In the Multi-Year Transmission Tariff order, KERC has fixed the transmission charges at Rs 17.48 paise per unit for 2007-08, Rs 14.80 paise per unit for 2008-09 and Rs 14.12 paise per unit for 2009-10 as against Rs 19.42 paise per unit being charged at present.

KPTCL had sought Rs 32.64 paise, Rs 33.54 paise and Rs 40.19 paise per unit respectively for these years.
The new order has come into force from July 1 this year.

Releasing the order to the media, KERC Chairman K P Pandey said tariff had been fixed based on demand this year. Earlier, it was based on energy consumed.

Mr Pandey said KPTCL had sought approval for Annual Revenue Requirement (ARR) as follows: For 2007-08 - Rs 1351.63 crore; 2008-09 - Rs 1,511 crore; and 2009-10 - Rs 1979.74 crore.

After examining, KERC fixed the ARR as follows: 2007-08 - Rs 733.73 crore; 2008-09 - Rs 666.96 crore; and 2009-10 - Rs 695.52 crore.

Mr Pandey said ARR is subject to variation depending on the capital expenditure KPTCL will incur for taking up system improvement programmes. If these investments are found to be genuine and fruitful, consumers will be charged to that extent.

He said KERC order has not taken the capital expenditure into consideration because it was bound by the order of Appellate Tribunal on Electricity (ATE) passed on an appeal by KPTCL against the previous tariff order. In the said order, ATE had directed KERC to take the capital expenditure into account only after the investment is made by KPTCL.

KPTCL has proposed to invest the following amounts for system improvement works: 2007-08 - Rs 2,400 crore, 2008-09: Rs 2,100 crore; 2009-10 - Rs 1,600 crore.

On claims by Tannir Bhavi project, Mr Pandey said ATE had directed KERC to allow the difference of fixed charge claims in full. It also directed KERC to pass on the same to consumers by amortising it over five years or lesser period through creation of a ‘Regulatory Asset’ by KPTCL.

On power purchase costs incurred by KPTCL/Escoms for the period 2002 to 2006, Mr Pandey said KERC has found the actual cost incurred (Rs 28,300 crore) is less than the amount allowed by KERC (Rs 28,622 crore). “Since the power purchase cost already exceeds the actual cost, KERC has not accepted the plea of KPTCL to pass on costs to consumers again,” he added.