEDULE LT-4 (b):

Applicable to IP sets above 10 HP

RATE SCHEDULE

Fixed charges Rs.40 per HP per month.

Energy charges 280 paise per unit

TARIFF SCHEDULE LT-4 (c) (i):

Applicable to Private Horticultural Nurseries, Coffee, Tea and Rubber

plantations of sanctioned load up to and inclusive of 10 HP.

RATE SCHEDULE



TARIFF SCHEDULE LT-4 (c)(ii):

Applicable to Private Horticultural Nurseries, Coffee , Tea and Rubber

plantations of sanctioned load above 10 HP.

RATE SCHEDULE



Note: 1) The energy supplied under this tariff shall be used by the consumers only for

pumping water to irrigate their own land as stated in the I.P. Set application /

water right certificate and for bonafide agriculture use. Otherwise, such

installations shall be billed under the appropriate Tariff (LT-3/ LT-5) based on the

recorded consumption if available, or on the consumption computed as per the

Table given under Clause 42.06 of the Conditions of Supply of Electricity of the


cclxxiii

2) The motor of IP set installations can be used with an alternative drive for other

agricultural operations like sugar cane crusher, coffee pulping, etc., with the

approval of the Licensee. The energy used for such operation shall be metered

separately by providing alternate switch and charged at LT Industrial Tariff (Only

Energy charges) during the period of alternative use. If the energy used both for

IP Set and alternate operation, is however measured together by one energy

meter, the energy used for alternate drive shall be estimated by deducting the

average IP Set consumption for that month as per the IP sample meter readings

for the sub division as certified by the sub divisional Officer.

3) The Consumer is permitted to use the energy for lighting the pump house and

well limited to 2 lighting points of 40 W each.

4) The water pumped for agricultural purposes may also be used by the Consumer

for his bonafide drinking purposes and for supplying water to animals, birds,

Poultry farms, Dairy farms and fish farms maintained by the Consumer in addition

to agriculture.

5) Billing shall be made at least once in a quarter year for all IP sets. 6) A rebate of 2 paise per unit will be allowed if capacitors are installed as per Clause

23 of Conditions of Supply of Electricity of the Distribution Licensees in the State

of Karnataka in respect of all metered IP Set Installations.

7) Only fixed charges as in Tariff Schedule for Metered IP Set Installations shall be

collected during the disconnection period of IP Sets under LT 4(a), LT 4(b) and

LT 4(c) categories irrespective of whether the IP Sets are provided with Meters or

not.


Applicable to Heating & Motive power (including lighting) installations

of industrial Units, Workshops, Poultry Farms, Sugarcane Crushers,

Coffee Pulping, Cardamom drying, Mushroom raising installations,

Flour, Huller & Rice Mills, Wet Grinders, Milk dairies, Ironing , Dry Cleaners

and Laundries having washing, Drying, Ironing etc., exclusive Tailoring

Shops, Bulk Ice Cream and Ice manufacturing Units, Coffee Roasting

and Grinding Works, Cold Storage Plants, Bakery Product Mfg. Units,

KSRTC workshops/Depots, Railway workshops, Drug manufacturing units

and Testing laboratories, Printing Presses, Garment manufacturing units,

cclxxiv

Bulk Milk vending Booths, Swimming Pools of local Bodies, Tyre

retreading units, Stone crushers, Stone cutting, Chilly Grinders, Phova

Mills, pulverizing Mills, Decorticators, Iron & Red-Oxide crushing units,

crematoriums, hatcheries, Tissue culture, Saw Mills, Toy/wood industries,

Viswa Sheds with mixed load sanctioned under Viswa Scheme,

Cinematic activities such as Processing, Printing, Developing,

Recording theatres, Dubbing Theatres and film studios, Agarbathi

manufacturing unit., Water supply installations of KIADB & industrial

units, Gem & Diamond cutting Units, Floriculture, Green House, Biotech

Labs., Hybrid seed processing units. Information Technology industries

engaged in development of hardware & Software, Information

Technology (IT) enabled Services / Start-ups (As defined in GOI

notification dated 17.04.2015)/ Animation / Gaming / Computer

Graphics establishments as certified by the IT & BT Department of

GOK/GOI, Silk filature units, Aqua Culture, Prawn Culture, Brick

manufacturing units, Silk / Cotton colour dying, Stadiums maintained

by Govt. and local bodies, Fire service stations, Gold / Silver ornament

manufacturing units, Effluent treatment plants, Drainage water

treatment plants, LPG bottling plants and petroleum pipeline projects,

Piggery farms, Analytical Lab. for analysis of ore metals, Satellite

communication centers, Mineral water processing plants / drinking

water bottling plants and soda fountain units.

Tariff for LT 5 :

Tariff for LT 5 (a):

Applicable to areas under Municipal Corporations

i) Fixed charges


Fixed

Charges per

Month

i) Rs.30 per HP for 5 HP & below

ii) Rs.35 per HP for above 5 HP & below 40 HP

iii) Rs.40 per HP for 40 HP & above but below 67 HP

iv) Rs.100 per HP for 67 HP & above

Demand based Tariff (optional)

cclxxv

Fixed

Charges per

Month


HP


demand


than 67 HP


demand

67 HP and above Rs.150 per KW of billing

demand

ii) Energy Charges


For the first 500 units 495 paise/unit



Tariff for LT 5 (b):

Applicable to all areas other than those covered under LT-5(a)

i. Fixed charges

i. Fixed charges

Fixed Charges

per Month

i) Rs.30 per HP for 5 HP & below

ii) Rs.35 per HP for above 5 HP & below 40 HP

iii) Rs.40 per HP for 40 HP & above but below 67 HP

iv)Rs.100 per HP for 67 HP & above

ii. Demand based Tariff (optional)

Fixed

Charges

per Month

Above 5 HP and less than 40 HP Rs.50 per KW of billing demand

40 HP and above but less than

67 HP

Rs.65 per KW of billing demand

67 HP and above Rs.150 per KW of billing demand

iii. Energy Charges




TOD Tariff applicable to LT-5:At the option of the Consumer

Time of Day Increase (+) / reduction (-) in energy



06.00 Hrs to 18.00 Hrs 0


NOTE:

1. DEMAND BASED TARIFF

In the case of LT Industrial Consumers, Demand based Tariff at the

option of the Consumer can be adopted. The Consumer is permitted

to have more connected load than the sanctioned load. The billing

demand will be the sanctioned load or Maximum Demand recorded in

cclxxvi

the Tri-Vector Meter during the month whichever is higher. If the

Maximum Demand recorded is more than the sanctioned load, penal

charges at two times the normal rate shall apply.

2. Seasonal Industries: The industries which intend to utilize seasonal

industry benefit shall comply with the conditionalities under para no. 26

of general terms and conditions applicable to LT.

3. Electricity can also be used for lighting, heating, and air-conditioning in

the premises.

4. In the case of welding transformers, the connected load shall be taken

as (a) Half the maximum capacity in KVA as per the name plate

specified under-IS1851 or (b) Half the maximum capacity in KVA as

recorded during rating by the Licensee, whichever is higher.


Applicable to water supply and sewerage pumping installations and

also applicable to applicable to water purifying plants maintained by

Government and Urban Local Bodies/ Grama Panchayats for supplying

pure drinking water to residential areas,, Public Street lights/Park lights

of village Panchayat, Town Panchayat, Town Municipalities, City

Municipalities / Corporations / State and Central Govt. / APMC, Traffic

signals, Surveillance Cameras at traffic locations belonging to

Government Department, subways, water fountains of local bodies.

Also applicable to Streetlights of residential Campus of universities,

other educational institutions, housing colonies approved by local

bodies/development authority, religious institutions, organizations run

on charitable basis, industrial area / estate and notified areas,also

Applicable to water supply installations in residential Layouts, Street

lights along with signal lights and associated load of the gateman hut

provided at the Railway level crossing.

RATE SCHEDULE

Water Supply- LT-6 (a)

Fixed charges Rs.45/HP/month

Energy charges 390 paise /unit

Public lighting- LT-6 (b)

Fixed charges Rs.60/KW/month

cclxxvii

Energy charges 550 paise /unit

Energy Charges for LED/ Induction

Lighting

450 paise/unit

TARIFF SCHEDULE LT-7 Temporary Supply and Permanent Supply to Advertising Hoardings

TARIFF SCHEDULE LT-7(a)

Applicable to Temporary Power Supply for all purposes.

LT 7(a) Details Approved Tariff

Temporary Power

Supply for all

purposes.

Less than 67 HP:

Energy charges at 950 paise / unit

subject to a weekly minimum of Rs.170

per KW of the sanctioned load.

TARIFF SCHEDULE LT-7(b)

Applicable to Hoardings & Advertisement boards, Bus Shelters with

Advertising Boards, Private Advertising Posts / Sign boards in the

interest of public such as Police Canopy Direction boards, and other

sign boards sponsored by Private Advertising Agencies / firms on

permanent connection basis.

LT 7(b) Details Approved Tariff

Power supply on

permanent

connection basis

Less than 67 HP:

Fixed Charges at Rs.50

per KW / month and

Energy charges at 950

paise / unit

Note:

1. Temporary power supply with or without extension of distribution main

shall be arranged through a pre–paid energy meter duly observing the

provisions of Clause 12 of the Conditions of Supply of Electricity of the


2. This Tariff is also applicable to touring cinemas having licence for

duration less than one year.

3. All the conditions regarding temporary power supply as stipulated in

Clause 12 of the Conditions of Supply of Electricity of the Distribution

Licensees in the State of Karnataka shall be complied with before

service.

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