Bihar Tariff 2012-13

BIHAR ELECTRICITY REGULATORY COMMISSION
Case No. TP 02 of 2011 Order On: Truing-up for FY 2010-11, Review for FY 2011-12 & Determination of Aggregate Revenue Requirement (ARR) And Tariff for FY 2012-13 For Supply of Electricity to consumers in the state by Bihar State Electricity Board (BSEB) Effective from 1st April 2012 (Issued on 30th March 2012)
Bihar Electricity Regulatory Commission
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Contents
ORDER ............................................................................................................................................................ 1 1 Introduction ........................................................................................................................................... 8 1.1 1.2 1.3 1.4 1.5 2 Bihar Electricity Regulatory Commission ........................................................................................... 8 Functions of BERC........................................................................................................................... 8 Bihar State Electricity Board ............................................................................................................. 9 Chronology of the filing of tariff petitions and Issue of Tariff Orders .................................................. 10 Scope of the Order ......................................................................................................................... 11
Procedural History ............................................................................................................................... 13 2.1 2.2 2.3 2.4 2.5 2.6 Background ................................................................................................................................... 13 Information Gaps in the petition ...................................................................................................... 13 Inviting comments / suggestions from Public ................................................................................... 14 State Advisory Committee .............................................................................................................. 19 Public Hearing ............................................................................................................................... 19 Structure of the Order..................................................................................................................... 20
Public Consultation Process ............................................................................................................... 22 3.1 3.2 Introduction .................................................................................................................................... 22 Stakeholders Suggestions/ Objections, BSEBs Response and Commissions Views ....................... 22
True Up of FY 2010-11 ......................................................................................................................... 64 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 4.9 4.10 4.11 4.12 4.13 4.14 4.15 4.16 4.17 4.18 4.19 4.20 4.21 4.22 4.23 Background ................................................................................................................................... 64 True-up of ARR for FY 2010-11 ...................................................................................................... 64 Category wise energy sales ............................................................................................................ 65 Transmission and Distribution Losses ............................................................................................. 67 Own Generation ............................................................................................................................. 68 Power Purchase............................................................................................................................. 69 Energy Balance.............................................................................................................................. 71 Own Generation Cost ..................................................................................................................... 73 Power Purchase Cost..................................................................................................................... 76 Disincentive for non-achievement of T&D loss reduction Targets ..................................................... 78 Operation & Maintenance Expenses ............................................................................................... 79 Capital Expenditure ........................................................................................................................ 83 Gross Fixed Assets ........................................................................................................................ 85 Depreciation .................................................................................................................................. 86 Interest and Finance Charges ......................................................................................................... 87 Interest on Working Capital............................................................................................................. 92 Return on Equity (ROE).................................................................................................................. 94 Taxes ...................................................................................................................................... 95 Other Debits & Extraordinary Items ................................................................................................. 95 Prior Period Credits / (Charges) ...................................................................................................... 95 Non-Tariff Income .......................................................................................................................... 97 Revenue from the sale of Power ................................................................................................... 100 Grant / Revenue Subsidy from State Government ......................................................................... 103
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4.24 5
Approved ARR and Revenue Gap for FY 2010-11......................................................................... 106
Review of FY 2011-12......................................................................................................................... 109 5.1 5.2 5.3 5.4 5.5 5.6 5.7 Background ................................................................................................................................. 109 Category wise Sales..................................................................................................................... 109 Transmission and Distribution Losses ........................................................................................... 111 BSEBs Own generation ............................................................................................................... 112 Power Purchase........................................................................................................................... 116 Energy Balance............................................................................................................................ 118 Operation & Maintenance Expenses (O&M) .................................................................................. 120
Employee Expenses ................................................................................................................................. 120 Repair & Maintenance Expenses (R&M) ................................................................................................... 123 Administration & General Expenses (A&G)................................................................................................ 124 Operation & Maintenance Expenses (O&M) .............................................................................................. 126 5.8 5.9 5.10 5.11 5.12 5.13 5.14 5.15 5.16 5.17 5.18 5.19 6 Capital Expenditure ...................................................................................................................... 126 Depreciation ................................................................................................................................ 130 Interest & Finance Charges .......................................................................................................... 132 Interest on Working Capital........................................................................................................... 135 Non-Tariff Income ........................................................................................................................ 137 Return on Equity .......................................................................................................................... 140 Revenue from Sale of Power at Existing Tariff for FY 2011-12 ....................................................... 141 Revenue from sale to Nepal & UI.................................................................................................. 142 Revenue from sale of Additional Power ......................................................................................... 143 Disincentive for non-achievement of T&D loss reduction Targets ................................................... 143 Resource gap funding received from State Government for FY 2011-12 ........................................ 144 Aggregate Revenue Requirement of BSEB for FY 2011-12 ........................................................... 145
Analysis of Aggregate Revenue Requirement for FY 2012-13 .......................................................... 147 6.1 6.2 6.3 6.4 6.5 6.6 6.7 6.8 6.9 6.10 6.11 6.12 6.13 6.14 6.15 6.16 6.17 6.18 6.19 Background ................................................................................................................................. 147 Energy Sales ............................................................................................................................... 147 Consumption by Un-metered Categories ....................................................................................... 151 Kutir Jyoti (Rural and Urban) ........................................................................................................ 151 Domestic - I (Rural) (DS-I) ............................................................................................................ 155 Domestic Metered (Urban) - DS-II................................................................................................. 156 Domestic - DS-III.......................................................................................................................... 157 Non-Domestic-I Rural (NDS-I).................................................................................................... 157 Non-Domestic-II Urban (NDS-II) ................................................................................................ 158 Non-Domestic III (Religious Places) NDS-III ................................................................................ 159 Industrial LTIS-I & II...................................................................................................................... 159 Street Lighting (Public Lighting) SS-I, SS-II ................................................................................... 160 Irrigation and Agriculture Service (IAS-I & II) ................................................................................. 161 Public Water Works ...................................................................................................................... 162 HT Industry (HTS-I, HTS-II, HTS-III and HTSS) ............................................................................. 163 Railway Traction .......................................................................................................................... 164 Energy sales to Nepal (NEA) ........................................................................................................ 165 Total Energy Sales, No. of Consumers & Connected Load ............................................................ 165 Transmission & Distribution Losses (T&D Losses)......................................................................... 168
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6.20 6.21 6.22 6.23
BSEBs Own generation ............................................................................................................... 175 Power Purchase........................................................................................................................... 180 Energy Balance............................................................................................................................ 187 Operation & Maintenance Expenses (O&M) .................................................................................. 189
Employee Expenses ................................................................................................................................. 189 Repair & Maintenance Expenses (R&M) ................................................................................................... 193 Administration & General Expenses (A&G)................................................................................................ 195 Total Operation & Maintenance Cost......................................................................................................... 196 6.24 6.25 6.26 6.27 6.28 6.29 6.30 6.31 6.32 6.33 6.34 6.35 6.36 6.37 6.38 7 Capital Expenditure ...................................................................................................................... 196 Depreciation ................................................................................................................................ 201 Interest & Finance Charges .......................................................................................................... 203 Interest on Working Capital........................................................................................................... 206 Non-Tariff Income ........................................................................................................................ 207 Return on Equity .......................................................................................................................... 211 Revenue from Sale of Power at Existing Tariff for FY 2012-13 ....................................................... 211 Revenue from sale to Nepal & UI.................................................................................................. 214 Revenue from sale of Additional Power ......................................................................................... 215 Resource gap funding for meeting cost of additional power purchase............................................. 216 Past Recoveries ........................................................................................................................... 217 Aggregate Revenue Requirement of BSEB for FY 2012-13 ........................................................... 218 Revenue at Approved Tariff .......................................................................................................... 219 Revenue Gap at Approved Tariff................................................................................................... 220 Average Tariff as percentage of Average Cost in Tariff Order for FY 2011-12 & FY 2012-13........... 222
Government grant/ revenue subsidy ................................................................................................. 224 7.1 Background ................................................................................................................................. 224
7.2 BSEB proposal and BERC approach toward Grant/ Revenue Subsidy from State Government in tariff petition .................................................................................................................................... 224 7.3 Clarification on the treatment of State Government Grant/ Revenue Subsidy.................................. 224 7.4 BSEB proposal and BERC approach toward Grant/ Revenue Subsidy from State Government in trueup process .................................................................................................................................... 225 7.5 Treatment of Grant/ Revenue Subsidy from State Government from FY 2012-13 onwards.............. 226 7.6 Mechanism for determination and recovery of Government subsidy support to Agriculture/ Rural consumers .................................................................................................................................... 227 8 Tariff Principles, Design and Tariff Schedule.................................................................................... 229 8.1 8.2 8.3 8.4 Background ................................................................................................................................. 229 Tariff changes proposed by BSEB ................................................................................................ 230 Changes in existing tariff categories/sub-categories proposed by BSEB......................................... 231 Changes in tariff category and tariff schedule approved by the Commission ................................... 236
8.5 Category/Sub-category wise changes proposed by BSEB and approved by the Commission are discussed in respective sections. .............................................................................................................. 251 8.6 Approved tariff categories for FY2012-2013 .................................................................................. 255 8.7 TARIFF SCHEDULE FOR RETAIL TARIFF RATES AND TERMS AND CONDITIONS OF SUPPLY FOR FY 2012-13 .................................................................................................................................... 259 9 Status of Directives issued by the Commission ............................................................................... 296 9.1 9.2 General .................................................................................................................................... 296
Directives issued in Tariff Order of FY 2012-13: Fresh Directives ................................................... 297
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9.3 9.4 9.5 9.6 10
Directives issued in Tariff Order of FY 2006-07 ............................................................................. 299 Directives issued in Tariff Order of FY 2008-09 ............................................................................. 322 Directives issued in Tariff Order of FY 2010-11 ............................................................................. 325 Directives issued in Tariff Order of FY 2011-12 ............................................................................. 330
Generation, Transmission, Wheeling Charges and Open Access Charges ..................................... 333 10.1 10.2 10.3 10.4 Generation Tariff .......................................................................................................................... 333 Transmission Tariff....................................................................................................................... 333 Wheeling Charges........................................................................................................................ 333 Open Access Charges.................................................................................................................. 335
11
Renewable Purchase Obligation ....................................................................................................... 340 11.1 11.2 11.3 Background ................................................................................................................................. 340 Renewable Purchase Obligations (RPO) ....................................................................................... 340 Renewable energy Policy ............................................................................................................. 342
11.4 BERC (Renewable Purchase Obligation, its Compliance and REC Framework Implementation) Regulations, 2010 .................................................................................................................................... 343 11.5 11.6 11.7 11.8 12 Co-generation and Captive Power Policy ...................................................................................... 344 Renewable Potential .................................................................................................................... 344 Power purchase by BSEB under Renewable Purchase Obligations (RPO) ..................................... 345 Bihar Renewable Energy Development Agency (BREDA).............................................................. 346
Annexures.......................................................................................................................................... 348 12.1 12.2 Annexure I: State Advisory Committee ....................................................................................... 348 Annexure - II: List of Participant during the Public hearing. ............................................................ 355
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List of Table
Table 1: Schedule of issue of Public Notice in various newspapers................................................................... 15 Table 2: List of Objectors ................................................................................................................................ 16 Table 3: Additional list of Objectors.................................................................................................................. 17 Table 4: Schedule for public hearing ................................................................................................................ 19 Table 5: Status of TOD tariff implemented in various states .............................................................................. 46 Table 6: Summary of Category-wise Sales for FY 2010-11 ............................................................................... 66 Table 7: Proposed T&D losses by BSEB for FY 2010-11 .................................................................................. 67 Table 8: Approved T&D Loss for FY 2010-11 ................................................................................................... 68 Table 9: Summary of BTPS Performance proposed by Petitioner for FY 2010-11.............................................. 68 Table 10: Summary of approved Generation performance for FY 2010-11 ........................................................ 69 Table 11: Source-wise Power Purchase Quantum for FY 2010-11 (MUs).......................................................... 70 Table 12: Proposed Energy Requirement & Energy balance for FY 2010-11 ..................................................... 71 Table 13: Approved Energy Requirement for FY 2010-11................................................................................. 72 Table 14: Proposed Plant parameters & Fuel cost determinants for BTPS ........................................................ 73 Table 15: Approved plant parameters & fuel cost determinants for FY 2010-11 ................................................. 75 Table 16: Proposed Power Purchase cost for FY 2010-11 ................................................................................ 76 Table 17: Trued-up Power Purchase Cost for FY 2010-11 (Rs. Cr.) .................................................................. 77 Table 18: Disincentive: Non-achievement of T&D loss reduction target for FY 2010-11 ..................................... 78 Table 19: Employee Cost approved for FY 2010-11 (Rs Cr.) ............................................................................ 80 Table 20: Summary of approved R&M cost (Rs. Cr.) ........................................................................................ 81 Table 21: Summary of approved A&G cost (Rs. Cr.) ........................................................................................ 82 Table 22: Summary of approved O&M expenses for FY 2010-11 (Rs. Cr.) ........................................................ 83 Table 23: Details of capitalisation during FY 2010-11 (Rs. Lakh) ...................................................................... 84 Table 24: Estimation of CWIP (Rs. Cr.) ............................................................................................................ 84 Table 25: Estimated Capital expenditure (Rs. Cr.) FY 2010-11 ...................................................................... 84 Table 26: Asset added during FY 2010-11 in plant & machinery & Line & Cable N/W ........................................ 85 Table 27: Gross Fixed Assets (Rs. Cr.) FY 2010-11 ...................................................................................... 86 Table 28: Approved Depreciation (Rs. Cr.) for FY 2010-11 ............................................................................... 86 Table 29: Interest & Financial Charges as per the petition for FY 2010-11 (Rs. Cr.)........................................... 87 Table 30: Estimation of loan against assets getting capitalized during FY 2010-11 (Rs. Cr) ............................... 91 Table 31: Computation of effective Rate of Interest for FY 2010-11 (Rs. Cr.)..................................................... 91 Table 32: Approved Interest and finance charges for FY 2010-11 (Rs. Cr.) ....................................................... 92 Table 33: Proposed Interest on working capital for FY 2010-11 (Rs. Cr.) .......................................................... 92 Table 34: Summary of approved Interest on working capital (Rs. Cr.) ............................................................... 94 Table 35: Prior Period Credits / (Charges) for the FY 2010-11 (Rs. Cr.) ............................................................ 96 Table 36: Proposed Non-Tariff Income (Rs Cr.) for FY 2010-11 ........................................................................ 97 Table 37: Funding of DPS (Rs. Cr.) ................................................................................................................. 98 Table 38: Trued-up Non-Tariff Income approved (Rs. Cr.) ................................................................................ 99 Table 39: Non-Tariff Income (Rs. Cr.) .............................................................................................................. 99 Table 40; Details of FPPCA order issued by Commission during FY 2010-11 ................................................. 102 Table 41: Revenue through FPPCA (Rs. Cr.) ................................................................................................. 102 Table 42: Summary of Trued up ARR and Revenue gap for FY 2010-11 (Rs Cr.)............................................ 106 Table 43: Summary of the Carrying cost permitted (Rs Cr.) ............................................................................ 108 Table 44: Summary of revised Category-wise Sales (MUs) projected by BSEB for FY 2011-12 for BSEB ........ 109 Table 45: Proposed T&D losses as revised estimates for FY 2011-12 ............................................................ 111 Table 46: Approved T&D Loss for FY 2011-12 ............................................................................................... 112 Table 47 : Current Status of different units of BTPS ....................................................................................... 112 Table 48: Proposed Plant parameters & Fuel cost determinants for BTPS ...................................................... 113 Table 49: Fuel cost trend submitted by BSEB ................................................................................................ 115 Table 50: Approved Plant parameters of BTPS & fuel cost determinants for FY 2011-12 ................................. 115 Table 51: Power Purchase Cost Projected by the Petitioner for FY 2011-12 (RE)............................................ 116 Table 52: Approved revised estimates of Power Purchase Cost for FY 2011-12 (RE) ...................................... 117 Table 53: Proposed Energy Requirement & Energy Balance .......................................................................... 119 Table 54: Approved Energy Requirement for FY 2011-12 (RE) ....................................................................... 120 Table 55: Employees Cost Proposed for FY 2011-12 (RE) (Rs Cr) ................................................................. 121 Table 56: Approved revised estimates of employee Cost for FY 2011-12 (RE) (Rs. Cr.) .................................. 122 Table 57: Function-wise employee Cost approved for FY 2011-12 (RE) (Rs Cr.) ............................................ 123 Table 58: R&M costs submitted by Petitioner for FY 2011-12 (RE) (Rs Cr) ..................................................... 123 Table 59: Approved revised estimates of R&M Cost for FY 2011-12 (RE) (Rs. Cr.) ......................................... 124 Table 60: Function-wise approved R&M costs for FY 2011-12 (RE) (Rs Cr) .................................................... 124 Table 61: A&G costs submitted by Petitioner for FY 2011-12 (Rs Cr) .............................................................. 125 Table 62: Function-wise approved revised estimates of A&G costs for FY 2011-12 (RE) (Rs. Cr) .................... 125 Table 63: Approved revised estimates of A&G Cost for FY 2011-12 (Rs. Cr.).................................................. 125
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Table 64: Approved revised estimates of O&M Cost for FY 2011-12 (Rs. Cr.) ................................................. 126 Table 65: Planned Capital Expenditure proposed by BSEB for FY 2011-12..................................................... 127 Table 66: Funding details proposed by BSEB for FY 2011-12 (RE)................................................................. 128 Table 67: Funding pattern considered by Commission during FY 2011-12 (Rs. Cr.) (RE) ................................ 129 Table 68: Capitalization schedule for proposed capital expenditure ................................................................ 129 Table 69: Capitalization schedule for CWIP ................................................................................................... 129 Table 70: Approved GFA by Commission FY 2011-12 (RE)............................................................................ 130 Table 71: Approved GFA (Rs. Cr.) by Commission FY 2011-12 (RE) .............................................................. 130 Table 72: Revised estimate of Depreciation charges proposed by BSEB FY 2011-12 (RE).............................. 130 Table 73: Function wise revised Depreciation approved for FY 2011-12 (RE) (Rs Cr)...................................... 131 Table 74: Approved revised estimate of Depreciation (Rs. Cr.) charges for FY 2011-12 (RE) .......................... 131 Table 75: Proposed Interest & Financial Charges for FY 2011-12 (RE) ........................................................... 132 Table 76: Approved revised estimate of Interest & Finance Charges for FY 2011-12 (RE) (Rs Cr) ................... 134 Table 77: Approved revised estimate for Interest & Financial Charges for FY 2011-12 (RE) ............................ 135 Table 78: Methodology adopted by BSEB for calculation of Working Capital ................................................... 135 Table 79: Proposed revised estimates of Interest on Working Capital for FY 2011-12 (RE) (Rs Cr).................. 135 Table 80: Approved function wise Revised estimate of Interest on Working Capital for FY 2011-12 (RE) (Rs Cr) .................................................................................................................................................................... 136 Table 81: Approved revised estimate of interest on working capital for FY 2011-12 (RE) (Rs. Cr.) ................... 136 Table 82: Break-up of proposed non-tariff income for FY 2011-12 (RE) (Rs. Cr.)............................................. 137 Table 83: Funding of DPS (Rs. Cr.) ............................................................................................................... 139 Table 84: Approved revised estimate of Non-Tariff Income FY 2011-12 (RE) (Rs. Cr.) .................................... 139 Table 85: Approved revised estimate of revenue through sale of power for FY 2011-12 (RE) .......................... 141 Table 86: Additional Revenue for the FY 2011-12 (RE) .................................................................................. 143 Table 87: Disincentive for non-achievement of T&D loss reduction target for FY 2009-10 ................................ 144 Table 88: Details of Resource gap funding from State Government (Rs. Cr.) .................................................. 144 Table 89: details of State Government revenue gap support (Rs. Cr.) ............................................................. 145 Table 90: Aggregate Revenue Requirement for the FY 2011-12 ..................................................................... 146 Table 91: Historical Trend in category-wise units sold (MUs) .......................................................................... 149 Table 92: Category-wise growth rates of sales ............................................................................................... 149 Table 93: Category-wise no. of consumers .................................................................................................... 149 Table 94: Category-wise growth rates of no. of Consumers ............................................................................ 150 Table 95: Category-wise connected load ....................................................................................................... 150 Table 96: Categorywise growth rates of connected load ................................................................................ 151 Table 97: BPL consumption norms in other states......................................................................................... 152 Table 98: Approved Kutir Jyoti Consumption for FY 2012-13 .......................................................................... 155 Table 99: Projected no. of consumers, connected load and energy sale - BSEB ............................................. 165 Table 100: Projected no. of consumers, connected load and energy sale Premium tariff Area ...................... 166 Table 101: Projected no. of consumers, connected load & energy sale Rest of Bihar .................................. 166 Table 102: Approved no. of consumers, connected load & energy sales of BSEB for FY 2012-13 ................... 168 Table 103: Trend of No. of Consumer, connected load, unit and amount billed................................................ 170 Table 104: T&D Losses of BSEB for previous years and projections ............................................................... 172 Table 105: T&D loss target Vs. Achievement by BSEB................................................................................... 172 Table 106 : Current Status of different units of BTPS ..................................................................................... 175 Table 107: Proposed Plant parameters & Fuel cost determinants for BTPS .................................................... 176 Table 108: Month wise projected power generation from BTPS for FY 2012-13 .............................................. 177 Table 109: Fuel cost trend submitted by BSEB .............................................................................................. 177 Table 110: Approved Plant parameters of BTPS & fuel cost determinants for FY 2012-13 ............................... 179 Table 111: Power Purchase Cost Projected by the Petitioner for FY 2012-13.................................................. 180 Table 112: Executed PPA with developer for power based on renewable energy ............................................ 182 Table 113: Proposals received for setting-up renewable energy plants ........................................................... 183 Table 114: Approved Power Purchase Cost for FY 2012-13 ........................................................................... 186 Table 115: Proposed Energy Requirement & Energy Balance ........................................................................ 187 Table 116: Approved Energy Requirement for FY 2012-13 (in MU)................................................................. 188 Table 117: Employees Cost Proposed for FY 2012-13 (Rs Cr) ....................................................................... 191 Table 118: Function-wise employee Cost approved for FY 2012-13 (Rs Cr.) ................................................... 193 Table 119: R&M costs submitted by Petitioner for FY 2012-13 (Rs Cr)............................................................ 194 Table 120: Function-wise approved R&M costs for FY 2012-13 (Rs Cr) .......................................................... 194 Table 121: A&G costs submitted by Petitioner for FY 2012-13 (Rs Cr ............................................................. 195 Table 122: Function-wise approved A&G costs for FY 2012-13 (Rs Cr) .......................................................... 196 Table 123: Function-wise approved O&M costs for FY 2012-13 (Rs Cr) .......................................................... 196 Table 124: Planned Capital Expenditure proposed by BSEB for FY 2012-13................................................... 197 Table 125: Details of loan received with sanction letter................................................................................... 198 Table 126: Funding details proposed by BSEB for FY 2012-13)...................................................................... 199 Table 127: Funding pattern considered by Commission for FY 2012-13 .......................................................... 200 Table 128: Capitalization schedule for proposed capital expenditure .............................................................. 200 Table 129: Capitalization schedule for CWIP ................................................................................................. 201 Table 130: Approved GFA by Commission FY 2012-13 (Rs. Cr.) .................................................................... 201
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Table 131: Depreciation charges proposed by BSEB (Rs. Cr.) ....................................................................... 202 Table 132: Function wise Depreciation approved for FY 2012-13 (Rs Cr)........................................................ 203 Table 133: Proposed Interest & Financial Charges for FY 2012-13 ................................................................. 204 Table 134: Approved revised estimate of Interest & Finance Charges for FY 2012-13 (Rs Cr) ......................... 205 Table 135: Approved revised estimate for Interest & Financial Charges for FY 2012-13 .................................. 206 Table 136: Methodology adopted by BSEB for calculation of Working Capital ................................................. 206 Table 137: Proposed Interest on Working Capital for FY 2012-13 (Rs Cr) ....................................................... 207 Table 138: Approved Interest on Working Capital for FY 2012-13 (Rs Cr) ....................................................... 207 Table 139: Break-up of proposed non-tariff income for FY 2012-13 (Rs.Cr.).................................................... 208 Table 140: Funding of DPS (Rs. Cr.) ............................................................................................................. 209 Table 141: Approved Non-Tariff Income for FY 2012-13 (Rs. Cr.) ................................................................... 210 Table 142: Revenue Projected for Premium tariff area, RoB and BSEB at existing tariff .................................. 211 Table 143: Revenue assessed for BSEB at existing tariff by Commission ....................................................... 213 Table 144: Additional Revenue for the FY 2012-13 ........................................................................................ 216 Table 145; Approved cost of additional power purchase through resource gap for FY 2012-13 ........................ 217 Table 146: Approved Revenue Gap/Surplus for FY 2006-07 to FY 2011-12 (Rs. Cr.) ...................................... 217 Table 147: Aggregate Revenue Requirement for the FY 2012-13 at existing tariff (Rs. Cr.) ............................. 218 Table 148: Function-wise breakup of ARR approved by Commission for FY 2012-13 (Rs. Cr.) ........................ 219 Table 149: Revenue from Sale of energy at Approved Tariff for FY 2012-13 ................................................... 219 Table 150: Revenue Gap at Approved Tariff for FY 2012-13 (Rs. Cr.) ............................................................. 220 Table 151: Revenue Gap at Approved Tariff for FY 2011-12 (Rs. Cr.) ............................................................. 221 Table 152: Cross-Subsidy in FY 2011-12 & FY 2012-13 ................................................................................. 222 Table 153: Details of Resource gap grant received from State Government .................................................... 224 Table 154: Subsidised categories in Tariff Order for FY 2012-13 .................................................................... 227 Table 155: Subsidy receivable from State Government for FY 2012-13........................................................... 228 Table 156: Generation Tariff Net generation (MUs) ........................................................................................ 333 Table 157: Transmission Tariff (in Paise/kWh) ............................................................................................... 333 Table 158: Wheeling charges at 33 kV Voltage Level ..................................................................................... 334 Table 159: Wheeling charges for 11 kV Voltage Level .................................................................................... 334 Table 160 : Phase Category of Consumers Open Access to be allowed from.................................................. 335 Table 161: Transmission Charge ................................................................................................................... 336 Table 162: Open Access Charges ................................................................................................................. 336 Table 163: Renewable Purchase obligation for BSEB .................................................................................... 344 Table 164: Co-generation Plants in Bihar ....................................................................................................... 344 Table 165: Technology wise potential & installed capacity in Bihar ................................................................. 344 Table 166: Details of Power Purchase from Renewable Source (MU) by BSEB .............................................. 345 Table 167: Members present during the SAC meeting.................................................................................... 348
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List of Abbreviations
A&G ABT Act AG ARR BERC BHEL BHPC BIFR BSEB BTPS CAGR CAPEX CEA CERC CGS Ckt km CMD CPSU D/C DPS DS DSM DT EA 2003 ERLDC ERPC FC FPPCA FY GFA GFA HP HT HTSS KBUNL kCal KJ KL kVA kVAh Administration and General Availability Based Tariff Electricity Act, 2003 Auditor General Aggregate Revenue Requirement Bihar Electricity Regulatory Commission Bharat Heavy Electrical Limited Bihar State Hydro Power Station Bureau of Industrial and Financial Reconstruction Bihar State Electricity Board Barauni Thermal Power Station Compounded Annual Growth Rate Capital Expenditure Central Electricity Authority Central Electricity Regulatory Commission Central Generating Station Circuit kilometres Contract Minimum Demand Central Public Sector Undertaking Double Circuit Delayed Payment Surcharge Domestic Service Demand Side Management Distribution Transformer Electricity Act, 2003 Eastern Region Load Despatch Centre Eastern Region Power Committee Fixed charges Fuel and Power Purchase Cost Adjustment Financial Year Gross Fixed Asset Gross Fixed Asset Horse Power High Tension High Tension Specified Service Kanti Bijlee Utapadan Nigam Limited Kilo Calorie Kutir Jyoti Kilo Litre Kilo Volt Ampere Kilo Volt Ampere Hour
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kWh LT ml MMC MoP MT MUs MVA MW MYT NDS NEP NFA NHPC NTPC O&M O/H PGCIL PLF PWW R&M RE REA RGGVY RLDC RoE S/C SAC SERC SS ToD TP TPS UI ULF USO
Kilo Watt hour Low Tension Millilitre Monthly Minimum Charge Ministry of Power Million Tonne Million Units Mega Volt Ampere Mega Watt Multi-Year Tariff Non Domestic Service National Electricity Policy Net Fixed Asset National Hydro Power Corporation National Thermal Power Corporation Operation and Maintenance Over Head Power Grid Corporation of India Limited Plant Load Factor Public Water Works Repair and Maintenance Revised Estimates Regional Energy Accounting Rajiv Gandhi Grameen Vidyutikaran Yojna Regional Load Despatch Centre Return on Equity Single Circuit State Advisory Committee State Electricity Regulatory Commission Sub-station Time of Day Tariff Policy Thermal Power Station Unscheduled Interchange Utilization Load Factor Universal Service Obligation
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BERC
TARIFF ORDER FOR FY 2012-13
Bihar Electricity Regulatory Commission Ground Floor, Vidyut Bhawan II Jawahar Lal Nehru Marg, Patna 800 021
Case No. TP - 02 of 2011
In the matter of: Determination of Aggregate Revenue Requirement (ARR) and Retail Tariff for the Financial Year 2012-13 for supply of electricity to consumers in the State of Bihar by the Bihar State Electricity Board. And Bihar State Electricity Board .. Petitioner Present:
U.N. Panjiar S.C. Jha
Chairman Member
ORDER
(Passed on 30th Day of March, 2012)
In exercise of the powers vested to Bihar Electricity Regulatory Commission under section 62(1)(d) read with Section 62(3) and Section 64 (3)(a) of the Electricity Act, 2003 and Bihar Electricity Regulatory Commission (Terms and Conditions for Determination of Tariff) Regulations 2007 (hereinafter referred to as 'Tariff Regulations') and other enabling provisions in this behalf, the Commission issues this order, truing up of the Aggregate Revenue Requirement (ARR) and revenue for financial year (FY) 2010-11, Reviewing of ARR and revenue for FY 2011-12 and determining the Aggregate Revenue Requirement
Bihar Electricity Regulatory Commission Page 1
BERC
(ARR) and the Retail Tariff for the Financial Year 2012-13 for supply of electricity by the Bihar State Electricity Board to the consumers in the state of Bihar. Tariff Regulations specify that the Distribution Licensee shall file Aggregate Revenue Requirement (ARR) and the Tariff Petition complete in all respect along with requisite fee as prescribed in the Commissions Fees, Fines and charges, Regulation on or before 15th November of the preceding year. Accordingly the Licensee BSEB filed the ARR and Tariff Petition for the financial year 2012-13 along with the petitions for review of ARR for FY 2011-12 on 15th November, 2011 and subsequently BSEB filed petition for truing up of ARR and revenue for financial year 2010-11 . Regulation 22 of the Tariff Regulations, 2007 provides that the Commission shall undertake a review along with next Tariff Order, of the expenses and revenue approved by the Commission in the current year's Tariff Order. After audited accounts of the year are made available, the Commission shall undertake a similar exercise based on the final actual figures as per the audited accounts. Accordingly BSEB along with petition for determination of ARR and retail tariff for FY 2012-13, has also submitted petitions for truing up of ARR and revenue for FY 2010-11 based on the audited annual accounts for the year and for review of the ARR for FY 2011-12. As per Regulation 6(5) of the Tariff Regulation and for providing adequate opportunities to all stakeholders and general public for making suggestions/objections on the tariff petition as mandated under section 64(3) of the Electricity Act, 2003, the Commission directed BSEB vide letter dated 28th November 2011 to publish the ARR and tariff petition for FY 2012-13 in abridged form as public notice in newspapers having wide circulation in the State inviting suggestions/objections on the tariff petition. The tariff petition was also placed on the BSEB's website. Accordingly BSEB published the tariff petition in the abridged form as public notice in various newspapers. The last date of submission of suggestions/objections was initially fixed as 6th January, 2012 which was later on extended to 20th January, 2012 on the request of some of the consumers/consumer associations. The Commission, to ensure transparency in the process of tariff determination and for providing proper opportunity to all stakeholders and general public for making suggestions/objections on the tariff petition and for convenience of the consumers and general public across the state, the Commission decided to hold the public hearing at all the divisional headquarters of the state and accordingly the Commission held public hearing at Darbhanga on 15th February 2012, Bhagalpur on 23rd February 2012, Purnea on 24th February 2012, Gaya on 27th February 2012, Muzaffapur on 13th March 2012 and Patna on 14th & 19th March 2012.
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The tariff proposal was also placed before the State Advisory Committee on 23rd December, 2011 and the various aspects were discussed by the Committee. The Commission took the advice of the State Advisory Committee on the ARR and tariff petition of BSEB for FY 201213 during the meeting of the Committee. The Commission took into consideration the facts presented by the BSEB in its tariff petition and subsequent various filings, the suggestions/objections received from stakeholders, consumer organizations, general public and State Advisory Committee and response of the Bihar State Electricity Board to those suggestions/objections. The Commission taking into consideration all the facts which came up during the public hearing and meeting of the State Advisory Committee has trued up the ARR and revenue for FY 2010-11, reviewed the ARR and revenue for FY 2011-12 and determined the ARR and retail tariff of the BSEB for FY 2012-13. The true up of ARR and revenue for FY 2010-11 has indicated a surplus of Rs. 639.93 crores. The review of ARR and revenue for FY 2011-12 has given a surplus of Rs. 674.63 crores. Earlier true up for FY 2006-07, 2007-08, 2008-09 and 2009-10 had indicated a cumulative gap of Rs. 491.87 crores. The State Government has been giving resource gap grant to BSEB which has been used for reducing the revenue gap of BSEB. This treatment of resource gap has the effect of reducing the average tariff of all categories of consumers across the state till FY 2011-12. The State Government vide letter No. 4208 dated 19th September, 2011 has clarified that the resource gap grant being provided to the BSEB is meant for first compensating BSEB for the financial loss incurred by BSEB on account of additional power purchase due to difference in the actual T&D loss and the T&D losses as approved by the Commission and the balance amount of resource gap grant will be used to subsidise the agricultural and rural consumers. The resource gap grant estimated to be received during FY 2012-13 has been used to first compensate BSEB for the financial losses caused to BSEB on account of additional power purchase due to difference in the actual T&D losses and the T&D losses approved by the Commission and the remaining portion of the grant has been used to subsidise the agriculture and rural consumers. As a result of government subsidy, the tariff rate of Agriculture, Kutir Jyoti, and other rural consumers has been retained at the level of 2011-12 and no increase has been approved. The BSEB in its tariff petition for FY 2012-13 has proposed 10% premium on demand/fixed and energy charge and in MMC for LT consumers except Kutir Jyoti and Agriculture and
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HTS-I consumers for the PESU Area, Rajgir Area and Bodh Gaya Area in which BSEB intends to supply continuous power at least for 600 hours in a month excluding the duration of grid failure, plant failure of power supplier, any force majeure condition, scheduled shut down, emergent breakdown and restriction of power supply by the Commission under Section 23 of the Electricity Act, 2003. The Commission feels that the Distribution Licensee cannot differentiate in making electric supply available to different areas. As per provisions of the Act, there should be equitable distribution of available energy in different areas. So the Commission directs the Board for equitable distribution of energy in different areas of the State as far as possible. However, if the Board supplies or intends to supply power continuously to some areas including Patna, this should not be done at the cost of supply to other areas. BSEB can charge premium over the normal tariff from consumers of such areas getting nearly 24 hours of supply from 33kV or 11 kV feeders to HTS-I and all LT consumers except Kutir Jyoti and Agricultural consumers. The continuous supply shall mean the normal supply for nearly 24 hours excluding the grid failure, any force majeure condition, scheduled shut down and emergent breakdown beyond the control of BSEB. The Commission has accordingly allowed 10% premium on fixed and energy charge and in MMC in tariff rate of HTS- consumers and all LT consumers and 11 kV consumers except Kutir Jyoti and Agricultural Consumers. The Board has to notify such areas after strengthening the infrastructure required to ensure close to 24 hour supply to the notified areas. Strengthening of infrastructure may include interalia strengthening/replacement of weak conductors, transformers and other electrical equipments installed for supplying electricity to the notified areas, provision of appliances and spares and keeping technical teams ready round the clock for rectifying defects leading to disruption of supply in these areas. A few Telephones should be kept operational for each notified area which should be manned round the clock for receiving and responding to the complaints. These telephone numbers should be widely publicised in the newspapers for the information of the general public. BSEB must ensure these steps for ensuring close to 24 hours supply of electricity to the notified areas before charging premium tariff. BSEB in this tariff petition has proposed Transmission and Distribution loss of 42% for the FY 2011-12 and 41% loss for FY 2012-13. The Commission has allowed the T&D losses at 29% for FY 2011-12 and 27.5% for FY 2012-13 as per approved trajectory. The financial loss caused to BSEB due to the difference between the actual T&D loss as stated by the Board and T&D losses approved by the Commission has been compensated from the resource gap grant provided by the State Government.
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The Commission has made Time of Day (TOD) tariff mandatory for consumers with contract demand of 200KVA and above in the tariff order for FY 2011-12 which provides incentive for consumption in off peak hours and disincentive for consumption of power in peak hours. The Commission has considered this provision proper for demand side management and so this provision has been retained in this tariff order also. For other HT consumers ToD Tariff has been made optional. The Commission has approved a new provision for Tatkal Connection on payment of application fee and supervision, labour and establishment charge for service connection at double the normal rate. Under the scheme a consumer may apply for new connection on Tatkal basis and BSEB will provide Tatkal connection within half the period specified for normal connection. If BSEB is not able to provide connection within the specified period then the additional fee paid by the consumer will be refunded in the first energy bill. The Commission has also allowed partial payment of energy bill as an option available to the consumers. The BSEB in its tariff petition has proposed various changes in the terms and conditions of supply which the Commission has properly scrutinized and has considered
suggestions/objections of the stakeholders, consumers and general public and has accordingly specified the terms and conditions of supply in this Tariff Order. The Board has proposed to withdraw the facility of ten (10) days grace period after due date of payment without any Delayed Payment Surcharge (DPS). The Commission considering the suggestions of the consumers as well as State Advisory Committee, has retained the provision of ten days grace period after due date of payment without levy of any Delayed Payment Surcharge. In the Tariff Order for FY 2011-12, the Commission had indicated the desirability of phasing out the Monthly Minimum Charge (MMC). As a first step MMC was replaced by Annual Minimum Guarantee (AMG) for HT consumers. Since the revenue from MMC/AMG from HT consumers is only about 0.5% of the total revenue of the Board and metering/billings of the HT consumers are monitored more closely because of their limited numbers, the Commission has done away with the provision of MMC/AMG for HT consumers. Phasing out of MMC/AMG for other categories of consumers will be considered gradually. To encourage the consumers to avail power under Open Access from other sources, the Commission has reduced the cross subsidy surcharge by about 50% (fifty percent) in its Tariff Order for FY 2011-12 which the Commission has retained during 2012-13 also.
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As a result, the consumers have to pay cross subsidy surcharge at the rate of about 50% of the rate approved in Tariff Policy 2006. The provision of charging Fuel and Power Purchase Cost Adjustment (FPPCA) with the approval of the Commission on a monthly basis which was introduced in the Tariff Order for FY 2011-12 has been retained. FPPCA has been made applicable to all categories of consumers without any exception. However, FPPCA levied on Kutir Jyoti and Agriculture (Private) consumers will be subsidized with the subsidy available from State Government. This order is in 12 chapters which also include True up for FY 2010-11, Review for 2011-12 and detailed analysis of the Aggregate Revenue Requirement (ARR) and approved Retail Tariff Rates for the financial year 2012-13. The ARR after incorporating surplus from previous years is Rs. 4747.22 crores. The revenue gap at existing tariff as determined by the Commission is Rs. 1676.60 crores. To avoid sharp increase in tariff rates, the Commission has approved a moderate increase of 12% in average tariff which will fetch an additional revenue of Rs. 348.06 crores. The existing average tariff is Rs.4.06 per unit which has now been increased to Rs. 4.55 per unit. Considering the sale of intra-state revenue at approved tariff and sale outside the state, revenue gap comes to Rs. 841.17 crores. Resource gap grant of Rs. 683.90 crore has been used to subsidise Kutir Jyoti, Agriculture and other rural consumers to bring down their tariff to the level of financial year 2011-12. As a result, the revenue gap at approved tariff has come down to Rs. 157.26 crores. In order to avoid further increase in tariff, the revenue gap of Rs. 157.26 crores is being approved as regulatory asset which will be recovered along with carrying cost in the subsequent financial years after true up for FY 2011-12 and review of the ARR for FY 2012-13 along with determination of ARR and retail tariff for FY 2013-14. With a view to enforce quality, efficiency, transparency and accountability in the operation of BSEB in this Order the Commission has issued fresh directives to BSEB for strengthening the consumer complaint redressal mechanism, circle-wise fixing and monitoring of loss trajectory, determining category-wise and voltage-wise T&D loss and cost of supply, preparation of separate business plan for generation, transmission and distribution functions and submitting multi year tariff petition for generation, transmission and distribution for a period of 3 years starting from FY 2013-14. This order shall be effective w.e.f. 1st April 2012. The Bihar State Electricity Board should ensure implementation of the order from the effective date after issuance of a Public Notice, in such a font size which is clearly visible, in two daily newspaper having wide circulation in the various parts of state within a week and compliance of the same shall be submitted to the Commission by the BSEB.
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This order shall remain in force till 31st March, 2013 or till the next tariff order of the Commission. This order will be placed on the website of the Commission and a copy will be sent to BSEB, Department of Energy, Government of Bihar, Central Electricity Regulatory Commission and all State/Joint Electricity Regulatory Commissions.
Sd/-
Sd/-
(S. C. Jha) Member
(U. N. Panjiar) Chairman
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1 Introduction
1.1 1.1.1
Bihar Electricity Regulatory Commission The Bihar Electricity Regulatory Commission (hereinafter referred to as
Commission or BERC) was constituted by the Government of Bihar under Section 17 of the Electricity Regulatory Commission Act, 1998 vide Government of Bihar notification No.1284 dated 15th April 2002. The Electricity Regulatory Commission Act, 1998 along with Indian Electricity Act, 1910 and Electricity (Supply) Act, 1948 was repealed by Section 185 (1) of the Electricity Act, 2003 (hereinafter referred to as the Act). The first proviso of Section 82 (1) has ensured continuity of the Bihar Electricity Regulatory Commission by laying down that the State Electricity Regulatory Commission established by the State Government under Section 17 of Electricity Regulatory Commission Act, 1998 and functioning as such, immediately before the appointed date, shall be the State Electricity Regulatory Commission for the purpose of the Act. 1.2 1.2.1 Functions of BERC As per Section 86 of the Electricity Act 2003, the State Commission shall discharge the following functions, namely a) determine the tariff for generation, supply, transmission and wheeling of electricity, wholesale, bulk or retail, as the case may be, within the State: Provided that where open access has been permitted to a category of consumers under section 42, the State Commission shall determine only the wheeling charges and surcharge thereon, if any, for the said category of consumers; b) regulate electricity purchase and procurement process of distribution licensees including the price at which electricity shall be procured from the generating companies or licensees or from other sources through agreements for purchase of power for distribution and supply within the State; c) facilitate intra-state transmission and wheeling of electricity;
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d)
issue licences to persons seeking to act as transmission licensees, distribution licensees and electricity traders with respect to their operations within the State;
e)
promote co-generation and generation of electricity from renewable sources of energy by providing suitable measures for connectivity with the grid and sale of electricity to any person, and also specify, for purchase of electricity from such sources, a percentage of the total consumption of electricity in the area of a distribution licence;
f) g) h) i)
adjudicate upon the disputes between the licensees, and generating companies and to refer any dispute for arbitration; levy fee for the purposes of this Act; specify State Grid Code consistent with the Indian Electricity Grid Code specified with regard to grid standards; specify or enforce standards with respect to quality, continuity and reliability of service by licensees;
j) k) 1.2.2
fix the trading margin in the intra-state trading of electricity, if considered, necessary; and discharge such other functions as may be assigned to it under this Act.
The State Commission shall advise the State Government on all or any of the following matters, namely a) b) c) d) promotion of competition, efficiency and economy in activities of the electricity industry; promotion of investment in electricity industry; reorganization and restructuring of electricity industry in the State; matters concerning generation, transmission, distribution and trading of electricity or any other matter referred to the State Commission by State Government.
1.3 1.3.1
Bihar State Electricity Board Bihar State Electricity Board (hereinafter referred to as Board or BSEB) is a statutory body constituted on1st April 1958 under Section 5 of the Electricity (Supply) Act, 1948 and has been engaged in electricity generation, transmission, distribution of electricity and related activities in the State of Bihar.
1.3.2
In exercise of the power conferred by the proviso of 172(a) of the Electricity Act, 2003, the Govt. of Bihar has allowed BSEB to continue to function as State Transmission Utility and a Licensee for Distribution of Power till 31.12.2011.
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1.3.3
Presently, the Board is thus functioning as deemed State Transmission Utility (STU) and a Distribution Licensee. This Aggregate Revenue Requirement & tariff petition for FY 2012-13 has been submitted by the State Transmission Utility and the Distribution Licensee.
1.4 1.4.1
Chronology of the filing of tariff petitions and Issue of Tariff Orders The BSEB had submitted its first Aggregate Revenue Requirement (hereinafter referred to as ARR) and tariff petition for the FY 2006-07 on 10th April, 2006. The Commission passed the Tariff Order on that petition on 29th November, 2006.
1.4.2
The BSEB submitted its ARR and tariff petition for FY 2007-08 on 18th December, 2007. As the tariff petition for FY 2007-08 was filed very late, the Commission vide letter no. BERC.Tariff-9/07-03 dated 2nd January 2008 directed the BSEB to file the ARR and tariff petition for FY 2008-09 along with data as specified by the Commission in the BERC (Terms and conditions for determination of Tariff) Regulations, 2007 by 31st January 2008.
1.4.3
The BSEB submitted its ARR and tariff petition for FY 2008-09 on 14th February, 2008. The Tariff Order for FY 2008-09 was passed by the Commission on 26th August, 2008. The Commission also undertook the Review of ARR for FY 2006-07 along with Tariff Order for FY 2008-09.
1.4.4
The BSEB filed on 9th October 2009 petition for determination of ARR and approval of retail tariff for FY 2009-10. However, due to delay in filing of the ARR/ tariff petition for FY 2009-10, the Commission directed the BSEB to file the ARR and tariff petition for the FY 2010-11. In view of the same, there was no approval of the ARR for FY 2009-10.
1.4.5
The BSEB submitted its ARR and tariff petition for FY 2010-11 before the Commission on 3rd February, 2010. The Commission passed the Tariff Order for FY 2010-11 on 6th December, 2010. The Commission also undertook the Review of ARR FY 2008-09 along with the Tariff Order for FY 2010-11.
1.4.6
The BSEB submitted its ARR and tariff petition for FY 2011-12 before the Commission on 17th February, 2011. The Commission passed the Tariff Order for FY 2011-12 on 1st June, 2011 effective from 1st May 2011.
1.4.7
The True-up petition for FY 2006-07, FY 2007-08 and FY 2008-09, based on the audited annual accounts of BSEB, was filed by the BSEB on 01st September 2011.
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The addendum to this True-up petition was filed by BSEB on 17th October 2011. The Commission passed its first truing up order for FY 2006-07, FY 2007-08 and FY 2008-09 on 4th January 2012. 1.4.8 Subsequently, the BSEB filed the True-up petition for FY 2009-10 on 13th October, 2011. The truing up order for FY 2009-10 was issued by the Commission on 27th January 2012. 1.4.9 BSEB also submitted a petition on 13th October, 2011 vide letter no. Com/ FPPCA136/2011-1659 for the review of ARR for FY 2010-11 based on their provisional annual accounts. The Commission vide its Order dated 3rd November, 2011 directed BSEB to submit its petition for review of the expenses and revenues for the FY 201011 along with tariff petition for FY 2012-13. Commission also directed BSEB that, if the final audited accounts for the FY 2010-11 are made available to the Commission along with or during the hearing of tariff petition for FY 2012-13, a final true up of the expenses and revenues for the FY 2010-11 shall be considered by the Commission. 1.4.10 The Board filed its ARR and tariff petition for FY 2012-13 on 15th November 2011. In this petition the Board has also carried out review exercise for FY 2011-12 projecting the revised estimates for FY 2011-12 based on the provisional annual accounts of BSEB for FY 2010-11. A Supplementary petition for determination of ARR & retail tariff petition for FY 2012-13 was subsequently filled by the Board vide letter No. Com/ Tariff-152/ 2011-(Part-I) -017 on 2nd January 2012. 1.4.11 Further, BSEB vide letter No. Com/ Tar-132/ 2011-392 dated 2nd March, 2012 submitted the audited annual accounts for FY 2010-11 along with the audit certificate issued by CAG to the Commission. Subsequently, BSEB vide letter No. Com/ Tar132/ 2011-451 dated 16th March, 2012 submitted the true-up petition of BSEB for FY 2010-11 based on the audited annual accounts for FY 2010-11. 1.4.12 The purpose of this order is to true up the ARR and revenue for FY 2010-11, review expenses and revenue for FY 2011-12 and approve ARR and retail tariff for FY 201213. 1.5 1.5.1 Scope of the Order In the absence of audited accounts of FY 2010-11, BSEB filed its Review petition for FY 2010-11 for approval of the Commission. Subsequently on 5th March 2012 vide letter No Com/Tar- 132/2011-392 dated 02.03.2012, BSEB has submitted audited
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annual accounts for FY 2010-11 along with the audit certificate issued by CAG and true-up petition for FY 2010-11 on 16th March, 2012 vide letter No. Com/ Tariff132/2011-451. 1.5.2 The scope of this order extends to: a) Truing up exercise for FY 2010-11based on audited annual accounts of the Board for FY 2010-11; b) Review exercise for FY 2011-12; c) Determination of ARR and retail tariff for sale of electricity for FY 2012-13; 1.5.3 The aforementioned exercise has been done by taking into consideration the provisions of: a) Electricity Act, 2003; b) National Electricity Policy; c) Tariff Policy; d) BERC (Terms and conditions for determination of Tariff) Regulations, 2007.
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2 Procedural History
2.1 2.1.1
Background BSEB has filed petition for determination of tariff for FY 2012-13, review of expenses for FY 2011-12 and for true-up of ARR and revenue for FY 2010-11. The tariff petition for FY 2012-13 filed by the BSEB vide letter No.- Com / Tariff/ 152/ 2011 1838 dated 15th November 2011 for approval of the ARR and determination of retail tariff for FY 2012-13 also includes the proposal for review of ARR for FY 2011-12 based on the annual accounts of the Board for FY 2010-11.
2.1.2
As per the BERC (Terms and conditions for determination of Tariff) Regulations, 2007, BSEB is required to submit the audited annual accounts of the previous years along with the tariff petition for the next year, which the BSEB has submitted on 5th March 2012 vide letter No. Com/ Tar-132/ 2011-392 dated 02.03.2012 as per the Commission order dated 3rd November 2011.
2.1.3
Subsequently, BSEB vide letter no. Com/tariff-152/2011 (Part-1)-2079 dated 30th December 2011 submitted a supplementary tariff petition for FY 2012-13.
2.2 2.2.1
Information Gaps in the petition In the process of scrutinizing the tariff petition filed by the Petitioner, the Commission observed some data gaps in the ARR & tariff petition received from the Petitioner.
2.2.2
The data gaps observed by the Commission were communicated to the Petitioner vide Commissions letter No. BERC- Tariff 24/11- 825 dated 21st December, 2011 and reminders vide letter No. BERC- Tariff 24/11- 56 dated 18th January, 2012 and BERC- Tariff 24/11- 88 dated 27th January, 2012. The Petitioner provided only the partial data vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 after taking fifty (50) days time.
2.2.3
Further clarifications were sought from the Petitioner vide Commissions letter No. BERC - Tariff 24/11- 88 dated 27th January, 2012 and reminder vide letter No BERC- Tariff 24/11- 137 dated 13th February, 2012. The Board submitted its
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response on 1st March 2012 vide letter No. Com/ Tar-132/2011-375 taking further thirty-five (35) days. 2.2.4 Additional information was sought from the Board vide Letter No. BERC- Tariff24/11-202 dated 01st March 2012. The Board submitted its response through electronic mail on Commissions official e-mail address (bercpat@berc.co.in) and through letter No. Com/ Tar-161/2011-421 dated 12th March 2012. 2.2.5 Further, during the public hearing on the petition of BSEB in Patna, additional information was sought from the Board vide Commissions Letter No. BERC- Tariff24/11-244 dated 15th March 2012. The Board submitted its response through letter No. Com/ Tar-161/2011(Part-1) - 444 dated 16th March 2012. 2.2.6 From time to time and till the finalization of this Tariff Order, the Commission regularly interacted with the officials of the BSEB to validate the information submitted by them. 2.3 2.3.1 Inviting comments / suggestions from Public As per sub-Clause 6 (5) of the BERC (Terms and conditions for determination of Tariff) Regulations 2007,and for providing adequate opportunity to all stakeholders and general public for making suggestions/ objections on the tariff petition as mandated under section 64(3) of the Electricity Act 2003, the Commission vide its letter No. BERC- Tariff 24/ 11 - 774 dated 28th November 2011 directed the BSEB to publish the ARR and tariff petition for FY 2012-13 in an abridged form in shape of a public notice in at least two daily newspapers, one in English and the other in Hindi, having wide circulation in the state inviting objections and suggestions on the tariff petition. To ensure maximum participation from all the stakeholders and general public at large the tariff petition was also placed on BSEB website
(http://www.bseb.bih.nic.in/Notices.htm) and copies of the petition along with annexures were also made available for sale in the office of the Chief Engineer (Commercial), BSEB Patna and in the Office of All Area General Managers-cumChief Engineers and all Superintending Engineers In-charge of supply circles of the Board.
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2.3.2
The tariff petition for the FY 2012-13 in abridged form was published as public notice in different newspapers as mentioned in the table below:
Table 1: Schedule of issue of Public Notice in various newspapers
Sl. 1. 2. 3. 4. 1. 2. 1. 2. 1. 2.
Name of News Paper Danik Jagaran (Hindi) Times of India, Patna (English) Hindustan, Patna (Hindi) Prabhat Khabar (Hindi) Prabhat Khabar (Hindi) Times of India, (English) Hindustan (Hindi) Times of India, (English) Prabhat Khabar (Hindi) Times of India, (English)
Date of Publication Issued in Patna Edition Newspaper 08th December 2011 & 6th March 2012 09 Dec 2011, 13 Dec. 2011 & 6 March 2012 12 December 2011 & 6 March 2012 6 March 2012 28 January 2012 29th January 2012 17 February 2012 17 February 2012 28 January 2012 & 3 March 2012 29th January 2012 & 3rd March 2012
th rd th th th th th th th th th
Issued in Dharbhanga Edition Newspaper
Issued in Bhagalpur, Purnia and Gaya Edition Newspaper
Issued in Muzaffarpur Edition Newspaper
2.3.3
However, despite the direction of Commission vide its letter No. BERC- Tariff 24/ 11 - 774 dated 28th November 2011 to publish the ARR and tariff petition for FY 2012-13 to ensure maximum participation from all the stakeholders and general public, initially BSEB did not upload the supplementary ARR and tariff petition for FY 2012-13 on their website, although the supplementary ARR and tariff petition for FY 2012-13 was filed by the BSEB on 30th December 2011. The Commission took notice of the same and again directed the BSEB vide letter No BERC- Tariff 24/11199 dated 29th February 2012 and letter No BERC- Tariff 24/11 210 dated 2nd March 2012 to upload the same on the official website of BSEB without any further delay inviting comments and suggestion of the public during the remaining two public hearings which were scheduled on 13th March 2012 and 14th March 2012 at Muzaffarpur and Patna respectively. Accordingly, the BSEB uploaded the supplementary ARR and tariff petition for FY 2012-13 on the BSEB website on 05th March 2012 for consideration during ARR and tariff determination process and public hearing.
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2.3.4
The last date of submission of comments was initially fixed as 06th January 2012. Later, on request of some consumers/ consumers associations, the Commission extended the date for submission of objections/ suggestions to 20th January 2012 and public notice was issued by Commission on 7th January 2012 vide Notice No.-1.
2.3.5
Comments and suggestions were received from fifteen (15) consumers/ consumer associations and general public up to the due date i.e. 20th January 2012. The list of persons/ organizations whose suggestions/ comments have been received is as given in the table below:
Table 2: List of Objectors
Sl. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Name of Consumer/ consumer organizations M/s Dadiji Steel Ltd. M/s Kalyanpur Cements Ltd. M/s Patwari Steel Pvt Ltd. Shri Pramod Kumar Sharma M/s Bihar Steel Manufacturing Association M/s Balmukund Concast Limited Shri Doman Singh Chief Electrical Engineer (ECR, Hazipur) Shri Braj Nandan Pathak,Vidyut Upbhogta Sangarsh Samiti M/s Bhola Ram Steel Private Ltd. M/s Bhojpur Chamber of Commerce & Industry M/s Bihar Chamber of Commerce Shri Vinay Goenka Shri Vyasdev Prasad M/s Dina Iron and Steel
Address 502, Santosha Complex, Bandar Bagicha, Fraser Road Patna Maurya Centree, Freser Road Patna Fathua Patna Dilawaerpur west, P.O. Viddupur Bazar, Vaishali 307, Ashiyana Tower, Exhibition Road Patna Kalyani Complex, Exhibition Road Patna B-44, Road No-2, Anand Bihar Patna East Central Railway Patna 93, Lakshman sahay Lane, Gurudwara Road, Gaya Nasrigang, Danapur Mahajan Toli, Arha Khem Chand Chaudhary Marge, Patna Patna City Chowk, Patna Hospital Road Siwan Abdul Rahmanpur Road, Didarganj, Patna
2.3.6
The Commission vide letter No. BERC-Tariff-02/11-73 dated 25.01.2012 directed the BSEB to submit the replies/ responses to the suggestions/ objections to the Commission by 7th February, 2012.
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2.3.7
The BSEB prayed for time for submission of written response to the suggestions/ objections made by the consumers/Consumer Associations. The Commission directed the BSEB to submit the same at the earliest.
2.3.8
The BSEB submitted the replies and response to the objections/ suggestions received from these fifteen (15) entities vide BSEB letter no. Com/Tariff/02/2012 302 dated 16th February, 2012 to the Commission. The same has been discussed in detail in the Chapter 3 of this Tariff Order.
2.3.9
Further, the Commission has received Comments and suggestions from consumers/ consumer associations and general public during the public hearing process conducted at Darbhanga, Bhagalpur, Purnia, Gaya, Muzaffarpur and Patna. The list of persons/ organizations whose suggestions/ comments have been received during public hearing at various places is as given in the table below:
Table 3: Additional list of Objectors
Sl.
Name of Consumer/ consumer organizations Darbhanga - 15th February 2012
Address
1 2 3 4 5
Sri Dilip Kumar Jha Sri Pawan Kumar Sureka Dr. Shashi Bhushan Mahto Sri Ajoy Bihari Sri Gyaneshwar Prasad
Secretary, Rural Electric Consumer Association, Loha Madhubani President, Divisional Chamber of Commerce & Industries, Masrat Bazar, darbhanga Secretary, Upvokta Manch, Biraul, Darbhanga Laheria Sarai, Khaja Sarai, Darbhanga General Secretary, Mithilanchal Industrial Chamber of Commerce, Industrial Area, Darbhanga Bhagalpur 23 February 2012
rd
6 7 8 9 10 11 12
Sri Lakhan Lal Prasad Sri sandeep Jha, Advocate Sri Gautam Suman Sri Prakash Chandra Gupta & Others Dr. Jayant Jalad Sri Mutukdhari Agrawal Sri Surendra Kumar Dauania
Manik Sarkar Chowk, Bhagalpur Behind Consumer Court, Bhagalpur Chairman, Ang Uthanodolan Committee, Iswer Nagar, Bisharisthan, Isakchak, Bhagalpur Co-ordination Committee, Bhagalpur Central general secretary, Ang Uthanodolan Committee, Bhagalpur President, Eastern Bihar Industries association, 4 Rai Gopal Sarkar Lane., Bhagalpur Marwari Tola Lane, Bhagalpur
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Sl. 13
Name of Consumer/ consumer organizations Sri Shashi Shankar Rai
Address Laloo Chak, Isakchak, Bhagalpur
Purnia 24th February 2012 14 5 Sri Bimal Chand Bajaria Sri Pankaj Kumar Nayak President, North eastern Bihar Chamber of nd Commerce and Industries, Syndicate Katra 2 Floor Katihar Pankaj International, Maranga, Purnea Gaya 27 February 2012 16 17 18 Sri Brij Nandan Phatak Sri Sandalankara Vikklauk & Kiran Lama Sri Arvind Kumar Secretary, Vidyut Upvokta Sangharse sammittee, 93, Lakshman sahay Lane, Gurudwara Road, Gaya President & general Secretary, International Buddhist Council of Buddhagaya Daijokyo Buddhist Temple, Buddhgaya President, South Bihar Industrial Association, Lharia Tola, Gaya
th
Muzaffarpur 13th March 2012 19 Sri Prakash Narayan Saha General Secretary, Viyahut Seva Trust, Yadupati Marge, Banarash Chowk, Muzaffarpur
Patna 14th March 2012 & 19th March 2012 20 21 22 23 24 25 26 M/s Gangotri Iron and Steel Sri Ajit Prasad Mehta Sri Raj Kishore Sharma Sri Vishwanath Prasad Sri Deo Ratan Prasad M/s Bihar Industrial Association M/s Bholaram Steel Private Limited Bihta, Patna Senior Vice President, Jawan Kishan Morcha, Ara (Bhojpur) Vice President,Lk Kalayan Ayog, Sheoganj, Ara (Bhojpur) President, Bhojpur Chamber of Commerce & Industries, Mahajantoli, Ara (Bhojpur) President,Jan Sangharse Morche, Belwargaj, Patna City, Patna Sinha Library Road, Patna Nasriganj, Digha, Patna
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2.3.10 The Commission vide letter No. BERC-Tariff-24/ 11-237 dated 12th March, 2012 and letter No. BERC-Tariff-24/ 11 (part-1) - 248 dated 15th March, 2012 directed the BSEB to submit the replies/ responses to the suggestions/ objections received in public hearings to the Commission before 19th March 2012. 2.3.11 The BSEB submitted the replies and responses to the objections/ suggestions received from these twenty-six (26) entities vide BSEB letter no. Com/Tariff/02/2012 476 dated 21st March, 2012 to the Commission. The same has been discussed in detail in the Chapter 3 of this Tariff Order for FY 2012-13. 2.4 2.4.1 State Advisory Committee The meeting of the State Advisory Committee to consider the ARR and retail tariff for FY 2012-13 was held on 23rd December 2011. The proceedings of the State Advisory committee is given in Annexure I. 2.5 2.5.1 Public Hearing Clause 19 of BERC (Terms and conditions for determination of Tariff) Regulations, 2007 provides that the Commission shall hold the public hearing(s) to decide on revenue calculations and tariff proposals of the transmission & distribution utilities. Considering the proceedings of the hearing(s) as well as suggestions/objections received in response to the public notice, the Commission shall issue an order communicating its decision on the revenue calculations and tariff proposals to the Transmission or Distribution licensee, as the case may be. 2.5.2 For convenience of electricity consumers and general public across the State, the Commission held the public hearing at following divisional headquarter in the state:
Table 4: Schedule for public hearing
Sl. 1 2 3 4
Name of Place Darbhanga Bhagalpur Purnea Gaya
Time and Date 15 February, 2012 at 11:30 A.M. 23rd February, 2012 at 11:00 A.M. 24 February, 2012 at 11:30 A.M. 27 February, 2012 at 11:00 A.M.
th th th
Venue Conference Hall of Divisional Commissioner, Darbhanga Conference Hall of Divisional Commissioner, Bhagalpur Conference Hall of DRDA Annexe Building, Purnea Conference Hall of Divisional Commissioner, Gaya
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Sl. 5 6
Name of Place Muzaffarpur Patna
Time and Date 13 March, 2012 at 11:30 A.M. 14 March, 2012 at 11:00 A.M. & th 19 March, 2012 at 11:30 A.M.
th th
Venue Conference Hall of Zila Parishad, Muzaffarpur Office of BERC, Vidyut Bhawan- II, Bailey Road Patna
2.5.3
The BSEB was given an opportunity to present its proposal before the Commission and the consumers/Consumers Association who were present at the public hearing. The BSEB presented its case through audio-visual presentation explaining the proposals in the tariff petition for FY 2012-13.
2.6 2.6.1
Structure of the Order This order is organised into the following chapters namely: Chapter 1: Introduction Covers the background of the entire process along with details of the process adopted by the Commission prior to issue of this Tariff Order for BSEB and the approach being adopted therein. Chapter 2: Procedural History - Covers the details of the process of publication of ARR and tariff petition, scrutiny of the data/ information provided by the Petitioner and the process of consultation with public; Chapter 3: Public Consultation Process - Provides a detailed account of the public hearing process, including the comments of various stakeholders, the Petitioners responses and views of the Commission; Chapter 4: True up of FY 2010-11 - Deals with the True up of expenses for FY 2010-11; Chapter 5: Review of FY 2011-12 - Deals with the review of proposed expenses for FY 2011-12; Chapter 6: Analysis of Aggregate Revenue Requirement for FY 2012-13 Deals with the determination of ARR and tariff for FY 2012-13; Chapter 7: Government grant/ revenue subsidy Deals with quantum and treatment of grant/ subsidy from the State Government; Chapter 8: Tariff Principles, Design and Tariff Schedule Deals with tariff principles and approved Tariff schedule for FY 201213; Chapter 9: Status of Directives issued by the Commission - Deals with report of compliance of directives submitted by the BSEB and Commissions observations on compliance and fresh directives;
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Chapter 10: Generation, Transmission, Wheeling Charges and Open Access Charges Deals with the Wheeling Charges and Open Access Charges, and;
Chapter 11: Renewable Purchase Obligation Chapter 12: Annexures
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3 Public Consultation Process
3.1 3.1.1
Introduction The tariff petition evoked response from several stakeholders. In response to the public notice inviting objections/ suggestions of the stakeholders on the petition, a number of consumers/ consumer organisations filed their submissions in writing. Some of these persons also participated in the public hearing held on the 15th, 23rd, 24th, 27th of February12 and 13th, 14th and 19th of March12. Submissions and responses, pertaining to specific aspects of tariff proposal, have been taken into account in the determination of ARR, formulation of an equitable tariff, balancing the interests of various stakeholders, even if they do not find place in the suggestions/ objections of the stakeholders.
3.1.2
The public hearings were held at various locations across the State to ensure maximum public participation wherein stakeholders put forth their comments and suggestions before the Commission in the presence of the Petitioner. There were 152 members of the public who took part in the public hearing process. The list of the participants is attached as Annexure-II to this Order. In course of public hearings, the Commission also allowed persons/representatives of entities who had not submitted prior written representations to express their views on the ARR and tariff petition for FY 2012-13.
3.1.3
The Commission has examined the issues and concerns voiced by various stakeholders in their written comments as well as in the public hearing and also the response of the Petitioner thereon. The comments/ suggestions submitted by various stakeholders in response to the tariff petition, the replies given by the Petitioner and the views of the Commission have been summarized under various sub-heads as below:-
3.2
Stakeholders Suggestions/ Objections, BSEBs Response and Commissions Views
3.2.1
Issue: Delay in filing the tariff petitions and true-up petitions

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M/s Dadiji Steel Limited and Bihar Steel Manufacturers Association have pointed out that the Board has delayed the filing of tariff petitions for FY 2006-07, FY 2007-08, FY 2008-09, FY 2009-10 and FY 2010-11 beyond specified time. True up petition for FY 2006-07, FY 2007-08, FY 2008-09, FY 2009-10 and FY 2010-11 have also been filed quite late. It was pointed out that the true up exercise for FY 2010-11 and review of ARR for the FY 2011-12 has to be done by the Commission before considering the ARR and tariff proposal for FY 2012-13. Petitioners submission The BSEB has prepared its ARR and tariff petition for the FY 2012-13 in accordance with the BERC (Terms and conditions for determination of Tariff) Regulations, 2007 notified by the Commission and the provisions of the Electricity Act 2003. True-up petition for FY 2006-07, FY 2007-08, FY 2008-09 & FY 2009-10 was filed before the Commission by BSEB and order for the same has been issued by the Commission. True up petition for FY 2010-11 & review petition for FY 2011-12 have also been filed before the Commission. Commissions observation The Commission has directed the Board to file true up, review and tariff petitions within specified time limit. The Commission has passed orders on the true up petition for FY 2010-11 and review petition for FY 2011-12 and considered their impact on ARR and the tariff for FY 2012-13. 3.2.2 Issue: Segregated ARR for Generation, Transmission and Distribution functions of BSEB Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce have stated that the Petitioner has to file separate ARR for generation, transmission and distribution business. Petitioners submission Function wise ARR as per annual accounts has been provided in table 40 of the tariff petition. Commissions observation
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The BSEB is an integrated utility of generation, transmission and distribution, and hence the filing of tariff is in accordance with Annexure D of BERC (Terms and conditions for determination of Tariff) Regulations, 2007. The Commission will undertake detailed scrutiny of ARR while approving the ARR for FY 2012-13. 3.2.3 Issue: BSEBs own Generation M/s Balmukund Concast Limited, M/s Dadiji Steel Ltd, Bihar Steel Manufacturer Association and some other consumers/ consumer groups gave suggestions/ objections on different aspects of own generation of BSEB. They pointed that the Board has projected the gross generation of 310 MU in FY 2012-13 which is higher than the past generation trend. The Board has also projected the operational parameters with a view to exaggerate the cost of generation without taking into consideration the norms specified in CERC (Terms and conditions of Tariff) Regulations, 2009 and the norms approved by the Commission. The Petitioner has proposed generation ARR of Rs 571.29 Cr. for net generation of 272.80 MUs which shows that the plant is generating power at abnormally high cost of about Rs 21 per kWh. It was further mentioned that the Board has not provided any specific data for supply of energy from its own generating station mainly from BTPS Unit-7. They suggested that R&M cost should be allowed only after the benefits are passed on to the Consumers. It was stated that the Board has sought approval of Rs 158.13 Cr. as fuel cost for FY 2012-13 and suggested that if there is no generation of electricity and no benefit of such generation is received by the Consumer, the proposed fuel cost for generating station should not be allowed. They also pointed out that there is a continuous lack of improvement in the performance parameters of BTPS and suggested that the Commission should consider the performance standards for projecting the cost of generation from BTPS. Petitioners submission BSEB submitted that at present Unit VII is under shutdown and undergoing Renovation & Modernization work for revival. Dismantling of the Unit VI for R&M work is planned from June 2012 while R&M of Unit VII is expected to be completed by July 2012.
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After R&M the unit will be under stabilization period and hence higher specific oil consumption is requested for BTPS plant. Station heat rate is expected to improve from FY 2010-11 level of 4103 kCal/kWh to 4000 kCal/kWh & 3700 kCal/kWh for FY 2011-12 & FY 2012-13 respectively. Coal price in FY 2010-11 was Rs. 1823 per MT but in recent times it has witnessed steep hike and it was Rs. 3317 per MT in the month of August, 2011. Hence coal price for FY 2011-12 & FY 2012-13 is expected to be higher from the level of FY 2010-11. Other fuel related cost is projected in line with the cost witnessed in FY 2010-11. BSEB submitted that the ARR of generation is Rs. 571.29 Cr. out of which Rs. 413.16 Cr. comprises of fixed costs like employee cost, operation and maintenance expenses, depreciation, interest and finance charges etc. and Rs. 158.13 Cr. are for fuel cost. Even if BSEB shuts down the operation of BTPS, it will continue to incur fixed cost of the power plant. BSEB cannot shut down BTPS as Bihar is a power deficit state. Commissions observation The Commission observes that the Renovation & Modernisation (R&M) process of BTPS is currently underway and the operational parameters will be reviewed thereafter. The Commission expects that after completion of R&M works, plant shall operate at efficient scale at par with other similarly placed generating plants. The Commission has dealt this issue while approving theARR for FY 2012-13 in Chapter 6. 3.2.4 Issue: Capacity Charge of BTPS plant M/s Kalyanpur Cement has pointed out that as per Clause 33 of the BERC (Terms and conditions for determination of Tariff) Regulations, 2007, a generating plant must operate at 80% efficiency (Plant Load Factor/ Availability) to recover fixed charges from the consumers. Further, recovery of capacity/ fixed charges below the level of target availability (80%) shall be on pro-rata basis and at zero availability, i.e., for non-productive assets no capacity charges can be recovered from the consumers based on the principle that inefficiency of the utility should not be passed on to the consumers. BSEB has only one generating asset and out of seven units only Unit no. 6 is functioning at de-rated capacity of 105 MW with PLF of 11.1% (2008-09), 28.78% (2009-10) and projected to be 31% during 2011-12. In such a case BSEB cannot recover any fixed charges for units 1 to 5 and 7 and any other non-
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performing assets and in case of Unit 6 BSEB can recover less than 40% fixed costs related to generation. Petitioners submission BSEB is not recovering any fixed charge for the units which have been permanently shut down. The fixed costs have been claimed for units which are functional. Further the recovery of fixed cost is proposed at PLF approved by the Commission and not 80% as indicated by the objector. The availability factor indicated by the objector is for new units (and of standard size) and not for 110 MW units which have completed their economic life. Commissions observation The Commission observes that the Renovation & Modernisation (R&M) process of BTPS is currently underway and the operational parameters will be reviewed thereafter. The Commission has dealt this issue while approving the ARR for FY 2012-13 in Chapter 6 of this Tariff Order. 3.2.5 Issue: Power purchase cost M/s Balmukund Concast Limited and M/s Gangotri Iron and Steel Company Limited have observed that the Petitioner has projected the Power purchase of 11,931 MU and 14,142 MU at a cost of Rs 4163 Cr. and Rs 5139 Cr. respectively for FY 2011-12 and FY 2012-13. However, the details of the source of renewable energy purchase and short term/ medium term power purchase for FY 2012-13 have not been furnished. It has also been pointed out that the Board has projected very high power purchase cost @ Rs. 3.49 per unit and Rs. 3.63 for FY 2011-12 and FY 2012-13 respectively from various sources. Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industry & Commerce , M/s Dadiji Steel Limited and Bihar Steel Manufacturer Association have stated that during the past decades 85% of the projected power production was never made available to the Board. Accordingly, the projection of 1304 MUs and 3351 MUs of Power availability from additional sources for FY 2011-12 and FY 2012-13 should not be accepted by the Commission. Prof. Pramod Kumar Sharma requested the BERC to do an in-depth analysis of the power purchase costs and requested that details of the same are furnished to general public.
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Petitioners submission BSEB submitted that it has purchased power for the short and medium terms only through open tenders and competitive bidding route. Considering the availability of power from these short and medium term sources at 85% availability factor, additional power purchase has been projected at 1304 MU and 3351 MU for FY 2011-12 and FY 2012-13 respectively. Power purchase through renewable sources: BERC has notified the Renewable Purchase Obligation, its Compliance and REC framework Implementation Regulation 2010, the Sub-clause 4.1 of the regulation states that Every obligated entity shall purchase not less than 1.5%, 2.5%, 4%, 4.5% and 5% of its total energy consumption (total energy input minus T&D losses) during 2010-11, 2011-12, 2012-13, 2013-14 and 2014-15 respectively from renewable energy sources under the Renewable Purchase Obligation or until reviewed by the Commission. Provided that 0.25% out of the renewable purchase obligation so specified in the year 2010-11 shall be procured from generation based on solar as renewable energy source and shall be increased at a rate of 0.25% every year thereafter till 2014-15 or until reviewed by the Commission. BSEB submitted that in compliance of Renewable purchase obligation, its
Compliance and REC framework regulations, 2010 BSEB is required to purchase 2.5% & 4% of the total sales respectively from renewable energy sources. Out of the total Renewable purchase obligation (RPO), 0.5% & 0.75% has to come from solar energy sources for FY 2011-12 & FY 2012-13 respectively. BSEB has options like Renewable Energy Certificates (REC) to meet renewable purchase obligation and BSEB would consider this option to meet its RPO. Short term/ medium term power purchase: Bihar is a power deficit state and BSEB has obligation to serve the consumers. In order to fulfil its obligation, BSEB is expanding its network across the length and breadth of the state. To meet the growing demand of electricity of existing and new consumers, BSEB is purchasing power on short and medium term basis. Power purchase from NTPC: For projection of power purchase cost from NTPC for FY 2011-12 & FY 2012-13, actual plant-wise cost from April 2011 to August 2011 has been considered.
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Power purchase cost: BSEB has projected the power purchase cost for FY 2012-13 on the basis of actual power purchase cost from April 2011 to August 2012. Commissions observation Prudence checks including bills of central generating units have been done by the Commission while approving the power purchase costs. 3.2.6 Issue: Operation and Maintenance expenses (i) Repair and Maintenance (R&M) Expense M/s Kalyanpur Cement Limited, M/s Balmukund Concast Limted and other consumers suggested that the Commission should allow R&M expenses @ 2% of the GFA of the Board in the ARR of FY 2012-13. They also pointed out that the Petitioner has proposed R&M expense of Rs 110.62 Cr. as against the actual of Rs 62.51 Cr. in FY 2010-11 which amounts to 34% cumulative growth w.r.t. the FY 2010-11. (ii) Employee Cost Bihar Steel Manufacturer Association, M/s Dadiji Steel and M/s Balmukund Concast Limited has pointed out that the Petitioner has estimated Rs 933.22 crores towards employee cost which includes Rs 208.59 Cr. towards unfunded terminal liabilities, Rs 18.85 crores for leave encashment and Rs 19.97crores towards gratuity. They suggested that the Commission should be fair enough to prudently check the data with documentary evidence from the records of the Board. (iii) Administrative and General (A&G) expenses It was also observed by M/s Balmukund Concast Limited that the Board has projected the A&G expenses of Rs 76.88 crores for FY 2012-13 against actual of Rs 38.83 crores during FY 2010-11, which is quite high. Petitioners submission Operation and Maintenance expenses consist of employee cost, A&G expenses and R&M expenses. Revised estimate for the employee cost is based on the actual figure of FY 2010-11. The Wholesale price index (WPI) has increased from 130.81 in FY 2009-10 to 143.32
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in FY 2010-11 which is an increase of 9.56%. The Commission had approved escalation of 10% for employee cost in its Tariff Order for FY 2011-12. Considering the same, BSEB estimates that the employee cost will increase by 10% in FY 201112 & FY 2012-13 from the level of FY 2010-11. Further, Over and above the current employee strength, BSEB has plan for additional recruitment in view of the increase in network and number of consumers during the last couple of years. BSEB plans to recruit 1166 employees under various employee categories. BSEB has recruited some employee while recruitment for remaining employees is in progress. Based on the pay scale of various levels of employees, BSEB expects to incur additional cost of Rs. 11.07 Cr. for new employees in FY 2011-12 and Rs. 32.62 Cr. for FY 2012-13. The 3 years CAGR based on the audited data of A&G expenses for the period FY 2007-08 to FY 2010-11 is 12%. BSEB has applied 12% escalation on A&G expenses of FY 2010-11. Thus, A&G expenses for FY 2011-12 & FY 2012-13 are projected at Rs. 45.13 Cr. & Rs. 50.54 Cr. respectively. Capitalization of A&G expense projected for FY 2011-12 & FY 2012-13 is based on the actual capitalization rate of FY 201011. A&G expenses to be capitalized are projected at Rs. 1.64 Cr. & Rs. 1.83 Cr. and thus the net A&G expenses (post capitalization) are projected at Rs. 43.49 Cr. & Rs. 48.71 Cr. for FY 2011-12 & FY 2012-13 respectively. In addition, BSEB expects to incur an additional A&G expense of Rs. 10 Cr. for outsourcing of metering and billing related activities for FY 2011-12 which has been approved by the Commission in the Tariff Order of FY 2011-12. BSEB proposes to outsource all metering and billing related activities for all its consumers in FY 201213 and it has awarded the contract of same. Accordingly the expenses on metering, billing and related activities for FY 2012-13 is expected to be Rs. 28.17 Cr.. The assets of BSEB are old and require regular maintenance to ensure uninterrupted operations. BSEB has been trying its best to ensure uninterrupted operations of the system and accordingly has been incurring necessary expenditure on R&M activities. Further expansion of transmission and distribution system has contributed to increase in R&M expenses. The Wholesale price index has increased from 130.81 in FY 2009-10 to 143.32 in FY 2010-11 which is an increase of 9.56%. Considering the same, BSEB expects that the R&M expenses will increase by 10% in FY 2012-13 over the level of FY 2011-12.
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The Commission in its Tariff Order for FY 2008-09 dated 26th August, 2008 directed BSEB to include water charges & miscellaneous charges under the head R&M expenses and exclude it from the fuel cost head. Accordingly BSEB has included actual water charges & miscellaneous charges under this head and has excluded from the fuel cost head in this petition. It would be relevant to mention here that O&M norms prescribed by CERC in its CERC (Terms and conditions of Tariff) Regulations, 2009 for determination of tariff cannot be made applicable to BSEB as the operating conditions, geography, consumer mix and the roles & responsibilities of central sector organizations differ from those of BSEB. Commissions observation The Commission takes note of the concerns of the objectors. The Commission is of the view that the justifiable and legitimate cost should only be allowed to the Petitioner for its smooth and efficient functioning. The Commission shall undertake prudence checks of all components of O&M charges while approving the costs. This has been dealt while determining the ARR for FY 2012-13 in Chapter-6. 3.2.7 Issue: Capital cost M/s Kalyanpur Cement Limited stated that BSEB has included additional capital cost in its petition without prior approval of the BERC. They made a submission that expenses sought to be capitalized should be disclosed item-wise and unit-wise and productivity-wise to the objectors/ consumers and same may be checked prudently and only the expenses which are productive or available for production should be allowed. They pointed out that the Act and the Tariff Regulations, 2007 provide that separate tariff for generation, transmission and distribution functions is to be determined in two parts capacity/ fixed charges and variable charges. Regulations 34, 50 and 69 of the Tariff Regulations, 2007 define Capital Cost for generation (Thermal), generation (Hydel) and transmission of a utility. Expenditure incurred is subject to prudence check by the Commission and other formalities before being admitted as Capital Cost. The Capital Cost for 2009-10 and 2010-11 have not been admitted after prudence check by the Commission. Petitioners submission
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BSEB has filed the tariff petition as per BERC (Terms and conditions for determination of Tariff) Regulations, 2007. BSEB has provided all the necessary details related to capital expenditure for three functions of BSEB i.e. Generation, Transmission and Distribution in its tariff petition. BSEB has also provided the funding details of the proposed capex along asset capitalization schedule. Further for past years the Commission has considered capital cost as per the audited accounts of BSEB. Commissions observation The Commission has taken into consideration the views of the objectors and will prudently check the data provided by BSEB while approving the capital costs. 3.2.8 Issue: Depreciation M/s Kalyanpur Cement Limited observed that out of seven (7) generating stations run by the Board only one unit (Unit No. 6) is functioning. Therefore, unit No. 1 to5 and 7 are non-productive assets and depreciation cannot be claimed from the consumers in respect of these units. Further, it was pointed out that the recovery of Depreciation of Unit no. 6 should be restricted to actual average PLF. M/s Balmukund Concast Limited stated that the Petitioner has estimated addition of Rs 191.66 (280.66 89.0) crores as depreciation cost for FY 2012-13 over the depreciation cost claimed in FY 2010-11. Huge addition in depreciation cost shows that a considerable amount has been incurred over asset creation in FY 2010-11 and FY 2011-12. The Board should provide documentary evidence to substantiate that the asset has been created in FY 2010-11 and FY 2011-12 and suggested that the Commission should be fair enough to allow the depreciation charges on the basis of actual for the FY 2010-11. Petitioners submission The BSEB submitted that it calculated the depreciation in accordance with the asset base of the BSEB and the asset wise accumulated depreciation. The depreciation has been projected on the basis of allowed depreciation rates and straight line method of depreciation calculation as specified by the Commission in BERC (Terms and conditions for determination of Tariff) Regulations, 2007. As stated earlier no depreciation has been claimed on non-productive assets.
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Commissions observation The Commission shall take into consideration the views of the objectors while approving the costs and depreciation claimed by BSEB will be checked prudently while approving the depreciation in chapter -6. 3.2.9 Issue: Interest and Finance Charges M/s Kalyanpur Cement Limited pointed out that since the loans have a one year moratorium, no interest charges on new loans should accrue during FY 2012-13. However, the petition states Rs 705.72 crores against this head. Further, no interest is payable on state government loans if the Board does not have any surplus after meeting operating expenses. The Board has to pay interest on security deposit taken from consumers, however the interest paid to the consumers is being retained and has been included in the ARR. M/s Balmukund Concast Limited highlighted that the Petitioner has projected Rs 705.72 crores as Interest and Finance charges for FY 2012-13 against Rs 149.01 crore approved by the Commission in Tariff Order for FY 2011-12. It was suggested that the Commission should check the details of the assets created during the current year i.e. FY 2011-12 which will come under use in FY 2012-13. Petitioners submission Interest and finance charges include the interest liability of BSEB for the loans borrowed for capital works. In the past years, BSEB has added significant network to its existing network by expanding in rural areas for which it has borrowed funds from financial institutions. In FY 2012-13, BSEB plans to spend Rs. 4352 Cr. for capital works. Accordingly the interest and finance charges have been increasing steadily owing to the increased capital investment made by BSEB. There has also been commensurate increase in asset base of BSEB as provided in the books of accounts of BSEB. The rates and other conditions of the loans (for interest computation) are strictly in accordance with the terms and conditions of the loan. The State Government as the owner of BSEB has providing BSEB with all possible assistance in meeting its cash losses and funding requirements as per the conditions of central sponsored schemes. BSEB has at times not paid the State Government interest and principal due for the year. However the cost of funds received from the State Government should be considered as part of the ARR and tariff.
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BSEB has not claimed interest paid to consumers for consumer security deposited by them as an item of cost in the ARR for FY2012-13. Commissions observation The Commission will consider the views of the objectors about interest and finance charges while approving the costs on this account. Interest and finance Charges will be considered after prudence check in chapter -6. 3.2.10 Issue: Interest on Working Capital M/s Balmukund Concast Limited and M/s Gangotri Iron & Steel Company Limited have stated that the Petitioners claim of interest on working capital of Rs 211.67 crores for FY 2012-13 is not justifiable as the BSEB has not created any working capital fund. It was also observed that the Board is using employees contribution in . GPF and Group Saving Schemes, security deposit from the consumers and grant from Government as their working capital and so charging interest on working capital is not acceptable. Accordingly, the Commission should prudently check the amount of working capital. Petitioners submission The Board has submitted that it has proposed interest on working capital on normative basis as per the BERC (Terms and conditions for determination of Tariff) Regulations, 2007. Commissions observation The Commission has dealt with the tariff setting process in line with the BERC (Terms and conditions for determination of Tariff) Regulations, 2007. However, wherever deemed necessary, the expenses have been re-examined and approved after proper prudence check. 3.2.11 Issue: Return on Equity Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industry & Commerce, Bihar Chamber of Commerce, M/s Gangotri Iron & Steel Company Limited and M/s Balmukund Concast Limited pointed out that in the petition, BSEB has calculated the return on equity (RoE) by treating its gross fixed assets (net of grants and subsidies) as equity capital, however BSEBs capital
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structure is constituted wholly of debt taken from State Government, Government of India, LIC, REC, PFC and commercial Banks etc. Further, in its last Tariff Order BERC ha rejected the plea of BSEB; thus, the BSEBs request to allow RoE does not have any basis, and so it may be rejected by BERC. Petitioners submission BSEB is an integrated electricity utility constituted under Clause 5, Chapter III of The Electricity (Supply) Act, 1948. BSEB is mainly funded through loans and grants from the Government of Bihar, loans and grants under specialized funding schemes of the Government of India and loans from commercial lending organizations. In states like Jharkhand, Punjab, Chhattisgarh and Kerala, where integrated SEBs like BSEB were / are operational, the Appropriate Commissions have allowed a reasonable return on equity despite the fact they have capital structure which is very much similar to that of BSEB and is mainly funded through loans/ grants from respective State Governments. In view of the above, BSEB has prayed for consideration of a reasonable return of 14% on capital grant provided by the State Government. As BSEB is a Board and not a company so equity contribution can come only by way of grant and not equity. Return on Equity would enable BSEB to contribute its share of funding in various centrally funded schemes. Otherwise it would have to depend upon state government for continuous support. This would limit the ability of BSEB to raise funds for investment in the sector. Hence BSEB has requested to provide reasonable return on the capital provided by the State Government. Commissions observation The Commission agrees with suggestions made by the objectors. Since BSEB does not have any equity base, return on notional equity as proposed by BSEB cannot be allowed. 3.2.12 Issue: Transmission & Distribution Losses M/s Dadiji Steel, M/s Kalyanpur Cements, Bihar Industries Association, Bihar Steel Manufacturers Association, M/s Gangotri Iron & Steel Company Limited, Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industry & Commerce, North Eastern
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Bihar Chamber of Commerce and Industries, Eastern Bihar Industries Association and M/s Patwari Steel Private Limited have objected to T&D loss trajectory as proposed by the Board for FY 2012-13. T&D loss projected by the Board is 42% for the FY 2011-12 and 41% for the FY 2012-13 as against the Commissions target of 29% for FY 2011-12 and 27.5% for FY 2012-13. The stakeholders also submitted that the Commission should take strong action against the Board for their ineffectiveness in reducing T&D losses as the consumers have to suffer for the inefficiency of the Petitioner. They further stated that the approval of higher T&D loss than what is actual for the HT consumers would result into indirect cross-subsidy and will also impose additional burden on a HT consumers. M/s Bal Mukund Concast Limited stated that the actual technical line loss right from the transmission system upto the level of distribution is normally 12% to 14% of the total energy fed into the system and suggested that the Commission should give target to achieve T&D loss level of 14% by FY 2017-18. The Consumers during the public hearing stated that the Board should make all-out effort to bring down its T&D losses. They stated that the Board should provide the road map for loss reduction. Petitioners submission The Board submitted that the Commission in the Tariff Order for FY 2011-12 had restated the T&D loss levels for BSEB on account of reassessment of sales based on restricted hours of supply. The T&D loss levels were fixed at 29%, 27.5% and 26% for 2011-12, 2012-13 and 2013-14, respectively. The Commission had restated norms of unmetered consumption for Kutir Jyoti connections in rural areas from 30 units per month to 18 units per month and Agriculture connections from 2000 units per annum to 1485 units per annum. Such restated consumption norms are not reflective of the actual consumption by these categories and is adding to the T&D losses of the BSEB. On account of the high level of T&D losses and the disallowances of costs in the previous Tariff Order issued by the Commission, BSEB is incurring substantial financial loss. Consequently there have been occasions when it has not able to meet the cost of power purchase and O&M expenses. This is also adversely affecting the
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BSEBs ability to undertake network improvement/ extension and loss reduction works. Accordingly, BSEBs ability to reduce losses in the FY 2011-12 and FY 201213 have been restricted and the losses have remained at the 44% level as recorded in FY 2010-11. Hence BSEB has filed the ARR petition based on actual loss level. BSEB further submitted that it is making sincere efforts to reduce distribution losses by providing meters to unmetered consumers, undertaking network up-gradation/ improvement projects and undertaking R-APDRP projects in selected towns. BSEB has also been engaged in conducting raids in theft prone areas to catch unscrupulous consumers and curb malpractices adopted by such consumers. However, even after such concerted efforts, the losses of BSEB have not come down owing to the fact that a large number of consumers (approximately 27 lakhs) are being added in the rural areas under BPL connections under RGGVY scheme. Substantial expansion of the network in rural areas has also led to increased exposure of network to pilferage/theft. Hence the losses have not come down even after concerted efforts by BSEB. Commissions observation The Commission fully agrees with the views of the consumers and feels that the Petitioner has failed to show improvement in the T&D loss reduction. The Commission does not find any merit in passing on the inefficiencies of the Board in the past and present to the consumers beyond the loss levels approved by the Commission. Therefore, the Commission has also decided to continue with the trajectory approved in its Tariff Order for FY 2011-12. The Commission has also given directives to the Petitioner for submission of a detailed T&D loss reduction road map so that the Petitioner is able to achieve the trajectory as laid down in the previous Tariff Orders. 3.2.13 Issue: Non-Tariff Income M/s Balmukund Concast Limited has observed that the Petitioner has projected the non - tariff income of Rs 55.11 Cr. only for FY 2012-13 as against Rs 168.23 Cr. approved by the Commission for FY 2011-12. Also, the Board has purposely kept the non-tariff income at lower level for FY 2012-13 to increase the revenue gap and this has no basis. Petitioners submission
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The BSEB submitted that it has not proposed DPS and interest on investment as part of non- tariff income. The detailed justification for the same is provided in point no. 2.23 of tariff petition for FY 2012-13. Commissions observation The Commission will consider the views of the objectors about Non-Tariff income while approving the costs. While 5% of DPS reflected in the accounts as recoverable has been considered as non tariff income, carrying cost of DPS has allowed as cost. 3.2.14 Issue: Government grant and subsidy M/s Dina Iron & Steel, Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce submitted that the Government grant should not be used to cover higher T&D loss of BSEB. From the very beginning Government grant is being paid directly to NTPC and is meant for power purchase. ARR and tariff till date have been fixed taking Govt. grant as resource gap grant; and the reason behind increasing the Govt. grant from Rs. 60 Cr. to Rs. 90 Cr. was the increase in power purchase cost due to use of imported coal by NTPC. It was also stated that the Government cannot use public money to finance inefficiency and theft. Such a practice, if allowed will lead to higher inefficiency and purpose of tariff fixation will be defeated. M/s Balmukund Concast Limited objected to the Boards proposal to consider only Rs 124.26 Cr. as State Government subsidy to consumers. It was suggested that the Commission should take into consideration the full amount of the grant received from State Government for the purpose of subsidy to consumers. Petitioners submission It is here necessary to take into consideration that the BSEB is owned by Government of Bihar. Any financial losses incurred by BSEB should be compensated by owner of BSEB. The Commission has also appreciated this fact in its Tariff Order for FY 2011-12 dated 1st June, 2011, while disallowing the request of BSEB for refixing higher T&D loss reduction trajectory and observed that if BSEB is not able to meet loss reduction trajectory due to implementation of Government sponsored RGGVY scheme, then it should ask the State Government for subsidy to compensate for the increased T&D losses.
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Treatment of resource gap funding is done on the basis of direction received from Energy department of the Government of Bihar. The State Govt. has clarified that the resource gap funding will be first used to compensate BSEB for financial losses arising on account of consideration of normative T&D losses as against actual T&D losses. Remaining amount of resource gap funding will be used for subsidizing agriculture and rural consumers. State Government grant provided for replacement of meter and conductor is capital grant and not revenue grant. From the capital grant provided by State Government, assets are created based on the purpose for which grant is provided. Commissions observation The objections by the objectors and response from the Board are noted. The Commission has addressed the issue related to Government grant and subsidy in detail in this tariff Order. Government grant has been treated as per the clarification issued by the State Government in this regard. 3.2.15 Issue: Tariff rates According to Bihar Chamber of Commerce the BSEB has proposed sharp tariff hike for all consumers, particularly industrial consumers which is agains the norms and objective of tariff fixation. Central Bihar Chamber of Commerce, South Bihar industries Association, Vidyut Upboghta Sangarsh Samiti, Eastern Bihar Industries Association have opposed the proposed tariff hike for FY 2012-13 in fixed charges, energy charges and miscellaneous charges. It has been pointed out that the Board has proposed around 50% tariff hike for FY 2012-13 which will create an extra burden on the consumers across all the consumer categories which is not justifiable. Shri Doman Singh, was of the view that there has been a substantial increase in demand and energy charges for the domestic consumers below and upto 5kW single phase supply as well as for domestic consumers with 5kw and above three phase connection. He quoted tariff schedules of Haryana and Gujarat, highlighting that the fixed charges in these states for domestic consumers is at concessional rates. The Consumers also suggested that since BSEB is already charging fixed cost in the shape of fixed charges, separate development charges should not be allowed.
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Petitioners submission The Board submitted that tariff has been proposed in view of the increase in various cost components and gap between ARR and revenue from projected sale at existing tariff. BSEB has worked out its ARR Requirement based on the BERC (Terms and conditions for determination of Tariff) Regulations, 2007. The Petitioner has given reference to Clause 8.3.21 of the Tariff Policy and submitted that conditions of other States vastly differ especially in respect of own generation and power purchase mix, thermal & Hydel mix, deficit/surplus in power, consumer mix and cost mix. The tariff rates in Bihar are therefore not comparable with other States without consideration of these inputs to the sector. The BSEB further submitted that it has to incur fixed and variable costs for its operations. Fixed charges are levied for recovery of fixed costs and energy charges are levied for recovery of variable costs. Proposed increase in fixed charge reflects the increase in fixed costs of BSEB. Prudent tariff structure is required for the recovery of fixed charges and variable charges. For FY 2012-13, BSEB has proposed total ARR of Rs. 7898.13 Cr. out of which Rs. 2600.51 Cr. are of fixed nature while Rs. 5297.61 Cr. will be used for power purchase and fuel cost of own generation. Currently, BSEB is able to recover only Rs. 687 Cr. & Rs. 1109 Cr. working out to 26% & 43% of fixed costs from demand/fixed charges based on the existing tariff & proposed tariff respectively. BSEB further submitted that the proposed changes in tariff are as per the cost incurred by BSEB in providing these services. Any income earned from this will ultimately passes on to consumers by way of reduced ARR. Development Charges are being proposed for recovery of cost incurred by BSEB while providing new connection. Cost is proposed to be recovered one time only as development charges. Commissions observation
For achieving the objective that the tariff progressively reflects the cost of supply of electricity, the SERC would notify roadmap within six months with a target that latest by the end of year 2010-2011 tariffs are within 20 % of the average cost of supply. The road map would also have intermediate milestones, based on the approach of a gradual reduction in cross subsidy Bihar Electricity Regulatory Commission Page 39
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The Commission has endeavoured to allow a reasonable and balanced tariff in this order keeping in view practical and operational aspects and constraints. While the Commission has endeavoured to determine the tariff to meet the ARR of BSEB, lower tariff for smaller consumers and gradual reduction in cross-subsidy has also been done. 3.2.16 Issue: Minimum Monthly Charge (MMC)/ Annual Minimum Guarantee (AMG) Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industry & Commerce, Bihar Steel Manufacturers Association, Kalyanpur Cements, M/s Gangotri Iron & Steel Company Limited and M/s Dadiji Steel limited have stated that in Tariff Order for FY 2011-12 the Commission was of the view that MMC needs to be gradually phased out. Further, it was stated that the Commission was of the view to convert MMC to Annual Minimum Guarantee in some of the HTS category to facilitate the consumers to cover the consumption in one financial year. It was also suggested that the Commission should not provide any Annual Minimum Guarantee/ Monthly Minimum Charges (AMG/ MMC) in the Tariff Order and if it is at all provided, proportionate reduction both in demand and energy charges be allowed by the Commission if the hours of supply is less than committed hours of supply by the Board. Bihar Steel Manufacturers Association, Bihar Chamber of Commerce, M/s Balmukund Concast Limited and M/s Gangotri Iron & Steel Company Limited have pointed out that the Petitioner has proposed a demand charge of Rs 900/KVA/ month for HTSS consumers which is too high demand charges and has no basis. They were of the view that the demand charge to HTSS consumer be kept at par with that of Jharkhand. M/s Gangotri Iron and Steel Company Limited has suggested that the provision of fixing contract demand on the basis of 600 KVA per MT should not be allowed and the consumer should be allowed to contract as per their requirement which is recorded in the electronic meter and not on the basis of the connected loads of induction furnaces. M/s Gangotri Iron & Steel Company Limited and M/s Bal Mukund Concast Limited were of the view that demand charge for most of the HT consumers is taken as 85% of the contract demand, however, in case of HTSS consumers the demand charges are 100%, and no basis has been given for the discrimination. Petitioners submission
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MMC is a normally accepted practice in many states in the country and the BSEB accordingly prayed for consideration of the Commission. This has already been settled in the appeal made against the Tariff Order issued by BERC for the FY 200809 by the Hon'ble APTEL. For FY 2012-13, BSEB has proposed total ARR of Rs. 7898.13 Cr. out of which Rs. 2600.51 Cr. are of fixed nature while Rs. 5297.61 Cr. will be used for power purchase and fuel cost of own generation. Currently, BSEB is able to recover only Rs. 687 Cr. & Rs. 1109 Cr. working out to 26% & 43% of fixed costs from demand/fixed charges based on the existing tariff & proposed tariff respectively. In such scenario, it is very much necessary to levy MMC on consumers so that BSEB can at least recover its fixed cost. Further, The Objector is not burdened by MMC as Government of Bihar is assisting them under Bihar Industrial Policy 2011. If the actual consumption during a month falls below MMC the State Govt. will compensate BSEB with the equivalent amount, on behalf of the consumer. The Board submitted that the method of billing for HTSS consumers is based on the decision taken at the time of creation of this category with mutual consent of the BSEB and the representatives of Bihar Steel Manufacturer Association. This matter was raised during earlier tariff proposals and was settled in the last Tariff Order of the BERC. The contract demand on the basis of 600 KVA/MT capacity was the original basis taken into consideration for creating new category of HTSS and the same method is in use for more than 10 years. However, new HTSS units have been allowed to have contract demand as per technical specification of the machineries. The Commission has already agreed to follow the practice of other SEBs to fix the contract demand as per technical specifications in respect of new units. Conditions of other States vastly differ especially in respect of generation and power purchase mix, deficit/surplus in power, consumer mix and cost mix. The tariff rates are therefore not comparable with rates in other States without consideration of sector inputs. BSEB stated that the objective of providing for demand charge is to ensure efficient network utilization. Considering that BSEB has installed large infrastructure for distribution of energy, for the upkeep of which it incurs costs like depreciation, interest cost, R&M and O&M costs etc., The consumers should utilize the network to
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an optimal level failing which BSEB will not be able to recover its returns on investment and other fixed costs. Hence in order to ensure recovery of the returns on investments and other fixed costs, a demand charge is proposed to be levied. Further this is an accepted practice in most of the states in the country and BSEB has accordingly prayed for consideration of the Commission. This issue has already been settled in the appeal made against the Tariff Order issued by BERC for the FY 2008-09 by the Hon'ble APTEL. As per Section 45 (2) of the Electricity Act 2003 (2) The charges for electricity supplied by a distribution licensee shall be (a) fixed in accordance with the methods and the principles as may be specified by the concerned State Commission; (b) published in such manner so as to give adequate publicity for such charges and prices. (3) The charges for electricity supplied by a distribution licensee may include (a) a fixed charge in addition to the charge for the actual electricity supplied; (b) a rent or other charges in respect of any electric meter or electrical plant provided by the distribution licensee. (4) Subject to the provisions of section 62, in fixing charges under this section a distribution licensee shall not show undue preference to any person or class of persons or discrimination against any person or class of persons. (5) The charges fixed by the distribution licensee shall be in accordance with the provisions of this Act and the regulations made in this behalf by the concerned State Commission. Commissions observation The Commission has noted the objections and response and has taken appropriate decision in this regard. On the issue of MMC, the Commission is of the view that it needs to be gradually phased out. Accordingly, AMG for HT consumers has been done away with in FY 2012-13. 3.2.17 Issue: Tariff rebates Rebate for timely payment: The Petitioner has proposed a rebate of ten (10)
paise/unit for LT consumers and one (1) paise / unit for HTSS consumers for paying energy bills on or before due date of payment. Some HT Consumers suggested that same rebate of ten (10) paise/ unit as being allowed to L.T. consumers should be
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allowed to HTSS and HT consumers, so that there may not be any discrimination among various classes of consumers of LT and HT. Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce have suggested to introduce Advance Payment as an option for security deposit and interest paid on such advance payment should be equal to DPS charged from customers. Load factor rebate: The Consumers have opposed the Petitioners proposal to withdraw the rebate for higher consumption on excess units consumed and suggested that the load factor rebate should be allowed in line with the earlier Tariff Orders for FY 2008-09 and FY 2010-11. Power Factor rebate: M/s Balmukund Concast Limited have suggested to allow the rebate for improvement in power factor over 0.9. Bihar Chamber of Commerce has stated that power factor goes down due to frequent trippings and inferior quality of power supply. Further, they stated that there should be no penalty for power factor between 0.85 and 0.90. Petitioners submission Prompt payment rebate: It is responsibility of consumer to pay bill in time and for the discharge of this responsibility consumer requires no incentive. On Advance Payment: Interest on Advance payment and DPS cannot be treated in the same manner. DPS is charged as penalty and hence it has higher rate of 18% per annum. Load Factor rebate: BSEB submitted that it does not see any merit to continue the load factor rebate. Bihar is a power deficit state, at current scenario BSEB is procuring power through short term and medium term sources to meet the increased demand of the state. The cost of procuring power from such sources is high and therefore increased consumption results in increased power purchase cost for BSEB. The load factor rebate is against the conservation of power and it may increase the power purchase cost. The under recovery of cost will get reflected in higher rate for other consumer categories. Power Factor Rebate: Higher power factor helps in reducing losses and improve system voltage so it is the responsibility of all consumers to improve power factor.
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The consumers of the state have taken steps to improve system and in this context the proposed power factor rebate is appropriate. Neighbouring states are also giving power factor rebate at higher power factor as compare to Bihar. Power factor rebate is given at 97%, 95%, 95% & 92% by Orissa, Madhya Pradesh, Uttar Pradesh & West Bengal respectively.. Commissions observation The Commission has taken into consideration the views of the objectors and response of the Petitioner and allowed different types of tariff rebates accordingly. 3.2.18 Issue: Supply at premium rate M/s Dadiji Steel Limited and Bihar Steel Manufacturers Association have stated that it is statuary obligation of the Board to supply electricity continuously according to the needs of the consumers and for which they cannot charge premium tariff under any circumstances. Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce have stated that it is highly unlikely that the Board would be able to ensure uninterrupted power supply even in so called premium supply areas. They also added that under the present field conditions, first norms should be fixed as to what constitutes premium supply. Further, Bihar Chamber of Commerce opposed the Boards proposal of defining premium supply as supply of 600 hours in a month. It was also suggested that in case the supply hours of the premium area falls below 24 hrs. a penalty should be imposed on the Petitioner. Petitioners submission As directed by the Commission in its Tariff Order for FY2011-12, BSEB has proposed a Supply Premium to be payable by consumers who receive additional hours of supply as compared to other consumers. It is proposed that all LT consumers except Kutir Jyoti and Agricultural and HTS I consumers who lie in such areas which will receive continuous supply atleast for 600 hours in a month will be required to pay additional 10% on demand/fixed and energy charge and in MMC as supply premium. The continuous supply mean normal supply excluding the duration of grid failure, plant failure of power supplier, any force majeure condition, scheduled shut down,
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emergent breakdown and restriction of power supply by the Commission under section 23 of Electricity Act, 2003. Which provides inter-alia 23 Directions to Distribution Licensee: if the appropriate Commission is of the opinion that it is necessary or expedient so to do for maintaining the efficient supply, securing the equitable distribution of electricity and promoting competition, it may, by order, provide for regulating supply, distribution, consumption or use thereof . Areas to which BSEB intends to supply electricity close to 600 (six hundred) hours will be notified by BSEB and the proposed Supply Premium will be levied after such notification. Commissions observation The Commission has noted the views of objectors and response from the Petitioner. However, the Commission has already specified in the Tariff Order for FY 2011-12 that 10% premium on demand/fixed and energy charge and in MMC tariff shall be applicable to the consumers in the areas where BSEB intends to supply electricity close to 24 (twenty four) hours. Such areas shall be notified by BSEB and the premium shall be levied after notification of such area by BSEB. Commission also clarifies that the Petitioner can charge premium over the normal tariff from consumers of such areas getting nearly 24 hours of supply from 33kV or 11 kV feeders to all LT categories and 11 kV categories except Kutir Jyoti and Agricultural consumers who will be subsidised by the Government. The continuous supply shall mean the normal supply excluding the grid failure, any force majeure condition, scheduled shut down and emergent breakdown. 3.2.19 Issue: ToD Tariff Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce have stated that the TOD tariff should be made beneficial to consumers, so that more and more consumers voluntarily opt for it. The present ToD tariff acts as a dis-incentive to the Consumers as they are charged 20% extra during peak hour while the discount during off-peak period is only 15%.
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Petitioners submission Time of Day (TOD) tariff, is recognized globally across electricity industries, as an important Demand Side Management (DSM) measure for incentivizing consumers to shift a portion of their demand from peak to off-peak period, thereby improving the system load factor by reducing the demand during the peak period and reducing the requirement to purchase costly power during this period. The table below presents the status of TOD tariffs as implemented in various states of the country:
Table 5: Status of TOD tariff implemented in various states
States Assam Chhattisgarh Jharkhand Kerala Madhya Pradesh Tamilnadu Tripura Uttaranchal Assam
Peak Hours 160% 130% 120% 130% 130% 120% 140% 125% 160%
Off Peak Hours 83% 85% 85% 85% 90% 95% 60% 95% 83%
Further, BSEB would like to state that the TOD tariffs as applicable in most of the states (Maharashtra, West Bengal, HP, MP, Gujarat, Uttarakhand, UP, Kerala, Tamil Nadu, and Tripura) are mandatory for HT and EHT Consumers. Commissions observation The Commission has noted the views of the objectors and response from the Petitioner. The Commission is of the view that gradually TOD tariff should be made mandatory. 3.2.20 Issue: Open Access M/s Dadiji Steel Limited, Bihar Steel Manufacturers Association stated that the Board should be directed to provide the open access facility to its high tension supply consumers, who had given notice to them for providing open access. M/s Gangotri Iron and Steel company Limited has highlighted that as per notification issued by Ministry of Power vide No. 23/01/2008 RXR (Vol IV) dated 30.11.2011,
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the consumer having contract demand of one (1) MW and above are to be deemed as open access consumers and the SERC does not have to determine the tariff of such consumer treating them as open access Consumer. It has been suggested that the Commission should determine the tariff for HTSS consumer treating them as open access consumer and shall specify the stand by charge in respect of demand charge. Petitioners submission There is separate regulation issued by the BERC for Open Access, which governs issues related to open access. The same cannot be deliberated in the present tariff petition. Commissions observation The Commission would like to encourage Open Access to consumers. While cross subsidy surcharge has been retained at the level of FY 2011-12 at 50% of the value specified in Tariff policy, other terms and conditions of open access will be considered in Open access regulations. 3.2.21 Issue: Seasonal Tariff Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce have suggested that the tariff rates should be rationalised in view of the State Government Policy to encourage and invite fresh investment in sugar mills, rice mills and cold storages etc. which operate during certain period of the year. i.e having seasonality of operation. Petitioners submission BSEB submitted that it has proposed the changes in Seasonal tariff based on the marginal cost of power procurement of the Board. Commissions observation The objections and response are noted by the Commission and has been dealt in Chapter 6 of this Tariff Order. 3.2.22 Issue: Special Plea: Railway Traction tariff
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Senior Divisional Electrical Engineer (East Central Railway, Danapur) stated that the Boards tariff for Railway traction has been unreasonably and disproportionately high. He stated that the Board has revised the traction tariff 4 times since 2001 which has risen by 113.96% taking into considering the current Boards proposal for FY 201213. In the objections raised by the East Central Railway representative It was pointed out that the Board Average Cost per unit is higher than JSEB, UPPCL and DVC. The Objectors has opposed the Boards proposal for imposing penalties on exceeding the Contract Demand at Railway TSS as this is mainly due to various external factors which are beyond the control of Railways. Senior Divisional Electrical Engineer (East Central Railway, Danapur) has also opposed the Boards proposal that the Transformer Capacity of HT Consumer (RTS) shall not be more than 200% of the Contract Demand. He has requested the Commission to exempt the RTS from the Boards Terms and conditions and allowing them to use the RDSOs standard designed Transformer Capacity. The objector refered to Article 287 of the constitution and stated that the Power tariff for the Railways should be reasonable and should not be very different from the actual cost incurred by the supply companies for the generation and distribution of Power. The Objector has also requested the following to the Commission:a) The Billing demand should not be taken as maximum demand recorded during the month or 75% of the Contract Demand. b) Load factor rebate for calculating base energy should be 25%. c) Power factor rebate should be as per existing norms. Petitioners submission BSEB submitted that Bihar has different consumer mix, power purchase cost and fixed costs so Electricity tariff in Bihar cannot be compared with other states. BSEB has proposed tariff average tariff hike of 56.77% but for railways it has proposed only 36.79% tariff hike. Average Revenue realisation as compare to Cost to Service is 89% and that is same as approved by the Commission in its Tariff Order for FY 201112. The Board submitted the following response over the issues raised by Railways representatives:
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a) Abnormal hike in railways traction tariff: Proposed tariff hike is as per revenue requirement of BSEB and reflects the cost of supply of electricity. b) Penalty for exceeding contract demand: The Contract demand allowed to Railways forms a part of the contract between railways and BSEB. It is logical to include as a part of the contract provisions for redressal of violation of the contract conditions. The penalty for demand violation is a part of such provisions. Further similar penalty provisions have been provided for contract demand violation by other HT consumer categories. It would be against the natural justice to treat consumers differently for violation similar conditions of contract. Further if the consumers are allowed to draw power from the grid without any restriction on demand, this would detrimental for grid security, safety of local network and would inhibit planning of power purchase. c) Transformer capacity: Relaxation in this regard have been provided to Railways over conditions able to other HT categories, while other HT category cannot have transformer capacity more than 150% of contract demand whereas Railways can have transformer capacity equal to 200% of contract demand. Further Railways are entitled to have a standby arrangement of equivalent capacity. If the Railways require transformer of higher capacity then they can request BSEB for increase in contract demand. d) Billing demand: The request of Railways cannot be accepted as the treatment in this regard has to be at par with treatment to other HT consumers. e) Load Factor: BSEB has realised that most of the TSS connections of railways are having load factor of more than 50%, keeping this in view the load factor of 50% has been proposed in this tariff petition. Since Railways is maintaining load factor of more than 50% BSEB does not see this as a cause of concern for Railways. f) Power factor rebate: Higher power factor helps in reducing losses and improve voltage so it is responsibility of consumer to improve power factor and to encourage consumer to maintain high power factor such tariff structure is being proposed. Neighbouring states are also giving power factor rebate at higher power factor as compare to Bihar. Power factor rebate is given at 97%, 95%, 95% & 92% by Orissa, Madhya Pradesh, Uttar Pradesh & West Bengal respectively.
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Objectors rejoinder over Petitioners submission The Objector stated that the Railway is public serving organisation. Hike in Railway traction tariff by 36.79% in one year will affect the E.C. Railways economic condition. He stated that the load of Railway is of fluctuating nature and load increase in a traction feeding zone for a short period i.e. 15 to 30 minutes. This leads to increase in maximum demand. Over Transformer capacity issue the objector stated that Transformer capacity is of 21.5 MVA a standard design based on RDSO specification. It is designed to feed the minimum two feeding Zone so that the train operation may not be interrupted in case of failures. The Objector again replied to the Boards response and opposed the Boards proposal pertaining to Billing Demand, Load factor issue and Power factor rebate. Commissions observation The Objections and response from the Board are noted. The Commission is of the view that Article 287 of the Constitution provide expemtion from taxes on electricity. As per the Article 287 of the Constituion: , no law of a state shall impose, or authorise the imposition of, a tax on the consumption or sale of electricity (whether produced by a Government or other persons), which is a) Consumed by the Government of India, or sold to the Government of India for consumption by that Government; or b) Consumed in the construction, maintenance or operation of any railway by the Government of India or a railway company operating that railway, or sold to that Government or any such railway company for consumption in the construction, maintenance or operation of any railway,. The Commission will take a rational reasonable view while determining tariff and other terms and conditions of supply for Railways Traction Services. However, the Commission does not agree to the proposal of increasing the billing demand and load factor.
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3.2.23 Issue: Matter related to Electricity Supply code Bihar Chamber of Commerce, Bihar Industries Association, Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industries and Commerce, M/s Gangotri Consumers have suggested if the Petitioner wants any change in the provisions of Bihar Electricity Supply Code, suitable amendment may be sought in the court. Further, it has been pointed out that there are various other changes proposed by the Petitioner such as voltage surcharge, Security deposit, accounting for partial payment, load factor and penalty for RTS, transformer capacity, cap on overall rebate, withdrawal of rebate, tatkal connections, notice period for disconnection, removal of any MMC or Fixed charge etc. All these changes proposed by the Petitioner should be considered by way of amendment in Electric Supply Code. It was suggested that the same should be dealt with separately and should not be a part of tariff fixing exercise. Petitioners submission In this regard, no specific response has been provided by the Board. Commissions observation The Commission is also of the view that generally the terms and conditions of supply which are part of Electricity Supply Code should be considered through amendment in the code and no revision should be made in the provision of Electricity Supply code in the Tariff Order. 3.2.24 Issue: Security Deposit M/s Kalyanpur Cement Limited, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce objected to the proposal of the Petitioner for enhancing the security deposit to the level equivalent to estimated energy charges of three months. M/s Balmukund Concast Limited has pointed out that the Boards proposal is contrary to the provisions of Bihar Electric Supply Code, 2007. Moreover, the Board is not investing the amount deposited by the consumers appropriately like in fixed deposit or in capital works. Petitioners submission As per the Bihar Electricity Supply Code, 2007 the deposit shall be accepted in the form of cash, cheque or draft in case of LT consumers and in the form of draft or
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bankers cheque in case of HT consumers. Also as per the Code the distribution licensee shall pay interest, at the bank rate notified by the Reserve Bank of India from time to time on such security deposits taken from the consumers. Moreover, cash security deposit is taken because the supply to the consumer is given initially on credit basis. The cash is required to meet the monthly expenditure on revolving basis to provide electricity to consumer. This is also in-line with the Section 47(4)2 of the Electricity Act 2003. BSEB has proposed to increase the initial security deposit of the consumer (except Kutir Jyoti rural and Kutir Jyoti urban) equivalent to the estimated energy charges including fixed/demand charges for a period of three months as per the Tariff Order issued by the Commission for FY 2006-07. This takes into consideration the time involved in the process of Consumer meter reading till the receipt of the payment of the bill by the consumers. This is further supported in case of realization of payment through cheques. Any concessional funding provided by consumers helps BSEB in reducing the cost of supply which ultimately benefits the consumers of the state. The interest rates suggested by the objector for paying interest to the consumers for their security deposits will increase the cost of supply which will ultimately result in increase in tariff rates. Commissions observation The apprehension of the objector and the response of the Petitioner are noted. The Commission support the view of the consumers. 3.2.25 Issue: Adjustment in case of partial bill payment Bihar Industries Association has raised objections against the proposed adjustment in case of partial bill payment as this infringes section 56 of the Electricity Act, 2003. It was suggested that consumer should have the option to decide the order of adjustment against various dues incase of partial payment. Petitioners submission
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BSEB submitted that the adjustment in case of partial bill payment is proposed based on the statutory requirement and occurrence of liability. In case of partial payment made by the consumer the adjustment of the payment made by him will be done in the following order: 1) Statutory taxes and duties, 2) Additional Security, 3) DPS on arrears, 4) Principal arrears and 5) Current bill. Commissions observation The objections and response are noted by the Commission. This matter has been dealt in chapter -8 of the Tariff Order. 3.2.26 Issue: Delayed Payment Surcharge (DPS) M/s Balmukund Concast Limited, Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce opposed the Boards proposal of DPS @ 1.5% per month or part thereof if the bill in full is not paid before the due date specified in the bill for all categories of HT and HTSS consumers. It was suggested that the DPS to be levied for HT and HTSS consumer on daily basis @ 0.025% per day, on the Principal Outstanding of the bill. M/s Kalyanpur Cement and M/s Patwari Steel Private Limited suggested that the Board should keep a separate account of DPS/ surcharge for separate different heads like energy bill, electricity duty, arrears, DPS, surcharge etc. They suggested that no DPS should be charged, after the line is permanently disconnected. Petitioners submission The Board submitted that as per the existing terms and conditions the consumer is required to pay surcharge on the entire principal amount even if the consumer has made partial payment. BSEB has proposed to replace the word principal with balance so that the consumers who pay partial bill amount will be required to pay DPS only on the remaining amount and not the entire amount. This would incentivize consumers to pay their bills (even partial) and help BSEB in improving its cash collection. This change is being proposed for both LT and HT consumer categories. Further BSEB submitted that DPS is a penalty for not paying bills in time and it should be higher than the state bank prime lending rate (the cost of fund) and also a component for penalizing the consumer for default. Currently, state bank advance
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rate is 14.75% compounded annually, so simple interest rate of 18% per annum of DPS is justified. Commissions observation The Commission is of the view that DPS @ 1.5% per month is reasonable. 3.2.27 Issue: Power Factor Surcharge and Voltage Surcharge M/s Kalyanpur Cement and M/s Patwari Steels Private Limited have stated that with reorganisation of the then existing Bihar into Bihar and Jharkhand, the Board has been left with majority of low tension consumers who constitute 85% of the BSEBs present load. Thus the industries are finding it difficult to maintain a good power factor. Representative of Vidyut Upbhokta Sangharsh Samiti has also suggested the voltage surcharge at rate of 7.5% is not justifiable and should not be allowed. Petitioners submission The Board submitted that higher power factor helps in reducing losses and improve system voltage. So it is the responsibility of all consumers to improve power factor. The consumers of the state have taken steps to improve system and in this context the proposed power factor rebate and surcharge is appropriate. On voltage surcharge issues the Board stated that it would like to incentivize consumers to receive supply at higher voltage levels. Receiving supply at higher voltage level is beneficial to both consumers and BSEB. By taking supply at higher voltage level, Consumers receive better quality and reliability of supply whereas BSEB is able to control its losses and system overloading. Single and three phase tariff is kept same for smooth processing. Commissions observation The objection by objectors and response from the Board has been noted by the Commission and the same has been considered during the examination of tariff petition for FY 2012-13. 3.2.28 Issue: Compliance of Directives Consumers have raised the issue of non-compliance of directives of the Commission given in its Tariff Orders of different financial years.
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Petitioners submission BSEB submitted that it has made efforts to comply with the various directives issued by the Commission from time to time. The Status of compliance of each directive has been given in the tariff petition submitted by the BSEB. Commissions observation The compliance report of directives submitted by the Petitioner has been reviewed in Chapter -9 of this Tariff Order. 3.2.29 Issue: Voltage wise cost of supply Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industry & Commerce, M/s Balmukund Concast Limited, M/s Kalyanpur Cement Limited and M/s Patwari Steel Limited suggested that the Commission should ensure that determination of tariff/ revision of tariff should not be allowed without taking into account the voltage-wise cost of supply of each category of consumers. Petitioners submission As per Section 62(3) of the Electricity Act 2003, The Appropriate Commission shall not, while determining the tariff under this Act, show undue preference to any consumer of electricity but may differentiate according to the consumer's load factor, power factor, voltage, total consumption of electricity during any specified period or the time at which the supply is required or the geographical position of any area, the nature of supply and the purpose for which the supply is required. Also, clause 8.3.1 and 8.3.2 of the National tariff policy says In accordance with the National Electricity Policy, consumers below poverty line who consume below a specified level, say 30 units per month, may receive a special support through cross subsidy. Tariffs for such designated group of consumers will be at least 50% of the average cost of supply. This provision will be re-examined after five years.
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For achieving the objective that the tariff progressively reflects the cost of supply of electricity, the SERC would notify roadmap within six months with a target that latest by the end of year 2010-2011 tariffs are within 20 % of the average cost of supply. The road map would also have intermediate milestones, based on the approach of a gradual reduction in cross subsidy. From the above it is clear that the Electricity Act 2003 as well as National tariff Policy provide for usage of average cost of supply rather than voltage wise cost of supply for determination of cross subsidy reduction road map. Accordingly, the BSEB would like to inform the objector that such a requirement is neither under ambit of law nor mandatory under any regulation/ policy. It is necessary to note that no act/policy/regulation provides for voltage level wise determination of cost of supply and hence BSEB is not adopting the methodology as proposed by Objector. As per National Tariff Policy, tariff should be determined based on the average cost of supply and same methodology is adopted by BSEB. Commissions observation The objections and response from the Board are noted. Voltagewise cost of supply data is not available with BSEB for want of metering in all feeders. Board is directed to make allout efforts to collect this information and do energy accounting/ audits. However, the Commission has determine the ARR and tariff on average cost of supply. 3.2.30 Issue: Transformer capacity for HT Services Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industry & Commerce, Bihar Chamber of Commerce, North Eastern Bihar Chamber of Commerce and industries, M/s Kalyanpur Cement Limited and M/s Patwari Steel Limited have suggested that the Boards proposal for revising the contract demand of HT consumer except RTS consumers to 2/3rd of the
Transformer Capacity should not be accepted. They also suggested that limiting the Transformer Capacity to 150% of contract demand is also not correct and higher capacity Transformer should be allowed. Petitioners submission
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This measure was initiated to reduce the incidence of stress on the system (intended or unintended) and reduce possibility of theft. It is statutory obligation of the board to bring down losses and this is in line with the commitment of BSEB to bring down T&D losses. Commissions observation The Commission is of the view the existing provision in the Tariff Order for FY 201112 may be continued. 3.2.31 Issue: Removal of grace period Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce suggested that the Boards request for removal of grace period should not be allowed as it is against consumer interest. Petitioners submission BSEB submitted that it does not see any merit to continue with the grace period as due date provide sufficient time for the consumer to pay his bill. The grace period is not workable as it impacts revenue of the BSEB; consequently the same amount gets reflected in higher rate for other consumer category. Commissions observation The objection and response are noted. The Commission is in favour of grace period of 10 days. 3.2.32 Issue: Quality of Power Various consumers/ consumer Associations suggested that the capacity of installed transformers is not adequate which results in interruptions, breakdown, shutdown, tripping etc. and therefore BSEB should install transformers with adequate capacity matching with their demand. Petitioners submission Bihar is a power deficit state and BSEB has obligation to serve the consumers. In order to fulfil its obligation, BSEB is expanding its network across the length and
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breadth of the state. To meet the growing demand of electricity of existing and new consumers, BSEB is purchasing power through short and medium term. Commissions observation The Commission directs the Board to submit a comprehensive plan to improve the quality of supply and service to consumers and meet the Standards of Performance as stipulated in the Regulation. 3.2.33 Issue: Maintaining HT Consumer Base Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce suggested that the Board should endeavour to increase the HT consumer base so as to reduce the burden from the existing HT Industries and all other paying consumers and increase its financial viability. Petitioners submission The Board submitted that the change in consumer mix is not within the control of BSEB. Commissions observation The Commission appreciates the concerns raised by the objectors. As a step towards reducing the burden on the HT consumers, the Commission has adopted the approach of gradually reducing the cross-subsidy in its Tariff Order FY 2012-13. 3.2.34 Issue: Frequent revision of tariff and FPPCA charges M/s Kalyanpur Cement Limited and M/s Patwari Steels Private Limited, by giving reference to Clause - 213 of the BERC (Terms and conditions for determination of Tariff) Regulations, 2007, have submitted that within a span of seven (7) months there have been two tariff revisions and this is third exercise of tariff revision. M/s Dadiji Steel Limited, M/s Kalyanpur Cement Limited, Bihar Steel Manufacture Association, M/s Balmukund Concast Limited, Vidyut Upboghta Sangarsh Samiti, Central Bihar Chamber of Commerce, South Bihar Industries Association, Divisional Chamber of Industry & Commerce, Bihar Chamber of Commerce and Eastern Bihar
3
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Industries Association have raised objections on frequent levy of FPPCA charges by the Board. These consumers have stated that such frequent and massive increase in the tariff rates by the Board within last twelve months has completely ruined the financial position of the industries in the state. Petitioners submission The Board submitted that the factual position in the case referred by the objector is as follows: The Tariff Order issued on 6th Dec 2010 was for FY 2010-11; The Tariff Order issued on 1st June 2011 was for FY2011-12; The Tariff Order likely to be issued in March 2012 will be for FY2012-13. The tariff revision is likely to effective from April 2012.
Section 63(4) of the Electricity Act 2003 states that no tariff or part of any tariff may ordinarily be amended more frequently than once in any financial year, except in respect of any changes expressly permitted under the terms of any fuel surcharge formula as may be specified. Thus it is clear that there can be two revisions in a year provided that the revisions lie in a different financial year. Thus the referred provision of the EA 2003 is not likely to get violated in the situation referred by the Objector. The Board further submitted that the FPPCA charges are levied on the consumers after approval from the Commission only. It is within the powers to the Commission to decide the modalities for recovery of difference between the power purchase rate approved in the ARR and actual power purchase cost without adversely affecting the cash flows of BSEB. Commissions observation The Commission has noted the objections of the objectors and response of the Petitioner. Additional cost/ surplus on account of Fuel and Power Purchase Cost Adjustment (FPPCA) are passed on to the consumers for any increase or decrease in fuel and power purchase cost. The central power generating stations revise their cost as and when these changes in the costs need to be passed on to the consumer. Therefore levy of FPPCA charge is in accordance with the provisions of Electricity Act 2003 and BERC (Terms and Conditions of determination of tariff) Regulation, 2007.
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3.2.35 Issue: Applicability of tariff category Bhojpur Chamber of Commerce and Industry stated that the consumer with load above 60 KW availing supply for commercial purpose should be considered under NDS category rather than HT Category. M/s Bhola Ram Steels Private Limited has suggested that in case a consumer has three different connections for Ferro Alloys unit, Rolling Mill and Induction furnace in the adjoining campus with separation by boundary walls, such consumers should have option for availing single connection for these units under HTSS category. Petitioners submission The Board has stated that the power lies with the Commission to decide which type of consumer will come under which category. The Board further stated that the issue raised by M/s Bhola Ram steels Private Limited the Board stated that the matter raised does not pertain to tariff petition for FY 2012-13, so the board has no comment to offer. The objector may raise its concerns at the appropriate forum. Commissions observation The objection and response are noted. The suggestions of consumer groups will be considered while deciding the tariff for consumer categories. 3.2.36 Issue: Creation of new categories M/s Dadiji Steel Limited has objected to the ARR and tariff proposal for FY 2012-13 of the Board in respect new tariff categories for HT consumers as well as new subcategory for LT consumers (such as Temporary category, NDS-IV & Merger of LTISI & II). Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce have strongly objected to the Boards proposal for creation of Construction Power with 25% extra charge. It was stated that construction Power should not be more that 10% extra and its billing demand should be same as other HT categories. Bihar Chamber of Commerce, Central Bihar Chamber of Commerce, South Bihar Industries Association and Divisional Chamber of Industry & Commerce were of the view that further categorisation of NDS category for Hoardings is unnecessary and should not be allowed. These Consumers have also opposed the Petitioners proposal for applying higher tariff on merged LTIS category and compulsory demand
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based tariff. Bihar Chamber of Commerce also stated that the HTSS tariff should be available as an option for HT consumer and should not be made compulsory for any class of consumers. Representative from International Buddhist Council (IBC) of Buddha Gaya was of the view that they should be considered under special tariff category. Petitioners submission New categories are formed based on the evolving load characteristics of consumers and practical problems faced in the field. BSEB has proposed the merger of LTIS-I and LTIS-II sub-categories. There would be uniform per HP fixed and minimum energy charges. The merger would do away with the requirement of migration from one sub-category to the other on change in connected load. This would facilitate the consumers to increase or decrease the connected load with the requirement of the business without change in sub-category. Further this would do away with the disincentive to consumers/employees of BSEB to conceal the actual connected load to prevent the shift from lower tariff category to the higher tariff category. Regarding creation of new categories like construction power, temporary category, NDS IV and merging of LTIS- I and LTIS-II, the Board has stated that, based on the practical difficulties faced in the field, utility and capacities to pay, these categories have been proposed by BSEB and It is for Commission to decide on proposal of the BSEB. On the issue of making HTSS category as option, the Board has stated that this category has been designed keeping in view the specific need of the steel industry and hence other categories cannot be allowed to opt for this category. Commissions observation The Commission shall take prudent view on the matter of creation of new tariff category while determination of ARR and Tariff Order for FY 2012-13. Further, the Commission agrees with the view of the BSEB that the HTSS is a separate category than the other HT category. 3.2.37 Issue: Release of Connection including tatkal connections
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Some LT consumer group pointed out that the Board takes a lot of time in releasing new connections. Further, it was pointed out that the Board is charging the meter cost and cost of service cable from the consumers while releasing new connections. The Board should be more efficient in releasing new connections particularly the Tatkal connections. Petitioners submission The Board has submitted that in the past it has received numerous requests from its consumers for providing tatkal connections. In view of this demand of its consumers, BSEB proposes this scheme under which all consumer categories other than High Tension and Railway may avail benefit of this scheme. The general and miscellaneous charges for the Tatkal connection will be 2 (Two) times the charges approved under the head general and miscellaneous charges for normal new connections. The connection under this scheme shall be released by BSEB in half the time limit specified by the Commission in the Electricity Supply Code from the date of completion of prescribed procedural formalities and payment of applicable fees and charges. In case BSEB fails to release connection within this time limit, BSEB will refund the additional amount to the consumer in the first energy bill. Higher charges have been proposed to recover the higher cost likely to be incurred by BSEB in providing connections in half the time proposed in Supply Code. Commissions observation The Commission appreciates the concerns of the consumers. The Commission appreciates that the Board needs to do a lot to improve quality of service to the consumers particularly in respect of release of new connections. Directive has been issued to the Board in this regard and the same is being reiterated in this Tariff Order. The proposed introduction of the scheme of tatkal connections is accepted by the Commission with some modifications. 3.2.38 Issue: Proposed sales for FY 2012-13 under Unmetered Kutir Jyoti and Agriculture category M/s Dadiji steel Limited and Bihar Steel Manufacturer Association pointed out that the Board in its tariff petition have stated that there are still 20 lakh un-metered consumers. The Board has indicated the growth in the un-metered consumers and has asked for approval of consumption norms of 30 units per connection per month
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for Kutir Jyoti consumers both in respect for rural and urban areas. The Board has projected to add 2746 tube-wells at a connected load of 20 kW each in the month of December 2011 whereas there is no justification of the claim made by the BSEB. Petitioners submission The Board submitted that it has 3,02,914 Unmetered Kutir Jyoti consumers and the Board will provide meter in a time-bound manner. New connections under Kutir Jyoti category will be 21,82,603 and these will all be metered connections only. The Board also stated that it is providing connections to 2764 tube wells under the NABARD phase-II scheme of Minor Irrigation Department of Government of Bihar. Commissions observation The Commission has considered the report submitted by the independent consultant on assessment of consumption of Kutir Jyoti (Rural) and agriculture un-metered consumers. The Commission has retained the consumption norms for these categories at the level of FY 2011-12.
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4 True Up of FY 2010-11
4.1 4.1.1
Background As per the Sub-Clause 22 (1) & (2) of the BERC (Terms and Conditions for Determination of Tariff) Regulations 2007 The Commission shall undertake a review along with next Tariff Order, of the expenses and revenues approved by the Commission in the current year Tariff Order. While doing so, the Commission shall consider variations between approvals and revised estimates / pre-actuals of the sale of electricity, income and expenditure for the relevant year and permit necessary adjustments / changes in case such variations are for adequate and justifiable reasons. Such an exercise shall be called Review. After audited accounts of the year are made available, the Commission shall undertake a similar exercise as in sub-clause (1) above based on the final actual figures as per the audited accounts. This exercise based on the audited accounts shall be called Truing up. The truing up exercise for any year shall not ordinarily be considered after more than one year gap after Review.
4.2 4.2.1
True-up of ARR for FY 2010-11 Bihar State Electricity Board submitted a petition on 13th October, 2011 vide letter no. Com/ FPPCA-136/2011-1659 for regulatory approval of the review of ARR for FY 2010-11 based on their provisional annual accounts. The Commission vide its Order dated 3rd November, 2011 directed BSEB to submit its petition for review of the expenses and revenues for the FY 2010-11 along with tariff petition for FY 2012-13. Commission also directed BSEB that, if the final audited accounts for the FY 2010-11 are made available to the Commission along with tariff petition for FY 2012-13 or during the course of hearing of the tariff petition for the FY 2012-13, a final true up of the expenses and revenues for the FY 2010-11 shall be considered by the Commission.
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4.2.2
Subsequently, BSEB vide letter No. Com/ Tar-132/ 2011-392 dated 2nd March, 2011 submitted the audited annual accounts for FY 2010-11 along with the audit certificate issued by CAG to the Commission and thereafter, BSEB has also submitted true up petition for FY 2010-11 based on its audited annual accounts vide letter no. Com/ Tar-132/ 2011-451 dated 16th March, 2011.
4.2.3
The Commission had approved the ARR for FY 2010-11 vide its Tariff Order for FY 2010-11 (Case No. TP-3 of 2010) dated 6th December, 2010. Accordingly, now the figures which were approved by the Commission in the Tariff Order for FY 2010-11 and audited annual account of FY 2010-11 would form the basis for approval of the truing up for FY 2010-11. However, the Commission may re-visit some of the approvals given as part of the Tariff Order process in case it feels the need to do so.
4.2.4
The truing up exercise for FY 2010-11 undertaken by the Commission is on the basis of decisions & directives of the Commission in Tariff Order for FY 2010-11, audited annual accounts for FY 2010-11 and BERC (Terms and conditions for determination of Tariff) Regulations 2007. However, wherever deemed necessary, the Commission has considered expenses based on prudency check and after considering the efficiency parameters like T&D losses, generating stations plant operating parameters, etc.
4.2.5
The component-wise description of licensees submission and Commissions analysis on the same is discussed in the subsequent sections.
4.3
Category wise energy sales Petitioners submission
4.3.1
The Petitioner submitted the energy sales figures of 6139 MUs for FY 2010-11 on the basis of audited annual accounts and as per Commissions norms.
4.3.2
Further the Petitioner has submitted that as per the Tariff Order for the FY 2010-11, the Commission considered agriculture consumption norm of 1485 units/ kW/annum for FY 2010-11 i.e. considering 5.5 hours of average utilization per day for 270 days in a year. Based on the norm of 1485 units/kW/annum, the consumption for FY 201011 as approved by the Commission was 428 MU for the connected load of 2,88,100 kW.
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4.3.3
The BSEB has computed the consumption by the agriculture consumers based on the norms and methodology used by Commission. In the true-up petition, the BSEB has reported actual load of 2,61,684 kW during FY 2010-11, though the annual accounts of FY 2010-11 shows the agriculture load of 4,17,191 kW. The annual account shows only the registered load of agriculture consumer and not the effective load. Accordingly for the connected load of 2,61,684 kW, as reported by BSEB, and based on the consumption norm of 1485 Units/kW/Annum as approved by the Commission, the agriculture sales for FY 2010-11 works out to 389 MUs.
4.3.4
The Petitioner has requested the Commission to approve the total sales as per BERC norms which is 6139 MUs. Commissions analysis
4.3.5
The Commission has scrutinized the commercial information with regard to the category wise sales submitted by the Petitioner for FY 2010-11. The quantum of energy sales for FY 2010-11 as approved by Commission in the Tariff Order for FY 2010-11 was 7225 MUs whereas the sales figures as per the Boards audited accounts was 6139 MUs. Accordingly, as per the consumption norms for Kutir Jyoti and agricultural consumers as approved in the tariff Order of FY 2010-11, the Commission approves the category-wise sales in FY 2010-11 at 6139 MUs as proposed by the Board. The same would be used for approving the power procurement cost.
4.3.6
The following table summarises the category-wise sales for FY 2010-11.

Table 6: Summary of Category-wise Sales for FY 2010-11
Sl. 1 2 3 4 5 6 7 8 9 10
Category Name Kutir Jyoti (Rural and Urban) Domestic (DS-I & DS-II) Non-Domestic (NDS-I, NDS-II & NDS-III) Public Lighting Irrigation and Agriculture Public Water Works Industrial LT Industrial HT Railway Traction Sale to Nepal
Approved in T.O. for FY 2010-11
Audited Annual Accounts 2133 490 33 389 60 226 1,501 458 555
Now Approved in True up 2133 490 33 389 60 226 1,501 458 555
231 2664 629 28 428 200 236 1660 570 300
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Sl.
Category Name Sub-Total
Approved in T.O. for FY 2010-11
Audited Annual Accounts 5845 293 6139
Now Approved in True up 5845 293 6139
11
Sales to other state under UI Total Sales
6946 279 7225
4.4
Transmission and Distribution Losses Petitioners submission
4.4.1
The Table below summarises the overall T&D loss levels as submitted by the Petitioner for FY 2010-11:
Table 7: Proposed T&D losses by BSEB for FY 2010-11
Particular T&D Losses (%)
FY 2010-11 (Approved) 32.00 %
FY 2010-11 (Actual Accounts) 43.59 %
FY 2010-11 (ActualBERC Norm) 44.80 %
4.4.2
In FY 2010-11, the T&D losses as per audited annual accounts were 43.59%. The BSEB has submitted that T&D losses work out to 44.80% if calculated as per the agriculture consumption norm approved by the Commission.
4.4.3
The BSEB submitted that it has undertaken massive rural electrification work under the RGGVY scheme. Consequently, there has been a tremendous increase in the network of BSEB in the high loss rural areas and an addition of large number of Kutir Jyoti consumers. The BSEB has electrified 633096 number of BPL households and 5297 number of villages during FY 2010-11. This substantial addition in the network has not only led to increase in the technical losses in the system, but has also rendered the system porous and prone to theft of electricity. Given the vast expansion of the rural areas it is not always possible for BSEB to control theft. Due to these reasons, BSEB has not been able to achieve the loss targets given by the Commission.
4.4.4
The BSEB has requested the Commission to consider the T&D losses of 43.59% at the time of calculating power purchase requirement. Further, it has also requested the Commission to compensate the difference between actual power purchase cost and power purchase cost calculated based on the agriculture consumption norm and T&D loss trajectory from the Resource Gap Funding provided by the State Government. Commissions analysis
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4.4.5
The Commission has approved target of T&D losses at 32% for the FY 2010-11. The trajectory had already been reviewed earlier by the Commission. The Commission is of the view that T&D losses is a controllable parameter and it is the responsibility of distribution licensee to take appropriate measures to bring down the T&D losses. The Commission cannot allow the burden of higher T&D loses, due to non-achievement of T&D loss reduction trajectory by BSEB as approved by the Commission, to be passed on to the consumers. Accordingly, the Commission approves the Transmission & Distribution losses of 32% for true up for FY 2010-11. The same shall be considered at the time of computation of the power purchase cost. This is also in-line with the loss level approved by the Commission in the Tariff Order for FY 2010-11.
4.4.6
The table below summarises the T&D loss levels target set by Commission, T&D loss as per audited annual accounts of Board and the approved T&D loss in truing up for FY 2010-11:
Table 8: Approved T&D Loss for FY 2010-11 As approved by BERC in As per Annual Accounts T.O. for FY 2010-11 of FY 2010-11 32% 43.59%
Particulars T&D Losses (%)
Now Approved in True up of FY 2010-11 32%
4.5
Own Generation Petitioners submission
4.5.1
The BSEB has submitted that it owns and operates one thermal generating plant i.e. Barauni Thermal Power Station (BTPS) located at Barauni. The overall installed capacity of Unit IV, V, VI and VII of the BTPS in FY 2010-11 was 320 MW. However, it was submitted in the petition that during FY 2010-11, out of the remaining two functional units i.e. Unit VI and VII, Unit VI was functioning at a de-rated capacity, while Unit VII was under shutdown and Renovation & Modernization work was going on for its revival.
4.5.2
Accordingly, the actual performance of the BTPS, Barauni in FY 2010-11 as per the annual accounts was not at desired levels. The BSEB has requested the Commission to approve the same.
Table 9: Summary of BTPS Performance proposed by Petitioner for FY 2010-11
Particular Capacity (Unit VI & VII) Capacity in Use
Units MW MW
FY 2010-11 (Approved) 220 105
FY 2010-11 (Actual) 220 105 Page 68
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TARIFF ORDER FOR FY 2012-13 FY 2010-11 (Approved) 39.14% 10% 360 36 324 FY 2010-11 (Actual) 23.97% 17.95% 220.44 39.56 180.88
Particular Plant Load Factor Auxiliary Consumption Gross Generation Auxiliary Consumption Net Generation
Units % % MUs MUs MUs
Commissions analysis 4.5.3 The Commission found that the performance of unit VI of BTPS in FY 2010-11 on the key performance parameter such as Auxiliary Consumption has been high as compared to past three financial years. As can be seen, the actual performance of BTPS Unit VI has not improved as expected by the Commission and has in fact deteriorated further. Considering these facts, the Commission is not agreeable to approving the performance parameters of BTPS Unit VI at actuals. Accordingly, the Commission approves auxiliary consumption @ 14.40% of the gross generation as approved in the true-up order of FY 2009-10. 4.5.4 Accordingly, the Commission now approves Gross generation of 220.44 MU and net generation of 188.70 MUs for FY 2010-11. 4.5.5 Summary of the approved generation performance is as shown in the table below:
Table 10: Summary of approved Generation performance for FY 2010-11
Particulars Capacity Capacity in use Gross Generation Plant Load Factor Auxiliary Consumption Auxiliary Consumption Net Generation
Units MW MW MUs % % MUs MUs
FY 2010-11 (Approved) 220 105 360 39.14% 10% 36 324
FY 2010-11 (Actuals) 220 105 220.44 23.97% 17.95% 39.57 180.87
Now Approved in True up 220 105 220.44 23.97% 14.40% 31.74 188.70
4.6
Power Purchase Petitioners submission
4.6.1
The BSEB had firm allocations of power from thermal power plants of NTPC, Hydel Power Plants of NHPC, and the hydel plants of Chukka & Tala through PTC and hydel plants of BSHPC and thermal power plant of Kanti BUNL. In addition to these, BSEB also purchases power from co-generation sources of sugar mills.
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4.6.2
The Petitioner has submitted gross power purchase quantum of 10977.81 MUs from all sources in its true-up petition for FY 2010-11. The BSEB has requested the Commission to approve 10977.81 MU of power purchase quantum for the FY 201011. Commissions Analysis
4.6.3
The Commission recognises the sources of power as outlined by BSEB based on the Audited Annual Accounts for FY 2010-11 and the costs associated with purchase of power from these sources. However, the quantum of power purchase and the cost associated with the same would be approved after taking into cognisance the approved energy sales for the year and the T&D loss trajectory.
4.6.4
The Commission intends to use the same methodology for approval of the Power purchase quantum and cost associated with the same based on the information available in the Audited Annual Accounts for FY 2010-11 and approves the quantum of Power Purchase on the same principles as done earlier during the true up for FY 2006-07 to FY 2009-10.
4.6.5
The summary of the approved power purchase quantum from various sources for the FY 2010-11 is given in the table below:
Table 11: Source-wise Power Purchase Quantum for FY 2010-11 (MUs)
Sl.
Power Plant Name NTPC
Approved by BERC in T.O. FY 2010-11 2760.00 2245.00 2600.00 500.00 8105.00 145.00 550.00 695.00 560.00 1020.00 1580.00 50.00
Audited Annual Accounts of FY 2010-11 3146.43 2531.83 2669.74 273.23 8621.23 118.79 549.31 668.10 543.23 909.36 1452.59 -
Now approved in True up of FY 2010-11 3146.43 2531.83 2669.74 273.23 8621.23 118.79 549.31 668.10 543.23 909.36 1452.59 Page 70
1 2 3 4
Farakka Kahalgaon Talchar KBUNL Sub Total (NTPC) NHPC
5 6
Rangit Teesta Sub Total (NHPC) PTC
7 8
Chukka Tala Sub Total (PTC) Others
NEA Muzaffarpur
BERC Approved by BERC in T.O. FY 2010-11
TARIFF ORDER FOR FY 2012-13 Audited Annual Accounts of FY 2010-11 34.91 9.09 50.00 55.00 155.00 10535.00 27.37 28.35 136.17 235.89 10977.81 Now approved in True up of FY 2010-11 34.91 9.09 27.37 28.35 136.17 235.89 10977.81
Sl. 10 11 12 13 14
Power Plant Name NEA Motihari NEA Purnea BSHPC New Swadeshi Sugar Mill UI Sub Total Others Grand Total
4.6.6
The Commission now considers the total quantum of power purchase, i.e. 10977.81 MUs, for the purpose of working out the energy balance and computation of the power purchase expenses as part of the true up exercise.
4.7
Energy Balance Petitioners submission
4.7.1
The energy requirement for FY 2010-11 submitted by the Petitioner based on the proposed sales and T&D losses is tabulated hereunder:
Table 12: Proposed Energy Requirement & Energy balance for FY 2010-11
Particular Energy Sales within State Energy outside State (Nepal) Sale in bilateral trade/ UI Total Sales T&D Losses T&D Losses Energy Requirement Energy Availability Own Generation Total Purchase from long term sources Transmission loss in regional losses Transmission loss in regional losses Net Power Availability Additional purchase
Unit MU MU MU MU MU % MU
FY 2010-11 (Approved) 6,646 300 279 7,225 3,269 32% 10,494
FY 2010-11 (Actual Accounts) 5,291 555 293 6,139 4,744 43.59% 10,883
FY 2010-11 (Actual-BERC norm) 5,291 555 293 6,139 2,751 32.00% 8,890
MU MU % MU MU MU
324 10,535 3.70% 365 10,494
181 10,978 2.63% 276 10,883
181 10,978 2.63% 276 10,883 1,993
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4.7.2
The BSEB in its submission has recognised 1993 MUs of additional Power purchase on account of higher T&D losses and requested the Commission to dis-allow the same for the FY 2010-11. Commissions analysis
4.7.3
The energy requirement of the Petitioner is approved based on the approved values of sales and T&D losses by the Commission. The T&D losses have not been considered on sales in bilateral trade/ UI.
4.7.4
The energy balance for FY 2010-11 shall be prepared based on the approved sales to consumers during the year, the approved level of T&D losses and the power purchased/generated to meet the demand from the consumers.
4.7.5
Accordingly, the approved total power purchase requirement (net) based on the approved sales to consumers and approved T&D losses is 8890.09 MUs. As against this, the net availability as per approved Generation parameters is computed as 10882.85 MUs. Thus, the additional power purchase from long term sources over and above the requirement comes to 2052.15 { =10977.81 (Actual power purchase from long term sources as per annual accounts) - 8925.66(Actual power purchase from long term sources as approved by Commision) } MUs. Accordingly, the Commission disallows power purchase quantum of 2052.15 MUs for FY 2010-11. The power purchase cost corresponding to the same would be adjusted in the total power purchase cost approved for the year.
Table 13: Approved Energy Requirement for FY 2010-11
Particular Energy Sales within State Energy outside State (Nepal) Sale in bilateral trade/ UI Total Sales T&D Losses T&D Losses Energy Requirement Energy Availability Own Generation Total Purchase from long term sources
Unit MU MU MU MU MU % MU
FY 2010-11 (Actual Accounts) 5,290.76 555.00 293.38 6,139.14 4,743.93 43.59% 10,883.07
FY 2010-11 (Actual-BERC norm) 5,290.76 555.00 293.38 6,139.14 2,750.95 32.00% 8,890.09
FY 2010-11 (Now Approved in True up) 5,290.76 555.00 293.38 6,139.14 2,750.95 32.00% 8,890.09
MU MU
180.87 10,977.81
180.87 10,977.81
188.70 8,925.66
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TARIFF ORDER FOR FY 2012-13 FY 2010-11 (Now Approved in True up) 2.51% 224.27 8,890.09 2,052.15
Particular Transmission loss in regional system Transmission loss in regional system Net Power Availability Additional purchase disallowed
Unit % MU MU MU
FY 2010-11 (Actual Accounts) 2.51% 275.83 10,882.85
FY 2010-11 (Actual-BERC norm) 2.51% 275.83 10,882.85 1,992.77
4.7.6
The total purchases from long term sources has been worked out considering the impact of average regional transmission losses (2.51% = 275.83 MU 10977.81 MU) applicable on the total actual power purchase by BSEB in FY 2010-11. The reason for applying the average regional transmission losses is that the power purchase quantum by BSEB also includes sources of power on which the regional transmission losses of 3.7% are not applicable e.g. UI power, Nepal (NEA), BSHPC, etc. Accordingly, the gross power purchase required to be done in FY 2010-11 was 8925.66 MU with a regional transmission loss of 224.02 MU. {8925.66 MU = (8890.09 188.70) (1-2.51%)}
4.7.7
Accordingly, the Commission has disallowed power purchase quantum equivalent to 2052.15 MUs for the FY 2010-11 as part of true up process based on the principle that excess power purchase on account of higher T&D losses i.e. over and above the approved losses shall not be permitted.
4.8
Own Generation Cost Petitioners submission
4.8.1
BSEB submitted that net generation from the BTPS for FY 2010-11 was 180.88 MUs as against the approved level of 324 MUs. The Petitioner submitted that the Gross Generation from BTPS for FY 2010-11 was 220.44 MU. The BSEB has further submitted that unit VI of BTPS was under R&M for most of the year and could achieve PLF of only 23.97% and hence was not able to achieve operational parameters set by the Commission; whereas unit VII of BTPS remained under shut down for the entire period during FY 2010-11.
4.8.2
The variable cost calculation submitted by the Petitioner for BTPS is tabulated below:Table 14: Proposed Plant parameters & Fuel cost determinants for BTPS
Particulars
Unit
FY 2010-11 (Actual)
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Particulars Gross Generation Auxiliary Consumption Net Generation Capacity De-rated Capacity Plant Load Factor Auxiliary Consumption Station Heat Rate Sp. Oil Consumption Gross Calorific Value of Coal Calorific Value of Oil Transit losses Actual Oil Consumption Actual Coal Consumption Specific Coal Consumption Price of Coal Price of Oil Coal Cost Oil Cost Fuel Cost Other Fuel Related costs Total Fuel Costs
Unit MUs MUs MUs MW MW % % kcal/kWh ml/kWh kcal/kg kcal/l % Kl MT kg/kWh Rs./MT Rs/kl Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr.
FY 2010-11 (Actual) 220.44 39.56 180.88 110 105 23.97% 17.95% 4,103 31.48 3,858 9,950 0.00% 6939 2,16,560 0.98 1,823 31,388 39.48 21.78 61.26 5.06 66.32
4.8.3
The Petitioner accordingly requested the Commission to consider gross generation of 220.44 MUs and generation costs of Rs 66.32 Cr. for FY 2010-11. Commissions analysis
4.8.4
In the Tariff Order for FY 2010-11, the Commission has stated that The maximum norm provided for old coal based generating stations of DVC by CERC is 3.0ml/kWh. The Barauni Unit 6 is already renovated and so, is expected to perform and meet the norms. For the year 2010-11, specific consumption of oil at 10.0ml/kWh is considered by the Commission against 20.0ml/kWh proposed by the BSEB. Efforts shall be taken by BSEB to bring down the specific oil consumption to the level of CERC norm. Similarly the norm of gross station heat rate considered by CERC for the old thermal generating stations of DVC is 3100Kcal/kWh, where as BSEB has shown the station heat rate as 4650Kcal/kWh and projected the specific coal consumption as
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0.95Kg/kWh. Since the Barauni Unit 6, which is renovated, is expected to improve the performance, specific coal consumption of 0.9Kg/kWh is considered by the Commission. Efforts shall be taken by BSEB to improve the SHR to the level of CERC norm. 4.8.5 The Commission found that the performance of unit VI of BTPS in FY 2010-11 on the key performance parameters such as Auxiliary Consumption and Specific Oil consumption has been poor as compared to past two-three financial years. As can be seen, the actual performance of BTPS Unit VI has not improved as expected by the Commission and has in fact deteriorated further. Considering these facts, the Commission is not agreeable to approving the performance parameters of BTPS Unit VI at actuals. Accordingly, the Commission approves auxiliary consumption @ 14.40% of the gross generation and Specific Oil consumption @ 18.45 ml/kWh as approved in the trueing-up order of FY 2009-10. 4.8.6 Further, the Commission approves the Station heat rate and calorific value of coal as per the audited annual accounts of BSEB for FY 2010-11 while giving due weightage to the vintage of the plant. The Commission also directs BSEB to take serious cognisance of the same and initiate steps towards improvement in the operational parameter of the generating station. 4.8.7 The Commission approves the fuel cost of Rs 58.66 Cr. for FY 2010-11 based on the cost determined by the Commission as per the Tariff Order for FY 2010-11 and the actual generation submitted by the Petitioner. The Operational parameters and details of cost component allowed by the Commission are stated below:Table 15: Approved plant parameters & fuel cost determinants for FY 2010-11
Particulars Gross Generation Auxiliary Consumption Net Generation Capacity De-rated Capacity Availability Factor Plant Load Factor Auxiliary Consumption Station Heat Rate Sp. Oil Consumption Gross Calorific Value of Coal
Unit MUs MUs MUs MW MW % % % kcal/kWh ml/kWh kcal/kg
FY 2010-11 (Actuals) 220.44 39.57 180.87 110 105 56.32% 23.97% 17.95% 4,103.31 31.48 3,858
Now Approved in True up of FY 2010-11 220.44 31.74 188.70 110 105 56.32% 23.97% 14.40% 4,103.31 18.45 3,858 Page 75
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TARIFF ORDER FOR FY 2012-13 Now Approved in True up of FY 2010-11 9,950 904,534 40,468 864,066 0.00% 4,067.12 223,967 1.02 1,823 31,388 40.83 12.77 53.60 5.06 58.66
Particulars Calorific Value of Oil Overall Heat Heat from Oil Heat from Coal Transit losses Actual Oil Consumption Actual Coal Consumption Specific Coal Consumption Price of Coal Price of Oil Coal Cost Oil Cost Fuel Cost Other Fuel Related costs Total Fuel Costs
Unit kcal/l G Cal G Cal G Cal % kl MT kg/kWh Rs./MT Rs/kl Rs Cr. Rs Cr. Rs Cr. Rs Cr. Rs Cr.
FY 2010-11 (Actuals) 9,950 904,534 69,043 835,488 0.00% 6,939 216,560 0.98 1,823 31,388 39.48 21.78 61.26 5.06 66.32
4.8.8
The Commission now approves total fuel cost of Rs. 58.66 Cr. for FY 2010-11 as part of the truing up process. This cost is excluding the cost of water and other miscellaneous expenses which are factored under the Repairs and Maintenance expenses.
4.9
Power Purchase Cost Petitioners submission
4.9.1
The Petitioner has submitted gross power purchase cost of Rs 3237 Cr. from all sources including intrastate and UI including transmission charges for FY 2010-11 for true up.
4.9.2
The Petitioner has claimed total transmission charges of Rs. 192.96 Cr. for total power purchased during FY 2010-11.
4.9.3
The Petitioner submitted the source-wise break up of total cost and unit cost, the details of which are given below:
Table 16: Proposed Power Purchase cost for FY 2010-11
Sl.
Power Plant Name
Power purchase cost (Rs. Cr.) FY 2010-11 FY 2010-11 (Approved) (Actual)
Per Unit Cost ( Rs./Unit) FY 2010-11 FY 2010-11 (Approved) (Actual)
NTPC
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BERC Power purchase cost (Rs. Cr.) FY 2010-11 FY 2010-11 (Approved) (Actual) 767 1085.09 491 566 181 2,005 25 94 119 89 188 277 21 12 23 57 178 2,636 644.39 744.24 99.73 2573.44 23.48 94.19 117.67 86.37 167.32 253.70 19.39 6.67 12.09 75.84 114.00 192.96 3251.78
TARIFF ORDER FOR FY 2012-13 Per Unit Cost ( Rs./Unit) FY 2010-11 FY 2010-11 (Approved) (Actual) 2.78 3.45 1.89 2.52 3.62 2.47 1.72 1.71 1.71 1.59 1.84 1.75 4.15 2.49 4.25 3.65 2.41 2.94 3.65 2.99 1.98 1.71 1.76 1.59 1.84 1.75 4.41 2.44 4.27 5.57 4.83
Sl.
Power Plant Name
1 2 3 4
Farakka Talchar Kahalgaon KBUNL Sub Total (NTPC) NHPC
5 6
Rangit Teesta Sub Total (NHPC) PTC
7 8
9 10 11 12
Nepal BSHPC New Swadeshi Sugar Mill UI Sub Total Others Transmission charges
13
PGCIL Charges Grand Total
2.50
2.96
Commissions analysis 4.9.4 Accordingly, the source-wise power purchase approved by the Commission for true up of FY 2010-11 is depicted in the table given below:
Table 17: Trued-up Power Purchase Cost for FY 2010-11 (Rs. Cr.)
Sl.
Power Plant Name NTPC
Now approved in true-up of FY 2010-11 Amount (Rs. Cr.) 1085.09 644.39 744.24 99.73 2573.44 23.48 Average rate (Rs./ kWh) 3.45 2.41 2.94 3.65 2.99 1.98 Page 77
1 2 3 4
Farakka Talchar Kahalgaon KBUNL Sub Total (NTPC) NHPC
Rangit
BERC
Sl. 6
Power Plant Name Teesta Sub Total (NHPC) PTC
Now approved in true-up of FY 2010-11 Amount (Rs. Cr.) 94.19 117.67 86.37 167.32 253.70 19.39 6.67 12.09 75.84 114.00 192.96 3251.78 2.96 Average rate (Rs./ kWh) 1.71 1.76 1.59 1.84 1.75 4.41 2.44 4.27 5.57 4.83
7 8
9 10 11 12
Nepal BSHPC New Swadeshi Sugar Mill UI Sub Total Others Transmission charges
13
PGCIL Charges Grand Total
4.9.5
The Commission accordingly approves power purchase cost of Rs. 3251.78 Cr for the FY 2010-11 as part of the truing up exercise.
4.10
Disincentive for non-achievement of T&D loss reduction Targets
4.10.1 The difference in the actual power purchase and the power purchase requirement approved by the Commission is disallowed at the average power purchase rate and is treated as Disincentive for non-achievement of T&D loss targets. 4.10.2 As per the trajectory, the T&D loss reduction target for FY 2010-11 was set at 32% which the Petitioner was not able to achieve. Accordingly, the Commission has computed the disincentive for non-achievement of T&D loss reduction targets at Rs. 623.54 Cr for FY 2010-11 as shown below:
Table 18: Disincentive: Non-achievement of T&D loss reduction target for FY 2010-11
Particular Net Power Purchase Dis-allowed Gross Power Purchase Dis-allowed (Grossed up at avg. loss @ 2.51%) Average Power purchase cost Cost of Power Purchase Dis-allowed
Units MUs MUs Rs./ kWh Rs. Cr.
FY 2010-11 2,052.15 2,105.05 2.96 623.54
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4.10.3 The Commission accordingly approves Rs. 623.54 Cr as dis-allowance for nonachievement of T&D loss target for the FY 2010-11 as part of the truing up exercise. 4.11 Operation & Maintenance Expenses Employee Cost Petitioners submission 4.11.1 Employee expenses typically comprise salaries, dearness allowance, bonus, terminal benefits in the form of pension & gratuity, leave encashment and staff welfare expenses. 4.11.2 The Petitioner submitted that the BSEB prepares its annual accounts on accrual basis, the employees cost consists of expenditures that accrue for the year and therefore, the amount of terminal benefits/ retiral dues payable to the retired employees is not treated as expenditure for the year. The amount actually paid is adjusted against the provision made in the books of account for pension, gratuity and leave encashment. 4.11.3 The Petitioner has submitted the net Employee Expenses of Rs. 593.90 Cr. for FY 2010-11 including salaries, dearness and other allowances, contribution towards terminal benefits, and unfunded terminal liabilities etc. The Petitioner has claimed Rs. 126.88 Cr. towards staff related liabilities & provisions as indicated in the schedule 28 of the Annual Accounts and Rs. 42.11 Cr. for interest on GSS, GPF and other staff deposits as indicated in the schedule 12 of the annual accounts on account of unfunded terminal liabilities in FY 2010-11. The employee cost capitalised during FY 2010-11 was Rs. 18.58 Cr. Hence the total employee expense claimed by the Petitioner for FY 2010-11 was Rs. 744.30 Cr. for FY 2010-11. 4.11.4 Commissions Analysis 4.11.5 The Commission in the Tariff Order for FY 2011-12 had stated as under:
4.7.12. So far the contribution of the employees towards GPF and GSS is concerned; this is not a part of employee cost. This amount is deducted from the salary of the employees and should be deposited in a separate fund to be governed
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by a Trust in which both BSEB and its employees are represented. Any investment out of this fund has to be with the approval of the Trust.
4.11.6 Accordingly, it is apparent that BSEB has utilised the amounts available in the fund created towards GPF and GSS contribution towards meeting its day to day expenses i.e. for the purpose of funding its working capital requirements. Accordingly, permitting these expenses to be passed on to the consumers shall mean that the consumers have to bear the burden for the past financial mismanagement by the Board. The Commission is of the view that such liabilities on account of past issues should be funded by BSEB through its own means and should not be passed on to the consumers at this point of time. The regulations anyway provide for interest on normative working capital to be passed on to the consumers thus meeting the working capital requirements of the licensee for the year. 4.11.7 In view of the above, the Commission approves the net employee cost for FY 201011, as depicted in the table given below:
Table 19: Employee Cost approved for FY 2010-11 (Rs Cr.)
Sl. 1 2 3 4
Particulars Employee cost Add: Payment made for unfunded liabilities Less: Employee cost Capitalized Net Employee cost
As per Annual Accounts 593.90 168.99 18.58 744.30
Now approved in True-up for FY 2010-11 593.90 0.00 18.58 575.32
4.11.8 The Commission approves Rs.575.32 Cr. as the employee cost for FY 2010-11. Repair and Maintenance (R&M) Expenses Petitioners submission 4.11.9 The Petitioner, in the true-up petition for FY 2010-11 has submitted the R&M cost at Rs 62.51 Cr. for FY 2010-11. Commissions Analysis 4.11.10 The Commission in its Tariff Order for FY 2008-09 dated 26th August, 2008 directed BSEB to include water charges & miscellaneous charges under the head R&M expenses and exclude the same from the head fuel cost.
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4.11.11 Based on the above, the Commission approves R&M expenses of Rs. 62.51 Cr. for the FY 2010-11 which includes Rs. 5.11 Cr. on account of water charges and other miscellaneous charges which were shifted from fuel costs to R&M expenses and base R&M expenses of Rs. 57.40 Cr. These values are the same as per the audited annual accounts for the FY 2010-11. 4.11.12 The summary of the approved R&M expenses for FY 2010-11 is as given in the table below:
Table 20: Summary of approved R&M cost (Rs. Cr.)
Sl. 1 2 3 4 5 6 7 8 9 10 11 12 13 14
Particulars Plant & Machinery Building Hydraulic works Civil Work Line cable & network Vehicles Furniture & fixtures Office equipment Operating expenses Total expenses Add cost of materials procured from Board's Hdqrs.for R&M Net Expenses Cost of water & Other Misc. Charges Total R&M Expenses
As per Annual Accounts 34.56 2.20 2.93 0.18 17.10 0.09 0.20 0.14 57.40 57.40 5.11 62.51
Now Approved in True-up for FY 2010-11 34.56 2.20 2.93 0.18 17.10 0.09 0.20 0.14 57.40 57.40 5.11 62.51
4.11.13 The Commission based on the audited annual accounts approves the R&M expenses of Rs.62.51 Cr. for the FY 2010-11. Administrative & General (A&G) Expenses Petitioners submission 4.11.14 The Petitioner has proposed the Administrative & General (A&G) expenses of for FY 2010-11 as Rs. 40.29 Cr. and also submitted that the A&G expenses capitalised during FY 2010-11 was Rs. 1.46 Cr. as per the accounts of BSEB. Commissions Analysis
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4.11.15 The Commission approves the A&G expenses submitted by BSEB for FY 2010-11. The summary of the A&G expenses approved is outlined in the table below:
Table 21: Summary of approved A&G cost (Rs. Cr.)
Sl. 1 2 3 4 5 6 7 8 9 10 a. b. c. d. e. f. g. h. i. j. k. l. 11 12 13 14
Particulars Rent, rates & taxes Insurance Telephone, postage &Telegrams Legal Charges Audit Fees Consultancy fees Technical fees Other professional charges Conveyance & travel expenses Others (sum of a. to l. as given below) Fees and Subscription Books and Periodicals Printing and Stationary Advertisement Water Charges Electricity Charges Entertainment Charges Computer Billing Home Guard/ Security Guard Franchisee Commission Franchisee Incentive Miscellaneous Expenses Freight Total A & G expenses Less: A&G expenses capitalized Net A & G expenses
As per Annual Accounts 0.50 0.00 0.99 0.98 3.25 0.00 0.01 0.00 4.99 29.39 1.70 0.05 0.72 1.47 0.02 8.93 0.15 3.84 2.65 2.11 1.00 6.74 0.17 40.29 1.46 38.83
Now approved in True-up for FY 2010-11 0.50 0.00 0.99 0.98 3.25 0.00 0.01 0.00 4.99 29.39 1.70 0.05 0.72 1.47 0.02 8.93 0.15 3.84 2.65 2.11 1.00 6.74 0.17 40.29 1.46 38.83
4.11.16 The Commission approves the actual net A&G expenses of Rs. 38.83 Cr. as reflecting in the audited annual accounts for FY 2010-11.
Operation & Maintenance (O&M) Costs

4.11.17 Based on the above approvals, the summary of the total O&M costs approved by the Commission for FY 2010-11 as part of the truing up process is outlined in the table below:
BERC

Table 22: Summary of approved O&M expenses for FY 2010-11 (Rs. Cr.)
Sl. 1 2 3 4
Particulars Employee cost Repair and Maintenance (R&M) Expenses Administrative & General (A&G) Expenses Total O&M Cost
FY 2010-11 (Approved) 660.00 95.00 38.76 793.76
FY 2010-11 (Actual) 744.30 62.51 38.83 845.64
Now approved in True-up for FY 2010-11 575.32 62.51 38.83 676.66
4.12
Capital Expenditure
4.12.1 As mentioned by the Commission during the truing up for the period from FY 2006-07 to FY 2008-09, the Capital Expenditure undertaken by BSEB is a very critical aspect of its business as it supports the growth of business and helps the Board in sustaining its operational performance. 4.12.2 As per para 51 of Chapter 5 of BERC (Grant of Licence for Distribution of electricity) Regulations, 2007, BSEB is required seek prior approval of the Commission for making investment in the licenced business. In the absence of the prior approval by the Commission, the Commission may disallow corresponding depreciation and interest cost. As can be seen, the availability of capital expenditure related information is a basic requirement of the distribution licence granted to BSEB. 4.12.3 BSEB in its true-up petition for FY 2010-11, has not submitted any information regarding the actual capital expenditure undertaken by it during the year and the capitalisation of assets on account of projects / schemes getting commissioned during the year. 4.12.4 The information relating to the capital expenditure provided by BSEB in the formats submitted along with the petition also does not provide the necessary information in a clear and unambiguous manner for the Commission to consider it for necessary decision making. 4.12.5 The Commission vide its letter no. BERC-Tariff-24/11-88 dated 27th January, 2012 had sought information regarding the capital expenditure that has been undertaken during the FY 2010-11 including details like the total value of the scheme, the capital expenditure done during the FY 2010-11, the corresponding capitalization against these schemes and the closing work in progress in respect of schemes which have not been capitalised. Further, the BSEB was also asked to provide the sanction letters of these loans and the financing terms. However, BSEB has not been able to
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provide the information as sought by the Commission, However BSEB could only inform the Commission about the details of capitalisation during FY 2010-11 in the following format:
Table 23: Details of capitalisation during FY 2010-11 (Rs. Lakh)
Activity Land and Land rights Building Other civil works Plants and Machinery Lines and cable network Vehicles Furnitures and Fixtures Office equipments Spare units/ Service units Total
Generation 16.80 16.80
Transmission 0.93 0.49 6.93 43.61 0.00 51.95
Distribution 4.37 0.32 0.52 288.43 628.02 0.01 0.04 0.81 922.52
Total 5.30 0.32 1.01 312.15 671.63 0.01 0.04 0.81 991.27
4.12.6 Accordingly, based on the limited information available with the Commission from the audited annual accounts, the Commission has estimated the actual capital expenditure incurred by BSEB in FY 2010-11. The same is outlined in the table below:
Table 24: Estimation of CWIP (Rs. Cr.)
Particulars Opening balance - CWIP Add: New investment during the year Total Less: Net Investment capitalization during the year Closing balance
Now approved in True-up for FY 2010-11 881.20 1,392.11 2,273.32 991.27 1,282.04
4.12.7 As can be seen from the above, the net investment capitalised during the FY 201011 is Rs. 991.27 Cr. The same is computed based on the other information which is available in the audited annual accounts e.g. Opening and Closing CWIP and the assets capitalised during the year. 4.12.8 The same can also be derived by tracking the movement in the quantum of Gross Fixed Assets and CWIP over the year. The same can also be corroborated from the Statement 7: Sources and Uses of Funds available in the audited annual accounts for FY 2010-11. The details are as illustrated below:
Table 25: Estimated Capital expenditure (Rs. Cr.) FY 2010-11
Particulars Bihar Electricity Regulatory Commission
Now approved in True-up for FY 2010-11 Page 84
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Particulars Opening balance GFA (a) Opening balance CWIP (b) Less: Closing GFA (c) Less: Closing CWIP (d) Net change in GFA/ CWIP (e = c + d a b)
Now approved in True-up for FY 2010-11 2,864.80 881.20 3,856.07 1,282.04 1,392.11
4.12.9 The Commission directs BSEB to ensure that information like Capital expenditure and the related capitalisation of assets, etc. should be available with it as it is a basic information required by the Commission to approve expenditure related to funding costs incurred by BSEB. In the absence of availability of such information, the Commission will be constrained to adopt normative capital expenditure related costs and may also not allow such expenditure at all, as such expenditure cannot be passed on to the consumers without proper prudence check. 4.12.10 Based on the information available in the audited accounts the capital assets to the tune of Rs. 991.27 Cr. have been capitalised in the FY 2010-11. The Commission now approves the same for computation of the interest expenses. 4.13 Gross Fixed Assets
4.13.1 The Commission vide letter No. BERC-Tariff-24/11-88 dated 27th January, 2012 enquired from the Petitioner regarding, the asset added during FY 2010-11 under head Plant and Machinery and Lines and Cable Network and its source of funds (Loans/ Grant etc.). The Board vide letter No.Com/ Tar-132/2011-375, dated 01.03.2012 could only submit the detailed break-up of assets added during FY 2010-11 under that the head Plant and Machinery and Lines and Cable Network as shown in the table below, however BSEB has not provided information regarding the source of fund through which the assets have been created:
Table 26: Asset added during FY 2010-11 in plant & machinery & Line & Cable N/W
Amount (Rs.) Plant and Machinery Line and Cable network APDRP RGGVY State Plan/ Internal Resources Total 3121530757 6745633030 3352552737 4989350507 1525260543 1,433,471,103
Remarks The Amount capitalised under APDRP scheme has been funded by loan from PFC and State Govt. The Amount capitalized under RGGVY scheme has been funded by loan from REC under RGGVY scheme in which Rs. 449,04,15,066/- as grant and Rs. 49,89,35,451/- as loan.
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4.13.2 The Commission has approved the Gross Fixed Asset as per the audited annual accounts of BSEB. The position of the Gross fixed assets during FY 2010-11 is as shown in the table below:
Table 27: Gross Fixed Assets (Rs. Cr.) FY 2010-11
Particulars Opening GFA (As on 1st April 2009) Additions to GFA during the year Deductions to GFA during the year Re-classification during the year Closing GFA (As on 31st March 2010)
Now approved in True-up for FY 2010-11 2,864.80 1,005.42 14.14 0.00 3,856.07
4.14
Depreciation Petitioners submission
4.14.1 The Petitioner in the true-up petition for FY 2010-11 submitted the depreciation expenses of Rs 89.00 Cr. for FY 2010-11 based on the audited annual accounts for BSEB. Commissions Analysis 4.14.2 The Commission has approved the depreciation charges based on the schedule 20 of the audited annual accounts of FY 2010-11. However, the depreciation on the assets created out of consumer contribution, grant has been deducted from the gross depreciation to arrive at the net depreciation charge for BSEB. The computation of the depreciation on the assets created out of consumer contribution, grant is based on the proportion of average of opening and closing value of Grant and contribution and GFA for FY 2010-11.
Table 28: Approved Depreciation (Rs. Cr.) for FY 2010-11
Sl. 1 2 3
Particulars Depreciation Less: Depreciation on the assets created out of Grant, consumer contribution Net Depreciation
FY 2010-11 (Approved) 75.72 75.72
As per BSEB petition FY 2010-11 89.00 89.00
Now approved in True-up for FY 2010-11 90.45 29.92 60.53
4.14.3 Accordingly, the Commission approves depreciation expenses of Rs. 60.53 Cr. for FY 2010-11 during the truing up process for FY 2010-11.
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4.15
Interest and Finance Charges Petitioners submission
4.15.1 BSEB in its true-up petition has submitted that the Interest and Financial Charges incurred by it during the year for various purposes like capital expenditure, normal working capital, meeting revenue deficit etc. The submission by BSEB is outlined in the table below.
Table 29: Interest & Financial Charges as per the petition for FY 2010-11 (Rs. Cr.) Opening Closing Nature of Loan Addition Repayment Loan Loan Capital Expenditure Revenue Deficit Revenue Deficit Capital Expenditure Capital Expenditure Capital Expenditure Capital Expenditure Capital Expenditure Capital Expenditure Capital Expenditure Capital Expenditure Capital Expenditure Working Capital Working Capital Working Capital Working Capital Working Capital
Institution State Govt
Interest
(a) Plan Loan (b) Non plan loan (c) Bonds issued to CPSUs REC RGGVY LIC L.D. bank under ARDC IDBI CEA PFC Public Bond Centrally Sponsored Schemes (Loans are not allocated to BSEB by State Government) Working Capital Loan Consumer Security Deposit Consumer Rebate Interest to supplier/contractor Other Charges Total
1,460.96 3,558.44 2,143.33 93.50 5.23 0.06 245.82 -
805.94 44.06 105.06 58.37 -
22.49 8.04 35.63 -
2,266.90 3,602.50 2,143.33 71.01 102.26 0.06 268.57 -
254.86 487.88 176.43 12.82 36.03 27.66 -
887.97 8,395.32 1,805.58
722.35 1,735.79 969.37
66.16 66.16
1,610.32 10,064.95 2,708.80
97.39 9.98 30.77 0.30 0.01 1,132.94 331.37
Loans used for Capital Expenditure
4.15.2 BSEB has further submitted that prior to the Tariff Regulations, 2007, tariff were not sufficient enough to meet its expenditures and hence BSEB was making loss and also not able to make repayment of loans. Further, BSEB has identified the loans
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used for the capital expenditure and working capital and only asked the interest & financial charges for the loans used for the capital expenditure work. 4.15.3 As per the provisions of Tariff Regulations, 2007, BSEB has requested the Commission to approve net interest & financial charges of Rs. 331.37 Cr., taking into consideration Rs. 25 Cr. as the actual interest capitalised during FY 2010-11, for the loans raised for capital expenditure. 4.15.4 Further, in response to the Commission letter vide letter no. No. BERC-Tariff-24/1188 dated 27th January, 2012, the Board vide letter no. Com/ Tar-132/2011-375, dated 01.03.2012 explained the reason of mismatch between the details of loan as given under Table 12 of the petition and the schedules of the annual accounts for FY 2010-11 of the Board as under: 34 The REC Normal/RMNP loans up to the year 2001-02 is being repaid as per schedule of payment fixed by REC under one time settlement scheme. However, the accounting entries of OTS Scheme were not incorporated in the accounts of the Board earlier. Now the same has been accounted for in schedule -32 of the Annual Accounts of the Board. Consequently though nil amounts have been received under REC Normal Scheme but a sum of Rs 83, 45, 02,695/- has been shown as receipt during the year only for rectification of REC Account. Similarly, a sum of Rs 19, 28, 80,068/- only has been repaid during the F Y 2010-11 but a sum of Rs1,05,94,18,777/- has been shown in repayment during the year only for rectification of REC Account. Commissions Analysis 4.15.5 On scrutiny of the petition and the additional information furnished by the Board, the Commission observed that the loan amounts also included the payments due on capital liabilities which are created on account of defaults in the repayments done by BSEB in the past. As mentioned previously, the Commission does not agree to this treatment as the burden on account of defaults in making repayments should not be passed on to the consumers. 4.15.6 Further, the Commission has also taken into cognizance the fact that the interest booked by the Board under the head Interest and Finance Charges may also include the penal or additional interest incurred by the Board for defaulting on making timely repayments. Accordingly, the Commission will keep the above fact in mind while approving the Interest and finance charges. The Commission notes with concern that the Petitioner is diverting its long-term fund for the purpose of meeting its deficit caused due to its own inefficiencies. The Commission directs the Petitioner to abstain from diversion of funds meant for creating long-term assets.
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4.15.7 In absence of the adequate data/ information with BSEB regarding the details of the capital expenditure incurred during the year, its funding, capitalisation of assets, etc., the Commission has adopted the same methodology as applied while truing up of costs for FY 2006-07 to FY 2009-10. The Commission has used the normative closing balance of loan (Rs. 465.53 Cr.) as arrived in true up of FY 2009-10 as the opening outstanding loans as on 1st April 2010 for computation of Interest and finance charges for FY 2010-11. 4.15.8 The Commission has also outlined the methodology adopted for estimating the additional borrowings during the FY 2010-11 for funding the assets getting capitalised during the year after considering the amount available in the form of consumer contributions and grant / subsidy towards cost of capital assets during the year as well as balance amount (- Rs. 5.74 Cr.) of contribution, Grants and subsidies towards cost of capital assets to be capitalised in subsequent years. The amount of Rs. Rs. 5.74 Cr. was arrived at while truing up of FY 2009-10 wherein the Commission had stated that 5.17.15 As can be seen from the above, the consumer contribution, grants / subsidies towards cost of capital assets received during the year is much more than the assets capitalised during the year. Based on the same, the assets capitalised during the year are assumed to be entirely being funded through the consumer contribution, grants / subsidies towards cost of capital assets received during the year and hence, there is no requirement of loan funding against assets capitalised during the year. After accounting for the same, the remaining quantum of Rs. 5.73 Cr. against consumer contribution, grants / subsidies towards cost of capital assets received during the year is assumed to be used for funding assets being capitalised in the subsequent years. 4.15.9 In the absence of the adequate data with BSEB the Commission has considered the repayment during the year as per the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 reproduced as below: The repayment for the year of the tariff period 2009-14 shall be deemed to be equal to the depreciation allowed for that year 4.15.10 Based on the above methodology, the opening loan as on 1st April 2010 considered for computing interest cost for FY 2010-11 has been taken equal to closing
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normative loan for FY 2009-10 as Rs. 465.53 Cr. as per the true-up order issued by the Commission on 27th January 2012 for FY 2009-10. 4.15.11 The BERC Tariff Regulations provide for recovery of interest and finance charges on loans which have been utilised to create assets and are eligible for recovery only after the assets have been put to use. The normative outstanding loan as on 1st April 2010 is considered to be used for creation of assets which have been put to use and hence the interest against this loan is considered for recovery from consumers. In addition to this, there will be certain additional loans which will be eligible for recovery of interest on account of capitalisation of assets achieved during the FY 2010-11. 4.15.12 The assets capitalised during the year comprises of a combination of assets created out of the CWIP at the beginning of the year and part of the assets capitalised during the year are created out of investments done during the year itself. This break-up is not available in the audited annual accounts. While, it is desirable to understand the bifurcation of these assets capitalised i.e. assets created out of capitalisation of CWIP at the beginning of the year and those created through capitalisation of investments done during the year, the same may not be possible looking at the availability of information with the Commission and from the data made available by BSEB. 4.15.13 Accordingly, the Commission has considered the assets capitalised during the year as being first funded through the consumer contributions and grants/subsidy towards capital assets received during FY 2010-11 and the remaining portion of the assets getting capitalised during FY 2010-11 is assumed to be funded through additional loans received during FY 2010-11. At the same time, any amount of contribution and grants / subsidy towards capital assets available after this adjustment will be considered as having funded assets which would be capitalised in the subsequent years. While, the Commission understands that this method has its own limitations, however, the Commission has no other option but to adopt this method till the time BSEB is able to improve the availability of information to enable the Commission to approve the interest expenses based on actual information. 4.15.14 Based on the above, the methodology for determining the additional loans drawn during the year and eligible for recovery of interest charges based on the above discussion is exhibited in the table below:
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Table 30: Estimation of loan against assets getting capitalized during FY 2010-11 (Rs. Cr)
Particulars Total Assets Capitalised During the year (A) Contribution, Grants and subsidies towards Cost of Capital Assets during the FY 2010-11 (B) Balance contribution, Grants and subsidies towards Cost of Capital Assets (As per True up Order for FY 2009-10) (C) Estimated Funding through Loans (A B C)
Amount 991.27 919.05 5.74 66.49
4.15.15 As can be seen from the above, the consumer contribution, grants / subsidies towards cost of capital assets received during FY 2010-11 and the balance of the consumer contribution, grants / subsidies towards cost of capital assets taken from true up order for FY 2009-10 is considered as the assets capitalised during the year funded through grant and the balance capitalisation of Rs 66.49 Cr. is treated as funded through loan. 4.15.16 In line with the methodology adopted in the truing up for the FY 2006-07 to FY 200910, the Commission has approved an effective interest rate of 12.70% for the FY 2010-11. The details are as given in the table given below.
Table 31: Computation of effective Rate of Interest for FY 2010-11 (Rs. Cr.)
Loan type Opening Balance Additions Repayment Closing Balance Interest Average Loan during the year Average Rate of Interest
State Government Loans (Plan) 1,460.96 805.94 0.00 2,266.90 215.93 1,863.93 11.58%
REC 98.74 193.74 27.33 265.16 48.85 181.95 26.85%
PFC 245.82 58.37 35.63 268.57 27.66 257.19 10.76%
Total 1,805.52 1,058.06 62.95 2,800.62 292.43 2,303.07 12.70%
4.15.17 As per the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 as mentioned in clause 3.14.10, the repayment has been considered to be equal to the depreciation allowed for that year. 4.15.18 On the basis of the methodology mentioned above, the Commission approves the interest and finance charges for FY 2010-11, as given in the table below:
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Table 32: Approved Interest and finance charges for FY 2010-11 (Rs. Cr.)
Particular Opening Balance of loan (As per True up Order for FY 2009-10) Additions to Loan Repayment Closing Balance Average Loan during the year Interest Rate Interest & Finance Charges
Amount 465.53 66.49 60.53 471.49 468.51 12.7% 59.49
4.15.19 Accordingly, the Commission approves the interest and finance charges of Rs.59.49 Cr. for the FY 2010-11. 4.16 Interest on Working Capital Petitioners submission 4.16.1 The BSEB has submitted that the BERC (Terms and conditions for determination of Tariff) Regulations, 2007 provide for recovery of the interest on working capital from the consumers on a normative basis. The principles for this normative computation have been prescribed in the regulations and are different for generation function and transmission & distribution function. 4.16.2 BSEB has submitted that it has calculated the interest on Working Capital based on the normative principles outlined by the Commission in its Tariff Regulations, 2007 and sought for approval of the same from the Commission. 4.16.3 The Petitioner has submitted the details of interest on working capital requirement for FY 2010-11 in the formats submitted along with its petition. As per the submission, the Petitioner has considered the following components for calculating its interest on working capital requirements:
Table 33: Proposed Interest on working capital for FY 2010-11 (Rs. Cr.)
Sl. 1 2 3 4 5 6 7
Particulars Two (2) months of Fuel cost (Primary and Secondary) One month O&M expenses of BSEB Receivables (two (2) months of fixed and variable charges of BSEB) Maintenance spares (@ 1% of GFA escalated at 6% per annum) Total Working Capital Requirement Interest Rate (SBI PLR as on 1st April, 2010) Interest on Working Capital
FY 2010-11 (Actual) 11.06 70.47 654.27 48.60 784.39 11.75% 92.17
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Commissions Analysis 4.16.4 BSEB has included the resource gap grant received from the State Government in the form of payment of part of power purchase cost to NTPC as receivable for the purpose of calculation of working capital. State Government has paid part of power purchase cost to NTPC directly and treated it as resource gap grant to BSEB. Commission observes that BSEB does not have to arrange working capital for payment of this amount to NTPC and therefore, it should not be included in two months receivable for the purpose of calculation of working capital. 4.16.5 The State Govt. makes the payment of power purchase cost directly to NTPC on receipt of the bill every month. Only the balance amount of the power purchase received from NTPC is paid by BSEB from its working capital and receivables. BSEB does not have to arrange working capital for payment to NTPC the amount which is paid directly by the State Govt. to NTPC. Therefore, the payment made by the State Govt. directly to NTPC should not be included in two months receivables of BSEB as part of the working capital requirement. Similarly, in the true up exercise for the period of FY 2006-07 to FY 2009-10 also, the resource gap grant received from the Government has not been considered as receivable for the purpose of computation of interest on normative working capital. 4.16.6 As per the BERC (Terms and conditions for determination of Tariff) Regulations, 2007, Maintenance spare is calculated as Maintenance spares at 1% of the historical cost escalated at 6 % per annum from the date of commercial operation. 4.16.7 The Commission has used the same approach as used while truing-up of ARR for the period of FY 2006-07 to FY 2009-10. The Commission has used 1% of closing balance of GFA of FY 2005-06 as the base and escalated it at 6% for four (4) years to calculate the spares for FY 2010-11. To this base figure, 1% of the addition in GFA each year escalated at 6% per annum is added to calculate the total Maintenance spares. 4.16.8 Accordingly, based on the principles specified in the BERC (Terms and conditions for determination of Tariff) Regulations, 2007, the information available in the audited annual accounts and the observation of the Commission, the Commission approves the Interest on Working Capital of Rs.52.25 Cr. as against that of Rs. 92.17 Cr. submitted by BSEB for FY 2010-11 as shown in the table below.
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Table 34: Summary of approved Interest on working capital (Rs. Cr.)
Sl. 1 2 3 4 5 6 7
Particulars Two (2) months of Fuel cost (Primary and Secondary) One month O&M expenses of BSEB Receivables (two (2) months of fixed and variable charges of BSEB) Maintenance spares (@ 1% of GFA escalated at 6% per annum) Total Working Capital Requirement Interest Rate (SBI PLR as on 1st April, 2010) Interest on Working Capital
Now approved in True-up for FY 201011 9.78 56.39 336.58 38.92 441.65 11.75% 51.89
4.16.9 Therefore, the Commission approves Rs. 51.89 Cr. as the interest on working capital for FY 2010-11. 4.17 Return on Equity (ROE) Petitioners submission 4.17.1 Bihar State Electricity Board is an integrated electricity utility constituted under Clause 5, Chapter III of The Electricity (Supply) Act, 1948. The Board is mainly funded through loans and grants from the Government of Bihar, loans and grants under specialized funding schemes of the Government of India and loans from commercial lending organizations. 4.17.2 BSEB has requested the Commission to approve a reasonable return at the rate of 14% on the capital grant provided by the State Government. It has submitted that as BSEB is a board and not a company so the equity contribution can come only by way of Grant and not equity. In view of the same, the Commission is requested to provide reasonable return on the capital provided by the State Government. Accordingly, BSEB has sought approval for Return on Equity of Rs 213.32 Cr. for the purpose of true-up of FY 2010-11. Commissions Analysis 4.17.3 The Commission had not approved any Return in Equity for BSEB in the Tariff Order issued for FY 2006-07 or FY 2008-09 or during the review process undertaken for the FY 2006-07 or FY 2008-09. BSEB also had not sought any return on equity in its tariff petition for FY 2010-11.
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4.17.4 The Commission is of the view that Return is admissible only on equity actually deployed for the creation of assets. Since, BSEB has not been corporatized; it does not have any equity. The Commission has considered entire assets base funded through loan/ grant and accordingly interest has been allowed. 4.17.5 Accordingly, the Commission continues with the stand taken in the past Tariff Orders and no Return on Equity is permitted for BSEB in truing up of FY 2010-11. 4.18 Taxes
4.18.1 BSEB submitted that there are no expenses under this head for FY 2010-11 hence no expense is being claimed under Taxes. 4.19 Other Debits & Extraordinary Items Petitioners submission 4.19.1 The Petitioner submitted that the expenses incurred under head of other debits & extraordinary items by BSEB for FY 2010-11 are Rs. 0.17 Cr. hence requested the Commission to allow the same. Commissions Analysis 4.19.2 The Commission approves Rs. 0.17 Cr. under the head Other Debits & Extraordinary Items based on the audited annual accounts of FY 2010-11. 4.20 Prior Period Credits / (Charges) Petitioners submission 4.20.1 BSEB in its true-up petition has stated that the Commission has started issuing Tariff Order from FY 2006-07 and hence any expense/income incurred/accrued and not accounted in respective year but considered in future year as prior period credits/ (charges) should be adjusted while calculating ARR. As the Commissions first Tariff Order was issued for FY 2006-07 and hence BSEB has only considered expense/income incurred/accrued after 1st April, 2006. 4.20.2 Based on the above discussed principal, BSEB has calculated prior period credits/ (charges) for FY 2010-11. Prior Period Credits/ (Charges) for FY 2010-11 are Rs. 312.20 Cr., out of this, Rs. 263.49 Cr. of income comprises of FPPCA charges for
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Oct2009 to Dec2009, additional supply of power to rural areas to meet drought situation in 2009-10 and power purchase from sugar mills. Commissions Analysis 4.20.3 The Commission had sought clarification from BSEB regarding the nature of these charges to enable the Commission to take appropriate decision. In response, BSEB has submitted the bifurcation of Rs. 263.49 Cr. is as below: Rs. 90 Cr. FPPCA support from State Government; Rs. 171.90 Cr. support from agriculture department for additional supply of power to rural areas to meet drought situation in FY 2009-10 Rs. 1.59 Cr. support from State Government for power purchase from sugar mills
4.20.4 The detailed break-up of the prior-period items has been submitted by the Board vide letter No. Com/Tar-132/2011-375 dated 01.03.2012 as mentioned below:
Table 35: Prior Period Credits / (Charges) for the FY 2010-11 (Rs. Cr.)
Particulars Employee cost Misc. receipt A&G expenses Depreciation Interest payable on REC loan Fixed deposit Power Purchase Subsidy and Grant Interest on consumer security deposit Fuel related Sundry debtors Interest on consumer security deposit O&M and Fuel supplier Interest in State Govt Loan Interest payable on REC loan Interest on consumer security deposit Insurance charges Assets not in use Total
Amount (0.32) 39.30 (8.75) (4.17) 43.74 68.72 (45.18) 263.49 (6.08) (21.02) (2.09) (0.78) (0.09) (0.91) (18.36) (12.08) (1.41) (3.61) 290.41
4.20.5 Accordingly, the Commission approves the Prior Period Credits of Rs. 290.41 Cr. for the FY 2010-11.
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4.21
Non-Tariff Income Petitioners submission
4.21.1 The Petitioner in the true-up petition of FY 2010-11 submitted the non-tariff income as Rs. 44.73 Cr. for FY 2010-11 as below:
Table 36: Proposed Non-Tariff Income (Rs Cr.) for FY 2010-11
Particulars Non-Tariff Income
FY 2010-11 (Approved) 172.08
FY 2010-11 (Actual) 44.73
4.21.2 The Petitioner has also submitted that it has proposed all other values as per audited annual accounts of the Board except for delayed payment surcharge from consumers, for which the Petitioner has requested that the DPS may not be considered while considering Non-Tariff Income for the purpose of ARR determination. 4.21.3 The Petitioner has submitted that for the purpose of ARR determination revenue from tariff is considered on accrual basis i.e. amount billed by BSEB. However the Board is not able to collect the entire amount and the revenue collected (cash basis) is lower than the amount billed. In order to fund this gap (receivables so created), BSEB has to borrow higher amount (than allowed by the Commission) for its increased working capital requirement. The delayed payment surcharges are payable by the consumers on such unpaid amounts. In the Annual Accounts the revenue (on the income side) is on billed basis (accrual) but the borrowings for increased working capital also get reflected as increased interest cost under the Interest and Finance Charges account. Thus in a way Delayed Payment surcharges are sources of fund for funding this increased working capital. Further, the Board has submitted that the Commission considers revenue on accrual basis and the working capital requirement though computed on normative basis does not take into consideration the increased receivable (beyond the norms of 2 month) amount that has to funded by BSEB. If BSEB were to collect the entire amount that it has billed there would be no income from surcharge (no receivable would exists) however the Commission considers income from DPS. BSEB on this account is doubly penalized. The income is considered on accrual basis and simultaneously DPS is also considered in the ARR.
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Commissions analysis 4.21.4 The Commission has adopted the approach on Non-tariff income in line with the recent judgement of Honble Appellate Tribunal for Electricity (APTEL) dt. 12.07.2011 in Case no 142 & 147 of 2009. 4.21.5 The relevant extracts of the Judgment are reproduced below: The normative working capital compensates the distribution company in delay for the 2 months credit period which is given to the consumers. The late payment surcharge is only if the delay is more than the normative credit period. For the period of delay beyond normative period, the distribution company has to be compensated with the cost of such additional financing. It is not the case of the Appellant that the late payment surcharge should not be treated as a non-tariff income. The Appellant is only praying that the financing cost is involved due to late payment and as such the Appellant is entitled to the compensation to incur such additional financing cost. Therefore, the financing cost of outstanding dues, i.e. the entire principal amount, should be allowed and it should not be limited to late payment surcharge amount alone. Further, the interest rate which is fixed as 9% is not the prevalent market Lending Rate due to increase in Prime Lending Rate since 2004-05. Therefore, the State Commission is directed to rectify its computation of the financing cost relating to the late payment surcharge for the FY 2007-08 at the prevalent market lending rate during that period keeping in view the prevailing Prime Lending Rate. 4.21.6 As per audited annual accounts of the Board for FY 2010-11, the Non-Tariff Income of BSEB is Rs. 161.63 Cr. out of which, Delayed Payment Surcharge from Consumers is Rs. 24.31 Cr. As the Petitioner charge DPS @ 18% per annum (1.5% per month), the principal amount on which DPS has been charged will be 135.08 Cr. 4.21.7 As prevailing SBI PLR as on April 1, 2009 was 12.25%, the Commission has allowed the financing cost for DPS @ 11.75%. The financing cost approved by the Commission is shown below:
Table 37: Funding of DPS (Rs. Cr.)
Particular DPS as per audited annual accounts of FY 2010-11 (@ 1.5% per month) (A) Principal amount on which DPS was charged (B = A / 18%) Interest Rate for funding of Principal of DPS Interest on funding of Principal amount of DPS
FY 2010-11 24.31 135.08 11.75% 15.87
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4.21.8 The Commission has sought additional information vide its letter No. BERC-Tariff24/11-272 dated 23.03.2012 seeking information on actual DPS collected by the Board. However, the Board has replied vide letter no. Com/ tariff-161/11-488 dated 23.03.2012 saying that the same is not available as of now and shall be made available only once the IT based billing system is implemented under the ongoing RAPRDRP Scheme. 4.21.9 The Commission is not satisfied with the justification given by the Board for not maintaining records for actual revenue receipts against DPS. The Commission directs the Board to submit the same as per actuals in its subsequent filings/ true-up petitions, in the absence of which the Commission shall consider 100% DPS as nontariff income for the purpose of calculation of the ARR. 4.21.10 Hence, the Commission has computed the amount of Non-Tariff Income as summarised below:
Table 38: Trued-up Non-Tariff Income approved (Rs. Cr.)
Particular Non-Tariff Income as per the Audited Annual accounts Interest on Staff Loan & Advance Income from Investment (F.D) Interest on Loan & advance to licensees D.P.S from Consumer Interest on advance to Supplier/Contractor Interest from Bank (Other than F.D.) Income from Trading Income from Staff Welfare activities Miscellaneous Receipt Rebate and discount Received Incentive for timely payment of power purchase bills Incentive for timely payment of installment against Loan to PFC Meter Rent/Service Line Rental Miscellaneous Recoveries Total Non-Tariff Income Less: Financing cost of Principal amount of D.P.S. Net Non-Tariff Income
FY 2010-11 0.03 92.59 24.31 1.82 1.05 3.45 3.06 1.16 0.44 18.88 14.83 161.63 15.87 145.76
4.21.11 Therefore, the Commission approves Rs. 145.76 Cr. as Non-Tariff Income for FY 2010-11, against the Petitioners claim of Rs. 44.73 Cr.
Table 39: Non-Tariff Income (Rs. Cr.)
Particular
Petitioners Submission
Now approved in True-up for FY 2010-11
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Particular Non-Tariff Income
Petitioners Submission 44.73
Now approved in True-up for FY 2010-11 145.76
4.22
Revenue from the sale of Power Petitioners submission
4.22.1 BSEB has requested the Commission to approve the total Revenue from the sale of Power of Rs 2375.97 Cr. as per the audited annual accounts of BSEB. 4.22.2 The Commission while approving the revenue from sale of power has also considered the revenue on account of FPPCA charges as approved by the Commission vide FPPCA order for the period of Oct'08 to Mar'09 issued in the month of Mar'10 and FPPCA order for the period of Apr'09 to Sep'09 issued in the month of May'10 for an aggregate of Rs. 384.77 Cr.. 4.22.3 Further, the Commission vide letter no. No. BERC-Tariff-24/11-88 dated 27th January, 2012, enquired from the Board about treatment of Rs. 384.77 Cr.. The Board in response has explained the reason for not considering billing Rs. 384.77 Cr. on account of FPPCA vide letter no. Com/ Tar-132/2011-375, dated 01.03.2012 as under: As against the order of the Honble Commission for recovery of FPPCA charges for the period from Oct2008 to Sept2009, amounting to Rs. 385 Cr.. The Board received Rs. 90 Cr. as Grant from State Government during FY2010-11 against the aforesaid sum. The Board was supposed to bill Rs. (384-90) Cr. = Rs.295 Cr. .
Accordingly, the field offices were asked to bill FPPCA in 5(five) equal monthly instalments vide letter dated 11.12.2010. As such, one instalment amounting to Rs. 59 Cr. approximately was envisaged to be billed every month. Consequently, the Board had to bill Rs.235 Cr.. However, due to higher T&D loss in comparison to trajectory set by the Honble Commission, the Board could not bill approx. Rs. 17 Cr. to the consumers on account of disapproved billed units accruing beyond normative T&D loss allowed in the formula for FPPCA prescribed by the Honble Commission in the Tariff Order. As such, the billable units to the consumers came to Rs. (235-17) Cr.= Rs.218 Cr. only during FY2010-2011. The field offices were instructed to bill the FPPCA charges in the mid of December 2010 (i.e. 11.12.2010). So the field offices and billing agencies took one month in implementing the changes in billing software to incorporate FPPCA related changes. Accordingly, FPPCA was charged effectively only in two months energy bills. Accordingly, BSEB could bill only Rs 115.78 Cr. to
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the consumers during FY 2010-11. As such, BSEB could bill Rs.115.79 Cr. only during FY2010-11 against billable amount of Rs. 115.79 Cr.. Billing done during FY 2010-11 under FPPCA is provided in Annexure B. However, the left over amount have been billed during the following FY2011-12. The chronology of the FPPCA charge actually became leviable from consumers leading to lower billing are as follows: FPPCA order for the period Oct08 to Mar09 was given by the Honble BERC on 31.03.2010 to recover FPPCA charges provisionally @ 69 paise/unit and cost works out to be Rs. 173.97 Cr. FPPCA order for the period Apr09 to Sept09 was given by the Honble BERC to recover FPPCA charges provisionally @ 69 paise/unit and cost works out to be Rs. 210.80 Cr. Total Rs. 385.77 Cr. recoverable from the consumers. Government pays Rs. 90 Cr. to BSEB. The recoverable amount gets reduced to Rs. 295 Cr.. The amount to be billed in five (5) monthly instalments of Rs. 59 Cr. per month. No billing could be done for the month of December,2010. As such, the billing was to be done for Rs. 295 Cr.- Rs.59crores= Rs. 235 Cr.. However, due to higher T&D loss in comparison to trajectory set by the Honble Commission, the Board could not bill approx. Rs. 17 Cr. to the consumers on account of disapproved billed units accruing beyond normative T&D loss allowed in the formula for FPPCA prescribed by the Honble Commission in the Tariff Order. As such, the billable units to the consumers came to Rs. (235-17) Cr.= Rs.218 Cr. only during FY2010-2011. The field offices could bill the consumers in the month of January2011, February2011 and March 2011 only. This implies that the billable amount against Rs. 218 Cr was reduced to Rs.(218-59) Cr.= Rs. 159 Cr.. BSEB could bill only Rs 115.78 Cr. to the consumers during FY 2010-11 as against Rs. 159 Cr. since some field offices could not commence billing in the month of January, 2011 and also due to delayed change in billing softwares.
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Commissions analysis 4.22.4 The Commission has allowed BSEB to recover FPPCA charge provisionally at the rate of 69 paise (sixty nine paise) per unit on the energy consumption during the period October, 2008 to March, 2009 and April, 2009 to September, 2009 from its consumers except Kutir Jyoti/ BPL (Rural and Urban) and Pvt. Agriculture consumers through its FPPCA orders during FY 2010-11 as mentioned below
Table 40; Details of FPPCA order issued by Commission during FY 2010-11
Period of FPPCA October, 2008 to March, 2009 April, 2009 to September, 2009 Gross billable FPPCA during FY 2010-11
Date of issue of FPPCA Order 30 Marc10 19 May'10

th th
Amount (Rs. Cr.) 173.97 210.80 384.77
4.22.5 Despite the fact that the Commission has issued the FPPCA order in the month of Mar10 and May10 with the option for BSEB to recover the FPPCA amount of Rs. 384.77 in six (6) monthly instalments, however, the Board could not bill the said amount to its consumers. 4.22.6 The Commission is of the opinion that, the Board was given sufficient time to recover the FPPCA amount of Rs. 384.77 Cr. during the FY 2010-11 itself. However, due to the in-efficiency of the Board in terms of their billing process the Board could not bill the said amount in totality during FY 2010-11. Accordingly, the Commission has not passed on the in-efficiency of BSEB to the consumers and has considered Rs. 384.77 as accrued to BSEB during the FY 2010-11. 4.22.7 The Commission shall take appropriate adjustment while truing-up of ARR for FY 2011-12 provided the BSEB is able to substantiate the total billing against the FPPCA charges approved for FY 2010-11 on actual/ billed basis. 4.22.8 Further, the Commission is of the view that the Boards inability to bill the FPPCA charges approved for the FY 2010-11 during the year may create revenue gap and incidental carrying costs which would be passed on to the consumers unnecessary. Accordingly, the Commission has considered Rs. 178.98 Cr. as deemed to be accrued under the head of FPPCA charges and has added the same to the revenue from sale of power for FY 2010-11.
Table 41: Revenue through FPPCA (Rs. Cr.)
Parameter Total Revenue to be billed through FPPCA charges during FY 2010-11
Amount 384.77
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Parameter FPPCA support from State Government Revenue recovered through Fuel cost adjustment charges as per audited Annual Accounts of FY 2010-11 Balance amount to be recovered through consumers on FPPCA head
Amount 90.00 115.79 178.98
4.22.9 The Commission approves the revenue from sale of power of Rs. 2554.96 (Rs. 2375.97 + Rs. 178.98) Cr. for the FY 2010-11 as per audited annual accounts and FPPPCA orders issued in this regard. 4.23 Grant / Revenue Subsidy from State Government Petitioners submission 4.23.1 BSEB in its true-up petition for the FY 2010-11 has requested the Commission to treat the resource gap funding to BSEB by the State government as resource gap/ grant intended to first compensate BSEB for meeting the financial losses suffered by BSEB on account of the difference between actual T&D loss of BSEB and T&D loss allowed by the Commission and balance amount if any should be taken as subsidy to agriculture and rural consumers of BSEB. 4.23.2 BSEB has submitted that it has not been able to meet the loss trajectory as approved by the Commission on account of various reasons including condition of the network, defective consumer meters, unmetered consumers, massive and large scale electrification of villages under RGGVY scheme leading to expansion of rural distribution network, etc. BSEB has further submitted that though it has taken up steps towards improving the performance, the results have not been as per the requirement. 4.23.3 BSEB has further submitted that the Commission has also appreciated this fact in its Tariff Order for FY 2011-12 dated 1st June, 2011, while disallowing the request of BSEB for re-fixing higher T&D loss reduction trajectory, at para 4.3.3 observing that if BSEB is not able to meet loss reduction trajectory due to implementation of Government sponsored RGGVY scheme, then it should ask for subsidy to compensate for the increased T&D losses. BSEB being a Government of Bihar entity, the un-bridged expenditure gap has to be met either by revenue income from tariff fixed by the Commission for the different categories of consumers or to be met as subsidy/resource gap by the Government of Bihar.
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4.23.4 Accordingly, BSEB had approached the Government of Bihar for financial assistance to bridge the resource gap arises out of increasing T&D losses. The Government of Bihar has provided financial assistance to BSEB to meet the aforesaid resource gap which was Rs. 90 Cr. per month in FY 2010-11 to meet ever increasing resource gap on account of expanding rural network and consequent increasing T&D losses beyond allowed trajectory of T&D losses. 4.23.5 BSEB has further contended that while determining ARR, the Commission had considered this resource gap funding by the Government of Bihar as income to BSEB treating it as subsidy to consumers by the Government of Bihar and to that extent all the consumers across the board are subsidised by the Commission while fixing tariff for different consumer categories. Therefore, even though BSEB receives the resource gap for meeting the revenue deficit for bridging the gap between the expenditure vis--vis revenue, BSEB remains in perpetual loss due to aforesaid treatment of the resource gap by the Commission in its Tariff Orders. 4.23.6 In line with the above submission, BSEB has requested the Commission to consider Rs. 477.30 Cr. after adjusting the disallowed power purchase cost of Rs. 602.70 Cr. as available resource gap funding for reducing the Aggregate Revenue Requirement to arrive at the revenue gap for FY 2010-11. Commissions analysis 4.23.7 The Commission has examined the contention of the Board and is not in agreement with the proposed post-facto adjustment of the revenue resource gap grant given by the State Government against the financial losses caused due to the difference between the actual T&D loss of BSEB and the T&D loss trajectory approved by the Commission. The Commission is also in receipt of the copy of the letter from the Energy Department, Govt. of Bihar dated 19/9/11 outlining the priority of use of the resource gap funding provided by the Govt. to BSEB. The views of the Commission in the matter are expressed in subsequent paragraphs. 4.23.8 The Commission has been treating the resource gap funding available from the state Govt. for reducing the ARR of BSEB thus subsidising the consumers of the state across the board. The treatment adopted by the Commission is based on the submission of BSEB in its tariff filings. Certain references in this regards from the Commissions past Tariff Orders and BSEB tariff filings are highlighted below.
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BERC Tariff Order for FY 2006-07: 6.12 GRANT FROM STATE GOVERNMENT The State Government in letter No.1412 dated 26.4.2006 communicated sanction of a grant of Rs.720 Cr. as a resource gap during 2006-07 towards payment of power purchase bills of NTPC. This grant also figures in the Volume-III of the tariff petition submitted by BSEB vide letter dated 22.05.2006. The Commission considered the Rs.720 Cr. as a resource to cover the revenue gap during 200607. Tariff Filing by BSEB in FY 2008-09: 12.0 Net Deficit 12.01 Considering the ARR for FY09 and income from existing tariff and non tariff income, the net deficit comes to Rs. 1022.83 Cr.. 12.02 State Govt. Grant State Govt. of Bihar has issued orders for release of Rs. 60 Cr. per month for payment of energy bills of NTPC during FY08. Considering that same level of grant from State Govt. ie amount of Rs. 720 Cr. will be available during FY09, then the deficit for FY09 will get reduced from Rs. 1022.83 Cr. to Rs. 302.83 Cr.. Tariff Filing by BSEB in FY 2010-11: 18.00 Net Deficit 18.01 State Govt. Grant & subsidy The State Govt. has been providing a fixed grant of Rs. 720 Cr. per year during FY07, FY08, FY09 and FY10 to meet part of resource gap. No direct subsidy to any particular category of consumers has been specified by the State Govt. However, from December 09 State Govt. is paying Rs90 Cr./month . It is expected that in FY11 the State Govt. will provide Rs 1080 Cr. to Board. The tariff rate to most of the category of consumers has been subsidised. Board is expecting that during FY11 State Govt.'s grant of Rs.1080 cores will be paid to BSEB. 18.02 Considering the ARR for FY11 and income from existing tariff and non tariff income and the state Govt. grant of Rs. 1080 Cr. the net deficit comes to Rs. 578.65 Cr.. 4.23.9 As can be seen from the above references, the revenue resource gap grant has always been proposed by the Board for reducing the net deficit in the ARR and thus reducing the average cost of supply of electricity and subsidising all categories of consumers in the state. The Commission had also aligned its approach with the
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proposal of BSEB and accordingly has already passed on the benefit of the resource gap grant received from the State Government to the consumers in the past Tariff Orders. The letter from State Government received in the past in this regards also did not mention the priority of usage as outlined in the latest letter dated 19/09/11 and only mentioned that the support is being made available for payment of power purchase cost directly to NTPC. 4.23.10 Accordingly, the Commission does not agree with the prayer of the Board to adjust the cost of dis-allowed power purchase from the resource gap grant and then use the remaining amount for subsidising the consumers. The Commission retains the resource gap assistance of Rs. 1080 Cr. received from the State Government as subsidy to consumers for FY 2010-11. The revenue gap for the FY 2010-11 will be computed considering the same. 4.24 Approved ARR and Revenue Gap for FY 2010-11
4.24.1 In view of the above analysis, the annual revenue requirement along with the revenues at existing tariffs and revenue gap for FY 2010-11 is summarized hereunder:
Table 42: Summary of Trued up ARR and Revenue gap for FY 2010-11 (Rs Cr.)
Description Power Purchase Cost Own Generation Cost Repair & Maintenance Expenses Employees Cost Admin & General Expenses Depreciation Interest & Finance Charges Interest on Working Capital Return on Equity Other Debits and extraordinary Items Less: Prior Period Credits / (Charges) Total Revenue Requirement Less: Expenditure disallowed due to higher T&D losses Less: Non-Tariff Income Net Revenue Requirement Revenue from sale of Power
FY 2010-11 (Approved) 2,635.55 64.07 95.00 660.00 38.76 75.72 184.13 3,753.23 172.08 3,581.15 2,451.49
As per BSEB True up petition 3,251.78 66.33 62.51 744.30 38.83 90.45 306.37 92.17 213.32 0.17 290.41 4,575.81 605.47 44.73 3,925.62 2,375.97
Now Approved in True up FY 2010-11 3,251.78 58.66 62.51 575.32 38.83 60.53 59.49 51.89 0.17 290.41 3,868.76 623.54 145.76 3,099.46 2,554.96
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TARIFF ORDER FOR FY 2012-13 Now Approved in True up FY 2010-11 1,080.00 (535.50)
Description Grant from Govt. Total Gap/ (Surplus)
FY 2010-11 (Approved) 1,080.00 49.66
As per BSEB True up petition 474.53 1,075.12
4.24.2 The BERC Tariff Regulations provide for Revenue gap of next year to be adjusted as a result of Review and Truing up exercises. While approving adjustments towards revenue / expenses in future years, arising out of Review / Truing up exercises, the Commission may allow the carrying costs as determined by the Commission on such expenses / revenues. However, such carrying costs shall be limited to the interest rate approved for working capital borrowings. 4.24.3 As per sub-section 87 of the Bihar Electricity Regulatory Commission (Terms and conditions for determination of Tariff) Regulations, 2007 In the case of abnormal variation in income or expenses or both, which will affect tariff substantially, the Commission may direct it to include the same, including its impact as a Regulatory asset in the tariff and also provide for its recovery through tariff for one or more years or as a surcharge for one or more years , as it may deem fit, to protect the interests of the consumers / utility/ both, unless the Commission is of the opinion that the same cannot be met fully or partially from the balance under any other consumer account, the amount of which has already taken from the consumer through tariff. 4.24.4 In light of the above provision of the BERC Tariff Regulation, the Commission is of the opinion that the BSEB was in surplus during FY 2010-11 by way of recovering more amount than what was required to be recovered from its consumers, which in a way means that the consumers have lent money to the BSEB. Further, the case of revenue surplus also indicates a situation wherein the Board would have required lesser quantum of working capital during the FY 2010-11 and in subsequent years, 4.24.5 As the Commission has genuinely compensated the BSEB by allowing carrying cost for one and half year on trued-up revenue gap for FY 2006-07 to FY 2009-10, the impact of revenue surplus should also be passed on to the Consumers in terms of interest on surplus revenue at the rate of SBI PLR to reduce the tariff burden on the consumers. Accordingly, the Commission approves interest on revenue surplus for one and half year (FY 2011-12 entire year and FY 2012-13 half year) amounting to
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Rs. 104.42 Cr. on the revenue surplus for FY 2010-11 arising on account of the truing up exercise
Table 43: Summary of the Carrying cost permitted (Rs Cr.)
Sl. 1. 2. 3. 4.
Particulars Revenue Surplus approved for FY 2010-11 to be carried forward Interest for FY 2011-12 (SBI PLR @ 11.75%) Interest for six (6) months during FY 2012-13 (SBI PLR @ 13%) Total Surplus with interest
Approved truing up surplus for FY 2010-11 (535.50) (69.62) (34.81) (639.93)
4.24.6 The trued up revenue surplus as approved by the Commission for FY 2010-11 amounts to Rs. 639.93 Cr. as against revenue gap of Rs 1075.12 Cr. proposed by the Petitioner in the true-up petition of FY 2010-11.Accordingly, the same would be carried forward to the ARR of the FY 2012-13 for adjustment. 4.24.7 The net revenue surplus to be carried forward in FY 2012-13 after the truing up exercise for FY 2010-11 is Rs 639.93 Cr.
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5 Review of FY 2011-12
5.1 5.1.1
Background BSEB filed its ARR & tariff petition for FY 2011-12 based on the actual data available of FY 2009-10. The Commission had approved the ARR & Tariff for FY 2011-12 along with regulatory asset in its Tariff Order for FY 2011-12 dated 1st June, 2011. The approval was based on prudence check of the estimates presented by the Board for costs to be incurred and revenues likely to be generated by the Board during the year. Now based on the revised estimates of expenses for FY 2011-12, BSEB has submitted the petition for review of its ARR for FY 2011-12. Subsequently, BSEB vide letter No. Com/ Tar-132/ 2011-392 dated 2nd March, 2011 submitted the audited annual accounts for FY 2010-11 along with the audit certificate issued by CAG to the Commission.
5.1.2
The Commission in this Order has carried out the review exercise for FY 2011-12 based on the revised estimates submitted by the Petitioner and the audited annual accounts of FY 2010-11, although the same shall be considered for final true-up when the audited accounts for the year are made available by the Petitioner.
5.1.3
This chapter compares the performance of the Board vis--vis the targets set in the Tariff Order approved for FY 2011-12. The performance data for FY 2011-12 have been considered from the data contained in the tariff petition for FY 2012-13.
5.2
Category wise Sales Petitioners submission
5.2.1
The Petitioner in its revised estimates has estimated the total energy sales to intra state consumers of 6099 MUs and 848 MUs of inter-state sales during FY 2011-12.
Table 44: Summary of revised Category-wise Sales (MUs) projected by BSEB for FY 2011-12 for BSEB
Sl. 1 2
Category (FY 2011-12) Kutir Jyoti Un-metered (Rural) Kutir Jyoti Metered (Rural)
Approved sales in Tariff Order for FY 2011-12 260.41
BSEB Revised estimates FY 2011-12 65.43 257.98 Page 109
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TARIFF ORDER FOR FY 2012-13 Approved sales in Tariff Order for FY 2011-12 2.66 885.72 1,424.17 28.58 574.66 6.67 263.51 134.77 204.27 73.20 143.49 3.82 34.37 962.15 288.88 110.29 929.70 496.46 6,827.78 693.67 7521.45 550.00 8071.45 BSEB Revised estimates FY 2011-12 1.29 924.86 1,217.44 0.9 20.61 506.61 15.75 271.63 166.99 162.09 104.42 60.39 5.61 26.2 1.36 798.56 351.42 125.45 276.87 566.89 5928.75 171.00 6099.75 555.00 293.00 6947.75
Sl. 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 24 25 26 27 28 29
Category (FY 2011-12) Kutir Jyoti Metered (Urban) Domestic I Domestic II Domestic III N.D.S.I (Rural) N.D.S.II (Urban) N.D.S.-III (Temple etc) IASI (Private) IASII (Government) LTISI LTISII Public Water Works Street LightI (Metered) Street LightII (Unmetered) Street LightIII HTSSI HTSSII HTSSIII HTSS RTS Sub-Total Sale from additional Power availability
Energy sales to intra state consumers

Energy outside State (Nepal) Sale in bilateral trade/UI Total Sales
5.2.2
The Petitioner submitted that there is an expected growth in number of KutirJyoti/BPL consumers to the tune of 8,86,499 on account of large scale electrification of rural areas under the RGGVY scheme undertaken by the Petitioner. The sale to these Kutir Jyoti metered consumers in the rural areas has been projected by BSEB based on consumption norm of 30 units per connection per month and average number of consumers in this tariff category. Commissions analysis
5.2.3
While scrutinizing the sales figures for FY 2011-12, the Commission has sought the latest category-wise sales figures available with the Petitioner for FY 2011-12. In
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response, the Petitioner vide letter no. Com/ tar-132/ 2011-375 dated 1st March 2012 informed the Commission that: The actual data for the period of April, 2011 to November, 2011 is not available as annual accounts are not yet finalized. 5.2.4 The Commission is of the opinion that the Board should maintain details of monthly billing and sales related information and the same must be submitted up to the immediate preceding month along with the revised estimates for the current year. The Board is directed to comply with the same in all future ARR/ Tariff filings. 5.2.5 In the absence of any better information and in view of the recent APTEL judgment dated November, 2011 directing all SERCs to endeavour to carry out review and truing up exercise on year to year basis, the Commission is considering the sales data submitted by the Board in approving the revised estimates for FY 2011-12. However, the same shall be subject to final true-up when the Annual Accounts for FY 2011-12 are made available. 5.2.6 In view of the above the Commission approves the revised estimates of sales for FY 2011-12 at 6947.75 MUs as proposed by the Board. 5.3 Transmission and Distribution Losses Petitioners submission 5.3.1 The Table below summarises the overall T&D loss levels as submitted by the Petitioner as revised estimates for FY 2011-12:
Table 45: Proposed T&D losses as revised estimates for FY 2011-12
Particular T&D Losses (%)
FY 2011-12 (Approved) 29.00 %
FY 2011-12 (Revised estimate) 42.00 %
5.3.2
The Board has informed that it has undertaken massive electrification works under the RGGVY scheme. There has been a tremendous increase in the network of BSEB in the last 2 years in the rural areas consequent to village electrification. The village electrification drive has led to an addition of large number of Kutir Jyoti consumers. Number of such consumers is expected to go up to 27 lakhs within the next two years from 5.89 lakhs in FY 2010-11. This significant expansion of the network has not only led to increase in the technical losses in the system, but has also rendered the system porous and prone to theft of electricity. Due to both these reasons, BSEB has not been able to achieve the T&D loss targets set by Commission.
5.3.3
The Board has prayed to the Commission to approve the T&D loss levels for FY 2011-12 at 42% in consideration of the existing T&D loss levels of BSEB. Further, it
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has also requested the Commission to compensate the difference between actual power purchase cost and power purchase cost calculated based on the agriculture consumption norm and T&D loss trajectory from the resource gap funding provided by the State Government. Commissions analysis 5.3.4 The Commission has fixed a target of T&D losses at 29% for the FY 2011-12 in its Tariff Order for FY 2008-09. The trajectory has already been reviewed earlier and the Commission is of the view that it is the responsibility of the BSEB to reduce its distribution losses and take appropriate measures to bring down the losses. 5.3.5 Accordingly, the Commission approves the Transmission & Distribution losses of 29% in review for FY 2011-12. The same shall be considered at the time of computation of the approved power purchase cost. 5.3.6 The table below summarises the T&D loss levels target set by Commission, T&D loss as per revised estimate of BSEB and the approved T&D loss for FY 2011-12:
Table 46: Approved T&D Loss for FY 2011-12
Particulars T&D Losses (%)
As per loss target set for FY 2011-12 by BERC 29%
FY 2011-12 (Revised estimate)

42.00%
FY 2011-12 (Approved revised estimates) 29%
5.4
BSEBs Own generation Petitioners submission
5.4.1
BSEB owned and operated only one thermal generating plant i.e. Barauni Thermal Power Station (BTPS) located at Barauni. The total installed capacity of the BTPS in FY 2010-11 was 320 MW. The current status of all units of BTPS is summarized in the table below for reference:
Table 47 : Current Status of different units of BTPS
Unit I II III IV V
Unit capacity Date of (MW) Commissioning Retired Retired Retired 50 50 N/A N/A N/A 9/11/1969 1/12/1971
Current status Retired since 17.02.1983 Retired since 26.11.1985 Retired since 05.10.1985 Shutdown since 24.04.1996 Shutdown since 15.03.1995
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Unit VI VII
5.4.2
Unit capacity Date of (MW) Commissioning 110 110 1/12/1984 31/03/1985
Current status Unit working at de-rated capacity; Dismantling of the Unit and its R&M work is planned from Jul12 Under shutdown; R&M is underway; Expected to come in operation from Jul12
The Board has also submitted that, Units I, II and III were retired long back i.e. before 1985. Out of the remaining four units, unit number IV and V are over 42 and 40 years old respectively and have completed their useful economic life. These Units are under shutdown for over 17 years. At present Unit VII is under shutdown and undergoing Renovation & Modernization (R&M) work for revival. Dismantling of the Unit VI for R&M work is planned from July 2012 while R&M of Unit VII is expected to be completed by June 2012.
5.4.3
BSEB has submitted that the station heat rate (SHR) is expected to improve from FY 2010-11 level of 4103 kCal/kWh to 4000 kCal/kWh for FY 2011-12. The Board has submitted that the coal price in FY 2010-11 was Rs. 1823 per MT but in recent time it has witnessed steep hike and has reached the level of Rs. 3317 per MT in month of August, 2011. Hence coal price for FY 2011-12 is expected to be on higher side from the level of FY 2010-11. Other fuel related cost is projected in the ratio of other fuel related cost to fuel cost in FY 2010-11.
5.4.4
The assumptions and norms used by BSEB for projection of own generation cost is summarized in the table below:
Table 48: Proposed Plant parameters & Fuel cost determinants for BTPS
Parameters Gross Units Generated Auxiliary Consumption Net Generation Capacity Derated Capacity Plant Load Factor Auxiliary Consumption Station Heat Rate Sp. Oil Consumption Gross Calorific Value of Coal Calorific Value of Oil Overall Heat Heat from Oil
Units MU MUs MUs MW MW % % kcal/kWh ml/kWh kcal/kg kcal/l G Cal G Cal
FY 2010-11 (Actual) 220.44 39.56 180.88 220 220 11.44% 17.95% 4,103 31.48 3,858 9,950 904,534 69,046
FY 2011-12 (Approved) 300.00 30.00 270.00 105 105 32.62% 10.00% 4,316 10.00 4,284 10,000 1294878 30,000
FY 2011-12 (RE) 202.00 30.30 171.70 220 220 10.45% 15.00% 4,000 35.00 3,800 9,996 808,009 70,671
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Parameters Heat from Coal Transit losses Actual Oil Consumption Actual Coal Consumption Specific Coal Consumption Price of Coal Price of Oil Coal Cost Oil Cost Fuel Cost Other Fuel Related costs Total Fuel Costs Total Fuel Cost/Gross Generation Total Fuel Cost/Net Generation
Units G Cal % kl MT kg/kWh Rs./MT Rs/kl Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs/unit Rs/unit
FY 2010-11 (Actual) 835,488 6,939 216,560 0.98 1,823 31,388 39.48 21.78 61.26 5.06 66.32 2.78 3.39
FY 2011-12 (Approved) 12,64,878 3.80% 3000 3,06,948 1.02 2,328 30,000 71.46 9.00 80.46 80.46 2.68 2.98
FY 2011-12 (RE) 737,337 7,070 194,036 0.96 2,600 50,780 50.45 35.90 86.35 7.13 93.48 4.63 5.44
5.4.5
BSEB revises its estimate of fuel cost for FY 2011-12 to Rs. 93.48 Cr. against Rs. 80.46 Cr. approved by the Commission.
5.4.6
The Commission vide letter No. BERC- Tariff 24/11- 825 dated 21st December, 2011 enquired about the generation related data and information of BTPS Barauni such as actual generation, performance parameters, month wise projected generation and performance parameters, reasons of non-achievement of
performance parameters during FY 2010-11 and FY 2011-12 (upto Nov11) despite investment under R&M head etc. The Commission also sought clarification on the high generation cost of power from BTPS despite investment on R&M, actual coal Transit loss and the basis for steep hike proposed for FY 2011-12 (RE) in Coal and Oil price. 5.4.7 On non-achievement of performance parameters during FY 2010-11 & FY 2011-12 (upto December 2011), the BSEB has submitted that it is due to non-completion of R&M work of unit VII. Unit VI is in operation after restoration since July 2007. As per schedule norms, its capital maintenance is now due. The R&M of unit VI will start after completion of R&M work of unit VII. 5.4.8 Further, BSEB has submitted that Unit VI of BTPS will go for R&M in June, 2012 and Unit VII will come in operation after R&M in July, 2012. Unit VII will be in stabilisation period and hence the operational parameters will be on higher side. The main reason for such high fuel cost is cost of coal and cost of oil which has increased substantially in recent period.
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Table 49: Fuel cost trend submitted by BSEB
Sl. 1 2 3 5.4.9
Financial Year 2008-09 2009-10 2010-11
Coal Price/MT (in Rs.) 1221.27 1701.00 1822.92
Oil Price/Kl (in Rs.) LDO 36915.33 43808.72 51369.98 FO 29260.59 26896.00 30037.70
BSEB has informed the Commission that the Board do not have weighing machine in working condition at their power plant and hence it is not possible to know actual coal transit loss. In such scenario, coal transit loss is projected at 0% for FY 2011-12. Commissions analysis
5.4.10 The Commission in revised estimate approves the cost of BTPS as per trajectory set by the Commission in the Tariff Order of FY 2011-12. 5.4.11 The Commission approves GCV of coal based on average of actual GCV of coal for FY 2009-10 and FY 2010-11. For SHR and cost of coal the Commission approves the values as submitted by the Petitioner keeping in mind the age of the plant and current price trend of coal; however the Commission has considered the actual cost of coal and oil of first nine (9) months of FY 2011-12 for approving the cost of coal and oil for FY 2011-12. 5.4.12 Based on the above parameters, the cost of generation of BTPS as reviewed by the Commission for FY 2011-12 is given below:
Table 50: Approved Plant parameters of BTPS & fuel cost determinants for FY 2011-12 FY 2011-12 FY 2011-12 Approved RE Parameters Units (Approved in (RE) for FY 2011-12 Tariff Order) Gross Units Generated Auxiliary Consumption Net Generation Capacity Derated Capacity Plant Load Factor Auxiliary Consumption Station Heat Rate Sp. Oil Consumption Gross Calorific Value of Coal Calorific Value of Oil Overall Heat MU MUs MUs MW MW % % kcal/kWh ml/kWh kcal/kg kcal/l G Cal 300.00 30.00 270.00 105 105 32.62 10.00 4,316 10.00 4,284 10,000 1294878 202.00 30.30 171.70 220 210 10.45 15.00 4,000 35.00 3,800 9,996 808,009 202.00 20.20 181.80 220.00 210.00 10.98 10 4,000.00 10.00 3,968.50 10,000.00 808,000.00
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FY 2011-12 (Approved in Tariff Order) 30,000 12,64,878 3.80 3000 3,06,948 1.02 2,328 30,000 71.46 9.00 80.46 80.46 2.68
Parameters Heat from Oil Heat from Coal Transit losses Actual Oil Consumption Actual Coal Consumption Specific Coal Consumption Price of Coal Price of Oil Coal Cost Oil Cost Fuel Cost Other Fuel Related costs Total Fuel Costs Total Fuel Cost/Gross Generation
Units G Cal G Cal % kl MT kg/kWh Rs./MT Rs/kl Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs/unit
FY 2011-12 (RE) 70,671 737,337 0 7,070 194,036 0.96 2,600 50,780 50.45 35.90 86.35 7.13 93.48 4.63
Approved RE for FY 2011-12 20,200.00 787,800.00 0 2,020.00 198,513.29 0.98 2,846.97 45,240.28 56.52 9.14 65.65 6.39 72.04 3.57
5.4.13 The generation cost approved by the Commission on the above parameters is subject to true-up, as and when the audited annual accounts and actual generation data is submitted by the Petitioner for FY 2011-12. 5.5 Power Purchase Petitioners submission 5.5.1 BSEB has projected the power purchase costs at Rs.4163 Crs including PGCIL charges for purchase of 11,931 MU for FY 2011-12 in its revised estimate. 5.5.2 The Board in its petition has also intimated that it has started procuring 300 MW short-term power purchase through NVVNL from September 2011 at the rate of Rs. 4.09 per kWh. Considering 85% of availability, energy available during FY 2011-12 is projected at the level of 1304 MU. 5.5.3 The Petitioner submitted that cost of power from each source for the year FY 201112 has been projected based on the actual costs incurred/bills received for the period April2011-August2011. 5.5.4 Based on the above, the projected energy availability of BSEB from the long term sources is summarized in the table below:
Table 51: Power Purchase Cost Projected by the Petitioner for FY 2011-12 (RE)
Station
Allocated Capacity (MW)
Units available (MU)
Per unit cost ( Rs/ kWh)
Total Cost (Rs Cr.) Page 116
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Station NTPC Farakka Talchar Kahalgaon KBUNL NHPC Rangit Teesta PTC Chukka Tala Others NEA BSHPC NSSM Short/Medium Term RE Purchase Solar Other renewable PGCIL Charges Total
Allocated Capacity (MW) 466 398 439 110
Units available (MU) 2,889 2,449 2,670 321
Per unit cost ( Rs/ kWh) 4.36 2.84 3.63 3.65
Total Cost (Rs Cr.) 1,260 696 969 117
21 109
119 549
1.54 1.28
18 70
80 260
543 909
1.53 1.78
83 162
50 18 300
4 30 29 1,304 1 114
4.41 2.49 3.35 4.09 15.00 3.90
2 8 10 533 1 44 190 4,163
2250
11,931
3.49
Commissions analysis 5.5.5 Plant-wise expected power purchase quantum and its total cost for FY 2011-12 (RE) as approved by the Commission are as given below:
Table 52: Approved revised estimates of Power Purchase Cost for FY 2011-12 (RE)
Station
Approved Units (MU) in FY 201112 Tariff Order 2889 2590 2851 500
Approved Per unit cost ( Rs/ kWh) in FY 201112 Tariff Order 3.42 2.41 2.94 3.65
Approved Total Cost (Rs Cr.) FY 2011-12 Tariff Order 988 624 837 183
Approved Units (MU) FY 2011-12 (RE)
Now Approved Total Cost (Rs Cr.) FY 2011-12 (RE) 1,258 694 968 117
NTPC Farakka Talchar Kahalgaon KBUNL NHPC Rangit Teesta
2,889 2,449 2,670 321
4.36 2.84 3.63 3.65
145 550
1.89 1.71
27 94
119 549
1.54 1.28
18 70
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TARIFF ORDER FOR FY 2012-13 Now Approved Total Cost (Rs Cr.) FY 2011-12 (RE)
Station
Approved Units (MU) in FY 201112 Tariff Order
Approved Units (MU) FY 2011-12 (RE)
PTC Chukka Tala Others NEA BSHPC NSSM Short/Medium Term RE Purchase Solar Other renewable PGCIL Charges Total
560 1020
1.59 1.84
89 188
543 909
1.53 1.78
83 161
67 41 12 1 131
4.33 2.49 4.12 15.00 3.90
29 10 5 1 51
4 30 29 1,304 1 114
4.41 2.49 3.35 4.09 15.00 3.90
2 8 10 533 1 44 190 4,157
11,356
3395
11,931
5.5.6
The revised power purchase cost for FY 2011-12 approved by the Commission from the different sources is subject to true-up, as and when the actual power purchase cost with audited annual accounts will be submitted by the Petitioner for FY 2011-12.
5.6
5.6.1
Energy balance depicts the balance between total energy sales and T&D losses (i.e.) energy requirement and energy available from own generation and power purchased from various generating sources.
5.6.2
BSEB has projected inter-state transmission losses of 3.31% with a justification that it is the actual central sector eastern region transmission losses. Further, BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 explained that the Energy balance has been worked out based on the same methodology as adopted by the Commission in its Tariff Order for FY 2011-12. For power availability, own generation and net power purchase is taken into consideration. For power requirement, sale to consumer, additional power sale to consumer, sale to Nepal and sale through Bilateral/UI has been considered. T&D losses are applied on sale to consumers in Bihar and Sale to Nepal only and not applied on the sale under bilateral/UI while projecting for FY 2011-12.
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5.6.3
The projected gross energy requirement, energy availability and additional power purchase required because of actual and approved losses for BSEB for FY 2011-12 (RE) is as follows:
Table 53: Proposed Energy Requirement & Energy Balance
Particulars Energy Sales within State (MU) Sale from additional Power Availability (MU) Energy outside State (Nepal) (MU) Sale in biteleral trade/UI (MU) Total Sales (MU) T&D Losses (MU) T&D Losses (%) Energy Requirement Energy Availability (MU) Own Generation (MU) Total Power Purchase from long term sources (MU) Transmission loss in regional losses (%) Less: Transmission loss in regional losses (MU) Net Power Availability (MU) Disallowable Power Purchase (MU)
FY 2011-12 (Approved by BERC FY 2011-12) 6828 977 550 8355 3013 29% 11,368
FY 2011-12 (As per BSEB loss projection) 5929 171 555 293 6948 4819 42% 11,768
FY 2011-12 (As per BERC loss approved) 5929 171 555 293 6948 2718 29% 9,667
270 11,356 2.43% 258 11,368
172 11,931 3.31% 335 11,768
172 11,931 3.31% 335 11,768 2101
5.6.4
BSEB has further submitted that for FY 2011-12, BSEB projects to under-achieve the T&D loss as compared to the T&D loss trajectory approved by the Commission hence BSEB is required to purchase additional power of 2101 MUs for FY 2011-12 as indicated in Energy Balance. Based on the net power purchase rate, additional power purchase cost works out to Rs. 754.26 Cr. for FY 2011-12. Board has requested the Commission to reduce resource gap funding to the extent of such disallowances and only remaining amount need to be considered as subsidy available for consumers. Commissions analysis
5.6.5
The Commission approves the limits for energy requirement and energy availability as given below for the FY 2011-12. Commission while approving the energy balance considered the inter-state transmission losses of 2.43% as approved in the Tariff Order of FY 2011-12. Further, the disallowed power purchase cost is estimated on the basis of the approved level of T&D losses.
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Table 54: Approved Energy Requirement for FY 2011-12 (RE)
Particulars Energy Sales within State (MU) Sale from additional Power Availability (MU) Energy outside State (Nepal) (MU) Sale in biteleral trade/UI (MU) Total Sales (MU) T&D Losses (MU) T&D Losses (%) Energy Requirement Energy Availability (MU) Own Generation (MU) Total Power Purchase from long term sources (MU) Transmission loss in regional losses (%) Transmission loss in regional losses (MU) Net Power Availability (MU) Disallowable Power Purchase (MU)
FY 2011-12 (Approved by BERC FY 2011-12) 6828 977 550 8355 3013 29% 11,368
FY 2011-12 (As per BERC loss approved) 5929 171 555 293 6948 2718 29% 9,667
270 11,356 2.43% 258 11,368
172 11,931 3.31% 335 11,768 2101
FY 2011-12 (RE) Approved by BERC 5,929 171 555 293 6,948 2,718 29.00% 9,667 182 9,721 2.43% 236.22 9,667 2,210
5.7
Operation & Maintenance Expenses (O&M) Employee Expenses Petitioners submission
5.7.1
The employee cost comprises salaries and wages, dearness and other allowances, pension, gratuity and staff welfare expenses etc.
5.7.2
BSEB submitted that they are calculating the terminal liabilities on provisional basis and hence the amount of terminal benefits/retiral dues payable to the retired employees is not treated as expenditure for the year. The amount actually paid is adjusted against the provision made in the books of account for pension, gratuity and leave encashment. BSEB has also submitted that, in view of the severe financial crunch mainly on account of average tariff lower than average cost of supply, BSEB has not been able to maintain separate fund for retiral liabilities as per the provisions made in the Annual Accounts hence, there has been a practice by BSEB to meet such unfunded liability out of the revenue realized from sale of energy during the period of incidence of discharge of such liabilities.
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5.7.3
BSEB has accordingly submitted that the total expenditure under the head of employee costs is 593.90 Cr. as per the annual accounts for FY 2010-11 and Rs. 168.99 Cr. paid to its retired employees as unfunded terminal liabilities in FY 201011.
5.7.4
For projection of employee cost for FY 2011-12, BSEB has considered that the employee expenses will increase by 10% in FY 2011-12 from level of FY 2010-11. BSEB has also projected additional cost of Rs. 11.07 Cr. for new employees for FY 2011-12. The employee cost for FY 2011-12 has been projected to be Rs. 829.8 Cr.. The details of employee cost for FY 2010-11 (actual), FY 2011-12 (RE) is as given below.
Table 55: Employees Cost Proposed for FY 2011-12 (RE) (Rs Cr)
Sl.
Particulars SALARIES & ALLOWANCES
FY 2011-12 (RE)
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27
Basic Pay + Special Pay Dearness Pay Dearness Allowance House rent Allowance Fixed medical allowance Medical reimbursement charges Over time payment Other allowances Generation incentive Bonus Total Leave encashment Gratuity Commutation of Pension Workman compensation Ex- gratia Total Pension Payment Basic Pension Dearness Pension Any other expenses Total Total (11+17+21) Payment made for unfunded liabilities Increase in employee cost Due to New Recruitments Grand Total (22+23+24) Less: Employee cost capitalized Net Employee Cost
265.24 107.74 21.83 2.36 0.90 4.93 5.39 408.39 17.14 18.16 0.36 35.66 203.32 2.17 205.50 649.54 189.63 11.07 850.24 20.44 829.80
Commissions analysis
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5.7.5
The Commission in the Tariff Order for FY 2011-12 had stated that:
4.7.12. So far the contribution of the employees towards GPF and GSS is concerned; this is not a part of employee cost. This amount is deducted from the salary of the employees and should be deposited in a separate fund to be governed by a Trust in which both BSEB and its employees are represented. Any investment out of this fund has to be with the approval of the Trust. 4.7.13. The Commission directs BSEB to report the steps taken towards creation of the trust. The Commission shall be compelled to take appropriate action, if this direction is not complied with immediately.
5.7.6 The Commission has already directed BSEB to create separate trust for making payments for terminal liabilities in its Tariff Order for FY 200607 as reproduced below:
The BSEB shall take steps to invest contribution of employees towards pension etc., through a Trust and make arrangements to pay the pension, gratuity etc., from the earnings of the investments through the Trust.
5.7.7 It is apparent that BSEB has utilised the amounts available in the fund created towards GPF and GSS contribution towards meeting its day to day expenses i.e. for the purpose of funding its working capital requirements. Accordingly, permitting these expenses to be passed on to the consumers shall mean that the consumers have to bear the burden for the past financial mismanagement by the Board. The Commission is of the view that such liabilities on account of past issues should be funded by BSEB through its own means and should not be passed on to the consumers at this point of time. The regulations anyways provide for normative working capital interest to be passed on to the consumers thus meeting the working capital requirements of the licensee for the year. However, the Commission has always been allowing the present provision for existing employees on accrual basis.
Table 56: Approved revised estimates of employee Cost for FY 2011-12 (RE) (Rs. Cr.)
Employee cost Generation Transmission Distribution Total Employee Cost
FY 2011-12 (Approved by BERC) 46.00 88.00 664.00 798.00
FY 2011-12 (Revised estimate by BSEB) 44.21 98.66 686.93 829.80
FY 2011-12 (RE) Now approved by Commission 34.13 76.29 530.93 641.36
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5.7.8
The Commission has projected the employee cost of FY 2011-12 separately for each of the generation, transmission and distribution function considering the figures of audited annual accounts of FY 2010-11 as base value. The Commission has allowed the additional cost of Rs. 11.07 Cr. for new employees during FY 2011-12 and distributed the same in the ratio of employee cost of each function based on the audited accounts of FY 2010-11. The Commission in current economic situation considers escalation rate of 9.56% appropriate for determining employee cost for FY2011-12 for each function. Based on the same, the Commission approves employee cost for FY 2011-12 as depicted in the table given below:
Table 57: Function-wise employee Cost approved for FY 2011-12 (RE) (Rs Cr.)
Particulars Employee Cost New Employee cost Less : Capitalization Net Employee Cost % Share ot Total cost
Generation 34.68 0.59 1.13 34.13 5.32%
Transmission 77.40 1.32 2.42 76.29 11.90%
Distribution 538.62 9.16 16.85 530.93 82.78%
Total 650.69 11.07 20.40 641.36 100.00%
5.7.9
The revised employee cost for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the audited annual accounts and actual employee cost will be submitted by the Petitioner for FY 2011-12. Repair & Maintenance Expenses (R&M) Petitioners submission
5.7.10 BSEB has projected R&M expenses of Rs. 100.62 Cr. for FY 2011-12. BSEB has projected that the R&M expenses will increase by 10% in FY 2011-12 from level of FY 2010-11.
Table 58: R&M costs submitted by Petitioner for FY 2011-12 (RE) (Rs Cr)
Particulars Plant & Machinery Building Hydraulic works Civil Work Line cable & network Vehicles Furniture & fixtures Office equipments Operating expenses Total expenses
FY 2010-11 (Actual) 34.56 2.20 2.93 0.18 17.10 0.09 0.20 0.14 57.40
FY 2011-12 (Approved) 43.16 7.27 0.33 2.88 35.03 0.20 0.04 0.15 5.94 95.00
FY 2011-12 (RE) 43.16 7.27 0.33 2.88 35.03 0.20 0.04 0.15 5.94 95.00
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Particulars Add cost of materials procured from Board's Hdqrs Net Expenses Cost of water & Other Misc. Charges Total R&M Expenses charged
FY 2010-11 (Actual) 57.40 5.11 62.51
FY 2011-12 (Approved) 95.00 95.00
FY 2011-12 (RE) 95.00 5.62 100.62
Commissions analysis 5.7.11 The Commission had already approved significant increase for FY 2011-12 during the past Tariff Order with the expectation that higher R&M cost will help BSEB in improving operational efficiency.
Table 59: Approved revised estimates of R&M Cost for FY 2011-12 (RE) (Rs. Cr.)
R&M cost Generation Transmission Distribution Total R & M Cost
FY 2011-12 (RE) Now approved by Commission 15.73 12.82 72.07 100.62
5.7.12 The Commission has computed the R&M cost separately for Generation, Transmission and Distribution functions for FY 2011-12 considering the actual function-wise break-up data as per the annual accounts of the Board for FY 2010-11 as base value. The Commission in current economic situation considers escalation rate of 9.56% appropriate for determining R&M cost for FY2011-12. Based on the same, the Commission approves R&M cost for FY 2011-12 as depicted in the table given below:
Table 60: Function-wise approved R&M costs for FY 2011-12 (RE) (Rs Cr)
Particulars R&M Cost Add : Water & Misc charges Total % Share
Generation 10.11 5.62 15.73 15.63%
Transmission 12.82 12.82 12.74%
Distribution 72.07 72.07 71.63%
Total 95.00 5.62 100.62 100.00%
5.7.13 The revised R&M cost for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the actual R&M cost will be submitted by the Petitioner for FY 2011-12. Administration & General Expenses (A&G) Petitioners submission
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5.7.14 BSEB has projected A&G cost on the 3 years CAGR based on the audited data of A&G expenses for the period FY 2007-08 to FY 2010-11 which is 12% and thus the A&G expenses post capitalization are projected at Rs. 53.49 Cr. for FY 2011-12.
Table 61: A&G costs submitted by Petitioner for FY 2011-12 (Rs Cr)
Particulars Rent, rates & taxes Insurance Telephone, postage &Telegrams Legal Charges Audit Fees Consultancy fees Technical fees Other professional charges Conveyance & travel expenses Others Freight Total expenses Less Capitalised Net expenses Add Prior period Total A&G Expenses Metering, Billing and collection Total A&G Expenses
FY 2010-11 (Actual) 0.50 0.99 0.98 3.25 0.01 4.99 29.39 0.17 40.29 1.46 38.83 38.83 38.83
FY 2011-12 (RE) 0.56 1.11 1.10 3.64 0.01 5.59 32.92 0.19 45.13 1.64 43.49 43.49 10.00 53.49
Commissions analysis 5.7.15 The Commission in current economic situation considers escalation rate of 9.56% appropriate for determining R&M cost for FY 2011-12. Based on the same, the Commission has approves the revised R&M cost for FY 2011-12 as depicted in the table given below:
Table 62: Function-wise approved revised estimates of A&G costs for FY 2011-12 (RE) (Rs. Cr)
Particulars A&G Cost Less : Capitalization Add : Metering related cost Total % Share
Generation 1.29 0.05 1.25 1.76%
Transmission 4.79 0.17 4.62 6.53%
Distribution 38.06 1.38 28.17 64.85 91.71%
Total 44.15 1.60 28.17 70.72 100.00%
Table 63: Approved revised estimates of A&G Cost for FY 2011-12 (Rs. Cr.)
A&G cost Generation
FY 2011-12 (Approved by BERC) 1.26
FY 2011-12 (Revised estimate by BSEB) 1.27
Now approved for FY 2011-12 (RE) 1.25 Page 125
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TARIFF ORDER FOR FY 2012-13 FY 2011-12 (Revised estimate by BSEB) 4.72 47.50 53.49 Now approved for FY 2011-12 (RE) 4.62 64.85 70.72
A&G cost Transmission Distribution Total A &G Cost
5.7.16 The revised A&G cost for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the actual A&G cost will be submitted by the Petitioner for FY 2011-12. Operation & Maintenance Expenses (O&M)
Table 64: Approved revised estimates of O&M Cost for FY 2011-12 (Rs. Cr.)
Sl. 1 2 3 4
Particulars Employee cost Repair and Maintenance (R&M) Expenses Administrative & General (A&G) Expenses Total O&M Cost
Now approved for FY 2011-12 (RE) 641.36 100.62 70.72 812.70
5.7.17 The revised O&M cost for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the actual O&M cost will be submitted by the Petitioner for FY 2011-12. 5.8 Capital Expenditure Petitioners Submission 5.8.1 BSEB has taken up R&M works of Unit VI and VII under the RSVY scheme sanctioned by the Planning Commission, Government of India. Capacity extension of Muzaffarpur Thermal Power Plant (2x195 MW) & Barauni TPS (2X250 MW) has been sanctioned by the State government. BSEB has also undertaken various transmission network capacity addition, augmentation and improvement projects for achieving its objective of making available reliable power across the State. BSEB is already implementing many schemes for strengthening, augmenting and expanding its distribution network. For FY 2011-12 BSEB would support ongoing schemes of Distribution strengthening program. The ongoing schemes include transformer replacement, procurement of new transformers, and replacement of old conductor of HT & LT line, construction of new HT & LT lines, PSS & bays.
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5.8.2
BSEB has furnished function wise / scheme wise (without description of assets) details of the proposed capital expenditure for FY 2010-11 & FY 2011-12 as given in the table below:
Table 65: Planned Capital Expenditure proposed by BSEB for FY 2011-12
Sl. 1 a) b) 2 a) b) c) 3 a) b) c) d) e) f) g) h) i) j) k) l) m) n)
Particulars Generation Ongoing schemes BRGF Sub Total Transmission BRGF Mahatma Gandhi Setu Cable crossing Ongoing Scheme Sub Total Distribution Ongoing Scheme APDRP R-APDRP BRGF ADB PMGY MNP Tal Diara Border Area ACA RGGVY Deposit Work Others works Others Capital works Sub Total Total
FY 2010-11 (Actual) 340.66 14.40 355.06 14.67 0.57 15.24 70.89 68.88 0.05 1.18 0.38 0.04 21.94 237.11 24.57 172.14 43.13 640.31 1,010.61
FY 2011-12 (RE)
1,181.21 153.00 1,334.21 450.13 13.96 131.26 595.35 595.42 68.66 96.82 20.00 0.80 0.50 1.00 0.05 76.75 315.28 12.93 52.93 92.50 1,333.63 3,263.19
5.8.3
The capitalization rate of capital expenditure and opening balance of CWIP was 30% in FY 2009-10 and 43% in FY 2010-11. BSEB has considered capitalization rate of 43% for FY 2011-12. Commissions View
5.8.4
As per the licence conditions para 51 of chapter 5 of BERC (Grant of licence for Distribution of electricity) Regulations, 2007, BSEB is required to furnish details of the proposed schemes expenditure before commencement of the project with description of assets and its usability in furthering the efficiency or growth in the business of the Board. Further, BSEB should seek prior approval of such capital expenditure from
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the Commission. In the absence of the approval, the Commission may disallow corresponding depreciation and interest cost. 5.8.5 The Commission vide letter no. BERC- Tariff 24/11- 825 dated 21st December, 2011 sought clarification on sources of funding like loans, capital grant, consumer contribution or own funding. In reply BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 provided details of sources of funding. The funding details of various schemes as provided by BSEB are as given in the table below:
Table 66: Funding details proposed by BSEB for FY 2011-12 (RE)
FY 2011-12 (RE) Sl. 1 a) b) 2 a) b) c) 3 a) b) c) d) e) f) g) h) i) j) k) l) m) n) Particulars Generation Ongoing schemes BRGF Sub Total Transmission BRGF Mahatma Gandhi Setu Cable crossing Ongoing Scheme Sub Total Distribution Ongoing Scheme APDRP R-APDRP BRGF ADB PMGY MNP Tal Diara Border Area ACA RGGVY Deposit Work Others works Others Capital works Sub Total Total Capital Expenditure 1,181.21 153.00 1,334.21 450.13 13.96 131.26 595.35 595.42 68.66 96.82 20.00 0.80 0.50 1.00 0.05 76.75 315.28 12.93 52.93 92.50 1,333.63 3,263.19 Grant Consumer Contribution 12.93 52.93 65.86 65.86 Borrowings
153.00 153.00 450.13 450.13 603.13
1,181.21 1,181.21 13.96 131.26 145.22 595.42 68.66 96.82 20.00 0.80 0.50 1.00 0.05 76.75 315.28 92.50 1,267.77 2,594.20
5.8.6
As in the power projects such as Muzaffarpur Thermal Power Plant (2x195 MW) & Nabhinagar Super Thermal Power Plant (3 x 660 MW); BSEB is the equity partner with NTPC for which separate tariff will be determined by the appropriate Commission, So the Commission has not considered the capital expenditure under
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thses plants for computation of GFA, interest and finance charges and depreciation. With respect to capacity extension of Barauni TPS (2X250 MW) which is expected to be commissioned in June 2014, i.e. FY 2014-15, GFA, interest and finance charges and depreciation has not been considered in FY 2011-12. In light of the above, the Commission has only considered the capital expenditure of Rs. 153 Cr. for FY 201112 as grant under RSVY scheme for R&M of BTPS, for the purpose of computation of GFA. 5.8.7 Based on the details provided by BSEB, the Commission considers the following funding pattern for proposed capital expenditure for computation of allowable interest based on the percentage described in paragraph 5.8.9 and 5.8.10.
Table 67: Funding pattern considered by Commission during FY 2011-12 (Rs. Cr.) (RE)
Sl. 1 2 3 4
Particular Capital Expenditure Grant Consumer contribution Borrowings
Generation 1,334.21 153.00 1,181.21
Transmission 595.35 450.13 145.22
Distribution 1,333.63 65.86 1,267.77
Total 3,263.19 603.13 65.86 2,594.20
5.8.8
BSEB has proposed significantly high capital expenditure for FY 2011-12, compared with the capital expenditure incurred by BSEB in past years is considered. However the Commission for this order has considered the capital expenditure proposed by BSEB as it has been able to demonstrate that equivalent amount funding is available for carrying out the proposed capital expenditure.
5.8.9
The capitalization of the above proposed capital expenditure is considered in accordance with the capitalization schedule given in the table below:
Table 68: Capitalization schedule for proposed capital expenditure
Sl. 1 2 3
Particulars Generation Transmission Distribution
1st year 50% 25% 25%
2nd year 50% 30% 25%
3rd year 0% 30% 25%
4th year 0% 15% 25%
5.8.10 Further for computation of additions to GFA from capitalization of CWIP, the closing balance of FY 2010-11 and the capitalization rate as given in the table below has been considered which is in line with the methodology adopted by the Commission in the Tariff Oreder for FY 2011-12.
Table 69: Capitalization schedule for CWIP
Sl. 1
Particulars Generation
FY 2011-12 30%
FY 2012-13 30%
FY 2013-14 40%
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Sl. 2 3
Particulars Transmission Distribution
FY 2011-12 30% 30%
FY 2012-13 30% 30%
FY 2013-14 40% 40%
5.8.11 To ascertain function wise asset addition due to capitalization of CWIP, the closing balance of CWIP reflected in the annual accounts of FY 2010-11 was segregated into the three functions based on the contribution of these functions to the total GFA at the end of FY 2010-11. 5.8.12 The addition to the assets from loans, grants and CWIP was computed for FY201112.
Table 70: Approved GFA by Commission FY 2011-12 (RE)
Sl. 1 2 3
Particulars Opening GFA (FY 2011-12) Addition during the year Closing GFA (FY 2011-12)
Generation 334.28 109.84 444.12
Transmission 739.92 222.64 962.56
Distribution 2,781.87 610.88 3,392.75
Total 3,856.07 943.36 4,799.43
5.8.13 The GFA levels as approved by the Commission for FY2011-12 are given in the table below:
Table 71: Approved GFA (Rs. Cr.) by Commission FY 2011-12 (RE)
Sl. 1 2 3 4
Particulars Generation Transmission Distribution Total
Closing GFA for FY 2011-12 as per Tariff Order of FY 2011-12 563.73 1,161.63 2,687.73 4,413.09
Closing GFA for FY 2011-12 (RE) Now approved 444.12 962.56 3,392.75 4,799.43
5.9
Depreciation Petitioners Submission
5.9.1
BSEB has computed depreciation for FY 2011-12 by calculating depreciation on existing assets at weighted average rates of FY 2010- 11. BSEB has not considered depreciation on assets which are not in use. BSEB has also not considered depreciation on assets which have depreciated upto 90% of its acquisition cost.
Table 72: Revised estimate of Depreciation charges proposed by BSEB FY 2011-12 (RE)
Sl. 1 2 3 4
FY 2010-11 (Actual) 2.43 14.57 72.01 89.00
FY 2011-12 (Approved) 11.13 29.96 76.20 117.29
FY 2011-12 (RE) 21.84 22.78 109.59 154.21
Commissions View
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5.9.2
The Commission has considered closing balance of GFA as achieved in FY 2010-11 as per the annual accounts of that year. The Commission has thereafter considered asset additions of Rs. 943.36 Crores for FY 2011-12. This addition is as per the explanation provided in the earlier paragraph at 5.8.12.
5.9.3
It is noted here that the Clause 17 of Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 specifies that depreciation shall be calculated annually based on Straight Line Method at rates specified in Appendix III of the said regulations. Provided that, the remaining depreciable value as on 31st March of the year closing after a period of 12 years from date of commercial operation shall be spread over the balance useful life of the assets.
5.9.4
For existing assets age-wise and asset wise description has not been provided by BSEB, the Commission has used the weighted average rate of deprecation achieved in FY 2010-11 for them. For new assets created during FY 2011-12, rates prescribed by CERC have been applied by the Commission to determine deprecation allowable for FY 2011-12. Function wise computation of depreciation has been carried out by the Commission based on projected fixed asset for each function during the FY 2011-12.
5.9.5
Based on approved GFA and additional capitalization computed during FY 2010-11, the Commission calculated the depreciation for FY 2011-12. However, the depreciation on the assets created out of consumer contribution, grant has been deducted from the gross depreciation to arrive at the net depreciation charge for BSEB. The computation of the depreciation on the assets created out of consumer contribution, grant is based on the average of ratio of Grant and contribution and GFA for past three (3) years.
Table 73: Function wise revised Depreciation approved for FY 2011-12 (RE) (Rs Cr)
Sl. 1 2
Particulars Gross Depreciation Net Depreciation
Transmission 22.23 17.12
Distribution 125.28 86.68
Total 153.47 108.42
5.9.6
The revised depreciation for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the actual depreciation will be submitted by the Petitioner for FY 2011-12.
Table 74: Approved revised estimate of Depreciation (Rs. Cr.) charges for FY 2011-12 (RE)
Sl.
Particulars
FY 2011-12 (Approved in Tariff Order of FY
FY 2011-12 (RE) (Projected by BSEB
Now approved for FY 2011-12 (RE) Page 131
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TARIFF ORDER FOR FY 2012-13 in revised estimate ) 21.84 22.78 109.59 154.21
1 2 3 4
Generation Transmission Distribution Total
4.62 17.12 86.68 108.42
5.10
Interest & Finance Charges Petitioners Submission
5.10.1 For calculation of Interest and Finance charges for FY 2011-12, BSEB has considered the closing balance of loans of FY 2010-11 used for funding capital expenditure and the new loans proposed to be drawn during the year as per the indicated capitalization schedule of the proposed capital expenditure. 5.10.2 Based on the capitalization and its funding pattern, additional loan requirement has been worked out for FY 2011-12. BSEB has assumed that all additional funding requirements will be met by the State Government at the rate of 13% per annum. 5.10.3 Total repayment of loans has been considered equal to the depreciation proposed for the year. Repayment of Loans other than state plan loans is proposed at 10% of the opening loan amount. The repayment of state plan loans have been considered equivalent to depreciation amount left after repayment of non-state loans. 5.10.4 For existing loans, prevailing interest rate has been considered while for new loans interest rate of 13% is proposed. Based on the same, BSEB revises its estimate of Interest and Finance Charges for FY 2011-12 to Rs. 464.31 Cr. as against Rs.149.01 Cr. approved by the Commission. Function-wise Interest & financial charges calculated are as shown in table below:
Table 75: Proposed Interest & Financial Charges for FY 2011-12 (RE)
Sl. 1 2 3 4
FY 2010-11 (Actual) 50.80 49.57 230.12 330.49
FY 2011-12 (Approved) 25.00 42.00 82.01 149.01
FY 2011-12 (RE) 100.89 60.33 303.10 464.31
Commissions View 5.10.5 The Commission vide letter no. BERC-Tariff-24/11-88 dated 27th January, 2012 sought details of the loans and the corresponding assets created out of these loans. Since interest is payable only on loans used for creating usable assets, which have
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been put to use during the year. BSEB could not provide the desired information. The Commission has excluded loans raised for working capital or to meet revenue deficit included for interest claimed by BSEB. 5.10.6 In absence of desired information and identification of loans used for creation of assets, the Commission decided to adopt an indirect methodology to compute outstanding balance of loans as on 1st April, 2011 used for asset creation. In the absence of the adequate data with BSEB the Commission has considered the repayment during the year as per the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 reproduced as below: The repayment for the year of the tariff period 2009-14 shall be deemed to be equal to the depreciation allowed for that year Closing balance of GFA as on 31st March 2011 (as per annual accounts) provides the value of assets created out of all possible sources of funding. If from this balance all the assets created from consumer contribution and grants are excluded then the balance assets have been funded from the loans raised till date. 5.10.7 Further if the accumulated depreciation as on date is excluded then balance will be the assets funded out of existing loans. The accumulated depreciation can be considered as proxy for the loans repaid till date. The Commission has used this concept to compute opening level of loan as on 1st April, 2011 used for the creation of fixed assets. The Commission considers this approach reasonable in the absence of supporting evidence of utilization of loans for asset creation and its usability in business. However, Commission may revisit this computation on getting the actual details from BSEB at the time of true-up based on audited accounts of FY 2011-12. 5.10.8 The additional loan to the extent of asset capitalized during the year can only be considered for interest cost computation. Interest cost on remaining loan amount should be capitalized and considered as part of capital cost of the asset. This is in accordance with the BERC (Terms and condition for determination of Tariff) Regulation, 2007, which provides for interest only on assets which are capitalized and not on the entire capital expenditure incurred during the year. 5.10.9 Assets capitalized during the year can be funded through grant, consumer contribution and borrowing. Interest is payable on loans equivalent to capitalized assets funded through borrowings only. To determine this additional loan the
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proposed capitalization is segregated in the ratio of existing levels of grant, consumer contribution and borrowings. 5.10.10 The approved depreciation during the year is used as the repayment amount during the year. 5.10.11 Interest rate of 13% as proposed by BSEB has been verified from the sanction letters issued by the State Government and the proposed rate was found in line with the interest rate charged by the State Government. The Commission has computed the interest and finance charges for each function on the basis of the loan availed by the Board for the respective function. 5.10.12 The repayement of the loan during the tyear has been computed at 10% of the outstanding loan at the beginning of the year as per the methodology adopted in Tariff order for FY 2011-12. 5.10.13 The Commission has considered the closing balance of loan for FY 2010-11 (as per true-up Order) as the opening loan for FY 2011-12 and has computed the interest on loan for FY 2011-12 (RE). the Commission has computed the interest on loan as per the methodology adopted in Tariff order for FY 2011-12, Based on the above, interest on loan for FY 2011-12 (RE) as approved by Commission based on capitalization considered during the year is given in the table below:
Table 76: Approved revised estimate of Interest & Finance Charges for FY 2011-12 (RE) (Rs Cr)
Sl. 1 2 3 4 5 6
Particulars Opening Loan Addition of Loan Repayment of Loan Closing Loan Interest rate Interest on Loan
FY 2011-12 (Approved in Tariff Order of FY 2011-12) 775.00 742.40 77.50 1439.90 13% 149.01
Now approved for FY 2011-12 (RE) 471.49 558.99 47.15 983.33 13.00% 94.56
5.10.14 Based on the interest finance charges of FY 2010-11 as per audited annual accounts of BSEB, the interest cost for Generation, Transmission and Distribution business of BSEB has been worked out for FY 2011-12. 5.10.15 The interest and finance charges for FY 2011-12 as approved in Tariff Order for FY 2011-12, revised estimate for FY 2011-12 and now approved by Commission for FY 2011-12 (RE) is shown in table below.
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Table 77: Approved revised estimate for Interest & Financial Charges for FY 2011-12 (RE)
Sl. 1 2 3 4
FY 2011-12 (Approved in Tariff Order of FY 2011-12) 25.00 42.00 82.01 149.01
FY 2011-12 (RE) (Projected by BSEB in revised estimate ) 100.89 60.33 303.10 464.31
Now approved for FY 2011-12 (RE) 20.35 14.18 60.03 94.56
5.10.16 The revised interest and finance charges for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the actual interest and finance charges will be submitted by the Petitioner for FY 2011-12. 5.11 Interest on Working Capital Petitioners Submission 5.11.1 BSEB has proposed interest on working capital in accordance with the applicable regulations notified by the Commission. The considerations for computing working capital requirement and interest thereon are summarized in the table below for each of the functions of BSEB.
Table 78: Methodology adopted by BSEB for calculation of Working Capital
Description Norms for calculation
Generation Thermal WC = 2 months cost of coal + 2 months cost of secondary fuel oil + Maintenance spares (at 1% of GFA escalated at 6 % per annum) + 1 month O&M + Receivables (2 months of fixed and variable charges).
Transmission
Distribution
Reference
WC = Maintenance WC=1 month spares ((at 1% of O&M + GFA escalated at 6 Maintenance % per annum) + spares (at 1% Receivables (2 of GFA months of escalated at 6 transmission % per annum) + charges) + 1 month 2 months O&M revenue BERC (Terms and conditions for determination of Tariff) Regulations, 2007.
5.11.2 BSEB has proposed short-term prime lending rate of SBI as on 01/04/2011 i.e. 13.00% for computing interest on working capital. The BSEB has proposed interest on working capital at Rs. 163.31 Cr. for FY 2011-12.
Table 79: Proposed revised estimates of Interest on Working Capital for FY 2011-12 (RE) (Rs Cr)
Particulars 2 month primary fuel & secondary fuel 1 month O&M Receivables Maintenance Spares
Generation 93 5 53 3
Transmission 10 45 7
Distribution 67 944 28
Total 93 82 1,042 38
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Particulars Total WC Requirement Interest Rate (SBI PLR as on Apr11) Interest on Working Capital
Generation 155 13.00% 20.13
Transmission 62 13.00% 8.12
Distribution 1,039 13.00% 135.06
Total 1,256 13.00% 163.31
Commissions View 5.11.3 The Commission is of the view that, since the working of BSEB is still as an integrated unit, the Commission has not considered receivables for Generation and transmission function. 5.11.4 Interest on working capital is computed on normative basis as per BERC (Terms and conditions for determination of Tariff) Regulations, 2007. SBI PLR rate of 13% as on 1st April, 2011 has been considered for calculation of interest for funding working requirement. Based on the same, Commission approves revised estimate of interest on working capital for FY 2011-12 (RE) as given in the table below:
Table 80: Approved function wise Revised estimate of Interest on Working Capital for FY 2011-12 (RE) (Rs Cr)
Particulars 2 month primary fuel & secondary fuel 1 month O&M Two (2) months Receivables Maintenance Spares (1% of GFA escalated at 6% per annum) Total WC Requirement Interest Rate (SBI PLR as on Apr11) Interest on Working Capital
Generation 10.9 3.8 8.7 23.5 13% 3.1
Transmission 7.8 9.6 17.4 13% 2.3
Distribution 55.7 691.2 18.6 765.4 13% 99.5
Total 10.9 67.3 691.2 36.9 806.3 13% 104.82
Table 81: Approved revised estimate of interest on working capital for FY 2011-12 (RE) (Rs. Cr.)
Particular 2 month primary fuel & secondary fuel 1 month O&M Receivables Maintenance Spares Total WC Requirement Interest Rate (SBI PLR as on Apr11) Interest on Working Capital
FY 2011-12 (Approved in Tariff Order of FY 2011-12) 13.41 78.75 535.43 33.42 661.01 13% 85.93
FY 2011-12 (RE) (Projected by BSEB in revised estimate ) 93 82 1,042 38 1,256 13.00% 163.31
Now approved for FY 2011-12 (RE) 10.9 67.3 691.2 36.9 806.3 13% 104.82
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5.11.5 The revised estimate of interest on working capital for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the audited accounts of the Board will be submitted by the Petitioner for FY 2011-12. 5.12 Non-Tariff Income Petitioners submission 5.12.1 BSEB has projected non-tariff income of Rs. 48.54 Cr. for FY 2011-12. BSEB has mainly considered 3 year CAGR to project non-tariff income for FY 2011-12 based on the actual non-tariff income of FY 2010-11. 5.12.2 BSEB has also requested the Commission not to consider any income from DPS as it is a source for funding increased working capital requirement and also requested the Commission not to consider income from interest on un-utilized funds while determining ARR for FY 2011-12. 5.12.3 The detailed break-up of non-tariff income claimed by the Petitioner is as below:
Table 82: Break-up of proposed non-tariff income for FY 2011-12 (RE) (Rs. Cr.)
Sl. 1 2 3 4 5 6 7 8 9 10 11 12 13 15 17 18 19
Particulars Meter/Service rent Late payment surcharge Theft / pilferage of energy Misc. receipts Misc. charges (except PLEC) Wheeling charges Interest on staff loans & advance Income from trading Income from welfare activities Rental Tender Registration Interest of Bank Deposit Rebate & discount received Incentive for timely payment against loan to PFC Incentive for timely payment against loan to PFC Total Income Add Prior period income Total Non-tariff income
FY 2011-12 (Approved) 25.00 38.24 10.00 2.79 10.55 0.01 1.02 53.48 26.06 1.08 168.23 168.23
FY 2011-12 (RE) 22.38 4.07 16.32 0.05 1.05 3.06 0.44 1.16 48.54 48.54
Commissions analysis 5.12.4 The Commission agrees with the methodology adopted by BSEB to compute nontariff income. At the same time, the Commission feels that it is necessary to adjust
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some components of non-tariff income based on recent developments in the sector which do appropriately reflect the past trend. Also, the Commission has allocated entire non-tariff income to the distribution function on BSEB. 5.12.5 The Commission has approved the meter rent, Interest on Staff Loan & Advance, and Misc. charges from consumers for FY 2011-12 based on the three (3) years CAGR based on actual value for FY 2010-11. The Commission has considered the Interest of bank Deposit as per approved value of Tariff Order for FY 2011-12. For other components of Non-tariff income, the Commission has considered the actual value of FY 2010-11 as per annual accounts. 5.12.6 The Commission has adopted the approach for DPS as a part of Non-tariff income in line with the recent judgement of Honble Appellate Tribunal for Electricity (APTEL) dt. 12.07.2011 in Case no 142 & 147 of 2009. 5.12.7 The relevant extracts of the Judgment are reproduced below: The normative working capital compensates the distribution company in delay for the 2 months credit period which is given to the consumers. The late payment surcharge is only if the delay is more than the normative credit period. For the period of delay beyond normative period, the distribution company has to be compensated with the cost of such additional financing. It is not the case of the Appellant that the late payment surcharge should not be treated as a non-tariff income. The Appellant is only praying that the financing cost is involved due to late payment and as such the Appellant is entitled to the compensation to incur such additional financing cost. Therefore, the financing cost of outstanding dues, i.e. the entire principal amount, should be allowed and it should not be limited to late payment surcharge amount alone. Further, the interest rate which is fixed as 9% is not the prevalent market Lending Rate due to increase in Prime Lending Rate since 2004-05. Therefore, the State Commission is directed to rectify its computation of the financing cost relating to the late payment surcharge for the FY 2007-08 at the prevalent market lending rate during that period keeping in view the prevailing Prime Lending Rate. 5.12.8 The Commission has computed DPS of Rs. 27.38 Cr.for FY 2011-12 based on the three (3) years CAGR applied on the actual value for FY 2010-11. As the Petitioner charges DPS @ 18% per annum (1.5% per month), the principal amount on which DPS would be charged comes as Rs.152.14 Cr.
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5.12.9 As prevailing SBI PLR as on April 1, 2011 was 13%, the Commission has allowed the financing cost for DPS @ 13%. The financing cost approved by the Commission is shown below:
Particular DPS as per projections (@ 1.5% per month) (A) Principal amount on which DPS was charged (B = A / 18%) Interest Rate for funding of Principal of DPS Interest on funding of Principal amount of DPS
FY 2011-12 27.38 152.14 13.00% 19.78
5.12.10 The Commission has sought additional information vide its letter No. BERC-Tariff24/11-272 dated 23.03.2012 seeking information on actual DPS collected by the Board. However, the Board has replied vide letter no. Com/ tariff-161/11-488 dated 23.03.2012 saying that the same is not available as of now and shall be made available only once the IT based billing system is implemented under the ongoing RAPRDRP Scheme. 5.12.11 The Commission is not satisfied with the justification given by the Board for not maintaining records for actual revenue receipts against DPS. The Commission directs the Board to submit the same as per actuals in its subsequent filings/ true-up petitions, in the absence of which the Commission shall be constrained to consider 100% DPS as non-tariff income for the purpose of calculation of the ARR. 5.12.12 The Commission has computed the amount of Non-Tariff Income as summarised below:
Table 84: Approved revised estimate of Non-Tariff Income FY 2011-12 (RE) (Rs. Cr.)
Particular
FY 2011-12 (Approved in Tariff Order of FY 201112) 25 38.24 10 2.79 10.55 0.01 1.02 -
Meter/Service rent Late payment surcharge (DPS) Theft / pilferage of energy Misc. receipts Misc. charges (except PLEC) Wheeling charges Interest on staff loans & advance Income from trading Income from welfare activities
FY 2011-12 (RE) (Projected by BSEB in revised estimate ) 22.38 4.07 16.32 0.05 1.05 -
Now approved for FY 2011-12 (RE) 21.94 27.38 18.62 0.04 1.05 -
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TARIFF ORDER FOR FY 2012-13 FY 2011-12 (RE) (Projected by BSEB in revised estimate ) 3.06 0.45 1.16 48.54 -
Particular
FY 2011-12 (Approved in Tariff Order of FY 201112) 53.48 26.06 1.08 168.23 -
Now approved for FY 2011-12 (RE)
Rental Tender Registration Interest of Bank Deposit Rebate & discount received Incentive for timely payment against loan to PFC Incentive for timely payment of power purchase bills Total Non-Tariff Income Less: Financing cost of Principal amount of D.P.S. Net Non-Tariff Income
53.48 17.93 0.45 1.16 142.05 19.78 122.28
5.12.13 The revised estimate of Non-tariff income for FY 2011-12 (RE) approved by the Commission is subject to true-up, as and when the audited accounts of the Board will be submitted by the Petitioner for FY 2011-12. 5.13 Return on Equity Petitioners submission 5.13.1 BSEB has submitted that its asset are funded through loans and grants from the Government of Bihar, loans and grants under specialized funding schemes of the Government of India and loans from commercial lending organizations. 5.13.2 BSEB has also submitted that the in states like Jharkhand, Punjab, Chhattisgarh and Kerala, where integrated Boards like BSEB were / are operational, the appropriate Commissions have allowed / allow for a reasonable return on equity despite the fact they have capital structure which is very much similar to that of BSEB and are mainly funded through loans/ grants from respective State Governments. 5.13.3 BSEB has requested for the reasonable return of 14% on normative equity of 30% of the Gross Fixed Assets (net off capital grants/ subsidies) in the ARR for the year 2011-12 of Rs. 231 Cr. Commissions analysis 5.13.4 Return is admissible only on equity actually deployed for the creation of assets. Since, BSEB has not been corporatized; it does not have any equity. The Commission has considered entire assets base funded through loan and accordingly interest has been allowed. Therefore, no return is payable on notional equity.
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5.14
Revenue from Sale of Power at Existing Tariff for FY 2011-12 BSEBs Submission
5.14.1 The Petitioner in its tariff petition for FY 2012-13 has only submitted the revised estimates of the expenses for FY 2011-12 but has not given any details of the revenue from sources such as revenue from sales of power, revenue from additional sales as well as revenue billed through FPPCA. On the query of the Commission, BSEB in the additional information submitted vide letter no. Com/ tar-132/ 2011-375 dated 1st March 2012 informed the Commission that the actual data for the period of April, 2011 to November, 2011 is not available as annual accounts are not yet finalized. Commissions analysis 5.14.2 In the absence of desired information, the Commission has computed the revenue based on revised sales and approved category-wise average realisation rate for FY 2011-12.
Table 85: Approved revised estimate of revenue through sale of power for FY 2011-12 (RE)
Category
Kutir Jyoti (Rural) Kutir Jyoti (Urban) DSI (Rural) DSII Single phase Three phase NDSI (Rural) NDSII (Urban) Single phase Three phase NDSIII LTISI LTISII Public Water Works IASI (Private) IASII (Government) Street LightI (Metered)
FY 2011-12 (Approved Revenue as per Tariff Order) (Rs. Cr.) 39.92 0.40 104.07 364.35 26.07 4.29 206.28 129.63 2.02 100.65 38.80 50.50 28.54 26.95 1.32
Approved by Commission in revised estimate for FY 2011-12 (RE) Average Energy Sale Revenue (Rs. Realisation (MU) Cr.) (Rs./Unit) 323 2.37 76.65 1 925 1,201 16 21 317 190 16 162 104 60 272 167 6 1.8 1.88 3.34 3.45 2.5 6.69 7.1 3.66 5.51 6.12 4.22 1.3 2.44 4.03 0.23 173.87 401.26 5.54 5.15 211.83 134.88 5.76 89.31 63.91 25.48 35.31 40.75 2.26
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TARIFF ORDER FOR FY 2012-13 Approved by Commission in revised estimate for FY 2011-12 (RE) Average Energy Sale Revenue (Rs. Realisation (MU) Cr.) (Rs./Unit) 28 3.45 9.51 799 351 125 277 567 5,928 5.59 5.37 5.15 3.77 5.29 446.40 188.71 64.61 104.38 299.88 2,386
Category
Street LightII (Unmetered) HTSSI HTSSII HTSSIII HTSS RTSI Grand Total
5.14.3 The Commission has approved the revenue at existing tariffs as per the revised estimate of approved sales and the approved average realisation for FY 2011-12. The revenue at existing tariff is computed at Rs 2,386 Cr. 5.15 Revenue from sale to Nepal & UI BSEBs Submission 5.15.1 BSEB has sold 555 MU of energy to Nepal at rate of Rs. 4.66 per kWh in FY 201011. BSEB projected the same trend to continue for FY 2011-12. BSEB has projected revenue from sale of power to NEA for FY 2011-12 at Rs. 258.63 Cr.. 5.15.2 BSEB has projected that sale under UI for the FY 2011-12 will be same as that of FY 2010-11. BSEB has projected its revenue from sale of power under UI assuming average price of Rs. 3.09 per unit equal to the rate for FY 2010-11. Revenue from sale of power under UI for FY 2011-12 is projected at Rs. 90.54 Cr.. Commissions analysis 5.15.3 The Commission approves the projected sales to Nepal at 555 MU, as it is obligatory to supply power to Nepal and accordingly approves projected revenue from sale of power to NEA for FY 2011-12 at Rs. 258.63 Cr. 5.15.4 The Board has projected the energy sales of 293 MUs under un-scheduled interchange (UI)] for the FY 2011-12. The Commission is of the view that, as per the energy balance the Board is left with additional power to the extent of 2200 MUs. BSEB has submitted that, the BSEB shall supply 171 MUs additional power to towns where premium tariff is proposed, industrial categories on LT line, urban areas, PWW and Street Lights. Accordingly, the Commission approves 171 MUs for sale under UI
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as prima facia it seems that it will not impact the supply hour of existing and proposed consumer base of BSEB. Accordingly, the Commission approves the proposed sale under UI for the FY 2011-12 @ Rs. 3.49 per unit, which is the average cost of power purchase for an amount of Rs. 102.36 Cr. 5.16 Revenue from sale of Additional Power BSEBs Submission 5.16.1 The Petitioner has not projected any revenue from sale of additional power in FY 2011-12. Commissions analysis 5.16.2 BSEB has projected energy balance at the projected T&D loss level of 42%. The Commission has already given T&D loss target of 29% to BSEB for the FY 2011-12 in its Tariff Order for FY 2011-12 dated 1st June, 2011. For FY 2011-12 (RE), the Commission has worked out energy balance based on T&D loss level of 29% as against 42% projected by BSEB. Also, in the energy balance, BSEB is proposing availability of 171 MUs of additional power in BSEB system for sale. The Board has proposed to sell this additional power @ Average Energy realisaiton rate of LT consumers (excluding KJ and agriculture). Considering the supply shortage situation in the State, the Commission is of the opinion that BSEB can sell higher amount of energy and to that extent it can bill higher revenue.
Table 86: Additional Revenue for the FY 2011-12 (RE)
Particular Energy available for sale to Consumers Average Energy realisaiton rate (excluding KJ & agriculture) Additional revenue at existing tariff
Unit MU Rs./Unit Rs. Cr.
FY 2011-12 Approved by Commission 171 3.17 54.23
5.17
Disincentive for non-achievement of T&D loss reduction Targets
5.17.1 The difference in the actual power purchase and the power purchase requirement approved by the Commission is disallowed at the average power purchase rate and is treated as Disincentive for non-achievement of T&D loss targets. 5.17.2 As per the trajectory, the T&D loss reduction target for FY 2011-12 was set at 29% which the Petitioner has not achieved as per the review petition of BSEB. Accordingly, the Commission has computed the disincentive for non-achievement of
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T&D loss reduction targets at Rs. 841.70 Cr. for FY 2011-12, subject to true-up, as and when the audited accounts of the Board will be submitted by the Petitioner for FY 2011-12.
Table 87: Disincentive for non-achievement of T&D loss reduction target for FY 2009-10
Particular Net Power Purchase Dis-allowed Disallowed units of NVVNL Disallowed power purchased cost of NVVNL @ 4.09 per unit Cost of Power Purchase Dis-allowed (NVVNL) Balance units of disallowed power Average Power purchase cost except NVVNL Cost of power purchase dis-allowed (other sources) Total dis-allowed power purchase cost
Units MUs MUs Rs./ kWh Rs. Cr. MUs MUs Rs. Cr. Rs. Cr.
FY 2011-12 2,210.05 1,303.56 4.09 532.56 906.49 3.41 309.14 841.70
5.18
Resource gap funding received from State Government for FY 2011-12
5.18.1 In response to Commissions query vide letter No. BERC- Tariff-24/ 11-244 dated 15th March 2012 regarding resource gap funding support from State Govt. for FY 2011-12 the BSEB vide letter No Com/ tariff-161/ 2011 (part) 444 dated 16th March 2012 informed the Commission that the projected resource gap funding support for FY 2011-12 from State Government is Rs. 1800 Cr. 5.18.2 The details of month-wise resource gap funding received from State Government during FY 2011-12 till February, 2012 as submitted by BSEB is as below:
Table 88: Details of Resource gap funding from State Government (Rs. Cr.)
Sl. 2 3 4 5 6 7 8 9 10 11
Particular April, 2011 May, 2011 June, 2011 July, 2011 August,2011 September, 2011 October, 2011 November, 2011 December, 2011 January, 2011
Resource Gap 90.00 90.00 90.00 90.00 180.00 180.00 180.00 180.00 180.00 180.00
Compensation against financial loss due to procurement of additional power 130.00 380.00 -
Total 90.00 90.00 90.00 90.00 180.00 310.00 180.00 180.00 560.00 180.00 Page 144
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TARIFF ORDER FOR FY 2012-13 Compensation against financial loss due to procurement of additional power 510
Sl. 11 14 15
Particular February, 2011 March, 2011 (Expected) Total
Resource Gap 180.00 180.00 1800.00
Total 180.75 2310
5.18.3 The BSEB in additional information has submitted that it has received resource gap assistance amounting to Rs. 1800 Cr. and Rs. 510 Cr. as compensation against financial loss due to procurement of additional power by the State Government. Out of 2310 Cr.; Rs 1080 is treated as resource gap grant for reducing ARR gap as approved in the Tariff Order for FY 2011-12. Rs. 841.70 Cr. of the State Government grant is adjusted against the financial loss caused to BSEB due to higher T&D loss than the T&D loss approved by Commission. The balance amount of Rs. 388.30 ( = 2300 1080 841.70) out of the total State Government grant is the additional revenue available with BSEB which is shown as receipt in the ARR. The amount of Rs. 841.70 Cr. against financial loss to BSEB includes all kinds of losses to BSEB such as additional power purchse, Non-achievement of T&D loss trajectory set bt the Commission, loss on account of power purchase from NVVNL.
Table 89: details of State Government revenue gap support (Rs. Cr.)
Particular Resource gap from State Government Compensation against financial loss due to procurement of additional power Total Resource gap funding spport fro State Government for FY 2011-12 Less: Resource gap grant for reducing ARR gap as per Tariff Order for FY 201112 Less: Dis-allowed power purchase cost on account of high T&D losses w.r.t. BERC target Resource gap available with BSEB
Amount (Rs. Cr.) 1,800.00 510.00 2,310.00 1,080.00 841.70 388.30
5.19
Aggregate Revenue Requirement of BSEB for FY 2011-12
5.19.1 The table below summarises the revised estimate of ARR approved by the Commission for FY 2011-12 subject to final true-up as and when the audited accounts of the Board will be submitted by the Petitioner for FY 2011-12:
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Table 90: Aggregate Revenue Requirement for the FY 2011-12
Sl.
Particular
FY 2011-12 (Approved in tariff Order) 3,328.00 80 95 798 52 117 149 86 4,705.00 168 4,537.00 2,769.00 224 220 1,325.00 1,080.00
FY 201112 (Revised Estimate) 4,162.94 93.48 100.62 829.8 53.49 154.21 464.31 163.31 231.47 6,253.63 48.54 754.26 5,450.83 258.63 90.54 54.23 -
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22
Power Purchase Cost Fuel R&M Cost Employee Cost A&G Cost Depreciation Interest & Financial Charges Interest on Working Capital Return on Equity Total Revenue Requirement Less: Non-Tariff Income Less : Disallowable Power Purchase Cost Net Revenue Requirement Less: Revenue from existing tariff Less: Revenue from sale of power to Nepal Less: Revenue from sale of power in UI Less: Revenue from sale of addl. Power Less: Revenue through FPPCA Gap Less: Resource gap grant for reducing ARR as per T.O. for FY 2011-12 Less: Additional resource gap available with BSEB Net Gap/ (Resource)
Now approved for FY 2011-12 (RE) 4,156.89 72.04 100.62 641.41 70.72 108.42 94.56 104.82 5,349.47 122.28 841.70 4,385.49 2,385.69 258.63 102.36 54.23 790.91 * 793.67 1,080.00 388.30
245.00
(674.63)
* As per FPPCA order & provisional billing by BSEB against FPPCA for period from October 2009 to December 2011
5.19.2 The Commission approves the net revenue surplus of Rs 674.6 Cr for FY 2011-12 in revised estimate subject to final true-up as and when the audited accounts of the Board will be submitted by the Petitioner for FY 2011-12. From the above table it can be seen that after considering the resource gap assistance amounting to Rs. 1080 Cr. by the State Government, over and above the State Government support for financial loss on account of non-achievement T&D loss target as set by the Commission, the net revenue surplus approved by the Commission for FY 2011-12 is Rs. 674.6 Cr. as against the regulatory assets created by the Commission in the Tariff Order for FY 2011-12.
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6 Analysis of Aggregate Revenue Requirement for FY 2012-13
6.1 6.1.1
Background This chapter covers item-wise Petitioners submission and Commissions analysis on the ARR and tariff petition for FY 2012-13. To determine the ARR of the BSEB for FY 2012-13, the Commission has projected the power purchase requirement of the Petitioner on estimated category wise sales based on past trends and taking into account the normative distribution losses fixed for FY 2012-13 by the Commission. The power purchase cost of the Petitioner for FY 2012-13 has been arrived at on the basis of actual purchase cost from April, 2011 to January, 2011. The Commission thereafter, analysed the other elements of ARR such as Depreciation, O&M expenses, Interest and Finance Charges and Working Capital requirement etc. to reflect the total ARR of the Petitioner for FY 2012-13. For this purpose, the Commission has examined the original as well as subsequent submissions of the Petitioner including audited accounts of FY 2010-11. The Petitioners submissions and Commissions approach towards determination of different elements of the ARR is discussed in detail in the subsequent paras of this Chapter.
6.1.2
The Commission validated the information submitted by BSEB in its ARR and tariff petition. The Commission held a Technical Validation Sessions (TVS) with the Officers and Consultants of BSEB from 28th February, 2012 to 1st March, 2012. During the validation session the Commission pointed out inconsistencies in data related to energy sales. In the petition, BSEB did not explain the methodology for break-up of category and sub-category wise sales into the different consumer subcategories. The Commission sought clarification in this regard, although the BSEB could not explain the methodology during the Technical Validation Sessions (TVS).
6.2
Energy Sales Petitioners Submission
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6.2.1
BSEB has used consumer category wise trend analysis Cummulative Annual Growth Rate (CAGR) to estimate number of consumers, connected load and energy consumption. This is based on the assumption that the historical trend would continue into the future as well. However, BSEB has used different CAGR for different consumer categories and also different CAGR for projecting number of consumers, connected load and energy sales for a consumer category/subcategory.
6.2.2
The Board has not furnished the basis on which the category-wise Number of consumers, connected load and sales for FY 2012-13 has been projected. The Board has however furnished the actual energy sales for the period of FY 2005-06 to FY 2010-11 and estimated consumption for the FY 2012-13 in its ARR and tariff petition.
6.2.3
BSEB has submitted consumer category wise past energy sales, number of consumers and connected load and their respective CAGR for different periods (fiveyear, four-year, three-year, two-year and year-on-year) for projecting sales for FY 2012-13. However, the Board did not submit the energy sales information for estimating sub-category wise revenue as per the existing tariff schedule. The Commission expects improved information support from BSEB in this regard in future tariff petitions. BSEB should improve its collection and analysis of information related to metering, billing and collection. Commissions Analysis
6.2.4
The Commission has projected the energy sales for FY 2012-13 using the method adopted by the Petitioner by applying compound annual growth rate (CAGR) for all consumer categories after considering actual sales of FY 2010-11 as base value. However, the Commission has also used the approved sales norms, trends of specific consumption (for categories which have stable specific consumption and follows current business environment) for projecting sales of the consumer categories. The approach adopted by the Commission for different consumer category has been elaborated in respective sections.
6.2.5
The Commission vide letter No BERC-Tariff-24/ 2011-244 dated 15th March, 2012 enquired about the basis of segregating number of consumers, connected load, and unit sales in subcategory of DS1, DS2, NDS1, NDS2. The BSEB vide letter No Com/ Tariff-161/ 2011 (part)- 444 dated 16th March 2012 stated that the Board has shown no. of consumers, connected load and unit sales in sub-categories of DS-I, DS-II, NDS-I and NDS-II based on the revenue Statement I received from field office on
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the basis of consumers ledger. However, the Board has not made available the same to the Commission for scrutiny and analysis. 6.2.6 Category-wise break up of past energy sales and CAGR for different periods (fiveyear, four-year, three-year, two-year and year-on-year) as submitted by BSEB is given below:
Table 91: Historical Trend in category-wise units sold (MUs) Consumer Category FY 2005-06 FY 2006-07 FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11
Kutir Jyoti Domestic Commercial Public Lighting IAS PWW Industrial L.T. Industrial H.T. Railway Inter State Total
86.52 1,217.37 313.33 19.86 887.48 178.24 112.55 673.51 358.76 494.32 4,341.94
86.52 1,363.93 309.19 25.18 709.14 163.90 111.17 762.08 383.92 626.65 4,541.68
54.00 1,645.98 371.85 23.90 659.12 150.98 139.02 964.14 384.80 457.77 4,851.56
91.18 1,677.53 416.92 22.69 776.72 160.93 152.72 1,275.40 399.81 350.74 5,324.64
92.41 1,872.32 470.19 26.99 794.01 143.49 192.45 1,475.09 444.82 555.45 6,067.22
163.91 1,969.25 490.37 33.17 388.60 60.39 226.49 1,500.63 457.95 848.38 6,139.14
Consumer Category
Table 92: Category-wise growth rates of sales 1-Yr CAGR 2-Yr CAGR 3-Yr CAGR
4-Yr CAGR
5-Yr CAGR
Kutir Jyoti Domestic Commercial Public Lighting Irrigation & Agriculture Public Water Works Industrial L.T. Industrial H.T. Railway Inter State Total
77.4% 5.2% 4.3% 22.9% -51.1% -57.9% 17.7% 1.7% 3.0% 52.7% 1.2%
34.1% 8.3% 8.5% 20.9% -29.3% -38.7% 21.8% 8.5% 7.0% 55.5% 7.4%
44.8% 6.2% 9.7% 11.5% -16.1% -26.3% 17.7% 15.9% 6.0% 22.8% 8.2%
17.3% 9.6% 12.2% 7.1% -14.0% -22.1% 19.5% 18.5% 4.5% 7.9% 7.8%
13.6% 10.1% 9.4% 10.8% -15.2% -19.5% 15.0% 17.4% 5.0% 11.4% 7.2%
6.2.7
Category-wise break up of past data of no. of Consumers and CAGR for different periods (five-year, four-year, three-year, two-year and year-on-year) as submitted by BSEB is as given table below:
Table 93: Category-wise no. of consumers
Consumer Category
FY 2005-06
FY 2006-07
FY 2007-08
FY 2008-09
FY 2009-10
FY 2010-11
Kutir Jyoti
240,349
240,349
248,293
258,221
319,244
579,852
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Consumer Category
FY 2005-06
FY 2006-07
FY 2007-08
FY 2008-09
FY 2009-10
FY 2010-11
Domestic Commercial Public Lighting IAS PWW Industrial L.T. Industrial H.T. Railway Inter State Total
1,038,658 138,166 342 57,581 647 10,718 667 13 1 1,487,142
1,386,639 146,847 379 57,581 689 11,647 699 13 1 1,844,844
1,513,675 158,646 341 55,762 762 12,933 763 15 1 1,991,191
1,671,636 167,422 359 51,442 818 13,821 870 15 1 2,164,605
1,797,404 190,089 379 59,121 768 18,917 929 15 1 2,386,867
1,938,023 195,145 306 54,709 923 17,144 915 15 1 2,787,033
Table 94: Category-wise growth rates of no. of Consumers Consumer Category 1-Yr CAGR 2-Yr CAGR 3-Yr CAGR 4-Yr CAGR 5-Yr CAGR
Kutir Jyoti Domestic Commercial Public Lighting Irrigation & Agriculture Public Water Works Industrial L.T. Industrial H.T. Railway Inter State Total
81.6% 7.8% 2.7% -19.3% -7.5% 20.2% -9.4% -1.5% 0.0% 0.0% 16.8%
49.9% 7.7% 8.0% -7.7% 3.1% 6.2% 11.4% 2.6% 0.0% 0.0% 13.5%
32.7% 8.6% 7.1% -3.5% -0.6% 6.6% 9.9% 6.2% 0.0% 0.0% 11.9%
24.6% 8.7% 7.4% -5.2% -1.3% 7.6% 10.1% 7.0% 3.6% 0.0% 10.9%
19.3% 13.3% 7.1% -2.2% -1.0% 7.4% 9.8% 6.5% 2.9% 0.0% 13.4%
6.2.8
Category-wise break up of past data of connected load and CAGR for different periods (five-year, four-year, three-year, two-year and year-on-year) as submitted by BSEB is as given below:
Table 95: Category-wise connected load
Consumer Category
FY 2005-06
FY 2006-07
FY 2007-08
FY 2008-09
FY 2009-10
FY 2010-11
Kutir Jyoti Domestic Commercial Public Lighting IAS PWW Industrial L.T. Industrial H.T. Railway Total
14,507 1,411,332 238,543 5,840 247,003 18,726 115,059 251,991 99,000 2,402,001
14,507 1,411,332 238,543 5,840 247,003 18,726 115,059 251,991 99,000 2,402,001
15,003 1,526,959 270,641 4,990 229,933 19,862 126,276 288,460 102,150 2,584,274
14,807 1,729,924 305,971 4,202 206,475 21,385 134,812 317,336 103,000 2,837,912
19,416 1,996,915 373,932 4,586 209,719 17,093 162,297 333,413 102,150 3,219,521
34,934 2,228,984 434,253 5,636 215,234 18,741 176,872 348,353 102,150 3,565,157
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Table 96: Categorywise growth rates of connected load 1-Yr CAGR 2-Yr CAGR 3-Yr CAGR 4-Yr CAGR
Consumer Category
5-Yr CAGR
Kutir Jyoti Domestic Commercial Public Lighting Irrigation & Agriculture Public Water Works Industrial L.T. Industrial H.T. Railway Total
79.9% 11.6% 16.1% 22.9% 2.6% 9.6% 9.0% 4.5% 0.0% 10.7%
53.6% 13.5% 19.1% 15.8% 2.1% -6.4% 14.5% 4.8% -0.4% 12.1%
32.5% 13.4% 17.1% 4.1% -2.2% -1.9% 11.9% 6.5% 0.0% 11.3%
24.6% 12.1% 16.2% -0.9% -3.4% 0.0% 11.3% 8.4% 0.8% 10.4%
19.2% 9.6% 12.7% -0.7% -2.7% 0.0% 9.0% 6.7% 0.6% 8.2%
6.3 6.3.1
Consumption by Un-metered Categories The Board in its ARR & tariff petition for FY 2012-13 has stated that the following categories of consumers under BSEB are un-metered: Kutir Jyoti consumers in rural & urban areas Domestic consumers in rural areas Nondomestic consumers in rural areas Street lights Consumers both in urban and rural areas Irrigation/ Agriculture pump sets (Private and State Government)
6.3.2
The Board in its ARR and tariff petition has computed the consumption of above un-
metered categories of consumers on the basis of the following norms:

Kutir Jyoti (Rural): 18 Units per month per connection Kutir Jyoti (Urban): 30 Units per month per connection DSI: 80 Units per month per connection NDSI: 80 Units per month per connection IASI (Private): 1485 Units per annum per KW IASII (State): 225 Units per month per HP Street Light: Based on past trend
6.4
Kutir Jyoti (Rural and Urban) Petitioners Submission
6.4.1
BSEB in its tariff petition has submitted that in view of the increased power availability to BSEB in the current year and in the ensuing year, BSEB has increased
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the power supply hours to the rural areas of Bihar to all consumer categories. Accordingly, the Kutir Jyoti consumers are being supplied power for increased number of hours. For the purpose of projecting the energy sold to the Kutir Jyoti unmetered category of consumers, BSEB has used normative consumption of 18 units per month per connection for unmetered rural areas and 30 units per month per connection for metered rural area & metered urban area. The number of consumers used for this projection is the average of the opening and closing number of consumers for the year. 6.4.2 BSEB has also submitted that, as per the Commission direction, BSEB has undertaken a sample study of consumption by Kutir Jyoti consumers. Based on this sample study the average monthly consumption of Kutir Jyoti consumers is determined to be 29.90 units per month. However, the average monthly consumption of 29.90 units was arrived at by the Board based on the data of ten (10) consumers of village Mahatbar under electric supply sub-division Biharsharif (Rural) and fifteen (15) consumers of Central electric supply area Panta. Accordingly, BSEB prays to the Commission to approve the considered consumption norm of 30 units per month for Kutir Jyoti consumers for FY 2012-13. However, BSEB has submitted to consider consumption norm of 18 units per consumer per month for projecting sales of Kutir Jyoti (Rural - Unmetered). 6.4.3 BSEB has also submitted that in other states of the country the consumption norm for rural and urban Kutir Jyoti is 30 units/ month. The table below reproduces the submission made by BSEB in regard to consumption norms followed by other boards/ distribution licensees.
Table 97: BPL consumption norms in other states
Sl.
State
Allowed units for BPL Consumers 18 units for rural areas 30 units for urban areas. Benefit of concessional tariff given to the first 30 units consumed by BPL consumers. Above that normal DS tariff charged. 30 units per connection per month allowed irrespective of geographical location 40% of total consumers in BPL assumed to have sales of 80 units per month and accordingly billed on other domestic rates. For all other consumers in BPL category 30 units per connection per month approved in Tariff Order for FY10.
Bihar (BSEB)
2.
Gujarat Madhya Pradesh
Chhattisgarh
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Sl.
State
Allowed units for BPL Consumers 26 units per connection per month allowed assuming 8 hours of supply per day for a connected load of 110W 30 units per connection per month Connected load of upto 1000 W allowed to BPL consumers Free electricity provided to BPL consumers upto the first 100 units
Tamil Nadu
Maharashtra
Punjab
6.4.4
In view of the above, the Board has requested the Commission to consider the consumption norm of 30 units per connection per month for both urban and rural Kutir Jyoti consumers of the state.
6.4.5
BSEB has projected an addition of 8,86,499 consumers during FY 2011-12 & 12,96,104 consumers during FY 2012-13 in Kutir Jyoti metered category in the rural areas. The sale to the Kutir Jyoti metered consumers in the rural areas has been projected based on consumption norm of 30 units per connection per month and average number of consumers in this tariff category.
6.4.6
Accordingly, the sales for Kutir Jyoti consumers have been projected at 324.70 MU for FY 2011-12 as against approved level of 263 MU. For FY 2012-13, BSEB has projected sale of 717.57 MU for Kutir Jyoti category. Commissions Analysis
6.4.7
The Commission is of the view that as the Kutir Jyoti services in rural and urban areas are allowed at connected load of 60 watt and 100 watt respectively, with restricted hours of supply, it would be difficult to consume 30 units with 60 watt connected load in rural areas. In view of the same, the Commission has approved the consumption norm of 18 units/ service/ month in rural areas and 30 units/ service/ month in urban areas in the Tariff Order for FY 2010-11.
6.4.8
In the Tariff Order issued by the Commission on 1st June, 2011 for FY 2011-12 the Commission has stated that, The comparison drawn with other states has to be viewed in the context that the all India per capita consumption is 774 units as against 107 units in Bihar. In view of the above observations, the Commission finds no reason to revisit its stated position on consumption norm for this consumer category. The Commission shall continue to use
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consumption norm of 18 Units/month for unmetered rural and 30 Units/month for unmetered urban Kutir Jyoti consumers. The Commission would like to emphasis once again that if BSEB desires Commission to revisit the norms for unmetered categories it has to provide sufficiently credible evidence and at the same time meter such unmetered consumers. 6.4.9 Further the tariff schedule provides the flexibility for billing at DS-I tariff rates by BSEB to consumers found using load more than that provided for Kutir Jyoti connections. The Commission cannot condone BSEB for its inability to implement this provision of the tariff schedule. The Commission is of the opinion that the consumption norm of 29.90 units per consumer per month which has been arrived at based on survey of twenty-five (25) consumers can not be representative of the consumption of entire Kutir Jyoti consumer base of BSEB. In spite of a standing direction and repeated reminders of the Commission to submit concrete evidences in the form of field data/studies in this regard, BSEB till date has failed to provide any such study/data. 6.4.10 The Commission has also taken into consideration the verification report submitted by the consultant appointed by the Commission for the purpose, which has also substantiated consumption pattern of 18 units per month for Kutir Jyoti rural consumers. Above all, although the Kutir Jyoti consumers in urban areas are metered, the Board has not furnished the consumption based on meter readings. Hence the consumption for this category is assessed 30 units / month / service. Further, BSEB vide letter no. Com/Tar/161/2011-260 dated 9th February, 2012 has submitted that BSEB is in stabilisation phase in terms of release of Kutir Jyoti Connections and its billing. For projection, 30 units have been considered for KJ metered (rural & urban) consumers. Actual sales will be taken into account at the time of truing up process. 6.4.11 On the matter of sales to unmetered Kutir Jyoti Consumers BSEB vide letter no. Com/Tar/161/2011-260 dated 9th February, 2012 submitted that BSEB proposes no increase in no. of unmetered consumers as only metered connections are released by BSEB. BSEB is in the process of installation of meters to all its unmetered consumers in phased manner and intends to complete the process by March, 2013. At the same time, it is not possible to assess category-wise metering by BSEB. For projection of tariff based on the tariff schedule, it is desirable that the existing status is considered and at the time of true-up based on the actual scenario revenue is
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considered. BSEB has also submitted that as per Tariff Schedule of Tariff Order, only Kutir Jyoti Urban (meter) category exists and hence all consumers are considered as metered while calculating revenue from sale of power. 6.4.12 The number of consumers as projected by the BSEB is accepted as large numbers of villages are being electrified and BPL households are connected under RGGVY. 6.4.13 As per BSEB submission with regard to the process of installation of meters to all its unmetered consumers in phased manner and its intention to complete the process by March, 2013, the Commission has approved Kutir Jyoti consumption based on the norms approved for FY 2011-12. As all the connections under Kutir Jyoti are expected to be metered by March, 2013, there will not be unmetered consumer.
Table 98: Approved Kutir Jyoti Consumption for FY 2012-13
Details Rural (un-metered) Rural (metered) Urban (metered) Total
No. of consumers 302914 2455970 3571 2762455
Norm Adopted/ month 18 unit 30 unit
Consumption for 2012-13 (MUs) 32.71 423.23 1.46 457.40
6.4.14 The Commission approves 18 units/ service/ month in rural areas and 30 units/ service/ month in urban areas. Based on this norm the Commission approves 457.40 MUs to Kutir Jyoti (rural and urban) for FY 2012-13 as detailed above against projected sale of 717.57 MUs by BSEB. 6.5 Domestic - I (Rural) (DS-I) Petitioners Submission 6.5.1 BSEB in its petition has submitted that it has witnessed a near double digit growth in the last few years in the units sold to this category and it expects the same trend to continue in future years as well. The number of consumers in the Domestic category has witnessed a five years CAGR of 13.3% between FY 2005-06 and FY 2010-11. BSEB expects that this trend will continue in future also. For DS-I Category, BSEB has projected the number of consumers for FY 2012-13 based on the 5 years CAGR of 13.3% at 1159387 consumers. 6.5.2 For the FY 2011-12, BSEB has proposed revised sales estimate for this category at 924.86 MU as against 886 MU approved by the Commission. As per the
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consumption norms of 80 units per month per consumer, the sales for FY 2012-13 have been projected at 1047.74 MU. Commissions Analysis 6.5.3 The Commission after analysing the data for DS-I category for FY 2010-11 is of the opinion that specific consumption of DS-I consumer category is relatively stable. For domestic category consumers, 5 years CAGR would be more appropriate trend for projecting no. of consumers and connected load for FY 2012-13. 6.5.4 The Commission, in-line with the approach used in its past Tariff Order, has considered the specific consumption of 80 units / connection / month, which has been adopted by the Board for this category. Accordingly, the Commission considering FY 2010-11 as the base year, CAGR of 5 year and the consumption norm of 80 units/ connection/ month, approves energy sale for FY 2012-13. 6.5.5 The Commission approves sale of 1047.74 MUs for the DS-I category of consumers for FY 2012-13 as proposed by BSEB. However the Commission again directs BSEB to completely meter this consumer category by FY 2012-13. 6.6 Domestic Metered (Urban) - DS-II Petitioners Submission 6.6.1 BSEB has projected the number of consumers, connected load and energy sales for DS-II category for FY 2011-12 & FY 2012-13 at the 5 years CAGR of 13.3%, 9.6% & 10.1% respectively taking FY 2010-11 as the base year. For the FY 2011-12 BSEB revises the sales estimates for this category at 1217.44 MU as against 1424 MU approved by the Commission. For FY 2012-13, BSEB has projected sale of 1340.37 MU. Commissions Analysis 6.6.2 On scrutiny of the Schedule -3 of the Annual accounts of FY 2010-11 it was observed that the specific consumption of Domestic-II category of consumers during FY 201011 was 92.42 kWh computed on the basis of average number of consumers during FY 2010-11. However, the BSEB in its tariff petition for FY 2012-13 has projected the specific consumption of 89.36 kWh computed on the basis of average number of consumers during FY 2012-13. The Commission from the past petitions of the BSEB
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has also observed that the specific consumption over the years has gone up. Since the consumers are in urban areas where the quality of supply is said to have been improved, the projected specific consumption below the current level as proposed by the BSEB doesnt seems proper. 6.6.3 The BSEB in its petition has also stated that, BSEB is purchasing power through short/medium term agreement from NVVNL and will provide this power to categories where hours of power supply is on lower side and to towns where premium tariff is proposed. 6.6.4 In light of the above facts, the Commission while approving the sales has considered the specific consumption of 95 kWh for DS-II category. Further, the Commission feels that the five (5) year CAGR on the base year of FY 2010-11 is more appropriate for projecting no. of consumer as well as connected load to this consumer category. Accordingly, the Commission approves the consumption of 1425.9 MUs for Domestic-II (DS-II) category for the FY 2012-13 against 1340.37 MUs as projected by BSEB. 6.7 Domestic - DS-III Petitioners Submission 6.7.1 BSEB has projected the energy sales at the 5 years CAGR of 13.3 %. BSEB revised the sale estimates for this category at 0.90 MU for FY 2011-12 and 0.99 MU projecting for FY 2012-13. Commissions Analysis 6.7.2 The Commission feels that the 5 year CAGR on the base year of 2010-11 is appropriate for projecting energy sales, no. of consumer as well as connected load to this consumer category. 6.7.3 The Commission, therefore, approves the consumption of 0.99 MU by DS-III category for the FY 2012-13. 6.8 Non-Domestic-I Rural (NDS-I) Petitioners submission
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6.8.1
The BSEB has submitted that the Non-Domestic-I (Commercial) tariff category is applicable to unmetered commercial consumers in the rural areas. The number of consumers and connected load for this consumer category for FY 2012-13 has been projected at 3 years CAGR of 7.1% & 17.1% respectively.
6.8.2
BSEB in its ARR and tariff petition for FY 2012-13 has revised the sales estimates for this category to 20.61 MU for FY 2011-12 as against 29 MU as approved by the Commission. Based on the consumption norm of 80 units per month per consumer, the sale for this category for FY 2012-13 has been projected at 22.08 MU. Commissions Analysis
6.8.3
The Commission is of the opinion that the consumption of commercial category is closely linked to current business environment. Therefore the Commission considers it reasonable to compute No. of consumers and connected load on the basis of three (3) year CAGR with FY 2010-11 as base year for this consumer category.
6.8.4
Further, as per BSEB submission with regard to the process of installation of meters to all its unmetered consumers in phased manner and intends to complete the process by March, 2013, the Commission has approved consumption based on the same.
6.8.5
The Commission accordingly approves energy consumption of 22.08 MU by NDS-I consumer category for the FY 2012-13, as projected by the BSEB in-line with the approach used by the Commission in tariff Order for FY 2011-12.
6.9
Non-Domestic-II Urban (NDS-II) Petitioners Submission
6.9.1
BSEB has projected the number of consumers, connected load and energy sales at three (3) years CAGR. Further, BSEB has revised its energy sales estimates to 506.61 MU for FY 2011-12 as against 575 MU as approved by the Commission. The sale for FY 2012-13 is projected at a three (3) years CAGR of 9.7% at 555.56 MU. Commissions Analysis
6.9.2
The Commission while analysing the past trends considered four (4) year CAGR more appropriate for projecting sales for FY2011-12. The Commission is of the opinion that the socio economy in the State is improving over the last few years
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which will have positive impact on the overall growth of Non-domestic category. There is an increasing trend of the specific consumption during the past five (5) years. In view of this, the growth of number of consumers, connected load and energy sales at four (4) years CAGR seems reasonable. 6.9.3 For reasons stated the Commission approves the energy consumption of 581.8 MUs for NDS-II category for the FY 2012-13, against 555.56 MUs as projected by BSEB. 6.10 Non-Domestic III (Religious Places) NDS-III Petitioners submission 6.10.1 BSEB has projected the number of consumers, connected load and energy sales for NDS-III based on 3 years CAGR. The energy sale for FY 2012-13 has been projected at 17.27 MU. Commissions Analysis 6.10.2 The Commission considers four (4) year CAGR for projecting sales, no. of consumers and connected load for FY2012-13. The Commission, therefore, approves the consumption of 18.08 MUs in the Non-Domestic III category for the FY 2012-13. 6.11 Industrial LTIS-I & II Petitioners Submission 6.11.1 BSEB has projected energy sales, connected load, number of consumers based on three (3) years CAGR between FY 2007-08 and FY 2010-11 for industrial LT I & II category. Thus no. of consumer, connected load and energy sales has been projected at 19317, 134666 kW and 190.72 MU for LTIS-I category and consumer, connected load and energy sales has been projected at 1371, 86753 kW and 122.87 MU for LTIS-II category. Commissions Analysis 6.11.2 The CAGR for the 3-year period is about 17.7% whereas growth considered by the Commission for projecting the sales of FY 2012-13 is four (4) year CAGR which is about 19.5%. Since there is scope for increasing the industrial production, it is not
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proposed to curtail the consumption of this category as the industry is picking up after the recession and there is scope for industrialization, particularly, with improvement in availability of power. The Commission approves the consumption of 196.6 MUs and 126.6 MUs for LT IS-I and LTIS II industry respectively for the FY 2012-13 as proposed by Board. 6.12 Street Lighting (Public Lighting) SS-I, SS-II Petitioners submission 6.12.1 BSEB in the ARR and tariff petition has submitted that the SS category has shown negative growth rate during the last 5 years. Accordingly, considering the improved power availability in the state, energy sales, connected load and number of consumers for all sub categories under street Lighting has been proposed at the previous year level. Thus the energy sale for the SS-I, SS-II & SS-III categories has been projected at 5.61 MU, 26.20 MU & 1.36 MU respectively. Commissions Analysis 6.12.2 The Commission while analysing data found that the No. of consumers in FY 201011 has decreased w.r.t. FY 2009-10 whereas the load and sales has increased during the same period. In this regard the Commission has enquired about the same from the BSEB vide Commissions letter No BERC-Tariff-24/ 2011-244 dated 15th March, 2012. BSEB in response stated vide letter No. Com/ Tariff-161/ 2011 (part)444 dated 16th March 2012 that the reason for decrease in no. of Consumers under Public Lighting during FY 2010-11 is also being looked into and the Commission will be informed accordingly. 6.12.3 The Commission does not appreciate the inability of BSEB to justify their trend of no. of consumers, connected load and sales. The Commission has also observed an abrupt increase in specific consumption during FY 2010-11 as per the records of audited annual accounts of the Board. This abnormal trend indicates the possibility of either more energy than that consumed is getting booked or the reported connected consumers is lower than the actual resulting in loss of fixed charges. The Commission again directs BSEB to investigate the reasons for such abnormal trend and report the same to the Commission within three months of issue of this order.
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6.12.4 The Commission is of the opinion that since a number of villages are being electrified under RGGVY and other electric infrastructure are being created, streetlights would be provided in all such case. Accordingly, the Commission approve growth in No. of Consumer, connected load and sales at a reasonable rate of 4% which is three (3) year CAGR of load growth. 6.12.5 The Commission approves the energy consumption of 6.98 MUs and 34.29 MUs for SS-I and SS-II category respectively under Public Lights (Street lights) for the FY 2012-13. 6.13 Irrigation and Agriculture Service (IAS-I & II) Petitioners submission 6.13.1 BSEB has projected energy consumption by irrigation and agricultural services at 271.63 MU for IAS-I category considering the consumption norm of 1485 units per kW per annum, and 317.05 MUs for IAS-II category considering the consumption norm of 225 units per HP per month for the FY 2012-13. 6.13.2 The BSEB has submitted that during past years the number of consumers has shown positive growth whereas connected load showed negative growth, whereas in the recent past, the number of consumers has shown a declining trend. Accordingly, BSEB has projected no change in the number of consumers and the connected load over FY2010-11 for FY 2012-13. 6.13.3 For IAS-II sub category, BSEB is expected to add 2764 tube wells having connected load of 20 kW each to its network in the month of December of FY 2011-12. 6.13.4 The Commission as additional information vide Commissions letter No BERC-Tariff24/ 2011-244 dated 15th March, 2012 enquired about the reason of decrease in No. of consumers and sales while load has been increasing during FY 2010-11. The BSEB vide letter No Com/ Tariff-161/ 2011 (part)- 444 dated 16th March 2012 informed the Commission that the reduction in unit sold under the Category Irrigation and Agriculture during FY 2010-11 is mainly due to implementation of revised norms of consumption (1485 units/ kWh/ annum) fixed by Commission in comparison to earlier norms of consumption (2000 units/ kWh/ annum) and also non-accountal of consumption by 20% disconnected consumers which was allowed by the Commission in their earlier Tariff Order for FY 2006-07 (para 6.3.5) assuming that a number of disconnected service might be using electricity and it may be difficult to
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effectively check these unauthorised connections in view of pump-sets spread out in large area and due to lack of adequate machinery. Commissions Analysis 6.13.5 The Commission has taken into consideration the verification report submitted by the third party independent consultant which has substantiated consumption pattern of 1485 units /kW/annum for agriculture consumers in absence of accurate metering. 6.13.6 For State tube wells, the Commission approves a consumption norm of 225 units/ HP per month as approved in the Tariff Order for FY 2011-12. 6.13.7 Further, as per BSEB submission with regard to the process of installation of meters to all its unmetered consumers in phased manner and intends to complete the process by March, 2013, the Commission has approved consumption assuming that all the unmetered consumers under IAS-I and II category would be converted into metered connection. 6.13.8 Accordingly, The Commission approves the consumption of 271.6 MU for IAS-I and 317.12 MUs for IAS-II category for FY 2012-13. 6.14 Public Water Works Petitioners submission 6.14.1 BSEB has projected an energy consumption of 60.39 MUs by this category for the year 2012-13. The BSEB has submitted that Public Water Works has witnessed negative growth over the past few years. The 3 years CAGR and 5 years CAGR for sales recorded between FY 2005-06 and FY 2010-11 are -26.3% and -19.5% respectively. Thus BSEB is expecting that the energy sales for FY 2011-12 and FY 2012-13 to this category will remain same as that of previous year at 60.39 MU. 6.14.2 The Commission as additional information vide Commissions letter No BERC-Tariff24/ 2011-244 dated 15th March, 2012 enquired about the reason of decrease in sales while No. of consumers and load has been increasing during FY 2010-11. The BSEB has not given any justification of such abnormalities in it response. Commissions Analysis
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6.14.3 The Commission while approving the sales has considered the five (5) years CAGR for projecting the no. of consumers and connected load. The Commission also disagrees with the sale projection provided by the BSEB. While approving sales for FY 2012-13 the Commission has considered the average of specific consumption for last five (5) years. The Commission also directs BSEB to investigate the reasons for drop in sales and intimate the Commission within three months of issue of this order. 6.14.4 The Commission in its tariff Order for FY 2011-12 has stated that The Commission has observed high load factor in past years. The Commission directs BSEB to investigate the reasons for such high load factor and report the same to the Commission within three months of issue of this order. 6.14.5 The Commission approves the consumption of 160.3 MUs for Pubic Water Works during the year 2012-13. 6.15 HT Industry (HTS-I, HTS-II, HTS-III and HTSS)
6.15.1 BSEB has projected the consumption of HT category (HTS-I, HTS-II, HTS-III and HTSS) at 1830.88 MUs for the FY 2012-13. 6.15.2 BSEB has calculated growth in sales, no. of consumers and connected load based on a three (3) year CAGR for HTS-I, HTS-II. 6.15.3 BSEB has also submitted that it will provide electricity supply in FY 2011-12 to upcoming Rail Wheel Factory at Chapra and in FY 2012-13 to Electric Locomotive factory at Madhepura under HTS-III sub-category. The contract demand of the Rail Wheel Factory is 26.67 MVA while Electric Locomotive Factory is 13.5 MVA. For projection of the connected load of new consumers, power factor of 0.9 is considered. For the projection of energy sales to new consumers BSEB has considered the load factor as per actuals of FY 2010-11. BSEB has projected number of consumers, connected load and energy sales in this sub-category for FY 2012-13 considering the addition of the above said consumers. 6.15.4 For HTSS category, no growth has been projected in no. of consumers, connected load and sales. BSEB projects number of consumers and connected load same as of FY 2010-11 during the FY 2011-12 & FY 2012-13. BSEB projects sale of 276.87 MU for FY 2012-13.
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Commissions Analysis 6.15.5 The Commission find it more appropriate to consider four (4) year CAGR for sales, no. of consumers and connected load for HTS-I, HTS-II sub-category. Since there is scope for increasing the industrial production, as the industry is picking up after the recession and there is scope for industrialization, particularly, with improvement in availability of power in the state of Bihar. Further, the Commission considered it reasonable to assume consumption of HTSS at least at the same level as in 201011. 6.15.6 The Commission approves the consumption of 2060.3 MUs (1613.7 MU for HTS-I, II & III and 446.5 MUs for HTSS sub-category ) for HT category the FY 2012-13. 6.16 Railway Traction Petitioners submission 6.16.1 BSEB has submitted that it will provide electricity supply in FY 2011-12 to Railways at T.S.S. Chapra, Hazipur, Pancrukhi, Samastipur, Jhajha with contract demand of 10.8 MVA each. In FY 2012-13 BSEB will provide electricity supply to Railways at T.S.S. Ramdayalunagar, Bachhwara, Khagaria, Naugachia, Katihar with contract demand of 10.8 MVA each. For projection of the connected load of new consumers, power factor at 0.9 has been considered by BSEB. For the projection of energy sales to new consumers for FY 2012-13, BSEB has considered the load factor as per actuals of FY 2010-11. 6.16.2 Thus for FY 2012-13, BSEB has projected number of consumers, connected load and energy sales at 25, 199350 kW and 784.77 MUs. Commissions Analysis 6.16.3 The Commission is of the view that, since there are no restrictions in the supply to railways and the full demand has to be met, the consumption proposed by the Board is agreed to. 6.16.4 The Commission approves the consumption of 784.77 MUs for railway traction during FY 2012-13 as proposed by the Board.
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6.17
Energy sales to Nepal (NEA)
6.17.1 BSEB has an obligation to provide around 50 MW of power to Nepal. BSEB has projected energy sale of 555 MU in FY 2012-13 based on the actuals of FY 2010-11 and the Commission approves the same. 6.18 Total Energy Sales, No. of Consumers & Connected Load Petitioners submission 6.18.1 BSEB has submitted that they are implementing premium tariff for the PESU area (all divisions), Rajgir area (11 kV Town Feeder & 11 kV Kund Feeder) and Bodh Gaya area (11 kV Bhagalpur Feeder, 11 kV PHED Feeder, 11 kV Town feeder, 11 kV Magadh University Feeder and 11 kV New Industrial Feeder). 6.18.2 BSEB in its ARR and tariff petition has separately projected number of consumers, connected load and energy sales in Premium tariff area as well as for the entire BSEB. For estimating sales to Rest of Bihar, sale projection of Premium tariff area was excluded from the sale projection of entire BSEB. The sale, connected load and number of consumers for premium tariff area and rest of Bihar as projected by BSEB is given below:
Table 99: Projected no. of consumers, connected load and energy sale - BSEB Number of Consumers Connected Load Energy Sales Category Kutir Joyti (R) Unmetered Kutir Joyti (R) Metered Kutir Joyti (Urban) D.S.-I D.S.-II D.S.- III N.D.S.-I N.D.S.-II N.D.S.-III IAS-I IAS-II LT Industrial-I LT Industrial-II Public Water work (PWW) Street light-I (Meterd) Street light-II (Unmetered) FY 201112 302,914 1,159,866 3,571 1,023,413 1,172,056 44 22,208 186,706 176 51,663 5,810 17,585 1,248 923 99 206 FY 201213 302,914 2,455,970 3,571 1,159,387 1,327,779 50 23,795 200,048 188 51,663 5,810 19,317 1,371 923 99 206 FY 201112 18,175 69,592 357 980,069 1,461,938 313 25,078 481,488 1,819 182,916 87,598 120,359 77,537 18,741 953 4,452 FY 201213 18,175 147,358 357 1,073,871 1,601,860 343 29,359 563,684 2,130 182,916 87,598 134,666 86,753 18,741 953 4,452 FY 201112 65.43 257.98 1.29 924.86 1,217.44 0.90 20.61 506.61 15.75 271.63 166.99 162.09 104.42 60.39 5.61 26.20 FY 201213 65.43 650.85 1.29 1,047.74 1,340.37 0.99 22.08 555.56 17.27 271.63 317.05 190.72 122.87 60.39 5.61 26.20
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Category Street light-III H.T.S.-I H.T.S.-II H.T.S.-III H.T.S.S. R.T.S. Total
Number of Consumers 1 919 37 2 15 20 3,949,483 1 976 40 3 15 25 5,554,152
Connected Load 231 229,417 75,707 35,660 50,169 150,750 4,073,319 231 244,308 80,621 47,810 50,169 199,350 4,575,704
Energy Sales 1.36 798.56 351.42 125.45 276.87 566.89 5,928.75 1.36 925.45 407.26 221.30 276.87 784.77 7,313.05
Table 100: Projected no. of consumers, connected load and energy sale Premium tariff Area Category Kutir Joyti (R) - Unmetered Kutir Joyti (R) - Metered Kutir Joyti (Urban) D.S.-I D.S.-II D.S.- III N.D.S.-I N.D.S.-II N.D.S.-III IAS-Il IAS-II LT Industrial-I LT Industrial-II Public Water work (PWW) Street light-I (Meterd) Street light-II (Unmetered) Street light-III H.T.S.-I H.T.S.-II H.T.S.-III H.T.S.S. R.T.S. Total Number of Consumers FY 2011FY 201212 13 1,373 2,473 289,369 131 62,637 45 2,112 118 3,380 430 99 8 62 448 8 4 362,697 1,373 2,802 327,816 140 67,113 48 2,112 118 3,713 472 99 8 62 476 9 4 406,365 Connected Load FY 2011FY 201212 13 137 2,603 460,125 169 165,197 481 10,448 549 29,512 20,274 5,884 204 1,049 88,889 24,431 14,187 824,140 137 2,853 504,163 197 193,398 563 10,448 549 33,020 22,684 5,884 204 1,049 94,658 26,017 14,187 910,012 Energy Sales FY 2011FY 201212 13 0.49 2.23 529.17 0.12 233.26 0.49 15.52 1.36 30.34 43.29 24.99 1.10 8.70 367.40 145.34 37.22 1,441.02 0.49 2.53 582.60 0.13 255.79 0.54 15.52 1.99 35.70 50.94 24.99 1.10 8.70 425.78 168.44 37.22 1,612.45
Table 101: Projected no. of consumers, connected load & energy sale Rest of Bihar Number of Consumers Category Kutir Joyti (R) - Unmetered Kutir Joyti (R) - Metered Kutir Joyti (Urban) D.S.-I FY 201112 302,914 1,159,866 2,198 1,020,940 FY 201213 302,914 2,455,970 2,198 1,156,585 Connected Load FY 201112 18,175 69,592 220 977,465 FY 201213 18,175 147,358 220 1,071,018 Energy Sales FY 201112 65.43 257.98 0.79 922.63 FY 201213 65.43 650.85 0.79 1,045.21
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Category D.S.-II D.S.- III N.D.S.-I N.D.S.-II N.D.S.-III IAS-Il IAS-II LT Industrial-I LT Industrial-II Public Water work (PWW) Street light-I (Meterd) Street light-II (Unmetered) Street light-III H.T.S.-I H.T.S.-II H.T.S.-III H.T.S.S. R.T.S. Total
Number of Consumers 882,687 44 22,077 124,070 131 49,551 5,692 14,205 818 824 91 144 1 471 29 2 11 20 3,586,786 999,963 50 23,655 132,936 140 49,551 5,692 15,604 899 824 91 144 1 500 30 3 11 25 5,147,787
Connected Load 1,001,813 313 24,909 316,292 1,338 172,468 87,049 90,847 57,263 12,856 749 3,403 231 140,528 51,276 35,660 35,982 150,750 3,249,179 1,097,696 343 29,161 370,286 1,567 172,468 87,049 101,646 64,070 12,856 749 3,403 231 149,650 54,604 47,810 35,982 199,350 3,665,692
Energy Sales 688.27 0.90 20.49 273.35 15.26 256.11 165.63 131.75 61.12 35.40 4.51 17.50 1.36 431.16 206.08 125.45 239.66 566.89 4,487.73 757.77 0.99 21.95 299.76 16.73 256.11 315.06 155.03 71.92 35.40 4.51 17.50 1.36 499.67 238.83 221.30 239.66 784.77 5,700.60
Commissions Analysis 6.18.3 The Commission vide letter No. BERC- Tariff 24/11- 825 dated 21st December, 2011 directed BSEB to furnish the assumption regarding break-up of No. of consumers, sales, load and revenue for premium tariff areas, rest of Bihar. However, in response the BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 has not submitted any clarification in this regard. It is also worth noting that the projected no. of Consumer in DS-II category for premium areas and rest of Bihar provided in the additional information vide BSEB letter No Com/Tar/161/2011-260 dated 09th February, 2012 is not matching with the one submitted by the BSEB in its ARR and tariff and the BSEB has also not submitted any reason thereof. 6.18.4 In view of the BSEB response showing their inability to justify their assumption for sub-category wise load, sales forecast and providing actual data of no. of consumers, connected load and sales for first six (6) month of FY 2011-12 for premium areas and BSEB as a whole, the Commission approves the Number of consumers, connected load and energy sales based on the trend analysis of the sales for various consumer category.
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6.18.5 Number of consumers, connected load and energy sales as approved by the Commission for the entire State is given in the table below:
Table 102: Approved no. of consumers, connected load & energy sales of BSEB for FY 2012-13 No. of Consumer Connected Load (kW) Sales (MUs) Category Projected by BSEB Kutir Joyti (R) Metered Kutir Joyti (Urban) D.S.-I D.S.-II D.S.- III N.D.S.-I N.D.S.-II N.D.S.-III IAS-I IAS-II LT Industrial-I LT Industrial-II Public Water work (PWW) Street light-I (Meterd) Street light-II (Unmetered) Street light-III H.T.S.-I H.T.S.-II H.T.S.-III H.T.S.S. R.T.S. Total 2,758,884 3,571 1,159,387 1,327,779 50 23,795 200,048 188 51,663 5,810 19,317 1,371 923 99 206 1 976 40 3 15 25 5,554,152 Approved by Commission 2,758,884 4,211 1,159,387 1,327,779 50 23,894 200,876 189 51,663 5,810 19,422 1,378 1,064 138 288 1 990 39 3 15 25 5,556,106 Projected by BSEB 165,533 357 1,073,871 1,601,860 343 29,359 563,684 2,130 182,916 87,598 134,666 86,753 18,741 953 4,452 231 244,308 80,621 47,810 50,169 199,350 4,575,704 Approved by Commission 165,533 357 1,073,871 1,601,860 343 28,902 554,912 2,097 182,916 87,598 133,374 85,921 18,747 1,034 4,828 251 253,298 83,588 47,810 50,169 199,350 4,576,757 Projected by BSEB 716.28 1.29 1,047.74 1,340.37 0.99 22.08 555.56 17.27 271.63 317.05 190.72 122.87 60.39 5.61 26.20 1.36 925.45 407.26 221.30 276.87 784.77 7,313.05 Approved by Commission 456 1 1,048 1,425 1 22 582 18 272 317 197 127 160 7 33 2 967 426 221 447 785 7,512
The sale to the consumers of premium tariff area projected by the BSEB in Table 100 is approved. The energy amounting to 5899 MU is approved as sale to rest of Bihar. 6.19 Transmission & Distribution Losses (T&D Losses) Petitioners submission 6.19.1 The Petitioner has submitted that the T&D losses of the Board are on the higher side as compared to the target set by the Commission because of lower unmetered consumption norm, inefficient meter billing due to defective meters etc. Further, dilapidated distribution network of BSEB has contributed to higher T&D losses of
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BSEB. Large scale rural electrification under RGGVY scheme leading to expansion of rural distribution network too has contributed to the T&D losses of BSEB. 6.19.2 Further, the Board has submitted that, the Commission had restated norms of unmetered consumption for Kutir Jyoti connections from 30 units per month to 18 units per month and for Agriculture connections of IAS-I category from 2000 units per annum to 1485 units per annum which are not reflective of the actual power consumption by these categories and is adding to the T&D losses of BSEB. Consequent to increased availability of power as reflected in the projected increase in power purchase quantum, BSEB would be able to increase number of hours of electricity supply to such consumers. This is expected to increase specific consumption of such consumers, in excess of the norms approved by the Commission. 6.19.3 The Board has also informed that BSEB has undertaken massive electrification works under the RGGVY scheme. There has been a tremendous increase in the network of BSEB in the last 2 years in the high loss rural areas consequent to village electrification. The village electrification drive has led to an addition of large number of Kutir Jyoti consumers. This number of such consumers is expected to go up to 27 lakhs within the next two years from 5.89 lakhs in FY 2010-11. This significant expansion of the network has not only led to increase in the technical losses in the system, but has also rendered the system porous and prone to theft of electricity. Due to both these reasons, BSEB has not been able to achieve the loss targets set by Commission. 6.19.4 The Commission vide letter No. BERC- Tariff 24/11- 825 dated 21st December, 2011 enquired about the reason of non-achievement of T&D loss target as specified by the Commission in spite of implementation of various schemes like RGGVY, RAPDRP etc. In response to this the BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 informed the Commission that the Board has been taking many steps for reduction in T&D loss as well as AT&C loss since 2006-07. However, T&D loss of the Board has been reduced by 4.51% only during the period from 200506 (42.83%) to 2009-10 (38.32%). The main reason for such a lower reduction in T&D loss by the Board even after making sustained efforts were explained as given below:-
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The Board has to supply electricity to Rural/BPL consumers (1212067 nos. as on 31.03.2010) having unmetered and fixed tariff. Any additional quantum of power supply to those consumers increases T&D loss / AT&C loss.
BERC has revised monthly/ annual consumption of the meterless category of consumers namely, Kutir Jyoti (Rural) and Agriculture & Irrigation (IAS-I) in its Tariff Order dated 06.12.2010. Accordingly, the monthly assumed consumption for Kutir Jyoti (Rural) has been reduced from 30 units per month to 18 units per month and the annual assumed consumption for IAS I from 2000 units per KW to 1485 units per KW. This revision in annual consumption has resulted into increase in T&D loss by 2.22 % every year with effect from 2010-11 in comparison to the period prior to 2010-11.
Schemes for reduction of T&D /AT&C loss from 11 KV to consumers' end has not yet been undertaken. It is an admitted fact that the AT&C loss is maximum in supply of power to the consumers below 11 KV.
APDRP Programme was mainly for strengthening of infrastructure of power supply at 132 KV and 33 KV as also metering of consumers in urban areas. It is relevant to mention here that the Board has made remarkable improvement in billing of HT consumers as would be evident from the following table:Table 103: Trend of No. of Consumer, connected load, unit and amount billed
Year 2005-06 2006-07 2007-08 2008-09 2009-10
No. of consumers 667 699 763 867 910
Connected load 248050 251991 288460 331053 333413
Unit billed (MUs) 673.51 762.08 964.14 1275.40 1475.09
Amount billed (Rs. Cr.) 295.27 341.46 423.25 546.38 631.93
It would be clear that the connected load of HT consumers increased by 34.44% during the period from 2005-06 to 2009-10 whereas, the unit billed increased by 119.02% during the said period.
The infrastructure for supply of electricity from 11 KV to the consumers' end is very old and the conductors at many places are of Iron made having maximum technical loss. As already stated, capital projects for replacement of conductors has been taken up but it is expected to be completed by 2-3 years from now, depending upon availability of fund from State Govt.
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Board's financial position is alarming and it is not in a position to even meet urgent expenditure such as, payment to power suppliers, establishment expenses as also O&M expenses. Under the circumstances it is difficult to generate any fund for strengthening of its infrastructure including metering of consumers below 11 KV level. The Board is fully dependent on the State Govt. for metering, re-conductoring, etc.
Massive electrification to rural mass under RGGVY is further increasing T&D loss / AT&C loss in absence of methodology to establish base line data collection system and to capture AT&C losses in different areas to control the same as envisaged under Restructured Accelerated Power Development and Reform Programme (R-APDRP).
The Govt. of India through the Restructured Accelerated Power Development and Reform Programme (R-APDRP) has now initiated action for providing financial help to SEBs for preparation of base line data with regard to identification of area of losses and also for renovation, modernization and strengthening of 11 KV level sub-station, transformer / transformer centre, reconductoring of lines at 11 KV level and below, load bifurcation, feeder separation, load balancing, HVDC (11 KV), aerial bunching conducting in dense areas, replacement of electro-magnetic energy meters with tamper proof electronic meters, installation of capacitor bank and mobile service centre, etc. The Board may expect substantial reduction in T&D/AT&C loss only after completion of the aforesaid scheme.
6.19.5 The Board has also submitted that it is making all efforts to control/ reduce the T&D losses in the State, however, the losses during 2009-10 and 2010-11 could not be reduced to the target level fixed by the Commission mainly due to massive addition of network in rural areas, addition of subsidized rural/Kutir Jyoti connections and lack of availability of funds for undertaking loss reduction works envisaged by BSEB. The Commission is requested that the T&D targets for FY 2011-12 & FY 2012-13 as proposed in this petition be accordingly approved. 6.19.6 In view of the above submissions, the Board has prayed to the Commission to approve the T&D loss levels for FY 2011-12 at 42% & FY 2012-13 at 41% in consideration of the existing T&D loss levels of BSEB. The T&D losses of the
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previous years as approved by the Commission, actual as per accounts and the projections for FY 2011-12 (RE) and FY 2012-13 are as shown in the table below:
Table 104: T&D Losses of BSEB for previous years and projections
Financial Year/ T&D Loss (%)
Approved by Commission
Actual as per Annual Accounts
FY 2006-07 FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11

Financial Year/ T&D Loss (%)
41.40% 38.00% 38.00% 35.00% 32.00%

Approved by Commission 29.00% 27.50%
42.61% 39.06% 37.98% 38.32% 43.59%

Projected 42.00% 41.00%
FY 2011-12 FY 2012-13
6.19.7 BSEB has also prayed to the Commission for revision of the existing consumption norms for Kutir Jyoti (Rural Unmetered) and IAS-I to 30 units per connection per month and 2000 units per KW per annum respectively. Commissions analysis 6.19.8 The Commission in its Tariff Order for FY 2006-07 approved the T&D loss target for the Board till FY 2008-09. Later on the Commission in its Tariff Order for FY 2008-09 relaxed the loss target for FY 2008-09 to 38% from the previous set target of 34% because of non-achievement of loss target by the Board. Further the Commission fixed the T&D loss trajectory till FY 2013-14 for the Board in its subsequent Tariff Orders.
Table 105: T&D loss target Vs. Achievement by BSEB
Year FY 2006-07 FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11 FY 2011-12
T&D Loss targets set by BERC 41.4% 38.0% 34.0%* -
Approved by BERC in respective TO 38.0% 35.0% 32.0% 29.0%
T&D Loss proposed by BSEB 36.0% 41.4% 40.5% 35.0% 38.0% 36.0% (Revised estimate - 42% as per FY 201213 petition)
As per Annual Accounts of the BSEB 42.61% 39.06% 37.98% 38.32% 43.59% -
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FY 2012-13 FY 2013-14
27.5% 26.0%
41.0% -
* Later on for FY 2008-09 T&D loss target was revised to 38% in TO for FY 2008-09
6.19.9 It has been observed that the Board has not been able to meet the loss reduction target set by the Commission in the past. The audited accounts of the Board are also reflecting the increasing trend of T&D loss during the past two years. The other factor worth noting here is that the Board in lieu of reducing the T&D loss is proposing higher loss level for FY 2011-12. The Board had projected T&D loss of 36% for FY 2011-12 in its tariff petition for FY 2011-12, whereas now the Board in its revised estimate is proposing T&D loss of 42% for FY 2011-12 and 41% FY 2012-13. The T&D loss level projected by the Board for FY 2011-12 in the revised estimate (42%) is even more than the actual loss level of the Board for the FY 2006-07. In the above scenario, the Commission is of the view that the loss reduction initiatives taken by the Board during the past six (6) years is a big question mark in itself. 6.19.10 The Boards logic behind increasing trend of T&D in the state of Bihar on account of huge electrification in rural areas under scheme such as RGGVY is not justifiable as most of the states in India has availed such schemes although their loss level has improved/ improving trend unlike BSEB. This is also to be noted that there are other central Govt. sponsored schemes such as APDRP, R-APDRP and strengthing of transmission netwokk under Rastruiya Sam Vikas Yojana (RSVY) which are targeted for strengthing of transmission and distribution network of the Board wherein the impact of investment through Govt. grant should have reduced the overall T&D loss of the Board during the past six (6) years. In addition, the State Government is also providing plan funds for 100% metering and replacement of old conductors. All these schemes should help BSEB to reduce T&D rather than increase T&D loss. Hence, rural electrification cannot be held responsible for high T&D loss in Bihar where funds are flowing for network and distribution system improvement through Central Government and multilateral funding agencies such as ADB, PFC etc. 6.19.11 Keeping in view the current state of affair of the Board in terms of initiative and outcome of T&D loss reduction strategy vis--vis the Boards proposal of increasing T&D loss, the Boards approach of diverting Government grant towards meeting financial losses of the Board on account of higher T&D loss will only encourage the Board to give least priority to loss reduction initiative in future and shall put
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unnecessary burden on the State Government as well as Consumers at large in the State of Bihar through unjustifiable tariff hike, due to inefficiencies of the Board. 6.19.12 It is a well-accepted principle that T&D losses are a controllable parameter and the Commission has rightly set trajectory for it. BSEB is responsible for consequences arising out of non-achievement of target of controllable parameter. It is the responsibility of BSEB to take appropriate measures to bring down losses within the trajectory approved by the Commission. BSEB now cannot pray before the Commission to pass on the impact of non-achievement of the loss trajectory to consumers. The Commission has been approving the capital expenditure proposed by BSEB in its tariff petitions with an expectation that the promised operating efficiencies would be achieved by BSEB. BSEB has already spent significant amount of money on capital expenditure through APDRP, RGGVY, RSVY and state plan without any perceptible gain in terms of loss reduction. 6.19.13 The Electricity Act 2003 was amended in 2007 to strengthen the mechanism and empower distribution utilities to take effective steps to improve efficiency and curb theft and losses. Therefore, BSEB cannot express its inability to curb theft and T&D losses. The Commission having set the loss trajectory and also revised it once in its earlier Tariff Order does not find any justification to go for another revision. The Commission believes that the consumers of the state should not suffer on account of inefficient performance of BSEB. 6.19.14 So far as the proposal of BSEB for revising the existing consumption norms of 18 units per month for Kutir Jyoti (Rural Unmetered) consumers and the existing consumption norm of 1485 units per kW per annum for IAS-I consumers is concerned, BSEB has not conducted any credible study with appropriate sample size to support the claim of increased norms. The Commission has got the survey and study conducted of reasonable number of Kutir Jyoti (Rural) and IAS I consumers to ascertain the average consumption of these consumers. The study supports the consumption norms approved by the Commission for Kutir Jyoti (Rural) and IAS I consumers. Therefore, The Commission considers and approves T&D losses at 27.5% for the FY 2012-13 and sets T&D loss trajectory of 26.0% for FY 2013-14 and 24.5% for FY 2014-15. The Commission also approves the consumption norms of 18 units per month for Kutir Jyoti (Rural - unmetered) and 1485 units per kW per annum for IAS I consumers.
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6.20
BSEBs Own generation Petitioners submission
6.20.1 BSEB owns and operated only one thermal generating plant i.e. Barauni Thermal Power Station (BTPS) located at Barauni. The total installed capacity of the BTPS in FY 2010-11 was 320 MW. The current status of all units of BTPS is summarized in the table below for reference:
Table 106 : Current Status of different units of BTPS
Unit I II III IV V VI VII
Unit capacity Date of (MW) Commissioning

Retired Retired Retired 50 50 110 110 N/A N/A N/A 9/11/1969 1/12/1971 1/12/1984 31/03/1985
Current status
Retired since 17.02.1983 Retired since 26.11.1985 Retired since 05.10.1985 Shutdown since 24.04.1996 Shutdown since 15.03.1995 Unit working at de-rated capacity; Dismantling of the Unit and its R&M work is planned from Jul12 Under shutdown; R&M is underway; Expected to come in operation from Jul12
6.20.2 The Board has also submitted that, Units I, II and III were retired long back i.e. before 1985. Out of the remaining four units, unit number IV and V are over 42 and 40 years old respectively and have completed their useful economic life. These Units are under shutdown for over 17 years. At present Unit VII is under shutdown and undergoing Renovation & Modernization work for revival. Dismantling of the Unit VI for R&M work is planned from July 2012 while R&M of Unit VII is expected to be completed by June 2012. 6.20.3 During FY 2012-13, Unit VI will be taken out for R&M while R&M of Unit VII will be completed. After R&M, unit will be under stabilization period and hence higher specific oil consumption is requested for BTPS plant. Station heat rate is expected to improve from FY 2010-11 level of 4103 kCal/kWh to 4000 kCal/kWh & 3700 kCal/kWh for FY 2011-12 & FY 2012-13 respectively. The Board has submitted that the coal price in FY 2010-11 was Rs. 1823 per MT but in recent time it has witnessed steep hike and has reached the level of Rs. 3317 per MT in month of August, 2011. Hence coal price for FY 2011-12 & FY 2012-13 is expected to be on higher side from the level of FY 2010-11. Other fuel related cost is projected in the ratio of other fuel related cost to fuel cost in line with FY 2010-11.
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6.20.4 The assumptions and norms used by BSEB for projection of own generation cost is summarized in the table below:
Table 107: Proposed Plant parameters & Fuel cost determinants for BTPS Parameters Gross Units Generated Auxiliary Consumption Net Generation Capacity Derated Capacity Plant Load Factor Auxiliary Consumption Station Heat Rate Sp. Oil Consumption Gross Calorific Value of Coal Calorific Value of Oil Overall Heat Heat from Oil Heat from Coal Transit losses Actual Oil Consumption Actual Coal Consumption Specific Coal Consumption Price of Coal Price of Oil Coal Cost Oil Cost Fuel Cost Other Fuel Related costs Total Fuel Costs Total Fuel Cost/Gross Generation Total Fuel Cost/Net Generation Units MU MUs MUs MW MW % % kcal/kWh ml/kWh kcal/kg kcal/l G Cal G Cal G Cal % kl MT kg/kWh Rs./MT Rs/kl Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs/unit Rs/unit FY 2010-11 (Actual) 220.44 39.56 180.88 220 220 11.44 17.95 4,103 31.48 3,858 9,950 904,534 69,046 835,488 6,939 216,560 0.98 1,823 31,388 39.48 21.78 61.26 5.06 66.32 2.78 3.39 FY 2011-12 (RE) 202.00 30.30 171.70 220 220 10.45 15.00 4,000 35.00 3,800 9,996 808,009 70,671 737,337 7,070 194,036 0.96 2,600 50,780 50.45 35.90 86.35 7.13 93.48 4.63 5.44 FY 2012-13 (Projection) 310.00 37.20 272.80 220 220 16.09 12.00 3,700 30.00 3,700 9,996 1,146,999 92,961 1,054,038 9,300 284,875 0.92 3,250 57,504 92.58 53.48 146.06 12.06 158.13 5.10 5.80
6.20.5 BSEB revises its estimate of fuel cost for FY 2011-12 to Rs. 93.48 Cr. against Rs. 80.46 Cr. as approved by the Commission. The Commission is requested to approve the fuel cost of Rs. 158.13 for FY 2012-13 for generation of 310 MU from BSEBs own generating plant. 6.20.6 The Commission vide letter No. BERC- Tariff 24/11- 825 dated 21st December, 2011 enquired about the generation related data and information of BTPS Barauni such as actual generation, performance parameters, month wise projected generation and performance parameters, reasons of non-achievement of performance parameters during FY 2010-11 and FY 2011-12 (upto Nov11) despite investment under R&M head etc. The Commission also sought clarification on the
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high generation cost of power from BTPS despite investment on R&M, actual coal Transit loss and the basis for steep hike proposed for FY 2011-12 (RE) and FY 201213 (Projected) in Coal and Oil price. 6.20.7 In response to this the BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 informed the Commission that during FY 2012-13, unit 6 will be under operation for April and May and then it will undergo R&M work, while unit 7 will start generating power from month of July. The BSEB has submitted the month-wise projected power generation for FY 2012-13 as below:
Table 108: Month wise projected power generation from BTPS for FY 2012-13
Month April May June July August September October November December January February March
Generation (MU) 10 10 5 20 30 35 40 40 40 40 40
PLF (%) 13.23 12.80 6.11 24.44 37.88 42.77 50.51 48.88 48.88 54.11 48.88
Auxiliary consumption (MU) 1.750 1.750 1.00 3.00 3.60 4.20 4.75 4.75 4.75 4.75 4.75
SHR (kcal/kg) 3750 3750 3500 3300 3200 3200 3000 3000 3000 3000 3000
Specific oil consumption (ml/kwh) 30 30 50 40 30 30 15 15 15 15 15
GCV of coal (kcal/ kg) 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500 3500
6.20.8 On non-achievement of performance parameters during FY 2010-11 & FY 2011-12 (upto December 2011), the BSEB has submitted that it is due to non-completion of R&M work of unit VII. Unit VI is in operation after restoration since July 2007. As per schedule norms, its capital maintenance is now due. The R&M of unit VI will start after completion of R&M work of unit. VII. 6.20.9 Further, BSEB has submitted that Unit VI of BTPS will goes for R&M in June, 2012 and Unit VII will come in operation after R&M in July, 2012. Unit VII will be in stabilisation period and hence the operational parameters will be on higher side. The main reason for such high fuel cost is cost of coal and cost of oil which has increased substantially in recent period.
Table 109: Fuel cost trend submitted by BSEB
Sl.
Financial Year
Coal Price/MT (in Rs.)
Oil Price/Kl (in Rs.)
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Sl. 1 2 3
Financial Year 2008-09 2009-10 2010-11
Coal Price/MT (in Rs.) 1221.27 1701.00 1822.92
Oil Price/Kl (in Rs.) LDO 36915.33 43808.72 51369.98 FO 29260.59 26896.00 30037.70
6.20.10 BSEB has informed the Commission that the Board do not have weighing machine in working condition at their power plant and hence it is not possible to know actual coal transit loss. In such scenario, coal transit loss is projected at 0% for FY 2011-12 & FY 2012-13. Commissions analysis 6.20.11 On analysis of details it was observed that BSEB has projected the GCV of 3700 kCal/kg for FY 2012-13 in its tariff petition whereas in the additional information vide BSEB letter No Com/Tar/161/2011-260 dated 09th February, 2012, the Board has projected GCV of 3500 kCal/ kg, whereas price of coal has increased, and value of GCV lowered by 200kCal/kg, without stating any reason thereof. Similarly, the operating parameter such as Auxiliary consumption, SHR etc. is also having deviation w.r.t. ARR and tariff petition for FY 2012-13. 6.20.12 During the data validation process, it also came to the notice of the Commission that the capacities of the Unit VI & Unit VII of BTPS have been de-rated. The capacity of each unit is now 105 MW instead of 110 MW as submitted by BSEB. The Commission was also informed that the BTPS do not have weighing machine in working condition and hence they are not computing the actual coal transit loss. In this regard the Commission directs the Board to expedite the work of installing and commissioning of Weight-Bridge at all the generating stations and submit progress report to the Commission. The Board is also directed to intimate the Commission about the actual transit loss of coal with their FPPCA petition monthly. 6.20.13 In the Tariff Order for FY 2011-12, auxiliary consumption for BTPS was approved at 10% and the Commission decides to retain the same norm for FY 2012-13. The specific oil consumption of BTPS is 30 ml/kWh which is too high. This issue has already been settled in the previous Tariff Order. The Commission decides to retain the same norm for FY2012-13. The Commission approves specific oil consumption of 10 ml/kWh.
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6.20.14 The Commission approves GCV of coal based on average of actual GCV of coal for FY 2009-10 and FY 2010-11. For SHR , price of coal and price of oil the Commission approves the values as submitted by the Petitioner keeping in mind the age of the plant and current price trend of coal. 6.20.15 Based on the above parameters, the cost of generation of BTPS as determined by the Commission for FY 2012-13 is given below:
Table 110: Approved Plant parameters of BTPS & fuel cost determinants for FY 2012-13
Parameters Gross Units Generated Auxiliary Consumption Net Generation Capacity Derated Capacity Plant Load Factor Auxiliary Consumption Station Heat Rate Sp. Oil Consumption Gross Calorific Value of Coal Calorific Value of Oil Overall Heat Heat from Oil Heat from Coal Transit losses Actual Oil Consumption Actual Coal Consumption Specific Coal Consumption Price of Coal Price of Oil Coal Cost Oil Cost Fuel Cost Other Fuel Related costs Total Fuel Costs Total Fuel Cost/Gross Generation
Units MU MUs MUs MW MW % % kcal/kWh ml/kWh kcal/kg kcal/l G Cal G Cal G Cal % kl MT kg/kWh Rs./MT Rs/kl Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs. Cr. Rs/unit
FY 2012-13 (Projection) 310.00 37.20 272.80 220 220 16.09 12.00 3,700 30.00 3,700 9,996 1,146,999 92,961 1,054,038 9,300 284,875 0.92 3,250 57,504 92.58 53.48 146.06 12.06 158.13 5.10
FY 2012-13 (Approved) 310.00 31.00 279.00 220 210 16.85 10.00 3,700 10.00 3,969 10,000 1,147,000 31,000 1,116,000 3,100 281,215 0.91 2,857 48,761 80.34 15.12 95.46 8.06 103.52 3.34
6.20.16 The Commission approves the fuel cost for BSEBs own generation at Rs. 103.52 Cr. for FY 2012-13 for gross generation of 310 MU.
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6.21
Power Purchase Petitioners submission
6.21.1 BSEB has projected the power purchase costs at Rs.5139 Crs including PGCIL charges for purchase of 14,142 MU for FY 2012-13. 6.21.2 BSEB has submitted that it has firm allocations of power from thermal power plants of NTPC, Hydel Power Plants of NHPC, and the hydel plants of Chukka & Tala through PTC, hydel plants of BSHPC and thermal power plant of Kanti BUNL. In addition to these, BSEB will also purchase power from co-generation by sugar mills, Nepal, Short-term/ Medium-term and Renewable sources. BSEB has projected energy availability for FY 2012-13 from BSHPC, Sugar Mills, Nepal and KBUNL based on the energy drawl from April2011 to August 2011 as there is no capacity addition projected from these plants during FY 2012-13. 6.21.3 The Board in its petition has also intimated that it has started procuring 300 MW short-term power purchase through NVVNL from September 2011 at the rate of Rs. 4.09 per kWh. BSEB is planning to sign medium-term contract with NVVNL for 450 MW from April 2012 at the rate of Rs. 4.31 per kWh. Considering the 85% of availability, energy available during FY 2011-12 & FY 2012-13 is projected at the level of 1304 MU and 3351 MU respectively from short term and medium term purchase. 6.21.4 Based on the above, the projected energy availability of BSEB from the long term sources is summarized in the table below:
Table 111: Power Purchase Cost Projected by the Petitioner for FY 2012-13
Station NTPC Farakka Talchar Kahalgaon KBUNL NHPC Rangit Teesta PTC Chukka
Allocated Capacity (MW) 466 398 439 110
Units available (MU) 2,889 2,449 2,670 321
Per unit cost ( Rs/ kWh) 4.36 2.84 3.63 3.65
Total Cost (Rs Cr.) 1,260 696 969 117
21 109
119 549
1.54 1.28
18 70
80
543
1.53
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Station Tala Others NEA BSHPC NSSM Short/Medium Term RE Purchase Solar Other renewable PGCIL Charges Total
Allocated Capacity (MW) 260
Units available (MU) 909
Per unit cost ( Rs/ kWh) 1.78
Total Cost (Rs Cr.) 162
50 18 450
4 30 29 3,351 3 275
4.41 2.49 3.35 4.31 15.00 3.90
2 8 10 1,444 4 107 190 5,139
14,142
3.63
6.21.5 In response to the Commission query regarding new allocation from Central Generating Station (CGS) or any upcoming generating station planned to be commissioned during FY 2011-12 or FY 2012-13 vide Commissions letter No. BERC- Tariff 24/11- 825 dated 21st December, 2011, the BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 informed the Commission that BSEB has allocation of 50 MW from Farakka stage-III power plant of NTPC. It was expected that power will be available from Farakka stage-III plant in FY 2011-12 but due to fuel related issues currently there is no power availability to BSEB from the plant. Apart from Farakka stage-III, there is no other Central sector allocation which is expected to come up in FY 2011-12 & FY 2012-13. Hence, BSEB has not projected any increase in power purchase allocation from the central sector generating stations. 6.21.6 The Commission vide letter No. BERC- Tariff 24/11- 825 dated 21st December, 2011 asked BSEB to provide actual cost data of power purchased during FY 201112. BSEB provided the power purchase quantum and cost data for FY 2011-12 vide letter No Com/Tar/161/2011-260 dated 09th February, 2012. The information provided by BSEB has been used by the Commission for projecting power purchase quantum and cost for FY 2012-13. 6.21.7 BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 submitted the Commission that there is typing mistake in writing methodology for projection of power from Farakka, Talchar and Kahalgaon. BSEB has stated that it has been projected based on the actual generation of April, 2011 to August, 2011 on pro-rate basis.
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6.21.8 Further, BSEB vide letter No Com/Tar/132/2011-375 dated 1st March, 2012 explained the basis of considering the power purchase rate of Rs 4.09/ kwh and Rs 4.31/ kWh for short/medium term power purchase. On short-term and medium-term power purchase rate BSEB has clarified as below: Short term: BSEB vide NIT no. 171/PR/BSEB/2011 had invited bid for procurement of 300 MW power under short term for the period 1st December 2011 to 29th February 2012. In response to the said NIT only two bids from NVVNL and PTC were received. After evaluation of the bids of M/s NVVNL and M/s PTC, NVVNL was the L1 bidder who quoted tariff Rs. 4.416 per kwh at delivery point of BSEB within Bihar periphery (based on billing as per REA) for supply of 300 MW power for the entire period of contract. The matter was discussed in the CPC meeting no. 14/2011 held on 04.11.2011. CPC had recommended negotiation of rate with NVVNL for suplly of power for the entire contract period. In compliance of the direction of the CPC, meeting with the representative of NVVNL and BSEB were held on 05.11.2011. After negotiation NVVNL agreed to supply 300 MW power under short term for the period 1st December 2011 to 29th February 2012. Subsequently, Board vide resolution no. 8632 in the 542nd Meeting held on 08.11.2011 approved the procurement of power from L1 bidder M/s NVVNL at agreed rate of Rs. 4.31 per KWh at the delivery point of BSEB within Bihar Periphery for the period from 1st December 2011 to 29th February 2012. LoI was issued by BSEB vide letter no 568 dated 26.11.2011 to NVVNL for supply of 300 MW power under short term at agreed rate Rs. 4.31per kwh. Energy Department, Govt. of Bihar vide its letter no. 81 dated 10.01.2012 has also accorded approval for reimbursement of the financial loss to be incurred by BSEB on account of the procurement of 300 MW power under short term. 6.21.9 On the issue of steps taken by BSEB for the compliance of the Renewable Purchase Obligation, the BSEB vide letter No Com/Tar/132/2011-375 dated 1st March, 2012 informed the Commission that BSEB has signed Power Purchase Agreement with a no. of developers for procurement of power through renewable energy based generation. The list of the developers and the present status of operation of the plant as submitted by BSEB are indicated below.
Table 112: Executed PPA with developer for power based on renewable energy
Name of the Project Developer (Capacity in MW) A. Bagasse based Cogeneration Plant
Location of the Project
Contracted capacity in MW/ MUs (Season/off season)
Present Status
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TARIFF ORDER FOR FY 2012-13 Contracted capacity in MW/ MUs (Season/off season) 5 / 8 MW 10 / 13 MW 11 MW 13 / 16 MW 13 / 16 MW 14.54 / 18.05 MW
Name of the Project Developer (Capacity in MW)
Location of the Project Narkatiaganj, West Champaran Sidhiwalia, Gopalganj Harinagar, West Champaran Sugauli Lauria Marhourah, Saran
Present Status
New Swadeshi Sugar Mills (10 MW) Bharat Sugar Mills (18 MW) Harinagar Sugar Mills Ltd. (14.5 MW) HPCL Biofuels Ltd. (20 MW) HPCL Biofuels Ltd. (20 MW) HV Distelleries & Sugar Mills Ltd. (25 MW) B. Biomass based Generation Plant Vishnu Vishal Paper Mills (2 MW) C. Solar PV based generation Plant
In Operation In Operation In Operation In Operation In Operation Yet to be Commissioned Yet to be Commissioned Consent letter given by BSEB for procurement of entire power 4.94 MUs offered by developer. Solar PV/Solar Thermal PPA is uploaded on the BSEB web site. Project developer has been requested to sign PPA. Project is expected to be commissioned in 2012-13.
1 MW
Glatt Solution Pvt. Ltd., Kolkata (3 MW)
Nawada
3 MW, 4.94 MUs
6.21.10 In addition to the above, BSEB has also informed the Commission that they have received various proposals for establishment of generation plants based on renewable energy sources and their status is mentioned in the table below. BSEB shall purchase power from these projects as per its Renewable Purchase Obligation fixed by Honble BERC and also under solar purchase obligation which is 0.25 % up to FY 2012-13 and goes up to 3 % by the FY 2021-22. BSEB has also filed a petition before BERC vide letter no. 349 dated 21.02.2012 in respect of the procurement of power from Solar Energy Sources.
Table 113: Proposals received for setting-up renewable energy plants
Name of the Location of Capacity Project the Project (In MW) Developer A. Biomass based Generation Project Kumar TechKhizirsarai 6 MW
Present Status
Feasibility report for connectivity with Page 183
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Location of the Project road, Gaya
Capacity (In MW)
Present Status BSEBsystem through 11 KV Gere Dehati feeder at 33/11 KV PSS at Magadh Engg. College, Gaya has been obtained from ESE / Supply, Gaya. Recommendation of BREDA is still pending.
Emergent Venture India Pvt. Ltd, Gurgaon
1 X 12 MW plant proposed at 11 different places in Bihar. Out of which 1 X 12 MW is proposed at Churi village, Gaya sadar.
12 MW
Feasibility report for connectivity with 132/33 KV Grid S/s, Chandauti through 132 KV transmission line has been obtained from ESE, Transmission Circle, Gaya and also conveyed to EVI, Gurgaon vide BSEB letter no. 355 dated 17.02.2011. The recommendation of BREDA is awaited.
PTC-BERMACO Green Energy System Ltd., Navi Mumbai
26 places in different district of Bihar.
12 MW
Feasibility report for connectivity of 1 X 12 MW Biomass based generating plant at Gaunaha, West Champaran with 132/33 KV Grid S/s at Ramnagar has been obtained. BREDA vide its letter Memo no. 184 dated 06.02.2012 has given direction to BSEB to take appropriate action for signing of the PPA. In this regard, BSEB vide its letter no. 335 dated 20.02.2012 has also requested PTC-BERMACO to submit necessary approvals for signing of the PPA. Feasibility report for connectivity of the plant at 33 KV with 132/33 KV Grid S/s, Nawada had already been obtained. BREDA vide its letter no. 647 dated 28.06.2012 has given recommendation letter to BSEB for signing of the PPA with M/s Glatt Solution Pvt. Ltd. BSEB vide its letter no. 344 dated 21.02.2012 has requested the project developer to intimate convenient date for signing of the PPA and submit requisite approvals/clearances & Performance guarantee as per PPA. The project is expected to be commissioned during 201213. Recommendation of BREDA is awaited. The developer has not identified the location for installation of project in Muzaffarpur. SIPB approval for the project has been obtained.
B. Solar PV Power Plant
Glatt Solution Pvt. Ltd., Kolkata
Nawada
3 MW (4.94 MU / year to be supplied to BSEB)
Bhilwara Energy Limited, Noida
Muzaffarour
CLARO, New Delhi
Gopalganj & Khagaria
CHAUCER CAPITAL,
Barachatti, Bodhgaya
10 MW (offered to supply 16 MUs / year power to BSEB) 1 X 5 MW each (Offered to supply 7.5 MU/year power to BSEB from each project) 20 MW (offered to
SIPB approval obtained. Recommendation of BREDA is awaited.
SIPB approval obtained. Feasibility report for connectivity with BSEB 220/132/33 KV Grid S/s
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Location of the Project
Capacity (In MW) supply 36.278 MU/year power to BSEB)
Present Status at Bodhgaya at 33 KV has been given by ESE / trans. Circle, Gaya. Recommendation of BREDA.
Avant Garde Re-Energy Limited, Kolkata
Bhojpur, Saran, Bhabua
10 MW each
SIPB approval obtained vide Dept. of Industry, Govt. of Bihar letter no. 1307 dated 15.09.2010. Project developer has not yet submitted recommendation of BREDA. Project developer has also not submitted letter with full details to BSEB to examine the technical feasibility for connectivity of the project with BSEB Grid S/s or PSS. BSEB vide its letter no. 561 dated 02.04.2010 had requested the developer to provide certain information like exact location of the plant, tentative distance of the plant from near by Grid S/s of BSEB to examine feasibility for connectivity with the BSEB system under JNNSM scheme. The response of the project developer is still awaited. The project developer has also not submitted any information regarding selection of the project under JNNSM scheme and registration from BREDA.
C. Solar PV project under JNNSM scheme
Abacus Holding Private Limited, Kolkata
Purnea, Bhagalpur, Muzaffarpur, & Gaya
5 MW each
Commissions analysis 6.21.11 The Commission considers power purchase from Farakka, Talchar and Kahalgaon plants of NTPC and from KBUNL, after scrutiny of data and updated bills. The Commission also finds generation projected by BSEB from other remaining plants as reasonable and approves the same for FY 2012-13. 6.21.12 For determining per unit cost of generation for FY 2012-13, the Commission has considered the actual per unit cost for FY 2011-12 (for the period of April, 2011 to August, 2011) as submitted by the BSEB. The charges for usage of interstate transmission system for FY2012-13 has been projected on the basis of actual of FY 2011-12 (for the period of April, 2011 to August, 2011) and the quantum of power that are likely to be transmitted during FY 2012-13. 6.21.13 The revised tariff for Rangit and Teesta HEPs of NHPC as approved by the CERC for the period FY 2008-09 to FY 2013-14 and made available to the BERC along with FPPCA petitions has been considered in place of the rates proposed in the ARR/ tariff petition by the BSEB. It may be noted that the Commission intends to approve
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the power purchase costs appropriately for the ensuing year so as to minimize any subsequent charging of the same under FPPCA. 6.21.14 For renewable solar purchase, average of forbearance and floor price have been considered for computing the generation cost and accordingly Rs. 15 per unit has been considered. For determining purchase cost from other renewable sources same methodology has been employed and accordingly price of Rs. 3.90 has been considered by the Commission. 6.21.15 Plant-wise expected power purchase quantum and its total cost for FY 2012-13 as approved by the Commission are given below:
Table 114: Approved Power Purchase Cost for FY 2012-13
Station
Units available (MU)

Projected by BSEB Approved by Commission

Total Cost (Rs Cr.)

NTPC Farakka Talchar Kahalgaon KBUNL NHPC Rangit Teesta PTC Chukka Tala Others NEA BSHPC NSSM Short/Medium Term RE Purchase Solar Other renewable PGCIL Charges Total
2,889 2,449 2,670 321
2,889 2,449 2,670 321
4.36 2.84 3.63 3.65
4.36 2.84 3.63 3.65
1,260 696 969 117
1,258 694 968 117
119 549
119 549
1.54 1.28
2.60 2.04
18 70
27 111
543 909
543 909
1.53 1.78
1.53 1.78
83 162
83 161
4 30 29 3,351 3 275
4 30 29 3,351 3 275
4.41 2.49 3.35 4.31 15.00 3.90
4.41 2.49 3.35 4.31 15.00 3.90
2 8 10 1,444 4 107 190 5,139
2 8 10 1,442 4 107 190 5,182
14,142
14,142
3.63
3.67
6.21.16 The Commission approves the power purchase cost at Rs. 5182 Cr. for purchase of 14,142 MUs for FY 2012-13.
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6.22
6.22.1 Energy balance depicts the balance between total energy sales and T&D losses (i.e.) energy requirement and energy available from own generation and power purchased from various generating sources. 6.22.2 BSEB has projected inter-state transmission losses of 3.31% with a justification that it is the actual central sector eastern region transmission losses. Further, BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 explained that the Energy balance has been worked out based on the same methodology as adopted by the Commission in its Tariff Order for FY 2011-12. For power availability, own generation and net power purchase is taken into consideration. For power requirement, sale to consumer, additional power sale to consumer, sale to Nepal and sale through Bilateral/UI has been considered. T&D losses are applied on sale to consumers of Bihar and Sale to Nepal only and not applied on the sale under bilateral/UI while projecting for FY 2012-13. BSEB in the additional information vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 also informed the Commission that Board sell power to Nepal Electricity Authority at 132 kV & 33 kV and sale under UI is done at 220 KV voltage level. Board does not sell any power under bilateral trade. 6.22.3 The projected gross energy requirement, energy availability and additional power purchase required because of actual and approved losses for BSEB for FY 2012-13 is as follows:
Table 115: Proposed Energy Requirement & Energy Balance
Particulars Energy Sales within State Sale from additional Power Availability Energy outside State (Nepal) Sale in biteleral trade/UI Total Sales T&D Losses T&D Losses Energy Requirement Energy Availability
Unit MU MU MU MU MU MU % MU MU
FY 2012-13 (As per BERC approved loss trajectory) 7,313 266 555 293 8,427 3,085 28% 11,512
FY 2012-13 (As per BSEB Loss Projection) 7,313 266 555 293 8,427 5,652 41.00% 14,079
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TARIFF ORDER FOR FY 2012-13 FY 2012-13 (As per BERC approved loss trajectory) 273 14142 3.31% 335 14,079.00 2,567
Particulars Own Generation Total Power Purchase from long term sources Transmission loss in regional losses Transmission loss in regional losses Net Power Availability Disallowable Power Purchase
Unit MU MU % MU MU MU
FY 2012-13 (As per BSEB Loss Projection) 273 14,142 3.31% 335 14,079 -
6.22.4 BSEB has further submitted that for FY 2011-12 & FY 2012-13, BSEB projects to under-achieve the T&D loss reduction as compared to the T&D loss trajectory approved by the Commission hence BSEB is required to purchase additional power of 2101 MUs for FY 2011-12 and 2567 MUs for FY 2012-13 as indicated in Energy Balance. Based on the net power purchase rate, additional power purchase cost works out to Rs. 754.26 Cr. and Rs. 955.74 Cr. for FY 2011-12 & FY 2012-13 respectively. Board has requested the Commission to reduce resource gap funding to the extent of such disallowances and only remaining amount need to be considered as subsidy available for consumers. Commissions analysis 6.22.5 The Commission approves the limits for energy requirement and energy availability as given below for the FY 2012-13. Commission while approving the energy balance considered the inter-state transmission losses based on average of past three years an approved loss which is 2.51%:
Table 116: Approved Energy Requirement for FY 2012-13 (in MU)
Particulars Energy Sales within State Sale from additional Power Availability Energy outside State (Nepal) Sale in bi-lateral trade/UI Total Sales T&D Losses T&D Losses Energy Requirement Energy Availability Own Generation
Unit MU MU MU MU MU MU % MU MU MU
FY 2012-13 (As per BERC approved Loss Approved) 7,313 266 555 293 8,427 3,085 27.50 11,512
FY 2012-13 (Approved by BERC) 7,512 266 555 293 8,626 3,161 27.50 11,786
273
279
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TARIFF ORDER FOR FY 2012-13 FY 2012-13 (As per BERC approved Loss Approved) 14142 3.31 335 14,079 2,567
Particulars Total Power Purchase from long term sources Transmission loss in regional losses Transmission loss in regional losses Net Power Availability Disallowable Power Purchase
Unit MU % MU MU MU
FY 2012-13 (Approved by BERC) 11,804 2.51 296 11,786 2,338
6.23
Operation & Maintenance Expenses (O&M) Employee Expenses Petitioners submission
6.23.1 The employee cost comprises salaries and wages, dearness and other allowances, pension, gratuity and staff welfare expenses etc. 6.23.2 BSEB submitted that they are calculating the terminal liabilities on provisional basis and hence the amount of terminal benefits/retiral dues payable to the retired employees is not treated as expenditure for the year. The amount actually paid is adjusted against the provision made in the books of account for pension, gratuity and leave encashment. BSEB has also submitted that, in view of the severe financial crunch mainly on account of Tariff lower than Average cost of supply, BSEB has not been able to maintain separate fund for retiral liabilities as per the provisions made in the Annual Accounts hence, there has been a practice by BSEB to meet such unfunded liability out of the revenue realized from sale of energy during the period of incidence of discharge of such liabilities. 6.23.3 BSEB has accordingly submitted that the total expenditure under the head of employee costs is 593.9 Cr. as per the annual accounts for FY 2010-11 and Rs. 168.99 Cr. paid to its retired employees as unfunded terminal liabilities in FY 201011. 6.23.4 For projection of employee cost for FY 2012-13, BSEB has considered that the employee expenses will increase by 10% in FY 2011-12 & FY 2012-13 from level of FY 2010-11. 6.23.5 BSEB has also projected additional cost of Rs. 11.07 Cr. for new employees in FY 2011-12 and Rs. 32.62 Cr. for FY 2012-13.
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6.23.6 On the issue of payment against terminal liablility and creation of trust for employee fund, BSEB vide letter No Com/Tar/132/2011-375 dated 1st March, 2012 informed the Commission that an additional payout of Rs. 130.28 Cr. was made on account of staff related liabilities & provisions as indicated in the schedule 28 on account of unfunded terminal liabilities in FY 2010-11 & Rs. 42.11 Cr. was also paid as interest on GSS, GPF and other staff deposits made on account of unfunded terminal liabilities in FY 2010-11 as indicated in the schedule 12 of the annual accounts. 6.23.7 The BSEB, as additional information, has also submitted break-up of Rs. 21,91,35,96,307 & Rs. 20,61,07,70,574 shown under Staff related liabilities and provisions in annual accounts of FY 2010-11 as below:
Particular GPF CPS Pension scheme Group saving scheme Provision for garduity Provision for leave encashment Provision for pension RPF Commissioner Others Total As on 31.03.2010 5,195,223,312 24,328,113 772,069,528 2,433,955,673 1,312,803,309 10,414,731,139 2,930,236 1,763,415,469 21,919,456,779 As on 31.03.2011 5,237,987,358 62,275,478 784,117,511 2,277,524,606 1,305,341,732 9,138,199,802 2,930,236 1,842,299,625 20,650,676,348
6.23.8 On the matter of allocation of terminal benefit and head of expenditure during past years, the Board has submitted that it has been deducting contribution towards GPF and GSS from the salary of its employees. So far as the other heads of terminal benefits such as pension, gratuity and leave encashment are concerned. BSEB has also mentioned that the Board has been providing for such liabilities in the Accounts to exhibit the same on accrual basis without keeping fund in any separate account to the extent of such provision. As regards the allocation of deducted fund under GPF and GSS, It may be clarified that the Board has always remain in cash deficit due to lower tariff much below average revenue requirement and nil Govt. assistance as grant/subsidy to the Board prior to FY 2006-07. i.e. before the advent of Regulatory Commission and as such, it could not kept such deducted amount in a separate account and in fact, the same utilised in operation expenditure through the working fund of the Board. In this context, it may be mentioned that consequent upon the bifurcation of the erstwhile BSEB, the Ministry of Power, Govt. of India vide its notification dated 4th November, 2004 did not distribute the staff related liabilities and
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provision stating that this would be apportioned in accordance with the Ministry of Power, Govt. of India letter no. 42/9/2000-R&R (Vol-VI) dated 06.01.2004, accordingly to which this liability will be borne on the basis of payment of pension on employees/population ratio. BSEB has accordingly claiming employee cost on the basis of payment through tariff petition before the Commission. 6.23.9 On the issue of creation of trust for employee fund, BSEB vide letter No Com/Tar/132/2011-375 dated 1st March, 2012 has informed the Commission that a trust in the name of BSEB GPF is already under operation in the Board. All the payments under the head GPF is routed through this trust. However, balance in the trust remains nil as the deducted amount from salary of the employees always remains lower than the actual liability due for payment under GPF (Final withdrawal). 6.23.10 The employee cost for 2012-13 has been projected to be Rs. 933.22 Cr.. The details of employee cost for FY 2010-11 (actual), FY 2011-12 (RE) and FY 2012-13 (Projected) is as given below.
Table 117: Employees Cost Proposed for FY 2012-13 (Rs Cr)
Sl.
Particulars SALARIES & ALLOWANCES
FY 2010-11 (Actual) 241.12 97.95 19.84 2.15 0.81 4.49 4.90 371.26 15.58 16.50 0.33 32.41 184.84 1.97 186.81
FY 2011-12 (RE) 265.24 107.74 21.83 2.36 0.90 4.93 5.39 408.39 17.14 18.16 0.36 35.66 203.32 2.17 205.50
FY 2012-13 (Projected) 291.76 118.52 24.01 2.60 0.99 5.43 5.93 449.23 18.85 19.97 0.40 0.01 39.22 223.66 2.39 226.05
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21
Basic Pay + Special Pay Dearness Pay Dearness Allowance House rent Allowance Fixed medical allowance Medical reimbursement charges Over time payment Other allowances Generation incentive Bonus Total Leave encashment Gratuity Commutation of Pension Workman compensation Ex- gratia Total Pension Payment Basic Pension Dearness Pension Any other expenses Total
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Sl. 22 23 24 25 26 27
Particulars Total (11+17+21) Payment made for unfunded liabilities Increase in employee cost Due to New Recruitments Grand Total (22+23+24) Less: Employee cost capitalises Net Employee Cost
FY 2010-11 (Actual) 590.49 172.39 762.88 18.58 744.30
FY 2011-12 (RE) 649.54 189.63 11.07 850.24 20.44 829.80
FY 2012-13 (Projected) 714.50 208.59 32.62 955.71 22.48 933.22
Commissions analysis 6.23.11 The Commission in the Tariff Order for FY 2011-12 had stated that:
4.7.12. So far the contribution of the employees towards GPF and GSS is concerned; this is not a part of employee cost. This amount is deducted from the salary of the employees and should be deposited in a separate fund to be governed by a Trust in which both BSEB and its employees are represented. Any investment out of this fund has to be with the approval of the Trust. 4.7.13. The Commission directs BSEB to report the steps taken towards creation of the trust. The Commission shall be compelled to take appropriate action, if this direction is not complied with immediately.
6.23.12 The Commission has already directed BSEB to create separate trust for making payments for terminal liabilities in its Tariff Order for FY 200607 as reproduced below:
The BSEB shall take steps to invest contribution of employees towards pension etc., through a Trust and make arrangements to pay the pension, gratuity etc., from the earnings of the investments through the Trust.
6.23.13 Accordingly, it is apparent that BSEB has utilised the amounts available in the fund created towards GPF and GSS contribution towards meeting its day to day expenses i.e. for the purpose of funding its working capital requirements. Accordingly, permitting these expenses to be passed on to the consumers shall mean that the consumers have to bear the burden for the past financial mismanagement of the Board. The Commission is of the view that such liabilities on account of past issues should be funded by BSEB through its own means and should not be passed on to the consumers at this point of time. The regulations anyways provide for normative
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working capital interest to be passed on to the consumers thus meeting the working capital requirements of the licensee for the year. However, the Commission has always been allowing the present provision for existing employee on accrual basis 6.23.14 The Commission is of the opinion that since the creation of the Commission, tariff for BSEB has been approved by the Commission based on the justified expense after prudence check by the Commission. The tariff has always been designed by the Commission so as to recover the ARR of the BSEB. Apart from that the State Government support for power purchase has also contributed to reduce the gap and the tariff has been approved based on the same. So the Commission does not agree with the justification made by BSEB that in could not create trust for employee for their terminal benefit because the tariff is lower than the Average cost of supply. 6.23.15 The Commission has projected the employee cost of FY 2012-13 separately for each of the generation, transmission and distribution function considering the figures of audited annual accounts of FY 2010-11 as base value. The Commission in current economic situation considers escalation rate of 9.56% appropriate for determining employee cost for FY2012-13 for each function. The Commission has allowed the additional cost of Rs. 32.62 Cr. for new employees during FY 2012-13 and distributed the same in the ratio of employee cost of each function based on the audited accounts of FY 2010-11. Based on the above, the Commission approves employee cost for FY 2012-13 as depicted in the table given below:
Table 118: Function-wise employee Cost approved for FY 2012-13 (Rs Cr.)
Particulars Employee Cost Effect of new employees Less : Capitalization Net Employee Cost % Share
Generation 38.64 1.74 1.19 39.19 5.33%
Transmission 86.24 3.88 2.65 87.47 11.89%
Distribution 600.17 27.00 18.46 608.71 82.78%
Total 725.05 32.62 22.30 735.37 100.00%
6.23.16 The Commission approves the Employee expenses of Rs. 735.37 Cr. as against Rs. 933.22 Cr. projected by BSEB for FY 2012-13. Repair & Maintenance Expenses (R&M) Petitioners submission
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6.23.17 BSEB has projected R&M expenses of Rs. 110.68 Cr. for FY 2012-13. BSEB has projected that the R&M expenses will increase by 10% in FY 2012-13 from level of FY 2011-12
Table 119: R&M costs submitted by Petitioner for FY 2012-13 (Rs Cr)
Particulars Plant & Machinery Building Hydraulic works Civil Work Line cable & network Vehicles Furniture & fixtures Office equipments Operating expenses Total expenses Add cost of materials procured from Board's Hdqrs Net Expenses Cost of water & Other Misc. Charges Total R&M Expenses charged
FY 2010-11 (Actual) 34.56 2.20 2.93 0.18 17.10 0.09 0.20 0.14 57.40 57.40 5.11 62.51
FY 2011-12 (RE) 43.16 7.27 0.33 2.88 35.03 0.20 0.04 0.15 5.94 95.00 95.00 5.62 100.62
FY 2012-13 (Projected) 47.47 8.00 0.36 3.17 38.53 0.22 0.05 0.16 6.54 104.50 104.50 6.18 110.68
Commissions analysis 6.23.18 The Commission had already approved significant increase for FY 2011-12 during the past Tariff Order with the expectation that higher R&M cost will help BSEB in improving operational efficiency. 6.23.19 The Commission has computed the R&M cost separately for Generation, Transmission and Distribution functions for FY 2012-13 considering the actual function-wise break-up data as per the annual accounts of the Board for FY 2010-11 as base value. The Commission in current economic situation considers escalation rate of 9.56% appropriate for determining R&M cost for FY2012-13. Based on the same, the Commission approves R&M cost for FY 2012-13 as depicted in the table given below:
Table 120: Function-wise approved R&M costs for FY 2012-13 (Rs Cr)
Particulars R&M Cost Add : Water & Misc charges Total % Share
Generation 11.07 6.18 17.25 15.65%
Transmission 14.05 14.05 12.74%
Distribution 78.96 78.96 71.61%
Total 104.09 6.18 110.27 100.00%
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6.23.20 The Commission approves the R&M expenses of Rs. 110.27 Cr. as against projection of Rs. 110.68 Cr. by BSEB for FY 2012-13. Administration & General Expenses (A&G) Petitioners submission 6.23.21 BSEB has projected A&G cost on the 3 years CAGR based on the audited data of A&G expenses for the period FY 2007-08 to FY 2010-11 which is 12%. and thus the A&G expenses post capitalization are projected at Rs. 53.49 Cr. & Rs. 76.88 Cr. for FY 2011-12 & FY 2012-13 respectively.
Table 121: A&G costs submitted by Petitioner for FY 2012-13 (Rs Cr
Particulars Rent, rates & taxes Insurance Telephone, postage &Telegrams Legal Charges Audit Fees Consultancy fees Technical fees Other professional charges Conveyance & travel expenses Others Freight Total expenses Less Capitalised Net expenses Add Prior period Total A&G Expenses Metering, Billing and collection Total A&G Expenses
FY 2010-11 (Actual) 0.50 0.99 0.98 3.25 0.01 4.99 29.39 0.17 40.29 1.46 38.83 38.83 38.83
FY 2011-12 (RE) 0.56 1.11 1.10 3.64 0.01 5.59 32.92 0.19 45.13 1.64 43.49 43.49 10.00 53.49
FY 2012-13 (Projected) 0.63 1.25 1.23 4.08 0.01 6.26 36.87 0.22 50.54 1.83 48.71 48.71 28.17 76.88
6.23.22 BSEB projected that the outsourcing of all metering and billing related activities for all its consumers in FY 2012-13 at the rate of Rs 4.94 per consumer would cost additional Rs. 28.17 Cr. during FY 2012-13. Commissions analysis 6.23.23 The Commission has approved Rs. 28.17 Cr. on account of cost associated with outsourcing of metering and billing related activities during FY 2012-13.
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6.23.24 The Commission in current economic situation considers escalation rate of 9.56% (at Wholesale Price Index rate) appropriate for determining R&M cost for FY2012-13. Based on the same, the Commission approves R&M cost for FY 2012-13 as depicted in the table given below:
Table 122: Function-wise approved A&G costs for FY 2012-13 (Rs Cr)
Particulars A&G Cost Less : Capitalization Add : Metering related cost Total % Share
Generation 1.42 0.05 1.36 1.82%
Transmission 5.25 0.19 5.06 6.77%
Distribution 41.70 1.51 28.17 68.36 91.41%
Total 48.37 1.75 28.17 74.78 100.00%
6.23.25 The Commission approves the A&G expenses of Rs. 74.78 Cr. for FY 2012-13 against the Petitioner claim of Rs 76.88 Cr. Total Operation & Maintenance Cost 6.23.26 The total O&M expenses for each of the Generation, Transmission and Distribution functions, approved by Commission for FY 2012-13 are as given in the table below:
Table 123: Function-wise approved O&M costs for FY 2012-13 (Rs Cr)
Particulars Employee Cost R&M Cost A&G Cost Total O&M Cost
Generation 39.19 17.25 1.36 57.81
Transmission 87.47 14.05 5.06 106.58
Distribution 608.71 78.96 68.36 756.03
Total 735.37 110.27 74.78 920.42
6.24
Capital Expenditure Petitioners Submission
6.24.1 BSEB has taken up R&M works of Unit VI and VII under the RSVY scheme sanctioned by the Planning Commission, Government of India under non-refundable grant. Capacity extension of Muzaffarpur Thermal Power Plant (2x195 MW) & Barauni TPS (2X250 MW) has been sanctioned by the State government. BSEB has also undertaken various transmission network capacity addition, augmentation and improvement projects for achieving its objective of making available reliable power across the State. BSEB is already implementing many schemes for strengthening, augmenting and expanding its distribution network. For FY 2011-12 & FY 2012-13 BSEB would support on-going schemes of Distribution strengthening program. The
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on-going
schemes
include
transformer
replacement,
procurement
of
new
transformers, and replacement of old conductor of HT & LT line, construction of new HT & LT lines, PSS & bays. 6.24.2 BSEB has furnished function wise / scheme wise details of the proposed capital expenditure for FY 2011-12 & FY 2012-13 as given in the table below:
Table 124: Planned Capital Expenditure proposed by BSEB for FY 2012-13
Sl. 1 a) b) 2 a) b) c) 3 a) b) c) d) e) f) g) h) i) j) k) l) m) n)
Particulars Generation Ongoing schemes BRGF Sub Total Transmission RSVY BRGF Mahatma Gandhi Setu Cable crossing Ongoing Scheme Sub Total Distribution Ongoing Scheme APDRP R-APDRP BRGF ADB PMGY MNP Tal Diara Border Area ACA RGGVY Deposit Work Others works Others Capital works Sub Total Total
FY 2010-11 (Actual) 340.66 14.40 355.06 14.67 0.57 15.24 70.89 68.88 0.05 1.18 0.38 0.04 21.94 237.11 24.57 172.14 43.13 640.31 1,010.61
FY 2011-12 (RE) 1,181.21 153.00 1,334.21 450.13 13.96 131.26 595.35 595.42 68.66 96.82 20.00 0.80 0.50 1.00 0.05 76.75 315.28 12.93 52.93 92.50 1,333.63 3,263.19
FY 2012-13 (Projected) 1,296.50 295.04 1,591.54 500.00 13.61 98.16 611.77 712.07 356.81 250.00 55.00 6.07 10.66 1.92 0.43 90.00 489.00 13.00 53.00 110.60 2,148.57 4,351.88
6.24.3 The capitalization rate of capital expenditure and opening balance of CWIP was 30% in FY 2009-10 and 43% in FY 2010-11. BSEB has considered capitalization rate of 43% for FY 2011-12. 6.24.4 BSEB in the additional information vide BSEB letter No. Com/ Tar/161/2011-260 dated 09.02.2012 informed the Commission that capital expenditure for FY 2011-12 & FY 2012-13 has been projected based on Budget of BSEB. BSEB has submitted the summary of loan received during FY 2011-12 till date as shown below:
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Table 125: Details of loan received with sanction letter
Sl.
Name of the scheme
Total value of the scheme (Rs. Cr.) 708.00 3,133.17 59.00 12,964.57 6.15 1.72 51.20 4,207.31 5.10 25.00 5.20 17.50 53.50 129.03 102.50 9.30 4.45 5.90 4.02 4.15 0.09 0.15 5.50 102.50 150.21 77.93 30.23 67.84 21,931.22
Amount released to BSEB (Rs. Cr.) 10.00 100.00 28.50 187.35 4.15 1.72 27.67 29.07 3.10 10.00 4.20 16.50 15.45 20.00 10.00 2.00 1.00 1.00 1.00 1.00 0.09 0.15 4.50 4.00 10.00 8.00 10.00 8.00 518.45
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28
Bihar power sector development programme BTPS Extension R-APDRP Part A Navinagar TPS (3x600 MW) Muzzafarpur Sitamadi Transmission tower height Muzzafarpur Sitamadi Transmission line Tehta, Imamganj 132/33 kV grid Substation Construction of 40 nos. of 33/11 kV substations Ekma (Saran) 132/33 kV substation and associated lines Construction of Janhada 132/33 kV substation Construction of Simutala 33/11 kV substation Construction of 5 substation in Jahanbad district Construction of 40 nos. of 33/11 kV substations APDRP Cent percent metering Construction of 33/11 kV substation in Ekangsarai and Bairgania Construction of 33/11 kV substation in Jamalpur chaksarvar Construction of 33/11 kV substation in Narayanpur Construction of 33/11 kV substation in Saidpur Construction of 33/11 kV substation in Jale Electrificatoin of Akbarpur Village Electrification of 4 villages in Saran District Construction of 33/11 kV substation in Pandrak Consumer metering Distribution transformers Replacement of distribution transformers Capacity enhancement of distribution transformers Replacement of distribution transformers Total
Date of order for release of funds to BSEB 28.06.2011 05.07.2011 05.08.2011 05.08.2011 10.08.2011 10.08.2011 10.08.2011 10.08.2011 10.08.2011 10.08.2011 10.08.2011 10.08.2011 10.08.2011 04.11.2011 28.11.2011 30.12.2011 30.12.2011 28.12.2011 30.12.2011 28.12.2011 30.12.2011 30.12.2011 28.11.2011 10.01.2012 17.01.2012 17.01.2012 17.01.2012 17.01.2012
Commissions View
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6.24.5 As per the licence conditions para 51 of chapter 5 of BERC (Grant of licence for Distribution of electricity) Regulations, 2007, BSEB is required to furnish details of the proposed schemes expenditure before commencement of the project with description of assets and its usability in furthering the efficiency or growth in the business of the Board. Further, BSEB should seek prior approval of such capital expenditure from the Commission. In the absence of the approval, the Commission may disallow corresponding depreciation and interest cost. 6.24.6 After analysing the details submitted by BSEB, Commission vide letter no. BERCTariff 24/11- 825 dated 21st December, 2011 sought clarification on sources of funding like Loans, Capital Grant, Consumer Contribution or Own Funding. In reply BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 provided details of sources of funding. The funding details of various schemes as provided by BSEB are as given in the table below:
Table 126: Funding details proposed by BSEB for FY 2012-13)
FY 2012-13 (Projected) Sl. 1 a) b) 2 a) b) c) 3 a) b) c) d) e) f) g) h) i) j) k) l) m) n) Particulars Generation Ongoing schemes BRGF Sub Total Transmission BRGF Mahatma Gandhi Setu Cable crossing Ongoing Scheme Sub Total Distribution Ongoing Scheme APDRP R-APDRP BRGF ADB PMGY MNP Tal Diara Border Area ACA RGGVY Deposit Work Others works Others Capital works Capital Expenditure 1,296.50 295.04 1,591.54 500.00 13.61 98.16 611.77 712.07 356.81 250.00 55.00 6.07 10.66 1.92 0.43 90.00 489.00 13.00 53.00 110.60 500.00 250.00 Grant Consumer Contribution 13.00 53.00 Borrowings
20.00 295.04 315.04
1,276.50 1,276.50 13.61 98.16 111.77 712.07 356.81 55.00 6.07 10.66 1.92 0.43 90.00 489.00 110.60 Page 199
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Sl.
Particulars Sub Total Total 2,148.57 4,351.88
FY 2012-13 (Projected) 250.00 1,065.04 66.00 66.00 1,832.57 3,220.84
6.24.7 As in the power projects such as Muzaffarpur Thermal Power Plant (2x195 MW) & Nabhinagar Super Thermal Power Plant (3 x 660 MW); BSEB is the equity partner with NTPC for which separate tariff will be determined by the appropriate Commission, So the Commission has not considered the capital expenditure under thses plants for computation of GFA, interest and finance charges and depreciation. With respect to capacity extension of Barauni TPS (2X250 MW) which is expected to be commissioned in June 2014, i.e. FY 2014-15, GFA, interest and finance charges and depreciation has not been considered in FY 2011-12. In light of the above, the Commission has only considered the capital expenditure of Rs. 152 Cr. for FY 201112 and Rs. 295 Cr. for FY 2012-13, as grant under RSVY scheme for R&M of BTPS, for the purpose of computation of GFA. 6.24.8 Based on the details provided by BSEB, the Commission considers the following funding pattern for proposed capital expenditure for computation of allowable interest based on the percentage described in paragraph 6.24.10 and 6.24.11.
Table 127: Funding pattern considered by Commission for FY 2012-13
Sl. 1. 2. 3. 4.
Particular Capital Expenditure Grant Consumer contribution Borrowings
Generation 295.00 295.00 -
Transmission 611.77 500.00 111.77
Distribution 2,148.57 250.00 66.00 1,832.57
Total 3,055.34 1,045.00 66.00 1,944.34
6.24.9 BSEB has proposed significantly high capital expenditure for FY 2011-12 & FY 201213, if the capital expenditure incurred by BSEB in past years is considered. However, the Commission for this order has considered the capital expenditure proposed by BSEB as it has able to demonstrate that equivalent amount funding is available for carrying out the proposed capital expenditure. 6.24.10 The capitalization of the above proposed capital expenditure is considered in accordance with the capitalization schedule given in the table below:
Table 128: Capitalization schedule for proposed capital expenditure
Sl. 1 2 3
1st year 50% 25% 25%
2nd year 50% 30% 25%
3rd year 20% 30% 25%
4th year 20% 15% 25%
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6.24.11 Further for computation of additions to GFA from capitalization of CWIP, the closing balance of FY 2011-12 and the capitalization rate as given in the table below has been considered which is in line with the methodology adopted by the Commission in the Tariff Oreder for FY 2011-12.
Table 129: Capitalization schedule for CWIP
Sl. 1 2 3
FY 2012-13 30% 30% 30%
FY 2013-14 30% 30% 30%
FY 2014-15 40% 40% 40%
6.24.12 To ascertain function wise asset addition due to capitalization of CWIP, the closing balance of CWIP reflected in the annual accounts of FY 2010-11 was segregated into the three functions based on the contribution of these functions to the total GFA at the end of FY 2010-11 6.24.13 Accordingly the addition to the assets from loans, grants and CWIP was computed for FY2011-12 and FY2012-13 6.24.14 The GFA levels as approved by the Commission for FY2012-13 are given in the table below:
Table 130: Approved GFA by Commission FY 2012-13 (Rs. Cr.)
Sl. 1 2 3
Particulars Opening GFA (FY 2012-13) Addition during the year Closing GFA (FY 2012-13)
Generation 444.12 257.34 701.47
Transmission 962.56 405.35 1,367.90
Distribution 3,392.75 1,148.02 4,540.77
Total 4,799.43 1,810.71 6,610.14
6.25
Depreciation Petitioners Submission
6.25.1 BSEB has computed depreciation for FY 2011-12 & FY 2012-13 by calculating depreciation on existing assets at weighted average rates of FY 2010- 11. BSEB has not considered depreciation on assets which are not in use. BSEB has also not considered depreciation on assets which have depreciated upto 90% of its acquisition cost. 6.25.2 BERC (Terms & Conditions for determination of Tariff) Regulation, 2007 provides that the depreciation shall be calculated annually, based on the straight line method over useful life of the asset and at rates prescribed by the Central Electricity Regulatory Commission. Assets capitalized during the year are distributed in various
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heads in the ratio of opening gross block of the respective year. For the new assets capitalized during the year, the depreciation for each of the functions has been projected on the basis of depreciation rates specified in CERCs terms and condition of determination of tariff regulation, 2009.
Table 131: Depreciation charges proposed by BSEB (Rs. Cr.)
Sl. 1. 2. 3. 4.
FY 2010-11 (Actual) 2.43 14.57 72.01 89.00
FY 2011-12 (RE) 21.84 22.78 109.59 154.21
FY 2012-13 (Projected) 69.34 41.69 169.63 280.66
Commissions View 6.25.3 The Commission has considered closing balance GFA as achieved in FY 2011-12 as per the annual accounts of that year. The Commission has thereafter considered asset additions of Rs. 1810.7 Crores for FY 2012-13. This addition is as per the explanation provided in the earlier paragraph at 6.24.14. 6.25.4 It is noted here that the Clause 17 of Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 specifies that depreciation shall be calculated annually based on Straight Line Method at rates specified in Appendix III of the said regulations. Provided that, the remaining depreciable value as on 31st March of the year closing after a period of 12 years from date of commercial operation shall be spread over the balance useful life of the assets. 6.25.5 For old assets where age-wise bifurcation has not been provided by BSEB, the Commission has used the weighted average rate of deprecation achieved in FY 2010-11. For new assets created during FY 2012-13, rates prescribed by CERC have been applied by the Commission to determine deprecation allowable for FY 2012-13. Function wise computation of depreciation has been carried out by the Commission based on projected fixed asset for each function during the FY 2012-13. 6.25.6 Based on approved GFA and capitalization considered during FY 2010-11, the Commission calculated the depreciation for FY 2012-13. However, the depreciation on the assets created out of consumer contribution, grant has been deducted from the gross depreciation to arrive at the net depreciation charge for BSEB. The computation of the depreciation on the assets created out of consumer contribution, grant is based on the average of ratio of Grant and contribution and GFA for past three (3) years. .
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Table 132: Function wise Depreciation approved for FY 2012-13 (Rs Cr)
Sl. 1 2
Particulars Gross Depreciation Net Depreciation
Transmission 38.41 29.59
Distribution 170.91 118.24
Total 224.73 159.77
6.25.7 The Commission approves the depreciation of Rs. 159.77 Cr. as against Rs. 280.66 Cr. projected by BSEB for FY 2012-13. 6.25.8 Directives have been given by the Commission in its previous Tariff Orders for preparation of asset register. However, BSEB has not complied with this directive. The Commission reiterates its directive to prepare the asset register and report status of compliance by 30th June, 2012followed by quarterly progress report. BSEB should compute depreciation as well as interest on loan based on the asset register in the next tariff petition. 6.26 Interest & Finance Charges Petitioners Submission 6.26.1 For calculation of Interest and Finance charges for FY 2011-12 & FY 2012-13, BSEB has considered the closing balance of loans of FY 2010-11 used for funding capital expenditure and the new loans proposed to be drawn during the year as per the indicated capitalization schedule of the proposed capital expenditure. 6.26.2 Based on the capitalization and its funding pattern, additional loan requirement has been worked out for FY 2011-12 & FY 2012-13. BSEB has assumed that all additional funding requirements will be met by the State Government at the rate of 13% per annum. 6.26.3 Total repayment of loans has been considered equal to the depreciation proposed for the year. Repayment of Loans other than state plan loans is proposed at 10% of the opening loan amount. The repayment of state plan loans have been considered equivalent to depreciation amount left after repayment of non-state loans. 6.26.4 For existing loans, prevailing interest rate has been considered while for new loans interest rate of 13% is proposed. Based on the same, BSEB revises its estimate of Interest and Finance Charges for FY 2011-12 to Rs. 464.31 Cr. as against Rs.149.01 Cr. approved by the Commission. BSEB projects Interest and Finance Charges for FY 2012-13 at Rs. 705.72 Cr.. Function-wise Interest & financial charges calculated are as shown in table below:
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Table 133: Proposed Interest & Financial Charges for FY 2012-13
Sl. 1 2 3 4
FY 2010-11 (Actual) 50.80 49.57 230.12 330.49
FY 2011-12 (RE) 100.89 60.33 303.10 464.31
FY 2012-13 (Projected) 205.13 77.11 423.48 705.72
Commissions View 6.26.5 The Commission vide letter no. BERC-Tariff-24/11-88 dated 27th January, 2012 sought details of the loans and the corresponding assets created out of these loans. Since Interest is payable only on loans used for creating usable assets; the Commission has excluded loans raised for working capital or to meet revenue deficit included for interest claimed by BSEB 6.26.6 In absence of desired information and identification of loans used for creation of assets, the Commission decided to adopt an indirect methodology to compute outstanding balance of loans as on 1st April, 2012 used for asset creation. In the absence of the adequate data with BSEB the Commission has considered the repayment during the year as per the Central Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2009 reproduced as below: The repayment for the year of the tariff period 2009-14 shall be deemed to be equal to the depreciation allowed for that year Closing balance of GFA as on 31st March 2012 (as per annual accounts) provides the value of assets created out of all possible sources of funding. If from this balance all the assets created from consumer contribution and grants are excluded then the balance assets have been funded from the loans raised till date. 6.26.7 Further if the accumulated depreciation as on date is excluded then balance will be the assets funded out of existing loans. The accumulated depreciation can be considered as proxy for the loans repaid till date. The Commission has used this concept to compute opening level of loan as on 1st April, 2012 used for the creation of fixed assets. The Commission considers this approach reasonable in the absence of supporting evidence of utilization of loans for asset creation and its usability in business. However, Commission may revisit this computation on getting the actual details from BSEB at the time of review/ true-up based on audited accounts of FY 2012-13.
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6.26.8 The additional loan to the extent of asset capitalized during the year can only be considered for interest cost computation. Interest cost on remaining loan amount should be capitalized and considered as part of capital cost of the asset. This is in accordance with the BERC (Terms and condition for determination of Tariff) Regulation, 2007, which provides for interest only on assets which are capitalized and not on the entire capital expenditure incurred during the year. 6.26.9 Assets capitalized during the year can be funded through grant, consumer contribution and borrowing. Interest is payable on loans equivalent to capitalized assets funded through borrowings only. To determine this additional loan the proposed capitalization is segregated in the ratio of existing levels of grant, consumer contribution and borrowings. 6.26.10 The approved depreciation during the year is used as the repayment amount during the year. 6.26.11 Interest rate of 13% as proposed by BSEB has been verified from the sanction letters issued by the State Government and the proposed rate was found in line with the interest rate charged by the State Government. The Commission has computed the interest and finance charges for each function on the basis of the loan availed by the Board for the respective function. 6.26.12 The repayement of the loan during the tyear has been computed at 10% of the outstanding loan at the beginning of the year as per the methodology adopted in Tariff order for FY 2011-12. 6.26.13 The Commission has considered the closing balance of loan for FY 2011-12 (as per review Order for FY 2011-12) as the opening loan for FY 2012-13 and has computed the interest on loan for FY 2012-13. The Commission has computed the interest on loan as per the methodology adopted in Tariff order for FY 2012-13, Based on the above, interest on loan for FY 2012-13 as approved by Commission based on capitalization considered during the year is given in the table below:
Table 134: Approved revised estimate of Interest & Finance Charges for FY 2012-13 (Rs Cr)
Sl. 1 2 3
Particulars Opening Loan Addition of Loan Repayment of Loan/Depreciation
FY 2011-12 (Approved in revised estimate of FY 2011-12) 471.49 558.99 47.15
Approved for FY 2012-13 983.33 1,072.94 98.33
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TARIFF ORDER FOR FY 2012-13 FY 2011-12 (Approved in revised estimate of FY 2011-12) 983.33 13.00% 94.56
Sl. 4 5 6
Particulars Closing Loan Interest rate Interest on Loan
Approved for FY 2012-13 1,957.93 13.00% 191.18
6.26.14 Based on the interest finance charges of FY 2010-11 as per audited annual accounts of BSEB, the interest cost for Generation, Transmission and Distribution business of BSEB has been worked out.
Table 135: Approved revised estimate for Interest & Financial Charges for FY 2012-13
Sl. 1 2 3 4
Approved in FY 2012-13 41.14 28.68 121.37 191.18
6.26.15 The Commission approves the interest cost of Rs. 191.18 Cr. as against Rs. 705.72 Cr. projected by BSEB for FY 2012-13. 6.27 Interest on Working Capital Petitioners Submission 6.27.1 BSEB has proposed interest on working capital in accordance with the applicable regulations notified by the Commission. The considerations for computing working capital requirement and interest thereon are summarized in the table below for each of the functions of BSEB.
Table 136: Methodology adopted by BSEB for calculation of Working Capital
Description Norms for calculation
Generation Thermal WC = 2 months cost of coal + 2 months cost of secondary fuel oil + Maintenance spares (at 1% of GFA escalated at 6 % per annum) + 1 month O&M + Receivables (2 months of fixed and variable charges).
Transmission
Distribution
Reference
WC = Maintenance WC=1 month spares ((at 1% of O&M + GFA escalated at 6 Maintenance % per annum) + spares (at 1% Receivables (2 of GFA months of escalated at 6 transmission % per annum) + charges) + 1 month 2 months O&M revenue BERC (Terms and conditions for determination of Tariff) Regulations, 2007.
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6.27.2 BSEB has proposed short-term prime lending rate of SBI as on 01/04/2012 i.e. 13.00% for computing interest on working capital. The BSEB has proposed interest on working capital at Rs. 211.67 Cr. for FY 2012-13.
Table 137: Proposed Interest on Working Capital for FY 2012-13 (Rs Cr)
Particulars 2 month primary fuel & secondary fuel 1 month O&M Receivables Maintenance Spares Total WC Requirement Interest Rate (SBI PLR as on Apr11) Interest on Working Capital
Generation 158 6 95 11 270 13.00% 35.11
Transmission 11 58 11 81 13.00% 10.49
Distribution 76 1,163 38 1,277 13.00% 166.07
Total 158 93 1,316 60 1,628 13.00% 211.67
Commissions View 6.27.3 The Commission is of the view that, since the working of BSEB is still as an integrated unit, the Commission has not considered receivables for Generation and transmission function. 6.27.4 Interest on working capital is computed on normative basis as per BERC (Terms and conditions for determination of Tariff) Regulations, 2007. SBI PLR rate of 13% as on 1st April, 2011 has been considered for calculation of interest for funding working requirement. Based on the same, Commission approves interest on working capital for FY 2012-13 as given in the table below:
Table 138: Approved Interest on Working Capital for FY 2012-13 (Rs Cr)
Particulars 2 month primary fuel & secondary fuel 1 month O&M Receivables Maintenance Spares Total WC Requirement Interest Rate (SBI PLR as on Apr11) Interest on Working Capital
Generation 15.91 4.26 10.32 30.49 13% 3.96
Transmission 8.88 12.37 21.25 13% 2.76
Distribution 63.00 982.09 33.93 1,079.02 13% 140.27
Total 15.91 76.14 982.09 56.62 1,130.76 13% 147.00
6.27.5 The Commission approves the interest on working capital of Rs. 147.00 Cr. as against Rs.211.67 Cr. projected of by BSEB for FY 2012-13. 6.28 Non-Tariff Income Petitioners submission
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6.28.1 BSEB has projected non-tariff income of Rs. 55.11 Cr. for FY 2012-13. BSEB has mainly considered 3 year CAGR to project non-tariff income for FY 2012-13 based on the actual income of FY 2010-11. 6.28.2 BSEB has also requests the Commission not to consider any income from DPS as it is a source for funding increased working capital requirement and also requested the Commission not to consider income from interest on un-utilized funds while determining ARR for FY 2012-13. 6.28.3 The detailed break-up of non-tariff income claimed by the Petitioner is as below:
Table 139: Break-up of proposed non-tariff income for FY 2012-13 (Rs.Cr.)
Sl. 1 2 3 4 5 6 7 8 9 10 11 12 13 15 17 18 19
Particulars Meter/Service rent Late payment surcharge Theft / pilferage of energy Misc. receipts Misc. charges (except PLEC) Wheeling charges Interest on staff loans & Income from trading Income from welfare activities Rental Tender Registration Interest of Bank Deposit Rebate & discount received Incentive for timely payment against loan to PFC Incentive for timely payment against loan to PFC Total Income Add Prior period income Total Non-tariff income
FY 2010-11 (Actual) 25.00 38.24 10.00 2.79 10.55 0.01 1.02 53.48 26.06 1.08 168.23 168.23
FY 201112 (RE) 22.38 4.07 16.32 0.05 1.05 3.06 0.44 1.16 48.54 48.54
FY 201213 (Projected) 26.53 4.80 17.95 0.11 1.05 3.06 0.44 1.16 55.11 55.11
Commissions analysis 6.28.4 The Commission agrees with the methodology adopted by BSEB to compute nontariff income. At the same time, the Commission feels that it is necessary to adjust some components of non-tariff income based on recent developments in the sector which do appropriately reflect the past trend. Also, the Commission has allocated entire non-tariff income to the distribution function on BSEB. 6.28.5 The Commission has approved the meter rent, Interest on Staff Loan & Advance, and Misc. charges from consumers for FY 2012-13 based on the three (3) years
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CAGR based on actual value for FY 2010-11. For other components of Non-tariff income, the Commission has considered the actual value of FY 2010-11. 6.28.6 The Commission has adopted the approach on for DPS as a part of Non-tariff income in line with the recent judgement of Honble Appellate Tribunal for Electricity (APTEL) dt. 12.07.2011 in Case no 142 & 147 of 2009. 6.28.7 The relevant extracts of the Judgment are reproduced below: The normative working capital compensates the distribution company in delay for the 2 months credit period which is given to the consumers. The late payment surcharge is only if the delay is more than the normative credit period. For the period of delay beyond normative period, the distribution company has to be compensated with the cost of such additional financing. It is not the case of the Appellant that the late payment surcharge should not be treated as a non-tariff income. The Appellant is only praying that the financing cost is involved due to late payment and as such the Appellant is entitled to the compensation to incur such additional financing cost. Therefore, the financing cost of outstanding dues, i.e. the entire principal amount, should be allowed and it should not be limited to late payment surcharge amount alone. Further, the interest rate which is fixed as 9% is not the prevalent market Lending Rate due to increase in Prime Lending Rate since 2004-05. Therefore, the State Commission is directed to rectify its computation of the financing cost relating to the late payment surcharge for the FY 2007-08 at the prevalent market lending rate during that period keeping in view the prevailing Prime Lending Rate. 6.28.8 The Commission has computed DPS of Rs. 30.84 Cr.for FY 2012-13 based on the three (3) years CAGR applied on the actual value for FY 2010-11. As the Petitioner charges DPS @ 18% per annum (1.5% per month), the principal amount on which DPS would be charged comes as Rs.154.64 Cr. 6.28.9 As prevailing SBI PLR as on April 1, 2011 was 13%, the Commission has allowed the financing cost for DPS @ 13%. The financing cost approved by the Commission is shown below:
Particular DPS as per projections (@ 1.5% per month) (A) Principal amount on which DPS was charged (B = A / 18%) Interest Rate for funding of Principle of DPS
FY 2012-13 30.84 171.35 13.00%
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Particular Interest on funding of Principal amount of DPS
FY 2012-13 22.28
6.28.10 The Commission has sought additional information vide its letter No. BERC-Tariff24/11-272 dated 23.03.2012 seeking information on actual DPS collected by the Board. However, the Board has replied vide letter no. Com/ tariff-161/11-488 dated 23.03.2012 saying that the same is not available as of now and shall be made available only once the IT based billing system is implemented under the ongoing RAPRDRP Scheme. 6.28.11 The Commission is not satisfied with the justification given by the Board for not maintaining records for actual revenue receipts against DPS. The Commission directs the Board to submit the same as per actuals in its subsequent filings/ true-up petitions, in the absence of which the Commission shall consider 100% DPS as nontariff income for the purpose of calculation of the ARR. 6.28.12 Hence, the Commission has computed the amount of Non-Tariff Income as summarised below:
Table 141: Approved Non-Tariff Income for FY 2012-13 (Rs. Cr.)
Particular Non-Tariff Income as per the Annual accounts Interest on Staff Loan & Advance Income from Investment (F.D) Interest on Loan & advance to licensees D.P.S from Consumer Interest on advance to Supplier/Contractor Interest from Bank (Other then F.D) Income from Trading Income from Staff Welfare activities Miscellaneous Receipt. Rebate and Discount Received Incentive for timely payment of power purchase bills Incentive for timely payment of instalment against Loan to PFC Meter Rent Wheeling charges Miscellaneous Charges from Consumers Total Non-Tariff Income Less: Financing cost of Principle amount of D.P.S. Net Non-Tariff Income
FY 2012-13 0.05 30.84 53.48 1.05 3.49 17.93 1.16 0.46 25.51 15.47 149.44 22.28 127.16
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6.28.13 The Commission approves the non-tariff income of Rs. 127.16 Cr. as against Rs.55.11 Cr. projected by BSEB for FY 2012-13. 6.29 Return on Equity Petitioners submission 6.29.1 BSEB has submitted that its asset are funded through loans and grants from the Government of Bihar, loans and grants under specialized funding schemes of the Government of India and loans from commercial lending organizations. 6.29.2 BSEB has also submitted that the in states like Jharkhand, Punjab, Chhattisgarh and Kerala, where integrated Boards like BSEB were / are operational, the appropriate Commissions have allowed / allow for a reasonable return on equity despite the fact they have capital structure which is very much similar to that of BSEB and are mainly funded through loans/ grants from respective State Governments. 6.29.3 BSEB has requested for the reasonable return of 14% on normative equity of 30% of the Gross Fixed Assets (net off capital grants/ subsidies) in the ARR for the year 2012-13 of Rs. 282 Cr. Commissions analysis 6.29.4 Return is admissible only on equity actually deployed for the creation of assets. Since, BSEB has not been corporatized; it does not have any equity. The Commission has considered entire assets base funded through loan and accordingly interest has been allowed. Therefore, no return is payable on notional equity. 6.30 Revenue from Sale of Power at Existing Tariff for FY 2012-13 BSEBs Submission 6.30.1 BSEB has furnished the revenue from existing tariff at Rs.2972.84 Cr. for the FY 2012-13. BSEB has proposed separate tariff for Patna and Rest of Bihar. The revenue from sale of power as projected by BSEB is given in the table below:
Table 142: Revenue Projected for Premium tariff area, RoB and BSEB at existing tariff Premium Tariff Particular Rest of Bihar Total Bihar Areas
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Energy Sale (MU) Kutir Jyoti (R) Kutir Jyoti (U) DS - I (R) DS- II Single Phase Three Phase DS- III NDS-I (R) NDS-II (U) Single Phase Three Phase NDS-III LTIS-I LTIS-II Public Water Works IAS-I (Private) IAS-II (Government) SS-I (Metered) SS-II (Unmetered) HTS-I HTS-II HTS-III HTSS RTS-I Total 159.87 95.92 0.54 35.70 50.94 24.99 15.52 1.99 1.10 8.70 425.78 168.44 37.22 1,612.45 111.93 69.82 0.23 21.82 30.70 11.97 2.02 0.49 0.48 1.66 257.44 87.57 22.55 818.45 187.35 112.41 16.73 155.03 71.92 35.40 256.11 114.98 4.51 18.86 499.67 238.83 221.30 239.66 784.77 5,500.53 136.23 86.37 5.17 88.35 61.28 16.29 33.29 76.12 1.80 5.23 285.87 129.32 116.53 93.50 418.98 2,154.39 544.15 38.45 0.13 186.32 12.89 0.03 707.75 50.01 0.99 21.95 246.62 17.07 0.35 6.52 0.49 2.53 Energy Sale (MU) 716.28 0.79 1,045.21

Energy Sale (MU) 716.28 1.29 1,047.74 Average Realisation (Rs/ unit) 1.62 1.80 2.04
Revenue (Rs Cr.) 0.09 0.44
Revenue (Rs Cr.) 115.80 0.14 213.54
Revenue (Rs Cr.) 115.80 0.23 213.98
1,251.90 88.46 0.99 22.08
432.93 29.97 0.35 6.56
3.46 3.39 3.53 2.97
347.22 208.33 17.27 190.72 122.87 60.39 271.63 317.05 5.61 27.56 925.45 407.26 221.30 276.87 784.77 7,313.05
248.16 156.19 5.39 110.17 91.98 28.26 35.31 76.61 2.29 6.89 543.30 216.90 116.53 116.04 418.98 2,972.84
7.15 7.50 3.12 5.78 7.49 4.68 1.30 2.42 4.08 2.50 5.87 5.33 5.27 4.19 5.34 4.07
Commissions analysis 6.30.2 In the petition BSEB has not submitted complete details of break-up of revenue from existing tariff category / sub category and slab wise. In response to a query from the Commission vide letter No.. BERC- Tariff 24/11- 825 dated 21st December, 2011 BSEB vide letter No Com/Tar/161/2011-260 dated 09th February, 2012 furnished the above revenue details. From scrutiny of the details submitted by BSEB it becomes evident that slabwise details provided by BSEB are based on certain assumptions
which are without supporting details.

6.30.3 For a proper analysis and realistic estimation of revenue from existing/ proposed tariff the particulars of number of consumers, sales, connected load /contracted demand,
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revenue from fixed charges, revenue from variable charges, any other revenue category wise, sub category wise and slab wise are essential. BSEB has come under the regulatory regime and the Commission has already issued four Tariff Orders for FY 2006-07 on 29th Nov06, for FY 2008-09 on 26th Aug08, for FY 2010-11 on 06th Dec10 and for FY 2011-12 on 1st May11. The above data is a regulatory requirement and BSEB is required to maintain/build the database as per the regulatory requirement. 6.30.4 The Commission has analysed the slab-wise data as provided by BSEB and based on the same, computed the revenue at existing tariff with respect to the approved sales.
Table 143: Revenue assessed for BSEB at existing tariff by Commission
Projected by BSEB for FY 201213 Particular Kutir Jyoti (Rural) Kutir Jyoti (Urban) DS - I (Rural) DS- II Single Phase Three Phase DS- III NDS-I (Rural) NDS-II (Urban) Single Phase Three Phase NDS-III LTIS-I LTIS-II Public Water Works IAS-I (Private) IAS-II (Government) SS-I (Metered) SS-II (Unmetered) HTS-I HTS-II HTS-III HTSS Energy Sale (MU) 716.28 1.29 1,047.74 1,251.90 88.46 0.99 22.08 347.22 208.33 17.27 190.72 122.87 60.39 271.63 317.05 5.61 27.56 925.45 407.26 221.30 276.87 Revenue (Rs Cr.) 115.80 0.23 213.98 432.93 29.97 0.35 6.56 248.16 156.19 5.39 110.17 91.98 28.26 35.31 76.61 2.29 6.89 543.30 216.90 116.53 116.04
Estimated by Commission for FY 2012-13 Energy Sale (MU) 455.94 1.46 1,047.74 1,406.10 18.81 0.99 22.15 363.62 218.17 18.08 196.62 126.66 160.32 271.63 317.17 6.98 34.29 966.94 425.52 221.30 446.51 Revenue (Rs Cr.) 72.57 0.27 196.82 477.38 10.33 0.37 5.14 255.80 160.69 5.64 105.79 76.78 68.85 31.34 76.41 2.85 7.33 574.84 238.13 117.92 161.28
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Projected by BSEB for FY 201213 Particular RTS-I Total Energy Sale (MU) 784.77 7,313.05 Revenue (Rs Cr.) 418.98 2,972.84
Estimated by Commission for FY 2012-13 Energy Sale (MU) 784.77 7,511.79 Revenue (Rs Cr.) 424.11 3,070.63
6.31
Revenue from sale to Nepal & UI BSEBs Submission
6.31.1 BSEB has sold 555 MU of energy to Nepal at rate of Rs. 4.66 per kWh in FY 201011. BSEB projected the same trend to continue for FY 2011-12 & FY 2012-13. BSEB has projected revenue from sale of power to NEA for FY 2011-12 & FY 2012-13 at Rs. 258.63 Cr. each. 6.31.2 BSEB has projected that sale under UI for the FY 2011-12 & FY 2012-13 will be same as that of FY 2010-11. BSEB has projected its revenue from sale of power under UI assuming average price of Rs. 3.09 per unit equal to the rate for FY 201011. Revenue from sale of power under UI for FY 2011-12 & FY 2012-13 is projected at Rs. 90.54 Cr. each. Commissions analysis 6.31.3 The Commission approves the projected sales to Nepal at 555 MU at Rs 258.63 Cr. for FY 2012-13, as it is obligatory to supply power to Nepal. 6.31.4 The Board has projected the energy sales of 293 MUs under un-scheduled interchange (UI)] for the FY 2012-13. The Commission is of the view that, as per the energy balance the Board is left with additional power to the extent of 2228 MUs. BSEB has submitted that, the BSEB shall supply 266 MUs additional power to towns where premium tariff is proposed, industrial categories on LT line, urban areas, PWW and Street Lights. Accordingly, the Commission approves 293 MUs for sale under UI as prima facie it seems that it will not impact the supply hour of existing and proposed consumer base of BSEB. Accordingly, the Commission approves the proposed sale under UI for the FY 2011-12 @ Rs. 3.67 per unit, the average power purchase cost for the year, for an amount of Rs. 107.76 Cr.
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6.32
Revenue from sale of Additional Power BSEBs Submission
6.32.1 BSEB has submitted that, additional hours of power supply will be provided to towns where premium tariff is proposed, industrial categories on LT line, urban areas, PWW and Street Lighting. BSEB has projected additional revenue of Rs. 135.38 Cr at existing tariff and 203.66 Cr. at proposed tariff through sale of this additional power at the rate of average revenue realisation rate of the categories mentioned for FY 201213. Commissions analysis 6.32.2 BSEB has projected energy balance at the projected T&D loss level of 41%. The Commission has already given T&D loss target of 27.5% to BSEB for the FY 2012-13 in its Tariff Order for FY 2011-12 dated 1st May, 2011. 6.32.3 The Commission is of the view that, as per the energy balance the Board is left with additional power to the extent of 2228 MUs. For which BSEB has submitted that power to the extent of 266 MUs shall be supplied to towns where premium tariff is proposed, industrial categories on LT line, urban areas, PWW and Street Lights. Accordingly, the Commission approves 293 MUs for sale under UI as prima facia it seems that it will not impact the supply hour of existing and proposed consumer base of BSEB. 6.32.4 For FY 2012-13, the Commission has worked out energy balance based on T&D loss level of 27.5% as against 41% projected by BSEB. Also, in the energy balance, BSEB is proposing availability of 266 MUs of additional power in BSEB system for sale. The Board has proposed to sell this additional power to industrial categories on LT line, urban areas, PWW and Street Lights and the towns where premium tariff is proposed. Considering the supply shortage situation in the State, the Commission is of the opinion that BSEB can sell higher amount of energy and to that extent it can bill higher revenue. 6.32.5 To work out the average realisation rate for this sale the Commission has considered that the additional power can be absorbed by all categories of Consumers in BSEB system including HT consumers. Average energy realisation rate of all consumers category other than Kutir Jyoti has been considered to determine additional revenue
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that can be available to BSEB. Based on the above methodology, additional revenue of Rs. Rs. 120.99 Cr. has been considered for FY 2012-13 as shown below:
Table 144: Additional Revenue for the FY 2012-13
Particular Energy available for sale to Consumers Average Energy realisaiton rate (excluding KJ & agriculture) Additional revenue at existing tariff
Unit MU Rs./Unit Rs. Cr.
FY 2012-13 Approved by Commission 265.85 4.55 120.99
6.33
Resource gap funding for meeting cost of additional power purchase BSEBs Submission
6.33.1 Based on the Commissions approved T&D loss trajectory, BSEB in its petition has requested the Commission to consider the energy balance as projected for FY 201213 and accordingly approve the additional power purchase of 2567 MUs. 6.33.2 BSEB has also submitted that during FY 2012-13, BSEB will under-achieve the T&D loss as compared to the T&D loss trajectory approved by the Commission hence would require to purchase additional power of 2567 MUs for FY 2012-13 as indicated in Energy Balance. Based on the net power purchase rate, additional power purchase cost works out to Rs. 955.74 Cr. for FY 2012-13. 6.33.3 BSEB has also informed the Commission in the ARR and tariff petition for FY 201213 that the State Government is providing financial assistance in the form of resource gap funding to bridge the gap between expenses allowed by the Commission and actual expenses incurred by BSEB. Commissions analysis 6.33.4 Based on the letter from State Government on utilisation of resource gap grant, the Commission has adjusted the cost of additional power purchase requirement on account of difference in actual T&D loss of BSEB and T&D loss approved by the Commission from the resource gap funding by the state Govt. The approach has reduced the net power purchase cost of the BSEB for the FY 20012-13. The Commission has computed the cost of additional 2338 MUs (as per approved energy balance) of power at the power purchase rate of medium/ short term power and has reduced the same amount from the power purchase cost of BSEB to arrive at the net power purchase cost of Rs. 4175 Cr. for FY 2012-13.
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6.33.5 The table below summarises the computation of net Power purchase cost of BSEB for FY 2012-13.
Table 145; Approved cost of additional power purchase through resource gap for FY 2012-13
Particular Additional power purchase by BSEB Power purchase rate of Medium/ Short GoB support for cost of Additional power purchased (A) Gross Power purchase cost for FY 2012-13 (B) Approved Net Power purchase cost for BSEB (B) (A)
Unit MU Rs./Unit Rs. Cr. Rs. Cr. Rs. Cr.
Approved by Commission for FY 2012-13 2,338.03 4.31 1,006.5 5,181 4,175
6.34
Past Recoveries BSEBs Submission
6.34.1 BSEB has computed total revenue through past recovery as Rs.5032.8 Cr. Based on its True-up petition for the period FY 2006-07 to FY 2010-11 which also includes carrying cost on the revenue gap. Commissions analysis 6.34.2 The Commission has conducted the detailed analysis and truing up for the period of FY 2006-07 to FY 2010-11 based on the audited annual accounts of these years and Review of FY 2011-12. The summary of revenue gap/surplus approved by the Commission is given as below:
Table 146: Approved Revenue Gap/Surplus for FY 2006-07 to FY 2011-12 (Rs. Cr.)
Particular Revenue Gap/ (Surplus) with carrying cost for FY 2006-07 Revenue Gap/ (Surplus) with carrying cost for FY 2007-08 Revenue Gap/ (Surplus) with carrying cost for FY 2008-09 Revenue Gap/ (Surplus) with carrying cost for FY 2009-10 Revenue Gap/ (Surplus) with interest for FY 2010-11 Revenue (Gap)/Surplus for FY 2011-12 (as per review of FY 2011-12) Cumulative Revenue Gap/ (Surplus)
Approved by Commission 7.23 86.56 123.41 274.67 (639.93) (674.63) (822.69)
6.34.3 The aggregate revenue gap along with carrying cost/ interest from FY 2006-07 to FY 2011-12 approved by the Commission resulting in a cumulative revenue surplus of Rs 822.69 Cr. The Commission shall consider this surplus revenue in the ARR for FY 2012-13.
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6.35
Aggregate Revenue Requirement of BSEB for FY 2012-13
6.35.1 The summary of revenue requirement of BSEB for the FY 2012-13 as analysed in the preceding paragraphs is given in the table below:
Table 147: Aggregate Revenue Requirement for the FY 2012-13 at existing tariff (Rs. Cr.)
Sl. 1 2 3 4 5 6 7 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23
Particular Power Purchase Cost Fuel R&M Cost Employee Cost A&G Cost Depreciation Interest & Financial Charges Interest on Working Capital Return on Equity Total Revenue Requirement Less: Non-Tariff Income Less : Disallowable Power Purchase Cost/ Government Support for Power Purchase Cost Less : Sale of Power Outside State Add : Recovery/ (surplus) of Revenue Gap of past filing Net Revenue Requirement Less: Revenue from existing tariff Gap (=16-17) Less: Revenue from sale of power to Nepal Less: Revenue from sale of power in UI Less: Revenue from sale of addl. Power Gap Less: Resource Gap Assistance Net Gap at existing tariff
FY 2012-13 Projected by BSEB 5,139.49 158.13 110.68 933.22 76.88 280.66 705.72 211.67 281.68 7,898.13 55.11 955.74 5,032.83 11,920.11 2,972.84 8947.27 258.63 90.54 135.41 8,462.69 124.26 8,338.43
FY 2012-13 Approved by BERC 5,181.71 103.52 110.27 735.37 74.78 159.77 191.18 147.0 6,703.6 127.16 1,006.52 (822.69) 4,747.22 3,070.63 1676.60 258.63 107.76 120.99 1,189.22 1,189.22
6.35.2 From the above table it can be seen that after considering the State Government support for cost of additional power purchase requirement on account of difference in actual T&D loss of BSEB and T&D loss approved by the Commission, the net revenue gap approved by the Commission for FY 2012-13 is Rs. 1189.22 Cr., with revenues projected at existing tariff as against Rs. 8338.43 Cr. projected by BSEB. 6.35.3 Function wise expenses namely generation, Transmission and Distribution approved by the Commission are as given in the table below:
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Table 148: Function-wise breakup of ARR approved by Commission for FY 2012-13 (Rs. Cr.)
Sl. 1 2 3 4 5 6 7 9 10 11
Particulars Power Purchase Cost Fuel R&M Cost Employee Cost A&G Cost Depreciation Interest & Financial Charges Interest on Working Capital Return on Equity Total Revenue Requirement
Generation -
Transmission -
Distribution 5,181.71
Total 5,181.7 1 103.52 110.27 735.37 74.78 159.77 191.18 147.00 6,703.5 9
103.52 17.25 39.19 1.36 11.94 41.14 3.96 218.36
14.05 87.47 5.06 29.59 28.68 2.76 167.61
78.96 608.71 68.36 118.24 121.37 140.27 6,317.62
6.36
Revenue at Approved Tariff
6.36.1 The Commission has revised the existing retail tariff and approved retail tariff for FY 2012-13 in the subsequent chapter Tariff principles, design and tariff schedule. The Commission expects additional revenue of Rs. 348.06 Cr. on account of tariff revision which indicates a tariff rise of 12.1%. 6.36.2 The estimated additional revenue from the approved tariffs for the FY 2012-13 from various categories of consumers is given in table below:
Table 149: Revenue from Sale of energy at Approved Tariff for FY 2012-13
Particular Kutir Jyoti (Rural) Kutir Jyoti (Urban) DS - I (Rural) DS- II Single Phase Three Phase DS- III NDS-I (Rural) NDS-II (Urban) Single Phase Three Phase NDS-III LTIS-I LTIS-II Public Water Works
Energy Sale (MU) 455.94 1.46 1,047.74 1,406.10 18.81 0.99 22.15 363.62 218.17 18.08 196.62 126.66 160.32
Revenue (Rs Cr.) 72.57 0.27 196.82 500.37 10.53 0.40 5.14 260.19 160.92 6.22 116.89 84.73 114.43
Average realization (Rs. per unit) 1.59 1.87 1.88 3.56 5.60 4.07 2.32 7.16 7.38 3.44 5.94 6.69 7.14 Page 219
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Particular IAS-I (Private) IAS-II (Government) SS-I (Metered) SS-II (Unmetered) HTS-I HTS-II HTS-III HTSS RTS-I Total
Energy Sale (MU) 271.63 317.17 6.98 34.29 966.94 425.52 221.30 446.51 784.77 7,511.79
Revenue (Rs Cr.) 31.34 178.64 4.63 19.85 632.15 260.28 127.89 170.33 464.10 3,418.68
Average realization (Rs. per unit) 1.15 5.63 6.63 5.79 6.54 6.12 5.78 3.81 5.91 4.55
6.37
Revenue Gap at Approved Tariff
6.37.1 The expected revenue gap at approved tariffs for the FY 2012-13 is Rs. 841.17 Cr. as given in table below:
Table 150: Revenue Gap at Approved Tariff for FY 2012-13 (Rs. Cr.)
Sl. 1 2 3 4 5 6 7 8 9 10 11
Particular Net Revenue Requirement Less: Revenue from approved tariff Less: Revenue from sale of power to Nepal Less: Revenue from sale of power in UI Less: Revenue from sale of addl. Power Gap Less: Resource Gap Assistance Net Gap Energy Sale (MU) Average Cost of Supply without Grant (Rs/ kWh) Average Cost of Supply with Grant (Rs/ kWh)
FY 2012-13 Approved by BERC 4,747.22 3,418.68 258.63 107.76 120.99 841.17 841.17 8,625.64 5.50 4.71
6.37.2 As per the letter from State Government dated 19th Sep 2011, the treatment of support from State Government is considered to compensate in full for the financial losses caused to BSEB on account of additional power purchase due to difference in the actual T&D loss and the T&D loss as determined/ approved by the Commission and an additional grant of up to Rs. 1080 Cr. shall be available to subsidize agriculture and rural consumers. Further, the State Government again clarified during the meeting with the BSEB and Commission held 19th March2012 that the subsidy would be only for agriculture and rural consumers, subject to maximum of Rs. 1080 Cr.. The Commission the treatment of subsidy/ support from State Government accordingly for FY 2012-13 in this Tariff Order.
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6.37.3 In view of the above, the Commission approves an average tariff hike of 12.1 % during FY 2012-13. It may be noted that the Commission has not approved any tariff hike for Kutir Jyoti (Rural & Urban), Domestic I (Rural), Non-Domestic-I (Rural), Irrigation and Agriculture Pumpset (IAS-I) category in this Tariff Order as the same are being subsidized by the State Government for the FY 2012-13. 6.37.4 The approved tariff hike is expected to accrue to reduce the net gap for the FY 201213 to the extent of 157.26 Cr. as worked out in the tariff below:
Table 151: Revenue Gap at Approved Tariff for FY 2011-12 (Rs. Cr.)
Sl. 1 2 3 4 5 6 7 8
Particular Net Revenue Requirement Less: Revenue from approved tariff Less: Revenue from sale of power to Nepal Less: Revenue from sale of power in UI Less: Revenue from sale of addl. Power Gap Less: Tariff subsidy from State Government Net Gap
FY 2012-13 Approved by BERC 4,747.22 3,418.68 258.63 107.76 120.99 841.17 683.90 157.26
6.37.5 The Commission has approved an average tariff hike of 12.1 % during FY 2012-13 which is reasonable. This hike has been approved to minimize revenue gap of BSEB. It is felt that any sharp increase in tariff would have caused undue hardship to the consumers and the tariffs need to be gradually made to reflect the actual cost of supply. It may be noted that the approved value of regulatory asset in this Tariff Order being carried forward to subsequent years is justifiable on the following grounds: There was already a regulatory asset to the tune of Rs. 245 Cr. approved in the Tariff Order for FY 2011-12 which was carried forward to FY 2012-13. The regulatory asset now being approved is considering the cumulative impact for the period FY 2006-07 up to FY 2012-13. The Commission has approved substantial tariff increase consecutively in FY 2010-11 and FY 2011-12 therefore it was felt that any substantial increase in tariff would be an additional burden to the consumer. Moreover, there has been a sudden change in the policy of the State Government in which it has been allowing for adjustment of grant/ subsidies to
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the BSEB. A Bulk of the subsidy support which was earlier being used to reduce the overall ARR is now being used to compensate the BSEB for the disallowed power purchase cost on account of higher than approved T&D losses. Secondly, the Government has clarified that a subsidy support shall be made available to the BSEB only for Agriculture and Rural consumers up to a maximum limit of Rs. 1080 Cr. Therefore, the subsidy support which was in a subsidizing all consumers of BSEB to the extent of the Approved ARR is not available for the rest of the consumer categories. Had the Government made total subsidy support of Rs. 1800 Cr. for FY 2012-13 (as already made available for FY 201112) and also continued with the previous adjustment practice, there would have been no need for any tariff increase during FY 2012-13. 6.37.6 Therefore, the Commission has decided to retain net revenue gap of Rs. 157.26 Cr. for FY 2012-13 to avoid sudden tariff shock. This unrecovered gap is considered as Regulatory Asset to be amortized in subsequent years. BSEB may have to mobilize financial resources to maintain its cash flow and the Commission will allow carrying cost of the same. 6.38 Average Tariff as percentage of Average Cost in Tariff Order for FY 2011-12 & FY 2012-13 6.38.1 The Commission has approved tariff for various consumer categories considering gradual reduction in cross-subsidy in line with the requirement of Tariff Policy. As seen from the table below, tariff as a percentage of average cost is moving towards the band of 20% of average cost of supply as suggested in Tariff Policy. The average Tariff as a percentage of average cost of supply approved in Tariff Order for FY 2011-12 and that approved in the Tariff Order for FY 2012-13 is as shown in the table below.
Table 152: Cross-Subsidy in FY 2011-12 & FY 2012-13 FY 2012-13 approved by FY 2011-12 (As per T.O. FY 2011-12) Commission % of Average Cost of % of average Average Cost of average Realization Service cost Realization Service cost 2.36 5.62 42% 1.59 5.50 29% 1.88 3.35 2.74 NDS I NDSII 2.50 6.85 5.62 5.62 5.62 5.62 5.62 33% 60% 49% 44% 122% 1.88 3.59 2.86 2.32 7.24 5.50 5.50 5.50 5.50 5.50 34% 65% 52% 42% 132%
Sl.
Particular
1 2 3 4 5 6 DS
Kutir Jyoti DSI D.S. II
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FY 2012-13 approved by Commission 3.44 5.50 6.95 1.15 5.63 3.57 5.94 6.69 6.24 7.14 7.14 6.63 5.79 5.93 6.54 6.12 5.78 3.81 5.78 5.91 4.55 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50 5.50
Sl. 7 8 9 10. 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26
Particular NDS III NDS Irrigation IAS I Irrigation IAS II Irrigation L.T.I.S.I L.T.I.S.II LT Industrial Public Water work PWW Street lightI (Metered) Street light II (Unmetered) Street Light H.T.S.I H.T.S.II H.T.S.III H.T.S.S. HT R.T.S. Total
FY 2011-12 (As per T.O. FY 2011-12) 3.66 6.61 1.30 2.44 1.69 5.51 6.12 5.67 4.22 4.22 4.03 3.45 3.51 5.59 5.37 5.15 3.77 4.80 5.29 4.06 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 5.62 65% 118% 23% 43% 30% 98% 109% 101% 75% 75% 72% 61% 62% 99% 96% 92% 67% 85% 94% 72%
62% 126% 21% 102% 65% 108% 122% 113% 130% 130% 120% 105% 108% 119% 111% 105% 69% 105% 107% 83%
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7 Government grant/ revenue subsidy
7.1 7.1.1
Background The Bihar Electricity Regulatory Commission has till date issued Tariff Orders for FY 2006-07, FY 2008-09, FY 2010-11 and FY 2011-12. The year-wise amount of revenue grant/ Subsidy received from the State Government and its treatment by the Commission in the previous Tariff Orders is indicated below:
Table 153: Details of Resource gap grant received from State Government
Financial Year FY 2006-07 FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11 FY 2011-12
Amount of Govt. Grant* (Rs. Cr.) 720 720 720 840 1080 1080 (Provisional)
Remarks
The Commission has used the State Government resource gap grant to reduce the net ARR of BSEB so as to provide subsidized tariff to all consumer categories.
* : As per audited annual accounts
7.2
BSEB proposal and BERC approach toward Grant/ Revenue Subsidy from State Government in tariff petition BSEB since its first ARR and tariff petition for FY 2006-07 and till the ARR and tariff petition filed for FY 2011-12 has proposed the revenue resource gap from the State Government to bridge the total revenue gap in the ARR and thus subsidising the consumers in the State. The Commission had also aligned its approach with the suggestion of the licensee and accordingly has been passing on the benefit of the resource gap received from the State Government to the consumers in its Tariff Orders till FY 2011-12 to provide benefit to all the consumers by reducing the revenue gap of the Board as well as to reduce the average cost of supply to the extent of the support/ subsidy being provided.
7.2.1
7.3
Clarification on the treatment of State Government Grant/ Revenue Subsidy
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7.3.1
The letter from State Government received in the past in this regard also did not mention the priority of usage of the fund, the earlier letters received from State Government had only specified that the support is being made for payment of dues of NTPC against power purchase. Energy Department, Govt. of Bihar vide letter dated 19/9/11 communicated to the Commission regarding its decision on the priority of use of the resource gap funding provided by the Govt. to BSEB. The letter outlined that the State Government grant will be used to compensate the financial losses caused to BSEB on account of additional power purchase due to difference in the actual T&D loss and the T&D loss as determined/ approved by the Commission and the remaining portion of the grant will be used as subsidy to agriculture and rural consumers.
7.4
BSEB proposal and BERC approach toward Grant/ Revenue Subsidy from State Government in true-up process BSEB in its true-up petitions, for the period of FY 2006-07 to FY 2008-09, FY 200910 and FY 2010-11 filed on 1st Sep11, 13th Oct11 and 15th Nov11 respectively, has requested the Commission to treat the resource gap funding to first use/ compensate BSEB for meeting the losses suffered by BSEB on account of expenditure accruing due to difference in actual T&D loss of BSEB vis--vis T&D losses allowed by the Commission and consider the balance amount, if any, as subsidy to agriculture and rural consumers of BSEB. For this, BSEB has referred to letter dated 19/9/2011 received from the Energy Department, Government of Bihar, regarding the treatment of resource gap grant received from the State Government.
7.4.1
7.4.2
The Commission has observed that the resource gap grant received from the State Government has always been proposed by BSEB to be used for reducing the net revenue gap. This has the effect of reducing the net deficit in the ARR and thus reducing the average cost of supply of electricity and subsidising all categories of consumers in the state. Accordingly, the Commission has also been passing the benefit of the resource gap grant received from the State Government to all categories of consumers in its Tariff Orders issued upto FY 2011-12. The letter from State Government received in the past in this regard also did not mention the priority of usage as outlined in the latest letter of State Government dated 19/09/11. The earlier letters received from State Government have only specified that the support is being made available for payment of dues of NTPC against power purchase.
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7.4.3
The Commission in the True-up order for FY 2006-07 to FY 2008-09 has stated as under: the Commission does not agree with the request of the Board to adjust the dis-allowed power purchase expenses in the resource gap funding and then use the remaining amount for subsidising the consumers. The Commission retains the Government of Bihar Grant / Revenue subsidy amount for FY 2008-09 at Rs.720 Cr. as approved during the review. The revenue gap for the FY 2008-09 will be computed considering the same.
7.4.4
The Commission is of the view that letter from State Government after the issue of Tariff Orders cannot be used to withdraw the effect of government grant already passed on the consumers on a retrospective basis. Therefore, the Commission has not considered the BSEB proposal for post-facto adjustment of the revenue resource gap during the truing up exercise for FY 2006-07 to FY 2010-11. The Commission is of the view that the same approach would be continued while truing-up of ARR for FY 2011-12, since the Tariff Order for FY 2011-12 had already been issued before such decision was taken by the State Government.
7.5
Treatment of Grant/ Revenue Subsidy from State Government from FY 2012-13 onwards As the letter from State Government was received on 19th Sep 2011 i.e. before the approval of ARR and Tariff Order for FY 2012-13, the Commission is of the opinion that the treatment of the resource gap grant received from State Government should be in line with the policy decision taken by State Government on utilisation of resource gap grant. Accordingly, while approving the ARR and Tariff Order for FY 2012-13, the treatment of resource gap grant received from the State Government is as per the priority set by Energy Department, Government of Bihar vide letter no. 4208 dated 19/09/11. Accordingly, the State Government grant has been used to compensate the financial losses caused to BSEB on account of additional power purchase due to difference in the actual T&D loss and the T&D loss as determined/ approved by the Commission and the remaining portion of the grant has been used as subsidy to agriculture and rural consumers.
7.5.1
7.5.2
Further, the State Government again clarified during the meeting with the BSEB and Commission held 19th March2012 that the subsidy would be only for agriculture and
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rural consumers, subject to maximum of Rs. 1080 Cr.. The consumer categories which are considered by the Commission for subsidy support are as indicated below:
Table 154: Subsidised categories in Tariff Order for FY 2012-13
Sl.
Name of Subsidized Category
Applicability This will be applicable to (i) all huts (Kutir) and dwelling houses of rural and urban families below the poverty line (BPL) (ii) houses built under schemes like Indira Awas Yojana and similar such schemes for BPL families. This is applicable to domestic premises in rural areas for a load upto 2 kW not covered by areas indicated under DSII and not being fed from urban / town feeders. Applicable to loads upto 2 kW in rural areas not covered by areas indicated under NDS II and not being fed from urban / town feeders. Applicable for supply of electrical energy for bonafide use for agricultural purposes including processing of Agricultural Produce, confined to chaff cutter, thrasher, cane crusher and rice Huller when operated by the agriculturist in the field or farm and does not include rice mills, flour mills, oil mills, dal mills or expellers. This is also applicable to hatcheries, poultries (with more than 1000 birds) and fisheries (fish ponds) also including private tube wells.
Kutir Jyoti (KJ)
Domestic I: Rural (DS I) Non- Domestic I: Rural (NDS- I)
Irrigation and Agricultural Pump sets I (IAS I)
7.5.3
Unlike earlier Tariff Orders issued by the Commission, wherein the grant available from the State Government was treated for the purpose of reducing in the ARR and thus reducing the average cost of supply of electricity and subsidising all categories of consumers in the state, in the Tariff Order for FY 2012-13, due to change in the policy stand of State Government only the above mentioned four (4) categories will be subsidised.
7.5.4
The Commission has worked out the subsidy support on the above listed consumer categories to compensate the BSEB to the extent of the difference between the average Cost of Supply and the average tariff for the respective categories.
7.6
Mechanism for determination and recovery of Government subsidy support to Agriculture/ Rural consumers In view of the State Governments decision to compensate on the Agriculture and other Rural consumer categories and to encourage the BSEB to improve upon its metering and billing related activities, the Commission outlines the process for determination and recovery of Government subsidy support to Agriculture/ Rural consumers on units billed basis.
7.6.1
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7.6.2
The difference between the approved average CoS and the actual monthly average tariff for the power sold to Agriculture/ Rural consumers shall form the basis for determination and recovery of subsidy by the BSEB from the State Government on a monthly basis.
7.6.3
The subsidy support for Agriculture/ Rural consumers on the approved sales/ ARR for FY 2012-13 as worked out by the Commission is as provided in the table below:
Table 155: Subsidy receivable from State Government for FY 2012-13
Sl. 1 1 2 3 4 5
Name of Subsidized Category Kutir Jyoti (KJ)-Rural Kutir Jyoti (KJ)-Urban Domestic I: Rural (DS I) Non- Domestic I: Rural (NDS- I) Irrigation and Agricultural Services-I: (IASI) Total subsidy receivable from State Govt.
Average Tariff (Rs,/ Unit) 1.59 1.87 1.88 2.32 1.15
Averag e CoS (Rs,/ Unit) 5.50 5.50 5.50 5.50 5.50
Units Sold (MUs) 455.94 1.46 1,047.74 22.15 271.63
Subsidy Amount (Rs Cr.) 178.36 0.53 379.81 7.05 118.15 683.90
7.6.4
Based on the approved ARR and tariff for FY 2012-13, Rs 683.9.Cr. will be received by BSEB as subsidy from the State Government as subsidy support to BSEB on sales of power to Agriculture/ Rural consumers.
7.6.5
Further to the above, any FPPCA charges applicable during any month of FY 201213 should be added on to the CoS approved for the year in this Tariff Order for determination of subsidy support to the Agriculture/ Rural categories.
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8 Tariff Principles, Design and Tariff Schedule
8.1 8.1.1
Background The Commission in determining the Aggregate Revenue Requirement (ARR) and the retail tariff of BSEB for the FY 2012-13 has been guided by the provisions of the Electricity Act 2003, the National Electricity Policy 2005 (NEP), the Tariff Policy 2006 (TP), Regulations on Terms and Conditions for Determination of Tariff issued by the Central Electricity Regulatory Commission (CERC) and BERC (Terms and Conditions for Determination of Tariff) Regulations, 2007. Section 61 of the Act lays down the broad principles, which shall guide determination of retail tariff. As per these principles the tariff should progressively reflect cost of supply and also reduce cross subsidies within the period to be specified by the Commission. The Act also lays special emphasis on safeguarding consumer interests and also requires that the costs should be recovered in a reasonable manner. The Act mandates that tariff determination should be guided by the factors, which encourage competition, efficiency, economical use of resources, good performance and optimum investment.
8.1.2
The NEP aims at increased access to electricity, supply of reliable & quality power at reasonable rates, minimum life line consumption, financial turnaround & commercial viability of electricity sector and protection of consumers interest. The Commission has considered factors as far as possible which aim at achieving the objectives of NEP while determining the revenue requirement of BSEB and designing the retail tariff for its consumers.
8.1.3
The TP notified by Government of India in January 2006 provides comprehensive guidelines for determination of tariff and revenue requirement of power utilities. The Commission has endeavored to follow these guidelines as far as possible.
8.1.4
The Electricity Act, 2003 requires consideration of Multi Year Tariff (MYT) principles and TP also mandates that the MYT framework be adopted for determination of tariff from 1st April 2006. The BERC (Terms and Conditions for determination of tariff)
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Regulations, 2007 provide the MYT framework to be made applicable to BSEB from the date to be notified by the Commission. However the Commission did not introduce MYT regime in the State immediately but decided to defer its applicability till FY2012 -13 because of lack of requisite and reliable operational and financial data. However the Commission would admit that till date the ground work necessary for providing adequate data and improving the quality and reliability of existing data for implementing MYT from FY2012-13 has not yet been done by BSEB. The Commission shall take appropriate action to introduce MYT in the State as envisaged in its regulations. 8.1.5 The Tariff Policy mandates that tariff should be within 20% of the average cost of supply by FY2010-11 and requires Commissions to lay down a road map for reduction of cross subsidy. However, the Commission while designing the retail tariffs for FY2012-13 has taken into consideration the existing level of cross subsidies, the need to reduce cross subsidies as required under the TP and the feasible pace at which it can be done without giving a tariff shock to subsidized consumers. The Commission has accordingly modified tariffs for consumer categories whose existing tariffs are lower/higher than the average cost of supply so that the retail tariffs of all such consumer categories move closer to the band of 20% of the average cost of supply. The Commission for this purpose has computed the average cost of supply on the basis of the revenue requirement allowed and the sale approved by the Commission for FY2012-13. Further the Commission has also considered the need to (i) rationalize consumer categories & sub categories so that consumers with similar load profile are considered together (ii) rationalize minimum charges (MC) giving due consideration to hours of supply provided by BSEB (iv) encourage Demand Side Management (DSM) by making the option of two part tariff attractive for consumers (v) encourage ToD tariff for DSM in the State (vi) reflect quality and reliability of supply aspects in tariffs (vii) appropriate slab wise tariff. The Commission believes that consideration of these factors will result in tariffs becoming more cost reflective and equitable as consumers would be required to pay tariffs according to the cost incurred by BSEB in supplying electricity to them. 8.2 8.2.1 Tariff changes proposed by BSEB BSEB in its tariff petition for FY 2012-13 has proposed revision of retail tariffs of various consumer categories to earn additional revenue of Rs.1757.11 Cr. leaving a gap of Rs. 6581.31 Cr. to be recovered as regulatory assets in subsequent years.
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However on detailed scrutiny and application of prudency check on the aggregate revenue requirement filed by BSEB, the Commission has arrived at a more realistic aggregate revenue requirement of Rs 4747.22 Cr. for FY 2012-13. The Commission has therefore allowed an average tariff increase of 12.1% as against 57% increase sought by BSEB. This will result into additional revenue of Rs. 1032 Crores leaving a gap of Rs. 157.3 Crores as regulatory asset. The average cost of supply approved by the Commission is Rs. 5.5 per unit against Rs. 6.37 per unit proposed by BSEB. State Government tariff subsidy of Rs. 683.90 Crores has been considered for subsidising the rural domestic, commercial and agricultural consumers to retain their tariff at existing level of FY 2011-12. 8.2.2 In the tariff proposal, BSEB has proposed (i) Creation of new tariff category for HT consumers seeking construction power at HT voltage levels for their plants, (ii) (iii) 8.2.3 Creation of new sub-categories within existing tariff categories Change in existing terms and conditions of tariff.
The proposed increase in tariff by BSEB would result in an overall increase of about 57% against existing retail tariffs.
8.3 8.3.1
Changes in existing tariff categories/sub-categories proposed by BSEB Changes in the existing tariff categories/ sub-categories proposed by BSEB are given in brief below:
Sl. A. 1.0 1.1
Existing
Proposed by BSEB for FY 2012-13 LOW TENSION SUPPLY
DOMESTIC SERVICES (DS) Kutir Jyoti BPL Consumers Kutir Jyoti (Rural) Load upto 60W Kutir Jyoti BPL Consumers Kutir Jyoti (Rural) Load upto 60W - Unmetered - Metered Kutir Jyoti - (Urban) Load upto 100 W - Metered
(i)
- Unmetered - Metered
(ii)
Kutir Jyoti - (Urban) Load upto 100 W - Metered
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Sl.
Existing DS-I (Connected load upto 2 kW)
Proposed by BSEB for FY 2012-13 DS-I (Connected load upto 2 kW) - Unmetered - Metered DS II (Metered) - Single Phase Upto 5 kW - Three Phase 5 kW and above DS-II (D) (Optional) Demand Based Tariff (Contract demand of 5 kW to 60 kW) DS - III (Metered) Domestic Service (Temporary connection for a max. duration of 6 months) - DS (T)
1.2
- Unmetered - Metered DS II (Metered)
1.3
- Single Phase Upto 5 kW - Three Phase 5 kW and above
1.3.1 1.4
DS-II (A) (Optional) Demand Based Tariff (Contract demand of 5 kW to 60 kW) DS III (Metered)
1.5
N/A
- Unmetered - Metered
(New sub-category proposed)
2.0
NON DOMESTIC SERVICES (NDS) NDS-I (Load upto 2 kW in Rural area) NDS-I (Load upto 2 kW in Rural area) - Unmetered - Metered NDS II (Metered) (Load upto 60 kW in urban Area & Load above 2 kW in Rural Area) - Single Phase upto 5 kW - Three Phase for 5 kW & above NDS II (D) (Optional)-Demand Based Contract demand of 5 kW upto 60 KW NDS III (Metered) Upto 30 kW NDS III (D) -Demand Based of 5 kW and upto 30 kW NDS IV Commercial Advertisement for hoardings
2.1
- Unmetered - Metered NDS II (Metered)
2.2
(Load upto 60 kW in urban Area & Load above 2 kW in Rural Area) - Single Phase upto 5 kW - Three Phase for 5 kW & above
2.2.1 2.3 2.3.1
NDS II (A) (Optional)-Demand Based Contract demand of 5 kW upto 60 KW NDS III (Metered) Upto 30 kW NDS III(A) -Demand Based of 5 kW and upto 30 Kw N/A
2.4
2.5
N/A
Non-Domestic Service (Temporary connection for a max. duration of 6 months) - NDS (T) - Unmetered - Metered
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Sl.
Existing
Proposed by BSEB for FY 2012-13

3.0 3.1
IRRIGATION AND AGRICULTURAL SERICES (IAS) IAS I Unmetered supply IAS I Unmetered supply - Rural feeder - Urban feeder Metered supply - Rural feeder - Urban feeder IAS II (State Tube wells / state Lift Irrigation Pumps / State Irrigation pumps upto 100 HP) Unmetered supply - Rural feeder - Urban feeder Metered supply - Rural feeder - Urban feeder
(i)
- Rural feeder - Urban feeder Metered supply
(ii)
- Rural feeder - Urban feeder
3.2
IAS II (State Tube wells / state Lift Irrigation Pumps / State Irrigation pumps upto 100 HP) Unmetered supply
(i)
- Rural feeder - Urban feeder Metered supply
(ii)
- Rural feeder - Urban feeder
4.0 4.1 4.1.1 4.2
LOW TENSION INDUSTRIAL SERVICE (LTIS) LTIS I (Connected load upto 25 HP) 4.1: LTIS (Connected load upto 99 HP) LTIS-I (A) Optional- Demand based TariffContract demand 5 kW and upto 15 kW LTIS II Connected load Above 25 HP and upto 99 HP LTIS II (A) Optional-Demand based TariffContract Demand above 15 kW and upto 60 kW
(Proposed merger of LTIS I and LTIS II)
4.2.1
4.1.1: LTIS (D) Demand based Tariff(Compulsory for all new three phase LTIS consumers)
LTIS (Temporary connection for a max. duration of 6 months) - LTIS (T) 4.3 N/A - Unmetered - Metered
5.0
PUBLIC WATER WORKS (PWW)
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Sl. 5.0
Existing PWW Connected Load upto 99 HP
Proposed by BSEB for FY 2012-13 PWW Connected Load upto 99 HP

(Proposed as 5.1)
PWW (Temporary connection for a max. duration of 6 months) - PWW (T) 5.2 N/A - Unmetered - Metered
6.0
STREET LIGHT SERVICES (SS) SS I (Metered) SS I (Metered) - Gram Panchayats - Nagar Palika / NAC / Municipality - Municipal Corporation SS II (Unmetered) - Gram Panchayats - Nagar Palika / NAC / Municipality - Municipal Corporation HIGH TENSION SUPPLY HTS I 11 kV/ 6.6 kV Supply Installations having contract demand of 75 kVA to 1500 kVA 11 kV/ 6.6 kV Supply Installations having contract demand of 75 kVA to 1500 kVA
6.1
- Gram Panchayats - Nagar Palika / NAC / Municipality - Municipal Corporation SS II (Unmetered)
6.2
- Gram Panchayats - Nagar Palika / NAC / Municipality - Municipal Corporation
B. 7.1
7.2
HTS II 33 kV Supply Installations having contracted demand of 1000 kVA to 10000 kVA 33 kV Supply Installations having contracted demand of 1501 kVA to 10000 kVA
(New range of Contract demand proposed)
7.3
HTS III 132 kV Supply Installations having contracted demand of 7.5 MVA and above 132 kV Supply Installations having contracted demand of 10 MVA and above
(New range of Contract demand proposed)
7.4
HTSS Induction furnace including Ferro Allow loads (11 kV & 33 kV) Induction furnace including Ferro Allow loads (11 kV & 33 kV)
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Sl. 8.0
Existing RAILWAY TRACTION RTS (At 132 kV supply) RTS (At Lower than 132 kV supply)
Proposed by BSEB for FY 2012-13
RTS (At 132 kV supply or above) RTS (At Lower than 132 kV supply)
9.0
TEMPORARY SUPPLY (LT & HT) 10.0: Temporary connection for a period of Temporary connection for a period of less
less than six (6) months.

(New duration proposed for temporary category)
than one year.

10.0 SEASONAL SUPPLY (LT & HT)
No change has been proposed in seasonal supply tariff category 11.0 CONSTRUCTION POWER 9.0: Construction Power for supply at 11kV and above for construction or fabrication of plants
(New category proposed)
N/A
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8.4 8.4.1
Changes in tariff category and tariff schedule approved by the Commission In this section the Commission has analyzed changes in tariff categories/subcategories and other conditions of schedule proposed by BSEB and accordingly either approved or disapproved them. The Commission in the first instance has commented on changes proposed by BSEB which are common to most of the consumer category. Creation of new tariff Category Construction Power Petitioners submission
8.4.2
BSEB has proposed the creation a new tariff category for HT consumers seeking construction power at HT voltage levels for their plants. This tariff category is proposed to be applicable to all such consumers who avail supply for construction or fabrication of plants at 11 kV and above. Commissions view
8.4.3
The Commission is of the view that there is already provision for providing connections at HT voltage levels for the purpose of construction/ fabrication works with respect to plants as per Clause 4.63 of the BERC (Bihar Electricity Supply Code), 2007. Accordingly, the proposal of the BSEB for creation of a separate category for HT consumers seeking construction power at HT voltage levels for their plants is being rejected. Creation of new sub-categories within existing tariff categories Petitioners submission
8.4.4
Temporary Category: Consumers seeking temporary connections for electricity usages under Domestic Service, Non-Domestic Service, Low Tension Industrial service, Public Water works and HT category will be eligible. Applicability of the temporary connection is restricted to certain categories only as compared to existing structure where all consumers are eligible. Temporary connection is proposed to be provided as unmetered connection and metered connection for LT category of consumers while HT category of consumers will get metered connection only. The creation of unmetered temporary category under these categories has been
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necessitated on account of consumers seeking temporary connections for (i) Melas, Festivals & Exhibitions (ii) Puja Pandals (iii) Marriages and other religious/social functions and (iv) For providing civic amenities during other social, political, cultural and industrial functions of purely temporary nature etc. The fixed charges and minimum energy charges have been proposed on per day basis taking into account the limited period for which these connections are sought. The proposal for fixed/demand and energy charges is nearly two times the highest slab of the energy and fixed/demand charges applicable to consumers with permanent connection under that tariff category. This has been done to account for the increased cost of power purchase and inability of licensee to recover the same under FPPCA charges from temporary consumers at subsequent date. No FPPCA charges are proposed to be levied on these categories of consumers due to the temporary nature of the connections. The maximum period for which these connections can be availed is proposed to be six months from existing level of 1 year. The other terms and conditions would be as applicable to the respective tariff category. Commissions view 8.4.5 The Commission is of the view that there is already provision for providing temporary connections under the existing consumer/ tariff categories as per Clause 4.63 of the BERC (Bihar Electricity Supply Code), 2007. Accordingly, the proposal of the BSEB for creation of a separate tariff subcategories for temporary installations under the above mentioned tariff categories is being rejected. Petitioners submission 8.4.6 NDS-IV: BSEB has proposed introduction of new sub-category (NDS-IV) under the existing NDS tariff category for electricity used for the purpose of exclusive commercial advertisements for hoardings and other similar connections by/through advertising agencies. This category has been proposed due to its separate & distinct nature of use of electricity and need to regulate such category of consumers in appropriate way. Commissions view 8.4.7 The Commission is of the view that efficacy and implication of the separate tariff category exclusively for commercial advertisements/ hoardings needs to be analysed
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in detail before any decision is taken for inclusion of a separate sub-category. The BSEB has not even projected the number of consumers, connected load and sales separately for the proposed sub-category for enabling analysis of separate tariffs for such sub-category. Therefore, the proposal for creation of a separate sub-category exclusively for commercial advertisements/ hoardings is being rejected. The BSEB is directed to propose such changes in tariff categories only after providing detailed information required for undertaking assessment of the efficacy of such measures. Petitioners submission 8.4.8 LTIS (Demand Based Tariff): All new consumers under Three Phase LTIS shall come under this tariff category only. Corresponding changes (necessitated on account of merger of LTIS-I and LTIS-II) have been proposed for this tariff subcategory. BSEB would like to encourage its consumers to opt for this subcategory as this would do away with the requirement for computation of connected load. The Consumer would be required to pay according to demand imposed on the system rather than on the basis of connected load. However, existing consumers under LTIS-I & LTIS-II tariff shall have option to continue under LTIS category. Commissions view 8.4.9 Firstly, the LTIS-I and LTIS-II represent different sizes of industrial consumer with different consumption pattern, loading requirement and paying capacity. Thus, the tariff for the two categories cannot be merged unless the tariff implication of such merger on the consumers pertaining to the two categories is analysed in detail. Hence the Boards proposal is being rejected. Change in existing terms and conditions of tariff for LT and HT consumers Petitioners submission 8.4.10 LT Consumers - Change in nomenclature of demand based tariff category: BSEB has proposed change in the nomenclature of demand based tariff category from sub-category name (A) to sub-category name (D). Its easy to identify category with nomenclature of D for demand based tariff. Commissions view
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8.4.11 The Commission accepts the change in nomenclature for denotation of demand based tariff as proposed by the Board. Petitioners submission 8.4.12 Monthly Minimum Charges: BSEB has proposed increase in the MMC for DS-I (Metered), DS-II (Metered), DS-III (Metered), LITS (D) and IAS-I (Metered) keeping in view the increased hours of supply and increase in specific consumption of these consumer categories. This has also been done to ensure reasonable recovery of fixed charges incurred by BSEB which is not being recovered fully. For FY 2012-13, BSEB has proposed total ARR of Rs. 7898.13 Crores out of which Rs. 2600.51 Crores are of fixed nature while Rs. 5297.61 Crores will be used for power purchase and fuel cost of own generation. Currently, BSEB is able to recover only 27% & 40% of fixed costs from demand/fixed charges based on the existing tariff & proposed tariff respectively. In such scenario, it is very much necessary to levy MMC on consumers so that BSEB can at least recover its fixed cost. Commissions view 8.4.13 The Commission is of the view that since two-part tariff has already been introduced in almost all consumer categories (except KJ, DS-I and IAS-I) in the State, there is no need for monthly minimum charges to be levied, provided the BSEB is able to efficiently undertake metering/ billing activities. The Commission urges the BSEB to meter all un-metered consumers on priority and bill them on actual consumption as per applicable tariff without depending on Monthly Minimum Charges. The Commission intends to gradually phase out the MMC in all consumer categories in its future tariff orders. Petitioners submission 8.4.14 Option to change to HTS-I category: BSEB has proposed that LTIS and PWW consumers having connected load of more than 79 HP to 99 HP may avail supply under HTS-I category at 11 kV. By doing so, both the parties (consumer and BSEB) will get benefit. Consumers receive better quality and reliability of supply whereas BSEB is able to control its losses and system overloading. Commissions view
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8.4.15 The Commission is not clear on the intent of the BSEB in its proposal. The Option for billing under HTS category for LTIS-II and PWW consumers with a connected load between 79 HP to 99 HP has already been provided for in the previous tariff order for FY 2011-12. Petitioners submission 8.4.16 The LT terms and conditions of tariff require LT consumers whose connected load includes motors of 3 HP and above to install shunt capacitors at the motor terminals for maintaining power factor at 90% and above. BSEB proposes to exclude domestic consumers and single phase non-domestic consumers from the applicability of this clause of the tariff condition as such consumers do not have the knowledge to compute the capacity of capacitor required and wherewithal to maintain required capacitors. Commissions view 8.4.17 The Commission is of the view that installation of capacitors of requisite rating/ capacity is essential for maintaining good power factor and a stable and healthy distribution network. Further, the aggregate impact of installations having motors of 3 HP and above would be immense on the system. It is the duty of the Board to educate and create awareness amongst its consumers for making such initiatives a success. In view of this the Boards proposal is rejected and the Board is directed to take necessary steps for effective implementation of installation of capacitors of requisite ratings at consumer installations. The installation of shunt capacitors shall be done in accordance with in Chapter 6 of the BERC (Bihar Electricity Supply Code), 2007. This being a matter related to the Supply Code, in case any amendment is felt necessary by the Petitioner, the same may be taken up separately. Petitioners submission 8.4.18 Applicable to both LT and HT Consumers - Delayed Payment Surcharge (DPS): As per the existing terms and conditions, the consumer is required to pay surcharge on the entire principal amount even if the consumer has made partial payments. BSEB has proposed to replace the word principal with balance so that the consumers who pay partial bill amount will be required to pay DPS on the remaining
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amount and not the entire amount. This would incentivize consumers to pay their bills (even partial) and help BSEB in improving its cash collection. This change is being proposed for both LT and HT consumer categories. Commissions view 8.4.19 The charging of DPS shall be done in accordance with Clause 10.12 of the BERC (Bihar Electricity Supply Code), 2007. This being a matter related to the Supply Code, in case any amendment is felt necessary by the Petitioner, the same may be taken up separately however the Commission has considered and modified in the terms and conditions of supply. Petitioners submission 8.4.20 Additional of clause in Defective/ Damaged/ Burnt meters supply: A new clause has been added in the tariff schedule for defective/ damaged/ burnt meters supply as provided under: In case of newly installed meter of a consumer becoming defective/ damaged/ burnt after installation of meter and consumption of last 12 months is not available, the consumer shall be billed provisionally on the basis of MMC or the average consumption computed on the basis of past consumption whichever is higher. The final billing of the consumer for the period of provisional billing shall be done on the basis of average meter reading of the consumer for the subsequent 12 months after installation of healthy meter. Commissions view 8.4.21 The Commission has considered the proposal of the Board. The relevant terms and conditions shall be modified in the tariff schedule for LT consumers. Petitioners submission 8.4.22 Interest on Advance Payment: BSEB proposes to introduce interest on advance payment made by consumers on outstanding balance on month to month basis at Bank rate notified by RBI from time to time. This will encourage consumers to pay bills in advance which will help BSEB in better and timely recovery of revenues. This is proposed in line with clause no. 7.15 (2) of Bihar Electricity Supply Code. Commissions view
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8.4.23 The clause 7.15 (2) of the BERC (Bihar Electricity Supply Code), 2007 is in respect of security deposit. In view of the same the Petitioners proposal is not clear in its intent and is being rejected as of now. The Petitioner may take up the matter separately with the Commission. Petitioners submission 8.4.24 Grace Period: The provision for a grace period of 10 days for payment of bills has been done away with. The same has been proposed as the implementation of grace period not only distorts the revenue cycle of the BSEB but also causes problems in implementation of tariff as the billing software of BSEB does not have provision for the same. Commissions view 8.4.25 The Commission has introduced the grace period only after detailed deliberations with all stakeholders. Implementation is IT system related issue and can be effectively handled through appropriate interventions. Accordingly, the proposal of the Board is being rejected. Petitioners submission 8.4.26 Penalty for bounced cheque: BSEB has been encouraging consumers to pay bills through cheques as well. However it has been observed that some consumers have been misusing this facility. To curb this intentional misuse of this facility it is proposed that in case the cheque given by the consumer against the energy bills is dishonoured by the bank then a penalty will be payable by such consumer. Action against such consumers shall be taken as per clause 7.4 (h) and 10.9 of Bihar Electricity Supply Code. Clause 7.4 (h) and 10.9 of BERC which provides inter-alia 7.4.. (h) After a minimum period of seven days, incase of dishonouring of the cheque by the Bank (non-encashment of cheque) 10.9 In case of non-realisation of cheque, the licensee shall have right to increase the security deposit from the consumers. The licensee shall also have the right to take steps such as levying cheque dishonour charges or initiating other actions as per law besides insisting on future payment by demand draft or by cash.
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Commissions view 8.4.27 The clause 10.9 of the BERC (Bihar Electricity Supply Code), 2007 is in respect of non-realisation of cheque. In view of the same the Petitioners proposal is being rejected as of now. The Petitioner may take up the matter separately with the Commission. Petitioners submission 8.4.28 Supply Premium payable by consumers in notified areas: BSEB has proposed to procure additional power purchase in FY 2012-13 to improve the supply situation in Bihar. As directed by the Commission in its Tariff for FY 2011-12, BSEB has proposed a Supply Premium to be payable by consumers who receive additional hours of supply. It is proposed that BSEB intends to supply continuous power atleast for 600 hours in a month to all LT consumers except Kutir Jyoti & Agricultural and HTS-I consumers who lie in such areas. The continuous supply mean normal supply excluding the duration of grid failure, plant failure of power supplier, any force majeure condition, scheduled shut down, emergent breakdown and restriction of power supply by the Commission under section 23 of Electricity Act, 2003 will be required to pay 10% supply premium on demand/ fixed and energy charge and in MMC. Which provides inter-alia 23 Directions to Distribution Licensee: if the appropriate Commission is of the opinion that it is necessary or expedient so to do for maintaining the efficient supply, securing the equitable distribution of electricity and promoting competition, it may, by order, provide for regulating supply, distribution, consumption, or use thereof. Areas to which BSEB intends to supply electricity close to 600 (six hundred) hours will be notified by BSEB and the proposed Supply Premium will be levied after such notification. Commissions view 8.4.29 The Commission has already approved charging of premium tariff in notified areas where the Board is supplying close to 24 hours of supply. The Commission is of the view that it may be ensured that transmission and distribution network including other infrastructure required to ensure close to 24 hours supply to the notified areas are
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strengthened. Strenghthening of infrastructure may include interalia strengthening / replacement of weak conductors, transformers and other electrical equipments installed for supplying electricity to the notified areas, provision of appliances and sparesand keeping technical teams ready round the clock for rectifying defects leading to disruption of supply in these areas. A few telephones should be kept operational for each notified area which should be manned round the clock for receiving and responding to the complaints. These telephone numbers should be widely publicised in the newspapers for the information of general public. BSEB must ensure these steps for ensuring close to 24 hours supply of electricity to the notified areas. The Commission is not in favour of allowing any relaxation to the supply continuity measure approved for charring of such premium tariff. Accordingly, the proposal of the petitioner for levy of 10% premium on the basis of 600 hours of supply per month is being rejected and the Board has to supply close to 24 hours with the conditions as stated in the above para. Petitioners submission 8.4.30 Voltage surcharge: BSEB has proposed voltage surcharge on applicable energy and demand charges for consumers which receive supply at voltage levels lower than the applicable voltage levels. BSEB would like to penalize the consumers to receive supply at lower voltage levels. Receiving supply at lower voltage level is not beneficial to both consumers and BSEB. By taking supply at appropriate voltage level, Consumers receive better quality and reliability of supply whereas BSEB is able to control its losses (transformation and I2R losses) and system overloading. The surcharge will be symmetrical and will be 7.5% of the energy and demand charges applicable to tariff category to which the consumer belongs. This surcharge shall be applicable to: DS consumer category NDS consumer category LTIS consumer category PWW consumer category HTS - I and HTS - II consumer categories.
Commissions view
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8.4.31 The Commission in this tariff order has directed the Board to get a detailed Voltage wise Cost of Supply (CoS) study conducted. The Commission shall make the tariffs reflective of the voltage wise cost of supply on completion of such study. Therefore, as of now, the above proposal of the Board is rejected. Petitioners submission 8.4.32 Accounting of Partial payment: BSEB has proposed following order of priority for accounting of the partial payment made by the LT and HT Consumers Statutory taxes and duties Additional Security DPS on arrears Principal arrears Current bill
Commissions view 8.4.33 The Commission takes cognizance of the issue raised by the Petitioner. The relevant terms and conditions shall be modified in the tariff schedule. Petitioners submission 8.4.34 Applicable to HT Consumers - Reclassification of contract Demand: As per the existing tariff category classification, the HT consumer as per its contract Demand falls under the following tariff category: HTS- I: Consumers with contract demand between 75 KVA and 1500 kVA HTS-II: Consumers with contract demand between 1000 kVA and 10000 kVA HTS-III: Consumers with contract demand of 7.5 MVA
As evident from the above there is a significant overlap in the allowable contract demand. A consumer with 1000 kVA can seek connection both under HTS-I and HTS-II consumer categories. Similarly a consumer with contract demand of 7.5 MVA can seek connection both under HTS-II and HTS-III tariff categories. To remove this anomaly BSEB proposes following changes to the voltage range for applicable contract demand: HTS- I: Consumers with contract demand between 75 KVA and 1500 kVA
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HTS-II: Consumers with contract demand between 1501 kVA and 10 MVA HTS-III: Consumers with contract demand of more than 10 MVA
Further it is also proposed that the consumers who get affected because of this reclassification of contract demand can continue to avail supply at existing voltage levels. Commissions view 8.4.35 The Commission is of the opinion that in order to assess the efficacy and implication of the proposed reclassification of contract demand for the above mentioned categories needs to be analysed in detail before any such decision is taken. The BSEB has not even projected the number of consumers, connected load and sales separately for the proposed reclassified categories for enabling analysis of separate tariffs for such reclassifications. Therefore, the proposal for reclassifications under the said categories is being rejected. The BSEB is directed to propose such changes in tariff categories/ classifications only after providing detailed information required for undertaking assessment of the efficacy of such measures. Petitioners submission 8.4.36 MMC for HTS-I, HTS-II & HTS-III: BSEB proposes to restore minimum base energy charge calculation on monthly basis from revised methodology in last Tariff Order for FY 2011-12 dated 1st June, 2011. BSEB is purchasing additional power supply to fulfil the requirement of the consumers and hence it is necessary that consumer avails minimum level of energy during the month. The Honble Commission has introduced calculation of minimum base energy charge on annul basis in view of the shortage in the power supply. Now, BSEB is purchasing additional power to meet requirement of the consumers and giving enhanced power supply to all such consumers. BSEB should be compensated for non-availment of supply by the consumers. This has also been done to ensure reasonable recovery of fixed charges incurred by BSEB which is not being recovered fully. For FY 2012-13, BSEB has proposed total ARR of Rs. 7898.13 Crores out of which Rs. 2600.51 Crores are of fixed nature while Rs. 5297.61 Crores will be used for power purchase and fuel cost of own generation. Currently, BSEB is able to recover only 27% & 40% of fixed costs from demand/fixed charges based on the existing tariff & proposed tariff respectively.
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In such scenario, it is very much necessary to levy MMC on consumers so that BSEB can at least recover its fixed cost. Hence, it has become necessary for BSEB to seek restoration of minimum base energy charge calculation on monthly basis. Commissions view 8.4.37 The Commission is of the opinion that since two-part tariff has already been introduced for HTS consumers in the State, there is no need for monthly minimum charges to be levied, provided the BSEB is able to efficiently undertake metering/ billing activities. The Commission has done away with MMC on HTS consumers in this tariff order for FY 2012-13. The Commission intends to gradually phase out the MMC in all consumer categories in its future tariff orders. Petitioners submission 8.4.38 Power factor rebate: BSEB has proposed changes in the existing provision for levy of power factor rebate. The consumer would be required to maintain average monthly power factor of the supply between 0.90 and 0.95. The consumer will be entitled to receive rebate at rates indicated in the table below:
Range of power factor For each increase of 0.01 in power factor above 0.95 Proposed power factor rebate 0.5 (zero point five) percent on demand and energy charges (Actual recorded)
However if the monthly power factor falls below 0.90 the existing provisions for levy of surcharge will be applicable; Commissions view 8.4.39 The Petitioner has not provided any reasoning for the above proposed changes in the power factor rebate being allowed to consumers. In view of the same the proposal is rejected. Petitioners submission 8.4.40 Transformer Capacity: BSEB proposes insertion of additional clause in transformer capacity. The proposed change is as shown below:
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Such cases shall be dealt as per the provisions of Bihar Electricity Supply Code, 2007. The contract demand of such HT consumer, except RTS consumers, shall be revised to 2/3 of the transformer capacity. For RTS consumer, contract demand shall be revised to 1/ 2 of the transformer capacity. Commissions view 8.4.41 The Commission is of the opinion the contract demand cannot be directly linked with the transformer capacity and consumers must be provided with enough flexibility to install transformers in view of their expected future demand. Since the metering for such connections is already being done on the HT side, the consumer bears the excess burden of technical losses and does not harm the Board in any way. The board may avoid any potential misuse by improving upon its metering system and keeping increased vigil on such consumers. Accordingly, the prayer of the Board regarding linking of contract demand to the capacity of the transformer installed for HT connections is being rejected. Petitioners submission 8.4.42 Cap on Overall Rebates: BSEB proposes cap on overall rebates admissible to consumer at 4% to limit the revenue outflow. This will help in reduction of revenue gap. Commissions view 8.4.43 The Petitioner has not provided any reasoning for the above proposed changes in overall rebates being allowed to consumers. It is not understood that if any rebate is being provided in lieu of efficiency levels being maintained by consumers or the voltage at which he is drawing supply and is reflective of the actual cost of supply to such consumers why the same should be withdrawn or limited. In view of the same the proposal is rejected. Petitioners submission 8.4.44 Withdrawal of rebate: In order to incentivise HT consumers for timely payments of their bills. It is proposed that the consumer will not be entitled to claim any rebate under any head in case of default of payment by the due date. Commissions view
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8.4.45 There is already the provision of Delayed Payment Surcharge for encouraging consumers to pay their bills on time. The rebates being offered may be due to efficiency levels or voltage at which any such consumer is connected and is therefore essential in passing on the benefits of lower cost of supply to such consumers and the same is independent of the timeliness of his payment of electricity bills. Therefore, the proposal of the Petitioner is rejected. Petitioners submission 8.4.46 Miscellaneous & General Charges: BSEB has proposed revisions in existing miscellaneous charges in view of increase in cost of material and labour. Commissions view 8.4.47 The Commission takes cognizance of the issue raised by the Petitioner. The relevant miscellaneous and general charges shall be modified in the tariff schedule. Petitioners submission 8.4.48 Charges for Tatkal Connection: BSEB in the past has received numerous requests from its consumers for providing tatkal connections. In view of this facility demanded by its consumers, BSEB proposes this scheme under which all consumer categories other than High Tension and Railway may avail benefit of this scheme. The General and Miscellaneous charges for the Tatkal connection will be 2 (Two) times of the charges approved under the head general and miscellaneous charges. The connection under this scheme shall be released by BSEB in half the time limit prescribed by the Commission in the Supply Code from the date of completion of prescribed procedural formalities and payment of applicable fees and charges. In case BSEB fails to release connection within this time limit, BSEB will refund the additional amount claimed to the consumer in the first energy bill. Commissions view 8.4.49 The Commission approves the Boards proposal regarding the release of tatkal connection to all consumer categories other than High Tension and Railway with the following conditions: Additional option to the consumers
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The Tatkal connections shall be released by BSEB in half the time limit prescribed in the Supply code for that consumer category. Two (2) times of the following charges approved under head miscellaneous and general charges will be taken from the consumers willing to avail tatkal connection: o o Application fees for new connection, and; Supervision, labour and establishment charge for service connection
In case BSEB fails to release connection within this time limit, BSEB will refund the additional amount claimed to the consumer in the first energy bill.
Petitioners submission 8.4.50 Development charges & one time application processing charge: BSEB has proposed development charges as compensation for time and effort spent by it in processing the application submitted by prospective consumers for release of new connections. All applicants for new connections under different tariff categories will be required to pay one time application processing charges in lumsump in order to generate additional source of income to BSEB to bridge the revenue gap. Commissions view 8.4.51 The Commission is of the opinion that the Board is obliged to supply power under Section 43 of the Electricity Act 2003 and therefore charging of Development charges is not justified and proper. The Commission appreciates that the Board needs to do a lot to improve quality of service to the consumers particularly in respect of release of new connections. Accordingly, the proposal of the Petitioner related to charging development charges and one time application processing charges to the consumers is being rejected.
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8.5
Category/Sub-category wise changes proposed by BSEB and approved by the Commission are discussed in respective sections. Domestic Service (DS) Petitioners submission
8.5.1
BSEB has proposed the following changes for this consumer category: Supply premium payable by consumers in notified areas To charge Kutir Jyoti Consumer having consumption in any month in excess of 30 units at mentioned tariff rates. However, if the maximum consumption upto 360 units is detected during period of preceding 12 months, such consumers will then be treated as DS-I or DS II consumer as the case may be. Provisions of tariff slabs for KJ consumers for consumption of more than 30 units Introduction of fixed charge for DS- I (Metered) Change in Fixed Charge for KJ Metered, DS - II consumers Change in MMC
Commissions view 8.5.2 The proposal for levy of premium for supply in notified area has been dealt earlier in this chapter and is not being repeated here. The Commission does not approve the proposal for change in consumption slab and changes in MMC are not accepted. Introduction of fixed charge for DS-I consumer metered category could result in significant fixed financial liability on small rural consumer and is therefore not being allowed. The proposed change in fixed charge for Domestic Service category is not being approved. The Commission for the continuity of tariff structure would like to continue with the existing methodology for computation of fixed charges. Non-Domestic Service (NDS) Petitioners submission 8.5.3 BSEB has proposed the following changes for this consumer category:
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Supply premium payable by consumers in notified areas Introduction of fixed charge for NDS- I (Metered) Change in coverage of NDS- III category introducing applicability to sanctum- sanctorum of religious places also.
Commissions view 8.5.4 The proposal for levy of premium for supply in notified area has been dealt earlier in this chapter and is not being repeated here. Introduction of fixed charge for NDS-I consumer metered category could result in significant fixed financial liability on small rural consumer and is therefore not being allowed.. The Commission for the continuity of tariff structure would like to continue with the existing methodology for computation of fixed charges. The Commission does not approve the change in coverage of NDS III category. Irrigation & Agricultural Service (IAS) Petitioners submission 8.5.5 BSEB has proposed following changes for this consumer category: Change in MMC
Commissions view 8.5.6 The Commission does not approve the proposed changes in MMC for IAS category. Low Tension Industrial Service (LTIS) Petitioners submission 8.5.7 BSEB has proposed following changes for this consumer category: Supply premium payable by consumers in notified areas Merging of LTIS-I and LTIS- II consumer categories All new consumers under Three Phase LTIS shall come under LTIS (Demand based categories) Option to change to HTS-I category Change in MMC.
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Commissions view 8.5.8 The proposal for levy of premium for supply in notified area has been dealt earlier in this chapter and is not being repeated here. The Commission does not approve the suggested merging of LTIS I and LTIS II sub-categories. The issues related to consideration of all new consumers under three phase LTIS (Demand Based Tariff) category and option to LTIS consumers having load more than 79 HP and 99 HP to avail supply under HTIS I at 11 kV have been dealt earlier in this chapter. Public Water Works (PWW) Petitioners submission 8.5.9 BSEB has proposed the following changes for this consumer category: Supply premium payable by consumers in notified areas Option to change to HTS-I category
Commissions view 8.5.10 The proposal for levy of premium for supply in notified area has been dealt earlier in this chapter and is not being repeated here. The petitioners proposal that PWW consumers having load more than 79 HP and 99 HP may avail supply under HTIS I at 11 kV has been dealt earlier in this chapter. . Street Light Services (SS) Petitioners submission 8.5.11 BSEB has proposed following changes for this consumer category: Supply premium payable by consumers in notified areas
Commissions view 8.5.12 The proposal for levy of premium for supply in notified area has been dealt earlier in this chapter and is not being repeated here. HTS-I, HTS-II, HTS-III and HTSS Petitioners submission
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8.5.13 BSEB has proposed following changes for this consumer category: Supply premium payable by consumers in notified areas Reclassification of contract Demand Increase in HTSS surcharge to 7.5% instead of 5% on demand and energy charges Change in MMC
Commissions view 8.5.14 The proposal for levy of premium for supply in notified area and reclassification of contract demand has been dealt chapter in this chapter. The proposed change related to HTSS surcharge and MMC for HTS I, HTS II and HTS III categories has been dealt in the tariff schedule for HT supply. Railway Traction Services (RTS) Petitioners submission 8.5.15 BSEB has proposed following changes for this consumer category: Introduction of rebate for RTS tariff for availing supply at voltages higher than 132 kV Change in Load factor to 50% for calculation of minimum base energy Penalty to RTS if in any month the recorded maximum demand of the consumer exceeds 110% of the contract demand
Commissions view 8.5.16 The Board has proposed rebate for RTS tariff for availing supply at higher than 132 kV therefore this proposal of the Board is accepted by the Commission. However, the Commission does not approve others changes proposed by the petitioner related Railway Traction Services. Amendment to Supply Code 8.5.17 The Commission notified amendment in Bihar Electricity Suppply code, 2007 vide notification no. BERC- Regulation 6/06 (Part IV- I) -02 dated 29.03.2012 where in the maximum contract demand at diifferent supply voltage have been revised. The Commission has considered the relevant amendments in this Tariff Order for FY 2012-13.
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8.6 8.6.1
Approved tariff categories for FY2012-2013 The approved tariff categories / sub-categories along with different slabs are given below:
S.No. Category 1 1.1 (i) Domestic Service (DS) Kutir Jyoti (KJ)/ BPL Connection Kutir Jyoti / BPL (Rural) Unmetered Connected load: upto 60 Watt Metered Connected load: upto 60 watt (ii) Kutir Jyoti / BPL (Urban) Metered only Connected load: upto 100 watt 1.2 Domestic - I (Rural) Unmetered Connected load: Upto 2 kW Metered Connected load: upto 2 kW 1.3 Domestic-II (DS-II) Metered only Urban Single phase upto 7 kW Three phase 5 kW and above Rural For connected load above 2 kW 1.3.1 Domestic II (DS-II) (D) OPTIONAL Demand based tariff Contract demand between 5 kW and 70 kW 1.4 Domestic-III Urban - Metered Registered societies for their residential colonies, having not less than 15 houses/ flats in the colony. Residential colonies/ multistoried residential
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S.No. Category complexes taking load in bulk at a single point with a minimum load of 2 kW per flat/ house and maximum total load upto 70 kW. 2 2.1 Non-Domestic Services (NDS) Non- Domestic Services - I : Rural Unmetered Connected load: Upto 2 kW Metered Connected load: Upto 2 kW 2.2 Non- Domestic Services - II: Urban and Rural Above 2 kW Metered Connected load: upto 70 kW for urban consumers & above 2 kW for Rural consumers Non-Domestic Services- II (D) OPTIONAL Demand based tariff Contract demand between 5 kW and 70 kW 2.3 Non- DomesticServices - III: Metered (Places of worship etc.) Connected Load: Upto 30 kW 2.3.1 Non-Domestic III (D) OPTIONAL Demand based tariff Contract demand between 5 kW and 30 kW 3 3.1 (i) (ii) Irrigation and Agricultural Service (IAS) IAS - I Unmetered Private tube wells including bonafide agricultural Operations. Metered Private tube wells including bonafide agricultural Operations and hatcheries, poultries and fisheries (Fish ponds) IAS-II : Connected Load: Upto 100 HP Unmetered Metered Low Tension Industrial Services (LTIS) LTIS-I: Upto 25 HP
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2.2.1
3.2 (i) (ii) 4 4.1
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S.No. Category 4.1.1 LTIS-I (D) OPTIONAL Demand based tariff - Contract demand upto 15 kW 4.2 4.2.1 LTIS-II: Above 25 HP upto 99 HP LTIS-II (D) OPTIONAL Demand based tariff - Contract demand above 15 kW and upto 60 kW 5 6 6.1 6.2 7 7.1 Public Waterworks (PWW) upto 99 HP Street Light Services SS-I Metered Supply SS-II Unmetered Supply High Tension Supply HTS-I 11 /6.6 kV supply For installations having contract demand of 75 kVA to 1500 kVA. 7.2 HTS-II 33 kV supply For installations having contract demand of 1000 to 10000 kVA 7.3 HTS III - 132 kV supply For installations having contract demand of 7.5 MVA and above 7.4 HTSS - 33/11 kV supply Specified Services for Induction furnaces and allied loads. 8 Railway Traction Services (RTS) RTS (At 132 kV supply or above) RTS (At Lower than 132 kV supply) 9 10 Temporary Supply (LT & HT) Seasonal Supply
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8.6.2
The approved Tariff Schedule which shall be effective from 1st April 2012 is given in Appendix I. Part A - Tariff Schedule for Low Tension Supply Part B - Tariff Schedule for High Tension Supply Part C - Miscellaneous and General Charges The Board has proposed to revise the miscellaneous and general charges for FY 2012-13. The existing applicable miscellaneous and general charges have been appoved in Tariff Order for FY 2011-12. The Wholesale price Index has increased. The Miscellaneous and General Charges, which are essentially driven by the labour and material costs have undergone significant amount of increase and the present rates do not reflect the actual cost. So, the Commission finds it proper to revise the General and Miscellaneous charges. The General and Miscellaneous charges as approved by the Commission are provided in part C of this chapter. These charges will be effective from the date of the applicability of new approved retail tariff. Part D - Fuel and Power Purchase Cost Adjustment FPPCA charges will be based on the formula given by the Commission in the Part D of this chapter. The formula will be applied on monthly basis by BSEB after seeking the regulatory approval.
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Appendix- 1 8.7 TARIFF SCHEDULE FOR RETAIL TARIFF RATES AND TERMS AND
CONDITIONS OF SUPPLY FOR FY 2012-13 (Effective from 01st April, 2012) PART - A: LOW TENSION SUPPLY
System of supply: Low Tension Alternating Current, 50 cycles Single Phase supply at 230 Volts Three Phase supply at 400 Volts
The tariffs are applicable for supply of electricity to L.T consumers with a connected load upto 70 kW for domestic and non-domestic category, upto 99 HP for industrial (LTIS) and for public water works (PWW) category and upto 100 HP for irrigation category. Single Phase supply upto 7.0 kW Three Phase supply 5.0 kW and above
CATEGORY OF SERVICE AND TARIFF RATES 1.0 DOMESTIC SERVICE
Applicability This tariff is applicable for supply of electricity to domestic purposes such as lights, fans, radios, televisions, heaters, air-conditioners, washing machines, air-coolers, geysers, refrigerators, ovens, mixers and other domestic appliances including motor pumps for lifting water for domestic purposes. This is also applicable to the common facilities in the multistoried, purely residential apartments, buildings. 1.1 Kutir Jyoti Connection (KJ) Rural / Urban
This will be applicable to (i) all huts (Kutir) and dwelling houses of rural and urban families below the poverty line (BPL) (ii) houses built under schemes like Indira Awas Yojana and similar such schemes for BPL families.
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i)
Hut (Kutir) means a living place with mud wall and thatched roof or house built under Indira Awas Yojana and other similar schemes for BPL families which shall not exceed 200 Sq ft area.
ii)
The total connected load of Kutir Jyoti connection in a rural area should not exceed 60 watts and for an urban connection it should not exceed 100 watts and maximum consumption 30 units per month shall be allowed.
iii) iv)
Use of CFL both in rural areas and urban areas should be encouraged. In case it is detected that the norms prescribed in para (i) and (ii) above are violated, the Kutir Jyoti Tariff shall immediately become inoperative and rates applicable to DS I and DS- II category as the case may be, with appropriate charge shall apply in such cases.
1.2
Domestic Service I (DS I)
This is applicable to domestic premises in rural areas for a load upto 2 kW not covered by areas indicated under DS-II and not being fed from urban / town feeders. 1.3 Domestic Service II (DS II)
This is applicable for domestic premises in urban areas covered by Notified area committee / Municipality / Municipal Corporation / Development Authority / All District and Sub divisional towns / Block Head Quarters / Industrial areas /Contiguous Sub urban areas and also areas getting power from Urban / Town feeders for single phase supply for load upto 7 kW and three phase supply for load of 5 kW and above. Rural consumers having sanctioned load above 2 kW will come under this category. Consumer has the option to take single -phase or three-phase supply connection for a load of 5KW. 1.4 Domestic Service III (DS III)
This is applicable for registered societies, for their residential colonies, having not less than 15 houses / flats in the colony. Residential colonies / multistoried residential complexes taking load in bulk at a single point with a minimum load of 2 kW per flat / house and maximum total load upto 70 kW.
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TARIFF RATES 1.0 Domestic Service Sl. 1.1 (i) Fixed charge (Rs.) Kutir Jyoti - BPL Consumers Category of consumer K.J. (Rural) - (Consumption upto 30 units per month) Rs.50 / Unmetered connection / per month 150 Ps/ unit Metered Subject to Monthly Minimum Charge of Rs.40 per month per connection. K.J. (Urban) (consumption upto 30 units per month) 180 Ps/ unit Metered only X Subject to Monthly Minimum Charge of Rs.50 per connection per month. X Energy charge (Paisa/ Unit.)
(ii)
Fuel and Power Purchase cost Adjustment (FPPCA) charges as applicable will be charged extra however the same shall be provided by the State Government support to consumers and will not be recovered from consumer. Energy Charges Consumption in a Rate P/unit month (Units) DS I : Connected load: Upto 2 kW only Rs.150/connection Unmetered X X / per month First 50 units 180 Category of consumer Fixed Charge (Rs.) X Metered X 51-100 units 210 Above 100 units 250 Subject to Monthly Minimum Charge (MMC) of 1st kW 40 units per month 2nd kW 20 units per month
Sl. 1.2
Fuel and Power Purchase cost Adjustment (FPPCA) charges as applicable will be charged extra.
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Sl. 1.3
Category of consumer DS II (Metered) Single phase Up to 7 kW
Fixed charge (Rs.)
Energy charges Consumption in a month (Units) Rate Ps/unit
First kw-Rs.50/ month/connection Addl. kW-Rs.15 per kW or part thereof per month. 1-100 units 101-200 units 201-300 units Above 300 units 260 320 385 490
Three Phase 5 kW and above
5 kW-Rs.230/ month/connection Addl. kW-Rs.15 per kW or part thereof per month
Subject to monthly minimum charge for 1st kW - 40 units per month Additional kW or part thereof - 20 units per month Fuel and Power Purchase Cost Adjustment (FPPCA) charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. OPTIONAL Domestic - DS-II (D) Demand Based All consumers under DS-II category with 3 phase meter connection with contract demand between 5 kW and 70 kW opting for demand based tariff shall be required to pay at the rates indicated below: Energy charges Rate Ps/unit
Sl. 1.3.1
Consumption in a month (Units) DS-II (D)-(OPTIONAL) Demand Based Tariff Contract demand Rs. 60/kW per 1-100 units of 5 kW to 70 kW month or part thereof on recorded 101-200 units demand or contract 201-300 units demand whichever Above 300 units is higher.
Category of consumer
Demand charge (Rs./kW/month)
260 320 385 490
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Sl.
Subject to (i) Monthly minimum charge of 50 units per month/kW on recorded demand or contract demand, whichever is higher. (ii) If in any month the recorded maximum demand exceeds 110% of the contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal rate. Fuel and Power Purchase Cost Adjustment (FPPCA) charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. Sl. 1.4 Category of consumer Fixed charge (Rs.) Energy charges Consumption in a month (Units) All units Rate (Ps/unit) 385
DS III (Metered) Rs. 55/- kW/ month
Subject to monthly minimum charge For 1st kW 40 units / flat per month Additional kW or part there of 20 units/flat per month FPPCA as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. 2.0 NON-DOMESTIC SERVICE (NDS) Applicability This is applicable for supply of electrical energy for non-domestic consumers having sanctioned load upto 70 kW, using electrical energy for light, fan and power loads for non domestic purposes like shops, hospitals, nursing homes, clinics, dispensaries, restaurants, hotels, clubs, guest houses, marriage houses, public halls, show rooms, centrally air-conditioning units, offices, commercial establishments, cinemas, X-ray plants, non government schools, colleges, libraries and research institutes, boarding / lodging houses, libraries, railway stations, fuel/oil stations, service stations, All India Radio / T.V. installations, printing presses, commercial trusts, societies, banks, theatres, circus, coaching institutes, common facilities in multistoried commercial office / buildings Government and semigovernment offices, public museums and other installations not covered under any other tariff schedule.
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Government educational institutions, their hostels and libraries, Government hospitals and government research institutions and non profitable government aided educational institutions their hostels and libraries. Non-profit recognized charitable cum public institutions. Places of worship like temples, mosques, gurudwaras, churches etc. and burial / crematorium grounds. 2.1 Non Domestic Service (NDS-I)
Applicable to loads upto 2 kW in rural areas not covered by areas indicated under NDS II and not being fed from urban / town feeders. TARIFF RATES NDS - I Energy charges Fixed charge (Rs.) 2.1 NDS- I Unmetered Metered Consumption in a month (Units) x Rate ps/unit X
Rs.200/connection/ per month x x x x
1-100 units 210 101-200 units 250 Above 200 units 285 Subject to monthly minimum charge of 50 units per kW
FPPCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. . 2.2 Non Domestic Service NDS II (Metered)
Applicable to loads upto 70 kW in urban areas covered by Notified Area Committees / Municipalities / Municipal Corporations / Regional Development Authorities / District and Sub divisional towns / Block headquarters / Industrial areas / contiguous sub urban areas getting power from urban / town feeders, except those covered under NDS-III. Rural consumers having sanctioned load above 2 kW will also come under this category.
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TARIFF RATES NDS - II Sl. 2.2 Fixed charge (Rs.) Per month NDS - II Single phase Rs.180 /kW or part thereof upto 7 Kw Three Phase Rs.200/kW or part thereof for loads of 5 kW and above Subject to a monthly minimum charge of 50 units/kW or part thereof FPPCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. OPTIONAL 2.2.1 Non-Domestic Service - NDS II (D) Demand Based Energy charges Consumption in a Rate ps/unit month (Units) 1-100 units 101-200 units Above 200 units 470 500 540
All those consumers under NDS-II with 3 phase supply and contract demand between 5 kW and 70 kW opting for demand based tariff shall be required to pay at the rates indicated below: Category of consumer Energy charges Rate ps/unit 470 500 540
Sl. 2.2.1
Consumption in a month (Units) NDS-II (D) (OPTIONAL) Demand Based Tariff Contract demand Rs. 250/kW per 1-100 units of 5 kW to 70 kW month or part 101-200 units thereof on recorded Above 200 units demand or contract demand whichever is higher.
Subject to (i) Monthly minimum charge of 70 units per month/kW on recorded demand or contract demand, whichever is higher. (ii) If in any month the recorded maximum demand exceeds 110% of contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal rate. Fuel and Power Purchase Cost Adjustment (FPPCA) charges as applicable will be charged extra.
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Premium tariff will be charged as applicable in notified area. 2.3 Non-Domestic Service - NDS III (Metered)
This is applicable for places of worship like temples, mosques, gurudwaras, churches etc. and burial / crematorium grounds. If any portion of the premises is used for commercial purposes, a separate connection shall be taken for that portion and NDSII tariff schedule shall be applicable for that service. TARIFF RATES NDS - III Sl. 2.3 Fixed charge (Rs.) NDS - III Rs.80 /kW with minimum of Rs.165 per connection / month For load upto 30 KW. Energy charges Consumption in a Rate ps/unit month (Units) 1-100 units 101-200 units Above 200 units 275 350 430
Subject to monthly minimum charge of 50 units/kW or part thereof. FPFCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. OPTIONAL 2.3.1 Non-Domestic Service - NDS III (D) Demand Based
All those consumers under NDS-III category with 3 phase supply and with contract demand between 5 kW and 30 kW opting for demand based tariff shall be required to pay at the rates indicated below: Energy charges Rate Ps/unit
Sl. 2.3.1
Consumption in a month (Units) NDS-III (D) (OPTIONAL) Demand Based Tariff Contract demand Rs. 80/kW per of 5 kW to 30 kW month or part 1-100 units thereof on recorded 101-200 units demand or contract Above 200 units demand whichever is higher.
Demand charge (Rs./kW)
275 350 430
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Sl.
Subject to (i) Monthly minimum charge of 70 units per month/kW on recorded demand or contract demand, whichever is higher. (ii) If in any month the recorded maximum demand exceeds 110% of contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal rate. Fuel and Power Purchase Cost Adjustment (FPPCA) charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. 3.0 IRRIGATION and AGRICULTURE SERVICE (IAS) Applicability This is applicable for supply of electrical energy for bonafide use for agricultural purposes including processing of Agricultural Produce, confined to chaff - cutter, thrasher, cane crusher and rice Huller when operated by the agriculturist in the field or farm and does not include rice mills, flour mills, oil mills, dal mills or expellers. This is also applicable to hatcheries, poultries (with more than 1000 birds) and fisheries (fish ponds). 3.1 IAS - I
This is applicable for all purposes indicated above including private tube wells.
Tariff Rates Unmetered Supply Rural feeder - Rs.120 / HP per month Urban feeder - Rs.145 /HP per month Note: Hatcheries, poultries and fisheries are not covered under unmetered supply they have to be metered only.
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Metered supply Rural feeder Energy Charges 100 Ps/unit Urban feeder Energy Charges 150 Ps/unit
Subject to monthly minimum energy charges of Rural feeder - Rs. 85/HP per month Urban feeder - Rs.130/HP per month Fuel and Power Purchase cost Adjustment (FPPCA) charges as applicable will be charged extra however the same shall be provided by the State Government support to consumers and will not be recovered from consumer. 3.2 IAS II
This is applicable to state tube wells / state lift irrigation pumps / state irrigation pumps upto 100 HP. Unmetered Supply Rural feeders - Rs.900 /HP per month Urban feeders - Rs.1000/HP per month Metered supply Rural feeder Energy Charges 600 Ps/unit Urban feeder Energy Charges 700 Ps/unit
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Subject to a monthly minimum energy charge of 225 units /HP per month. FPPCA charges as applicable will be charged extra. 4.0 LOW TENSION INDUSTRIAL SERVICE (LTIS) Applicability This is applicable for supply of electricity to low tension industrial consumers with a connected load upto 99 HP and below including incidental lighting for industrial processing or agro industries purposes, arc welding sets, flour mills, oil mills, rice mills, dal mills, atta chakki, Huller, expellers etc. 4.1 LTIS-I (Connected load upto 25 HP)
TARIFF RATES for LTIS - I Fixed charge (Rs.) 4.1 Energy charges Consumption in a month (Units) Rate (ps/unit)
LTIS-I (Connected load upto 25 HP) Rs.85/HP or part All units 495 thereof / per month Subject to monthly minimum charge of 70 units/HP or part thereof.
FPPCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. OPTIONAL 4.1.1 LTIS-I (D) Contracted demand 5 kW to 15 kW - Demand Based Tariff
All those consumers under LTS-I category with 3 phase supply and with contract demand 5 kW to 15 kW opting for demand based tariff shall be required to pay at the rates indicated below: Energy charges Sl. Consumption in a month (Units) LTIS-I (D) (Demand Based Tariff) (OPTIONAL) Category of consumer Demand charge (Rs./kW) Rate Ps/unit
4.1.1
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Energy charges Sl. Category of consumer Contract demand 5 kW to 15 kW Demand charge (Rs./kW) Rs. 170/kW per month or part thereof on recorded demand or contract demand whichever is higher. Consumption in a month (Units) All units Rate Ps/unit
495
Subject to (i) Monthly minimum charge of 125 units per month/kW on recorded demand or contract demand, whichever is higher. (ii) If in any month the recorded maximum demand exceeds 110% of contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal rate. Fuel and Power Purchase Cost Adjustment (FPPCA) charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. 4.2 LTIS-II (Connected load above 25 HP and upto 99 HP) Energy charges Sl. Fixed charge (Rs.) Consumption in a month (Units) 4.2 LTIS-II (Connected load above 25 HP and upto 99 HP) Rs.110/HP or part thereof per month All units 530 Rate (Ps/unit)
Subject to monthly minimum charge of 100 units/HP or part thereof. FPPCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. Consumers with a connected load above 79 HP and upto 99 HP have option to avail power under LTIS / HTS category.
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OPTIONAL 4.2.1 LTIS-II (D) (Contract demand above 15 kW and upto 70 kW Demand
Based Tariff) All those consumers under LTS-II category with 3 phase supply and with contract demand above 15 kW and upto 70 kW opting for demand based tariff shall be required to pay at the rates indicated below:
Category of consumer 4.2.1
LTIS-II (D) (Demand Based Tariff) (OPTIONAL) Contract demand above 15 kW and upto 70 kW Rs. 195/kW per month or part thereof on recorded demand or contract demand whichever is higher. All units 530
Subject to (i) Monthly minimum charge of 180 units per month/kW on recorded demand or contract demand, whichever is higher. (ii) If in any month the recorded maximum demand exceeds 110% of contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal rate.
Fuel and Power Purchase Cost Adjustment (FPPCA) charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. 5.0 PUBLIC WATERWORKS (PWW) (Connected load upto 99 HP) Applicability This is applicable to public water works, sewerage treatment plant and sewerage pumping stations functioning under state government and state government under takings and local bodies.
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Sl. 5.0
Energy charges Consumption in a Rate month (Units) (Ps/unit) PUBLIC WATERWORKS (PWW) (Connected load upto 99 HP) Rs. 190/HP or part thereof All units 650 per month Subject to monthly minimum charge of 165 units / HP or part thereof. Fixed charge (Rs.)
FPPCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area. Consumers with a connected load above 79 HP and upto 99 HP have the option to avail power under PWW / HTS category. 6.0 STREET LIGHT SERVICES (SS) Applicability This is applicable for supply of electricity for street light system including signal system in corporation, municipality, notified area, committees, panchayats etc. and also in areas not covered by municipality and notified area committee provided the number of lamps from a point of supply is not less than five. Also applicable for Traffic Lights, Mast lights / Blinkers etc. Tariff Rates 6.1 SS-I Metered Supply
All units 650 Ps. /unit Subject to monthly minimum charge of:i) Gram Panchayats 160 units / kW or part thereof ii) For Nagar Palika / NAC / Municipality 220 units / kW or part thereof iii) For Municipal Corporations 250 units / kW or part thereof FPPCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area.
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6.2
SS-II Unmetered Supply
Fixed Charges i) Gram Panchayats Rs. 250 per 100 W/month or part thereof ii) For Nagar Palika / NAC / Municipality Rs. 325 per 100 W/month or part thereof iii) For Municipal Corporations Rs. 400 per100 W/month or part thereof FPPCA charges as applicable will be charged extra. Premium tariff will be charged as applicable in notified area.
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TERMS AND CONDITIONS OF LOW TENSION TARIFF The foregoing tariffs are subject to the following conditions: 1. Rebate for prompt payment The due date for making payment of energy bills or other charges shall be 15 days from the date of issue of the bill. Rebate will be allowed for making payment of energy bills on or before due date specified in the bill as given below: i. ii. iii. Kutir Jyoti (Unmetered) DS-I and NDS-I (Unmetered) Agricultural and Irrigation pumpsets (Unmetered) iv. v. Street Lights (Unmetered) All metered categories Rs.3/- per connection/month 10 paise per unit, on units billed Rs.2/- per connection per month. Rs.3/- per connection per month. Rs.5/- per HP/month
In case a consumer makes full payment after due date but within 10 days after the due date, no DPS shall be leviable for this period but rebate for prompt payment will not be admissible. 2. Accounting of Partial payment All payment made by consumers in full or part shall be adjusted in the following order of priority: a) b) c) d) e) 3. Statutory taxes and duties on current consumption Arrear of Statutory taxes and duties Delayed payment surcharge Balance of arrears Balance of current bill
Delayed Payment Surcharge (DPS) In case a consumer does not pay energy bills in full within 10 days grace period after due date specified in the bill, a delayed payment surcharge of one and half (1.5) percent per month or part thereof on the outstanding principal amount of bill will be levied from the due date for payment until the payment is made in full without prejudice to right of the licensee to disconnect the supply in accordance with Section 56 of the Electricity Act, 2003. The licensee shall clearly indicate in the bill itself the
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total amount, including DPS, payable for different dates after the due date after allowing for the grace period of 10 days. No DPS shall be charged on DPS arrear. The bill shall indicate the energy charges for the month, arrears of energy charges and DPS separately. 4. Duties and Taxes Other statutory levies like electricity duty or any other taxes, duties etc., imposed by the State Government / Central Government or any other competent authority, shall be extra and shall not be part of the tariff as determined under this order. 5. Defective / Damaged / Burnt meters supply In case of meter being defective / damaged / burnt the Board or the consumer as the case may be, shall replace it within the specified period prescribed in Standards of Performance for Distribution Licensee, Regulations issued by the Commission. Till defective / damaged / burnt meter is replaced, the consumption will be assessed and billed on an average consumption of last 12 months from the date of meter being out of order. Such consumption shall be treated as actual consumption for all
practical purposes including calculation of electricity duty until the meter is replaced/ rectified. In cases of newly installed meter of a consumer becoming defective/ damaged/ burnt after installation of the meter prior to completion of 12 months since its installation, the billing for the period for such defective/ damaged/ burnt meter, till it is not replaced, shall be done on the basis of average monthly consumption of the consumer or the MMC whichever is higher. 6. Shunt Capacitor Installation a) Every LT consumer including irrigation pump set consumers whose connected load includes induction motor (s) of capacity 3 HP and above and other low power factor consuming appliances shall arrange to install low tension shunt capacitors of appropriate capacity at his cost across terminals of his motor (s). The consumer shall ensure that the capacitors installed by him are properly matched with the actual rating of the motor so as to ensure power factor of 90%.
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b)
All LT consumers having welding transformers will be required to install suitable shunt capacitor (s) of adequate capacity so as to ensure power factor of not less than 90%.
c) d)
The capacitors shall be of standard manufacture and meet the Bureau of Indian Standards specification. Consumers not complying to above shall be liable to pay a surcharge of 5% (five percent) of the billed amount excluding DPS till the capacitors are installed.
e)
Any LT consumer in whose case, the meter installed has power factor recording feature and who fails to maintain power factor of 90% in any month shall pay a surcharge of 5% (five percent) of the billed amount excluding DPS till the defective capacitors are replaced and power factor of 90% is maintained.
f)
No new supply to LT installations having low power factor consuming equipment such as induction motor of 3 HP and above or welding transformers etc., will be released unless shunt capacitors are installed to the satisfaction of the Board.
g)
The ratings of shunt capacitor to be installed on the motors of different ratings are provided in the Electric Supply Code notified by the Commission.
6.
Premium on Consumers in notified areas All LT consumers except Kutir Jyoti and Agricultural consumers in the notified areas where BSEB intends to supply electricity close to 24 hours shall pay 10% premium on demand/fixed and energy charge and in MMC. It may be ensured that transmission and distribution network including other infrastructure required to ensure close to 24 hours supply to the notified areas are strengthened. Strenghthening of infrastructure may include interalia strengthening / replacement of weak conductors, transformers and other electrical equipments installed for supplying electricity to the notified areas, provision of appliances and spares and keeping technical teams ready round the clock for rectifying defects leading to disruption of supply in these areas. A few telephones should be kept operational for each notified area which should be manned round the clock for receiving and responding to the complaints. These telephone numbers should be widely publicised in the newspapers for the information of general public. BSEB must
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ensure these steps for ensuring close to 24 hours supply of electricity to the notified areas. Such areas where BSEB intends to strenghthen the infrastructure and provide facilities as mentioned above and to supply electricity close to 24 (twenty four) hours shall be notified by BSEB and premium shall be levied after notification of such area by BSEB. The continuous supply shall mean the normal supply for nearly 24 hours excluding the grid failure, any force majeure condition, scheduled shut down and emergent breakdown beyond the control of BSEB. 7. Charges to Tatkal Connections (Optional) If the any consumer (other than High Tension and Railway) opts for availing connection under tatkal scheme, the Board shall release the tatkal connection to such consumer with the following conditions: The Tatkal connections shall be released by BSEB in half the time limit prescribed in the Supply code for that consumer category. Two (2) times of the following charges approved under head miscellaneous and general charges will be taken from the consumers willing to avail tatkal connection: o o Application fees for new connection, and; Supervision, labour and establishment charge for service connection
In case BSEB fails to release connection within this time limit, BSEB will refund the additional amount claimed to the consumer in the first energy bill.
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PART - B: HIGH TENSION SUPPLY 7.1 HTS I (11 kV/6.6 kV) Applicable for supply of electricity for use in installations with a minimum contract demand of 75 kVA and maximum contract demand of 1500 kVA. Character of service: AC, 50 cycles, 3 phase at 11 kV or 6.6 kV. TARIFF RATES Demand charge Rs./ kVA / Month of billing demand 270 Energy charges Paise / kWh All units 535
(i) (ii)
The billing demand shall be the maximum demand recorded during the month or 85% of the contract demand whichever is higher. Surcharge of 7.5% will be levied on the demand and energy charges for supply at 6.6 kV.
(iii)
If in any month the recorded maximum demand exceeds 110% of contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal charges.
Premium on HTS-I consumers in notified areas All HTS-I consumers in the notified areas where BSEB intends to supply close to 24 hours shall pay 10% premium on demand/fixed and energy charge. It may be ensured that transmission and distribution network including other infrastructure required to ensure close to 24 hours supply to the notified areas are strengthened. Strenghthening of infrastructure may include interalia strengthening / replacement of weak conductors, transformers and other electrical equipments installed for supplying electricity to the notified areas, provision of appliances and spares and keeping technical teams ready round the clock for rectifying defects leading to disruption of supply in these areas. A few telephones should be kept operational for each notified area which should be manned round the clock for receiving and responding to the complaints. These telephone numbers should be widely publicised in the newspapers for the information of general public. BSEB must ensure these steps for ensuring close to 24 hours supply of electricity to the notified areas.
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Such areas where BSEB intends to strenghthen the infrastructure and provide facilities as mentioned above and to supply electricity close to 24 (twenty four) hours shall be notified by BSEB and premium shall be levied after notification of such area by BSEB. The continuous supply shall mean the normal supply for nearly 24 hours excluding the grid failure, any force majeure condition, scheduled shut down and emergent breakdown beyond the control of BSEB. FPPCA charges as applicable shall be charged extra. 7.2 HTS II (33 kV) This is applicable for use in installations with a minimum contract demand of 1000 kVA and maximum contract demand of 15,000 kVA. Character of service: AC, 50 cycles, 3 phase at 33 kV.
TARIFF RATES Demand charge Rs. / kVA / Month of billing demand 270 (i) Energy charges (Paise / unit) All units - 520
The billing demand shall be the maximum demand recorded during the month or 85% of the contract demand whichever is higher.
(ii)
If in any month the recorded maximum demand exceeds 110% of contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal charges.
FPPCA charges as applicable shall be charged extra. 7.3 HTS III (132 kV) This is applicable for installations with a minimum contract demand of 7.5MVA. Character of service: AC, 50 cycles, 3 phase at 132 kV TARIFF RATES Demand charge Rs. / kVA / Month of billing demand 270 Energy charges (Paise / unit) All units 510
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(i)
The billing demand shall be the maximum demand recorded during the month or 85% of the contract demand whichever is higher.
(ii)
If in any month the recorded maximum demand of the consumer exceeds 110% of the contract demand, that portion of the demand in excess of the contract demand will be billed at twice the normal charges.
FPPCA charges as applicable shall be charged extra. 7.4 HTSS (33 kV/11 kV) This is applicable for supply of electricity to all consumers who have contract demand of 300 kVA and more for induction furnace including Ferro Alloy loads. This tariff will not apply to casting units having induction furnace of melting capacity of 500 Kg and below.
The capacity of induction furnace shall be 600 kVA per metric tonne as existing for determining the contract demand of induction furnace in the existing HTSS service connections. However, for new connection and if the furnace is replaced with a new one for the existing connections, the contract demand shall be based on total capacity of the furnace and equipment as per manufacturer technical specifications, and in case of difference of opinion, the provisions of clause Nos. 6.39 and 6.40 of the Bihar Electricity Supply Code shall apply.
Those consumers who are having rolling/re-rolling mill in the same premises will take additional contract demand for the rolling/re-rolling mill over and above the contract demand required for induction furnace. The consumer will have the option to segregate the rolling/re-rolling mill and take separate new connection following all prescribed formalities with a separate transformer. This new connection, if taken by the consumer will be allowed to be billed in appropriate tariff schedule. rolling/re-rolling mill will be allowed to avail power at 33 kV. Such
Character of service: AC, 50 cycles, 3 phase at 33 kV or 11kV. TARIFF RATES Demand charge Rs. / kVA / Month of billing demand 700 Energy charges (Paise / unit) All units 270
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(i)
The billing demand shall be the maximum demand recorded during the month or the contract demand whichever is higher.
(ii)
If in any month the recorded maximum demand of the consumer exceeds 110% of contract demand that portion of the demand in excess of the contract demand will be charged at twice the normal charges.
(iii) If the power is availed at 11 kV a surcharge of five (5) % will be charged extra on demand and energy charges. FPPCA charges as applicable shall be charged extra.
8.0
Railway Traction Service (RTS) Applicable to Railway Traction loads only.
Tariff rates at 132 kV Demand charge Rs. / kVA / Month of billing demand 240 Energy charges (Paise / unit) All units 520
(i) (ii)
15 Ps/unit of rebate will be provided for availing supply at voltages higher than 132 kV 15 Ps/unit of surcharge will be billed for availing supply at lower voltages than 132 kV.
(iii) The billing demand shall be the maximum demand recorded during the month or 85% of the contract demand whichever is higher. FPPCA charges as applicable shall be charged extra.
Time of Day tariff (ToD) All HT consumers other than Railway traction have the option to take TOD tariff instead of the normal tariff given in the schedule. Under the Time of Day (ToD) Tariff, electricity consumption and maximum demand in respect of HT consumers for different periods of the day, i.e. normal period, peak load period and off-peak load period, shall be recorded by installing a ToD meter.
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The maximum demand and consumption recorded in different periods shall be billed at the following rates on the tariff applicable to the consumer. Time of use (i) Normal period (5:00 a.m. to 5:00 p.m) (ii) Evening peak load period (5:00 p.m to 11.00 p.m) (iii) Off-peak load period (11:00 p.m to 5:00 a.m) Applicability and Terms and Conditions of TOD tariff: (i) TOD tariff will be optional for all HT consumers having contract demand below 200 kVA. TOD tariff will be mandatory for all HT consumers having contracted demand of 200 kVA and above. (ii) The facility of aforesaid TOD tariff shall not be available to HT consumers having captive power plants and/or availing supply from other sources through wheeling of power. (iii) The HT industrial consumers who have installed standby generating plants shall also be eligible for the aforesaid TOD tariff. (iv) After electing TOD tariff, if any industrial HT consumer on account of some reasons wants to go back to the earlier tariff according to the agreement, this facility shall be available to him only once in two years. (v) If the actual monthly consumption of such HT consumer, whose monthly minimum charges are based on units, is less than minimum consumption, then the difference (deficit) of units between the minimum consumption and actual consumption shall be billed at normal rate of energy charge prescribed for Normal Period. (vi) In the event of applicability of TOD tariff to a consumer, the terms and conditions of the applicable tariff (such as monthly tariff minimum charge, etc.) shall continue to apply. (vii) In case, the consumer exceeds 110% of the contract demand, the demand in excess of contract demand shall be billed at twice the normal tariff applicable for the day time i.e. 5:00 a.m. to 5.00 p.m. irrespective of the time of use. Normal Rate Normal Rate 120% of normal rate of energy charges 85% of normal rate of energy charges Demand Charges Energy Charges Normal Rate Normal rate of energy charges
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TERMS AND CONDITIONS OF HT TARIFF The foregoing tariffs are subject to the following conditions: 1. Rebate for Prompt Payment The due date for making payment of energy bills or other charges shall be 15 days from the date of issue of the bill. The tariff rates are subject to prompt payment rebate of 1 (one) paise per unit on units billed provided the bill is paid by due date specified therein. If the consumer makes full payment after due date but within 10 days after due date, no DPS shall be leviable for this period but rebate for prompt payment will not be admissible. 2. Delayed Payment Surcharge (DPS) In case of consumer does not pay energy bills in full within 10 days grace period after due date specified in the bill, a delayed payment surcharge of one and half (1.5) % per month or part thereof on the outstanding principal amount of bill will be levied form the original due date for payment until the payment is made in full without prejudice to right of the licensee to disconnect the supply in accordance with Section 56 of the Electricity Act, 2003. The licensee shall clearly indicate in the bill itself the total amount, including DPS, payable for different dates after the due date after allowing for the grace period of 10 days. No DPS shall be charged on DPS arrear. 3. Duties and Taxes Other statutory levies like electricity duty or any other taxes, duties etc., imposed by the State Government / Central Government or any other competitive authority, shall be extra and shall not form part of the tariff as determined under this order. 4. Power Factor Surcharge The average power factor (monthly) of the supply shall be maintained by the consumer not less than 0.90. If the monthly average power factor falls below 90% (0.9) he shall pay a surcharge in addition to his normal tariff at the following rates:
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(i) For each fall of 0.01 in power factor upto 0.80 (ii) For each fall of 0.01 in power factor below 0.80
One percent on demand and energy charge 1.5 (one and half) percent on demand and energy charge (Actual Recorded)
If the average power factor falls below 0.70 consecutively for 3 months, the Board reserves the right to disconnect the consumers service connection without prejudice for the levy of the surcharge. 5. Power Factor Rebate In case the average power factor (monthly) of the consumer is more than 90% (0.90) a power factor rebate at the following rates shall be allowed. For each increase of 0.01 in power factor above 0.90 upto 0.95 For each increase of 0.01 in power factor above 0.95 0.5 (half) percent on demand and energy charge (Actual Recorded) 1.0 (one) percent on demand and energy charges. (Actual Recorded)
6.
Accounting of Partial payment All payment made by consumers in full or part shall be adjusted in the following order of priority: a) b) c) d) e) Statutory taxes and duties on current consumption Arrear of Statutory taxes and duties Delayed payment surcharge Balance of arrears Balance of current bill
Transformer Capacity The transformer capacity of HT consumer shall not be more than 150% of the contract demand, consumer found to be utilizing transformer of higher capacity than admissible for his contracted load, will fall under malpractice.
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If standard capacity is not available for exact requirement then relaxation in transformer capacity upto 10% extra can be allowed in individual cases on request. All HT/EHT consumers having contract demand of 200 kVA and above may be allowed to have a stand by transformer, whose capacity shall not be more than the main transformer. The technical/physical arrangement shall be approved by the Boards officer before it is installed. If any consumer violates the condition, then line will be disconnected and standby facility shall be withdrawn. Considering the special need of the Railway, the RTS consumer may be allowed to have 100% extra i.e. 200% of the contract demand. Stand by transformer may also be allowed, which should not be more than the capacity of the main transformer. 8 Defective / Damaged / Burnt meter replacement In case of meter being defective / damaged / burnt the Board or the consumer as the case may be shall replace the same within the period specified in Standards of Performance for Distribution Licensee Regulations issued by the Commission. Till defective meter is replaced the consumption will be assessed and billed on an average consumption of last 12 months from the date of meter being out of order. Such consumption shall be treated as actual consumption for all practical purposes including calculation of electricity duty until the meter is replaced/ rectified. In cases of newly installed meter of a consumer becoming defective/ damaged/ burnt after installation of the meter prior to completion of 12 months since its installation, the billing for the period for such defective/ damaged/ burnt meter, till it is not replaced, shall be done on the basis of average monthly consumption of the consumer or the MMC whichever is higher.. 9. If the actual recorded demand of a consumer exceeds 110% consecutively for three months Board may issue a notice and inform the consumer to get additional contract demand sanctioned or to limit their drawal as per their contract. Otherwise Board will take action as per provisions of the Act/Rules/Regulations. 10. The prevailing practice will continue for determining the contract demand of induction furnaces in the existing services connections. However, for new connections and where the furnaces are replaced in existing connections, contract demand shall be based on the total capacity of the furnace and equipment as per manufacturer
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technical specifications and in case of difference of opinion, the provisions of clause No.6.39 and 6.40 of Bihar Electricity Supply Code shall apply.
11.
The Government of Bihar had issued Industrial Incentive Policy Bihar-2006 in order to create favourable environment and accelerated industrial growth of the State. The Policy states (a) Existing and New Units: Working units at present and new units will avail exemption from AMG/MMG from the date of declaration of the New Industrial Policy. The facility will be granted for a period of five years (b) Sick units: The following facilities are provided to sick units. Exemption from Annual Minimum Guarantee (AMG), Monthly Minimum Guarantee (MMG) and Delayed Payment Surcharge (DPS) would be available to the unit from the date of declaration of the unit as sick unit. This facility would be admissible for a period of five years. The Board shall comply with the Industrial Policy of Government of Bihar and its subsequent revisions if any till the time it remains applicable. Such Industrial Policy shall be extended to other eligible consumers who are covered under this Policy.
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9.0
Temporary Supply (LT and HT) 9.1 Applicability
This tariff is for connection of temporary in nature for period of less than one year. The applicability shall be as given in the respective category tariff rate schedule. Temporary supply cannot be claimed by a prospective consumer as a matter of right but will normally be arranged by the Board when a requisition is made giving due notice subject to technical feasibility and in accordance with electricity supply code issued by the Commission. 9.2 Tariff
Fixed charge and energy charge shall be chargeable at one and half times the normal tariff as applicable to the corresponding appropriate tariff category. 9.3 Terms of Supply
a) Temporary supply under any category of service may be given for a period not exceeding 30 days in the first instance, the duration of which, however may be extended on month-to-month basis subject to maximum of one year. b) In addition to the charges mentioned above, the consumer shall have to deposit the following charges before commencement of the temporary supply: (i) (ii) (iii) (iv) Estimated cost of erection of temporary service line and dismantling. Cost of irretrievable materials which cannot be taken back to service. Meter rent for the full period of temporary connection as per appropriate Tariff Schedule and miscellaneous charges. Rental on the cost of materials as per estimate framed but not payable by the consumer shall be payable at the rate of Rs. 15/- per month on every Rs. 100/- or part thereof. (v) Ten per cent on the total cost of the estimate for the temporary service connection to cover as security for loss of materials and contingencies. In case such loss is not noticed, the amount will be refunded. c) The applicants for temporary supply shall be required to make a deposit in advance of the cost as detailed above including the energy consumption charges estimated for full period on the basis of connected load. This will however, be
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adjusted against the final bill that will be rendered on disconnection of supply month to month basis. d) If the consumer intends to extend the temporary supply beyond the period originally applied for, he will have to deposit in advance all charges as detailed above including the estimated electricity consumption charges, for the period to be extended and final bill for the previous period, as well. e) The temporary supply shall continue as such and be governed by the terms and conditions specified above until the supply is terminated or converted into permanent supply at the written request of the consumer. The supply will be governed by the terms and conditions of permanent supply only after the consumer has duly completed all the formalities like execution of agreement, deposit of security money, cost of service connection and full settlement of the account in respect of the temporary supply etc. 10.0 Seasonal Supply (LT and HT)
1. Seasonal supply shall be given to any consumer on written request to the Board subject to the following conditions.
Period of Supply 1. 2. Upto 3 consecutive months in a year More than 3 consecutive months and upto 6 consecutive months in a year 3. More than 6 consecutive months and upto 9 consecutive months in a year 4. More than 9 consecutive months but less than one year
Tariff Rate Appropriate tariff plus 30 percent Appropriate tariff plus 20 percent
Appropriate tariff plus 15 percent
Appropriate tariff plus 5 percent.
2. The meter rent and other charges as provided in the appropriate tariff are applicable to seasonal loads and would be charged extra for the entire period of supply. 3. The supply would be disconnected after the end of the period unless the consumer wants the supply to be continued. Any reconnection charges have to be borne by the consumer.
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4. Consumer proposing to avail seasonal supply shall sign an agreement with the Board to avail power supply for a minimum period of 3 years in the case of HT, and 2 years in the case of LT category of supply. 5. The consumers must avail supply in terms of whole calendar month continuously. 6. The consumer is required to apply for seasonal supply and pay initial cost and security deposit as an applicant for normal electricity supply. 7. The consumer shall ensure payment of monthly energy bills within 7 days of its receipt. The supply will be disconnected if payment is not made on due date.
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PART - C: MISCELLANEOUS AND GENERAL CHARGES
11.0 11.1
The Miscellaneous and General charges approved by the Commission are as below: Meter Rent Particulars Kutir Jyoti a) Single Phase LT except Kutir Jyoti b) Three Phase LT Upto 100 Amps c) LT meter with CT d) 6.6 kV and 11 kV HTS-I (i) Metering at low voltage (ii) Metering at 6.6/11 kV e) 33 kV HT metering equipment for HTS-II and HTSS f) 132 kV EHT metering equipment for HTS-III g) 25 kV RTS h) 132 kV RTS Rs. 500 / month Rs. 700 / month Rs. 3000 / month Rs. 15000 / month Rs.3000/month Rs.15000/month Rs. 50/month Rs. 500 / month Applicable Charges Rs.10/month Rs. 20/month
11.2
Application fee for new connection / reduction of load / enhancement of load / request for permanent disconnection/ request for tatkal connection: No. (i) (ii) (iii) (iv) (v) (vi) Category / class Kutir Jyoti LT Single phase except Kutir Jyoti LT Three phase LT Industrial HT Connection For tatkal connection Rate Rs.20.00 Rs. 75.00 Rs. 200.00 Rs. 300.00 Rs. 750.00 Two (2) times the normal rate
11.3
Testing / Inspection of consumers installation: No. (i) (ii) Category / class Initial Test / Inspection Subsequent test and inspection Rate Free of cost Rs. 100.00 for single phase
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No.
Category / class necessitated by fault in installation or by not complying with terms and conditions of supply
Rate connection Rs. 200.00 for three phase LT connection Rs.800 for HT connection.
11.4
Meter Testing Fee: No. (i) (ii) (iii) (iv) (v) (vi) Category / class Single Phase meter (L.T.) Three Phase meter (L.T.) Three Phase meter with CT Trivector and special type meter 33 kV or 11 kV metering equipment 132 kV/220 kV metering equipment Rate Rs. 100.00 Rs. 200.00 Rs. 300.00 Rs. 1800.00 Rs. 5000.00 Rs. 8000.00
If the meter is tested at third party testing laboratory at the request of the consumer then the fees charged by the testing laboratory will be payable by the consumer.
11.5
Removing / Re-fixing / Changing of Meter / Meter Board at consumers request: No. (i) (ii) (iii) (iv) (v) Category / class Single Phase meter Three Phase meter Three Phase meter with CT Trivector and special type meter High tension metering equipment Rate Rs. 200.00 Rs. 400.00 Rs. 500.00 Rs. 600.00 Rs. 1200.00 Cost of material, as required, will be borne by the consumer
11.6.
Reconnection charge: Sl.No . (i) (ii) (iii) (iv) Category/class Single Phase supply, LT Three Phase supply other than LT industrial Three Phase LT industrial supply HT supply Rate Rs. 100.00 Rs. 200.00 Rs. 900.00 Rs. 3000.00
11.7
Supervision, Labour and Establishment charge for service connection:
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Sl.No. Category/class (i) (ii) (iii) (iv) (v) Single Phase LT Three Phase LT other than industrial Three Phase industrial HT For tatkal connection
Rate Rs. 400.00 Rs. 900.00 Rs. 1500.00 As per approved estimate Two (2) times the normal rate
11.8
Security Deposit: (a) The consumer (except Kutir Jyoti rural and Kutir Jyoti urban) shall pay initial security deposit equivalent to the estimated energy charges including fixed / demand charges for a period of two months or as per the provisions of Bihar Electricity Supply Code notified by the Commission. (b) All Central Government and State Government departments are exempted from payment of security deposit. However all public sector undertakings and local bodies shall pay security deposit, as applicable. (c) The amount of security deposit obtained from the consumer is liable to be enhanced every year, in April-May of next year on the basis of consumption during previous years or as specified in clause 7.15 of Bihiar Electricity Supply Code. In default of payment of additional security deposit, wherever payable after review, the service line may be disconnected on serving thirty days notice and connection thereafter can be restored only if the deposit is made in full along with the prescribed reconnection charges and surcharge @1.5% per month or part thereof on the amount of outstanding.
11.9
Interest on Security Deposit Security deposit made by a consumer shall bear interest as specified in Bihar Electricity Supply Code, payable at Bank rate notified by RBI from time to time. The interest will be calculated for full calendar months only and fraction of a month in which the deposit is received or refunded, shall be ignored. The interest for the period ending 31st March shall be adjusted and allowed to the consumer in the energy bill for May issued in June and in subsequent month (s), if not adjusted completely against the bill for the month of May.
12.0
The other terms and conditions of supply of electricity not specially provided in this tariff order will continue to be regulated by the provisions specified in the Bihar Electricity Supply Code notified by the Commission.
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PART D: FORMULA FOR FUEL AND POWER PURCHASE COST ADJUSTMENT
The approved fuel and power purchase cost adjustment (FPPCA) formula is given below:
FPPCA (Paise / kWh) Where, Qc = = RC1 = =
Qc(RC2-RC1)+Qo(RO2-RO1)+QPp(Rpp2 -Rpp1) (QPg + QPp) x (1-L) X100
Quantity of coal consumed during the adjustment period (in M.T) (SHR x QPg) (1+TSL)x1000 / GCV Weighted average rate of coal supplied ex-power station coal yard as approved by the Commission for the adjustment period in Rs. / M.T
RC2
Weighted average rate of the coal supplied ex-power station coal yard as per actual for the adjustment period in Rs. / M.T
Qo
= =
Quantity of oil (in KL) consumed during the adjustment period Generation (in MU) X Specific oil consumption approved by the Commission (ml. / kWh) Weighted average rate of oil ex-power station (in Rs./KL) approved by the Commission for the adjustment period
RO1
RO2 QPp
= =
Weighted average actual rate of oil ex-power station supplied (in Rs. / KL) during the adjustment period Power purchased from different sources and fed into Boards system (in MUs)
Rpp1 =
Average rate of power purchase as approved by the Commission (in Rs. / kWh)
Rpp2 = QPg =
Average rate of power purchased during the adjustment period (in Rs. / kWh) Boards own power generation (in MUs) at generator terminal approved auxiliary consumption
T & D loss as approved by the Commission or actual, whichever is lower.
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SHR
Station Heat Rate as approved by the Commission.
TSL GCV
= =
Transit and Stacking Loss as approved by the Commission. Weighted average gross calorific value of coal fired at boiler front during the adjustment period (in Kcal / Kg)
Note: 1) Amount of variable charges on account of change of cost of unknown factors like water charges, taxes or any other unpredictable and unknown factors not envisaged at the time of tariff fixation subject to prior approval of the Commission 2) Adjustment, if any, to be made in the current period to account for any excess / shortfall in recovery of fuel or power purchase cost in the past adjustment period, subject to the approval of the Commission. 3) While charging the FPPCA in the energy bills, the consumption and rate at which and the month for which the FPPCA is being charged must be indicated in the bills. The approved (FPPCA) formula is subject to following conditions: (i) The basic nature of FPPCA is adjustment i.e. passing on the increase or decrease, as the case may be. (ii) (iii) The operational parameters / norms fixed by the Commission in this tariff order shall be the basis of calculating FPPCA charges. The FPPCA will be recovered in the form of an incremental energy charge (Rs/kwh) in proportion to the energy consumption and will be forming a part of the energy bill to be served on monthly/bimonthly or any other periodical basis as specified by the Commission. (iv) Incremental cost of power purchase due to deviation in (respect of generation mix) power purchase at higher rate, etc. shall be allowed only if it is justified to the satisfaction of the Commission. (v) Any cost increase by the Board by way of penalty, interest due to delayed payments, etc. and due to operational inefficiencies shall not be allowed. (vi) FPPCA charges shall be levied on all categories of consumers
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(vii)
The data in support of FPPCA claims shall be duly authenticated by an officer of the Board, not below the rank of Chief Engineer on affidavit. Supported with the certified copy of energy bills of power purchase, transmission and RLDC charges, coal and its transportation cost, oil purchase bill and the quantity of coal and oil consumed during the month.
(viii)
Variation of FPPCA charge will be allowed only when it is five (5) paise and more per unit.
(ix)
The formula will be applied on monthly basis by BSEB after seeking the regulatory approval. The incremental cost per kWh due to this FPPCA arrived for a month shall be recovered in the subsequent month through energy bills and so on. The BSEB shall, however, be obligated to provide all relevant information to the Commission simultaneously and in any case where the Commission observes any discrepancies, the same will be adjusted during the subsequent month. This mechanism will provide administrative and regulatory simplicity.
(x)
The approved formula is subject to review, as the Commission may deem fit.
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9 Status of Directives issued by the Commission
9.1 9.1.1
General The Commission in its previous Tariff Orders had issued a number of directives to the Bihar State Electricity Board with an objective of attaining operational efficiency, efficient manpower deployment and streamlining the flow of information, which would be beneficial for the Petitioner, both in short and long term perspective. These directives aim at creating a conducive, competitive and healthy environment for the Petitioner to provide good quality of electricity supply and services to the consumers at optimum and affordable costs. This Chapter deals with the compliance status of the Directives and Commissions views thereon as well as new directives for compliance and implementation by the Petitioner.
9.1.2
In all previous Tariff Orders, the Commission had observed that while there was ample scope for reducing costs and increasing efficiency in the operations of BSEB, serious efforts appeared to be lacking. It is in the above context that certain directives were given by the Commission for compliance by the Board. The Commission expected that Board would take prompt action on the directives and monitor their implementation. Action is yet to be taken on most of the important directives, which could make significant difference in operational efficiency and cost. In some cases action has no doubt been initiated, but overall the seriousness with which the directives were issued by the Commission does not appear to have gone home.
9.1.3
Implementation of these will be monitored by the Commission every quarter and their non-compliance shall invite action under provisions of the Act.
9.1.4
Apart from these, there are certain other issues, not all of which may be directly related to tariff as such, on which the Commission has been giving directions in its Tariff Orders in the past. Since the Tariff Order covers in its scope analysis of the performance of the utility, such directives are also considered necessary. Accordingly such directives have also been included in this order.
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9.1.5
In the above background, the Commission is constrained to repeat most of the directives which were given in the last Tariff Orders which have not been fully compiled with, but also gives specific new directives.
9.2 9.2.1
Directives issued in Tariff Order of FY 2012-13: Fresh Directives

Directive No. 1: Capitalization of Assets
The Commission directs the Board to submit the progress report on execution of RAPDRP and other capital works being undertaken from FY 2011-12 onwards along with source of funding on quarterly basis and provide data related to achievement of loss reduction target under R-APDRP scheme. The Board is required to complete the project as per schedule and ensure that T&D loss reduction targets are achieved so that the central fund received under the scheme as loan is converted into grant as stipulated in the scheme. This will avoid any chance of passing on of the inefficiency of Board or its successor restructured companies to the consumers due to nonconversion of loan into grant because of non-achievement of loss reduction target under R-APDRP schemes 9.2.2
Directive No. 2: Strengthening the consumer complaint Redressal mechanism
The Commission directs the Petitioner to instruct the concerned field officers to be available in their offices on the specified days. Such days should be displayed at the notice board in the offices of the Petitioner for information of consumers and also publicised in newspapers having wide circulation in that area. This would ensure that the consumers can contact concerned officer of BSEB and have their grievances related to meter reading, billing etc. redressed. Further, the Commission directs the Petitioner to organize camps in the field for collection of dues and awareness creation for the benefit of the consumers. An annual status report in redressal of grievance of consumers shall be submitted by the Board. 9.2.3
Directive No. 3: Circle wise Distribution Loss reduction target
The Commission directs the Board to determine circle wise loss reduction on the basis of energy accounting and audit and fix circle-wise loss reduction target and prepare a detailed action plan for reduction of T&D losses. The Commission also directs the Board to monitor implementation of all schemes and actions for reduction of T&D losses and compliance report may be submitted to the Commission along with the next tariff petition.
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9.2.4
Directive No. 4: Cost of Supply study
The Commission directs
the Board to carry out appropriate studies backed by
energy accounting and audit to determine category wise and voltage wise T&D losses and cost of supply and submit it to the Commission along with the next tariff petition. 9.2.5
Directive No. 5: Business Plan and Investment Programme.
The Commission directs the Board or its successor restructured companies to submit the business plan for generation, transmission and distribution functions separately for a period of three years, i.e. FY 2013-14 to FY 2015-16 by September, 2012. 9.2.6
Directive No. 6: MYT filing for each function
The Commission directs the Petitioner or its successor restructured companies to file separate MYT petitions for generation, transmission and distribution functions for the first control period. FY 2013-14 will be the first year of the control period from FY 2013-14 till FY 2015-16.
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9.3
Directives issued in Tariff Order of FY 2006-07
Directive
Directive No.-1: Cent percent metering
The Commission directed the Board that no electricity connection will be released to any category of consumer without a meter. The Board shall take immediate action to provide meters to all such unmetered consumers and shall submit road map for providing meters to all these consumers and priority shall be given in providing meters to domestic and commercial consumers. Metering plan hence should be submitted to the Commission by 31st March 2007 so as to enable the Commission to review the progress and issue further directions in the matter as may be considered necessary.
Compliance status of directive The Board stated that it has set target of achieving 100% metering by March 2013. The Board has provided the status of metering as on September 2011: Consumer Metering: Sl. 1 2 3 4 5 6 7 System Metering: Sl. Category Nos. of Metering point Nos. of metered point Nos. of Defective / unmetered point Page 299 Single Phase (Govt. & Pvt.) LTCT (Govt. & Pvt.) 3 Phase Whole Current Meter (Govt. & Pvt.) 11 kV HT (Pvt.) 11 kV HT (Govt.) 33 kV (Pvt.) 33 kV (Govt.) Category Nos. of Consumers 16 54 458 589 3765 96838 2508420 Nos. of metered Consumers 16 54 280 589 2339 48858 1510735 Nos. of Defective / unmetered consumers 178 1426 47980 997685
BSEBs response in tariff petition of FY 2012-13
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Directive 1 2 3 11 kV HT (Govt.) 44670 13836 11 kV 1574 1038 536 30834 33 kV 660 370 290
The Board has not provided the breakup of private and government consumer meters for LTCT Meters ,3 Phase whole current meter and single phase. The Commission directs the Board to provide the detailed break up The Commission also directs the Board to submit a metering plan along with a report on defective meters and action plan for metering all unmetered consumers and for replacement of all the defective meters by 30th June 2012.The Board shall also th provide voltage wise numbers of feeders, their metering status by 30 June 2012. Thereafter, the Board is required to update the Commission on the progress made on a quarterly basis.
Commissions view in the Tariff Order of FY 2012-13
Directive No. 2: Replacement of Nonfunctional / Defective meters
The Commission directed the Board to report the number of non-performing / defective meters category-wise in the system as on 30.11.2006 along with an action plan to replace them and the report must be submitted by 31st January 2007 to the Commission.
Compliance status of directive
The Board informed the Commission that it has initiated a time bound program for replacement of all non-functional and defective meters. The target for 100% metering by March 2013 includes replacement of nonfunctional and defective meters also with provision of meters in the premises of unmetered consumers. The Board does not have separate data of nonperforming/ defective meters and unmetered consumers. The cumulative figure of total nonperforming/defective and unmetered consumer upto Sep11 was provided in response to the Directive 1 of FY 2006-07 in its petition for FY 2012-13. According to which the total 9,97,685 numbers of consumers meter are defective/ stop/ unmetered upto September, 2011.
The Commission directs the Board to submit the quarterly status report for replacement of the defective and non-functional th meters within 10 days of end of each quarter. The first such report shall be submitted to the Commission by 10 July 2012.
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Directive
Directive No. 3: Setting up of Independent Third Party Meter Testing Arrangement
The Commission directed that the Board should put in place an accredited independent third party meter testing arrangement in all districts under its licensed area and also prepare norms for allowing consumers to purchase their own meters duly tested and certified by such third party testing agency so that scope for consumer complaints is minimized and complaints that arise are settled expeditiously to the satisfaction of the consumers without the need for any recourse to consumer forum.
BSEBs response in tariff petition of FY 2012-13 The Board stated that it has set-up high-tech testing laboratory at Patna.
The Board has not stated about the putting in place an accredited independent third party meter testing arrangement in all districts. The compliance is vague.
The Petitioner is directed to submit the progress report on implementation on establishment of High-Tech testing laboratory in Patna, status of commissioning of four (4) nos. of computerized test benches obtained from PGCIL and action plan to obtain similar test benches in all circles for testing of meters and the latest status of the number of meters tested so far by the Board in its laboratory by 30th June 2012, as directed in Tariff Order for FY 2011-12. The Commission also reiterates that Board should put in place an accredited independent third party meter testing arrangement in all districts under its licensed area and also prepare norms for allowing consumers to purchase their own meters duly tested and certified by such third party testing agency.
Directive No. 4: Efficient meters reading billing and collection
Timely meter reading, billing and collection for energy consumed by the consumers can significantly improve the cash flow of the Board. The present system should be reviewed with a view to streamline the process and minimize the time between actual delivery of power and receipt of revenue. Supervisory officers must counter check the meter readings taken by the meter readers. Further, the area of meter readers should be changed every year. The Board should introduce billing through Meter Reading Instrument (MRI) for all HT consumers and large nondomestic consumers. Spot billing preferably by palm top computers may be introduced in the urban areas.
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Directive
The BSEB has outsourced meter reading, computerized billing and bill distribution all over Bihar. E-payment through debit card & ATM of Canara bank has been already started. Other banks like SBI, ICICI are likely to come in the collection network of BSEB. Payment by rural consumers facilitated through Sahaj Vasudha Kendras spread all over Bihar. Target- Jun12.
During the public hearing, it has come to notice of the Commission that meter reading and billing of consumers are not done properly and the electricity bills of the BSEB does not contain the required details. The details of FPPCA charges are not provided in the bills so the Commission directs the Board to take the immediate steps for proper metering and billing of the consumers and submit quarterly report with details of action taken for proper metering and details of billing and %age of improvement in collection.
Directive No. 5: Meter Reading of HT services
The monthly meter reading of HT services shall be entrusted to a committee of high level officers of the Board. All the HT services below 500KVA contracted maximum demand, meter reading may be done by the concerned Assistant Engineer and those above 500KVA by the concerned Executive Engineer. Further certain percentage of meter readings in each category of consumers shall be done by senior officers of the Board upto the level of Chief Engineer to control pilferage of electricity. BSEB shall issue suitable instructions in this regard immediately and the Board shall also review the percentage of check readings and take action in case of variation between normal meter reading read by meter reader and the check meter reading taken by the officers of the Board.
Compliance status of directive The Commission has director in Tariff Order that the senior officers shall also periodically visit HT services and take check readings to ensure that there are no malpractices in taking meter readings and the meters are not tampered etc.
The Board has not reported regarding percentage of meter reading in each category of consumers by Senior Officers of the Board, upto the level of Chief-Engineer to control pilferage of electricity. The Commission directs the Board to provide quarterly status of percentage check of meters reading and action taken in case of variation between normal meter reading read by meter-reader and the check meter reading taken by the Officers of the Board, each Area Board wise to the
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Directive Commission by 10 of the next month of quarter ending. First such report shall come to the Commission by 10 july, 2012..
th thJ
Directive No. 6: Replacement of old electromagnetic meters with static meters
A report on the status of metering, type of meters provided in HT and other high value LT installations along with a programme for replacement of such meters with static meters shall be submitted to the Commission by 31st January 2007.
BSEBs response in tariff petition of FY 2012-13 No specific response has been provided by the Board
Regarding installation of cent percent metering the compliance is noted in directive No.-1 so this is not dealt here separately.
Directive No. 7: Reduction of Transmission and Distribution (T&D) loss
A long term action plan for reduction of T&D losses for both technical and non-technical with relevant load flow studies be chalked out and submitted to the Commission by March, 2007. The Board should ensure reduction of the T&D losses to 38% during FY 2007-08 and 34% during FY 2008-09.
The Commission noted the action taken and directed the Board to submit the quarterly progress report.
Average AT&C losses of BSEB from April 2011 to August 2011 are 57.41%. The high AT&C losses despite corrective measures taken by BSEB are due to massive rural electrification and rural loads coming on distribution system of BSEB. This fact has been accepted by the Commission in its Tariff Order for FY 2011-12 dated 1st June, 2011.
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Directive
The Commission has directed the Board to submit a long term action plan for reduction of T&D loss, but the Board instead of submitting the plan stated that AT&C losses are 57.41% due to massive rural electrification and rural load. The Commission directs the Board to ensure that the Metering plan is synchronized with the T&D loss reduction plan. Specific long term map th for reduction of T&D loss shall be submitted by the Board by 30 June 2012.
Energy audit is an important and essential tool to identify the high loss (technical and commercial) areas in the system. For carrying out the energy audit, meters are required to be provided at all the feeders from 220KV to 11KV level and also distribution transformers on LT side. Though it is stated by the Board that meters are provided on a number of feeders, many of them are defective or non-functional. BSEB is directed to replace all such meters and provide correct meters on all feeders from 220KV to 11KV level as well as LT side of the distribution transformer on highest priority. The energy audit should be taken up first in all the towns with a population of fifty thousand and above. The first status report on the action taken for energy audit in all the towns should be reported to the Commission by 31st March, 2007 to issue further directives in this regard, if required.
Directive No. 8: Energy Audit and Demand Side Management
Compliance status of directive i) ii)
PFC has appointed M/s Pranat Engineering Ltd. under R-APDRP scheme to conduct third party energy audit. Experience gathered will be applied for non-RAPDRP area. BSEB is installing ring-fencing meters, system meters and consumer meters in all 64 towns covered under RAPDRP and 7 towns covered under ADB plan. The status as on 08th November, 2011 is as below: a. Ring Fencing (33 kV) - 5 b. Ring Fencing (11 kV) 48 c. Feeder Meter (33 kV) 5 d. Feeder Meter (11 kV) 4 e. Consumer Meter (33 kV) 0 f. Consumer Meter (11 kV) 9
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Directive g. DT Meter 10
The Board has not complied with the directive given by the Commission. Feeder-wise energy audit is not being carried over by the Board. The Commission directs the Board to provide the voltage wise details of numbers of feeders, feeder metering status and present working condition of feeder meters. Where the feeder meters have been installed, the Board is directed to provide the th energy audit report by 30 June 2012.The Commission also directs the Board to install meters on remaining feeders and regularly update the Commission on quarterly basis. .
Directive No. 9: Pilferage of Electricity
The need of the hour is to activate the organization to curb the pilferage of power within the premises of provisions of Indian Electricity Act 2003 and also the Indian Penal Code. A task force is to be constituted in different zones to which the entire licensee area is to be divided to carry out massive raid to arrest pilferage. In case of detection of such theft/pilferage, the concerned authority of the area and personnel attached to them, who have duties to supervise the work, have to be made answerable for punitive action. Those found committing mischief of pilferage should be booked and penal action should visit them.
To prevent theft of energy and to catch the culprits engaged in theft of energy, Board has created one Anti Power Theft (APT) cell at Patna. All supply circles have also a cell for APT. Regular raids are being conducted in different areas. Board at times has difficulty in getting force and magistrate for conducting raids. Recently on Boards request DGP, Bihar has sent instructions to field offices to provide required force to Board for carrying out raids. In addition, Board is installing meters of Secure Meters make which are tamper proof and can detect pilferage and can send message to computers and mobile phones. Recently Board has created a Special Task Force (STF) with selected engineers to organize raids to detect theft and to curb the power theft.
Action taken by the Board in organizing the raids to detect pilferage etc., of energy is noted. This has to be intensified further and the work of Taskforce is to be monitored at higher level. Wherever, if it is observed that malpractice or pilferage of energy took place due to negligence of the departmental personnel, suitable disciplinary action shall be initiated against such person. Energy audit will help in identifying high loss areas so as to concentrate on such areas. The Board shall also check the Page 305
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Directive energy supplied to HT and high value LT consumers on the basis of load flow from the power sub-stations.
The Board submitted the status report of raids carried out during FY 2008-09 and the position from April 2009 to Nov09.
The number of consumer premises raided during the period April-November 2009 is not adequate for the entire state. The raids have to be intensified concentrating more in all the towns, HT and high value LT consumers since bulk of energy is sold in towns and to HT and high value consumers. The Board is directed to submit quarterly reports on the raids conducted and energy billed and amount realized as a result of raids.
The Board stated that the Antitheft raids are being carried out by divisions, circles and headquarter STF team.
The compliance report is vague. Specific number of criminal cases filed after the directive, details of offenders, and amount assessed and realised under section 126 of the Act may be submitted by the Board along with the next tariff petition.
i) ii) iii) iv)
Special courts under section 135 of Electricity Act, 2003 has been constituted at Patna, Gaya and Muzaffarpur; Proposal of for setting up a special police station for PESU area to curb theft of electricity has been sent to the Government of Bihar; Special task force of BSEB is conducting super checks all over Bihar against theft of power; Criminal prosecutions and departmental proceedings in addition to other disciplinary measures initiated against officers and staff of BSEB found involved in unauthorized use of power by consumers;
th
The Commission reiterates its directive and directs the Board to provide report by 30 June, 2012 Specific number of criminal cases filed after the issue of directive, details of offenders, and amount assessed separately for each financial year from FY 2006-07 to FY 2010-11. The Board is also directed to submit circle-wise details of raids conducted, FIRs lodged, amount assessed, amount realized Page 306
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Directive for FY 2011-12. Thereafter the Board shall submit circle wise report on raid conducted and FIR lodged indicating the aforesaid on quarterly basis.
Directive No. 10: Enumeration of Agriculture Pump-sets & Other Service Connections
It is understood that there are a number of unauthorized agricultural pumpsets and other service connections connected to the system particularly in the rural areas. The Board shall get all agricultural pumpsets and other service connections enumerated to identify the unauthorized connections and get them regularized by providing meters. A report on the action taken to get agricultural and other connections enumerated to identify the unauthorized connection and to regularize them shall be placed before the Commission by 30th June, 2007.
Compliance status of directive The Board stated that it has discussion with BERC as directed. BSEB has conducted Pilot study of collection of data in some villages where 100% metering of agriculture services has been done. The data of pilot study is submitted.
As per the report submitted by the Board no specific analysis and assessment has been done. The Commission is of the view that the Board should have provided an action plan to take on the task on state level. However, the Board has failed to do so. It appears that the Board has not taken any tangible steps in this regards. Further, the Commission directs the Board to submit the action plan to identify such unauthorized connection and to regularize them and placed before the Commission by 30th June, 2012.
Directive No. 11: Assessment of Agricultural Consumption
Though energy consumed by agriculture sector constitutes a significant part of total energy consumption in the State, all the irrigation pumpsets in the State are unmetered and billed at flat rate basis. The BSEB for realistic assessment of energy consumption by agriculture sector, shall take steps to correctly assess consumption / load factor of agriculture consumers based on connected load, area, region, cropping pattern, number of crops, water sources, etc. by arranging proper metering for all irrigation pumpsets in the State wherever it is not done. Since it may take time, meanwhile meters shall be installed on LT side of Distribution Transformer exclusively connected to agriculture consumers/ pumpsets. This would give fairly reasonable assessment about consumption of electricity by pumpsets. The BSEB shall come out with an action plan for this job by 31st March, 2007 to be placed before the Commission and pursuant thereto the action taken on the plan shall also be made available to the Commission by
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Directive 31st July, 2007.
BSEBs response in tariff petition of FY 2012-13 No Response has been provided by the Board
As per the report submitted by the Board no proper analysis and assessment of Agriculture consumption has been done as directed in the Tariff Order for FY 2010-11. It appears that the Board has not taken any tangible steps for assessing the consumption pattern for agriculture consumers So the directive is again reiterated and the Board is directed to submit the th action plan for carrying out study in this regard in different parts of the state by 30 June 2012.
Directive No. 12: Regulation of Power Supply to Rural Areas
The Board may study the practices being followed in other States and draw out a scheme to regulate power supply to rural areas, particularly, to agricultural pump sets, and submit such a scheme to the Commission for consideration and approval by 31st March 2007.
No Specific Response has been provided by the Board
The Commission directs the Board to submit specific schemes being followed in the other states and in the Bihar State Electricity Board and future action plan for FY 2012-13 to regulate the Power supply to rural area particularly to Agriculture th pump sets by 30 June 2012.
Directive No. 13: Quality of Power Supply and Service
It is understood that a number of LT lines in the rural areas have no conductors and the villagers / consumers are without supply. The Board may drawout a scheme to restore all such lines and to strengthen the distribution system wherever required, as it is necessary to provide power supply to all consumers at a reasonable voltage and with minimum interruptions. The funds available from RGGVY and other Rural electrification schemes shall be availed to Page 308
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Directive improve the system. The Board shall submit its scheme to strengthen the transmission & distribution systems to the Commission by 31st March 2007.
to Consumer
On account of huge investment needed for restoration of lines which has no conductors, it is not possible for BSEB alone to revive the dead distribution system on its own. However, RGGVY program, electrification for such systems has been proposed and is likely to be completed
The Commission is not satisfied with the response of the Board and once again directs the Board to submit a comprehensive plan to improve the quality of supply and service to consumers and meet the Standards of performance as stipulated in the Regulation. The Board shall also provide quarterly report on the existing status where the Board has made effort to improve the Power supply by installing additional transformers and line capacity.
Directive No. 14: Management Information System
The Board is directed to take urgent steps to build a credible and accurate database and management information system with unbundled costs and expenditure of the three businesses of the Board viz. Generation, Transmission and Distribution to make information available on operational and financial issues and get such data updated on monthly basis. Advantage of IT must be taken to institute the MIS. Action must be taken urgently on this and the action taken shall be reported to the Commission by 31st March, 2007. Care must be taken to see that the next tariff petition is supported by an accurate and credible database.
No specific response has been provided by the Board
BSEB in the tariff petition for FY 2011-12 has stated that BSEB has issued letter of intent (LOI) to M/s SPANCO Ltd. Gurgaon for appointment as IT implementing Agency on 29.11.2010. As the IT implementation agency was appointed on 29th Nov10,
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Directive the Board is directed to submit the latest progress report on implementation of MIS to the Commission by 30 June 2012.
th
Directive No. 15: Annual Accounts of the BSEB
The Board is directed to accord highest priority and ensure that the accounts of these years are duly audited by Accountant General, Bihar by March, 2007. BSEB should file the ARR and tariff petition for the next year supported with audited accounts.
Compliance status of directive No Specific response has been provided by the Board. However the record shows that the annual account of the Board upto FY 2010-11 have been audited.
The Commission has noted the compliance. The Board shall file tariff petition with audited annual accounts as required in the BERC (Terms and conditions for determination of Tariff) regulations, 2007.
Sl.
Name of Consumer/ organization
Month & Year the Amount due
Energy charges Billed
Delayed Payment Charges
Total
Directive No. 16: Arrears
The Board should prepare area-wise list of consumers having huge arrears and furnish to the Commission in the format given below. The outstanding from the State Government Departments, Government Undertakings, local bodies and private parties shall also be furnished separately by 31st January, 2007 in the following format given below:
Action taken shall be reported to the Commission by 31st March, 2007.
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Directive
Name of Consumer/ organization Govt. Outstanding dues as on 31.03.2011 (Rs. Cr.) 3146.04 4981.52 8127.56 Private Total
Collection against dues (Rs.Cr.) 583.60 1185.33 1768.93
For FY 2010-11, BSEB has recovered arrears of Rs. 583.60 Cr. from Government departments and Rs. 1185.33 Cr. from Private consumers.
The details as desired in the directives have not been complied. So the Commission again reiterates its directive given in TO th for FY 2006-07 and directs the Board to submit the report to the Commission by 30 June 2012.
The Board should submit the details of recovery of arrears under the first OTS announced in April 2006 and also the recovery under the second OTS scheme in force from October 2006 onwards in format given below. The first report shall be submitted by 31st January 2007 and the second report after the scheme is over in March 2007. Sl. Name of Consumer/ organization Amount of arrears due Amount of DPS due Arrears Collected DPS Waived Total Collection
Directive No. 17: Collection of Arrears
Compliance status of directive For FY 2010-11, BSEB has recovered arrears of Rs. 583.60 Cr. from Government departments and Rs. 1185.33 Cr. from Private consumers.
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Directive Consumers Government Private Total 8127.56 4981.52 583.60 1185.33 1768.93 Outstanding dues as on 31.03.2011 (Rs. Cr.) 3146.04 Collection against dues (Rs. Cr.)
The Board been directed to furnish the details of the first and second OTS schemes but BSEB has not submitted such details The Commission is displeased with the efforts of the Petitioner for collection of arrear including DPS. The Commission again directs the Petitioner to take appropriate action on connected/ disconnected consumers not paying DPS and also prepare a strategy for collection of arrear and DPS from connected as well as disconnected consumers. The BSEB shall submit the action taken report by 30th June 2012.
Directive No. 18: Asset Register
The Board shall maintain separate asset registers for the 3 businesses viz. Generation, Transmission and Distribution. If such registers are already available, the same may be submitted to the Commission for perusal. In case such registers are not available the same may be got prepared by July, 2007
Compliance status of directive BSEB has initiated the process on the following aspects i) ii) For new asset created under schemes like RAPDRP, RSVY, RGGVY asset register are being created. Maintenance of asset register for all assets requires IT enabled mechanism huge financial investment; Shri Shunglu Committee had noted the poor financial health of utilities;
The directive was given in Tariff Order for FY 2006-07 since then the Board has not been able to prepare the assets register. This shows the lack of interest of the Board in preparation of assets register. The Commission directs the Board to conduct study for creation of function-wise Fixed Asset Registers (FAR). The Fixed Assets register should be prepared within the time bound manner and the Petitioner should submit the action taken report Page 312
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Directive and latest status of the preparation of asset register to the Commission in this regard by 30 submission of quarterly progress made for preparation of asset register.
th
June 2012 followed by
Directive No. 19: Time of Day (ToD) Tariff
Some consumer organizations have suggested to introduce TOD tariff which will help flattening of load curve and reduce peak demand. The National Electricity Policy also stipulates for introduction of TOD tariff. BSEB shall come up with a plan for introduction of TOD tariff and metering for HT consumers in the first phase followed by LT industries and Non Domestic consumers. Such plan shall be submitted to the Commission along with next tariff petition.
Compliance status of directive i) ii) 100% compliance achieved. Under R-APDRP scheme, ToD compliant meters are being installed.
The Commission has taken note of the steps taken by the Petitioner and directs the Board to submit the latest status report to th the Commission by 30 June 2012, the list of consumers (200 kVA and Above) in whose premises the ToD meters have been installed and billing is done on ToD Tariff.
Directive No. 20: Recovery of Fuel Price Adjustment from Consumers Paying Monthly Minimum Charges
An issue has been raised by a number of consumers/consumer organizations that the Board is recovering the fuel adjustment charges on monthly minimum consumption and not on the actual energy consumption by the consumer. Thus the consumer has to pay fuel adjustment charges for the energy actually not consumed. The Commission is of the opinion that the fuel adjustment charges shall be charged only on energy actually consumed and not on monthly minimum consumption. The BSEB shall submit a factual report in the matter to the Commission by 31st January 2007.
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Directive
BSEBs response in tariff petition of FY 2012-13 No Specific response has been provided by the Board
During the public hearing at various places it has come to the notice of the Commission that the details of units, rates and period for which FPPCA are charges are not shown in the Consumers bills. Moreover the field officials are not able to explain this to the consumers. Therefore the Board is directed to provide full details of FPPCA charges in the bills and submit th compliance with specimen copy of bills of atleast ten (10) supply circles relating to LT consumers to the Commission by 30 May 2012.
Directive No. 21: Fuel & Power Purchase Price Adjustment
A formula is approved by the Commission for adjustment of any increase / decrease in fuel prices and power purchase price. Any adjustments in the Fuel / Power purchase costs, the additional cost to be recovered from consumers or to be refunded shall be got approved by the Commission on furnishing all relevant details and data required to enable proper calculation.
The compliance has been noted by the Commission and it is directs the Board to get approval of any adjustment/ recovery of FPPCA from the Commission.
Directive No. 22: Adjustment of Payment of Current Bills against Delayed Payment Surcharge (DPS)
The issue shall be examined in detail and a report on the procedure followed shall be submitted to the Commission by 31stJanuary 2007 in order to enable the Commission to make a study of the issue and issue necessary directions in the matter.
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Directive
The Board is directed to furnish the updated status of the procedure followed for adjustment of payment of current bills th against DPS by 30 July 2012.The Board shall also submit category wise the details of DPS charged and recovered from th each circle of BSEB by 30 July 2012.
Directive No. 23: Organizing Operational Circles as Cost Centers
The Board was directed to draw out a action plan to organize the cost centres upto division level to make them accountable for their performance on profit and loss account and submit reports to Commission by 31st March 2007.
Compliance status of directive The Board stated that the Circle-wise P&L account for FY 2009-10 is provided in Annexure III along with the tariff petition of FY 2012-13.
The Commission directs to submit the circle-wise detailed plan on creation of profit centres on pilot program basis for approval of the Commission within the period of 3 months. The Commission also directs the Petitioner to submit a time bound Action Plan indicating their proposals for reduction in AT&C Losses, Energy Audit, Realisation of Arrears, Improvement in Collection System, Installation of Aerial Bunch Cable Conductors in High Loss prone areas and replacement of Electromechanical Meters with Static Meters for such pilot area.
Directive No. 24: Performance of BSEBs own generating stations and their parameters
The Board shall submit a detailed report on the current status of R&M and restoration of generating units at both the power stations along with report on action taken about performance parameters of its generating stations by 31st January, 2007.
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Directive
Compliance status of directive In the Tarff petition the Board has stated that BSEB has taken up R&M work of Unit VI and VII of BTPS under the RSVY scheme sanctioned by the Planning Commission, Government of India.
The Board is directed to furnish the updated status of R&M activities of unit no. VI and VII of BTPS by 30th July 2012.
Directive No. 25: New Generation Projects
The BSEB is directed to expedite the process of setting up of new generation projects in the State and submit quarterly progress report on the same to the Commission. The first such report shall be submitted in April 2007.
BSEBs response in tariff petition of FY 2012-13 No specific responses has been provided by the Board
The Board is directed to furnish the updated status of new generating plant planned to be installed in the state indicating the likely date of commissioning on quarterly basis and first such report be submitted by 10st July 2012
Directive No. 26: Employee cost
As per information made available by the BSEB, the employee cost of BSEB is high which stands at about 40% of the total revenue income from sale of power at existing tariff. It works out to be around 120 paise per kWh of energy sold, whereas, in other states, even where the State Electricity Board has not been restructured, it is of the order of 60 paise per kWh of energy sold. There is no infrastructure in some crucial and important activities whereas there is excess staff in some departments, which are not so significant. The BSEB is directed to enforce economy and austerity measures in their operations and take urgent steps to reduce establishment cost by utilizing the existing man-power optimally imposing restrictions on creation of posts, introducing revised work load norms and also reducing posts which are not significant BSEB shall set up a committee to suggest and recommend deployment of existing man-power to achieve optimum utilization of available work force. BSEB is also directed to identify the surplus staff and deploy them, after proper training, in the areas of customer service, such as meter reading, billing Page 316
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Directive and revenue realization, so as to provide better service to the consumers.A report on the action taken may be sent to the Commission by 30th June 2007.
The detailed zero-based analysis of man-power has been done. BSEB is working with man-power lesser than zero based manpower requirement. Circular has been issued for austerity and lesser expenses to all officers.
The directives given in previous Tariff Order has not been complied by the Board. No study report in this regard has been st submitted by the Board till date. So, the Board is directed to submit the study report and analysis done by 31 July 2012.
Directive No. 27: Energy conservation
A well-known proverb is that energy conserved is energy generated and to conserve energy, the consumers are required to be well educated by way of demonstrations, holding meetings at various levels and through print media so that energy consumption can be reduced considerably by adopting economy measures such as use of energy efficiency lighting, high efficiency and standard make household appliances, high efficiency pump sets preferably with labels of Bureau of Energy Efficiency (BEE) and other energy conservation devices. All categories of consumers should be well apprised of the newly developed latest energy conservation devices so that the energy conserved can be utilized for more productive purposes and in consonance with direction issued by the Ministry of Power, Government of India, it shall be made mandatory to use ISI mark motor pump sets, power capacitor, foot / reflex valves in all new connections in agriculture sector.
Compliance status of directive Pilot project for demonstration of energy efficiency means and measures in collaboration with BREDA and BEE (Bureau of Energy Efficiency) has been planned under PESU area. BREDA and BEE have to arrange the pilot projects.
Commissions view in the
Since FY 2006-07 the Board has not provided the satisfactory response. The Board is directed to submit the latest report on
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Directive implementation on energy conservation measures and creating awareness among consumers by 30 June 2012.
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Tariff Order of FY 2012-13
Directive No. 28: Investment Programme
It is observed that the Board has neither submitted any future investment programme nor the details of capital works in progress (CWIP) with the tariff petition. The BSEB is directed to submit within next three months their investment programme for the next 5 years and details of CWIP. A quarterly progress report on major investment works should also be furnished regularly to the Commission and the first such report for quarter ending March, 2007 be submitted in April 2007.
The Board was directed to submit a quarterly progress report on major investment works but the same has not been complied by the Board and has not submitted any such compliance in the tariff petition for FY 2012-13. The detailed investment program for FY 2012-13 and actual investment done for FY 2011-12 shall be provided by the Board and submitted to the th Commission by 30 June 2012.
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Directive No. 29: APDRP Schemes
The status of implementation of these schemes, amount utilized upto 31 December, 2006, the benefits accrued by way of increase in metered sales, reduction of distribution loss, improvement in quality of supply, revenue etc. shall be reported to the Commission by 31st March 2007.
Compliance status of directive i) ii) iii)
APDRP has been short closed and restructured as RAPDRP. As such it will be premature to assess the benefits accrued to BSEB under APDRP. R-APDRP part-A is being implemented in 64 towns and ADB plan is being implemented in 7 towns. The benefit under these programmes can be assessed after completion of the same. th Under R-APDRP, the status of metering as on 08 November, 2011 is as below: Page 318
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Directive a. b. c. d. e. f. g. Ring Fencing (33 kV) - 5 Ring Fencing (11 kV) - 48 Feeder Meter (33 kV) - 5 Feeder Meter (11 kV) - 4 Consumer Meter (33 kV) - 0 Consumer Meter (11 kV) - 9 DT Meter 10
The Board shall submit the benefits accrued by way of increase in metered sales, reduction of distribution loss, improvement in quality of supply, revenue etc. for FY 2009-10, FY 2010-11 and FY 2011-12 by 30th June 2012.
Directive No. 30: Registered and effective consumers
It is observed from the tariff petition filed by BSEB that the consumers are categorized as registered and effective. The registered consumers are those entered in the books and effective consumers are those whose services are alive. Thus a large number of consumers who are on books (registered) are not live and billed. It could be possible that some of these consumers might be availing electricity. The services of consumers which are not live for more than three months should be given notice for clearing the arrears and getting the supply restored within a specified time. If they fail to do so, the connection of these consumers shall be dismantled and action taken to realize the dues. Such services shall be closely monitored by the Board and stringent action under the provisions of the Electricity Act, 2003 against such consumers be taken who are availing supply. The service connections having no dues and not willing to take reconnection should be removed from the books immediately. A report on the action taken shall be sent to the Commission by 31st March, 2007.
No Response has been provided by the Board
As per directives the disconnected consumers having dues are to be closely monitored by the Board and stringent action to be taken for realization of dues. The current status of registered and effective consumers shall be furnished to the th Commission by 30 June 2012 and the quarterly report on monitoring of collection/ realization of dues from disconnected Page 319
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Directive consumers having dues shall be submitted to the Commission.
Directive No. 31: Cost of supply and cross subsidy
As per Clause (g) of section 61 of the Electricity Act, 2003, the Commission is to ensure that the tariff progressively reflects the cost of supply and cross subsidy is reduced within a specified period. In this context, the Commission directs the Board to carry out a study to ascertain voltage-wise and consumer category-wise cost of supply. This is necessary for the purpose of better tariff design as also to find out the nature and extent of cross subsidy. The BSEB shall carry out the study and submit the study report to the Commission within a period of six months.
The Board stated that other SEBs and utility are being contacted for their methodologies.
The Commission again reiterates its directive given in Tariff Order for FY 2006-07 and shows its displeasure on the inability of the Board to conduct the said study. The Commission directs the Board to submit the information on action taken for working out voltage wise Cost of Service (CoS) study by 31st July 2012.
Directive No. 32: Restrictions on consumption of Energy
Since generation of energy is quite insignificant in the State and the power available including that purchased from other agencies is not adequate, the Board has been resorting to unscheduled load shedding. Though some part of the urban areas are privileged in this matter for getting supply of electricity, rural area is the worst casualty. The view of the Commission is that if one does not have adequate resources to cater to the requirement of the vast masses who are needy, rationing is the only option in a welfare state where everyone has equal right for use of a scarce commodity. It is high time in the State that people should be conscious in the matter of energy consumption and should put restriction on use of electricity voluntarily which would be self-regulating, though it cannot be ruled out that exigency may arise when it could be regulatory compulsion for mandatory restriction on consumption of electricity. The Commission directs the Board to educate the consumers to cooperate with the Board in restricting the use of electricity by voluntary effort.
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Directive The Board stated that i) ii) A demonstration project with the help of BEE and BREDA has been organized in the PESU area. Instruction has been issued to the officers of the Board to spread the energy efficiency and economy awareness during consumers meet.
As directed, Board is required to educate the Consumers restricting the use of electricity by voluntary effort. But it appears that no such action has been taken to educate the consumers. The Board is directed to submit the latest report on creation of awareness for implementation on energy conservation th measures and creating awareness among consumers by 30 June 2012.
Directive No. 33: SCADA and Data management
The Commission feels that for effective working of distribution system a time bound programme for implementation of SCADA and data management is essential. A report on implementation of such a scheme should be submitted by the Board for approval by the Commission by March, 2007.
The Board shall provide the latest status of SCADA and data management implementation by 30 June 2012.
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9.4
Directive
Directive No. 1: HT Consumer cells in BSEB
The contribution to the revenue of the Board by HT industrial consumers is substantial. These consumers are cross subsidizing the domestic and agricultural consumers who are supplied power below the average cost of supply. It is therefore expected that the Board provides them quality power and service to them. Their complaints regarding electricity supply should be attended promptly. Keeping this in view, The Commission directed the Board to establishes a HT cell in the head office at Patna and at important Urban Industrial Centres in the state. The cell at the headquarters should be headed by an Executive Engineer with supporting staff. The cell shall be a single window contact for attending to all their problems. The Board shall prepare a scheme for establishment of such cells and ensure that these are functional within a period of three months. Compliance may be reported by 31st December 2008.
Compliance status of directive No Specific response has been submitted by the Board.
The no. of complaints/ problems received during FY 2010-11 and FY 2011-12 and resolved by the HT consumer cell of BSEB headquarter shall be furnished to the Commission by 30th June 2012, and thereafter half yearly progress report shall be submitted by the Board.
Based on the data furnished by the Board for FY 2007-08, the Commission observed that HT consumers contribute 40% of the total revenue, LT consumers contribute 8.3% of the total revenue and LT commercial consumers contribute 11.5% of total revenue. In this regard, the Commission directed the Board to give priority to these High value Consumers in the following operational aspects: Replacement of electromagnetic meters by static meters Replacement of stopped / defective meters. Checking of all H.T services by the Special Task Force officers atleast once in 3 months. Checking of Nil consumption & Bill stopped services which were earlier recording about 1000 units per month.
Directive No. 2: Issues relating to high value consumers
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Directive High value LT industrial commercial services and domestic consumers (monthly bill exceeding Rs 1000) to be inspected by Special Task Force atleast once in six months.
An online portal system for attending the problems of HT consumers shall be introduced by the BSEB and status report th shall be submitted to the Commission at half yearly interval starting 30 June 2012.
Directive No 3: Monitoring of HT and high value LT Consumer meter readings
The Commission directed the Board to issue necessary instructions to the concerned officers and staff and monitor the compliance with respect to the instructions given for meter reading. The Commission also directed that the Board shall cause necessary instructions to the concerned officers and staff and monitor the st compliance. Action taken may be reported to the Commission by 31 December 2008.
The updated compliance status report shall be submitted by the Board to the Commission by 30 June 2012.
th
Directive No. 4: Prompt release of supply to new consumers
The Commission directed the Board to promptly deal with new applicants approaching Board for new connections and take action avoiding delays at every level. The Board is directed to procure the required number of meters and keep them in stock. It also noticed that in certain cases release of new connections was being delayed for want of meters. In such cases, it directed the Board to allow consumers to purchase their own meters of specified quality, capacity and make.
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Directive
During the public hearing at different place, consumers submitted before the Commission that the new connections are not released in time and standard of performance is not maintained by the Board. So, the Commission directs the Board to ensure to conduct survey of rural areas, develops a marketing and awareness programme for such areas and provides new connections through special camps. The Commission also directs the Board to develop an action plan for the above and submit the same to the Commission within three months of the Order. Thereafter, the Board shall regularly submit the Compliance report on quarterly basis. The Commission also directs the Petitioner to take all the steps to implement the standards of performance and ensure the new connections are given in time as per the Standards of Performance Regulations.
Directive No.5: Reduction of AT & C Losses
As per tariff petition for FY 2008-09, the AT&C losses for FY 2006, FY2007 and FY 2008 are very high. The segregation of technical and commercial losses through proper loss study shall be done and report on this shall be submitted before the Commission by December, 2008. The Commission directed the Board to collect 100% of the monthly bills amount and another minimum 10% of the arrears outstanding every month.
The Commission has directed to the Board to collect 100% of monthly bills amount and another minimum 10% of the arrears amount every month, but the Board has not submitted that they are complying. The Commission reiterates the directives 1, 6 and 7 of Tariff Order for FY 2006-07 and for collection of amount as directed in the Tariff Order for FY 2008-09.
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9.5
Directive
Directive No. 1: Pre paid meters
The Commission directed the Board to provide prepaid meters to some domestic consumers as a pilot study to encourage and make the consumers to observe the advantages of having prepaid meter facility. It also observed that subsequently Board may suggest the consumers to purchase the prepaid meters at their own cost by offering some rebate say about 10% in energy charge, with no security for prepaid consumers. The Commission directed the Board to furnish the report on the action taken in this regard by 30th April 2011.
Compliance status of directive The Board stated that the CEA is in process of specification formulation and finalization of pre-paid meters. Due to high cost of pre-paid meters. Board is yet to launch the scheme of pre-paid meters to selected consumers under pilot.
The Commission stated that the compliance may be reviewed with the next tariff petition and will be discussed separately.
The Board informed the Commission that it has sent suggestion to CEA for finalization of specification, formulation and finalization of pre-paid meters. The Board stated that it has got learning from Delhi and Kolkata. The Board informed that Manufacturers have been invited for presentation on the same in Sept 2011. The Board highlighted difficulty in implementation of pre-paid meters like Accounting difficulty, Software updation required (for charging FPPCA) and instances on by-pass of meter.
The Petitioner is directed to furnish cost-benefit analysis of implementing pre-paid metering on pilot basis especially for consumers with high arrear and Govt. connections within three months of issue of this order.
Directive No. 2: Star Rating Distribution Transformers
The Commission directed the Board to go in for procurement of distribution transformers up to 200 kVA with minimum of two star rating or star level. This was applicable for purchase of all new transformers for which tender has not been so far floated / published in the newspaper by the Board. The Commission has directed the Board to furnish the report on the action taken in this regard by 30th April 2011.
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Directive
Compliance status of directive The Board stated that it is not procuring Star Rating DTs due to higher cost of such DTs and is collecting data and feedback from Kolkatta and Delhi on such transformers. The Board informed that it is studying the financial viability of installing star rating DTs.
Commissions view in the Tariff Order of FY 2011-12 The Commission advised the Board to discuss this.
The Board stated that the committee has been formed to make technical specification and procurement of next Lot of DTs will be star rated.
The Board is directed to follow the specification of electrical equipments as specified by BEE under the standard and th labeling program and furnish compliance report to the Commission by 30 June 2012 and thereafter on quarterly basis.
Directive No. 3: Providing Meters at LV side of all Distribution Transformers
The Commission directed the Board to provide meters to all the unmetered distribution transformers within six months. It also directed the Board to undertake energy accounting in the areas where meters have already provided for the distribution transformers and submit the copies of such reports to the Commission every month. The Commission directed the Board to furnish the report of energy accounting in respect of those distribution transformers in which meters have been installed by 31st March 2011.
Compliance status of directive The Board stated that is has already installed 16,035 distribution transformer meters under APDRP scheme and 7,064 DT meters are going to be installed under RAPDRP Scheme.
The Commission has noted the compliance.
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Directive No specific response has been submitted by the Board.
The Commission has directed the Board to furnish the report of energy accounting in respect of those distribution transformers in which meters have been installed. But the Board has not complied and submitted in report regarding the energy audit results of those distribution transformers in which meters has been installed. A Comprehensive status report on the functioning/ working status of the installed DT meters and result of energy audit done and the action plan for future DT meter installation shall be submitted to the Commission by 30th June 2012.
Directive No. 4: CFLs to Kutir Jyoti (Rural) Consumers
The Commission directed the Board to provide CFL lamps upto 30 watts instead of 60 / 100 watts incandescent lamps to the Kutir Jyoti consumers (to be added during RGGVY programme). The Commission also directed the Board to furnish the Action Taken Report in this regard by 31st January 2011.
Compliance status of directive The Board replied that under RGVVY program, the service connections to BPL categories are being given in which CFL lamps upto 18 watts are being provided. Inspection by field officers shows that the beneficiaries use more than 30 Watt lamps and other gadgets in their premises.
The Commission has noted the compliance.
No specific response has been submitted by the Board.
The Commission directs the Board to submit the number of CFLs provided to Kutir Jyoti consumers and future action th plan to the Commission regularly on half yearly basis. The First such report shall be submitted by 30 June 2012.
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Directive The Commission directed the Board to make arrangements for supervision of the construction of the transmission lines from renewable generation sources when approached by the developer, and facilitate to connect the line to the Boards network. The Commission directed the Board to furnish the report of such transmission lines for evacuating energy from RE sources by 31st March 2011.
Directive No. 5: Connecting up Renewable Energy source to the State Grid
Compliance status of directive The Board submitted the status of following transmission lines: 1) GSS Ramnagar to Lauriya Sugar Mills (West Champaran) 2) GSS Motihari to Sugauli Sugar Mills (East Champaran) 3) GSS Ramnagar to Harinagar Sugar Mill (order recently placed) The Board also stated that all the three projects are being executed on turn-key basis.
Commissions view in the Tariff Order of FY 2011-12 The Commission has noted the compliance.
No specific response has been submitted by the Board.
The Board shall furnish the updated status to the Commission regarding the lines constructed to evacuate power generation from renewable source and the progress achieved in this regard on half yearly basis.
Directive No. 6: Demand Side Management (DSM)
The Commission directed the Board to take effective steps for implementation of demand side management in the state. The Commission also directed the Board to report the status of implementation of DSM and TOD Tariff quarterly, with First such report upto 31st March 2011 to be furnished to the Commission by 30th April 2011.
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Directive
Compliance status of directive The Board stated that for implementation of TOD based tariff, software in the HT meters have been installed. The st Board will submit report on the same by 31 May 2011.The Board stated that during monthly consumer meetings, the advantages of DSM are explained to local consumers by the Boards officials.
Commissions view in the Tariff Order of FY 2011-12 The Commission stated to review the status after 3 months
The Board stated that during the consumers meeting the consumers are made aware of DSM. The Board has organized a demonstration project of energy conservation in PESU area in collaboration with BEE (Bureau of Energy Efficiency) and BREDA.
The Petitioner is directed to submit the latest progress report on implementation on DSM measures and ToD tariff on quarterly basis to the Commission.
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9.6
Directive The Commission directed the Board to file tariff petition for FY 201213 on or before 15th November 2011. This will be essential to ensure that the new tariff is applicable from 1st April 2012.
Directive No. 1: Timely Submission of tariff petition
Compliance status of directive The Board submit that it has complied with the directive
The Commission noted the compliance. However, the Commission directs the Board to compile and maintains the data, related to regulatory requirement/ ARR on a regular basis and makes available the copy of the same to the Commission on quarterly basis.
Directive No. 2: Energy Audit
The Commission reiterated its earlier Directive No. 8 issued in Tariff Order for FY 200607, directing the Board to replace meters and provide correct meters on all feeders from 220KV to 11KV level as well as LT side of the distribution transformer on highest priority as well as to undertake energy audit in all the towns with a population of fifty thousand and above.
Compliance status of directive The Board stated that it has set target of achieving 100% metering by March 2013. The Board provided the status of metering as on September 2011 as given below: Consumer Metering Sl. 1 2 33 kV (Govt.) 33 kV (Pvt.) Category Nos. of Consumers 16 54 Nos. of metered Consumers 16 54 Nos. of Defective / unmetered consumers -
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Directive 3 4 System Metering: Sl. 1 2 3 11 kV HT (Govt.) 44670 13836 11 kV 1574 1038 33 kV 370 Category Nos. of Metering point 660 Nos. of metered point Nos. of Defective / unmetered point 290 536 30834 11 kV HT (Pvt.) 589 589 11 kV HT (Govt.) 458 280 178
The Board stated that PFC has appointed M/s Pranat Engineering Ltd. to conduct third party audit under R-APDRP scheme. The Board stated that the experience from this will be applied for non R-APDRP area.
In regard to system metering status under the category 11 kV HT (Govt.) the figures of metering points of 44,670 as provided by the Board, is not clear. The Commission is of the view that little efforts put in by the Petitioner in this regard may result into drastic reduction of distribution losses. The Petitioner is, therefore, directed to provide meters at all the distribution transformers in loss prone areas within three months from the date of issuance of this Order and there after carry out complete energy audit upto 11 kV level for the entire system and upto LT level on at least one 11 kV feeder in th each Circle and submit a comprehensive report of the results by 30 June 2012.
Directive No. 3: Estimation of energy consumption levels of Kutir Jyoti Consumer Category & Agriculture sector
The Commission directed the Board to undertake two studies (a) to estimate average energy consumption of the Kutir Jyoti consumers and (b) to estimate average energy consumption of the IAS I consumers. Legitimate costs that accrue to the Board to conduct the study may be considered in the ARR in the next Tariff Order.
Compliance status of directive The Board submitted that it has conducted pilot studies to estimate average energy consumption of 10 KJ and IAS consumers at Bihar shariff in one village and the reports have been submitted along with the petition.
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Directive The Board is directed to carry out said study on the basis of larger representative sample to determine average energy consumption for adoption.
Directive No. 4: MYT Compliance
The Commission directed the Board to submit an Action Taken Report (ATR) on its preparedness to move to MYT framework for tariff determination not later than 30th September 2011
Compliance status of directive The Board stated that MYT compliance will be done by successor companies after proposed unbundling of BSEB.
The Commission directs the Petitioner or its successor restructured companies to file the Business Plan and MYT tariff petition for generation, Transmission and distribution function separately for the control period starting from FY 2013-14 onwards within the stipulated time.
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10 Generation, Transmission, Wheeling Charges and Open Access Charges
10.1
Generation Tariff
10.1.1 The generation tariff is computed based on the generation ARR and the net generation approved in para 6.35.3 of the chapter 6 of this tariff order. The approved generation tariff is given in the table below:
Table 156: Generation Tariff Net generation (MUs)
Net Generation (MU) 279.00
Fuel (variable) Fixed costs Variable cost Costs (Rs. (Rs. (paise/ kWh) Crores) Crores) 103.52 114.85 371.03
Fixed cost / kWh Total cost / KWh (paise/kWh) (paise/kWh) 411.64 782.66
10.1.2 Accordingly, the Commission approves generation tariff of 782.66 paise / kWh for the FY 2012-13. 10.2 Transmission Tariff
10.2.1 The transmission ARR, as approved in para 6.35.3 of chapter 6 is Rs 167.61 Crores. The approved transmission tariff is given in the table below:
Table 157: Transmission Tariff (in Paise/kWh)
Sl. 1. 2. 3. 4. 5.
Particulars Total costs of transmission Energy available for transmission Transmission losses assumed Energy delivered to distribution Transmission tariff (14)
Units Rs. Crores MU % MU Ps./kWh
Transmission Tariff 167.61 11,786.29 4% 11,314.84 14.81
10.2.2 Accordingly, the Commission approves transmission tariff of 14.81 paise/ kWh for the FY 2012-13. 10.3 Wheeling Charges
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10.3.1 The distribution ARR as approved in para 6.35.3 of chapter 6 is Rs 6317.62 Cr. The wheeling charges have been computed on the basis of approved costs of BSEB for its distribution wire business and the total energy expected to be wheeled through its distribution network. The distribution cost for maintaining and operating HV network as per the financial accounts of FY 2010-11 by BSEB is 19.3% of the total cost of operating and maintaining distribution wires business of BSEB. In the absence of segregated data on costs of operation of 33 kV and 11 kV networks, it has been assumed that the two costs are equal. The Commission would revise this assumption as reliable and concrete data on operating costs (voltage wise) becomes available to it during review/true up. 10.3.2 The wheeling charges worked out for 33 kV voltage level are given in the table below:
Table 158: Wheeling charges at 33 kV Voltage Level
Sl. 1. 2. 3. 4. 5. 6. 7.
Details Energy input into transmission system Losses in transmission system EHV sales (as approved by the Commission) Energy input into 33 kV system [1(2+3)] Total distribution cost Wheeling charges for 33 kV voltage level (item 64)
Units MU % MU MU Rs. Cr. Ps./kWh
Approved wheeling Charges 11,786 4.00% 1,006.06 10,308.78 1,135.92 111.46 10.81
Distribution cost for 33 kV voltage levels (assuming 9.81% of item 5) Rs. Cr.
10.3.3 Accordingly, the Commission approves wheeling charges at 10.81 paise/kWh for 33 kV voltage level for the FY 2012-13. 10.3.4 The wheeling charges determined for 11 kV voltage level are as given in table below:
Table 159: Wheeling charges for 11 kV Voltage Level
Sl. Details 1. 2. 3. 4. 5. 6. 7. Energy input into 33 KV system Losses in 33 KV Energy sales in 33 kV system as approved by the Commission Energy input into 11 kV system [1-(2+3)] Total distribution cost
Units MU % MU MU Rs. Cr.
Approved wheeling Charges 10,308.78 6% 872.03 8,818.22 1,135.92 111.46 12.64
Distribution cost for 11 kV voltage levels (assuming 9.81% of item 5) Rs. Cr. Wheeling charges for 11 kV voltage level (item 64) Ps./kWh
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10.3.5 Accordingly, the Commission approves wheeling charges at 12.64 paise/ unit for 11 kV voltage level for the FY 2012-13. 10.4 Open Access Charges
10.4.1 The Commission feels that in the current scenario where energy and peak shortages are in the range of 50%, the HT consumers should be provided a facilitative open access framework for procurement of power from sources other than BSEB. For Open access to become a feasible option for HT consumers open access charges should be rational so that the cost of delivered power (from sources other than BSEB) is comparable to retail tariff. 10.4.2 Pursuant to Section 39, 40 and 42 and all other enabling provisions of the Electricity Act, 2003, the Commission notified the Terms and Conditions for open access Regulations on 20th May 2006. The Commission through these regulations has introduced open access in phases in Bihar as given below, having regard to operational constraints, and other relevant factors.
Table 160 : Phase Category of Consumers Open Access to be allowed from
Sl. 1. 2. 3. 4.
Phase Phase-I Phase-II Phase-III Phase-IV
Category of Consumers Consumers with demand of 15 MW and above Consumers with demand of 10 MW and above Consumers with demand of 5 MW and above Consumers with demand of 1 MW and above
Open Access to be allowed from 1-Jun-06 1-Dec-06 1-Dec-07 1-Dec-08
10.4.3 The consumer who seeks open access in accordance with these regulations will have to pay transmission charges, wheeling charges, cross subsidy surcharge, additional surcharge and charges to SLDC. The applicability of these charges to any open access consumer shall be as provided in the regulations for open access. In the following section all the charges to be paid by consumer seeking open access are being determined. Transmission Charge 10.4.4 The Commission has computed the transmission tariff as provided in clause 75 of the BERC (Terms and conditions for determination of Tariff) Regulations, 2007. The sum of allocated capacity to all long term transmission customers of the state transmission system has been taken into consideration. Based on the transmission cost worked out earlier the approved transmission charge for open access consumers for the FY 2012-13 is as given in table below:
BERC
Table 161: Transmission Charge
Particulars Transmission ARR Average transmission capacity (MW) - Allocated capacity to all long term Open Access Customers of the State Transmission charges for long term open access customers (Rs. /MW/Month) Transmission charges for short term open access customers (Rs./MW/Day) 167.61 (Rs. Crores) 2620 MW Transmission ARR (Average transmission capacity X 12) = 53,310 Transmission ARR x 0.25) (Average transmission capacity X 365) = 438.16
10.4.5 The Commission decides that the transmission charges in cash will be Rs. 53,310/ MW/ month or part thereof for long term open access consumers and Rs. 438.16/ MW/ day or part thereof for short term consumers. In addition transmission losses of 4% will be reduced in kind from the energy input (i.e. energy injected at the point of injection) at the point of delivery. Wheeling Charges 10.4.6 For the energy input at 33 kV the wheeling charge shall be at 10.81 paise/kWh. In addition 6% of energy in kind will be deducted from the energy input, towards assumed losses in 33 kV network. 10.4.7 For energy input at 11 kV the wheeling charges shall be 12.64 paise /kWh. In addition, 8% of energy in kind will be deducted from the energy input towards assumed losses in 11 kV network. Open Access Charges 10.4.8 The Open access charges shall be paid as per the table given below if the injection and drawl points of the open access customer are at different voltage levels.
Table 162: Open Access Charges
Drawl Transmission Injection Transmission Charges plus transmission losses Transmission Charges plus transmission losses Transmission Transmission charges plus wheeling charges of 33 kV. Losses of both transmission and 33 kV network shall be payable Wheeling charges of 33 kV plus losses of 33 kV network Transmission charges Transmission Charges plus wheeling charges of 33 and 11 kV network shall be payable. The losses of transmission, 33 and 11 kV network shall be payable Wheeling Charges of 33 and 11 kV network. Losses for 33 and 11 kV shall also be payable Wheeling Charges of 11 kV 33 KV 11 KV
Transmission
33 KV 11 KV
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11 KV plus losses of 11 kV network
SLDC Charges 10.4.9 Open access consumer shall pay all charges payable to the State Load Dispatch Centre (SLDC), as determined by the Commission under section 32 of the Act and as per the Regulation 19 (1) of Terms and Conditions for Open Access Regulations, 2006 of BERC. 10.4.10 The Annual SLDC and Operating charges for the present have not been determined separately as till date SLDC is not an independent entity but continues to be a part of BSEB with no separate accounts. The Commission believes that expenses incurred by the SLDC are a part of the transmission expenses of BSEB. The Commission has determined the revenue requirement for transmission function of BSEB and consequently the revenue requirement of SLDC are a part of the revenue requirement of the transmission function. Charges payable to SLDC are a part of the transmission charges determined by the Commission. Till the time separate accounts are established by BSEB for SLDC these charges shall continue to be determined as a part of the Transmission Charges of BSEB. Cross Subsidy Surcharge 10.4.11 The open access consumers are liable to pay cross subsidy surcharge to compensate the distribution utility for any loss of revenue due to shifting of its consumer to the open access system. The cross subsidy surcharge for open access consumers for the year 2012-13 is calculated as per the following recommended formula in the Tariff Policy. S = T [C (1+L/100) +D] Where, S = Surcharge T = Tariff payable by the relevant category of consumers
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C = Weighted average cost of power purchase of top 5% at the margin excluding liquid fuel based generation and renewable power. D = Wheeling charges (Transmission and Distribution) L = System losses for the applicable voltage level, expressed as a percentage. 10.4.12 The cross subsidy surcharge determined as per the above formula is as follows: For 132 kV consumers = 120.68 Ps./kWh. For 33 kV consumers (other than HTSS) = 107 Ps./kWh. For 11 kV consumers (other than HTSS) = 103.43 Ps./kWh For HTSS consumers 33 kV = 0 Ps./kWh 11 kV = 0 Ps./kWh 10.4.13 As indicated earlier the Commission in view of the prevailing power shortages in the state would like HT consumers to seek power purchase options from sources outside the state. The Commission in order to make the cost of delivered power comparable with the retail tariff approves the following cross subsidy surcharge for FY 2012-13 as determined by the Commission in its tariff order for FY2011-12. For 132 kV consumers = 60 Ps./kWh. For 33 kV consumers (other than HTSS) = 54 Ps./kWh. For 11 kV consumers (other than HTSS) = 52 Ps./kWh For HTSS consumers Additional Surcharge 10.4.14 The Commission is not in favour of levy of any additional surcharge, in the absence of the necessary data. The same shall be leviable only if it is conclusively demonstrated by BSEB that open access will lead to stranding of its fixed cost. BSEB should indicate the quantum of such stranded cost and the period over which it would be stranded for determination of additional surcharge. Reactive Energy charges 10.4.15 The open access consumers should pay a reactive energy charge to BSEB, for drawal / injection of reactive energy. The Commission in its last tariff order had directed BSEB to conduct a study to determine the reactive energy charge and submit a proposal in the next tariff application. However BSEB has not submitted any such proposal and till the time BSEB submits a proposal in this regard, the reactive 33 kV = 0 Ps./kWh 11 kV = 0 Ps./kWh
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drawal shall continue to be charged at 04 paise/kVAR as determined by the Commission in its tariff order for FY2011-12. Information to be put on the web site 10.4.16 The Commission directs BSEB to put all information related to open access facilities/charges on its web site. The information should include open access regulations, procedure for obtaining open access and details of all charges payable by an open access consumer
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11 Renewable Purchase Obligation
11.1
Background
11.1.1 Renewable Energy (RE) from cogeneration and from biomass plants has a potential of more than 800 MW in the state of Bihar which can be tapped as a viable option for decentralized power generation within a short gestation period. Generation using bagasse and biomass such as rice husk, paddy straws, corn cobs/other biomass sources has the potential to enhance availability of power and provide employment in rural areas. Large number of biomass projects exceeding 500 kW has been cleared by State Investment Promotion Board (SIPB) which can be installed with favourable Renewable Energy Policy of the State Govt. There are several success stories of village electrification, including power for agricultural and lighting purposes and this need to be replicated. Bihar is also favorably placed for harnessing solar power on decentralized basis. This immense potential in the state can be utilised for meeting its power requirement, particularly in rural areas. Solar Photo Voltic (SPV) programme is very popular in the state and there is need to lure private investors to take up larger projects in the state. 11.2 Renewable Purchase Obligations (RPO)
11.2.1 The Renewable Purchase Obligations (RPOs) ensure that the obligated entities procure a certain minimum percentage of their total power requirement from renewable energy sources. The followings are some of the key regulatory & policy provisions related to RPO: The Electricity Act 2003 As per Section 86(1) (e) The State Commission shall discharge the following functions namely: Promote co-generation and generation of electricity from renewable sources of energy by providing suitable measures for connectivity with the grid and sale of electricity to any person and also specify, for purchase of electricity from such sources, a percentage of the total consumption of electricity in the area of a distribution licensee;
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National Electricity Policy As per Section 5.12.1 and 5.12.2Non-conventional sources of energy being the most environment friendly there is an urgent need to promote generation of electricity based on such sources of energy. For this purpose, efforts need to be made to reduce the capital cost of projects based on non-conventional and renewable sources of energy. Cost of energy can also be reduced by promoting competition within such projects. At the same time, adequate promotional measures would also have to be taken for development of technologies and a sustained growth of these sources As per Section 5.12.2The Electricity Act 2003 provides that co-generation and generation of electricity from non-conventional sources would be promoted by the SERCs by providing suitable measures for connectivity with grid and sale of electricity to any person and also by specifying, for purchase of electricity from such sources, a percentage of the total consumption of electricity in the area of a distribution licensee. Such percentage for purchase of power from non-conventional sources should be made applicable for the tariffs to be determined by the SERCs at the earliest. Progressively the share of electricity from non-conventional sources would need to be increased as prescribed by State Electricity Regulatory Commissions. Such purchase by distribution companies shall be through competitive bidding process. Considering the fact that it will take some time before nonconventional technologies compete, in terms of cost, with conventional sources, the Commission may determine an appropriate differential in prices to promote these technologies Tariff Policy As per Section 6.4 (1) Pursuant to provisions of section 86(1)(e) of the Act, the Appropriate Commission shall fix a minimum percentage for purchase of energy from such sources taking into account availability of such resources in the region and its impact on retail tariffs. Such percentage for purchase of energy should be made applicable for the tariffs to be determined by the SERCs latest by April 1, 2006 National action plan on Climate Change (NAPCC) Renewable Purchase Obligation target of 5% at national level for 2010 with annual increase in trajectory over long term so as to reach around 15% RPO target by 2020
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11.2.2 The RPO targets have been defined by a number of states in the form of Solar RPO and non-solar RPO targets for obligated entities (Distribution licensee, captive consumer, open access consumer). 11.2.3 After the enactment of Electricity Act 2003, several States have issued the RPO but still a number of barriers were being faced in the effective implementation of RPO. Some of the issues are lack of compliance in a number of states due to low installed capacity; compliance met & obligated entities not willing to procure more electricity from renewable energy sources, high transaction cost to meet RPO compliance for small capacity open access and captive consumers. 11.3 Renewable energy Policy
11.3.1 The Govt. of Bihar (GoB) had issued policy guidelines for increasing private sector participation for developing Non-conventional energy sources in 2003 which was applicable for five years. Keeping in the view that the potential for the renewable is yet to be harnessed the Govt. of Bihar has issued revised policy for the promotion of power generation from renewable energy sources in June 2011 vide Letter No-Pra 02/Breda Apra Niti-11/08/2845 dated 24/6/2011. 11.3.2 The revised policy is applicable for the development of all form of renewable energy resources. The responsibility for the development of biomass biogas based projects, cogeneration projects wind power projects municipal solid waste based projects remains with the Bihar Renewable Energy Development Agency (BREDA), the state nodal agency for the development of renewable energy generation programs & for the development of micro/mini/small hydel plants (up to 25 MW) the responsibility remains with the Bihar State Hydroelectric Power Corporation. 11.3.3 The revised policy 2011 has issued guidelines on the key issues stated as follow: a) b) Project Approval process & role of institutional authorities Regarding the sale of power to the BSEB, wheeling of power for third party sale or captive use; c) d) Project monitoring and activity milestones; Incentives /applicability e.g. applicability of policies notified by the state and central Govt. from time to time, incentives under prevalent industrial incentive
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policy of the GoB and also such similar applicable policies, exemption from electricity duty and entry tax; e) Special concession for the sustainability of the biomass based projects that no two biomass based projects in an area of radial distance of 25 km to ensure the availability of biomass; f) Regarding the Renewable Energy Purchase Obligation, the policy has emphasized that the BSEB or the distribution licensee should purchase more power from renewable resources than the minimum prescribed by the BERC with the approval from the Government at tariff approved by the BERC. 11.4 BERC (Renewable Purchase Obligation, its Compliance and REC Framework Implementation) Regulations, 2010 11.4.1 The Commission has notified BERC (Renewable Purchase Obligation, its Compliance and REC Framework Implementation) Regulations, 2010 on 16th November, 2010; Clause 4(1) of the regulation states that Every obligated entity shall purchase not less than 1.5%, 2.5%, 4%, 4.5% and 5% of its total energy consumption (total energy input minus T&D losses) during 2010-11, 2011-12, 2012-13, 2013-14 and 2014-15 respectively from renewable energy sources under the Renewable Purchase Obligation or until reviewed by the Commission. Provided that 0.25% out of the renewable purchase obligation so specified in the year 2010-11 shall be procured from generation based on solar as renewable energy source and shall be increased at a rate of 0.25% every year thereafter till 2014-15 or until reviewed by the Commission. 11.4.2 To promote solar energy projects for generation and sale of electricity from solar projects to distribution licensee within the State of Bihar, the Commission has notified BERC (Terms and Conditions for tariff determination from Solar Energy Sources) Regulations, 2010 on 2nd August 2010. 11.4.3 Based on the above mentioned regulations it was made obligatory for BSEB to purchase certain percentage of energy of their total energy consumption from Renewable Energy sources, as stated below:
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Table 163: Renewable Purchase obligation for BSEB
From Renewable Sources Renewable Purchase Obligation (RPO) % Share of solar power in RPO Net Solar power purchase obligation as a % of total power purchase from all sources
FY 201011 1.5% 0.25% 0.00375%
FY 201112 2.5% 0.5% 0.0125%
FY 201213 4% 0.75% 0.03%
FY 201314 4.5% 1.0% 0.045%
FY 201415 5.0% 1.25% 0.0625%
11.5
Co-generation and Captive Power Policy
11.5.1 Bihar does not have any specific policy for Co-generation & Captive Power Policy. However, BERC issued order for determination of tariff for purchase of electricity by the BSEB from biomass based power plant and bagasse based cogeneration plant in the State of Bihar in suo motu proceeding No. 2008 vide order dated 21st May 2009. The Commission redetermined the same vide order dated 29.06.2010. In FY 2008 & FY 2009 BSEB has received 2.32 MU & 13.11 MU resp. from the cogeneration plants. BSEB has executed PPA with some sugar mills to purchase the power as detailed in the table below:
Table 164: Co-generation Plants in Bihar
Sl. 1. 2. 3. 4.
Name of the Sugar mill (Cogeneration plant) New Swadeshi Sugar Mill Bharat Sugar Mill JHV Distilleries & Sugar Mills Hashan Sugar mills
Agreement of Power Supply (in MW) Season 5 10 14.54 5 Off Season 8 13 18.05 8
Status as on FY 2009-10 In operation In operation
11.6
Renewable Potential
11.6.1 The state has huge potential for development of renewable energy resources. Following table shows the potential & installed capacity for the different technologies.
Table 165: Technology wise potential & installed capacity in Bihar
Sl. 1. 2. 3.
Technology Small Hydro (irrigation canal & small stream) Bio mass (Gasifier system) Co-generation ( Bagasse based)
Potential (in MW) 195 MW (identified) 200 MW (estimated) 85 MW
Installed capacity as on Mar11 (in MW) 52.8 1.53 (as on Jun07) 47.05
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11.6.2 The State has huge potential for the development of mini or micro hydro projects specially at Gadak canal system, Sone canal system, Tilabeh Dhar, Khardaha Dhar and Parwana Dhar sites. Out of 92 potential sites identified for hydro power development the detailed survey & investigation work has been completed for 42 sites4 till 2007. 11.6.3 In Bihar, it is estimated that the rice husk, the agricultural residue about 22 lakhs of tonne is produced every year which is sufficient to install a capacity of 200 MW in a decentralized manner. More than 4000 medium & small sized rice mills are operating in Bihar most of which runs on grid supply & diesel in the absence of grid power. As on June 2007, biomass gasifier systems worth 1.53 MW of capacity are installed in rice mills & other industries. 11.6.4 It was estimated by the MITCON, Pune in 1999 that the potential worth 85 MW5 is possible to be exploited from the 7 major sugar mills in the Bihar. As on 2009-10, the capacity worth 47.056 MW is installed at some of the sugar mills. 11.6.5 So far in Bihar, no major development has happened for exploitation of the wind energy. 11.7 Power purchase by BSEB under Renewable Purchase Obligations (RPO)
11.7.1 Purchase of power from BSHPC and Co-generation plants by the BSEB have been considered towards the fulfilment of RE purchase obligations and accordingly RE purchase from other sources have been considered. 11.7.2 The total power purchase quantum and its cost from renewable energy source approved by the Commission for FY 2011-12 and FY 2012-13 is given in the table below:
Table 166: Details of Power Purchase from Renewable Source (MU) by BSEB FY 2011-12 FY 2012-13 From Renewable Sources FY 2010-11 (Projected) (Projected) RE Purchase Solar Co-Generation NSSM (New Swadeshi Sugar Mill) B.S.H.P.C. Total power purchase from Renewable Sources 28.35 27.37 55.72 1.0 114.0 30.0 145.0 3.0 275.0 30.0 308.8
4 2
, Source: Road Map for the power sector development in Bihar, July 2007, report of the special task force on Bihar , Govt. of India
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Tariff Order for the FY 2010-11 Page 345
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FY 2011-12 (Projected) 11,931 29.0% 8471.01 FY 2012-13 (Projected) 14,142 27.5% 10252.95
From Renewable Sources
FY 2010-11
Total Power purchase from all sources T&D losses (%) Energy consumption (energy input minus T&D losses)
10,978 32.0% 7465.04
Renewable Purchase Obligation (RPO) achieved/ proposed % Share of solar power in RPO Net Solar power purchase obligation as a % of total power purchase from all sources
0.75% -
1.71% 0.69% 0.012%
3.0% 0.97% 0.029%
11.7.3 The Currents status of power purchase from renewable sources it appears that a lot need to be done by the BSEB in order to comply with the BERC (Renewable Purchase Obligation, its Compliance and REC Framework Implementation) Regulations, 2010. However, BSEB in its current tariff petition for FY 2012-13 has indicated that they are in advance stage of signing PPA with few private developers for generation of power through renewable sources. 11.8 Bihar Renewable Energy Development Agency (BREDA)
11.8.1 As per BERC (RPO) regulations, 2010 6.1 The Commission shall designate an agency as the State Agency for accreditation and recommending the renewable energy projects for registration and to undertake functions under these regulations. 6.2 The State Agency shall function in accordance with the directions issued by the Commission and shall act in consistent with the procedures/rules laid by Central Agency for discharge of its functions under the Central Electricity Regulatory Commission (Terms and Conditions for recognition and issuance of Renewable Energy Certificate for Renewable Energy Generation) Regulations, 2010. 6.3 The State Agency shall submit quarterly status to the Commission in respect of compliance of renewable purchase obligation by the obligated entities in the format as stipulated by the Commission and may suggest appropriate action to the Commission if required for compliance of the renewable purchase obligation. 11.8.2 Bihar Renewable Energy Development Agency (BREDA) has been established to promote development of schemes of non- conventional energy sources. BREDA has been implementing programme of non-conventional energy sources for schemes are
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bio-gas development, SPV systems of Lanterns/Home lighting systems/street lighting systems, and wind mills. Under the Border Area Development Programme, BREDA has implemented a scheme of solar street lighting system in 40 villages along the International Border in the Bihar. 11.8.3 In pursuance of the Rule 6 of BERC (Renewable Purchase Obligation, its Compliance and REC Framework Implementation) Regulations, 2010 the Bihar Electricity Regulatory Commission has designated Bihar Renewable Energy Development Agency (BREDA) as "State Agency" for accreditation and recommending the renewably energy projects for registration and to undertake functions as specified in the Regulation 11.8.4 Thus, BSEB shall endeavor to procure and supply the power from New and Renewable Energy Sources, more than the minimum percentage prescribed under the RPO obligations by the Commission. Due grid strengthening and up gradation in the transmission & distribution system shall be undertaken by BSEB to the extent of power procured by BSEB Licensee from respective New and Renewable Energy Project.
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12 Annexures
12.1
Annexure I: State Advisory Committee
12.1.1 The meeting of the State Advisory Committee has been convened in the court room of the Commission at 11.30 A.M. on 23rd December, 2011. Shri U.N.Panjiar I.A.S. (Retd), Chairperson of the Bihar Electricity Regulatory Commission presided over the meeting. The detail list of members present during the meeting is as below:
Table 167: Members present during the SAC meeting Name of member Organization Designation Shri Umesh Narayan Panjiar Shri Ajay Nayak Shri Shambhunath Mishra Shri S. C. Jha Shri R.N.Sharma Shri L. Prasad Shri T. T. Jha Shri V. C. Gupta Shri Rana Awadesh Shri A.K. Pandey Shri Manish Kumar Shri S.K. Patawari Shri R K Mediratta Shri U.K. Poddar Shri K.P.S. Keshri Shri Sanjay Bhartiya Shri Sanjeev Chaudhary Shri Prabhu Dayal Bhartiya Shri Shaibal Gupta Shri Prabhat Kumar Shri Rajesh Kumar Shri S.K. Singh Shri L.N. Choudhary Shri Rakesh Shri Jayant Kumar Dubey Shri Nand Sharma BERC Energy Dept., GoB Energy Dept.,GoB BERC BERC BSEB BSEB BSEB BSEB BSHPC BREDA BIA IEX BIA BIA BCC BSMA BSMA ADRI East Central Railway East Central Railway BSEB BSEB BSEB BSEB BERC Chairman Principal Secretary Jt. Secretary Member Member Member (Generation) Member (Transmission) Member (Finance) Member (Administration) MD (BHPC) Director Chairman, Energy Sub Committee Sr. V.P Power Sub Committee President Chairman Secretary President Member, Secretary Sr. S.E. Sr. DEE C.E. (Commercial) EEE (Tariff) EEE AEE (Tariff) Consultant, BERC Page 348
Sl. 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26.
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Sl. 27. 28. 29. 30.
Name of member Shri Naresh Desai Shri Vivek Mishra Shri Pramod Kumar Sinha Shri Ankur Satija
Organization Meghraj Meghraj Deloitte, Gurgaon Deloitte, Gurgaon
Designation Consultant, BSEB Consultant, BSEB Consultant, BERC Consultant, BERC
12.1.2 In accordance with Section 181 read with Section 87 of the Electricity Act, 2003, the Commission has constituted a State Advisory Committee (SAC). The Chairman welcomed the members present and stated that as indicated in the Agenda Notes sent with the notice for the meeting, the main agenda of the day is to discuss the tariff petition proposed by the Bihar State Electricity Board for the year FY 2012-13, which had been published newspaper and uploaded on the website of BSEB in accordance with the provisions of the Electricity Act 2003, inviting comments/ suggestions on the tariff petition of the BSEB. 12.1.3 The Chairman stated that generally the State Advisory Committee (SAC) meeting has been held to discuss the tariff petition but he considered it necessary to hold such discussion periodically, to enable the members of the State Advisory Committee to have opportunities to offer views as they may have on the matters. The Chairman assured that the SAC meeting will take place frequently from now onward to discuss the other issues related to supply and distribution of electricity in Bihar. Further, the chairman also said to have next SAC meeting sometime around the month of April 2012. 12.1.4 The Chairman than summarised the salient points of ARR and tariff petition for FY 2012-13. It was stated by the Chairman that the approved ARR for FY 2011-12 is Rs 4706 Cr. against which the Board has now proposed to Rs 6253 Cr. for FY 2011-12 as revised estimate, with is an increase of Rs 1547 Cr. The Board has projected the ARR of Rs 7898 Cr. for FY 2012-13 and BSEB has proposed for recovery of revenue gap of past year on the true up exercise amounting to Rs 5033 Cr. Thus BSEB has projected an ARR which is almost 2.5 times the approved ARR for FY 2011-12. The major portion of the ARR is on account of true up portion of the past years. 12.1.5 The Chairman stated that the average tariff per unit proposed by the Board for the year FY 2012-13 is Rs 6.37 per unit against the current approved tariff of Rs 4.06 per unit. 12.1.6 The Chairman told during the meeting that IEX has sent the communication to the Commission to discuss the recent letter by Ministry of Power dated 30th November
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2011 regarding the provision of mandatory Open Access to consumers requiring power of 1 MW or above and the opinion of Learned Attorney General of India. He stated that the same communication by IEX has already been circulated to member of the SAC. 12.1.7 While discussing the implication of the MoP letter the Chairman stated that as per the opinion of Attorney General, the Commission cant determine the tariff for consumer getting power of 1 MW or above. Such consumer will be mandatorily provided Open Access by the distribution licensee. Such Consumers can purchase power from any source. If these consumers choose to purchase the power from the Board then they will be governed by Section 49 of the Electricity Act 2003 which means that consumers will have to enter into separate agreement with Board for supply of electricity and Commission will not fix their tariff. 12.1.8 The Chairman also mentioned that the State Government vide letter no. 4208 dated 19-09-2011 has issued a clarification that the financial assistance given by the Bihar Government to the Board in the form of resource gap of Rs 1080 Cr. with funds being used for compensating the financial loss caused by the difference between actual T&D loss and T&D loss determined by the Commission. The remaining amount will be used for subsidizing the rural and agriculture consumers. As per the letter the same treatment is also applicable to the resource gap assistance given in the past. 12.1.9 In response to that Principal Secretary, Energy Department, Bihar stated that they have already initiated the discussion on the matter with concerned Government officials and assured that the Government will revert back soon on this issue. 12.1.10 The Chairman also stated that true up exercise of the year from FY 2006-07 to FY 2008-09 has been completed and the order will be available in the month of January 2012. 12.1.11 Thereafter, audio visual presentation was made by Chief Engineer (Commercial) of the BSEB on the salient features of ARR and tariff petition filed by the Board for FY2012-13. The Chairman then called upon the other Members to make their comments / suggestions. Participating in the deliberations of the SAC, the Members raised the following issues. 12.1.12 Terminal benefits: During the meeting the Chairman, BERC has asked for the clarification on the accounting principle followed by the Board for terminal benefit of
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its employees. Member (Finance), BSEB assured to provide the clarification on the same and stated that the Board is following the Account Rules 1985 notified by the Central Government. 12.1.13 Regulatory assets: The Chairman stated that the Board has indicated a huge revenue gap of Rs 6705.57 Cr. during FY 2012-13. The Chairman asked Is it proper to pass on such revenue gap to the consumer? In this context Chairman SAC directed the Board to furnish the information related to the practice followed by different state regulatory Commission on treatment of regulatory assets in the past to the Commission within next fifteen days. 12.1.14 Load factor for Railway Traction Service (RTS): The Board has been also asked for clarification regarding the purpose of fixation of load factor for consumers like Railways for the process of tariff determination. In this regard, the representative from Eastern Central Railway stated that it is very difficult to maintain the constant level of Load factor round the clock as it depends upon the frequency of the trains commuting in the particular route. Further, he suggested the SAC to maintain the same level of Load Factor as issued by the BERC in its previous Tariff Order for FY 2011-12. 12.1.15 Renewable Purchase Obligation: A detailed discussion took place during the meeting on the Renewable Purchase Obligation of the Board. It has been pointed out that the proposed power purchase through renewable source as proposed by the Board in its tariff petition for FY 2012-13 is not as per Renewable Purchase Obligations, its Compliance and REC Framework Implementation Regulations, 2010. The Chairman of the Commission assured that this will be looked into and the RPO shall be complied as per regulation. 12.1.16 Minimum Monthly Charge: During the meeting the matter related to recovery of fixed tariff and the Fixed cost of the Board has been discussed where the Member (Finance) of the Board was of the opinion that the Fixed charge component of the tariff is not adequate to recover the fixed cost of the Board due to which MMC has been proposed in the ARR petition for FY 2012-13. The other members of the SAC have suggested that the MMC should be phased out from the tariff as in the absence of guaranteed minimum supply hours there is no significance of MMC. The practice in the other states on MMC has also been discussed during the meeting.
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12.1.17 Reduction of Cross-subsidy surcharge: The representative from Bihar Industries Association raised the issue of cross subsidy surcharge citing the example of Judgment of Honble APTEL dated Sep 2011 and advised the committee to compute the Voltage wise Cost of supply for determination of cross subsidy surcharge for all consumer category in general and for Industrial consumers in particular. The member of SAC has also talked about the range of cross subsidy surcharge and wheeling charge in the different states. It has also been suggested by the representative of BIA that the cross subsidy surcharge may be waived off for the consumers buying power through open access in case of non-availability of power with the state electricity Board. The member of the SAC has also raised the issue of higher growth in no. of subsidized consumers as compared to subsidizing consumers and its impact on cross-subsidy. 12.1.18 Tariff should be comparative to other state/ Consideration in tariff for NDS-III category: Representative from ADRI suggested that the tariff rate should be fixed taking into consideration of the tariff rates of other states and should be comparable with that. He also suggested that as a part of civic society due consideration should be given to the NDS-III category (tariff meant for temple etc) while determining the tariff of the Board. He has also suggested for providing un-interrupted power supply to Patliputra Industrial areas consumers, where supply are erratic. 12.1.19 The representative of the Bihar Chamber of Commerce has advised that the Construction Power category may also be introduced for LT consumers as well. 12.1.20 Participation of different consumer group in the public hearing process: The Chairman, BERC on the matter of tariff fixation exercise has welcomed the active participation from different consumer groups, and also invited them to participate in the forthcoming public hearing on the tariff petition of BSEB for FY 2012-13. As per the BERC the larger participation of the consumer groups in the public hearing process shall reveal the performance standard maintained by the Board vis-a vis performance standard set by the BERC in Standards of Performance of Distribution Licensee Regulations, 2006. 12.1.21 Proposed tariff hike by the Board: The representative from Bihar Industries Association (BIA) has also pointed out that the tariff hike as proposed by the Board for FY 2012-13 are around 50%, whereas the supply hours are not adequate, and Minimum Charge has been proposed. The representative of BSMA stated that the tariff of Induction Furnace should be comparable with other states. The demand
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charges proposed by the Board are too high. There should not be any MMC Charges. 12.1.22 Non-achievement of T&D loss target by the Board; A detailed discussion took place on the issue of non-achievement of T&D loss targets by the Board, the member of the SAC advised the Board to take immediate steps for reducing the T&D loss of the Board so as to meet the T&D loss target as set by the BERC. The representative of Bihar Industries Association (BIA), Bihar Chamber of Commerce (BCC), Bihar Steel Manufacture association (BSMA) and others stated that the target fixed by the BERC should not be changed. 12.1.23 Electricity Supply code and tariff proposal for FY 2012-13: The member of the SAC also indicated the instances in the tariff petition for FY 2012-13 where the Board has proposed the changes in charges such as Development charge, security deposit, and charges for Tatkal Connection etc. most of which has already been specified in the Electricity Supply Code. The member of SAC suggested that such points should be dealt in while amending the Electricity Supply Code for which separate public hearing may be organized. Regarding development charges and Tatkal Charges it has been pointed out by the representative of the BIA that the Board is obliged to supply power under Section 43 of the Electricity Act 2003 and therefore changing of Development charges or Tatkal Charges is not justified and proper. 12.1.24 Intra-state Open Access: One of the members of the SAC was of the opinion of introducing Intra-state open access in the state of Bihar for consumer with load in the range of 100 kW to 1 MW. 12.1.25 Metering status: The members of the SAC are of the opinion that the Board should achieve 100% metering status and there should not be any instances of un-metered supply. 12.1.26 Resource Gap grant of the State Government: The representative of the BIA stated that the resource Gap grant has been provided to purchase Power from NTPC and the same has been treated as revenue receipt and it should to be continued in future also. Any change will result in higher rate of tariff. 12.1.27 FPPCA: The member of the SAC has also commented on the additional burden on the consumers through FPPCA.
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12.1.28 The Chairman placed on record his profound gratitude to the Members present, for their valuable suggestions and submissions and assured that these would be kept in view, while finalizing the Tariff for the year 2012-13.
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12.2
Sl.
Annexure - II: List of Participant during the Public hearing.

Name and address of Participants
Participants present during the Public hearing at Darbhanga on 15th February 2012 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. Sri Pawan Kr. Sureka - Chamber of Commerce & Industries Sri Prakash Lal Poddar - Divisional Chamber of Commerce & Industries Sri Vijay Kumar Bairoliya - Divisional Chamber of Commerce & Industries Sri Sushil Kumar Jain - Divisional Chamber of Commerce & Industries Sri Sunil Kumar Singh - Divisional Chamber of Commerce & Industries Sri Rintu Kr. Jha - Gramin Vikash Association Sri Shatrughan Jha - Dy. President, JD (U) Prof. Pramod Kr. Sharma - ESCRP Sri Prabodh Singh - Y.I.C.C., Darbhanga Sri Binod Kr. Pansari MICC Sri Ajay Kr. Jalan -Ex. Mahapaur Sri Gyaneshwar Prasad - Industry Chamber Sri Bhola Bhandari Individual Sri Animesh Kr. Jha Individual Sri Kedar Nath Jha Individual Sri Ehtashamur Rahman - Individual Sri Viveka Nand Thakur Individual Sri Arun Kumar Individual Sri Ghulam Ahmad Nazir Individual
B.E.R.C. Representatives 1. 2. 3. 4. Sri Lakshman Bhakta - Dy. Secretary, BERC Sri Amit Kumar Laha BERC Sri Nand Sharma - Consultant, BERC Sri Ankur Satija Deloitte (Consultant, BERC)
B.S.E.B. Representatives 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. Sri Satish Kumar Singh - C.E, (Commercial), BSEB Sri Vijay Kumar - FC II (F&A), BSEB, Patna Sri D. N. Tiwari - G.M cum C.E, Darbhanga Sri K. N. Jha - DGM cum ESE MESA Sri J. K. Dubey - AEE (Tariff) Sri B. K. Mishra - ESE, Darbhanga Sri Amiya Shankar -DDA, MESA, Darbhanga Sri Sudarshan Ram - EEE/Revenue & Commercial, Darbhanga Sri Pradeep Kr. Jha - EEE, Madhubani Sri Ram Babu Bhatti - EEE/Jhanjharpur Page 355
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Sl. 11. 12. 13. 14.
Name and address of Participants Sri R. K. P Chaudhary - EEE/ Darbhanga (Rural) Sri K. K. Singh - EEE/Darbhanga (Urban) Sri D. N. Sinha - Acct. BSEB, Mithila Area Board Sri Naresh Desai Meghraj, (Consultant, BSEB)
rd
Participants present during the Public hearing at Bhagalpur on 23 February 2012 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. Sri Gautam Suman - Chairman, Ang Uthanodolan Samiti Dr. Jayant Jalad - Kendriya Mahaschiv, Ang Uthanodolan Samiti Sri Gautam Banerjee - Co-ordination Committee Sri Prakash Chandra Mishra - Danik Jagran Sri Amar Nath Modi - Human Rights Sri Santosh Kumar - Chairman, Sarvodya Samajik Sanstha, Sahebganj Sri Prakash Chandra Mishra - Swami Vivekanand Samiti, Bhagalpur Sri Jawahar Pd. Mandal -Sampoorna Kranti Aandolankari Manch Sri M.D. Usman - Gen. Sec. RJD Sri Rajesh Singh - Danik Jagran Sri Mukutdhari Agrawal - President, EBK Sri Sudhir Kr. Das - SVS, Bhagalpur Sri Mukesh Kr. Das - Ghositos Girls High School Sri Shashi Shankar Rai - Member, Anusharavan Samiti, Aapurti Anumandal Sri Alok Verma - ETV Bihar/Jharkhand News Sri Abha Kumar - F.M.T News Sri Sandeep Jha - D.B.A, Bhagalpur Sri K. K. Dubey - D.B.A, Bhagalpur Sri Prakash Chandra Gupta Individual Sri S. K. Dwama Individual Sri R. K. Baid Individual Sri Lakhan Lal Prasad - Individual Sri Jata Shankar Tiwari Individual Sri Mahesh Pd. Gupta Individual Md. Hemayat Ansari Individual Nasim Ansari - Individual Sri Gotam Gupta Individual Sri Bhawani Lal Individual Sri Birendra Kumar Individual
B.E.R.C. Representatives 1. Sri Lakshman Bhakta - Dy. Secretary, BERC
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Name and address of Participants Sri Amit Kumar Laha - BERC Sri Nand Sharma - Consultant, BERC Sri Ankur Satija Deloitte (Consultant, BERC)
B.S.E.B. Representatives 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. Sri Satish Kumar Singh - C.E, Commercial, BSEB Sri N. K. Jha - Director (Expenditure), BSEB Sri Rajendra Pandey - ESE, Bhagalpur Sri D. K. Shastri - DDA (Incharge) Sri Suresh Prasad - EEE, Banka Sri R.N. Singh - EEE/BGP/UR Sri K. N. Singh - G.M cum CE, Bhagalpur Sri Gopal Kumar - APO/ESC/Bhagalpur Sri Suresh Prasad Mandal - AEE (APT-1) BSEB, Bhagalpur Sri Bijay Kr. Sinha -Reporter, Sadhna News Sri Ramanand Gupta Individual Sri Naresh Desai Meghraj (Consultant, BSEB)
Participants present during the Public hearing at Purnea on 24th February 2012 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. Sri S.K. Ghosh, G.M. Jute Park, Purnia Sri R. C. Mishra Vice President Chamber of Commerce. Sri Pankaj Nayak - Pankaj International Sri Bimal Singh Bengani - President, North Eastern Chamber of Commerce, Katihar Sri Nirmal Kishore Jha - G. M. , D.I.C, Purnea Sri Nilammber Agrawal - Sri Sri Cold Storage, Purnea Sri R. K. Pathak - ETV Office, Purnea Sri Mahesh Paswan - Bihar Bikash Morcha, Purnea Sri OM Polymers BIADA Sri Manish Kumar Jha BIADA Sri Ashish Singh BIADA Sri Vikram Kr. Singh BIADA Sri Nilesh Kr. Agrawal BIADA Sri Satish Chandra Jha Individual Sri Subhash Kumar Individual Sri Rajesh Patwari - Individual Sri Anil Chamaria Individual Sri Manoj Thakur Individual Sri Rameshwar Prasad Individual
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Sl. 20. 21. 22. 23. 24.
Name and address of Participants Sri Anant Bharti Individual Sri Rakesh Kr. Singh Individual Sri Bharat Bhagat Individual Sri Kanhaiya Choudhary Individual Sri Bupendra Nr. Singh Individual
B.E.R.C. Representatives 1. 2. 3. 4. Sri Lakshman Bhakta - Dy. Secretary, BERC Sri Amit Kumar Laha - BERC Sri Nand Sharma - Consultant, BERC Sri Ankur Satija Deloitte (Consultant, BERC)
B.S.E.B. Representatives 1. 2. 3. 4. Sri Satish Kumar Singh - C.E, Commercial, BSEB Sri N. K. Jha - Director (Expenditure), BSEB Sri Ram Chandra Singh DGM cum ESE, KESA Sri Naresh Desai Meghraj (Consultant, BSEB)
th
Participants present during the Public hearing at Gaya on 27 February 2012 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. Kiran Lama - Daiokyo Budhist, Gaya N. Lobsay -Bodhgaya Temple Sri Manoj Kumar - Daiokyo Temple, BodhGaya Sri Beelesh Yadav - Japanese Temple Sri Arbind Kumar - President, Bihar Ind. Assoc. Sri Kaushlendra Pratap - Central Bihar Chamber of Commerce, Gaya Sri Brijnandan Pathak -Vidyut Upbhokta Sangharsh Samiti, Gurudwara Road, Gaya Sri Ramanuj Pd. Singh -Chairman, Prafudh Wagnik Munch, Gaya Sri Pena Chand - Sheelan Monastery Sri Arun Kumar - ETV Reporter Sri R. S. Nagraj BJP Sri Prem Narain - Executive Member, BIA Sri A.C. Lama - Bhudhist Thai Temple Sri N. Gawang Individual Sri Sanjay Kumar Individual Sri Sinith prakash Individual Sri Deepak Kumar Individual Sri Manish Sinha Individual Sri Manohar Kumar Individual Sri Pankaj Kumar Individual
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Sl. 21. 22. 23. 24. 25.
Name and address of Participants Sri Ajit Kumar Individual Sri Bidu Bhushan Pd. Sri Neeraj Kumar Individual Sri Sanath Mishra Individual Nitam Raj BBCN News
B.E.R.C. Representatives 1. 2. 3. Sri Lakshman Bhakta - Dy. Secretary, BERC Sri Nand Sharma - Consultant, BERC Sri Pramod Kumar Sinha Deloitte (Consultant, BERC)
B.S.E.B. Representatives 1. 2. 3. 4. 5. 6. 7. Sri Satish Kumar Singh - C.E, Commercial, BSEB Sri Om Prakash GM cum C.E. , Gaya Sri Arbind Prasad - E.S.E (Supply), Gaya Sri J. K. Dubey - A.E.E (Tariff) Sri R. N. Chaudhary E.E.E, Gaya Sri A. K. Saha -A.E.E (Rev),MESA, Gaya Sri Naresh Desai Meghraj (Consultant, BSEB)
th
Participants present during the Public hearing at Muzaffarpur on 13 March 2012 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. Sri Munindra Thakur Sri. Dhurv Shankar Chaudhary Dr. Naim Kauber Sri. Vishnu Kant Jha Sri. Ksishna Kumar Sri. Hari Shankar Singh Sri. Irshad Hussain Sri. Akhilesh Singh Sri. Arun Kumar Dhanuka North Bihar Chamber of Commerce Sri. Jai Prakash Sarraf North Bihar Chamber of Commerce Sri. Amid Sri. Nunu Kumar Mishra Sri. S. Mishra Sri. Vineet Agrawal M/s Ashok Polymer Pvt. Ltd. Sri. Bharat Bhushan Laghu Udyug Bharti Sri. Sanjeev Kumar Uttar Bihar Udyami Sangh Sri. Chitranjan Prasad Uttar Bihar Udyami Sangh Sri. Ashok Bharti Bijli Grahak Sangh
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Name and address of Participants
B.E.R.C. Representatives 1. 2. 3. 4. Sri Lakshman Bhakta - Dy. Secretary, BERC Sri Amit Kumar Laha BERC Sri Nand Sharma - Consultant, BERC Sri Ankur Satija Deloitte (Consultant, BERC)
B.S.E.B. Representatives 1. 2. 3. 4. 5. 6. Sri Satish Kumar Singh - C.E, Commercial, BSEB Shri Gyasuddin - GM-cum-CE, Tirhut Electric Supply Area Sri Arvind Kumar EEE (Urban), Muzaffarpur Sri K.K. Sharma ESE Sri S. K. Das EEE, Muzaffarpur (E) Sri Umesh Bhakta - EEE, Muzaffarpur (W)
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Participants present during the Public hearing at Patna on 14 & 19 March 2012 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. Sri H. C. Meena - CEDE/EER, Hajipur Sri Arvind Kr. Mishra - Gurhatta, H. Path, Patna Sri Prabhat Kumar - Sr. SE/TRD/DNR Md. Zubair - Vidyut Sangharsh Morcha, Ara Sri Raj Kishor Sharma - Dy. Sec. Lok Kalyan Aayog Ara Sri Ajit Pd. Mehta - Sr. Dy. Sec., Bihar Jawan Kishan Morcha Sri U. K. Poddar - BIA, Patna Sri Sanjay Goenka - BIA, Patna Sri Sanjay Bhatiya -Dinason, Patna Sri Krishan Kr. Singh -Krishan Bhavan, Digha, Patna Shree Nath Singh -Sangharsh Samiti Sri R. B. Acharya - Sangharsh Samiti Sri B. N. Prasad - Bhojpur Chamber of Commerce Sri Shiv Narayan -Bhojpur Chamber of Commerce Smt. Shakuntla Devi - Jan Sangharsh Morcha Sri Vinay Kr. Sinha - C.P.I .M, Patna city, Patna Sri Bimal Pd. Singh - Patna city, CPIM Sri Virendra Thakur - T.U.C.C., Bihar Sri Umesh Kr. Singh - Mahaschiv, Jan Sangharsh Morcha Sri Abhay Goswami -Chairman, Jan Sangram Sena Sri Dilip Mahto -Treasurer, Jan Sangharsh Morcha Sri Subhash Parwari - Parwari Mills Private Limited Sri Manish Poddar - Gangotri Iron & Steel Company Limited
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Sl. 24. 25. 26. 27. 28. 29. 30. 31. 32. 33. 34. 35. 36. 37. 38. 39. 40. 41. 42.
Name and address of Participants Sri Manoranjan Pd. Singh Individual Sri Chandrika Singh Individual Sri A. P. Saha Member Senior Citizen Forum Sri Vijay Kr. Dibakar Individual Smt. Neelam Devi Individual Miss Lakshmi Kumari - Individual Smt. Kamla Individual Prof. P. K. Sharma Individual Sri Doman Singh Individual Sri Raj Kumar Individual Sri Shaligram Singh - Individual Sri Wakil Thakur Individual Sri Uma Shankar pd. - Individual Sri Mritunjay Mani Individual Sri Ramanand Srivastava Individual Sri Raja Babu Individual Sri G. K. Sinha M/s Balmukun Concast ltd. Sri Sanjeev Kumar Chaudhary GISCO Sri Suraj S - BIA
B.E.R.C. Representatives 1. 2. 3. 4. 5. 6. 7. 8. Sri Ganesh Prasad Secretary, BERC Sri R. P. Kanth DD (A), BERC Sri Lakshman Bhakta - Dy. Secretary, BERC Sri Nand Sharma - Consultant, BERC Sri P. R. Ranjan - Consultant, BERC Sri K. N. Thakur - Consultant, BERC Sri Pramod Kumar Sinha Deloitte (Consultant, BERC) Sri Pankaj Goinka Deloitte (Consultant, BERC)
B.S.E.B. Representatives 1. 2. 3. 4. 5. 6. Sri Satish Kumar Singh - C.E, Commercial, BSEB Sri Vijay Kumar - FC II (F&A), BSEB, Patna Sri L. N. Choudhary ESE (Tariff), BSEB Sri S. K. Srivastava - ESE, PESU Unit Sri Vivek Mishra - Meghraj (Consultant, BSEB) Sri Saurabh Garg - Meghraj (Consultant, BSEB)
Page 361

Bihar Tariff 2012-13

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Bihar Tariff 2012-13

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BIHAR ELECTRICITY REGULATORY COMMISSION

Bihar Electricity Regulatory Commission

Bihar Electricity Regulatory Commission

Approved ARR and Revenue Gap for FY 2010-11......................................................................... 106

Bihar Electricity Regulatory Commission

6.20 6.21 6.22 6.23

Directives issued in Tariff Order of FY 2012-13: Fresh Directives ................................................... 297

Bihar Electricity Regulatory Commission

9.3 9.4 9.5 9.6 10

Bihar Electricity Regulatory Commission

Bihar Electricity Regulatory Commission

Bihar Electricity Regulatory Commission

Bihar Electricity Regulatory Commission

Bihar Electricity Regulatory Commission

Bihar Electricity Regulatory Commission

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Case No. TP - 02 of 2011

U.N. Panjiar S.C. Jha

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

TARIFF ORDER FOR FY 2012-13

(S. C. Jha) Member

(U. N. Panjiar) Chairman

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Issued in Dharbhanga Edition Newspaper

Issued in Bhagalpur, Purnia and Gaya Edition Newspaper

Issued in Muzaffarpur Edition Newspaper

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Name of Consumer/ consumer organizations Darbhanga - 15th February 2012

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Name of Consumer/ consumer organizations Sri Shashi Shankar Rai

Address Laloo Chak, Isakchak, Bhagalpur

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Name of Place Darbhanga Bhagalpur Purnea Gaya

Bihar Electricity Regulatory Commission

TARIFF ORDER FOR FY 2012-13

Name of Place Muzaffarpur Patna