Proposed revision of power tariff may be short-lived

Escoms Multi Year Tariff validity ends on March 31, 2010

As the Karnataka Electricity Regulatory Commission (KERC) gears up to hear the tariff revision proposal by the ESCOMs, the consumers find it a futile exercise, as the MYT validity of three years will cease on March 31, 2010.
Following a MYT application for three years by the companies, the KERC in 2006 ordered for new tariff revision. But the companies appealed against it before the appellate tribunal and the matter is yet to be resolved. Meanwhile, another application seeking a tariff revision is all set to be heard by the KERC in October 2009.

As per the procedure, the companies have to call for objections for 30 days, and the KERC will conduct the hearing based on these objections. Accordingly, the last date for filing objections will be September 15 - excluding all the public holidays.
“This entire process is a futile exercise because the order of KERC will be valid only for four or five months. The Escoms should instead go for another MYT,” said Satyanarayana Udupa, Chairman, Bharatiya Kissan Sangh. “It neither benefits the power company nor the consumers,” he added.

Sridhar Prabhu, a power expert and an advocate, agrees that it will just be a burden on consumers, “The matter is still before the tribunal. If it was disposed, the three-year MYT would be in effect only till March 31. The Escoms have to prepare for a new application from November 2009,  so that it can be implemented  immediately after the first MYT ends,” he said.
Power sector sources say they are aware of the legal hurdles that have arisen following the tariff revision. But a source in the sector says, “The hearing is for the public to oppose. We will abide by the outcome of the hearing.”

On the MYT, the companies differ. Sources in the Bescom say that the decision to file for MYT is not yet taken. But the other companies say that it is a regulatory process and should be filed by November. 

Don’t hike yet: FKCCI
The Federation of Karnataka Chambers of Commerce and Industry (FKCCI) has written to Chief Minister B S Yedyurappa, requesting him to put on hold the proposed revision in tariff, considering the severe drought situation in the State.

FKCCI Chairman Joseph Crasta, in a letter to the Chief Minister, has said that the notification issued by the State in August 2009 on a hike of around 14 to 20 percent would hit the industries and the agro sector.

The matter will also be raised before the Karnataka Electricity Regulatory Commission (KERC), to put off the proposal. The Escoms have sought a revision of power tariff by 50 paise on all the categories.