Visakhapatnam: If the government does not bail out the electricity transmission services of Andhra Pradesh, electricity tariffs in 2017 could increase.
Eastern Power Distribution Company Limited (EPDCL) and Southern Power Distribution Company Limited (SPDCL) recently submitted to the AP Electricity Regulatory Commission (ERC) their annual revenue requirements for 2017-18. They presented a projected loss of abo-ut Rs 7177 crore.
While the annual revenue requirement is around Rs 10,481 crore, the EPDCL projected total revenues from current tariffs as Rs 8,894 crore, a revenue deficit of Rs 1,587 crore. The SPDCL revenue deficit is Rs 5,590 crore for 2017-18 FY.
According to an EPDCL official, they supply electricity to households at very low rates, which could be attributed to losses. “With the lowest loss of transmission and distribution among all the country’s discoms, we have lowered the annual losses to a minimum compared to what they were a few years ago,” added the official.
The SPDCL reported in their report that the average cost of supply per unit was Rs 5.96, while the average revenue achievement was Rs 4.26 per unit. This leaves an income gap of Rs 1.7 per unit. It was near Rs 0.89 per unit in the EPDCL region.
In their report, the two discoms asked the IRC to give them time to submit tariff proposals. But on the positive side, the EPDCL and the SPDCL have an energy surplus of about 10 930 million units for 2017-18.
By 2015, projected discoms combined losses of about Rs 5,174 crore for 2016-17 fiscal year. Instead of launching a direct price increase, discoms have opted for consolidating consumers according to their energy consumption in order to boost their revenues in 2016.
But the ERC limited the price increases of both discoms to Rs 216 crore for 2016-17, including Rs 42 crore for the EPDCL. This year, discoms should submit tariff proposals by December. Subsequently, the IRC will conduct state-wide public hearings on the proposals.