Rerc Order On Uday And Unfunded Gap.pdf

RAJASTHAN ELECTRICITY REGULATORY COMMISSION, JAIPUR Petition No. RERC 1077/17, 1078/17, 1076/17

In the matter of approval of Aggregate Revenue Requirement and Tariff Petition of Jaipur Vidyut Vitran Nigam Ltd (JVVNL), Ajmer Vidyut Vitran Nigam Ltd (AVVNL) and Jodhpur Vidyut Vitran Nigam Ltd (JdVVNL) for FY 2016-17 and FY 2017-18.

Coram:

Petitioners:

Shri Vishvanath Hiremath, Chairman Shri R.P.Barwar, Member Shri S.C. Dinkar, Member Jaipur Vidyut Vitran Nigam Ltd. Jaipur (1077/17) Ajmer Vidyut Vitran Nigam Ltd. Ajmer (1078/17) Jodhpur Vidyut Vitran Nigam Ltd. Jodhpur (1076/17)

Date of hearing: 23.08.2017 Date of Order:

02.11.2017 ORDER

Section-1: Background

1.1

The three distribution companies namely, Jaipur Vidyut Vitran Nigam Ltd. (JVVNL), Ajmer Vidyut Vitran Nigam Ltd. (AVVNL) and Jodhpur Vidyut Vitran Nigam Ltd. (JdVVNL), collectively called Discoms or Petitioners had filed petitions for approval of Aggregate Revenue Requirement (ARR) for FY 2016-17 and FY 2017-18 under section 62 & 64 of Electricity Act, 2003 read with RERC (Terms and Conditions for Determination of Tariff) Regulations, 2014.

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1.2

JVVNL & AVVNL filed the petitions on 31.01.2017 and JdVVNL on 30.1.2017 for both FY 2016-17 and FY 2017-18.

1.3

Technical validation meetings of Discoms officers and Commission on the aforesaid petitions were held on 28.02.2017 and 07.03.2017.

1.4

After examining the petitions, the Commission vide letter dated 08.03.2017 pointed out the deficiencies observed in the petitions for both FY 2016-17 & FY 2017-18 and the Discoms were directed to clarify along with supporting documents.

1.5

JVVNL, AVVNL & JdVVNL, on dated 27.04.2017, 09.05.2017 & 09.05.2017 respectively, submitted reply to the deficiencies indicated by the Commission vide its letter dated 08.03.2017 and JVVNL also filed revised information on dated 05.05.2017.

1.6

As per Section 64(2) of the EA, 2003 which requires that applicant should publish application filed in such abridged form and manner as may be specified by the Appropriate Commission, the Commission on dated 23.05.2017 allowed Discoms to publish the notice in the newspapers.

1.7

Accordingly, public notices with salient features of the petitions, inviting comments/suggestions, were published in the following newspapers on the dates shown against each of the petitions and were also placed on the websites of the Commission and Discoms. The last date for submission of comments/ suggestions was notified as 03.07.2017 for JVVNL, AVVNL & JdVVNL:

Sr. No. (i) (ii) (iii) (iv) (V) (vi)

1.8

Name of Newspapers Rajasthan Patrika Dainik Bhaskar Times of India Rashtradoot Navjyoti Indian Express

JVVNL 01.06.2017 01.06.2017 02.06.2017 01.06.2017 01.06.2017 -

AVVNL 03.06.2017 02.06.2017 03.06.2017 -

JdVVNL 31.05.2017 31.05.2017 01.06.2017

In all, 15 numbers of comments/suggestions were received on JVVNL petitions and 9 numbers on AVVNL and JDVVNL petition from the stakeholders for both FY 2016-17 & FY 2017-18. The list of stakeholders is enclosed at Annexure-A.

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1.9

The Commission forwarded the suggestions/comments submitted Stakeholders to the respective Discoms for furnishing the reply.

by

the

1.10

The public hearing in the matter was held on 23.08.2017. The list of stakeholders who have made oral submissions during the hearing is enclosed at Annexure-B.

1.11

The Commission has carefully considered the petitions filed by Discoms, objection and suggestion filed by stakeholders thereon, reply given by the Discoms in respect of queries of the Commission & stakeholders and oral submissions made by the Discoms & Stakeholders during the hearing and also perused all the relevant records while finalizing this order.

1.12

As issues arising in all the petitions are common for all three Discoms and the Stakeholders have also made common submissions on all the petitions and a common hearing was held in the matter, the Commission therefore has decided to consider all the petitions together for both FY 2016-17 & FY 2017-18 and dispose them through this common order.

1.13

In this Order Commission has considered ARR for FY 2016-17 and FY 2017-18 of all the Discoms including the various proposals made keeping in view the RERC(Terms and Conditions of Tariff )Regulations, 2014 and norms prescribed therein, the earlier orders of the Commission, orders of the Hon’ble Supreme Court and Appellate Tribunal for Electricity.

1.14

The projections approved in this order for Generation and Transmission are for the purpose of estimating the aggregate revenue requirements of the petitioners. It shall not be construed as formal approval of the Commission for any investment or tariff for transmission or generating plant etc.

1.15

For ready reference, a list of abbreviations used in this order is placed at Annexure – C of this order.

1.16

All energy figures used in this order, unless stated otherwise, are in Million Units (MU).

1.17

For the purpose of representation, figures given in the tables are shown as rounded off. However, for calculation purpose, actual figures have been considered.

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1.18

This order has been structured in six sections as given under.

a) Section 1 – Background discussed in this part. b) Section2 - Comments/suggestions of Stakeholders, Petitioners’ response and the Commission’s observations/views thereon. In this section the Commission has considered comments/suggestions made by stakeholders on the General and specific issues related to proposals of ARR determination and tariff of three Discoms. c) Section 3 - ARR for FY 2016-17 of the three Discoms. d) Section 4 - ARR for FY 2017-18 of the three Discoms. In section 3 and 4 the Commission has looked into performance of Discoms, Distribution losses, effect of UDAY, various steps taken by Discoms for efficiency improvement and individually dealt various cost parameters viz power purchase cost, O&M, interest cost , depreciation etc. and decided the ARR of FY 2016-17 and FY 2017-18 and also calculated the estimated sales and revenue for various categories of consumers in accordance with RERC(Terms and Conditions for Determination of Tariff) Regulations, 2014. e) Section 5 – Tariff Proposals and approved Tariff Discoms have not made any proposal for revision in tariff which has been accepted. However, Discoms have made certain rationalization measures in order to facilitate better utilization of resources, economic pricing and better revenue management which have been dealt in the order. f) Section 6- Way Forward In this section the Commission has considered compliance of its previous order and other action taken by the Discoms under UDAY scheme and has made certain observation and advise for improvement.

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Section – 2 Stakeholders comments, Petitioners’ response and the Commission’s views: Part I – General issues/comments related to Aggregate Revenue Requirement (ARR) of FY 2016-17 & FY 2017-18 2.1. Hindi Version of Petition 2.1.1. Stakeholders’ Suggestions/Comments: It was submitted that the petitions for ARR for FY 2016-17 and FY 2017-18 should be made available in Hindi. 2.1.2. Petitioners’ Response: The Discoms submitted that the Hindi version of the ARR petitions has been published on the website and was also available for sale. 2.1.3. Commission’s View: The Commission has noted the submission of Discoms. 2.2. Filing of petition 2.2.1. Stakeholders’ Suggestions/Comments: 1.

It was submitted that as per Regulation 6 of RERC Tariff Regulations, 2014, every licensee has to file the petition latest by 30th November of each year. Therefore, Discoms should submit the reasons for late filing of the petitions.

2.

It was submitted that Discoms must ensure that copy of petitions are made available at all local offices, so that the petitions reaches to the maximum people.

3.

It was submitted that the Discoms should revise the petitions according to the RVPN tariff order dated 26.05.2017, RWPL tariff order dated 19.06.2017, RVUN tariff order dated 20.06.2017.

4.

It was submitted that ARR & Tariff projections related to FY 2016-17 is irrelevant as the year is already over and its actual data & achievements are available.

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2.2.2. Petitioners’ Response: 1. The Discoms submitted that the Tariff Order for FY 2015-16 was issued by the Commission on 22th September 2016. After the issuance of Tariff Order, the Discoms undertook review of the Order and considered the impact of various decisions and directives given by the Commission. This entire process requires time. 2. The Discoms submitted that the copy of petitions along with annexures were made available to concerned offices. Further, the summary of the petitions were published in English and Hindi newspapers. 3. The Discoms submitted that while preparing the ARR and Tariff Petition, the figures available at that point of time with respect to transmission and other charges have been considered. It was further submitted that it would not be feasible to change and revise the same now. 4. The Discoms submitted that although the FY 2016-17 is over, the ARR still needs to be determined to assess the overall performance while truing up. 2.2.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. 2.3. Non Compliance of CEA Safety Regulations 2.3.1. Stakeholders’ Suggestions/Comments: It was submitted that there were non-compliances of directives issued in previous tariff order and Discoms have also not complied with under mentioned Regulations: a. The Central Electricity Authority (Measures Relating to Safety and Electric Supply) Regulation 2010 b. The Central (Safety Requirements for Construction, Operation and Maintenance of Electric Plants and Electric Lines) Regulation 2011.

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2.3.2. Petitioners’ Response: The Discoms submitted that the list of directives issued by the Commission in its previous Tariff Order along with its status of compliance has been clarified in the petitions. Further, they are trying their best to ensure that all the safety related norms and compliances are followed. The field officers and technicians are being imparted with safety related trainings and sessions. It is made sure that all the safety procedures are followed and the safety equipment being used is of superior quality to avoid any mishaps. It was submitted that there is a provision for medical check-up of every employee in services Regulations. 2.3.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. It has been noted that Discoms have submitted compliance of the Commission directions along with the petition. Commission reiterates that as per the provisions of Electricity Act, 2003, the petitioners have to strictly implement these Regulations. The Regulations also contemplate overseeing of implementation of these regulations by the Chief Electrical Inspectors/Electrical Inspectors appointed by the State Government and any non-implementation is to be dealt with by these Inspectors. The Chief Electrical Inspector and Electrical Inspectors are the watchdogs of the Safety Regulations and they shall ensure their implementation by periodical checking of any violation of the regulations. The Govt. of Rajasthan should periodically review the working of Electrical Inspectors and take action if need be for non-performance of their duties. Proper implementation of safety regulations will avoid electrical accidents which are occurring in large numbers and would save precious life and limbs of the individual and the livestock. If there is any negligence on the part of the persons in charge of electrical installations. As noted in investment plan order dated 06.09.2017, it is reiterated that if Petitioners need to spend any money for compliance of the Safety Regulations, the same can be claimed through Investment Plan/ARR and the Commission is willing to consider any additional amount spent on training of employees and for compliance of Safety Regulations.

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2.4. Recovery of Arrear 2.4.1. Stakeholders’ Suggestions/Comments: It was submitted that even though notices are being issued, but disconnections are not being made by Discoms officials thereby burdening the consumers with the burden of interest on loans as a result of non-recovery of dues. It was further submitted that the work of recovery from debtors should be outsourced. 2.4.2. Petitioners’ Response: Discoms submitted that for effective implementation of disconnections of defaulting consumers, CAO monitors the progress and strict action are being taken against the defaulting officers for failing in effective implementation of Disconnection Notices. For recovery of dues amnesty schemes are launched to encourage the consumers to deposit their dues. 2.4.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 6 of this order. 2.5. Control Over Theft of Electricity 2.5.1. Stakeholders’ Suggestions/Comments: 1. It was submitted that the Discoms should take proper measures to control the theft of electricity. 2. It was submitted that proper vigilance should be carried out at Hostels run by private institutions as these have been covered under non domestic category. It was further submitted that the Discoms should serve notice to change category from Domestic to Non-Domestic to such private Hostels and provide special direction to the Vigilance branch or the meter readers to report the noncompliances to A.R.O. for the necessary actions. 2.5.2. Petitioners’ Response: 1. Discoms submitted that over the recent times it has been stringent and relentless in its vigilance activities. The special vigilance campaign have been launched Page 8 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

recently considering the theft of electricity. Proper metering have been done on temples situated in public parks, Police stations etc. and instructions have been given and implemented at most of the places. Due to the constant endeavors of the Discoms in the field to curb and control the activities of theft and other misdoings, there is an increase in the number of thefts being caught and reported. 2. The Discoms submitted that under the circular issued in this regard the consumers were to voluntarily get their category changed according to the changed definition of Hostels adopted as per the Urban Development and Housing Department. Further, regular vigilance is carried out and assessment is being made under section 126 of Electricity Act, 2003. 2.5.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 6 of this order. 2.6. Conversion of Flat Rate Consumers To Metered 2.6.1. Stakeholders’ Suggestions/Comments: It was submitted that JVVNL has failed to convert the flat rate consumer to metered category. Discom may be directed to obtain the voluntary declaration of the connected load from the consumers at the first instance and if on verification the load so declared is found higher than the sanctioned load, their supply should be disconnected. These should be reconnected only through the meters. 2.6.2. Petitioners’ Response: The Discom submitted that it has been persistent in its efforts to convert the flat rate consumers to metered category over the past years. This is very much evident from the decreasing number of flat rate consumers of the Discoms over the past years. Also if the flat rate consumer is disconnected due to non-payment of bills, they are reconnected in metered category only.

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2.6.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discom thereto. Discoms should make all efforts to convert the balance flat rate consumers to metered category. 2.7. Tariff and Revenue Deficit 2.7.1. Stakeholders’ Suggestions/Comments: 1. It was submitted that Discoms need to state the reasons for not proposing any revision in tariff in spite of revenue deficit and also the manner in which the deficit will be absorbed. 2. It was submitted that Discoms need to clarify measures to be taken under UDAY scheme. 2.7.2. Petitioners’ Response: 1. The Discoms submitted that they are taking various steps to improve the performance and reduce the revenue deficit. The Commission issued the Tariff Order for FY 2015-16 on 22.09.2016 with tariff hike, therefore, there is no proposal for tariff hike by the Discoms for FY 2016-17 and FY 2017-18 due to recent tariff hike. Further, the Discoms have set loss reduction target and improvement in operational efficiency for generating additional revenue instead of going for anther increase in tariff in a short span of time. With regard to revenue deficit, Discoms submitted that in order to achieve envisaged operational efficiency and bring around improvements, various measures are being taken. These steps include restricting power supply in areas with high AT&C losses, performance monitoring and management system, 100% feeder and DT metering, AMR metering for high value consumers, energy audit & accounting at feeder level, feeder segregation, Mukhyamantri Vidhyut Sudhar Abhiyan, etc. Loss reduction targets have been formulated at the division/circle/zonal level and concerned officials have been made responsible for achieving the loss reduction targets. At the same time, efforts are also being made to reduce theft and other illegal activities by undertaking name and shame campaign and aggressive vigilance drives. Further, the capital investment plans Page 10 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

are also being taken up to achieve the distribution loss trajectory set forth in the UDAY scheme. 2. The Discoms are committed towards achieving the targets and measures as mentioned in the UDAY agreement. The efforts are targeted towards goal of achieving financial turnaround as per the scheme. 2.7.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. 2.8. Sales and Revenue 2.8.1. Stakeholders’ Suggestions/Comments: 1. It was submitted that as per Regulation 75(1), Discoms need to provide forecast of expected sale of electricity for different categories of consumers to each consumption slab within in its area of supply. In this regard Discoms may clarify the other factors which have affected the energy sales projection. It was also submitted that sale from FY 2014-15 to FY 2015-16 for industrial category have been decreasing, Discoms need to clarify the same. 2. It was submitted that in case of JVVNL projected sales in respect of electric traction is NIL for FY 2017-18, JVVNL need to clarify the same. Further, whether transmission and SLDC charges applicable to Railway Traction have been assessed and if so then the amount in respect of each station be furnished. 3. It was submitted that in case of JVVNL, in form 2.1, the sale to Agriculture metered category is shown as 52377.95 MUs in FY 2015-16 whereas the total sales for the year as shown in petition is 17852.21 MUs, JVVNL may clarify the same. 4. Discoms are required to provide the information of sales and revenue for temporary connections in past years and projection for FY 2016-17 and FY 2017-18. 5. It was submitted that the Discoms while assessing the revenue from sale, have not considered other charges like demand surcharge, power factor surcharge, CT/PT charges , miscellaneous charges etc. Page 11 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

2.8.2. Petitioners’ Response: 1. Discoms submitted that there are various factors which are considered while projecting the sales for ensuing years. The past years sales trend is analyzed and CAGR is applied to arrive at the sales projections. As FY 2016-17 was half over while projecting the sales, the actual sales data for the first few months of FY 201617 was also looked upon while projecting sales. Also, in the domestic category additional release of connection under the “power for all” schemes were also considered. The past year sales figures as shown are as per actual. The dip in sales has been observed in some categories and the same have been addressed in the true up petitions of the concerned years. Regarding the sales in Industrial category, an upward trend has been observed during the course of time as is mentioned in the Petition also. The lower sales in FY 2015-16 can be attributed to the consumers opting for open access and other factors. Further, the Discoms submitted that it had filed the ARR and Tariff Petition as per the RERC Tariff Regulations, 2014. All the information required for the determination of ARR has been submitted in the petition, formats and the reply to the data gaps observed by the Commission. The format 2.1 along with the slab wise data duly filed has been resubmitted along with the reply to data gaps. 2. JVVNL submitted that railways has opted for complete open access and would not be a consumer of the Discom from 1st April 2017. Hence there would be sales to the railways in FY 2016-17 but not from FY 2017-18 onwards. The transmission and SLDC charges applicable to Railway Traction forms part of the income of RVPN and not of Discoms. 3. JVVNL submitted that the sales as mentioned in form 2.1 is in Lakh Units, whereas the sales as shown in petition is Million Units. 4. The Discoms submitted that the sales and revenue as shown in the true up petition for FY 2014-15 and FY 2015-16 is inclusive of the sales to temporary connections, the bifurcation of the same in not possible.

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5. The Discoms submitted that while projecting revenue for the ensuing years only the revenue from fixed and energy charges are projected based on the expected sales and the existing tariff. Apart from this the Non-Tariff Income, revenue from additional surcharge, cross subsidy surcharge and wheeling charges is also computed and submitted. The miscellaneous charges and income from theft and malpractice are a part of the Non-Tariff Income only which have been duly projected for the upcoming years. Other charges cannot be projected as such and the same can be dealt with at the time True up. 2.8.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. The Discoms should provide the information related to temporary connection in next year filing. Commission has dealt with the issue of sale and revenue in ARR section of this order. 2.9. Distribution Losses 2.9.1. Stakeholders’ Suggestions/Comments: 1. It was submitted that Discoms should provide the town wise status of AT&C losses as specified under R-APDRP scheme. 2. It was submitted that the Discoms have not adhered to the distribution loss reduction trajectory prescribed by the Commission in its order dated 20.02.2015 for the FY 2016-17 and FY 2017-18. Thus, it was requested to work out the energy requirement of the Discoms by adhering to the trajectory fixed by the Commission and also taking the RVPN transmission losses as 3.89% as approved by the Commission for FY 2017-18 vide order dated 26.05.2017 instead of 4.11% submitted by Discoms. Discoms need to clarify the reason for not achieving the losses on lower side in spite of huge capital investment in name of strengthening the distribution system and meeting the growth requirements by the Discoms. 3. It was submitted that JVVNL may provide the steps taken for reduction in losses through the strategy of feeder wise energy audit and the outcome from the same.

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2.9.2. Petitioners’ Response: 1. The Discoms submitted that the information regarding RAPDRP scheme has been provided in the Investment Plan petition and reply to various objections raised on the same. The requisite information for the determination of ARR for FY 2016-17 and FY 2017-18 has been provided in the petition, formats and the reply to the data gaps. 2. Discoms submitted that considering the large distribution area, sparse distribution of load centers and significant number of agricultural connections, certain time would be required to bring down the loss levels. Disallowing expenses based on the loss trajectory set by the Commission will act as a setback in the Discoms efforts towards achieving operational and financial turnaround by FY 2018-19 thereby leading to negative impact on the consumers at large. Further, it was submitted that in order to achieve envisaged operational efficiency and bring around improvements, various measures have been taken. These steps include restricting power supply in areas with high AT&C losses, performance monitoring and management system, 100% feeder and DT metering, AMR metering for high value consumers, energy audit & accounting at feeder level, feeder segregation, Mukhyamantri Vidhyut Sudhar Yojana, etc. Loss reduction targets have been prepared at the division/circle/zonal level and concerned officials have been made responsible for achieving the loss reduction targets. Further, it was submitted that efforts were made to reduce theft and other illegal activities by undertaking name and shame campaign and aggressive vigilance drives. Further, the capital investment plans were also going on to achieve the distribution loss trajectory set forth by the Commission. The Discoms submitted that they are committed towards reduction of losses and therefore time bound targets have been set for each of the improvement measures. These initiatives have also been recognized at the highest levels and form part of the landmark tripartite MoU signed under the UDAY scheme between the Discoms, the Central Ministry and the Rajasthan Government. 3. JVVNL submitted that various initiatives have been taken up vigorously in order to reduce the losses and bring it down to the levels as agreed upon in the UDAY scheme. Further, regarding the energy audit JVVNL submitted that they are Page 14 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

carrying out system driven energy audit. Energy audit for all 11kV system started from September’16 and the results have been uploaded on the their website. 2.9.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. Further, restricting supply to area of high losses may be useful in short term. However, Discoms should focus on identifying the thefts and reasons for losses so that honest consumers of these area do not suffer on this account. The name & shame campaign should also be used for recovery of arrears. Commission has dealt with the issue of Distribution losses in ARR section of this order. 2.10. Distribution Franchisee 2.10.1. Stakeholders’ Suggestions/Comments: Detail information was sought in respect of distribution franchisee appointed by JVVNL at Kota and Bharatpur, similarly for AVVNL & JDVVNL, if any appointed by them. Further, Stakeholders also sought other operational details relating to functioning of franchisee and sharing of the revenue & expenditure. 2.10.2. Petitioners’ Response: JVVNL submitted that CESC has been appointed as distribution franchisee for Kota and Bharatpur. AVVNL has appointed Tata Power for Ajmer City circle and JdVVNL has appointed CESC for Bikaner city circle. They are input based franchisee where the per unit power purchase rate is decided at the franchisee input and the franchisee is to collect the tariff as prescribed by RERC as they are not separate licensees and works under Discoms. ARR is prepared for the Discom as a whole and no separate filing is to be done for the franchisee towns. 2.10.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto.

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2.11.Rajasthan Urja Vikas Nigam Limited (RUVNL) 2.11.1. Stakeholders’ Suggestions/Comments: Information was sought in respect of formation and function of Rajasthan Urja Vikas Nigam Limited (RUVNL). 2.11.2. Petitioners’ Response: The Discoms submitted that Rajasthan Urja Vikas Nigam Limited (RUVNL) was formed by Government of Rajasthan on 04.12.2015 in order to carry out the power procurement management for the distribution companies. Earlier the power procurement was being carried out by the Rajasthan Discoms Power Procurement Centre (RDPPC) constituted by the State Power Distribution Companies of Rajasthan. 2.11.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. Part II – Issues/comments related to Aggregate Revenue Requirement (ARR) of FY 201617 & FY 2017-18 2.12.Power Purchase 2.12.1. Stakeholders’ Suggestions/Comments: 1. It was submitted that the Discom should clarify the source, amount and rate at which the power purchase have been projected during FY 2016-17 and FY 201718. 2. It was submitted that the JVVNL should provide the details of excess power purchase proposed during FY 2016-17 and FY 2017-18. 3. It was submitted that JdVVNL in FY 2016-17 has purchased 154.20 MUs through Indian Energy Exchange despite of surplus power in that financial year.

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4. It was submitted that the projected power purchase cost for FY 2016-17 & 2017-18 were much higher than that approved in order dated 22.09.2016 which should not be allowed without prudence check. 5. It was submitted that the Discoms should furnish the reasons for selling the surplus power at an average rate below Rs. 4.00 per unit as approved by the Commission in earlier year and even lower than the rate at which it was sold in FY 2014-15. 6. It was submitted that in form 3.1, for FY 2016-17 and FY 2017-18, the petitioner has shown the power from “Case-1 PPA”. In this regard Discoms should furnish the name of generating station, its capacity, tariff at which supply would be available and reference of Commission order vide which tariff for this station has been approved. 7. Discoms have shown the availability of power from CTPP unit No.5, which has not yet achieved the COD. 8. Discoms have shown the availability from Satpura whereas the same is dismantled and sold to Sikkim Ferrow Alloys Ltd. Discoms are required to furnish the reasons for such consideration. 9. JVVNL has shown the average cost of energy purchase from Suratgargh station of Rs. 16.29 per unit. Discom may state the reason for consideration of such high cost. 10. It was submitted that the Discoms should provide the basis for cost of power purchased from NTPC & NHPC, furnish the copy of the order of CERC, if, any approved by it and PPA executed by Discoms. 2.12.2. Petitioners’ Response: 1. The details pertaining to power purchase for FY 2016-17 and FY 2017-18 have been shown in the Form 3.1 of the respective years. 2. JVVNL submitted that they have projected to sell the surplus power at Rs. 2.50 per unit and expect to realise Rs. 515.84 crore and Rs. 970.27 crore during FY 2016-17 and FY 2017-18.

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3. JdVVNL submitted that the surplus scenario is arrived at by analyzing the demand and the tied up availability for a particular year. In the state of Rajasthan there is quite high capacity tied up from renewable sources. The reliability of such sources varies depending upon the weather conditions. There are instances when sometimes the peak demand is so high that the power from tied up sources is not sufficient to meet the demand. In such cases the Discom has to resort to short term exchange purchase also. Also there are vice versa cases where due to low demand the Discom sells its power through exchange. 4. The Discoms submitted that the energy availability for FY 2016-17 and FY 2017-18 is projected from existing and new stations. For existing stations, the power purchase quantum has been considered as per the actual energy received in previous years. The Discoms analyzed the existing power scenario and the power purchase has been accordingly projected considering the energy requirement and the merit order principles. The power purchase from stations which were commissioned in FY 2015-16 and were only available for part of the year has been computed based on capacity, PLF and Auxiliary consumption. 5. The Discoms submitted that the rates discovered in the power market are of dynamic nature and it sells surplus power in the power market at the rates prevailing in the market at that specific time. The power market works as per demand-supply scenario. These rates are found to be at a lower side and was even less than the approved rate of Rs 4.00/unit for sale of surplus power through exchange. 6. Discoms submitted that the Case 1 PPA is for procurement of 500 MW power done

under Case 1 bidding through M/s PTC India Ltd. (Developer M/s Maruti Clean Coal & Power Ltd. Located at Bandhakhar village in Chattisgarh) for 250 MW at the levelized tariff of Rs. 4.51 and M/s PTC India Ltd. (Developer M/s DB Power Ltd. Located at Baradarha village in Chattisgarh) for 250 MW at the levelized tariff of Rs. 4.81. The Commission had approved the tariff for the same vide its order dated 22.07.2015. 7. The projections for Chhabra unit no. 5 were made on the basis of its expected CoD. 8. In case of the power being procured from Chambal/Satpura as shown in Format 3.1, it is submitted that the power is being procured from the Hydro sources of Chambal. The nomenclature is as per the previous bills received. Page 18 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

9. Discoms submitted that they are expected to be in a power surplus scenario in the upcoming years. Considering the power market scenario and prevailing conditions it would not be economically viable to sell off the surplus power at the rates discovered in the exchange. Thus in order to minimize the financial impact of the same and optimize the power purchase cost, less quantum is proposed to be scheduled from STPS, which would subsequently reduce the variable charges but the fixed charges component is still at the existing level thereby increasing the total per unit cost as reflecting in Format 3.1. 10. Discoms submitted that for projecting power purchase cost certain assumptions have been considered and for Coal, Gas and Hydro based Power Plants, an escalation rate in the range of 2% to 15% is considered over the per unit actual cost of FY 2015-16 for computing the per unit fixed cost for different power plants for FY 2016-17 and FY 2017-18 depending on the power procurement envisaged, plant load factor, availability, etc. Other charges (including cess, electricity duty, etc.) for FY 2016-17 and FY 2017-18 have not been considered while determining the power purchase cost. 2.12.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue of power purchase in ARR section of this order. 2.13.Transmission & SLDC Charges 2.13.1. Stakeholders’ Suggestions/Comments: It was submitted that the transmission and SLDC charges should be considered as approved by the Commission vide its Order dated 27.10.2016 and 26.05.2017 for FY 2016-17 and FY 2017-18 respectively. The Discoms may revise their submission accordingly. 2.13.2. Petitioners’ Response: The Discoms submitted that while preparing the ARR and Tariff Petition they have considered the figures available at that point of time with respect to transmission and other charges. Further, it would not be feasible to change and revise the same now. Page 19 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

2.13.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in ARR section of this order. 2.14.O&M Expenses 2.14.1. Stakeholders’ Suggestions/Comments: Discoms must clarify the reason of claiming O&M expenses higher than approved by the Commission in order dated 22.09.2016. 2.14.2. Petitioners’ Response: The Discoms submitted that O&M expenses for FY 2016-17 and FY 2017-18 are based on normative calculations as per RERC (Terms and Conditions for Determination of Tariff) Regulations, 2014. The order dated 22.09.2016 was for FY 2015-16 against which the true up petitions have been filed with the Commission justifying the variations in approved and actual O&M expenses. 2.14.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in ARR section of this order. 2.15.Terminal Benefit 2.15.1. Stakeholders’ Suggestions/Comments: It was submitted that as FY 2016-17 has already come to end, terminal benefits should be allowed only to the extent of actual payment made to designated fund during FY 2016-17. 2.15.2. Petitioners’ Response: Discoms submitted that terminal benefits expenses as mentioned in the ARR for FY 2016-17 and FY 2017-18 is based on Actuarial valuation report. Regarding the Terminal benefits expenses for FY 2014-15 and FY 2015-16, the details pertaining to Page 20 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

regular and additional contributions have been mentioned in the True up petition filed with the Commission. Similarly the actual contribution made to the trust with respect to the Terminal Benefits in FY 2016-17 can be dealt with at the time of True Up. 2.15.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with the issue in ARR section of this order. 2.16.Depreciation 2.16.1. Stakeholders’ Suggestions/Comments It was submitted that while computing depreciation, the Discoms have not provided proper details of the assets which have completed their 12 years of useful life. Thus the Commission may deduct 20% under this head. 2.16.2. Petitioners’ Response: The Discom submitted that depreciation for FY 2016-17 and FY 2017-18 has been calculated as per Straight Line Method (SLM) at rates specified in Annexure-1 of the RERC Tariff Regulations, 2014 in accordance with Regulation 22 of the said Regulations. The depreciation has been determined by applying applicable depreciation rates on the average balance of opening and closing Gross Fixed Assets. The detailed computation of Depreciation is shown in format 3.6 submitted along with the petition. 2.16.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue of depreciation in ARR section of this order. 2.17.Interest and Finance charges 2.17.1. Stakeholders’ Suggestions/Comments 1. It was submitted that the amount equivalent to consumption of electricity of one year should be deposited by the consumers in advance and Discoms may Page 21 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

provide interest on the same at a rate above the bank rate thereby benefiting both consumers and the Discoms. 2. It was submitted that the Discom need to clarify the amount and rate of interest at which interest on loan has been computed. 3. It was submitted that interest on loan taken to meet the revenue deficit due to non receipt of subsidy under section 65 of Electricity Act, 2003 in advance shall not be allowed. 4. It was observed that the Discoms have claimed interest liability on unfunded gap as per annual account @12.40%. It is further submitted that Discoms need to provide the details of unfunded liability in the form of borrowings, outstanding payments to power suppliers, contractors and terminal benefits etc. It was submitted that unfunded gap needs to be reworked out by Discoms with higher liability taken over by the State Government. 5. It was submitted that the Discoms have estimated an increase of 5% per annum in finance charges and other borrowing costs over the audited accounts of FY 201516 without giving the proper details. Further, it was observed from annual accounts of FY 2015-16 that the other borrowing costs consists mainly of bank charges and guarantee charges which are linked to debt and with debt reduced considerably with UDAY, financing charges should also have been reduced. Thus, the Discoms need to clarify the annual enhancement of 5%. 6. It was submitted that with the taking over of 75% of combined debt of all the Discoms by State Government under UDAY in FY 2015-16 and FY 2016-17, financial restructuring of Discoms was done and with such financial restructuring, the debt have been progressively reduced so considering opening and closing balance of debt (based on past years) for interest computation would not be appropriate. Thus, debt should have been considered as net fixed assets less equity and if such debt works out to be equal or less than the breakup of residual debt after taking over of 75%, then rate of interest applicable on residual debt, should be the average rate of 9.54% instead of 12.40%.

Page 22 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

2.17.2. Petitioners’ Response: 1. Discoms have submitted that the Commission has already considered the aspect of advance deposit in RERC (Electricity Supply Code and Connected Matters) (Eleventh Amendment) Regulations, 2017. 2. It was submitted that the information of Loan and interest thereon have been furnished in format 3.7 of the petition. 3. It was submitted that the Discoms have been receiving full Tariff Subsidy from the State Government. In fact the Government had released surplus subsidy during the previous years and there is no gap regarding the same. 4. The Discoms submitted that owing to the widening gap between the approved unfunded gap and the actual losses, the petitioner had been reeling under severe financial stress. To bridge this ever increasing gap, the Government of India and Government of Rajasthan have taken over 75% of the outstanding loans of the Petitioner as on 30.09.2015 under the tripartite MoU signed with the Government of India and Government of Rajasthan in order to improve the operational and financial efficiency and enable the Petitioner to achieve financial turnaround. It is a part of the Government’s endeavour to help the Discoms to come out of its financial distress. Accordingly, the details of actual accumulated losses of the Discoms along with the amount of losses taken over and the interest computed thereof have been detailed out in the Petition. While calculating the interest on unfunded revenue gap for previous years, the Discoms have reduced the unfunded gap to the extent of excess of actual loan take over after first reducing the unrecognized losses. 5. The Discoms submitted that it is difficult to forecast item wise financing and other cost for FY 2016-17 and FY 2017-18, therefore, the Discoms have forecasted financing cost taking into account the past trends, expected future financing requirements and the methodology followed during previous years. The other finance charges and cost are again subject to true up and the actual cost can be taken up at that time in case of any variations. 6. The Discoms submitted that under the UDAY scheme 75% of debt was to be taken over by GoR. The GoR has taken over the 75% debt, the detailed information have Page 23 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

been submitted along with the reply to the data gaps. Further, it was submitted that the takeover have been on the actual losses of the Discoms and not as per the revenue gap approved by the Commission. Further, with regard to rate of interest, Discoms submitted that, as per Regulation 21 (5) of Regulation 2014: “The rate of interest shall be the weighted average rate of interest calculated on the basis of the actual loan portfolio at the beginning of each year applicable to the regulated business of the Generating Company or Licensee as the case may be: Provided that the weighted average interest rate allowed by the Commission for normative loans shall continue to be applicable to the outstanding normative loans: Provided further that if there is no actual loan for a particular year but normative loan is still outstanding, the last available weighted average rate of interest shall be considered: Provided further that if the regulated business of the Generating Company or Licensee, as the case may be, does not have actual loan, then the weighted average rate of interest of the Generating Company or Licensee as a whole shall be considered.” 2.17.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in ARR section of this order. 2.18.Delayed Payment Surcharge 2.18.1. Stakeholders’ Suggestions/Comments It was submitted that there is no question of Delayed Payment Surcharge (DPS) to be receivable from consumers arises as the same has not been considered as non tariff income in the ARR projection. This matter should examined later at the time of True Up.

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2.18.2. Petitioners’ Response: The Discoms submitted that Delayed Payment Surcharge (DPS) is levied on the outstanding receivables of the consumers and considered in the books of accounts on accrual basis. Considering the DPS as a part of Non Tariff Income (NTI) does not reflect the actual amount of DPS being realized by the Petitioner. If the accrued DPS is considered to form part of NTI, it is important that the financing cost for corresponding receivables must also be considered. The Petitioner is allowed only 1.5 months receivable in allowance of working capital and for period beyond that period DPS is applicable. Thus the financing cost of such receivables must be allowed. Also the security deposit is deducted from the two months receivable while calculating the working capital interest. 2.18.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 3&4 of this order. 2.19.Voltage Rebate 2.19.1. Stakeholders’ Suggestions/Comments 1. It was requested to continue the existing voltage rebate on both energy and fixed charges instead of only on the energy charges as proposed by the Discoms. 2. It was submitted that in order to avail the incentives of voltage rebate, consumers have to make heavy capital expenditure on transformation capacity, its bay and up-gradation of voltage level supply line, which will result in saving in cost incurred on infrastructure to be provided be Discoms, which is further recovered through fixed charges, therefore the rebate should also be given on fixed charges. It is further submitted that withdrawal of incentive/rebate by Discoms, once heavy capital investment has been made should not be allowed. 2.19.2. Petitioners’ Response: The Discoms submitted that voltage rebate is provided to HT consumers based on the voltage at which they are connected in order to incentivize HT consumers to avail connections on a higher voltage level. Although the energy charges are the same for all HT consumers of a category, consumers who have taken a Page 25 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

connection at a higher voltage level are given a rebate in accordance with their voltage level because the T&D losses at higher voltage level are less and hence the benefits of the same can be shared with the consumers. However, the benefits of higher voltages are only in terms of savings in energy alone and there is no impact on fixed charges. Moreover, the maintenance cost for HT lines are higher compared to lower voltage lines. The fixed charges in the tariff do not ensure recovery of fixed cost elements. Thus, the Discoms consider offering voltage rebate on energy charges only. 2.19.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 5 of this order. 2.20.Contact Demand 2.20.1. Stakeholders’ Suggestions/Comments It was submitted that the ceiling limit of the contract demand for H.T. consumers should be increased from 105% to 110% for the day time (06:00-22:00 hrs.). 2.20.2. Petitioners’ Response: Discoms submitted that the proposal to increase the existing ceiling limit 105% of the contract demand to 120% during night hours (22:00- 06:00 hours) for deemed energy drawl from Discoms have been made in order to encourage the user to consume power during night hours which would help to ease out the load curve. 2.20.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 5 of this order. 2.21.Load Factor Rebate 2.21.1. Stakeholders’ Suggestions/Comments It was submitted that for Large Industrial Consumers with Contract Demand up to 1 MW, a rebate of about of Rs. 0.25/kWh in energy consumption over the load Page 26 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

factor more than 25% and with Contract Demand more than 1MW, a rebate of about Rs. 0.75/kWh in the energy consumption over the load factor more than 35% should be allowed, which will result in the increase of energy consumption of H.T. Consumers and per unit average realization. 2.21.2. Petitioners’ Response: Regarding Load Factor Incentive, Discoms submitted that the same has been proposed so as to minimize the huge and random variations in the consumption pattern, as it tends to disrupt the entire system of the Discoms. The Discoms proposed a rebate of Rs 0.15 per unit on energy charges for consumers maintaining Load Factor of 50% and above during the billing period. The rebate would only be applicable on the energy consumption over a load factor above 50%. Whereas, the incentives as suggested by the stakeholder are on a higher side and would not be feasible for the Discoms. 2.21.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 5 of this order. 2.22.Power Factor Improvement Incentive 2.22.1. Stakeholders’ Suggestions/Comments It was submitted to continue the incentive on power factor improvement of present rate of 1% on full tariff instead of Discoms’ proposal of 0.5% of energy charges for each 0.01(1%) improvement above 0.95 (95%) till 0.97(97%). Further, the proposal of Discoms is to reduce incentive rate for power factor in the range of 0.95 to 0.97 by half of that at present but no financial basis of capital cost of capacitor installation vis-à-vis incentive has been given. It was submitted that the existing incentive of keeping average power factor above .95 (95%) may be continued for a 132 KV EHT consumer, who is owing, operating & maintaining his sub-station at his cost.

Page 27 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

2.22.2. Petitioners’ Response: Discoms submitted that Power Factor of system is governed by nature of load. Generally low power factor is caused by the highly inductive load on the system. Due to low power factor actual working component of the power gets reduced leading the system to overloading, Higher Line Losses, Voltage Dips. Economical operation of the system becomes difficult in low power factor scenario as appropriate infrastructure needs to be added to compensate its ill effects. So, it becomes very important that a reasonable value of power factor to be maintained for reliable & economical operation of the system. Hence considering the various ill effects of low power factor it is proposed to modify the structure to ensure that the rebates are commensurate with the benefits accrued to the network. As the benefits do not increase equally for every percentage point improvement in power factor, it is proposed to introduce graded power factor as proposed. Discoms submitted that as per the provisions of tariff, the power factor is worked out as the ratio of total watt hours to corresponding volt ampere hours. Accordingly, the power factor is worked out and penalty or incentive is provided as per the provisions of Tariff. 2.22.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 5 of this order. 2.23.Temporary Supply tariff 2.23.1. Stakeholders’ Suggestions/Comments 1. It was submitted that either the proposal of change of temporary tariff for the corresponding permanent supply plus 50% to 10% be made applicable for construction purpose also or permanent connection may be allowed for construction of building where the duration is more than one year. 2. It was submitted that changes in temporary supply tariff should be applicable to all and not only for the events of commercial nature. Further, clause 8.5.6 of revised tariff policy notified on 28th January, 2016 provides that “In case of outages Page 28 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

of generator supplying to a consumer on open access, standby arrangements should be provided by the licensee on the payment of tariff for temporary connection to that consumer category as specified by the Appropriate Commission. Provided that such charges shall not be more than 125 percent of the normal tariff of that category.” Therefore, while considering changes in temporary supply tariff provisions of tariff policy, 125% of tariff for corresponding category (instead of 150%) should be considered. 2.23.2. Petitioners’ Response: Discoms submitted that at present, in case of temporary tariff, the applicable tariff for corresponding permanent supply plus 50% is being charged. The Petitioner has proposed to revise the same to the corresponding permanent supply tariff plus 10% for a period of two months. The proposed change would be applicable for a group of consumers, trusts and societies holding events and will not be applicable for individual consumers and for construction purposes. The proposed change would only be applicable for fairs, exhibitions and decorative purposes. Post the period of two months the existing clause (permanent tariff plus 50%) will be applicable. 2.23.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 5 of this order. 2.24. Jaipur Metro Rail Corporation 2.24.1. Stakeholders’ Suggestions/Comments 1. Jaipur Metro Rail Corporation (JMRC) submitted to allow the Integrated Maximum Demand of sub-stations meant for metro rail operations. 2. JMRC requested Commission to reconsider its decision to completely bill JMRC on Railway traction tariff (HT large industrial Tariff), as it is not in line with Commission’s own observation and APTEL decision on preferential treatment to metro rail services over railway services.

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2.24.2. Petitioners’ Response: 1. JVVNL submitted that providing this facility means that the Discom has to keep additional spare capacity which would be solely blocked for Jaipur Metro which leads to extra transformer and equipment cost. Additionally, the backup system also has to be maintained to cater to such needs. The same view was also taken up by the Commission in its tariff order dated 22.09.2016 stating that integrated maximum demand facility cannot be allowed to Jaipur Metro as traction and non-traction load has not been segregated. 2. JVVNL submitted that a meeting was held on 13th April 2015 in compliance of directives of the RERC given with Retail Tariff order dated 20th February 2015 regarding examination of issue of separate metering and billing of traction/nontraction load of Jaipur Metro. In the meeting it was intimated by the Jaipur metro members that it is not feasible to segregate traction and non-traction load by Jaipur Metro for separate metering and billing purposes. After detailed deliberation and discussions, the Committee was of the opinion that a single combined tariff may be considered for metro services. Accordingly, the JVVNL had given the proposal in the Petition that HT Industry Tariff may be applicable to the Metro without the 10% rebate. In case of Jaipur Metro, as discussed in the meeting of JMRC officials and JVVNL officials, such segregation cannot be done. Also, as communicated by JMRC, over 70% of their load is Non-Traction load, therefore such rebate should not be applicable. The same was also agreed upon by the Commission in its order dated 22.09.2016. 2.24.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. Commission has already taken a view in the matter vide order dated 22.09.2016. 2.25.Farm House 2.25.1. Stakeholders’ Suggestions/Comments It was submitted in respect of the Farm House category, which have been incorporated in Domestic Service, Discoms need to clarify that whether the consumer can use the electricity for the purpose of lighting, heating and pumping Page 30 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

of water for swimming pool/agricultural purpose/ fruit garden/road light inside the Farm House and also for marriage purposes. 2.25.2. Petitioners’ Response: The Discoms submitted that the tariff is charged as per the respective category under which the connection has been issued. 2.25.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. 2.26.Agriculture category 2.26.1. Stakeholders’ Suggestions/Comments It was submitted that the Discoms may intimate the position in respect of news appeared in Rajasthan Patrika dated 20.06.2017 regarding no disconnection of agricultural consumer for a period of six months for non-payment by consumers and no DPS to be levied for such delay. 2.26.2. Petitioners’ Response: The Discoms submitted that as far as news of non-disconnection of agriculture connection for six months is concerned, it is submitted that no such order has been issued. 2.26.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto. 2.27.Prompt Payment 2.27.1. Stakeholders’ Suggestions/Comments It was submitted the rebate proposed by Discoms would not attract most of the consumers as they make the bill payment prior to 10 days of due date. Further, it Page 31 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

was also suggested that instead of bi-monthly billing, bills should be raised on monthly basis, which shall improved the cash flow of Discoms. 2.27.2. Petitioners’ Response: As per bank rate of 12.40% the 10 days rate would be 0.35%, accordingly the Discoms have proposed the aforesaid rebate. 2.27.3. Commission’s View: The Commission has taken note of the comments of the Stakeholders and reply of Discoms thereto and has dealt with this issue in section 5 of this order.

Page 32 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Section-3: Annual Revenue Requirement 3. Annual Revenue Requirement for FY 2016-17: 3.1 Determination of ARR requires assessment of energy sales as well as cost of various elements like power purchase cost, O&M expenses, interest cost and depreciation, etc. Projection of the Petitioners with respect to various components of ARR, the Commission’s analysis thereon after consideration of views expressed by the Stakeholders and decision with respect to items given below are discussed in the following paras: (1)

Energy sales

(2)

Losses, both transmission and distribution

(3)

Power purchase cost, including transmission charges and SLDC charges

(4)

Operation and maintenance expenses

(5)

Interest and finance charges and interest on working capital

(6)

Depreciation

(7)

Revenue from existing tariff

(8)

Non-tariff and other income

(9)

Revenue deficit based on existing tariff

Energy Sales 3.2

3.3

Discoms have worked out the energy sales for FY 2016-17 on the basis of the audited figures of FY 2015-16 as well as actual data for the past years. The consumer category wise sales projected by the three Discoms and the energy sales being approved now by the Commission have been discussed in the following sub-paras. The Discoms have projected the energy sales for FY 2016-17 for the following consumer categories: (1) All consumer categories, except agriculture (2) Agriculture consumers (Metered) (3) Agriculture consumers (Flat Rate) Page 33 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Petitioners’ Submission Energy Sales for Metered Categories (except Agriculture) 3.4 T h e Discoms have submitted that they have worked out energy sales for FY 2016-17 on the basis of historical sales data and audited figures of sales for FY 2015-16 using the category wise CAGR as per methodology approved by Commission in the previous year’s tariff order. The energy sales from FY 2008-09 to FY 2015-16 have been used for all categories except for agriculture category. 3.5 For Domestic category, besides the CAGR growth rate, Discoms stated that the increase in sales is largely attributable to increase in consumers in rural areas consequent to intensified efforts under RGGVY scheme, increase in specific consumption of the existing consumers due to improvement in living standards, policy decision release of all pending connections in domestic category and to improve the availability of energy in the rural areas. 3.6 Apart from above, Discoms have also kept in view the joint initiative of the Government of India and Government of Rajasthan to provide 24 X 7 power in the State to all consumers (except agriculture consumers) which ensures uninterrupted supply of quality power to existing consumers by the end of 12th Plan and providing access to electricity to all unconnected consumers in the next five years. Under this initiative, Discoms have envisaged to add approximately six lakh consumers in the State of Rajasthan. 3.7 For Non Domestic category, Discoms stated that there has been rapid growth in sales in last few years which is attributable to increasing urbanisation and increase in commercial activities in the recent past. 3.8 For Industrial consumers, the Discoms stated that there has been a growth in sales in small, medium and large industrial categories in the past, however, due to industrial consumers opting for open access, low growth of industrial sales was witnessed during the previous years. 3.9 With regard to mixed load category, Discoms stated that a decreasing trend has been observed in the previous years which can be attributed to the shift in certain consumer groups.

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Energy sales to Agriculture Metered (M) Consumers 3.10 The energy sales for agriculture metered category have been estimated on the basis of the following factors: a) Existing consumers at the start of the Financial Year b) Addition in the consumers during the Financial Year. c) Consumers converted from ‘Agriculture Flat’ to ‘Agriculture Metered’ category. d) Connected load per consumer. e) Estimated specific energy consumption. 3.11 T h e connected load per consumer has been forecasted based on the trend observed in previous years and the growth anticipated in connected load per consumer due to the decrease in the water table. 3.12 T h e Discoms submitted that, they have considered the specific consumption of 2030 kWh/kW/year for JVVNL, 1621 kWh/kW/year for AVVNL and 1868 kWh/kW/year for JdVVNL. 3.13 The Discoms have furnished the following information regarding number of metered consumers, connected load and specific consumption in their petition: Table 1: Agriculture (M) sales for FY 2016-17-JVVNL Particulars Consumers Connected Total Specific Consumption (Nos.) Load per Connected consumption (Sales) MU consumer Load (kW) (kWh/kW/year) (kW) Existing consumers 4,26,930 5.82 24,86,516 2030 5,047 Add: New Consumers 15,000 5.82 87,363 2030 177 Add: converted from flat rate 25,000 7.60 1,90,109 2030 386 Total 4,66,930 5,610

Page 35 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 2: Agriculture (M) sales for FY 2016-17- AVVNL Connected Total Consumers Load per Connect Particulars (Nos.) consumer ed Load (kW) (kW) Existing consumers Add: New Consumers Add: converted from flat rate Total

Consumption (Sales) MU

370909

6.47

24,00,333

1621

3,891

7,500

6.47

48,536

1621

79

10,000

11.52

1,15,194

1621

187

3,88,409

4,156

Table 3: Agriculture (M) sales for FY 2016-17- JdVVNL Connected Total Consumers Load per Particulars Connecte (Nos.) consumer d Load (kW) (kW) Existing consumers Add: New Consumers Add: converted from flat Totalrate

Specific consumption (kWh/kW/yea r)

Specific consumption (kWh/kW/year )

Consumption (Sales) MU

2,63,528

17.28

45,54,665

1,868

8,510

10,000

17.28

1,72,834

1,868

161

20,000

17.74

3,54,841

1,868

331

2,93,528

9,003

Energy Sales for Agriculture Flat Rate (FR) Consumers 3.14 For forecasting the connected load per consumer for 2016-17, the connected load of previous years has been considered for JVVNL, AVVNL and JdVVNL. 3.15 For projecting the sales for agriculture (flat) category for FY 2016-17, Discoms have considered the specific consumption of 1945 kWh/kW/year as approved earlier by the Commission. 3.16 Discoms indicated the following details sale to the agriculture Flat Rate category :

Page 36 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 4: Agriculture (FR) Sales for FY 2016-17 – JVVNL Connected Total Consumers Load per Connected Particulars consumer (Nos.) Load (kW) (kW) Existing consumers Less: converted to meter Total

7.60

2,79,034

1,945

543

25,000

7.60

1,90,109

1,945

370

11,694

173

Specific consumption (kWh/kW/yea r)

Consumpti on (Sales) MU

47691

11.52

5,49,374

1,945

1,069

10,000

11.52

1,15,194

1,945

224

37,691

844

Table 6: Agriculture (FR) Sales for FY 2016-17– JdVVNL Connected Total Consumers Load per Connected (Nos.) consumer Particulars Load (kW) (kW) Existing consumers Less: converted to meter Total

Consumption (Sales) MU

36,694

Table 5: Agriculture (FR) Sales for FY 2016-17– AVVNL Connecte Total Consumer d Load per Connected Particular s (Nos.) consumer Load (kW) s (kW) Existing consumers Less: converted to meter Total

Specific consumption (kWh/kW/year)

Specific consumption (kWh/kW/yea r)

Consumptio n (Sales) MU

37,034

17.74

6,57,059

1,945

1,278

20,000

17.74

3,54,841

1,945

345

17,034

933

Page 37 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Total energy sales projected by Discoms: 3.17 The projection of energy sales of different consumer categories discussed in preceding sub-paras is given in the following table: Table 7: Total Energy Sales for FY 2016-17- Discoms’ Projection (MU)

Particulars Domestic Non-Domestic Public Street Light Agriculture (Metered) Agriculture (Flat) Small Industry Medium Industry Large Industry Public Water Works (S) Public Water Works (M) Public Water Works (L) Mixed Load / Bulk Supply Electric Traction Total

JVVNL 5358 2222 194 5610 173 322 761 3523 239 43 285 181 392 19304

AVVNL 3701 1100 84 4156 844 285 796 2319 276 44 188 109

JdVVNL 3545 1084 141 9003 933 243 629 1183 265 108 483 383

13902

18000

Total 12604 4406 419 18769 1950 850 2186 7025 781 195 956 673 392 51205

Commission’s Analysis Energy Sales for Metered Categories (except Agriculture Flat Rate Category ) 3.18 Many of the stakeholder in their written and verbal submission during hearing held on 23.08.2017 stated that since the FY 2016-17 is already ended, therefore it would be proper to take actual sales instead of CAGR approach based on past year data. The Discoms submitted actual sales and purchase data for 12 months from April 2016 till March 2017. The Commission has considered the same. The Commission will consider the actual figures based on audited accounts while carrying out the true up for FY 2016-17. 3.19 Accordingly, the category wise metered sales submitted and considered (except for flat rate agriculture) for FY 2016-17 are as follows:

Page 38 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 8: Actual Metered Sales for 12 Months (MUs) (Except Agriculture flat Rate)

Particulars Domestic Non-Domestic Public Street Light Agriculture (Metered) Small Industry Medium Industry Large Industry Public Water Works (S) Public Water Works (M) Public Water Works (L) Mixed Load / Bulk Supply Electric Traction

JVVNL 4803 2130 188 5664 315 727 3929 241 41 304 209 226

AVVNL 3389 1088 75 4161 278 781 2390 283 70 201 101

JdVVNL 3270 1068 101 8843 232 607 1129 264 100 459 371

Total 11462 4285 364 18668 825 2115 7448 788 212 965 681 226

18776

12816

16446

48038

Total

Energy Sales for Agriculture Flat Rate (FR) Consumers Connected Load per Consumer & Specific Consumption for Flat Rate Consumers.

3.20 The Commission has observed that the Discoms have considered the connected load per consumer of 7.60 KW for JVVNL, 11.52 KW for AVVNL and 17.74 KW for JdVVNL. The Commission has accepted connected load and number of consumers as filed by Discoms. 3.21 Further, the Commission has found that Discoms have filed the specific consumption for flat rate consumers as approved by Commission in the earl ier order which is accepted by the Commission for FY 2016-17. 3.22 It is observed that while computing the sale for flat rate category, JVVNL and AVVNL have considered the sale to converted consumer for the full year, instead of that consumers converted on the average could be taken to be in the metered category for 6 months and flat rate for 6 months. Whereas JdVVNL has considered the converted consumers for six months. 3.23 Accordingly, the connected load, specific consumption and estimated sales for FY 2016-17 have been approved by the Commission.

Page 39 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 9: Agriculture (FR) Sales for FY 2016-17 – JVVNL Particulars Consume Connecte Total Specific rs (Nos.) d Load Connecte consumption per d Load (kWh/kW/ye consumer (kW) ar) (kW) Existing consumers 36,694 7.60 2,79,034 1,945 Less: converted to meter 25,000 7.60 1,90,109 1,945 Total 11,694

Consumpti on (Sales) MU 543 185 358

Table 10: Agriculture (FR) Sales for FY 2016-17 – AVVNL Particulars Consumers Connected Total Specific Consumption (Nos.) Load per Connected consumption (Sales) MU consumer Load (kW) (kWh/kW/year) (kW) Existing consumers 47691 11.52 5,49,374 1,945 1,069 Less: converted to meter 10,000 11.52 1,15,194 1,945 112 Total 37,691 957 Table 11: Agriculture (FR) Sales for FY 2016-17 – JDVVNL Particulars Consumers Connected Total Specific Consumption (Nos.) Load per Connected consumption (Sales) MU consumer Load (kW) (kWh/kW/year) (kW) Existing consumers Less: converted to meter Total

37,034

17.74

6,57,059

1,945

1,278

20,000 17,034

17.74

3,54,841

1,945

345 933

Energy Sales as approved by the Commission for all categories 3.24 Based on the actual data approach as discussed in the preceding paragraphs and agriculture flat rate sales, as worked out on the basis of connected load and accepted specific consumption, the energy sales for Discoms are being approved as under: Page 40 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 12: Energy Sales approved by the Commission for FY 2016-17(MU)

Particulars Domestic Non-Domestic Public Street Light Agriculture (Metered) Agriculture (Flat) Small Industry Medium Industry Large Industry Public Water Works (S) Public Water Works (M) Public Water Works (L) Mixed Load / Bulk Supply Electric Traction Total

JVVNL AVVNL JdVVNL Rajasthan 4803 3389 3270 11462 2130 1088 1068 4285 188 75 101 364 5664 4161 8843 18668 358 957 933 2247 315 278 232 825 727 781 607 2115 3929 2390 1129 7448 241 283 264 788 41 70 100 212 304 201 459 965 209 101 371 681 226 226 19134 13773 17379 50286

Transmission and Distribution losses Distribution Losses Petitioners’ Submission 3.25 The Discoms have submitted that they are focusing on loss reduction programs initiated in previous years and also increasingly use technology to target erring consumers and reduce the losses during the projection period. The investments being made under schemes like RAPDRP, FIP, SIP etc. are also expected to aid in the reduction of distribution loss especially in urban pockets. 3.26 Further, to achieve operational efficiency and bring around improvements, other steps like loss based load management, performance monitoring and management system, 100% feeder and DT metering, AMR metering for high value consumers, energy audit & accounting at feeder level, feeder segregation, etc. have already been initiated. 3.27 Considering the focus and all round efforts being made to reduce the AT&C losses, the commitments made under the UDAY scheme and the present available details, the distribution losses as proposed by the Discoms are provided in the table below and this includes technical as well as commercial losses other than those relating to collection efficiency: Page 41 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 13: Distribution Losses for FY 2016-17 – Petitioners’ Submission

Particulars JVVNL AVVNL JdVVNL

FY 2016-17 25.00% 22.00% 19.00%

Commission’s Analysis 3.28 For FY 2016-17, Discoms have projected distribution losses at higher side as compared to loss trajectory specified by the Commission for which no reasons have been provided. 3.29 It is observed that the Government of India, with an objective to bring in financial discipline and improvement of Discom’s efficiency, has formulated a financial restructuring plan namely “UDAY Scheme” subject to fulfilment of conditions. This scheme while restructuring the finances of the Discoms, has imposed several stringent conditions for improvement in efficiency. The “UDAY Scheme” has been accepted by the State of Rajasthan as well as the Discoms by signing of Memorandum of Understanding. 3.30 Under the UDAY scheme out of the total debt of Rs. 80530 Crore at the end of September , 2015, the GoI shall facilitates the GoR to take over Rs. 40265 crore (50% of the outstanding debt) of the DISCOMs as on 30th September, 2015 in the year 2015-16 and Rs. 20133 crore (25% of the outstanding debt) in the year 2016-17; Important commitments of Discoms as stated under the Scheme are as under. DISCOMs to take the following measures:

a) For the 50% of the debt remaining with it as on 31st March,2016, DISCOMs shall fully/ partially issue State Government guaranteed bonds or get them converted by Banks/Fls into loans or bonds with interest not more than the Banks base rate plus 0.1%. DISCOMs shall ensure timely payment of lenders’ dues towards principal/interest for the balance debt remaining with them. b) The DISCOMs shall pay interest to the GoR on the outstanding GoR loan in a financial year at the rate at which GoR issued non-SLR Bonds (if asked for by GoR).

Page 42 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

c) DISCOMs shall endeavour to reduce AT&C losses as per the following trajectory: Discom

FY 2015-16

FY 2016-17

2017-18

2018-19

JdVVNL

22.4%

18%

16.5%

15%

JVVNL AVVNL

28% 24%

22% 20%

18.5% 17.5%

15% 15%

However, if the target in a particular year is not met, then the DISCOMs shall strive to achieve the targets in the subsequent years so as to achieve the desired target of 15 % AT&C losses by FY 2018-19. DISCOMs shall restrict power supply in areas with high or increasing AT&C losses from 1st April 2016, eliminate the gap between ACS and ARR by FY 2018-19, achieve operational milestones as specified in DDUGJY & IPDS, The DISCOMs shall take the following measures for loss reduction, Undertaking 'name and shame' campaign to control power theft from time to time, Preparing loss reduction targets at division/ circle/ zonal levels and making concerned officers responsible for achieving the loss reduction targets, Implementing performance monitoring and management system (MIS) for tracking the meter replacement, loss reduction and day to day progress for reporting to top management, Achieving 100% Distribution Transformer (DT) metering by June 2018, as per DISCOMs policy, Achieving 100% feeder metering by 30th June2016, Undertaking energy audit up to 11KV level in rural areas by September 2016, Undertaking Feeder Improvement Program for network strengthening and optimization, to be completed by March 2017, Undertaking Physical Feeder Segregation by March 2018 based on availability of funds sanctioned for the purpose under relevant schemes, Installation of AMR for all consumers with consumption above 500 units/month by June 2018 and for other consumers with consumption above 200 units/ month by June 2020, subject to cost benefit analysis, Providing electricity access to 30 lakh unconnected households as per trajectory finalized in the '24x7 Power for All' document by FY 19, Implementing ERP systems for better and effective inventory management personnel management, accounts management, etc. to reduce costs and increase efficiencies by March 2018. The DISCOMs shall undertake various measures for Demand Side Management and Energy Efficiency such as, Providing LED for domestic consumers under DELP Programme through EESL, Undertaking consumer Page 43 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

awareness programmes for optimum utilization of resources and to foster long-term behavioural changes; and Replacing at least 10% of existing agriculture pumps with energy efficient pumps by March 2019. The DISCOMs shall undertake the following tariff measures, Quarterly tariff revision particularly to offset fuel price increase, Timely filing of Tariff Petition before the RERC so that Tariff Order may be issued for the year as early as possible; and Timely preparation of annual accounts of the DISCOMs, which shall also enable timely filing of the Tariff Petition. The MoU also covers the action plan for efficiency improvement. 3.31 The increase in losses should really be a concern for Discoms as it is directly affecting their working and finances. Unless serious efforts are made to bring in the losses to the targeted level, the companies cannot turn around the corner more so the financial crisis which they are facing at present. 3.32 As mentioned above, Government’s have taken over the Debt of Rs. 60857 crore under UDAY, which has impact on ARR of Discoms in the form of reduction in interest cost, the detailed analysis of interest cost has been discussed in forgoing paras under interest cost head. The Discoms in their petition submitted the revised loss target of 25%, 22% & 19% as per in task force meeting for FY 2016-17 for JVVNL, AVVNL and JdVVNL respectively. However, MoU has not been revised accordingly. Further, in UDAY scheme the Government has provided huge financial support as discussed in this order and Discoms and in turn consumers have been benefitted by lower interest burden. 3.33 Looking to the steps being taken by Discoms under UDAY and takeover of interest liability by Government under UDAY and financial restructuring of Discoms the benefit of which has been considered later in this order, the Commission deem it appropriate to align the loss target with the targets given in UDAY MoU. Therefore, in line with AT&C loss targets under UDAY, the Commission has also revised its losses trajectory approved vide its order dated 20.02.2015. 3.34 Thus, the Revised loss target for the remaining control period will be as follows:

Page 44 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 14: Distribution Losses Name of Discoms JVVNL AVVNL JdVVNL

FY 2016-17 22% 20% 18%

2017-18 18.50% 17.50% 16.50%

2018-19 15% 15% 15%

Collection Efficiency 3.35 As Discoms have projected 100% collection efficiency for FY 2016-17. The Commission accepts the submission of Discoms as adoption of lower collection efficiency will increase the revenue gap of Discoms which will indirectly burden the consumers of the State. Transmission Losses 3.36 The Discoms have filed the intra state and inter-state transmission loss of 4.11% and 3.15% respectively. 3.37 Whereas, the Commission has considered the intra state and inter-state transmission loss of 3.89% and 3.15% based on the RVPN Tariff Order dated 26.05.2017 being actual transmission losses achieved during FY 2015-16 and average of weekly losses for the grid filed by the Discoms respectively. 3.38 The levels of transmission losses as proposed by the Discoms and considered by the Commission for FY 2016-17 have been shown in the following table: Table 15: Levels of Transmission Loss (%) Particulars Intra-State Transmission Losses-Discoms Inter-State Transmission Losses- Discoms

Proposed for FY 2016-17 4.11% 3.15%

Approved by Commission for FY 2016-17 3.89% 3.15%

Energy Requirement as approved vis-à-vis Petitioners’ submission 3.39 On the basis of the sales and distribution & transmission losses discussed above, the energy requirement proposed by Discoms and approved by the Commission for FY 2016-17 is given in the following table:

Page 45 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 16: Energy Requirement for FY 2016-17 (MU) JVVNL Particulars Energy Sales to Consumers (MU) Distribution Loss (%) Add: Distribution Loss (MU) Energy Required at Discoms periphery (MUs) Intra-State Transmissio n Losses (%) Add: IntraState Transmissio n Losses (MU) Energy Requireme nt at Transco periphery Inter-State Transmissio n Losses (%) Add: InterStates Transmissio n Loss Gross Energy Requireme nt (MU)

AVVNL

JdVVNL

Total

Propose d

Approve d

Propose d

Approve d

Propose d

Approve d

Propose d

Approve d

19,304

19,134

13,902

13,773

18,000

17,379

51,205

50,286

25.00%

22.00%

22.00%

20.00%

19.00%

18.00%

6,435

5,397

3,921

3,443

4,222

3,815

14,578

12,655

25,738

24,531

17,823

17,216

22,222

21,193

65,782

62,940

4.11%

3.89%

4.11%

3.89%

4.11%

3.89%

1192

993

829

697

955

858

2975

2547

26930

25524

18651

17913

23177

22051

68758

65488

3.15%

3.15%

3.15%

3.15%

3.15%

3.15%

299

296

206

207

235

237

740

741

27229

25820

18857

18120

23412

22288

69497

66229

Page 46 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Power Purchase Cost Petitioners’ Submission 3.40 Discoms have projected energy availability for FY 2016-17 on the basis of estimated generation from existing stations and projected generation from new stations. For existing stations, the Discoms submitted that the power purchase quantum has been considered as per the actual energy received in previous years. The Discoms analyzed the existing power scenario and the power purchase has been accordingly projected considering the energy requirement and the merit order principles. The power purchase from stations which were commissioned in FY 2015-16 and were only available for part of the year has been computed based on capacity, PLF and Auxiliary consumption. 3.41 Discoms have submitted the following assumptions while projecting the power purchase cost for FY 2016-17: ·

For Coal, Gas and Hydro based Power Plants, an escalation rate in the range of 2% to15 % is considered over the per unit actual cost for FY 2015-16.

·

For Nuclear Power Plants, a nominal escalation rate of 2 % has been considered over average per unit tariff from nuclear sources as per DAE reply to Lok Sabha query dated 09.03.2016.

·

The fixed charges and variable charges for the plants which are going to be commissioned in FY 2016-17 have been assumed on the basis of similar types of plant.

·

The availability from RFF has been wholly allocated to JVVNL.

·

The purchase from renewable energy sources has been projected as per the RPO Obligation approved by the Commission.

3.42 Summary of the power purchase quantum and cost as submitted by Discoms in their petitions are as under: Table 17: Power Purchase (MU) and Cost (Rs. Cr.) for FY 2016-17 – submitted by Discoms Energy Availability (MUs) and Cost for FY 2016-17- Submission Stations NTPC

JVVNL Units 2260

AVVNL

Cost 717

Units 1582

JdVVNL

Cost 502

Units 1808

Cost 574

Total Units 5649

Cost 1793

Page 47 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Energy Availability (MUs) and Cost for FY 2016-17- Submission Stations

JVVNL Units

AVVNL

Cost

Units

JdVVNL

Cost

Units

Total

Cost

Units

Cost

NHPC

730

244

511

171

584

195

1824

611

RVUN

10195

4210

7137

2947

8156

3368

25489

10525

2559

1057

1791

740

2047

846

6396

2643

78

33

54

23

62

26

194

82

NPCIL

1227

358

859

250

982

286

3068

894

Share projects

1372

48

960

33

1097

38

3429

119

183

73

-

-

-

-

183

73

TEHRI

96

55

67

39

77

44

241

138

KOTESHWAR

43

17

30

12

35

13

108

41

Rajwest GLTPP

RFF

Tala SJVVN and Rampur

19

4

13

3

15

3

48

10

286

89

200

62

229

71

715

222

Neyveli lignite

441

163

309

114

353

130

1103

407

Aravali power

3

3

2

2

3

2

8

7

Coastal Gujarat Adani Power Rajasthan Limited

1004

241

703

169

803

193

2510

603

3297

1180

2308

826

2638

944

8243

2949

Sasan Power Ltd.

1161

193

813

135

929

155

2903

483

Karcham Wangtoo

177

60

124

42

142

48

443

151

NVVN Bundled

891

386

624

270

713

309

2228

966

2401

1175

1673

819

2106

1030

6180

3024

11

2

7

1

8

2

26

5

NCES CPP's New Stations (case 1 PPA, CTPP unit 5 and Teesta)

857

343

600

240

686

275

2142

858

29292

10651

20369

7401

23472

8553

73133

26605

Sale of surplus energy

2063

516

1512

378

61

15.13

3636

909

Net power purchase cost

27229

10135

18857

7023

23412

8538

69497

25696

Total

Commission’s Analysis 3.43 While estimating energy availability and power purchase cost for F Y 2016-17, the Commission has considered the generation from State and Central generating units based on the twelve months actual data submitted by the Discoms as referred to in foregoing paras. Likewise, the position as per latest tariff orders ( order/interim order) has also been considered in working out power purchase cost, as discussed later in the order.

Page 48 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

3.44 For estimating the power purchase cost, the Commission has considered availability from various sources for the State as a whole. For working out Discom wise availability and cost, the allocation of power to JVVNL, AVVNL and JdVVNL from all generating stations has been considered in the ratio of 40%, 28% and 32% respectively, except that 100% allocation of RFF share has been considered for JVVNL . Energy Availability and Cost for FY 2016-17 RVUN Stations 3.45 For RVUN generating stations, including KTPS (Unit 1-7) & STPS(Unit 1-6), DCCPP, RGTPS(Stage I, II& III), Mahi, MMH, Chhabra (Unit 1-4) & Kalisindh(Unit 1&2), the Commission has considered the energy availability as per actual purchase from April 2016 to March 2017. 3.46 The fixed and energy charges for the aforesaid RVUN plants are as per RVUN Tariff order dated 17.10.2016 for FY 2016-17 and applicable regulation. 3.47 Tariff of Mini/Micro (MMH) plants have been considered as per Regulation 58 of RERC Tariff Regulations, 2014. 3.48 The energy availability and cost of RVUN’s generating stations as considered by the Commission have been shown in the table below: Table 18: Energy Availability (MU) and Cost (Rs. Cr.)- RVUN Stations for FY 2016-17 Station Energy Availability Cost KTPS(1 to 7)

6628

2078

STPS(1 to 6)

4023

1679

DCCPP

95

43

RGTP(1&2)

432

153

RGTP 3

936

432

MAHI

209

49

MMH Chabbra – 1&2

9

3

3059

1077

Chabbra – 3

1515

597

Chabbra – 4

1559

575

Kalisindh unit 1

3415

1571

Kalisindh unit 2

2116 23996

927 9187

Total

Page 49 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Lignite based projects 3.49 The lignite based projects include Giral Lignite Power Limited, Rajwest Limited and Neyveli Lignite Corporation Limited. For Giral unit 1 & 2, Commission has not considered any generation for FY 2016-17 as the plant has not been functioning for a long period. The availability for Rajwest and Neyveli has been considered as per actual purchase of FY 2016-17. 3.50 The per unit charge for FY 2016-17 for Rajwest have been considered as per the Commission’s Tariff order dated 19.06.2017. 3.51 The fixed and variable charges of considered as per actual for FY 2016-17.

Neyveli project

has

been

3.52 The energy availability and total power purchase cost for Lignite based projects have been summarized in the table below: Table 19: Energy Availability (MU) and Cost (Rs. Cr.)- Lignite Plants for FY 2016-17 Energy Availability Total Cost Station Giral –1&2

0

0

Rajwest

5826

2121

Neyveli Lignite Corporation Ltd

1271 7097

506 2627

Total

Nuclear Power Corporation of India Ltd. (NPCIL) 3.53 Total power purchase quantum and power purchase cost for NPCIL have been considered as per actual purchase of FY 2016-17. 3.54 The energy availability and total power purchase cost for NPCIL plants have been summarized in the table below: Table 20: Energy Availability (MU) and Cost (Rs. Cr.)- NPCIL for FY 2016-17 Energy Availability Station NPCIL

2791

Total Cost 828

Page 50 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Partnership Projects (PP) and RFF 3.55 Total power purchase quantum and power purchase cost for partnership projects and RFF have been considered as per actual purchase of FY 2016-17. 3.56 Energy availability and total power purchase cost for partnership projects and RFF have been summarized in the table below: Table 21: Energy Availability (MU) and Cost (Rs. Cr.)- Partnership Projects for FY 2016-17 Energy Availability Total Cost Station Partnership Projects

2915

103

RFF

122

49

NTPC, NHPC & Others 3.57 The energy availability and charges for NTPC & NHPC plants have been considered as per actual purchase of FY 2016-17. 3.58 The energy availability and charges of Tehri, Koteshwar, Tala, Rampur, SJVNL, Aravali, Adani, Sasan, NVVN, Coastal Gujarat, Karcham Wangtoo and new PPA have been considered as per actual of FY 2016-17. 3.59 The energy availability and total power purchase cost for NTPC, NHPC and other plants have been summarized in the table below: Table 22: Energy Availability (MU) and Cost (Rs. Cr.)- NTPC & NHPC and Other Generating Stations for FY 2016-17 Plants Energy Availability Total Cost NTPC Stations

5893

1783

NHPC Stations

1698

616

Rampur+Aravali+ Adani+ Sasan+ SJVVNL+NVVN+coastal Guj.+Wangtoo+other

17171

5714

Tehri Hydro

245

126

Koteshwar

106

41

49 25162

10 8289

Tala Total

Non-Conventional Energy Sources 3.60 The Commission has taken the availability from non-conventional energy sources to the extent of RPO requirement, i.e., 7.80% for wind, 1.10% for Bio-mass and 2.50% for Solar. Page 51 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

3.61 The availability has been considered as per RPO and the per unit cost has been considered as per actual. Table 23: Energy Availability (MU) and Cost (Rs. Cr.)- Wind, Solar & Biomass for FY 201617 Energy Availability Total Cost Plants Wind farms 5166 2571 Solar 1656 764 Biomass 729 484 Total

7550

3819

Short term Sources 3.62 After considering the energy available to Discoms based on their respective allocated shares, the Commission has estimated a surplus in JVVNL & AVVNL and deficit in JdVVNL in energy availability. 3.63 Discoms have proposed to sell the surplus power at the rate of Rs. 2.50 per unit. In this context, the Commission agrees with the Stakeholders’ concern that the Discoms must try to sell the surplus power at higher rate than the variable charges of thermal generation, for example, STPS variable charges of Rs. 3.32 per unit plus some margin. In light of above fact, the Commission has considered the sale price of surplus power at Rs. 4.00 per unit. 3.64 However, there may have been a situation when Discoms may have resorted to short term power purchase. In that situation, the Regulation 79(6) provides that the Commission shall indicate a tariff for procurement of short term power. Accordingly, the Commission deems it proper to continue with the rate of Rs. 4/unit considered for this purpose in last year tariff order dated 22.09.2016. 3.65 It has also been observed that while the two Discoms are having surplus while the other Discom is having shortage. This is due to allocation of power in certain ratio to respective Discom. The Discoms may take up the matter with Government for suitable amendment in existing allocation ratio as per requirement. Total Power Purchase Cost 3.66 Based on the above, the summary of source wise and Discom wise breakup of power purchase quantum and cost for 2016-17 as Page 52 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

considered by the Commission for the three Discoms is given in the table below: Table 24: Energy Availability (MU) and Cost (Rs. Cr.) for FY 2016-17 Stations JVVNL AVVNL JdVVNL Units Cost Units Cost Units Cost NTPC 2357 713 1650 499 1886 570 NHPC 679 246 475 172 543 197 NPCIL 1116 331 781 232 893 265 Tehri+Koteshwar+Tala 160 71 112 49 128 57 RVUN/ State Generation 11929 4523 8350 3166 9543 3618 Shared Projects 1166 41 816 29 933 33 RFF 122 49 NCES 3020 1528 2114 1069 2416 1222 SJVN and Rampur 285 89 199 62 228 71 New Stations 260 107 182 75 208 85 Aravali+ Adani+ Sasan+ Neyveli+costal 5871 1863 4109 1304 4696 1490 Guj.+Wangtoo NVVN Bundled 962 430 674 301 770 344 TOTAL 27927 9990 19463 6959 22244 7953 Less/add: Short Term -2107 -843 -1343 -537 44 18 Net power Purchase 25820 9147 18120 6422 22288 7971

Total Units Cost 5893 1783 1698 616 2791 828 400 177 29823 11307 2915 103 122 49 7550 3819 712 222 649 266

14676 2406 69634 -3405 66229

4657 1074 24902 -1362 23540

Transmission Charges Petitioners ‘Submission 3.67 For estimation of the RVPN transmission charges and SLDC charges for FY 2016-17, the escalation rate in the range of 5%-15% is considered over the actual cost of FY 2015-16. Further, for estimating the PGCIL charges, the Discoms have considered an escalation rate of approx. 5% over the PGCIL transmission charges as payable during FY 2015-16. 3.68 The details of the transmission and SLDC charges submitted by Discoms have been summarized in the table below: Table 25: Transmission Charges & SLDC Charges for 2016-17 (Rs. Crore) Particulars JVVNL AVVNL JdVVNL PGCIL Charges 548 384 438 RVPN Charges 916 642 733 SLDC Charges 7 5 6 RLDC Charges 1 1 1

Total 1370 2291 18 4 Page 53 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars Total Transmission Charges

JVVNL 1473

AVVNL 1031

JdVVNL 1178

Total

3683

Commission’s Analysis 3.69 The Commission has considered the RVPN and SLDC charges for FY 2016-17 as per the RVPN tariff order dated 27.10.2016 for FY 2016-17. 3.70 The Commission has considered the other transmission, PGCIL and RLDC charges as proposed by Discoms for FY 2016-17. 3.71 The transmission & SLDC charges accordingly approved by the Commission for FY 2016-17 are as under: Table 26: Transmission Charges approved by the Commission for FY 2016-17 (Rs. Crore)

Particulars PGCIL Charges RVPN and Other Charges RLDC Charges SLDC Charges Total Transmission Charges

JVVNL 548 954 1 4 1508

AVVNL 384 668 1 3 1055

JdVVNL 438 763 1 3 1206

Total 1370 2386 4 9 3769

Operation and maintenance Expenses Petitioners’ Submission 3.72 Discoms have estimated O&M expenses based on the O&M norms specified in RERC Tariff Regulations, 2014. 3.73 the O&M expenses projected by Discoms for FY 2016-17 have been summarized below: Table 27: Operation and Maintenance Expenses for FY 2016-17 (Rs. Crore) Particulars Employee Costs

JVVNL

AVVNL

JdVVNL

Total

822

592

766

2180

87

62

74

223

Repairs & Maintenance Costs

173

125

149

446

Total O&M Costs

1081

779

989

2849

Less: Expenses to be Capitalized

285

15

146

445

Net O&M Costs charged to revenue

797

764

844

2404

Administrative & General Costs

Page 54 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Commission’s Analysis 3.74 Commission has allowed O&M expenses Regulation 83 of RERC Tariff Regulations, 2014.

in

accordance

with

3.75 The per unit norms for each component for first year of the control period FY 2014-15 are as follows: · · ·

Employee expenses-Rs. 0.38/per unit of sale A&G expenses-Rs. 0.04/ per unit of sale R&M Expenses –Rs. 0.08/ per unit of sale

3.76 As per regulation 24(3), the Commission has escalated the O&M expenses at the rate of 5.85% per annum for FY 2016-17. 3.77 Commission has considered the sales allowed for FY 2016-17 for projecting normative O&M expenses. Capitalized O&M expenses have been considered in the same ratio as projected by Discoms. 3.78 O&M expenses approved by the Commission for Discoms for FY 2016-17 have been summarized below: Table 28: Operation and Maintenance Expenses approved for FY 2016-17 (Rs. Crore) Particulars JVVNL AVVNL JdVVNL Total Employee Costs

815

586

740

2141

Administrative & General Costs

86

62

78

225

Repairs & Maintenance Costs

172

123

156

451

Total O&M Costs

1072

772

974

2817

Expenses to be Capitalized Net O&M Costs charged to revenue

282 790

15 757

143 830

440 2377

Terminal Benefit Expenses Petitioners’ Submission 3.79 T h e Discoms have considered the terminal benefits for FY 2016-17 as per the liability assessed in the actuarial valuation for the FY 2015-16. 3.80 The terminal benefit liability submitted by the Discoms for FY 2016-17 has been tabulated below: Table 29: Terminal Benefit Expenses for FY 2016-17 (Rs. crore) Particulars JVVNL AVVNL Terminal Benefit Expenses

700

Petition No. RERC 1077/17, 1078/17, 1076/17

569

JdVVNL 298

Total 1567 Page 55 of 146

Commission’s Analysis 3.81 The Commission has considered terminal benefit expenses for FY 2016-17 as submitted by Discoms. However, the Commission shall allow the payment made towards actuarial valuation liability in the true up of FY 2016-17 only to the extent of funds actually transferred to the designated Fund. Capitalization Petitioners’ Submission 3.82 The capital investment and capitalization proposed by Discoms are shown in the table below: Table 30: Capital Expenditure and Capitalization proposed for FY 2016-17 (Rs. crores) Particulars JVVNL AVVNL JdVVNL Capital Expenditure 1807 1244 1345 2355

Capitalization

2333

1999*

*Before assets not in use as given in format 3.6 of the petition

Commission’s Analysis 3.83 Following the methodology adopted in 22.09.2016 order for FY 201516, the Commission has considered 80% of the proposed capitalization in this ARR order as under. Table 31: Projected Capitalization approved by the Commission for FY 2016-17 (Rs. Crore)

Particulars

JVVNL

AVVNL

1884

1866

Capitalization

JdVVNL 1599

Interest on Loans and Finance Charges & Lease rental Petitioners’ Submission 3.84 To compute the interest on loan, Discoms have considered opening normative loan as on 1st April 2016 equivalent to closing balance of long term loans for FY 2015-16 as per audited accounts for the year. Further, capitalisation during the year after deducting consumer contribution, normative equity @30% of the remaining capitalisation and the balance amount has been considered as addition to long term Page 56 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

loans during the year. The loan repayment has been considered in accordance with Regulation 21 of the RERC Tariff Regulations, 2014 which caps deemed repayments to the extent of depreciation charged for the year. The closing normative loan is considered after aforesaid addition to loan and deducting normative repayment for FY 2016-17. 3.85 The interest on long term loans is estimated on the basis of actual weighted average interest rate for long term loans and applied on the average of normative loans (average of opening and closing normative loan). 3.86 The Discoms have projected interest on security deposit on the basis of average of actual security deposit per consumer in the previous two years as per audited accounts of FY 2014-15 and 2015-16 and the projected growth in number of consumers. The interest rate has been considered as per the applicable RBI bank rate as on 1st April, 2016 i.e. 7.75% in accordance with the RERC Supply Code. 3.87 Discoms have projected the finance charges and other borrowing cost to be increased by 5% per annum from audited accounts for FY2015-16. 3.88 The Unfunded Gap and interest thereon upto FY 2015-16 has been separately shown by the Discoms as under: a) Discoms submitted the following factual position of loan taken over under UDAY Scheme. S. No. A B C D E F G

Description Accumulated Losses as on 31.03.2016 as per balance sheet Losses owned by GoR Subsidy received against losses owned by GoR Actual Accumulated Losses as on 31.03.2016 (A + B - C) Loans taken over under UDAY Difference (D - E) Unfunded gap approved by the Commission Unfunded gap considered for computation of interest liability (Min of F,G)

JVVNL 32,294 2,867 978

AVVNL 30,348 2,701 834

JDVVNL 30,010 2,947

Total 92,652

906

34,183 20,998 13,185

32,215 20,569 11,646

32,051 19,290 12,761

98,449 60,857 37,592

15,392

15,918

16,536

47,846

13,185

11,646

12,761

37,592

Page 57 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

b) From the above table, it is observed that the Government’s have actually taken over loan of Rs. 60857 crore. Further, for the purpose of computing the interest on unfunded gap upto 2015-16, Discoms have considered the lower of following: i. Accumulated Gap after UDAY of Rs. 37592 crore and

ii. Unfunded gap approved by the Commission of Rs. 47846 crore. 3.89 Accordingly, the interest charges and finance charges for FY 2016-17 have been summarized in the table below: Table 32: Interest and Financing Charges for FY 2016-17 (Rs. Crore) Descriptions JVVNL AVVNL

JdVVNL

Total

Opening balance of LTL

4558

4070

4389

13017

Capitalization

2355

2333

1999

6686

Capital expenditure financed by Equity

634

578

420

1632

Capital expenditure financed by Consumer Contribution and grants

241

406

598

1245

1480

1349

980

3809

773

510

522

1805

5265

4908

4848

15021

4911 12.40% 609

4489 12.91% 580

4618 13.03% 602

14019

Interest on Security Deposit

83

58

51

191

Finance Charges & Lease Rental

98

96

294

488

Gross Interest Charges

790

733

947

2470

Interest Expenses Capitalized

145

93

32

270

Total Interest & Financing Charges

645

640

915

2200

13185

11646

12761

37592

12.40%

12.91%

13.03%

Interest liability on unfunded gap

1635

1504

1663

4801

Total Interest & Financing Charges

2280

2144

2578

7001

Receipt of LTL for Capital expenditure Principal Repayment Closing balance of LTL Average LTL Average Interest rate of LTL (%) Interest Charges on LTL

unfunded Gap up to FY 16 Average ROI

1790

Commission’s Analysis 3.90 The interest and finance charges have been calculated by the Commission considering the following: Page 58 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

a) The closing balance of long-term loans for FY 2015-16 allowed in the true-up order of FY 2015-16, has been considered by the Commission as the opening balance of FY 2016-17. b) For capitalization for FY 2016-17 only 80% capitalization has been considered by the Commission, the equity, consumer contribution and grants have also been considered on proportionate basis. c) The long-term loans required for capitalization during the FY 2016-17 have been reduced by the amount of consumer contribution, capital grants and equity received during the year. d) Repayment for FY 2016-17 has been considered equal to the depreciation allowed by the Commission for FY 2016-17. e) With regard to Unfunded Gap, it is observed that the Discoms have signed the MoU under “UDAY” scheme, wherein the Government’s have taken over the accumulated debt of Rs 60857 crore subject to achievement of certain conditions as discussed in foregoing paras of distribution losses, the Commission has considered the unfunded gap for FY 2016-17 as under: i). The Discoms have submitted the total accumulated losses of Rs. 98449 crore as on 31.03.2016. ii). As the above losses have been met through loan, the government have taken over outstanding loan of Rs. 60857 crore. iii). After, taking over of loan of Rs. 60857 crore, the Discoms have been left with accumulated gap of Rs. 37592 crore. This gap is lesser than the Commission approved unfunded gap of Rs. 51867crore as on 31.03.2016, thus for computing the carrying cost, Commission has considered the lower of the two gaps i.e. Rs. 37592 Core f) The weighted average interest rate has been considered at 10.12%, 11.39% and 9.11% respectively as per regulation 21(5) of RERC tariff Regulations, 2014. g) Finance charges have been allowed as sought by the three Page 59 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Discoms i.e. escalation of 5% over the finance charges of FY 2015-16, whereas in case of JdVVNL, the finance charges for FY 2015-16 was inclusive of delayed payment surcharge to power producers, thus the same has been removed first and escalation has been considered thereafter. h) Interest on Security deposit has been considered as submitted by Discoms. 3.91 Based on the above, the approved interest and finance charges (with respect to the assets capitalized) approved for FY 2016-17 for the three Discoms have been summarized in the tables below: Table 33: Interest and Finance Charges approved by the Commission for FY 2016-17 (Rs. Crore)

Particular Opening balance of LTL (A)

JVVNL

AVVN L

JdVVN L

Total

5435

2896

2914

11246

Capitalization (B)

1884

1866

1599

5349

Capital expenditure financed by Equity (C)

507

462

336

1306

Capital expenditure financed by Consumer Contribution and grants (D)

193

325

479

996

Receipt of LTL for Capital expenditure E=(B-C-D)

1184

1079

784

3047

Principal Repayment(F)

622

397

379

1399

Closing balance of LTL, G=(A+E-F)

5997

3578

3319

12894

Average LTL, H=(A+G)/2

5716

3117

12070

10.12%

3237 11.39 %

9.11%

Interest Charges on LTL, J=(HXI)

578

369

284

1231

Interest on Security Deposit (K)

83

58

51

191

Finance Charges & Lease Rental (L)

98

96

93

287

Gross Interest Charges, M=(J+K+L)

759

522

428

1710

Interest Expenses Capitalized (N)

139

66

14

220

Total Interest & Financing Charges (O)

620

456

414

1490

Unfunded Gap upto FY 2015-16 (P)

13185

11646

12761

37592

Interest on Carry Forward Revenue Gap, Q=(PXI) Total Interest & Financing Charges after interest on carry forward Gap (O+Q)

1334

1326

1163

3823

1954

1783

1576

5313

Average Interest rate of LTL (%)(I)

Page 60 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Interest on Working Capital Petitioners’ Submission 3.92 Discoms estimated their working capital requirement for FY 2016-17 as per Regulation 27 of the RERC Tariff Regulations, 2014 and the same has been tabulated below: Table 34: Interest on Working Capital for FY 2016-17 (Rs. Crore) Descriptions JVVNL AVVNL O&M expenses (as per norms) 66 64 Maintenance Spare (as per norms)

JdVVNL 70

Total 200

120

115

171

405

2047

1493

1711

5252

Security deposit of Consumers

1068

744

655

2468

Total Working Capital

1165

927

1298

3390

11.80% 137

11.80% 109

11.80% 153

400

Receivables (as per norms) Less:

Interest Rate (%) Interest on Working Capital

3.93 The Petitioner has further submitted that it has considered the latest base rate of State Bank of India of FY 2016-17 plus 250 basis points. Commission’s Analysis 3.94 The normative working capital requirement along with interest thereon has been calculated as per regulation 27 of RERC Tariff Regulations, 2014, by the Commission as under: a)

Operation and Maintenance expenses for one month; plus

b)

Maintenance spares @15% of O&M expenses as per Regulation 83 of the RERC Tariff Regulations 2014; plus

c)

Receivables equivalent to one and a half-months billing of consumers; Less

d)

The security deposits as submitted by the Discoms have been considered;

e)

For the purpose of calculating interest on working capital, Page 61 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

the Commission has considered weighted average SBI base rate prevalent during first six months of the previous year plus 250 basis points as per RERC Tariff Regulations, 2014. The rate of interest thus works out to 12.26% 3.95 Accordingly, the interest on working capital considered by the Commission is as under: Table 35: Interest on Working Capital approved by the Commission for FY 2016-17 (Rs. Crore)

Particulars

JVVNL

AVVNL

JdVVNL

Total

O&M expenses (as per norms)

66

63

69

198

Maintenance Spare (as per norms)

118

114

125

357

Receivables (as per norms)

1800

1312

1494

4605

Security deposit of Consumers

1068

744

655

2468

Total Working Capital

916

744

1032

2692

12.26% 112

12.26% 91

12.26% 127

330

Less:

Interest Rate (%) Interest on Working Capital

Depreciation Petitioners’ Submission 3.96 The Discoms have submitted that for computation of depreciation they have considered the specified rates as provided in the RERC Tariff Regulations, 2014 in Appendix-I based on Straight Line Method (SLM) 3.97 The submission of the three Discoms with respect to depreciation has been tabulated below: Table 36: Depreciation for FY 2016-17 (Rs. crore) Particulars JVVNL AVVNL 773 510 Depreciation

JdVVNL 522

Total 1805

Commission’s Analysis 3.98 Commission has considered depreciation based on the following consideration: ·

The closing balance of depreciable assets for FY 2015-16 allowed in the True-up order for FY 2015-16 has been Page 62 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

considered by the Commission as the opening balance for FY 2016-17. ·

Capitalization, consumer contribution and grants for FY 201617 has been considered as discussed earlier.

·

Depreciable assets for FY 2016-17 have been reduced by the amount of consumer contribution and capital grants projected for the year.

·

Average depreciation rate has been considered as per true up order for FY 2015-16.

3.99 Deprecation allowed by the Commission for each of the three Discoms has been tabulated below: Table 37: Depreciation allowed by the Commission for FY 2016-17 (Rs. Crore) Particulars JVVNL AVVNL JdVVNL Depreciable Assets at the beginning of the Year (A) 11753 7833 7692 Capitalization during the year (B) 1884 1866 1599 Consumer Contribution and Capital Grants during the year (C) Depreciable Assets added during the Year D=(B-C) Depreciable Assets at the end of the Year (E= (A+D)) Average Depreciable Assets during the Year (F=(A+E)/2) Average Depreciation Rate (G) Depreciation (FXG)

Total 27278 5349

193

325

479

996

1691

1541

1120

4353

13445

9374

8812

31631

12599

8603

8252

29454

4.94%

4.61%

4.60%

622

397

379

1399

Insurance Expenses Petitioners’ Submission 3.100 D is c o m s have estimated the Insurance expenses for FY 2016-17 on the basis of net fixed assets subject to the ceiling specified in Regulation 25 of the RERC Tariff Regulations, 2014. Table 38: Insurance Expenses- Discoms submission for FY 2016-17 (Rs. in Crore) Particulars Insurance charges

JVVNL 23

AVVNL 16

JdVVNL 17

Total 56

Page 63 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Commission’s Analysis 3.101 C o m m i s s io n has allowed Insurance expenses in accordance with Regulation 25 of RERC Tariff Regulations, 2014. 3.102 To c o m pu te the insurance expenses on average Net Fixed Assets (NFA) as per aforesaid regulation, the Commission has considered the following: a)The closing Net Fixed Assets as per Audited Accounts for FY 2015-16 is considered as opening balance as 1.04.2016. b)The additional capitalization as discussed in above para’s have been added and depreciation during the year has been deducted from the above opening balance to arrive at closing balance. 3.103 A c c o r d in g l y , the following insurance expenses have been computed on the average NFA. Table 39: Insurance Expenses Approved for FY 2016-17 (Rs. in Crore) JVVNL AVVNL JdVVNL Particulars

Total

23

55

Insurance charges

15

16

Return on Equity Petitioners’ Submission 3.104 Discoms have not claimed return on equity for FY 2016-17. Commission’s Observation 3.105 As Discoms have not sought Return on Equity, the Commission has also not considered Return on Equity. Interest on Delayed Payment Surcharge Petitioners’ Submission 3.106 Discoms in their petition for FY 2016-17 have claimed the interest on principle amount of Delayed Payment Surcharge (DPS) stating that the consideration of DPS from books of accounts adversely affects the Page 64 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

revenue gap of the Discoms. If the accrued DPS is considered to form part of Non Tariff Income, the financing cost for corresponding receivables must also be considered. Commission’s Observation 3.107 This matter of interest on DPS can be examined based on actual and audited data, as ARR petitions for FY 2016-17 are based on projections and un-audited data, therefore, the Commission is not inclined to examine this matter in the current petition and direct the Discoms to take up this matter while filing the petition for true-up for FY 2016-17 wherein Discoms should furnish detailed calculations corroborating their claim based on actual/audited data. Non-Tariff Income and Wheeling Charges Petitioners’ Submission 3.108 Discoms have projected Non-Tariff Income for FY 2016-17 using the escalation of 5% per annum on the figures of FY 2015-16. No increase has been considered for projecting income from wheeling and reactive energy charges for FY 2016-17. Further, income from cross subsidy surcharge and additional surcharge have also been projected for FY 2016-17 based on the rates approved by the Commission and the projections made for energy drawl through open access as given below: Table 40: Non-Tariff Income for FY 2016-17 (Rs. Crore) Particulars JVVNL Non-Tariff Income Income from Wheeling Charges, Cross Subsidy Surcharge and Additional Surcharge Total

AVVNL

JdVVNL

Total

317

247

386

950

142 459

349 596

68 454

559 1509

Commission’s Analysis 3.109 The Commission has considered the non-tariff income and wheeling charges for FY 2016-17 as projected by Discoms.

Page 65 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Aggregate Revenue Requirement Petitioners’ Submission 3.110 The Annual Revenue Requirement for FY 2016-17 proposed by the three Discoms has been given in the table below: Table 41: Summary of ARR for FY 2016-17 – Discoms’ submission (Rs. Crore) Sr. No.

1 2

3 4 5 6 6 7 8 9 10 11 12

Particulars

JVVNL

Power Purchase Cost* Transmission Charges PGCIL RVPN SLDC and RLDC Operation & Maintenance Expenses Terminal Benefit Interest and Finance Charges Interest on unfunded gap Interest on working Capital Depreciation Insurance charges Aggregate Revenue Requirement Less: Non-Tariff Income Less: Cross Subsidy and Additional Surcharge Net Aggregate Revenue Requirement

10135 0 548 916 9 797 700 645 1635 137 773 23 16319 317 142 15860

AVVNL JdVVNL Submission FY 2016-17 7023 8538 0 0 384 438 642 733 6 7 764 844 569 298 640 915 1504 1663 109 153 510 522 16 17 12166 14129 247 386 349 68 11570 13675

Total

25696 0 1370 2291 21 2404 1567 2200 4801 400 1805 56 42614 950 559 41105

*

*Power purchase cost has been considered after adjustment of sale of surplus power

Commission’s Approval 3.111 Commission has approved the ARR for FY 2016-17 based on the items of expenditure discussed in the preceding sections and the same has been summarized in the table below: Table 42: Summary of ARR for all the three Discoms for FY 2016-17 – Approved by Commission (Rs. Crore)

Sr. No.

1 2

3 4 5 6

Particulars

Power Purchase Cost* Transmission Charges PGCIL RVPN SLDC and RLDC Operation & Maintenance Expenses Terminal Benefit Interest and Finance Charges Interest on unfunded gap

JVVNL

9147 548 954 5 790 700 620 1334

AVVNL JdVVNL Approved FY 2016-17 6422 7971 384 668 4 757 569 456 1326

438 763 4 830 298 414 1163

Total

23540 1370 2386 13 2377 1567 1490 3823

Page 66 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Sr. No. 7 8 9 10 11 12 13

Particulars Interest on working Capital Depreciation Insurance charges Aggregate Revenue Requirement Less: Non-Tariff Income Less: Cross Subsidy and Additional Surcharge Net Aggregate Revenue Requirement

JVVNL 112 622 23 14857 317 142 14398

AVVNL 91 397 15 11089 247 349 10493

JdVVNL 127 379 16 12404 386 68 11950

Total 330 1399 55 38349 950 559 36841

*Power purchase cost has been considered after adjustment of sale of surplus power

Revenue and Revenue Deficit based on Existing Tariff Revenue on Existing Tariff Petitioners’ Submission 3.112 Discoms have projected the revenue based on energy sales forecasts for the period and the applicable retail tariff as per the RERC’s Tariff Order for FY 2015-16 dated 22nd September 2016 3.113 The revenue in FY 2016-17 from existing tariff as per Discoms’ submission is as under: Table 43: Revenue from existing tariff for FY 2016-17– Discoms’ submission (Rs. Crore) Particulars JVVNL AVVNL JdVVNL Total Domestic Service 3508 2434 2319 8261 Non-Domestic Service Public Street Light Agriculture Metered Supply Agriculture Flat Rate Supply Small Industrial Service Medium Industrial Service Large Industrial Service P.W.W. & S. Pumping –Small P.W.W. & S. Pumping –Medium P.W.W. & S. Pumping –Large Mixed Load / Bulk Supply Electric Traction Total

1993

983

941

3917

129 2747 93 222 576 2731 152 31 207 133 291 12812

55 2045 445 207 621 1934 179 32 142 87 0 9164

91 4284 307 171 496 1087 165 78 376 271 0 10586

274 9077 845 600 1693 5752 496 141 725 491 291 32561

Interest subvention, Electricity Duty and Subsidy 3.114 Discoms have shown Differential Interest Subvention on World Bank Loan, Subvention from State Govt against electricity duty, Subsidy Page 67 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

against compounding charges for FY 2016-17 as under: Table 44: Interest subvention, electricity duty and subsidy for FY 2016-17 (Rs. Crore) JVVNL AVVNL JdVVNL Total Submission Particular FY 2016-17 Differential Interest Subvention on World Bank Loan 4 3 3 10 Subvention from State Govt. against ED 564 376 362 1302 Subsidy against compounding charges 15 6 10 31 Total Subsidy Amount 583 385 375 1343

Revenue Deficit 3.115 The revenue deficits submitted by Discoms for FY 2016-17 at the existing tariff have been provided in the table below:Table 45: Revenue Deficit/Surplus at existing tariff for FY 2016-17 (Rs. Crore) Particulars

Net Aggregate Revenue Requirement (A) Revenue from Existing tariff (B) Total of interest on subvention, ED and Subsidy (C) Deficit including Carrying cost D= (A-B-C) Carrying cost on revenue deficit as per SBI base rate during the first half (E) Gap after last year Losses claimed By Discoms (D+E)

JVVNL

15,860 12,812 583 2,465

AVVNL JdVVNL Submission FY 2016-17 11,570 13,675 9,164 10,586 385 375 2,021 2,714

Total

41,105 32,561 1,343 7,200

153

130

177

460

2,618

2,151

2,891

7660

Commission’s Analysis: 3.116 Commission has calculated the revenue from existing tariff on the basis of consumer category wise energy sales approved by the Commission in this order for FY 2016-17, retail tariff notified for the first 5 months of FY 2016-17 as per tariff order dated 20.02.2015 and remaining 7 months as per tariff order dated 22.09.2016. The estimated revenue at existing tariff for different consumer categories for all the three Discoms for FY 2016-17 has been summarized in the table below: Table 46: Revenue from Existing Tariff for FY 2016-17- Approved by the Commission (Rs. Crore) JVVNL AVVNL JdVVNL Total Approved Particular FY 2016-17 Domestic Service 3178 2265 2177 7,620 Non-Domestic Service 1935 982 939 3,856 Public Street Light 134 56 72 261 Agriculture Metered Supply 2773 2047 4245 9,066

Page 68 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

JVVNL Particular Agriculture Flat Rate Supply Small Industrial Service Medium Industrial Service Large Industrial Service P.W.W. & S. Pumping –Small P.W.W. & S. Pumping –Medium P.W.W. & S. Pumping –Large Mixed Load / Bulk Supply Electric Traction Total

192 218 553 2972 153 30 219 152 157 12,664

AVVNL JdVVNL Approved FY 2016-17 505 491 203 165 611 481 1936 1010 183 164 49 73 150 353 78 260 9,064

10,430

Total

1,188 586 1,646 5,918 500 151 722 489 157 32,159

ARR and Revenue 3.117 Considering the ARR and Revenue at existing tariff as determined by the Commission and subsidy & subvention as shown by Discoms in their petition, the revenue gap for all the three Discoms for FY 2016-17 at the existing tariff has been worked out. The Commission has carried out the true up of RVUN for FY 2013-14, FY 2014-15 and FY 2015-16 wherein certain amount has been considered as payable by Discoms, the same has also been considered while working out the gap for FY 2016-17. Table 47: Revenue Deficit/Surplus at existing tariff for FY 2016-17 – Approved by the Commission (Rs. Crore)

Particulars

JVVNL

Net Aggregate Revenue Requirement (A) Revenue from Existing tariff (B) Total of interest on subvention, ED and Subsidy (C) Deficit including Carrying cost D= (A-B-C) Add: RVUN True For FY 2013-14, FY 2014-15 and FY 2015-16 Add: Consumer Education Net Deficit including Carrying cost

14,398 12,664 583 1,150 74.50 0.50 1225

AVVNL JdVVNL Approved FY 2016-17 10,493 11,950 9,064 10,430 385 375 1,043 1,145 52.15 59.60 0.50 0.50 1096 1205

Total

36,841 32,159 1,343 3,338 186.26 1.50 3526

Page 69 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Section-4: Annual Revenue Requirement 4. Annual Revenue Requirement for FY 2017-18: 4.1 Determination of ARR requires assessment of energy sales as well as cost of various elements like power purchase cost, O&M expenses, interest cost and depreciation, etc. Projection of the Petitioners with respect to various components of ARR, the Commission’s analysis thereon after consideration of views expressed by the Stakeholders and decision with respect to items given below are discussed in the following paras: Energy Sales 4.2 Discoms have worked out the energy sales for FY 2017-18 on the basis of the audited figures of FY 2015-16 as well as actual data for the past years. The consumer category wise sales projected by the three Discoms and the energy sales being approved now by the Commission have been discussed in the following sub-paras. 4.3 The Discoms have projected the energy sales for FY 2017-18 for the following consumer categories: (1) All consumer categories, except agriculture (2) Agriculture consumers (Metered) (3) Agriculture consumers (Flat Rate)

Petitioners’ Submission Energy Sales for Metered Categories (except Agriculture) 4.4 T h e Discoms have submitted that they have worked out energy sales for FY 2017-18 on the basis of historical sales data and audited figures of sales for FY 2015-16 using the category wise CAGR as per methodology approved by Commission in the previous year’s tariff order and on the basis as explained in above paras for FY 2016-17 . Energy sales to Agriculture Metered (M) Consumers 4.5 The energy sales for agriculture metered category have been Page 70 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

estimated on the basis of the following factors: a) Existing Consumers at the start of the Financial Year b) Addition in the consumers during the Financial Year. c) Consumers converted from ‘Agriculture Flat’ to ‘Agriculture Metered’ category. d) Connected load per consumer. e) Estimated specific energy consumption. 4.6 The connected load per consumer has been forecasted based on the trend observed in previous years and the growth anticipated in connected load per consumer due to the decrease in the water table. 4.7 The Discoms submitted that, they have considered the specific consumption of 2030 kWh/kW/year for JVVNL, 1621 kWh/kW/year for AVVNL and 1868 kWh/kW/year for JdVVNL. 4.8 The Discoms have furnished the following sales to Agriculture Metered category for FY 2017-18 in their petition:

Table 48: Agriculture (M) sales for FY 2017-18-JVVNL Particulars Consumers Connected Total Specific Consumption (Nos.) Load per Connected consumption (Sales) MU consumer Load (kW) (kWh/kW/year) (kW) Existing consumers 4,66,930 6.12 28,55,457 2030 5,795 New Consumers 15,000 6.12 91,731 2,030 186 Add: converted from flat rate 10,000 7.60 76,044 2,030 154 Total 4,91,930 30,23,232 6,136 Table 49: Agriculture (M) sales for FY 2017-18- AVVNL Connecte Total Consumers d Load Connecte Particulars per (Nos.) d Load consume (kW) r (kW)

Existing consumers

3,88,409

6.54

25,38,719

Specific consumption (kWh/kW/yea r)

1621

Consumpti on (Sales) MU

4,115 Page 71 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars

Add: New Consumers Add: converted from flat rate Total

Consumers (Nos.)

Connecte d Load per consume r (kW)

Total Connecte d Load (kW)

Consumpti on (Sales) MU

7,500

6.54

49,022

1,621

79

15,000

11.52

1,72,792

1,621

280

4,10,909

27,60,533

Table 50: Agriculture (M) sales for FY 2017-18- JdVVNL Connected Total Load per Particulars Consumers Connected (Nos.) consumer Load (kW) (kW) Existing consumers Add: New Consumers Add: converted from flat Totalrate

Specific consumption (kWh/kW/yea r)

4,475

Specific Consumpti consumption on (kWh/kW/year) (Sales) MU

2,93,528

18.15

53,26,826

1,868

9,953

15,000

18.15

2,72,214

1,868

509

10,000

17.74

1,77,420

1,868

331

3,18,528

10,793

Energy Sales for Agriculture Flat Rate (FR) Consumers 4.9 For projecting the sales for agriculture (flat) category for FY 2016-17, Discoms have considered the specific consumption of 1945 kWh/kW/year as approved earlier by the Commission and the connected load per consumer as projected for FY 2016-17 has been kept at same level for FY 2017-18. 4.10 Discoms indicated the following details regarding the number of flat rate consumers, connected load and specific consumption: Table 51: Agriculture (FR) Sales for FY 2017-18 – JVVNL Connected Total Consumers Load per Connected Particulars (Nos.) consumer Load (kW) (kW)

Specific consumption (kWh/kW/year)

Consumption (Sales) MU

Page 72 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars Existing consumers Less: converted to meter Total

Consumers (Nos.)

Connected Load per consumer (kW)

Total Connected Load (kW)

Specific consumption (kWh/kW/year)

Consumption (Sales) MU

11,694

7.60

88,925

1,945

173

10,000

7.60

76,044

1,945

148

1,694

25

Table 52: Agriculture (FR) Sales for FY 2017-18– AVVNL Connecte Total Consumers d Load Connected Particulars (Nos.) per Load (kW) consumer (kW) Existing consumers 37,691 11.52 4,34,179 Less: converted to meter 15,000 11.52 1,72,792 Total 22,691 Table 53: Agriculture (FR) Sales for FY 2017-18 – JdVVNL Connected Total Consumers Load per Connected (Nos.) consumer Particulars Load (kW) (kW) Existing consumers Less: converted to meter Total

Specific consumption (kWh/kW/yea r)

Consumpti on (Sales) MU

1,945

844

1,945

336 508

Specific consumption (kWh/kW/yea r)

Consumptio n (Sales) MU

17,034

17.74

3,02,218

1,945

588

10,000

17.74

1,77,420

1,945

345

7,034

243

Total energy sales projected by Discoms: 4.11 The projection of energy sales of different consumer categories discussed in preceding sub-paras is given in the following table:

Page 73 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 54: Total Energy Sales for FY 2017-18- Discoms’ Projection (MU)

Particular Domestic Non-Domestic Public Street Light Agriculture (Metered) Agriculture (Flat) Small Industry Medium Industry Large Industry Public Water Works (S) Public Water Works (M) Public Water Works (L) Mixed Load / Bulk Supply Total

JVVNL 6,919 2,511 214 6,136 25 345 761 3,635 251 46 314 190 21,345

AVVNL 4,836 1,204 86 4,475 508 285 788 2,319 293 46 200 109 15,149

JdVVNL 4,572 1,193 145 10,793 243 252 646 1,183 272 110 541 417 20,367

Total 16,328 4,908 445 21,403 776 881 2,195 7,136 815 202 1,055 716 56,862

Commission’s Analysis Energy Sales for Metered Categories (except Agriculture Flat Rate Category ) 4.12 Considering the approach followed in order dated 20.02.2015, the Commission has considered the 5 year CAGR (from FY 2011-12 to FY 2016-17) for all categories (except Agriculture, large Industry and mixed load). 4.13 While computing the aforesaid 5 year CAGR, the Commission has considered the approved sale for FY 2016-17 as discussed in previous section and actual data of previous year. 4.14 Due to opting of open access by Large Industrial consumers, the 5 year CAGR for large Industrial category is reflecting slow pace of growth of less than 1%. Discoms have projected sales 7136 MUs for FY 2017-18 to this category as against actual sale of 7448 MUs for FY 2016-17. Therefore, for Large Industry category, the Commission has considered actual sales for FY 2016-17 for projecting the sales for FY 2017-18. 4.15 Due to shift of large number of consumers from mixed load category to non domestic category over the years, 5 year CAGR for mixed load Page 74 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

category is reflecting negative growth for three Discoms. Therefore, for mixed load category, the Commission has considered actual sales for FY 2016-17 for projecting the sales for FY 2017-18. 4.16 Further, in case of JdVVNL under Public Street light and public water works (M) category, the 3, 5 & 7 year CAGR is reflecting negative growth for three Discoms. Therefore, in the aforesaid categories, the Commission has considered actual sales for FY 2016-17 for projecting the sales for FY 2017-18. 4.17 The category wise growth rate and energy sales for FY 2017-18 (except flat agriculture) are as given in the tables below: Table 55: Growth Rate and Energy Sales for FY 2017-18 - JVVNL

Consumer Category

Sales Approved 3-Year in 2016CAGR 17

5-Year CAGR

Growth 7-Year Rate CAGR Adopted by Commission

Energy Sales (MU) approved

Domestic

4,803

8.49%

8.86%

8.82%

8.86%

5,228

Non-Domestic

2,130

10.63%

12.38%

13.13%

12.38%

2,393

Public Street Light

188

9.65%

11.28%

13.24%

11.28%

209

Small Industry

315

4.79%

3.35%

3.50%

3.35%

326

Medium Industry

727

0.24%

2.69%

4.12%

2.69%

747

3,929

4.11%

0.49%

3.46%

-

3,929

PWW (S)

241

7.34%

2.03%

2.22%

2.03%

246

PWW (M)

41

9.40%

9.94%

6.89%

9.94%

46

PWW (L)

304

15.04%

16.28%

14.99%

16.28%

353

Mixed Load

209

9.06%

-10.63%

-6.46%

-

209

Large Industry

Total

12887

13686

Table 56: Growth Rate and Energy Sales for FY 2017-18 - AVVNL Consumer Category

Sales Approved in 2016-17

3-Year CAGR

5-Year CAGR

Domestic

3,389

7.79%

9.90%

7-Year CAGR 11.23%

Growth Rate Adopted by Commission

Energy Sales (MU) approved

9.90%

3,724 Page 75 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Sales Approved in 2016-17

3-Year CAGR

5-Year CAGR

7-Year CAGR

Growth Rate Adopted by Commission

Energy Sales (MU) approved

1,088

10.06%

16.19%

15.19%

16.19%

1,264

Public Street Light

75

6.92%

7.22%

8.51%

7.22%

80

Small Industry

278

0.26%

2.40%

2.64%

2.40%

285

Medium Industry

781

4.84%

4.98%

5.87%

4.98%

820

2,390

-2.36%

-0.47%

3.05%

-

2,390

PWW (S)

283

7.97%

7.39%

6.21%

7.39%

304

PWW (M)

70

22.85%

14.94%

12.41%

14.94%

80

PWW (L)

201

7.17%

6.07%

7.47%

6.07%

214

Mixed Load

101

1.71%

-16.86%

-10.85%

-

101

Total

8656

Consumer Category Non-Domestic

Large Industry

9,262

Table 57: Growth Rate and Energy Sales for FY 2017-18 – JdVVNL Consumer Category

Sales Approved in 2016-17

3-Year CAGR

5-Year CAGR

7-Year CAGR

Growth Rate Adopted by Commission

Energy Sales (MU) approved

Domestic

3,270

8.76%

10.26%

11.14%

10.26%

3,606

Non-Domestic

1,068

8.44%

15.16%

14.38%

15.16%

1,230

Public Street Light

101

-18.32%

-3.09%

-0.86%

-

101

Small Industry

232

1.27%

1.63%

2.50%

1.63%

236

Medium Industry

607

1.54%

4.82%

6.88%

4.82%

637

1,129

1.60%

0.09%

3.05%

-

1,129

PWW (S)

264

4.79%

4.28%

2.18%

4.28%

275

PWW (M)

100

-1.12%

-0.24%

-0.67%

-

100

PWW (L)

459

8.86%

5.52%

5.12%

5.52%

485

Mixed Load

371

4.60%

-5.36%

-2.95%

-

371

Total

7602

Large Industry

8,170

Agriculture Metered (M) consumers

4.18 The Commission has accepted Discoms’ submissions in respect of number of existing consumers, new consumers and consumers to be converted from flat rate to metered category. 4.19 For projecting the sale to metered agriculture consumers connected Page 76 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

load and specific consumption as applicable for metered category have been considered for 6 months in case of new consumers and those converted from flat rate for working out their sales. 4.20 Accordingly, using the connected load, consumers and specific consumption as filed by Discoms the Commission worked out the sale to agriculture metered category for FY 2017-18 as follows: Table 58: Agriculture (M) sales for FY 2017-18-JVVNL Particulars Consumers Connected Total Specific Consumption (Nos.) Load per Connected consumption (Sales) MU consumer Load (kW) (kWh/kW/year) (kW) Existing consumers 4,66,930 6.12 28,55,457 2,030 5,795 Add: New Consumers 15,000 6.12 91,731 2,030 93 Add: converted from flat rate 10,000 7.60 76,044 2,030 77 Total 4,91,930 5,966 Table 59: Agriculture (M) sales for FY 2017-18- AVVNL Connected Consumption Total Specific Consumers Load per (Sales) MU Connect consumption Particulars consumer (Nos.) ed Load (kWh/kW/yea (kW) (kW) r) Existing consumers Add: New Consumers Add: converted from Total flat rate

3,88,409

6.54

25,38,719

1,621

4,115

7,500

6.54

49,022

1,621

40

15,000

11.52

1,72,792

1,621

140

4,10,909

Table 60: Agriculture (M) sales for FY 2017-18- JdVVNL Connected Total Specific Load per Particulars Consumers Connecte consumption (Nos.) consumer d Load (kWh/kW/year (kW) (kW) )

4,295

Consumption (Sales) MU

Page 77 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars

Existing consumers Add: New Consumers Add: converted from flat Totalrate

Consumers (Nos.)

Connected Load per consumer (kW)

2,93,528

Total Connecte d Load (kW)

Specific consumption (kWh/kW/year )

18.15

53,26,826

1,868

9,953

15,000

18.15

2,72,214

1,868

254

10,000

17.74

1,77,420

1,868

166

Consumption (Sales) MU

3,18,528

10,373

Energy Sales for Agriculture Flat Rate (FR) Consumers Connected Load per Consumer for Flat Rate Consumers.

&

Specific Consumption

4.21 The Commission has considered the connected load per consumer of 7.60 KW for JVVNL, 11.52 KW for AVVNL and 17.74 KW for JdVVNL as filed by Discoms. 4.22 Further, the Commission has observed that Discoms have filed the specific consumption for flat rate consumers as approved by Commission in the earl ier order which is accepted by the Commission for FY 2017-18. 4.23 However as mentioned above in metered category connected load of converted consumers have been considered for 6 months, Accordingly, using the connected load, specific consumption and consumers as filed by the Discoms, the sale to agriculture flat rate category have been worked out for FY 2017-18 as follows: Table 61: Agriculture (FR) Sales for FY 2017-18 – JVVNL Connected Total Specific Consumers Load per Connected consumption Particulars (Nos.) consumer Load (kW) (kWh/kW/year) (kW) Existing 11,694 7.60 88,925 1,945 consumers Less: converted 10,000 7.60 76,044 1,945 to meter

Consumption (Sales) MU

173 74 Page 78 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Total

1,694

99

Table 62: Agriculture (FR) Sales for FY 2017-18– AVVNL Connecte Total Specific Consumers d Load Connected consumption Particulars (Nos.) per Load (kW) (kWh/kW/yea consumer r) (kW) Existing consumers Less: converted to meter Total

Consumpti on (Sales) MU

37,691

11.52

4,34,179

1,945

844

15,000

11.52

1,72,792

1,945

168

22,691

676

Table 63: Agriculture (FR) Sales for FY 2017-18 – JdVVNL Connected Total Specific Consumers Load per Connected consumption (Nos.) consumer Particulars Load (kW) (kWh/kW/yea (kW) r) Existing consumers Less: converted to meter Total

Consumptio n (Sales) MU

17,034

17.74

3,02,218

1,945

588

10,000

17.74

1,77,420

1,945

173

7,034

415

Energy Sales as approved by the Commission for all categories 4.24 Based on the CAGR and actual sales approach as discussed in the preceding paragraphs and agriculture m etered & flat rate sales, as worked out on the basis of connected load and accepted specific consumption, the energy sales for Discoms are being approved as under: Table 64: Energy Sales approved by the Commission for FY 2017-18 (MU)

Particular Domestic Non-Domestic Public Street Light

JVVNL 5,228 2,393 209

AVVNL 3,724 1,264 80

JdVVNL 3,606 1,230 101

Total 12,558 4,887 390 Page 79 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Particular Agriculture (Metered) Agriculture (Flat) Small Industry Medium Industry Large Industry Public Water Works (S) Public Water Works (M) Public Water Works (L) Mixed Load / Bulk Supply Total

JVVNL 5,966 99 326 747 3,929 246 46 353 209 19,750

AVVNL 4,295 676 285 820 2,390 304 80 214 101 14,233

JdVVNL 10,373 415 236 637 1,129 275 100 485 371 18,958

Total 20,633 1,191 846 2,203 7,448 825 227 1,052 681 52,941

Transmission and Distribution losses Distribution Losses Petitioners’ Submission 4.25 The Discoms have submitted that they are focusing on loss reduction programs initiated in previous years and also increase use of the technology to target erring consumers and reduce the losses during the projection period. The investments being made under schemes like RAPDRP, FIP, SIP etc. are also expected to aid in the reduction of distribution loss especially in urban pockets. 4.26 Further, to achieve operational efficiency and bring around improvements, other steps like loss based load management, performance monitoring and management system, 100% feeder and DT metering, AMR metering for high value consumers, energy audit & accounting at feeder level, feeder segregation, etc. have already been initiated. 4.27 Considering the focus and all round efforts being made to reduce the AT&C losses, the commitments made under the UDAY scheme and the present available details, the distribution losses as proposed by the Discoms are provided in the table below and this includes technical as well as commercial losses other than those relating to collection efficiency: Table 65: Distribution Losses for FY 2017-18 – Petitioners’ Submission Particulars

FY 2017-18 Page 80 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

FY 2017-18

Particulars JVVNL AVVNL JdVVNL

20.00% 17.50% 16.50%

Commission’s Analysis 4.28 As discussed in order for FY 2016-17 in foregoing paras, the distribution losses as claimed by Discoms and approved by the Commission for FY 2017-18 are as under: Table 66: Distribution Losses for FY 2017-18 Name of Discoms JVVNL AVVNL JdVVNL

Losses Proposed by Discoms for FY 17-18 20.00% 17.50% 16.50%

Losses Approved by Commission for FY 17-18 18.50% 17.50% 16.50%

Collection Efficiency 4.29 As Discoms have projected 100% collection efficiency for FY 2017-18. The Commission accepts the submission of Discoms as adoption of lower collection efficiency will increase the revenue gap of Discoms which will indirectly burden the consumers of the State. Transmission Losses 4.30 The Discoms have filed the intra state and inter-state transmission loss of 4.11% and 3.15% respectively. 4.31 Whereas, the Commission has considered the intra state and inter-state transmission loss of 3.89% and 3.15% based on the RVPN Tariff Order dated 26.05.2017 being actual transmission losses achieved during FY 2015-16 and average of weekly losses for the grid submitted by the Discoms respectively. 4.32 The levels of transmission losses as proposed by the Discoms and considered by the Commission for FY 2017-18 have been shown in the following table: Table 67: Levels of Transmission Loss (%) Particulars

Proposed for FY 2017-18

Approved by Commission for FY 2017-18 Page 81 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars

Proposed for FY 2017-18

Approved by Commission for FY 2017-18

4.11% 3.15%

3.89% 3.15%

Intra-State Transmission Losses Inter-State Transmission Losses

Energy Requirement as approved vis-à-vis Petitioners’ submission 4.33 On the basis of the sales and distribution & transmission losses discussed above, the energy requirement proposed by Discoms and approved by the Commission for FY 2017-18 is given in the following table: Table 68: Energy Requirement for FY 2017-18 (MU) JVVNL Particulars Energy Sales to Consumers (MU) Distribution Loss (%) Add: Distribution Loss (MU) Energy Required at Discoms periphery (MUs) Intra-State Transmission Losses (%) Add: Intra-State Transmission Losses (MU) Energy Requirement at Transco periphery Inter-State Transmission Losses (%) Add: InterStates Transmission Loss Gross Energy Requirement (MU)

AVVNL

Propos ed

Approv ed

21,345

19,750

20.00%

18.50%

Propos ed

15,149 17.50%

JdVVNL

Approv ed

14,233 17.50%

Propos ed

20,367 16.50%

Total

Approv ed

Propos ed

Approv ed

18,958

56,862

52,941

16.50%

5,336

4,483

3,213

3,019

4,025

3,746

12,574

11,248

26,682

24,233

18,363

17,252

24,392

22,704

69,436

64,190

4.11%

3.89%

4.11%

3.89%

4.11%

3.89%

1310

981

915

698

1065

919

3291

2598

27992

25214

19278

17951

25457

23623

72727

66788

3.15%

3.15%

3.15%

3.15%

3.15%

3.15%

305

296

213

207

244

237

762

741

28297

25511

19491

18158

25701

23860

73489

67529

Power Purchase Cost Page 82 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Petitioners’ Submission 4.34 Discoms have projected energy availability for FY 2017-18 on the basis of estimated generation from existing stations and projected generation from new stations. For existing stations, the Discoms submitted that the power purchase quantum has been considered as per the actual energy received in previous years. The Discoms analyzed the existing power scenario and the power purchase has been accordingly projected considering the energy requirement and the merit order principles. The power purchase from stations which were commissioned in FY 2015-16 and were only available for part of the year has been computed based on capacity, PLF and Auxiliary consumption. 4.35 Discoms have submitted that they have made the following assumptions while projecting the power purchase cost for FY 2017-18: ·

For Coal, Gas and Hydro based Power Plants, an escalation rate in the range of 2% to15 %is considered over the per unit actual cost for FY 2015-16.

·

For Nuclear Power Plants, a nominal escalation rate of 2 % has been considered over average per unit tariff from nuclear sources as per DAE reply to Lok Sabha query dated 09.03.2016.

·

The fixed charges and variable charges for the plants which are going to be commissioned in FY 2017-18 have been assumed on the basis of similar types of plant.

·

The availability from RFF has been wholly allocated to JVVNL.

·

The purchase from renewable energy sources has been projected as per the RPO Obligation approved by the Commission.

4.36 Summary of the power purchase quantum and cost as submitted by Discoms in their petitions are as under: Table 69: Power Purchase (MU) and Cost (Rs. Cr.) for FY 2017-18 – submitted by Discoms Energy Availability (Mus) and Cost for FY 2017-18- Submission JVVNL AVVNL JdVVNL Total Stations Units Cost Units Cost Units Cost Units Cost NTPC 2377 727 1664 509 1902 581 5943 1816 NHPC 777 254 544 178 622 203 1943 635 Page 83 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Energy Availability (Mus) and Cost for FY 2017-18- Submission JVVNL AVVNL JdVVNL Stations Units Cost Units Cost Units Cost RVUN 9132 3683 6392 2578 7305 2946 Rajwest 3065 1238 2146 867 2452 991 GLTPP 237 57 166 40 189 46 NPCIL 1227 358 859 250 982 286 SHARE PROJECTS 1372 48 960 33 1097 38 TEHRI 96 56 67 39 77 45 KOTESHWAR 73 23 51 16 58 18 Tala 19 4 13 3 15 3 SJVVN and Rampur 286 90 200 63 229 72 Neyveli Lignite 710 209 497 146 568 167 Aravali Power 3 3 2 2 3 2 Coastal Gujarat 1004 243 703 170 803 195 Adani Power Rajasthan Ltd. 3297 1190 2308 833 2638 952 Sasan Power Ltd. 1161 194 813 136 929 155 Karcham Wangtoo 177 60 124 42 142 48 NVVN Bundled 891 388 624 272 713 310 NCES 3316 1597 2277 1097 3075 1481 CPP's 11 2 7 1 8 2 New Stations 2946 1407 2062 985 2357 1125 Total 32178 11828 22481 8259 26165 9666 Sale/purchase of surplus/(deficit) energy 3881 970 2990 747 464 116 Net power purchase cost

28297

10858

19491

7511

25701

9550

Total Units Cost 22829 9207 7663 3095 591 143 3068 894 3429 119 241 139 182 56 48 10 715 224 1774 522 8 7 2510 608 8243 2975 2903 484 443 151 2228 970 8668 4175 26 5 7365 3516 80823 29753 7335

1834

73489 27920

Commission’s Analysis 4.37 While estimating energy availability and power purchase cost for F Y 2017-18, the Commission has considered the actual data of generation of twelve months from State and Central generating units as submitted by the Discoms of FY 2016-17 for projection for FY 2017-18. Likewise, the position as per latest tariff orders order/interim order as well as the actual variable cost of FY 2016-17 has been escalated in working out power purchase cost for FY 2017-18, as discussed later in the order. 4.38 For estimating the power purchase cost, the Commission has considered availability from various sources for the State as a whole. For working out Discom wise availability and cost, the allocation of power to Page 84 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

JVVNL, AVVNL and JdVVNL from all generating stations has been considered in the ratio of 40%, 28% and 32% respectively, except that 100% allocation of RFF share has been considered for JVVNL . Energy Availability and Cost for FY 2017-18 RVUN Stations 4.39 For RVUN generating stations, including KTPS (Unit 1-7) & DCCPP, RGTPS(Stage I, II& III), Mahi, MMH, Chhabra Kalisindh(Unit 1&2), the Commission has considered availability for FY 2017-18 as per actual purchase from March 2017.

STPS(Unit 1-6), (Unit 1-4) & the energy April 2016 to

4.40 The fixed and energy charges for the aforesaid RVUN plants are as per RVUN Tariff order dated 20.06.2017 for FY 2017-18 and applicable regulations. 4.41 Tariff of Mini-Micro (MMH) plants have been considered Regulation 58 of RERC Tariff Regulations, 2014.

as per

4.42 The energy availability and cost from RVUN’s generating stations as considered by the Commission have been shown in the table below: Table 70: Energy Availability (MU) and Cost (Rs. Cr.)- RVUN Stations for FY 2017-18 Station Energy Availability Cost KTPS(1 to 7)

6628

2410

STPS(1 to 6)

4023

1876

DCCPP

95

41

RGTP(1&2)

432

107

RGTP 3

936

424

MAHI MMH Chabbra – 1&2

209 9

52 3

3059

1184

Chabbra – 3

1515

624

Chabbra – 4

1559

607

Kalisindh unit 1

3415

1578

Kalisindh unit 2

2116 23996

934 9840

Total

Page 85 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Lignite based projects 4.43 The lignite based projects include Giral Lignite Power Limited, Rajwest Limited and Neyveli Lignite Corporation Limited. For Giral unit 1 & 2, Commission has not considered any generation for FY 2017-18 as the plant is not functioning for a long period. The availability for Rajwest and Neyveli for FY 2017-18 has been considered as per actual purchase of FY 2016-17. 4.44 The per unit charge for FY 2017-18 for Rajwest have been considered as per the Commission’s interim order dated 27.04.2017. 4.45 The fixed charges of Neyveli project for FY 2017-18 has been considered as per actual charges for FY 2016-17 and variable charges of FY 2016-17 have been escalated by 2% for FY 2017-18. 4.46 The energy availability and total power purchase cost for Lignite based projects have been summarized in the table below: Table 71: Energy Availability (MU) and Cost (Rs. Cr.)- Lignite Plants for FY 2017-18 Energy Availability Total Cost Station Giral –1&2

0

0

Rajwest

5826

2338

Neyveli Lignite

1271 7097

510 2848

Total

Nuclear Power Corporation of India Ltd. (NPCIL) 4.47 For NPCIL, the Commission has considered the actual purchase of FY 2016-17. The charges per unit as approved above of FY 2016-17 have been escalated by 2% for FY 2017-18. 4.48 The energy availability and total power purchase cost for NPCIL plants have been summarized in the table below: Table 72: Energy Availability (MU) and Cost (Rs. Cr.)- NPCIL for FY 2017-18 Energy Availability Total Cost Station NPCIL

2791

844

Page 86 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Partnership Projects (PP) and RFF 4.49 For partnership projects and RFF, the Commission has considered the actual purchase of FY 2016-17. The variable charge per unit as approved above of FY 2016-17 have been escalated by 2% for FY 201718. 4.50 Energy availability and total power purchase cost for partnership projects and RFF have been summarized in the table below: Table 73: Energy Availability (MU) and Cost (Rs. Cr.)- Partnership Projects for FY 2017-18 Energy Availability Total Cost Station Partnership Project

2915

105

RFF

122

50

NTPC, NHPC & Others 4.51 The energy availability and fixed charges for NTPC & NHPC and other plants have been considered as per actual purchase for FY 2016-17 and variable charges of FY 2016-17 have been escalated by 2% for FY 2017-18. 4.52 The cost per unit of Bhadla-II (New PPA) of FY 2016-17 has been kept at same level for FY 2017-18 4.53 The energy availability and total power purchase cost for NTPC, NHPC and other plants have been summarized in the table below: Table 74: Energy Availability (MU) and Cost (Rs. Cr.)- NTPC & NHPC and Other Generating Stations for FY 2017-18 Energy Availability Total Cost Plants NTPC Stations

5893

1804

NHPC Stations

1698

622

17171

5814

245

127

106

42

49 25162

10 8419

Rampur+Aravali+ Adani+ Sasan+ SJVVNL+NVVN+coastal Guj.+Wangtoo+other Tehri Hydro Koteshwar Tala Total

Page 87 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Non-Conventional Energy Sources 4.54 The Commission has taken the availability from non-conventional energy sources to the extent of RPO requirement i.e., 8.20% for wind, 1.30% for Bio-mass and 4.75% for Solar. 4.55 Vide notification dated the 07.06.2017, to be effective from 1.04.2017, the Commission amended the “Rajasthan Electricity Regulatory Commission (Renewable Energy Certificate and Renewable Purchase Obligation Compliance Framework) (Second Amendment) Regulations, 2017.” wherein the Commission stated as under: Amendments in Regulation 3 of the Principal Regulations: The following proviso shall be added below the existing Regulation 3(g) of the Principal Regulations: “Provided that for the years 2017-18 and 2018-19, the consumption of the obligated entity as defined above shall exclude the consumption met from hydro sources of power.” 4.56 Accordingly, the availability has been considered as per aforesaid RPO Regulations and per unit cost has been considered as per actual of FY 2016-17. Table 75: Energy Availability (MU) and Cost (Rs. Cr.)- Wind, Solar & Biomass for FY 2017-18 Energy Availability Total Cost Plants

Wind farms

5016

2497

Solar

2906

1341

Biomass

795 8717

528 4366

Total

Short term Sources 4.57 After considering the energy available to Discoms based on their respective allocated shares, the Commission has estimated a surplus in JVVNL & AVVNL and deficit in JdVVNL in energy availability. 4.58 Commission has considered sale and purchase the short term power at Rs. 4 per unit as discussed above in FY 2016-17 order. 4.59 It has also been observed that while the two Discoms are having surplus while the other Discom is having shortage. This is due to allocation of power in certain ratio to respective Discom. The Discoms may take up Page 88 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

the matter with Government for suitable amendment in existing allocation ratio as per requirement. Total Power Purchase Cost 4.60 Based on the above, the summary of source wise and Discom wise breakup of power purchase quantum and cost for FY 2017-18 as considered by the Commission for the three Discoms is given in the table below: Table 76: Energy Availability (MU) and Cost (Rs. Cr.) for FY 2017-18 Stations

JVVNL Units

NTPC NHPC NPCIL Tehri+Koteshwar+Tala RVUN/ State Generation Shared Projects RFF NCES SJVN and Rampur New Stations Aravali+ Adani+ Sasan+ Neyveli+coastal Guj.+Wangtoo NVVN Bundled TOTAL Less/add: Short Term Net power Purchase

AVVNL Cost

Units

Cost

JdVVNL Units

Cost

Total Units Cost

2357 679 1116 160 11929 1166 122 3487 285 260

722 249 338 71 4871 42 50 1746 90 107

1650 475 781 112 8350 816 2441 199 182

505 174 236 50 3410 30 1223 63 75

1886 543 893 128 9543 933 2790 228 208

577 199 270 57 3897 34 1397 72 86

5893 1698 2791 400 29823 2915 122 8717 712 649

1804 622 844 178 12178 105 50 4366 224 268

5871 962 28394 -2883 25511

1886 447 10619 -1153 9466

4109 674 19790 -1632 18158

1320 313 7399 -653 6746

4696 770 22617 1243 23860

1509 358 8456 497 8953

14676 2406 70801 -3273 67529

4715 1118 26473 -1309 25164

Transmission Charges Petitioners ‘Submission 4.61 For estimation of the RVPN transmission charges and SLDC charges for FY 2017-18, the escalation rate in the range of 5%-15% is considered over the actual cost of FY 2015-16. Further, for estimating the PGCIL charges, the Discoms have considered an escalation rate of 5%-6% over the PGCIL transmission charges as payable during FY 2015-16. 4.62 The details of the transmission and SLDC charges submitted by Discoms have been summarized in the table below: Page 89 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 77: Transmission Charges & SLDC Charges for 2017-18 (Rs. Crore)

Particulars PGCIL Charges RVPN Charges RLDC Charges SLDC Charges Total Transmission Charges

JVVNL 603 1053 2 8 1665

AVVNL 422 737 1 6 1166

JdVVNL 482 842 1 7 1332

Total 1507 2632 4 21 4163

Commission’s Analysis 4.63 The Commission has considered the RVPN and SLDC charges for FY 2017-18 as per the RVPN tariff order dated 26.05.2017 for FY 2017-18. 4.64 The Commission has considered the other transmission, PGCIL and RLDC charges as proposed by Discoms for FY 2017-18. 4.65 The transmission & SLDC charges accordingly approved by the Commission for FY 2017-18 are as under: Table 78: Transmission Charges approved by the Commission for FY 2017-18 (Rs. Crore) JVVNL AVVNL JdVVNL Total Particulars PGCIL Charges

603

422

482

1507

RVPN and Other Charges

820

574

656

2051

2

1

1

4

3 1428

2 999

2 1142

7 3569

RLDC Charges SLDC Charges Total Transmission Charges

Operation and maintenance Expenses Petitioners’ Submission 4.66 Discoms have estimated O&M expenses based on the O&M norms specified in RERC Tariff Regulations, 2014. 4.67 The O&M expenses projected by Discoms for FY 2017-18 have been summarized below: Table 79: Operation and Maintenance Expenses for FY 2017-18 (Rs. Crore) Particulars

JVVNL

AVVNL

JdVVNL

Employee Costs

962

683

918

Administrative & General Costs

101

72

79

Repairs & Maintenance Costs

203

144

157

1266

898

1154

Total O&M Costs

Total 2563 252 504 3318 Page 90 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars Less: Expenses to be Capitalized Net O&M Costs charged to revenue

JVVNL

AVVNL

JdVVNL

333

17

172

933

881

982

Total 522 2796

Commission’s Analysis 4.68 Commission has allowed O&M expenses Regulation 83 of RERC Tariff Regulations, 2014.

in

accordance

with

4.69 As per regulation 24(3), the Commission has escalated the normative O&M expenses based on per unit sale of FY 2016-17 at the rate of 5.85% per annum for FY 2017-18. 4.70 Commission has considered the sales allowed for FY 2017-18 for projecting normative O&M expenses. Capitalized O&M expenses have been considered in the same ratio as projected by Discoms. 4.71 O&M expenses approved by the Commission for Discoms for FY 2017-18 have been summarized below: Table 80: Operation and Maintenance Expenses approved for FY 2017-18 (Rs. Crore) Particulars JVVNL AVVNL JdVVNL Total Employee Costs

890

641

854

2386

Administrative & General Costs

94

68

90

251

Repairs & Maintenance Costs

187

135

180

502

1171

844

1124

3139

Expenses to be Capitalized

308

16

167

492

Net O&M Costs charged to revenue

863

828

957

2647

Total O&M Costs

Terminal Benefit Expenses Petitioners’ Submission 4.72 T h e Discoms have considered the terminal benefits for FY 2017-18 as per the liability assessed in the actuarial valuation for the FY 2015-16. 4.73 The te rm i n al benefit liability submitted by the Discoms for FY 2017-18 has been tabulated below:

Page 91 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 81: Terminal Benefit Expenses for FY 2017-18 (Rs. crore) Particulars JVVNL AVVNL Terminal Benefit Expenses

700

JdVVNL

569

Total

298

1567

Commission’s Analysis 4.74 The Commission has considered terminal benefit expenses for FY 2017-18 as submitted by Discoms. However, the Commission shall allow the payment made towards actuarial valuation liability in the true up of FY 2017-18 only to the extent of funds actually transferred to the designated Fund. Capitalization Petitioners’ Submission 4.75 The capital investment and capitalization proposed by Discoms are shown in the table below: Table 82: Capital Expenditure and Capitalization proposed for FY 2017-18 (Rs. crores)

Particulars Capital Expenditure

JVVNL

Capitalization

AVVNL

JdVVNL

1793

1405

2040

1905

1591

2000*

* Before assets not in use as per form 3.6 of the petition

Commission’s Analysis 4.76 Following the methodology adopted in 22.09.2016 order for FY 201516, the Commission has considered 80% of the proposed capitalization in this ARR order as under. Table 83: Projected Capitalization approved by the Commission for FY 2017-18 (Rs. Crore)

Particulars Capitalization

JVVNL

AVVNL

1524

1272

JdVVNL 1600

Interest on Loans and Finance Charges & Lease rental Petitioners’ Submission 4.77 To compute the interest on loan, Discoms have considered opening normative loan as on 1st April 2016 equivalent to closing balance of Page 92 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

long term loans for FY 2015-16 as per audited accounts for the year. Further, capitalisation during the year after deducting consumer contribution, normative equity @30% of the remaining capitalisation and the balance amount has been considered as addition to long term loans during the year. The loan repayment has been considered in accordance with Regulation 21 of the RERC Tariff Regulations 2014 which caps deemed repayments to the extent of depreciation charged for the year. The closing normative loan is considered after aforesaid addition to loan and deducting normative repayment for FY 2016-17. 4.78 On the similar line the additional capitalization and repayment during FY 2017-18 have been considered to arrive at closing figure of FY 2017-18. 4.79 The interest on long term loans is estimated on the basis of actual weighted average interest rate for long term loans and applied on the average of normative loans (average of opening and closing normative loan). 4.80 The interest on security deposit and finance charges for FY 2017-18 have been projected as explained in above ARR order For FY 2016-17. 4.81 The Discoms have kept the unfunded gap and interest thereon at the same level as claimed in FY 2016-17 i.e. upto FY 2015-16. 4.82 The interest charges and finance charges 2017-18 have been summarized in the table below:

for

FY

Table 84: Interest and Financing Charges for FY 2017-18 (Rs. Crore) Description

JVVNL 5265

AVVNL 4908

JdVVNL 4876

Capitalisation

1905

1591

2000

5496

Capital expenditure financed by Equity

491

394

420

1306

Capital expenditure financed by Consumer Contribution and grants

268

277

599

1144

Receipt of LTL for Capital expenditure

1146

920

981

3046

Principal Repayment

878

601

614

2093

Closing balance of LTL

5533

5227

5242

16002

Average LTL

5399

5068

5059

15525

Opening balance of LTL

Total 15048

Page 93 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Description Average Interest rate of LTL (%)

JVVNL 12.40%

AVVNL 12.91%

JdVVNL 13.03%

Total

Interest Charges on LTL

669

654

659

1983

Interest on Security Deposit

88

64

57

208

Finance Charges & Lease Rental

103

101

309

513

Gross Interest Charges

860

819

1026

2704

Interest Expenses Capitalized

149

96

33

278

Total Interest & Financing Charges

711

722

993

2426

13185

11646

12761

37592

12.40%

12.91%

13.03%

Interest liability on unfunded gap

1635

1504

1663

4801

Total Interest & Financing Charges

2346

2226

2656

7227

Unfunded Gap upto FY 16 Average ROI

Commission’s Analysis 4.83 Interest on term loan and finance charges have been computed as per methodology explained in above order for FY 2016-17. 4.84 Based on the above, the approved interest and finance charges approved for FY 2017-18 for the three Discoms have been summarized in the tables below: Table 85: Interest and Finance Charges approved by the Commission for FY 2017-18 (Rs. Crore)

Particulars Opening balance of LTL (A)

JVVNL

AVVNL

JdVVNL

Total

5997

3578

3319

12894

Capitalization (B)

1524

1272

1600

4396

Capital expenditure financed by Equity (C)

393

315

336

1044

Capital expenditure financed by Consumer Contribution and grants (D)

214

222

479

915

Receipt of LTL for Capital expenditure E=(BC-D) Principal Repayment(F)

917

736

785

2437

697

457

431

1584

Closing balance of LTL, G=(A+E-F)

6217

3857

3673

13747

Average LTL, H=(A+G)/2 Average Interest rate of LTL (%)(I)

6107

3718

3496

13321

8.88%

9.01%

9.54%

Interest Charges on LTL, J=(HXI)

542

335

334

1210

Interest on Security Deposit (K)

88

64

57

208

Page 94 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars Finance Charges & Lease Rental (L)

JVVNL 103

AVVNL 101

JdVVNL 98

Total 302

Gross Interest Charges, M=(J+K+L)

732

499

489

1720

Interest Expenses Capitalized (N)

127

59

16

201

Total Interest & Financing Charges (O)

605

440

473

1519

14410

12742

13966

41118

1279

1147

1332

3759

1885

1588

1806

5278

unfunded Gap upto FY 2016-17 (P) Interest on Carry Forward Revenue Gap, Q=(PXI) Total Interest & Financing Charges after interest on carry forward Gap (O+Q)

Interest on Working Capital Petitioners’ Submission 4.85 Discoms estimated their working capital requirement for FY 2017-18 as per Regulation 27 of the RERC Tariff Regulations, 2014 and the same has been tabulated below: Table 86: Interest on Working Capital for FY 2017-18 (Rs. Crore) Descriptions JVVNL AVVNL O&M expenses (as per norms) 78 73

JdVVNL 82

Total 233

Maintenance Spare (as per norms)

140

132

192

464

Receivables (as per norms)

2247

1624

1902

5774

1129 1335

820 1010

740 1436

2689

11.80% 158

11.80% 119

11.80% 169

Less: Security deposit of Consumers Total Working Capital Interest Rate (%) Interest on Working Capital

3781 446

4.86 The Petitioner has further submitted that it has considered the latest base rate of State Bank of India of FY 2017-18 plus 250 basis points Commission’s Analysis 4.87 The normative working capital requirement along with interest thereon has been calculated as per regulation 27 of RERC Tariff Regulations, 2014. 4.88 Accordingly, the interest on working capital considered by the Page 95 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Commission is as under: Table 87: Interest on Working Capital approved by the Commission for FY 2017-18 (Rs. Crore)

Description

JVVNL

AVVNL

JdVVNL

Total

O&M expenses (as per norms)

72

69

80

221

Maintenance Spare (as per norms)

129

124

144

397

Receivables (as per norms)

1827

1305

1652

4784

Security deposit of Consumers

1129

820

740

2689

Total Working Capital

899

678

1135

2712

11.80% 106

11.80% 80

11.80% 134

320

Less:

Interest Rate (%) Interest on Working Capital

Depreciation Petitioners’ Submission 4.89 The Discoms have submitted that for computation of depreciation they have considered the specified rates as provided in the RERC Tariff Regulations, 2014 in Appendix-I based on Straight Line Method (SLM) 4.90 The submission of the three Discoms with respect to depreciation has been tabulated below: Table 88: Depreciation for FY 2017-18 (Rs. crore) Particulars Depreciation

JVVNL 878

AVVNL 601

JdVVNL 614

Total 2093

Commission’s Analysis 4.91 Commission has considered depreciation based on methodology explained earlier in the order for FY 2016-17

the

same

4.92 Accordingly, depreciation allowed by the Commission for each of the three Discoms has been tabulated below: Table 89: Depreciation allowed by the Commission for FY 2017-18 (Rs. Crore) Particulars JVVNL AVVNL JdVVNL Depreciable Assets at the beginning of the Year (A) Capitalization during the year (B)

Total

13445

9374

8812

31631

1524

1272

1600

4396

Page 96 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars less: Consumer Contribution and Capital Grants during the year (C) Depreciable Assets added during the Year D=(B-C) Depreciable Assets at the end of the Year (E= (A+D)) Average Depreciable Assets during the Year (F=(A+E)/2) Average Depreciation Rate (G) Depreciation (FXG)

JVVNL

AVVNL

JdVVNL

Total

214

222

479

915

1310

1051

1121

3482

14754

10425

9933

35112

14099

9899

9373

33371

4.94%

4.61%

4.60%

697

457

431

1584

Insurance Expenses Petitioners’ Submission 4.93 Discoms have estimated the Insurance expenses for FY 2017-18 on the basis of net fixed assets subject to the ceiling specified in Regulation 25 of the RERC Tariff Regulations, 2014. Table 90: Insurance Expenses- Discoms submission for FY 2017-18 (Rs. in Crore) Particulars Insurance charges

JVVNL

AVVNL

26

19

JdVVNL 20

Total 64

Commission’s Analysis 4.94 Commission has allowed Insurance expenses in accordance with Regulation 25 of RERC Tariff Regulations, 2014 as explained earlier in this Order. Table 91: Insurance Expenses Approved for FY 2017-18 (Rs. in Crore) JVVNL AVVNL JdVVNL Particulars Insurance charges

25

18

19

Total 62

Return on Equity Petitioners’ Submission 4.95 Discoms have not claimed return on equity for FY 2017-18. Commission’s Observation Page 97 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

4.96 As Discoms have not sought Return on Equity, the Commission has also not considered Return on Equity. Interest on Delayed Payment Surcharge Petitioners’ Submission 4.97 Discoms in their petition for FY 2017-18 have claimed the interest on principle amount of Delayed Payment Surcharge (DPS) stating that the consideration of DPS from books of accounts adversely affects the revenue gap of the Discoms. If the accrued DPS is considered to form part of Non Tariff Income, the financing cost for corresponding receivables must also be considered. Commission’s Observation 4.98 As discussed in ARR section of FY 2016, the Commission direct the Discoms to take up this matter while filing the petition for true-up for FY 2017-18 wherein Discoms should furnished detailed calculations corroborating their claim based on actual/audited data. Non-Tariff Income and Wheeling Charges Petitioners’ Submission 4.99 Discoms have projected Non-Tariff Income for FY 2017-18 using the escalation of 5% per annum on the figures of FY 2015-16. No increase has been considered for projecting income from wheeling and reactive energy charges for FY 2017-18. Further, income from cross subsidy surcharge and additional surcharge have also been projected for FY 2017-18 based on the rates approved by the Commission and the projections made for energy drawl through open access as given below: Table 92: Non-Tariff Income for FY 2017-18 (Rs. Crore) Particulars JVVNL Non-Tariff Income Income from Wheeling Charges, Cross Subsidy Surcharge and Additional Surcharge Total

AVVNL

JdVVNL

Total

333

260

406

998

224 557

585 844

115 521

924 1922

Page 98 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Commission’s Analysis 4.100 The Commission has considered the non-tariff income and wheeling charges for FY 2017-18 as projected by Discoms. Aggregate Revenue Requirement Petitioners’ Submission 4.101 The Annual Revenue Requirement for FY 2017-18 proposed by the three Discoms has been given in the table below: Table 93: Summary of ARR for FY 2017-18 – Discoms’ submission (Rs. Crore) Sr. No.

1 2

3 4 5 6 6 7 8 9 10 11 12

Particulars

JVVNL

Power Purchase Cost* Transmission Charges PGCIL RVPN SLDC Operation & Maintenance Expenses Terminal Benefit Interest and Finance Charges Interest on unfunded gap Interest on working Capital Depreciation Insurance charges Aggregate Revenue Requirement Less: Non-Tariff Income Less: Cross Subsidy and Additional Surcharge Net Aggregate Revenue Requirement

10858 0 603 1053 10 933 700 711 1635 158 878 26 17563 333 224 17007

AVVNL JdVVNL Submission FY 2017-18 7511 9550 0 0 422 482 737 842 7 8 881 982 569 298 722 993 1504 1663 119 169 601 614 19 20 13091 15623 260 406 585 115 12246 15102

Total

27920 0 1507 2632 25 2796 1567 2426 4801 446 2093 64 46277 998 924 44355

*

*Power purchase cost has been considered after adjustment of sale of surplus power

Commission’s Approval 4.102 Commission has approved the ARR for FY 2017-18 based on the items of expenditure discussed in the preceding sections and the same has been summarized in the table below:

Page 99 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Table 94: Summary of ARR for all the three Discoms for FY 2017-18 – Approved by Commission (Rs. Crore)

Sr. No.

1 2

3 4 5 6 6 7 8 9 10 11 12

Particulars

JVVNL

Power Purchase Cost* Transmission Charges PGCIL RVPN SLDC Operation & Maintenance Expenses Terminal Benefit Interest and Finance Charges Interest on unfunded gap Interest on working Capital Depreciation Insurance charges Aggregate Revenue Requirement Less: Non-Tariff Income Less: Cross Subsidy and Additional Surcharge Net Aggregate Revenue Requirement

9466

AVVNL JdVVNL Approved FY 2017-18 6746 8953

25164

603 820 4 863 700 605 1279 106 697 25 15169 333 224 14612

422 574 3 828 569 440 1147 80 457 18 11284 260 585 10439

1507 2051 11 2647 1567 1519 3759 320 1584 62 40191 998 924 38269

482 656 3 957 298 473 1332 134 431 19 13739 406 115 13218

Total

*Power purchase cost has been considered after adjustment of sale of surplus power

Revenue and Revenue Deficit based on Existing Tariff Revenue on Existing Tariff Petitioners’ Submission 4.103 Discoms have projected the revenue based on energy sales forecasts for the period and the applicable retail tariff as per the RERC’s Tariff Order for FY 2015-16 dated 22nd September 2016 4.104 The revenue in FY 2017-18 from existing tariff as per Discoms’ submission is as under: Table 95: Revenue from existing tariff for FY 2017-18– Discoms’ submission (Rs. Crore)

JVVNL Particular Domestic Service Non-Domestic Service Public Street Light Agriculture Metered Supply Agriculture Flat Rate Supply Small Industrial Service Medium Industrial Service

4,736 2,410 149 3,071 14 245 596

AVVNL JdVVNL Submission FY 2017-18 3,341 3,118 1,145 1,103 59 98 2,250 5,239 274 130 217 185 643 531

Total

11,195 4,659 305 10,561 418 647 1,770

Page 100 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

JVVNL Particular Large Industrial Service P.W.W. & S. Pumping –Small P.W.W. & S. Pumping –Medium P.W.W. & S. Pumping –Large Mixed Load / Bulk Supply Total

2,939 166 34 238 145 14,744

AVVNL JdVVNL Submission FY 2017-18 2,029 1,167 199 177 35 83 158 438 89 309 10,440 12,578

Total

6,136 542 152 833 543 37,762

Interest subvention, Electricity Duty and Subsidy 4.105 Discoms have shown Differential Interest Subvention on World Bank Loan, Subvention from State Govt against electricity duty, Subsidy against compounding charges for FY 2017-18 as under: Table 96: Interest subvention, electricity duty and subsidy for FY 2017-18 (Rs. Crore) JVVNL Particular Differential Interest Subvention on World Bank Loan Subvention from State Govt. against ED Subsidy against compounding charges Total Subsidy Amount

3 664 17 684

AVVNL JdVVNL Submission FY 2017-18 3 2 410 410 6 10 419 422

Total

8 1484 33 1525

Revenue Deficit 4.106 The revenue deficits submitted by Discoms for FY 2017-18 at the existing tariff have been provided in the table below:Table 97: Revenue Deficit at existing tariff for FY 2017-18 (Rs. Crore) Particulars

Net Aggregate Revenue Requirement (A) Revenue from Existing tariff (B) Total of interest on subvention, ED and Subsidy (C) Deficit including Carrying cost D= (A-B-C)

JVVNL

Revenue Deficit of last year E Carrying cost on revenue deficit F

17,007 14,744 684 1,579 2,618 423

Gap after last year Losses claimed By Discoms (D+F)

4,619

AVVNL JdVVNL Submission FY 2017-18 12,246 15,102 10,440 12,578 419 422 1,387 2,102 2,151 2,891 367 514 3,905

5,507

Total

44,355 37,762 1,525 5,068 7660 1303 14032

Commission’s Analysis: 4.107 Commission has calculated the revenue from existing tariff on the Page 101 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

basis of consumer category wise energy sales approved by the Commission in this order for FY 2017-18 based on retail tariff notified on dated 22.09.2016. The estimated revenue at existing tariff for different consumer categories for all the three Discoms for FY 2017-18 has been summarized in the table below: Table 98: Revenue from Existing Tariff for FY 2017-18- Approved by the Commission (Rs. Crore) JVVNL AVVNL JdVVNL Total Approved Particular FY 2017-18 Domestic Service 3649 2676 2524 8,848 Non-Domestic Service 2276 1186 1127 4,589 Public Street Light 156 63 76 295 Agriculture Metered Supply 2988 2163 5083 10,234 Agriculture Flat Rate Supply 54 365 224 643 Small Industrial Service 232 217 176 626 Medium Industrial Service 583 658 519 1,761 Large Industrial Service 3111 2031 1083 6,224 P.W.W. & S. Pumping –Small 163 206 179 548 P.W.W. & S. Pumping –Medium 34 59 76 169 P.W.W. & S. Pumping –Large 265 166 390 821 Mixed Load / Bulk Supply 159 83 276 518 Total 13,671 9,872 11,733 35,276

ARR and Revenue 4.108 Considering the ARR and Revenue at existing tariff as determined by the Commission and subsidy & subvention as shown by Discoms in their petition, the revenue gap for all the three Discoms for FY 2017-18 at the existing tariff has been worked out. Table 99: Revenue Deficit at existing tariff for FY 2017-18 – Approved by the Commission (Rs. Crore)

Particulars

Net Aggregate Revenue Requirement (A) Revenue from Existing tariff (B) Total of interest on subvention, ED and Subsidy (C) Deficit including Carrying cost D= (A-B-C) Add: Consumer Education Net Deficit including Carrying cost

JVVNL

14,612 13,671 684 257 0.50 258

AVVNL JdVVNL Approved FY 2017-18 10,439 13,218 9,872 11,733 419 422 149 1,063 0.50 0.50 149 1063

Total

38,269 35,276 1,525 1,468 1.50 1470

Page 102 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Section-5 : Tariff Proposal and approved Tariff 5. Tariff proposal for FY 2016-17 and FY 2017-18 5.1

Discoms have not made proposal for revision in tariff which has been accepted, accordingly, the tariff determined vide order 22.09.2016 shall continue to prevail during FY 2016-17 and FY 2017-18. The category wise tariff is enclosed at annexure D.

5.2

Discoms have made certain rationalization measures in order to facilitate better utilization of resources, economic pricing and better revenue management which have been dealt below: Load Factor Rebate

5.3

Discoms have proposed a rebate of Rs 0.15 per unit on energy charges for consumers maintaining Load Factor of 50% and above during the billing period. They have submitted that this would ensure system stability and forecasting of power requirement become more accurate. Discom also clarified that this rebate would only be applicable on the energy consumption over a load factor of above 50% for Large Industrial Consumer Category. Commission’s view

5.4

In light of higher energy availability as mentioned in ARR section and looking to the fact that large industrial consumer are opting for open access, the Commission accepts the proposal of load factor based incentive scheme wherein consumers will be incentivized by way of lower tariff for higher consumption.

5.5

Further, the Discoms may analyse this aspect in light of high availability of power and file appropriate proposals for incentive scheme for higher consumption for other categories of consumers also, which may fetch additional revenue and encourage consumers to purchase power from Discoms only. Power Factor Rebate

5.6

With regard to Power Factor rebate Discoms submitted that low power factor is detrimental to the network of the licensee. Power Factor of Page 103 of 146

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system is governed by nature of load. Generally low power factor is caused by the highly inductive load on the system. Due to low power factor actual working component of the power gets reduced leading the system to overloading, Higher Line Losses and Voltage Dip. Economical operation of the system is difficult in low power factor scenario as appropriate infrastructure needs to be added to compensate its ill effects. So, it becomes very important that a reasonable value of power factor to be maintained for reliable & economical operation of the system. Discoms submitted that following are the ill effects of low power factor: · System load with a low power factor draws more current than a system with a higher power factor · Low power factor draws higher internal current which generates excessive heat that further reduces the equipment life or damages the equipment · Increased reactive loads can reduce output voltage and damage equipment sensitive to reduced voltage Discoms submitted that considering the above ill-effects of a low power factor and benefits of maintaining a higher power factor, the power factor penalty/rebate structure is already present and applicable. However, Discoms have proposed to modify the structure to ensure that the rebates are commensurate with the benefits accrued to the network. As the benefits do not increase equally for every percentage point improvement in power factor, Discoms have proposed to introduce graded power factor rebate in the following manner: In case average power factor is above 0.95 (95%), an incentive of 0.5% of energy charges shall be provided for each 0.01 (1%) improvement above 0.95 (95%) till 0.97 (97%). If the average power factor is above 0.97 (97%), an incentive of 1% of energy charges shall be provided for each 0.01 (1%) improvement above 0.97 (97%). Where the installation of the meters at the consumer’s premise comply with the requirements of the CEA (Installation & Operation of Meters) Regulations, 2006, in case average power factor is above 0.950 (95.0%), an incentive of 0.05% of energy charges shall be provided for each 0.001 (0.1%) improvement above 0.950 (95.0%) till 0.970 (97.0%). If the average power factor is above 0.970 (97.0%), an incentive of 0.1% of energy charges shall be provided for each 0.001 (0.1%) improvement above Page 104 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

0.970 (97.0%). In case the average power factor falls below 0.90 (90%), a surcharge of 1% of energy charges for every 0.01 (1%) fall in average power factor below 0.90 (90%), shall be charged. Where the installation of the meters at the consumer’s premise comply with the requirements of the CEA (Installation & Operation of Meters) Regulations, 2006, in case average power factor falls below 0.900 (90.0%), a surcharge of 0.1% of energy charges for every 0.001 (0.1%) fall in average power factor below 0.900 (90.0%), shall be charged. If the power factor falls below 0.70 (70%), the installation shall be disconnected and will not be reconnected till the time average power factor is improved to the satisfaction of the Petitioner. In this regard, some of stakeholder submitted to continue the present incentive on power factor improvement of 1% on full tariff instead of Discoms proposal of 0.5% of energy charges for each 0.01(1%) improvement above 0.95 (95%) till 0.97(97%). They also submitted that the proposal of Discoms is to reduce incentive rate for power factor in the range of 0.95 to 0.97 by half of that at present but no financial basis of capital cost of capacitor installation vis-à-vis incentive has been given. Stakeholder also submitted that the existing incentive of keeping average power factor above .95 (95%) may be continued for 132 KV EHT consumer, who is owning, operating & maintaining his sub-station at his cost. It was also submitted that the proposed clause should only be made applicable for general consumers. Commission’s view 5.7

Commission observes that improvement of power factor mainly benefits the consumers by way of reduced demand charges besides to the system. Therefore, there is a merit in the submission of Discoms. It is undisputable that if the consumer maintains a higher power factor, he derives the benefit of reduced demand charges and consequently it becomes commercially beneficial to him to install a capacitor. Further, the extent of benefit the consumer gains by investment on capacitors is quite substantial as compared to the cost of the capacitors installed.

5.8

As such the Commission accepts the proposal of Discoms. However, in the last para the words “will not be reconnected till the time average power factor is improved to the satisfaction of the petitioner” shall be Page 105 of 146

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replaced with the words “will not be reconnected till the consumer undertakes to improve the power factor to the satisfaction of the Discoms within (2) months time from the date of notice”. Voltage Rebate 5.9

Discoms have proposed to redefine the applicability of the voltage rebate which should be applicable only on the energy charges and not on both energy charges and fixed charges. This shall facilitate economic pricing of electricity reflecting the true costs/ benefits of availing supply at higher voltage level.

5.10

Discoms also clarified that the benefits of higher voltages are only in terms of savings in energy alone and there is no impact on fixed charges. The maintenance cost for HT lines are higher compared to lower voltage lines, at present the fixed charges in the tariff do not ensure recovery of fixed cost elements. Accordingly, they have proposed that voltage rebate should be allowed only on the energy charges or units billed.

5.11

Some of the stakeholders requested to continue the existing voltage rebate on both energy and fixed charges instead of only on the energy charges as proposed by the Discoms. They also submitted that in order to avail the incentives of voltage rebate, consumers have to make heavy capital expenditure on transformation capacity, its bay and upgradation of voltage level supply line, which will result in saving in cost incurred on infrastructure to be provided by Discoms, which is further recovered through fixed charges. Therefore, the rebate should also be given on fixed charges. It is further submitted that withdrawal of incentive/rebate by Discoms, once heavy capital investment has been made should not be allowed. Commission’s view

5.12

The Hon’ble Supreme Court in the case of Hyderabad Engineering Vs APSEB (reported in 1988(2) Scc. 181 has recognized the right of the supplier to insist upon the high consuming consumers to avail power supply on higher voltage as higher the voltage lower the transmission losses. Page 106 of 146

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5.13

Commission has considered the proposal of Discoms as well as plea of industrial consumers. Commission observes that availing power at high voltage gives permanent benefit to the consumers in terms of quality of power and investment is done one time only, which will be recovered by them from end users of their products. Further, availing power supply at high voltage is in overall interest of the electricity consumers. Therefore, considering the interest of both Discoms and consumers, Commission find the proposal of Discoms fair and reasonable and hence decides to accept the same. Domestic Service (Schedule DS/LT-1)

5.14

With regard to domestic services Discoms have proposed to clarify that in case of a new consumer, for the first six months, Fixed charges are levied at the lowest slab of General Domestic-1 and not in Small Domestic and thereafter on the basis of six months average consumption. Discoms have suggested modified terms and conditions as follows: “Fixed charges shall be levied on the basis of average monthly consumption of previous financial year. In case of a new consumer, for the first six months, Fixed charges shall be levied at the lowest slab of General Domestic and thereafter on the basis of six months average monthly consumption.”

5.15

It is further clarified by Discoms that connection to a new consumer is provided under General Domestic only and to provide the benefit of rebate provided to Small Domestic, it has to be first ensured that the consumption does not exceed 50 units in any month. Commission’s view

5.16

It is observed that above clarification as proposed by Discoms is for the purpose of timely classifying and providing benefit to domestic consumers for applicable slab. Therefore, the Commission accepts the proposal of Discoms Prompt Payment Rebate

5.17

With regard to prompt payment rebate, Discoms submitted that at present an incentive of 0.15% is being allowed on energy and fixed Page 107 of 146

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charges in the next bill if payment is received before seven (7) working days from the due date of the bill. Discoms have proposed to add another provision to incentivise consumers for prompt payment which will also improve the cash flows of the Discom. Accordingly they have proposed to allow an incentive of 0.35% on energy and fixed charges in the next bill if payment is received before ten (10) days from the due date of the bill. 5.18

Discoms submitted that considering the interest rate of 12.40% per annum the rebate for 10 days would be 0.35%, accordingly the Discoms have proposed the aforesaid rebate. Commission’s view

5.19

The Commission observes that the above proposal would be beneficial for both consumers as well as Discoms, wherein on the one hand consumers would be benefited in terms of slightly lower payment and on other hand improve the cash flow of the Discoms, therefore, the Commission accepts aforesaid proposal of prompt payment rebate. In case of payment by cheque, rebate shall be applicable only if cheque is realized before ten days from due date. Temporary Supply tariff

5.20

Discoms have proposed to modify the existing Tariff for temporary supply, wherein, the applicable tariff for corresponding permanent supply plus 50% is being charged, the same is being proposed to be revised to the corresponding permanent supply tariff plus 10% for a period of two months.

5.21

Discoms further clarified that the proposed change would be applicable for a group of consumers, trusts and societies holding events like fairs, exhibitions and decorative purposes and will not be applicable for individual consumers and for construction purposes. Post the period of two months the existing clause (permanent tariff plus 50%) will be applicable.

5.22

In this regard Stakeholders submitted that either the proposal of change of temporary tariff for the corresponding permanent supply plus 50% to 10% be made applicable for construction purpose also or permanent Page 108 of 146

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connection may be allowed for construction of building where the duration is more than one year. 5.23

Some of stakeholders also submitted that changes in temporary supply tariff should be applicable to all and not only for the events of commercial nature. Commission’s view

5.24

The Commission observe that Discoms have not submitted all the material details and financial implication of the aforesaid proposal. Therefore, the proposal of Discoms is not accepted by the Commission. Contact Demand

5.25

Discoms have proposed to increase the existing ceiling limit 105% of the contract demand to 120% during night hours (22:00- 06:00 hours) for deemed energy drawl from Discoms, in order to encourage the user to consume power during night hours which would help to ease out the load curve. Commission’s view

5.26

In light of higher energy availability as mentioned in ARR section and looking to the fact that large industrial consumer are opting for open access, the Commission accepts the Discoms proposal wherein consumers will be incentivized by way of increase in ceiling limit of contract demand in night hour. Cross Subsidy

5.27

As per Regulation 89 of RERC (Terms and Conditions for Determination of Tariff) Regulations, 2014, the average cost of supply and realization from a category of consumers shall form the basis of estimating the extent of cross subsidy and determination of tariff for that consumer category.

5.28

Regulation 89 of RERC (Terms & Condition of Tariff) Regulations, 2014 read with National Tariff Policy makes it evident that average cost of supply has to be the benchmark in assessing cross-subsidy from any consumer category. The National Tariff Policy states that SERC shall notify a road map with a target that tariff are within +/- 20% of average cost of supply. The Commission has also specified in its Tariff Regulations Page 109 of 146

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that the Commission shall endeavour to determine the tariff in such a manner that it progressively reflects the average cost of supply and the extent of cross subsidy to any consumer category is within maximum range of +/- 20% of average cost of supply. 5.29

Average cost of supply for the three Discoms as per ARR and sales considered by the Commission earlier in this order for FY 2017-18 are as under: Table 100: Average Cost of Supply for FY 2017-18 Particular Net ARR (Rs. In crore) Sales (MU) COS (Rs./Unit)

JVVNL 14,612 19,750 7.40

AVVNL 10,439 14,233 7.33

JdVVNL 13,218 18,958 6.97

Total 38,269 52,941 7.23

5.30

The Discoms have not proposed any tariff revision. Therefore, cross subsidy for various consumer categories at existing tariff shall be as under: Table 101: Cross Subsidy for FY 2017-18 Particular JVVNL AVVNL JdVVNL Total. Domestic Service -6% -2% 0% -3% Non- Domestic Service 29% 28% 31% 30% Public Street Light 0% 7% 8% 4% Agriculture Metered Supply -32% -31% -30% -31% Agriculture Flat Rate Supply -26% -26% -23% -25% Small Industrial Services -3% 4% 7% 2% Medium Industrial Service 6% 10% 17% 11% Large Industrial Service 7% 16% 38% 16% P.W.W. & S. Pumping - Small -10% -8% -7% -8% P.W.W. & S. Pumping - Medium 0% 0% 9% 3% P.W.W. & S. Pumping - Large 1% 6% 15% 8% Mixed Load/ Bulk Supply 3% 11% 7% 5% Revenue Deficit/Gap 5.31

Discoms have shown a combined deficit of Rs 7660 Crores and Rs. 14032 Crore during FY 2016-17 and FY 2017-18 respectively whereas no tariff increase is proposed during FY 2016-17 and FY 2017-18. The Discoms submitted that they have taken various initiatives to reduce the cumulative revenue gap and to improve overall efficiency such as Loss Reduction, Feeder Segregation, Billing efficiency, Network Page 110 of 146

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Strengthening, Cost Optimisation, Vigilance Drives, Private Sector Participation, Demand Side Management, Focus on customer service and other efficiency improvement measures. 5.32

Against the aforesaid deficit, after taking into account the loan taken over by Government under UDAY, Commission has approved the deficit of Rs. 3526 Crore and Rs. 1470 Crore for FY 2016-17 and 2017-18 respectively, the Discoms should attempt to bridge the gap by taking measures for loss reduction, efficiency improvement and Cost optimization.

5.33

Commission accepts the reasons for not proposing tariff revision for FY 2016-17 and FY 2017-18 and decides to continue the tariff as determined vide order dated 22.09.2016 for FY 2016-17 and FY 2017-18 and also till the next tariff order of the Commission is passed. All existing provisions which are not modified by this order shall continue to be in force.

(S.C. Dinkar) Member

(R.P. Barwar) Member

(Vishvanath Hiremath) Chairman

Page 111 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Section 6 - Way Forward

6. Way Forward 6.1

The power sector is witnessing rapid changes over the last few years. Under the Electricity Act, 2003 several initiatives have been taken for development of electricity industry, promoting competition, protecting interests of the consumers and supply of electricity to all areas etc.

6.2

The Standards of Performance have also been specified according to which Discoms shall provide services within time limits specified and This regulation also provides for complaint handling mechanism, payment of compensation and Minimum Overall Standards of Performance to be achieved by a Licensee. This has increased the expectations of the consumers of delivery of a quality and reliable supply.

6.3

During previous years, to cater the demand, the large scale capacities have been added and focus has always been on conventional power generation, as alternatives were very costly. To promote the environmentally benign policies envisaged under the Electricity Act, 2003, Commission has specified preferential tariff for renewable energy and also specified Renewable Purchase Obligation (RPO) for obligated entities including Discoms. The validity of Regulations framed by the Commission enforcing RPO in the State was challenged before Hon’ble High Court, Rajasthan and Supreme Court of India However, the decision of the Commission was upheld by the Hon’ble Courts.

6.4

Govt. of India has set a target of 175 GW of Renewable Power by 2022, 100 GW of this is planned through solar energy, 60 GW through wind energy. The State has been given targets of 5762 MW Solar and 8600 MW Wind power, which would require the huge scaling up of generation from these sources in the State. The year 2017 has seen turning points for both wind and solar PV prices. The lowest bid as low as Rs.

2.44/kWh has been received in a recent bidding for phase-III of

Bhadla solar park. Similarly, in a first ever competitive bidding based price discovery of wind power procurement, a new low of Rs. 3.46/kWh has emerged. RPO has also been increased in line with National goal. Now with parity in prices the focus may be shifted to capacity additions Page 112 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

using solar and wind energy. In order to enable installation of distributed rooftop solar PV systems in the State, the Net Metering has also been introduced by the Commission. This will not only reduce the losses of the Discoms but also defer their investments on new capacities and upgradations in the transmission and distribution systems. Further, Forecasting and Scheduling Regulations has been put in place by the Commission to enable generation from solar and wind sources seamlessly integrate into the grid. 6.5

With the advent of open access envisioned under the Electricity Act, 2003, the end consumers especially, subsidising consumers with higher demands, are opting for open access . The short term power market has become an integral part of the power sector. Electricity which used to be available at Rs. 5 to 6/kWh unit earlier is now available at an average price of around Rs. 2.50 to 3.50/kWh. As high paying consumers have started frequently switching over from Discoms to open market due to which Discoms started facing operational problems. Due to this the demand growth is not high as envisaged by the State Discoms and demand forecasting also became challenging for them. Looking to the development in power sector and with a view to ensure smooth grid operation and to balance the interest of open access consumers and Discoms, the Commission has introduced RERC (Term & Condition of Open Access) Regulation 2016. This has brought in the requisite discipline in the system.

6.6

Govt. of Rajasthan is aiming at power for all, which requires huge investment. However, keeping in veiw the large public interest the Commission will continue to encourage to provide power to all.

6.7

Discoms of Rajasthan were facing financial stress due to various reasons. This was inturn affecting the consumers services. Therefore, to overcome this situation GoI and GoR framed a financial scheme namely “UDAY” which will take out the Discoms from financial distress.

6.8

While issuing the last tariff order dated 22.9.2016, the Commission took note of UDAY Scheme subject to fulfillment of conditions sets therein which were almost akin to Commission's earlier Directives. The Commission also noted the various measures to be taken for efficiency improvement and losses reduction under UDAY which, while Page 113 of 146

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restructuring the finances of the Discoms, has also imposed several stringent conditions for improvement in efficiency. 6.9

Commission in its last order dt. 22.09.2016

6.10

gave various directives and stressed the need for fulfilling the conditions under UDAY Scheme. In the same order Commission noted that it would also look into the development closely. It has been observed that Discoms have taken various initiatives under “UDAY Scheme”

6.11

It has been observed that Discoms have complied with the various direction issued in previous tariff dated 22.09.2016. With regard to conversion of urban flat rate consumers, Discoms submitted that meters have been provided on all the urban areas flat rate agriculture consumers. With regard to reduction of losses to 15% under UDAY, Discoms have submitted that a road map with quarterly target for reduction of AT&C losses have been prepared and officers have been directed to implement measures so as to bring the loss level down to specified targets. With regard to Energy Accounting & Auditing and consumer indexing, Discoms have submitted that 11 KV feeder wise energy accounting has been started under Network Indexing Module (NIM), they have appointed consultant for energy audit of all subdivisions of Discoms and Consumer indexing of all the 11KV feeders have been completed and DT wise consumer indexing is under process. With regard to voltage wise cost of supply, Discoms submitted that the work of feeder segregation is under progress. The DT metering also has not yet been completed. Upon completion of the above works in progress, the basic parameters required for ascertaining voltage wise losses will be available subsequently which will help in computation of voltage wise cost of supply. Discoms have submitted that they are carrying consumer education programmes for saving electricity including advantages of using star labelled equipments. Regarding basic facilities at sub-division, Discoms submitted that the basic amenities for the consumers are in existence & have been provided in all sub division of Discoms. Also one employee in sub division has been designated as consumer clerk/ consumer friend to guide/ facilitate the consumers. With regard to replacement of defective meters Discoms have submitted that they Page 114 of 146

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have issued the necessary direction for replacement of defective meters. With regard to ERP implementation Discoms submitted that they have appointed the consultant for preparation of DPR and the same has been submitted to PFC for approval. 6.12

Discoms considering the benefits arising out of UDAY have not proposed any revision in tariff for FY 16-17 and 17-18 which will place the consumers at ease. Instead of increase in tariff they have proposed necessary steps like loss reduction, improvement in billing efficiency to reduce the cumulative revenue gap and to improve overall efficiency, Network strengthening and Vigilance Drives.

6.13

Discoms have also resorted to private sector participation by way of Distribution franchisee and demand side management.

6.14

Progress made by Discoms under UDAY has been reviewed and noted below. Its effect on finances of Discoms has been considered in ARR section of this order.

6.15

The Commission observes that UDAY, though time being has addressed the issue of interest burden on Discoms but will prove useful in long term only if the Discoms achieve goals of AT&C losses reduction along with desired level of operational efficiency. Discom should ensure that they achieve the prescribed goals otherwise they will again fall in debt trap as UDAY does not offer any cure for inefficiency.

6.16

In a recent review the status of achievement of various goal set under UDAY by Discoms is as under:

· ·

Goal 1: AT& C Loss Reduction Target under UDAY by FY 18-19: 15% and for FY17-18 is 18.78% Achievement for AT&C loss levels reduced from 28.36% FY-16 to 23.81% FY-17 (-4.55% )

·

Goal 2: Eliminate ACS-ARR Gap by FY19 Target : Eliminate ACS-ARR Gap by FY-19 and ACS ARR Gap to Rs. 0.25 pu in FY-18

·

Achievement: 1. ACS & ARR gap reduced from Rs. 2.36 pu FY-16 to Rs. 1.02 pu in FY-17 2. Interest burden reduced from Rs. 1.96 pu FY-16 to Rs. 0.96pu in FY-17 Page 115 of 146

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3. Distribution Franchisee appointed in Kota, Bharatpur, Bikaner & Ajmer City Goal 3: Metering at All Levels ·

Target: 100% feeder metering up to June’16, DT level metering in RAPDRP towns as per Discom’s policy) And AMR metering for high value consumers (LIP+MIP)

·

Achievement: 1. 100% (19904/19904) Rural and (4018/4018) Urban 11kV feeder metered 2. 14078/22045 DT metered in Go-Live towns 3. AMR metering provided to 12798/38000 high value consumers

·

Goal 4: Energy Audit Target: 100% energy audit at 11kV feeders by Sept’16 and DT level energy audit in RAPDRP towns

·

Achievement: 1. Energy audit started for all 11kV feeders w.e.f. Sept’1 2. Feeder in-charge appointed for each feeder 3. Energy audit for 67% feeders validated, remaining by June’17 4. Energy audit started for 14078 DT’s in RAPDRP towns (under Validation)

· ·

Goal 5 : Connection to Un-connected Households Target:30 lac household by FY 19- target of 12th plan-20.5 Lakh Achievement: 18.88 lacs households electrified in last 3 years and Remaining by (June’18 – March 19)

·

Goal 6: Demand Side Management Target: Provide LED under DELP/UJALA Programme and Replacing at least 10% existing agriculture pumps with energy efficient pumps by March’19

·

Achievement: 1. 1.33 Cr LED, 24188 Energy Efficient Fans, 75841 tube lights distributed. Page 116 of 146

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2. Replacement of 28 pump sets under pilot project, DPR for 31200 pump sets under process ·

Goal 7: Increase Employee Engagement Target: Capacity Building of employees, devising KPIs and Customer Service Strategy and ERP Implementation

·

Achievement: 1. Various trainings conducted for senior officers at corporate office and for subordinate staff at district level 2. KPI’s for O&M offices have been finalized and issued 3. Average 1 lac complaints registered monthly and more than 97% resolved within time

Apart from that Discoms have also taken following measures for reduction of AT&C losses:

Measures for reduction in AT&C Losses (In Rural Areas): Rural area target 15% by March-18 (i) (ii) (iii)

11 kV Feeder to be smallest unit for measurement. One Feeder In charge for each feeder. Public Reps. & District Admn. to be involved in loss reduction.

(iv) (v)

Feeder Management Committee being constituted. Each JEN to identify 33 kV S/S in phases.

(vi) (vii) (viii) (ix)

Identification of technical interventions on each feeder. Technical interventions to be completed by December 2017. Feeder vigilance squad - after technical interventions. Workshops have been conducted.

Measures for reduction in Losses (In Urban and Industrial Areas) Urban areas Reduction in AT&C Losses Target – < 15% 1. XEN to be responsible 2. DT-wise energy audit in high loss areas 3. Implement scheme like

Industrial areas Reduction in Dist. Losses 1. Target – < 2% 2. XEN to be responsible 3. Feeder wise energy audit 4. Suitable technical interventions Page 117 of 146

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undergrounding or overhead AB 5. cable, system 4. Timely replacement of defective meters 5. Necessary vigilance

Necessary vigilance

6.17

Apart from UDAY, Rajasthan State Electricity Distribution Management Responsibility Act, 2016 has been enacted to provide for responsibilities of the State Government and State Distribution Licensees to ensure financial and operational turnaround and long-term sustainability of the State-owned Distribution Licensee to enable adequate electricity supply to consumers through financial restructuring support on sustainable basis in the areas of long term planning corporate governance regulatory compliances and laying down of policy directives and various other measures connected therewith or incidental thereto.

6.18

It is observed that though Discoms are moving towards efficiency improvement, but significant improvement is yet to be achieved and above initiatives would not be sufficient to overcome financial crisis faced by the Discoms and apart from above, the Discoms should also focus on the following measures of revenue enhancement and expenditure control.

A. Revenue Side Management With regard to revenue management the Discoms shall ensure the following which will bring enormous benefits: 1.

Focus on metering, billing and collection In last Tariff order, the Commission noted that a lot more is required to be done in this area. Metering, Billing and Collection are three important commercial activities which is the financial backbone of Discom. As discussed earlier and as mentioned in UDAY Scheme, use of AMR meters, issue of bills through SMS/e-mail, availability of bills through website and allowing online payment is the need of the hour. Discoms during proceedings have also submitted that they are taking steps for improvement in Metering, Billing and Collection activities but results of these are yet to be reflected in financial position of Discoms. Therefore, Discoms must focus on considering the AMR metering, e-billing and eCollection. Page 118 of 146

Petition No. RERC 1077/17, 1078/17, 1076/17

Discoms should focus on the activities, like installation of the new meters/replacement of the defective meters on war footing ,prepare age wise and category wise details of arrears and chalk out action plan for recovery of arrears, Introduce checks and balances for billing errors. Discoms should ensure to take energy audit seriously and make use of results of energy audit. Periodic analysis of result of energy audit for each feeder must be conducted at circle level and responsibility of feeder managers/ field level officers must be fixed for taking corrective actions. Revenue Audits should also be carried out to find out revenue leakages and loopholes must be plugged. Bills should be delivered timely so that maximum number of consumers can avail prompt payment facility. During Public hearing MD, JVVNL submitted that they have prepared a web/mobile based application for use of consumers. Discoms should make maximum use of technology to reduce errors, minimize human intervention and increase customer satisfaction. 2.

Step up vigilance activity for better revenue collection Curbing of theft should be of prime concern for the Discoms. The Discoms are advised to strengthen their vigilance cells and take up frequent checking of theft prone areas. Discoms should take appropriate steps to improve revenue collection in relation to revenue assessed. The Commission reiterates that in appropriate cases, instead of giving benefit of compounding as a routine course, Discoms shall pursue penal actions such as initiating prosecution both against the consumers and others who conspire so that people are deterred from indulging in theft. Discoms may also initiate penal action against the employees and officers, if they are found to be conspiring with the person making the theft. It is well known that prevention is always better than cure. Therefore, Discoms instead of going in search of thieves may also consider such initiative which will reduce the scope of theft by regular checking of theft prone areas at such intervals as has been found necessary in each case and also by taking appropriate technical interventions, such as installation of tamper proof meters, etc.

3.

Monthly billing for all consumers In the last tariff Order Commission had observed that the Discoms should consider to shift consumers from bi-monthly to monthly billing, which will Page 119 of 146

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help in speedy recovery of funds, improve the cash flow position and early identification of defaulting consumers. Therefore, Discoms now should take steps for necessary changes in the billing software, so that atleast from 01.04.2018 the billing is made on monthly basis for all category of consumers. 4.

Load/Demand based billing Commission from time to time has stressed that Discoms should move towards demand based billing, so that the fixed tariff are charged and collected more scientifically. In the tariff order for FY 2012-13, the Commission had allowed LT MIP consumers to opt for billing on the basis of demand. Further, in the tariff order for FY 2013-14, the Commission while moving towards goal of demand based billing for all categories of consumers allowed LT consumers of Non Domestic category (NDS/LT-2) and Bulk supply for Mixed load category (ML/LT-7) having sanctioned connected load more than 18.65 KW (25HP) also to opt for billing on the basis of demand. Now meters installed are having load/demand recording facility, the Commission desires to extend the facility of load/demand based billing to all categories of consumer during next financial year. So that the consumers will be billed based on their actual load/demand usage. This step will also save precious time of field staff of the Discoms which they can utilize to curb theft and ensure better consumer services, instead of keep on checking the connected load of consumers. which is an irritant to honest consumers Accordingly, Discoms may file suitable proposal with the next tariff filing.

5.

Private Sector Participation Input based distribution franchise model has already been introduced in one or two circles in each Discom. During the hearing, MD, JVVNL has informed that franchisee operations are yielding good results. Successful model can be replicated in other circles. PPP model may also be explored where private participation with higher accountability may be considered. For improving billing and collection efficiency and reduction Page 120 of 146

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in AT&C losses, private sector role may also be suitably considered. B. Expenditure Side Control Discoms should minimize the expenditure and focus on individual item of expenditure to curtail it to the possible. Special focus should be given to the major item of cost i.e. power purchase and interest cost along with control on capital expenditure and other expenses. 6.

Power Purchase cost Discoms in their petitions have submitted that improved power purchase management, better forecasting, load curve straightening, improved inventory management etc. have been planned with the use of better systems and IT implementation. The Discom is actively working on improving its efficiency of power procurement especially to take advantage of cheaper power available at exchanges or through bilateral deals. The Discom are also evaluating other options such as surrendering costly PPAs, under-drawing power through PPAs when the variable cost is higher than what is available bilaterally or through exchanges. They are also undertaking measures for accurate load forecasting so that impact of over drawl and under drawl on power purchase cost can be minimized. These measures will help to optimise the cost and reduce the existing revenue gap. The Commission notes the submission of the Discoms and observes that Power Purchase Cost is the most significant cost component and need to be managed dynamically. Discoms may have a comprehensive relook on all power purchase tied up by them vis-à-vis their requirement and decide future course of action in cost effective manner.. Proper and adequate arrangement of economical solar power will also assist the Discoms to supply the day time power at lower tariff as the line loss would be lower.

7.

Late Payment Surcharge and Interest Cost Post UDAY financial position of Discoms has improved and now Discoms should ensure that it makes the timely payment to power suppliers so that no additional liability towards late payment surcharge is incurred and instead Discoms shall avail prompt payment incentive.

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Discoms should also keep on looking for cheaper and economical sources of funding to reduce the interest rate and finance charges. Discom should ensure that they timely get the subsidy from State Government , realise their dues from consumers and make timely debt servicing so that they should not fall into debt trap. The Govt. of Rajasthan, which has stood rock solid behind Discoms shall ensure timely release of subsidy as prescribed in the subsidy Regulations. 8.

Day power to agriculture sector: The average cost of Discoms for supplying power has reached approximately to Rs. 7.23/kWh. The tariff of agriculture category is already charged on lower side as compared to other categories. Additionally State Govt. is providing huge tariff subsidy of approximately Rs. 7000 crore per annum to this category. In the recent past the solar PV technology is rapidly becoming less expensive and now electricity generated from this technology is available at cheaper rates (below Rs 2.50/kWh). The solar PV generation, when deployed as a distributed generation, would not only reduce the power purchase cost of the Utilities but would also result in savings in T&D losses. In addition, this would allow them to defer their future investments in new generation capacity and up-gradation of the existing transmission and distribution system. The distributed solar PV generation would cater the day time power demands of the agriculture sector but would also make their power supply more reliable as the power is generated by many generators spread over a wide geographic area. This makes it harder for a large area to be without power and easier to maintain grid stability. Considering average power purchase cost of Rs. 3.70/kWh and a saving of technical distribution loss of 15% and Transmission losses and also considering savings in investment, it may be assumed that by making use of the distributed solar generation the Discoms save Rs. 2 /kWh. The estimated sales for Metered Category agriculture Consumers is approx 20000 MUs. If only 25% of these sales (present or future) are shifted to distributed solar PV generation there is a scope of savings of approx Rs. 1000 crore which can be utilized for reducing accumulated losses or government subsidy. Though above outlook may appear ambitious but in long term Discom may have to strategically adopt such measures. Greening the grid is new mantra. As such Discoms may examine and explore the possibilities of inviting tehsil wise/District wise bids for setting up of the distributed solar PV Page 122 of 146

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projects preferably in the vicinity of existing distribution system substations to cater to the agriculture/rural load requirement. Primary Schools mainly require day time power. In such cases solar PV not only fulfills the power requirement but also saves the Cost which can be used for other purposes. Likewise, other places like Panchayat Samitis, Primary Health Sub-Centres also require day time power. In all such cases solar PV is a cheap and viable option which not only relieves the distribution system but also help in avoiding future investments needed for upgradation of the distribution system. Therefore, Discoms may take up this with the State Govt. on priority and take further action. C. Other Measures 1.

Focus on services improvement – Discoms should run a program for skill development, imparting training, refresher training to new entrants, engineers, administrative and financial personnel, technical workmen and the executives for improving their services. Discoms are advised to relook into their manpower requirement as it has a direct impact on the quality of consumer service provided by them. The shortage of technical staff required for maintenance of lines and restoration of supply as well as the other operation related issues need to be looked into by Discoms at priority. The Discoms must strive hard to follow the norms laid down in Standard for Performance for Distribution Licensees, Regulations, 2014, for better customer services. The Commission vide Rajasthan Electricity Regulatory Commission (Electricity Supply Code and Connected Matters) XIth Ammendment Regulations, has also introduced following measures:Simplification of process of release of new connection: (1) The process of releasing new connection has been simplified. Now there will be no application fee for LT domestic consumers. (2) In order to expedite the process of release of a new connection, in case of an application received with all required documents and Page 123 of 146

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distribution licensee fails to accord sanction or communicate reason for refusal for the proposed connection within 30 days, the connection shall be deemed to have been sanctioned. Simplification of Agreement: (3) The agreements to be executed by HT/EHT consumers applying for a new connection have been simplified to minimize the disputes. For other consumers the application form itself shall be the agreement. Facility of using existing connection for construction purpose: (4) Existing LT domestic and non-domestic category consumers shall be able to use their existing connection for the purpose of further construction in the same premises provided their connected load/ contract demand doesn’t exceed their overall sanction load/demand. However this facility shall not be available for construction of building complexes and to other categories of consumers. Transfer of connection and transfer of security: (5) In order to facilitate the transfer of connection from one consumer to other detailed modalities have been introduced. The facility of transfer of security has also been provided in cases of transfer of connection/clubbing of connection. Interest on security deposit: (6) The procedure of payment of interest on security deposit of the consumer lying with licensee has been made more transparent. Now the distribution licensee is required to give details of the security deposits lying with it and the interest thereon along the bill of the month in which the interest is adjusted. Provision for self-reading of meter: (7) In case of non-receipt of electricity bill, the facility of self-reading has been introduced for the consumers according to which the consumer may read meter by himself for the period for which the bill is not received. The assessment in case of stopped/ defective, lost or stolen meter where previous period record is not available: Page 124 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

(8) In such cases the consumer shall be billed provisionally on the basis of 25% load factor on 8 hours use per day in case of domestic category and 50% load factor on 8 hours use per day for all other categories and the assessment shall be reviewed average consumption of succeeding six month period after installation of correct meter and charged accordingly. Provision for refund of testing fee in case of meter is found inaccurate: (9) (i) In order to provide relief to the consumer in suspected cases of inaccurate meters, the testing fee deposited by the consumer shall be refunded/ credited by the distribution licensee to the consumer’s account, if a meter is found inaccurate. (ii) The copy of MRI Reports/ Laboratory test report detecting inaccuracy shall also be required to be made available to the consumer. (iii) In cases of meter found inaccurate, the time limit of intimation of consumption assessment has been reduced from six months to two months. Annual statement of account: (10) On a payment of a token amount of Rs 10/- by a consumer, the licensee has to furnish the details of statement of accounts of consumers duly indicating the consumption, date of payment and amount thereof, the security held and interest payable and when it was paid, additional security, if any, required and due date of the same. Introduction of cheque dishonor fee: (11) To take care of cheque dishonor cases, the provision has been made that no further cheques shall be accepted from such consumers without prejudice to the licensee taking action such as levying cheque dishonor fee besides initiating prosecution under the applicable law. Rebate on Advance payment: (12) If a consumer under any category voluntarily deposits the average amount of six or twelve months energy bill on the basis of average bill of preceding year in advance, he would be allowed a rebate at the rate equivalent to Bank Rate as on 1st April. Page 125 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Rationalisation of process of disconnection: (13) (i) In cases of disconnection of supply, in addition to the notice, the licensee shall also intimate the consumer through sms/e-mail on his registered mobile number/e-mail id if available. (ii) The licensee shall not disconnect the supply on general holidays and Sundays. (iii) Disconnection of power supply shall be effected as far as possible before 1.30 PM and reconnection shall preferably be effected on the same day of payment. (iv) If arrear is Rs 100/- or less, there will be no disconnection and arrears shall be carried forward to the next bill. (v) If a consumer produces proof of payment or deposits under protest, an amount equal to the sum claimed from him or the electricity charges due from him for each month calculated on the basis of average charges for electricity paid by him during the preceding six months, whichever is less, his supply shall not be cut off/if cut off shall be reconnected immediately. Recovery of old outstanding dues: (14) The distribution licensee shall be able to recover old outstanding dues against any permanently disconnected connection from another existing/new connection in the name of same person. Relief in penal assessment in case connected load is found more than sanctioned load: (15) A relief has been provided to the consumers in cases of unauthorised use of electricity, where the sanctioned connected load gets exceeded through meter (other than domestic and small (upto 5 kW) non-domestic consumers). Earlier, in such cases the penal assessment was being done for the connected load as well as the energy in proportion of exceeded load to total load at twice the fixed charges and energy charges. Now the penal assessment shall only be made on the basis of quantum of exceeded load and shall be charged only at twice the fixed charges.

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Duplicate copy of bill: (16) Duplicate copy of bill for all category consumers shall be provided free of cost. Charges for release of connection and other miscellaneous charges and rentals have not been increased. Discoms should ensure that all consumers get benefit of measures introduced by the Commission. Discoms may recruit employees at cutting age level i.e. the level requires to cater the need of consumers like lineman, helpers and supervisors etc. 2.

Employees and Consumer Education Discoms should make efforts to create awareness regarding consumer grievance redressal mechanism as well as towards consumer education. To enable Discoms to conduct consumer awareness campaign periodically and institutionalize a mechanism for having a dialogue with the consumers for educating them and addressing common problems in previous order, the Commission has allowed an additional amount of Rs. 50 lakh per Discom, towards consumer awareness /consumers education.

3.

Safety Measures It is observed that number of accidents are happening due to lack of safety measures and lack of awareness among employees as well as general public. Discoms should ensure effective safety measures as envisaged in CEA (Measures relating to Safety and Electricity Supply) Regulations, 2010 and CEA (Safety requirements for construction, operation and maintenance of electrical plants and electric lines) Regulations 2011. The Discoms should conduct necessary training/courses for all employees of the Discoms in this matter. A consumer awareness campaign related to safety issues should also be launched for making them aware about how to avoid accidents and protect themselves, this may be done through TV/newspaper, ads, pamphlets, workshops and seminars or any suitable means. We would also like to note again that the Safety Regulations contemplated overseeing of implementation of these regulations by the Chief Electrical Inspectors/Electrical Inspectors appointed by the State Page 127 of 146

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Government and any non-implementation is to be dealt with by these Inspectors. The Chief Electrical Inspector and Electrical Inspectors are the watchdogs of the Safety Regulations and they shall ensure implementation by periodical checking of any violation of the Regulations. The Govt. of Rajasthan should periodically review the working of Electrical Inspectors and take action if need be for nonperformance of their duties. Proper implementation of safety regulations will avoid electrical accidents which are occurring in large numbers and would save precious life and limbs of the individual and the livestock. In case of criminal negligence State shall not hesitate to prosecute the offender. 4.

Energy Efficiency measures DSM cell of Discoms needs to assume more active role in agriculture sector and use of energy efficient pump sets among farmers. They may also study the dynamics of drip irrigation module with solar based energy efficient pump and reducing dependence of agriculturist in far flung areas on Discom’s system. It is observed that Discoms have distributed 1.33 Cr LED, 24188 Energy Efficient Fans, 75841 tube lights. LED street lights are also giving good results in energy savings. Discoms may also consider to propose a suitable rebate for energy efficient/green buildings and continue to pursue the programs like LED distribution programme.

5.

Tariff for Charging Stations of Electrical vehicle The GoI has launched a National Electricity Mobility Plan 2020 (NEMMP2020) IN 2013 setting a target of 6-7 million hybrid and electric vehicles by the year 2020. Subsequent to above GoI has also launched a scheme for Faster Adoption and Manufacturing of (Hybrid and) Electric Vehicles in India (‘FAME’). Commission intends to promote the alternate sources of energy for transport which are eco-friendly. For achieving this, electric vehicle charging is to be made affordable and easily available everywhere. The Discoms should come out with a proposal for suitable incentivized tariff for such charging station along with next ARR petition.

6.

IT and ERP In last order, the Commission stressed on to implementation of Enterprise Resource Planning (ERP) systems for better and effective Material Page 128 of 146

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Management including inventory management to reduce costs and increase efficiencies. Further, Discoms were also asked to monitor the material management and inventory management so that adequate material is available for its works and at the same time excess purchase of material is avoided in compliance to above direction, Discoms submitted that they have appointed the consultant for preparation of DPR for implementation of ERP system and the same is submitted to the PFC for its approval. Commission observe that the above efforts are not sufficient and Discoms must put in more efforts to implement the ERP system expeditiously. It is observed that Discoms have taken some initiatives towards implementation of IT but that is in bits and pieces, they have to adopt an integrated approach towards IT implementation. . As far as use of Information technology is concerned, it needs no emphasis. The Discoms must promote the use of information technology to save the cost and improve efficiency. Electric power utilities worldwide are increasingly adopting the computer aided monitoring, control and management of electric power distribution system to provide better services to their consumers. Therefore, Discoms should focus on adapting recent advancement in the area of IT (Information Technology), data communication & control system Apart from use of website and online payment, the Discoms must develop and promote mobile applications for billing and collection as well as for customer complaints where consumer grievance can be addressed timely and expeditiously, which will on one hand improve revenue collection of Discoms and on other hand improve the consumer satisfaction level. The long term goal of IT enablement should be transformation of Discoms into a virtual enterprise to handle 24X7 operations with full responsiveness, which the consumers have become accustomed to in e-commerce era. Only with the full IT enablement Discom will be able to derive out the best benefit of investments. -------Page 129 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Annexure – A1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15.

Sh. Y.K. Bolia (JVVNL, AVVNL & JdVVNL) M/s JMRC (JVVNL) Sh. B.M. Sanadhya (JVVNL, AVVNL & JdVVNL) M/s Mansarover Sector-5 Welfare Society (JVVNL) M/s. Credai Rajasthan (JVVNL) Sh. G.L. Sharma (JVVNL, AVVNL & JdVVNL) M/s. Rajasthan Steel Chambers (JVVNL, AVVNL & JdVVNL) M/s. Shree Cement Ltd. (JVVNL, AVVNL & JdVVNL) M/s Rudraksh Energy (JVVNL, AVVNL & JdVVNL) Sh. P.C. Jain (JVVNL) M/s Rajasthan Textile Mills Association (JVVNL, AVVNL & JdVVNL) M/s Rajasthan Vidyut Takniki Karmchari Association (JVVNL) Sh. Rakesh Rastogi (JVVNL) M/s Sunil Health Care (JVVNL, AVVNL & JdVVNL) Sh. Shanti Prasad (JVVNL, AVVNL & JdVVNL)

Annexure - B 1. 2. 3. 4. 5. 6. 7. 8.

Sh. G.L. Sharma Ms. Neha Garg Sh. Rakesh Rastogi Sh. Gyan Singh Sh. Mohit Nebhwani Sh. Sukhmal Jain Sh. S. N. Gupta Sh. B.M. Sanadhya

Page 130 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Annexure C A&G

:

List of abbreviations Administrative and General Expenses

AMR

:

Automatic Meter Reading

APTEL

:

Appellate Tribunal for Electricity

ARR

:

Aggregate Revenue Requirement

AT & C

:

Aggregate Technical and Commercial

AVVNL

:

Ajmer Vidyut Vitran Nigam Ltd.

CAGR

:

Compound Annual Growth Rate

CAO

:

Chief Account Officer

CEA

:

Central Electrical Authority

CERC

:

Central Electricity Regulatory Commission

CESC

:

Calcutta Electric Supply Corporation

COD

:

Commercial Date of Operation

CPP

:

Captive Power Plants

CT/PT

:

Current Transformers/Potential Transformers

CTPP

:

Chhabra Thermal Power Plant

DAE DCCPP DELP

: : :

Department of Atomic Energy Dholpur Combined Cycle Gas based Thermal Power Plant Domestic Efficient Lighting Programme

DISCOM

:

Distribution Company

DPS

:

Delayed Payment Surcharge

DS

:

Domestic Supply

DSM

:

Demand Side Management

DT

:

Distribution Transformer

EA 2003

:

Electricity Act, 2003

ED

:

Electricity Duty

EESL

:

Energy Efficiency Services Limited

EHT

:

Extra High Voltage

ERP

:

FIP

:

Enterprise Resource Planning Feeder Improvement Programme

FR

:

Flat Rate

FY

:

Financial Year

GoI

:

Government of India

GoR

:

Government of Rajasthan

GLTPP

:

Giral Lignite Thermal Power Plant

HT

:

High Tension

JdVVNL

:

Jodhpur Vidyut Vitran Nigam Limited

Page 131 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

JVVNL

:

List of abbreviations Jaipur Vidyut Vitran Nigam Limited

JMRC

:

Jaipur Metro Railway Corporation

KTPS

:

Kota Thermal Power Station

KW

:

Kilo Watt

KWH

:

Kilo Watt Hour

KVA

:

Kilo Volt Ampere

LED

:

Light Emitting Diode

LT

:

Low Tension

LTL

:

Long-Term Loans

MIS

:

Management Information System

MIP

:

Medium Industrial Power

MMH

:

Mini Micro Hydro

ML

:

Mixed Load

MoU

:

Memorandum of Understanding

MU

:

Million Unit

MW

:

Mega Watt

NCES

:

Non Conventional Energy Sources

NDS

:

Non Domestic Supply

NFA

:

Net Fixed Assets

NHPC

:

National Hydro Power Corporation

NLC

:

Neyveli Lignite Corporation

NPCIL

:

Nuclear Power Corporation

NTI

:

Non Tariff Income

NTPC

:

National Thermal Power Corporation

NVVN

:

NTPC Vidyut Vyapar Nigam

O&M

:

Operation & Maintenance

PGCIL

:

Power Grid Corporation of India Ltd.

PLF

:

Plant Load Factor

PP

:

Partnership Projects

PTC

:

Power Trading Corporation

PWW

:

Public Water Works

PV

:

Photovoltaic

RAPDRP RDPPC RBI

: : :

Restructured Accelerated Power Development & Reform Programme Rajasthan Discoms Power Procurement Centre Reserve Bank of India

RERC

:

Rajasthan Electricity Regulatory Commission

RGGVY

:

Rajiv Gandhi Grameen Vidyutikaran Yojana

Page 132 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

RGTPS

:

List of abbreviations Ramgarh Gas Thermal Power Station

RLDC

:

Region Load Dispatch Centre

RoE

:

Return on Equity

ROI

:

Return on Investment

RPO

:

Renewable Power Obligation

R&M

:

Repairs & Maintenance

RVPN

:

Rajasthan Vidyut Prasaran Nigam

RVUN

:

Rajasthan Vidyut Utpadan Nigam

SIP

:

Small Industrial Power

SJVNL

:

Satluj Jal Vidyut Nigam Limited

SLDC

:

State Load Dispatch Centre

SLM STPS

: :

Straight Line Method Suratgarh Thermal Power Station

T&D

:

Transmission & Distribution

UDAY

:

Ujwal Discom Assurance Yojana

Page 133 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Annexure D Approved Tariff for FY 2016-17 and FY 2017-18 DOMESTIC CATEGORY (LT-1 and HT-1) (BPL, Astha Card Holders and Small Domestic having consumption upto 50 units per month)

BPL and Small Domestic Domestic Category Particulars

Approved Tariff Energy Charges BPL and Astha card Holders*

Fixed Charges

Rs. 3.50/ unit

Rs. 100/ connection / month

(i) For consumption upto first 50 units per month Small Domestic* (i) For consumption upto first 50 units per month

Rs. 3.85/ unit

Rs. 100/ connection / month

*Note: The BPL and Astha card Holder domestic tariff shall be exclusively applicable to individual consumer person and shall not be applicable to any institution. In case any BPL, Astha Card Holder and Small Domestic consumers has consumed more than 50 unit per month in any billing cycle, the consumer will be charged as per the applicable tariff of the respective slab under the LT-I domestic category for the additional units consumed.

General Domestic-1 Domestic Category Particulars

Approved Tariff

General Domestic-1 (Consumption upto 150 units/month) Energy Charges (i) For consumption upto first 50 units per month

Fixed Charges

Rs. 3.85/ unit Rs. 200/ connection / month

(ii) For consumption above 50 units and upto 150 units per month

Rs. 6.10/ unit

General Domestic-2 Domestic Category Particulars

Approved Tariff

General Domestic-2 ( Consumption above 150 units and upto 300 units/month ) Fixed Charges

Energy Charges

Rs. 3.85/ unit

(i) For consumption upto first 50 units per month (ii)For consumption above 50 units and upto 150 units per month (iii)For consumption above 150 units and upto 300 units per month

Rs. 6.10/ unit

Rs. 220/ connection / month

Rs. 6.40/ unit

General Domestic-3 Domestic Category Particulars

Approved Tariff

General Domestic-3 (Consumption above 300 and upto 500 units/month)

Page 134 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Energy Charges

Fixed Charges

Rs. 3.85/ unit

(i) For consumption upto first 50 units per month (ii)For consumption above 50 units and upto 150 units per month

Rs. 6.10/ unit

(iii)For consumption above 150 units and upto 300 units per month

Rs. 6.40/ unit

(iv)For consumption above 300 units and upto 500 units per month

Rs. 6.70/ unit

Rs. 265/ connection / month

General Domestic-4 Domestic Category Particulars

Approved Tariff

General Domestic-4 (Consumption above 500 units/month) Energy Charges (i) For consumption upto first 50 units per month

Rs. 3.85/ unit

(ii)For consumption above 50 units and upto 150 units per month (iii) For consumption above 150 units and upto 300 units per month (iv)For consumption above 300 units and upto 500 units per month

Rs. 6.10/ unit

(v)For consumption above 500 units per month

Rs. 7.15/ unit

Rs. 6.40/ unit

Fixed Charges

Rs. 285/ connection / month

Rs. 6.70/ unit

Domestic Category (HT-1) Domestic Category Particulars

Approved Tariff HT – Domestic (HT-1)

For contract demand over 50 kVA

Energy Charges

Fixed Charges

Rs. 6.15/ unit

Rs. 190 per kVA of Billing Demand per month

NON-DOMESTIC CATEGORY (LT-2 & HT-2) NDS up to 5 kW of SCL (NDS- type1) Non-Domestic Category Particulars

Approved Tariff LT-NDS(LT-2)

Type1 (Consumption upto 100 units/month) Energy Charges Rs. 7.55 /unit

Consumption upto first 100 units per month

Fixed Charges Rs. 230 / connection / month

(NDS- type2) Non-Domestic Category Particulars

Approved Tariff

Page 135 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

LT-NDS(LT-2) Type 2 (Consumption above 100 units/month and upto 200 units/month) Energy Charges

Fixed Charges

Rs. 7.55 /unit

Consumption upto first 100 units per month Consumption above 100 units and upto 200 unit per month

Rs. 230 / connection / month

Rs. 8.00 /unit

(NDS- type 3) Non-Domestic Category Particulars

Approved Tariff

LT-NDS(LT-2) Type 3 (Consumption above 200 units and upto 500 units/month) Energy Charges

Fixed Charges

Rs. 7.55 /unit

Consumption upto first 100 units per month Consumption above 100 units and upto 200 unit per month Consumption above 200 unit and upto 500 unit per month

Rs. 275 / connection / month

Rs. 8.00 /unit Rs. 8.35 /unit

(NDS- type 4) Non-Domestic Category Particulars

Approved Tariff

LT-NDS(LT-2) Type 4 (Consumption above 500 units/month) Energy Charges Consumption upto first 100 units per month Consumption above 100 units and upto 200 unit per month Consumption above 200 units and upto 500 units per month

Fixed Charges

Rs. 7.55 /unit Rs. 8.00 /unit Rs. 8.35 /unit

Rs. 330 / connection / month

Rs. 8.80 /unit

Consumption above 500 unit per month

NDS above 5 kW of SCL Particulars

Non-Domestic Category Approved Tariff NDS above 5 KW of SCL (LT-2) Energy Charges

Consumption upto first 100 units per month Consumption above 100 units and upto 200 units per month Consumption above 200 units and upto 500 units per month Consumption above 500 units per month

Fixed Charges

Rs. 7.55 /unit Rs. 8.00 /unit

Rs.95/ KW of SCL / month

Rs. 8.35 /unit

Rs. 8.80 /unit

Rs. 105/ KW of SCL / month Or Rs. 190 per kVA of Billing Demand per month (If SCL is more than 18.65 KW)

Page 136 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

NDS –Contract Demand Over 50 kVA Approved Tariff

HT-NDS (HT-2) For contract demand over 50 kVA

Energy Charges

Fixed Charges

All units

Rs. 8.35 /unit

Rs.190/ kVA of Billing Demand per month

PUBLIC STREET LIGHTING (LT-3) Particulars

Approved Tariff

Public Street Lighting

Energy Charges

Fixed Charges

Population <1 Lakh

Rs. 6.55/ unit

Rs. 85/ Lamp point/ month subject to a maximum of Rs. 850 /service connection/month

Population = >1 Lakh

Rs. 7.05/ unit

Rs. 105/ Lamp point/ month subject to a maximum of Rs. 2100 /service connection/month

AGRICULTURE (Metered and Flat Rate) (LT-4) Particulars

Approved Tariff Metered (AG/MS/LT-4)

Agriculture Supply (i) General (getting supply in block hours) (ii)All others not covered under items (i) and getting supply more than block hours Flat/ unmetered (AG/FR/LT-4)

Energy Charges

Fixed Charges

Rs. 4.75 /unit

Rs.15 per HP per Month of SCL

Rs. 6.05 /unit

Rs.30 per HP per Month of SCL

(i)General (getting supply in block hours)

Rs. 635 HP /Month

Rs.15 per HP per Month of SCL

(ii)All others not covered under items (i) above and getting more than block hour supply

Rs. 765 HP /Month

Rs.30 per HP per Month of SCL

SMALL INDUSTRIES (LT-5) Particulars Small Industrial Service (LT-5) (Load not exceeding 18.65 kW (25HP)

Approved Tariff Energy Charges

Fixed Charges

Upto first 500 units

Rs.6.00/ unit

Rs. 65/ HP/ month of sanctioned connected load

Above 500 units

Rs.6.45/ unit

Rs. 65/ HP/ month of sanctioned connected load

MEDIUM INDUSTRIES (LT-6 and HT-3) Particulars

Approved Tariff Energy Charges

Fixed Charges

Page 137 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Particulars

Approved Tariff Energy Charges

Medium Industrial Service (LT-6)

Rs. 7.00/ unit

Medium Industrial Service (HT-3)

Rs. 7.00/ unit

Fixed Charges Rs. 75 per HP per month of sanctioned connected load or Rs. 165 per kVA of Billing Demand per month Rs. 165/ kVA of Billing Demand per month

BULK SUPPLY FOR MIXED LOAD (LT-7 and HT-4) Particulars

Approved Tariff Energy Charges

Schedule ML/LT-7

Rs. 7.00/ unit

Schedule ML/HT-4

Rs. 7.00/ unit

Fixed Charges Rs. 75 per HP per month of sanctioned connected load or Rs. 165 per kVA of Billing Demand per month Rs. 165/kVA of Billing Demand per month

LARGE INDUSTRIES (HT-5) Particulars

SCL above 150 HP &/or having Contract/Maximum Demand above 125 kVA (HT-5)

Approved Tariff Energy Charges

Fixed Charges

Rs. 7.30/ unit

Rs. 185/ kVA of Billing Demand per month

General Note: All existing provisions which are not modified by this order, shall continue to be in force.

Page 138 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Annexure E Power Purchase Quantum and Cost for FY 2016-17 Total Ann ual Fixed Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit

JVVNL

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

AVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost JVV NL (Rs. Cr.)

Net Gener ation (MU)

JdVVNL

Total Fixed Cost (Rs. Cr.)

Total Vari able Cost (Rs. Cr.)

Total Cost AVV NL NL (Rs. Cr.)

9

21

38

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

Total Vari able Cost (Rs. Cr.)

Total Cost JdVVN L NL (Rs. Cr.)

13

11

24

NTPC ANTA GTPS

120

42

2.82

48

17

14

30

34

12

45

28

3.39

18

11

6

17

12

8

4

12

14

9

5

14

DADRI GTPS

194

32

2.71

77

13

21

34

54

9

15

24

62

10

17

27

FGUTTPS -I

60

14

2.97

24

6

7

13

17

4

5

9

19

5

6

10

FGUTTPS -II

132

26

2.95

53

10

16

26

37

7

11

18

42

8

12

21

FGUTPP III

88

22

2.91

35

9

10

19

25

6

7

13

28

7

8

15

F.S.T.P.S

53

6

2.55

21

3

5

8

15

2

4

6

17

2

4

6

K.H.S.T.P.S. I

112

17

2.41

45

7

11

18

31

5

8

12

36

6

9

14

K.H.S.T.P.S. & II

523

85

2.25

209

34

47

81

146

24

33

57

167

27

38

65

RHIND STPS

548

56

1.62

219

22

35

58

153

16

25

40

175

18

28

46

RIHAND II

720

63

1.57

288

25

45

70

202

18

32

49

230

20

36

56

RIHAND III

824

120

1.60

330

48

53

101

231

34

37

71

264

38

42

81

SINGUARLI

2115

126

1.44

846

50

121

172

592

35

85

120

677

40

97

137

AURIYA GTPS

347

85

2.17

139

34

30

64

97

24

21

45

111

27

24

51

NCTPS 2

13

3

3.03

5

1

2

3

4

1

1

2

4

1

1

2

NHPC TANAKPUR HEP

32

11

1.66

13

4

2

6

9

3

1

4

10

3

2

5

SALAL HEP

95

6

1.73

38

2

7

9

27

2

5

6

31

2

5

7

CHAMERA-I

420

38

1.22

168

15

20

36

118

11

14

25

134

12

16

28

CHAMERA-II

148

17

1.05

59

7

6

13

41

5

4

9

47

5

5

10

CHAMERA-III

104

26

2.13

42

10

9

19

29

7

6

13

33

8

7

15

URI HEP

245

21

1.41

98

8

14

22

69

6

10

15

78

7

11

18

URI HEP II

172

47

2.95

69

19

20

39

48

13

14

28

55

15

16

31

KHPS-I

95

16

2.35

38

6

9

15

27

4

6

11

30

5

7

12

DULHASTI

255

66

3.28

102

27

33

60

71

19

23

42

82

21

27

48

PARBATI III

77

17

2.74

31

7

8

15

22

5

6

11

25

6

7

12

DHOLIGANGA

Page 139 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Power Purchase Quantum and Cost for FY 2016-17 Total Ann ual Fixed Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit

JVVNL

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

AVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost JVV NL (Rs. Cr.)

Net Gener ation (MU)

JdVVNL

Total Fixed Cost (Rs. Cr.)

Total Vari able Cost (Rs. Cr.)

Total Cost AVV NL NL (Rs. Cr.)

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

Total Vari able Cost (Rs. Cr.)

Total Cost JdVVN L NL (Rs. Cr.)

55

15

2.35

22

6

5

11

15

4

4

8

18

5

4

9

KTPS(1 to 7)

6628

393

2.54

2651

157

674

831

1856

110

472

582

2121

126

539

665

STPS(1 to 6)

4023

345

3.32

1609

138

534

672

1127

96

374

470

1287

110

427

537

95

9

3.57

38

4

14

17

27

3

9

12

30

3

11

14

CTPP (1&2)

3059

472

1.98

1224

189

242

431

857

132

169

302

979

151

194

345

CTPP (3)

1515

278

2.11

606

111

128

239

424

78

90

167

485

89

102

191

CTPP (4)

1559

246

2.11

624

99

132

230

437

69

92

161

499

79

105

184

432

28

2.91

173

11

50

61

121

8

35

43

138

9

40

49

KaTPP#1

3415

738

2.44

1366

295

333

628

956

207

233

440

1093

236

266

503

KaTPP#2

2116

412

2.44

846

165

206

371

592

115

144

260

677

132

165

297

RGTP 3

936

143

3.09

374

57

116

173

262

40

81

121

300

46

93

138

MAHI

209

43

0.30

83

17

3

20

58

12

2

14

67

14

2

16

MAHI MMH

1

0

3.78

0

0

0

0

0

0

0

0

0

0

0

0

MANGROL

6

0

3.78

2

0

1

1

2

0

1

1

2

0

1

1

STPS MMH

2

0

3.78

1

0

0

0

0

0

0

0

1

0

0

0

5826

1044

1.85

2331

418

431

848

1631

292

301

594

1864

334

345

679

NAPP

328

0

2.58

131

0

34

34

92

0

24

24

105

0

27

27

RAPP-I& II

862

0

2.88

345

0

99

99

241

0

70

70

276

0

79

79

RAPP-III& IV

1073

0

2.87

429

0

123

123

301

0

86

86

343

0

99

99

RAPP-V& VI

528

0

3.53

211

0

75

75

148

0

52

52

169

0

60

60

0

0

0.00

0

0

0

0

0

0

0

0

0

0

0

0

2159

0

0.48

864

0

41

41

605

0

29

29

691

0

33

33

756

0

0.00

302

0

0

0

212

0

0

0

242

0

0

0

SEWA II

STATE GEN. & OTHER RVUN

DCCPP

GLTPP 2 RGTP(1&2)

Rajwest GLTPP

NPCIL

RAPP-V

SHARE PROJECTS BBMB(BHAKRA ,DEHAR&PONG CHAMBAL/SAT PURA

Page 140 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Power Purchase Quantum and Cost for FY 2016-17 Total Ann ual Fixed Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit

JVVNL

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

AVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost JVV NL (Rs. Cr.)

Net Gener ation (MU)

JdVVNL

Total Fixed Cost (Rs. Cr.)

Total Vari able Cost (Rs. Cr.)

Total Cost AVV NL NL (Rs. Cr.)

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

Total Vari able Cost (Rs. Cr.)

Total Cost JdVVN L NL (Rs. Cr.)

122

0

3.99

122

0

49

49

TEHRI

245

70

2.28

98

28

22

50

69

20

16

35

78

22

18

40

KOTESHWAR

106

21

1.90

43

8

8

16

30

6

6

12

34

7

6

13

49

0

2.03

19

0

4

4

14

0

3

3

16

0

3

3

SJVNLNATHPAJHAKRI

555

88

1.40

222

35

31

66

156

25

22

46

178

28

25

53

Rampur

156

31

1.66

62

12

10

23

44

9

7

16

50

10

8

18

1271

309

1.55

508

124

79

203

356

87

55

142

407

99

63

162

9

6

4.94

3

2

2

4

2

2

1

3

3

2

1

3

Coastal Gujerat Adani Power Rajasthan Ltd. Sasan Power Ltd. Karcham Wangtoo

2529

241

1.43

1011

96

145

241

708

67

101

169

809

77

116

193

7871

1193

2.15

3148

477

677

1155

2204

334

474

808

2519

382

542

924

2585

45

1.51

1034

18

156

173

724

12

109

121

827

14

125

139

412

0

5.30

165

0

87

87

115

0

61

61

132

0

70

70

NVVN Bundled

2406

214

3.58

962

86

344

430

674

60

241

301

770

68

275

344

Wind farms

5166

0

4.98

2066

0

1029

1029

1446

0

720

720

1653

0

823

823

Solar

1656

0

4.61

662

0

306

306

464

0

214

214

530

0

244

244

729

0

6.64

291

0

194

194

204

0

136

136

233

0

155

155

25

0

5.00

10

0

5

5

7

0

3

3

8

0

4

4

PTC (DB)

501

131

1.62

200

52

32

85

140

37

23

59

160

42

26

68

PTC (Maruti)

123

22

1.64

49

9

8

17

35

6

6

12

39

7

6

13

RFF

OTHERS

Tala

Other Neyveli Lignite Corporation Ltd Aravali Power Co. Pvt. Ltd.

NCES

Biomass

NEW STATIONS

BHADLA-II

Page 141 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Power Purchase Quantum and Cost for FY 2016-17 Total Ann ual Fixed Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit Short term

-3405

Total

66229

4.00 7524

JVVNL

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

-2107 25820

3010

AVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost JVV NL (Rs. Cr.)

Net Gener ation (MU)

-843

-843

-1343

6112

9147

18120

Total Fixed Cost (Rs. Cr.)

2107

JdVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost AVV NL NL (Rs. Cr.)

-537

-537

44

4327

6422

22288

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

2408

Total Vari able Cost (Rs. Cr.)

Total Cost JdVVN L NL (Rs. Cr.)

18

18

5577

7971

Page 142 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Annexure F Power Purchase Quantum and Cost for FY 2017-18 Total Ann ual Fixe d Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit

JVVNL

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

AVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost JVV NL (Rs. Cr.)

Net Gener ation (MU)

Total Fixed Cost (Rs. Cr.)

JdVVNL

Tot al Vari able Cost (Rs. Cr.)

Ne t Ge ne r ati on (M U)

Total Cost AVV NL (Rs. Cr.)

Tota l Fixe d Cost (Rs. Cr.)

Tot al Vari able Cost (Rs. Cr.)

Total Cost JdVV NL (Rs. Cr.)

NTPC

120

42

2.87

48

17

14

30

34

12

10

21

38

13

11

24

45

28

3.46

18

11

6

18

12

8

4

12

14

9

5

14

194

32

2.76

77

13

21

34

54

9

15

24

62

10

17

27

FGUTTPS -I

60

14

3.03

24

6

7

13

17

4

5

9

19

5

6

10

FGUTTPS -II

132

26

3.00

53

10

16

26

37

7

11

18

42

8

13

21

FGUTPP III

88

22

2.97

35

9

10

19

25

6

7

13

28

7

8

15

F.S.T.P.S

53

6

2.60

21

3

6

8

15

2

4

6

17

2

4

6

K.H.S.T.P.S. I

112

17

2.45

45

7

11

18

31

5

8

13

36

6

9

14

K.H.S.T.P.S. & II

523

85

2.30

209

34

48

82

146

24

34

57

167

27

38

66

RHIND STPS

548

56

1.65

219

22

36

59

153

16

25

41

175

18

29

47

RIHAND II

720

63

1.60

288

25

46

71

202

18

32

50

230

20

37

57

RIHAND III

824

120

1.63

330

48

54

102

231

34

38

71

264

38

43

82

SINGUARLI

2115

126

1.46

846

50

124

174

592

35

87

122

677

40

99

139

347

85

2.21

139

34

31

65

97

24

21

45

111

27

25

52

13

3

3.09

5

1

2

3

4

1

1

2

4

1

1

2

TANAKPUR HEP

32

11

1.70

13

4

2

6

9

3

2

5

10

3

2

5

SALAL HEP

95

6

1.76

38

2

7

9

27

2

5

6

31

2

5

7

CHAMERA-I

420

38

1.24

168

15

21

36

118

11

15

25

134

12

17

29

CHAMERA-II

148

17

1.07

59

7

6

13

41

5

4

9

47

5

5

10

CHAMERA-III

104

26

2.17

42

10

9

19

29

7

6

13

33

8

7

15

URI HEP

245

21

1.44

98

8

14

22

69

6

10

16

78

7

11

18

URI HEP II

172

47

3.01

69

19

21

40

48

13

15

28

55

15

17

32

95

16

2.39

38

6

9

15

27

4

6

11

30

5

7

12

DULHASTI

255

66

3.35

102

27

34

61

71

19

24

42

82

21

27

49

PARBATI III

77

17

2.80

31

7

9

16

22

5

6

11

25

6

7

13

SEWA II

55

15

2.40

22

6

5

11

15

4

4

8

18

5

4

9

ANTA GTPS AURIYA GTPS DADRI GTPS

KHPS-I NCTPS 2

NHPC

DHOLIGANGA

Page 143 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Power Purchase Quantum and Cost for FY 2017-18 Total Ann ual Fixe d Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit

JVVNL

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

AVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost JVV NL (Rs. Cr.)

Net Gener ation (MU)

Total Fixed Cost (Rs. Cr.)

JdVVNL

Tot al Vari able Cost (Rs. Cr.)

Ne t Ge ne r ati on (M U)

Total Cost AVV NL (Rs. Cr.)

Tota l Fixe d Cost (Rs. Cr.)

Tot al Vari able Cost (Rs. Cr.)

Total Cost JdVV NL (Rs. Cr.)

STATE GEN. & OTHER RVUN KTPS(1 to 7)

6628

405

3.02

2651

162

802

964

1856

113

561

675

2121

130

641

771

STPS(1 to 6)

4023

344

3.81

1609

138

613

750

1127

96

429

525

1287

110

490

600

95

9

3.43

38

3

13

16

27

2

9

12

30

3

10

13

CTPP (1&2)

3059

456

2.38

1224

183

291

474

857

128

204

332

979

146

233

379

CTPP (3)

1515

273

2.31

606

109

140

249

424

76

98

175

485

87

112

200

CTPP (4)

1559

246

2.31

624

98

144

243

437

69

101

170

499

79

115

194

GLTPP 2

0 432

28

1.84

173

11

32

43

121

8

22

30

138

9

25

34

KaTPP#1

3415

705

2.56

1366

282

349

631

956

197

245

442

1093

225

280

505

KaTPP#2

2116

395

2.55

846

158

216

374

592

111

151

262

677

126

173

299

RGTP 3

936

137

3.07

374

55

115

170

262

38

81

119

300

44

92

136

MAHI

209

45

0.30

83

18

3

21

58

13

2

14

67

15

2

17

MAHI MMH

1

0

3.78

0

0

0

0

0

0

0

0

0

0

0

0

MANGROL

6

0

3.78

2

0

1

1

2

0

1

1

2

0

1

1

STPS MMH

2

0

3.78

1

0

0

0

0

0

0

0

1

0

0

0

5826

1121

2.09

2331

448

487

935

1631

314

341

655

1864

359

389

748

0

0

1.00

0

0

0

0

0

0

0

0

0

0

0

0

328

0

2.63

131

0

34

34

92

0

24

24

105

0

28

28

DCCPP

RGTP(1&2)

Rajwest GLTPP

NPCIL NAPP

862

0

2.94

345

0

101

101

241

0

71

71

276

0

81

81

RAPP-III& IV

1073

0

2.93

429

0

126

126

301

0

88

88

343

0

101

101

RAPP-V& VI

528

0

3.60

211

0

76

76

148

0

53

53

169

0

61

61

2159

0

0.49

864

0

42

42

605

0

30

30

691

0

34

34

756

0

0.00

302

0

0

0

212

0

0

0

242

0

0

0

RAPP-I& II

0

RAPP-V

SHARE PROJECTS BBMB(BHAKRA, DEHAR&PONG CHAMBAL/SATP URA

Page 144 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Power Purchase Quantum and Cost for FY 2017-18 Total Ann ual Fixe d Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit

JVVNL

Net Gener ation (MU)

Total Fixe d Cost (Rs. Cr.)

AVVNL

Total Vari able Cost (Rs. Cr.)

Total Cost JVV NL (Rs. Cr.)

Net Gener ation (MU)

Total Fixed Cost (Rs. Cr.)

JdVVNL

Tot al Vari able Cost (Rs. Cr.)

Ne t Ge ne r ati on (M U)

Total Cost AVV NL (Rs. Cr.)

Tota l Fixe d Cost (Rs. Cr.)

Tot al Vari able Cost (Rs. Cr.)

Total Cost JdVV NL (Rs. Cr.)

122

0

4.07

122

0

50

50

0

0

0

0

0

0

0

0

TEHRI

245

70

2.33

98

28

23

51

69

20

16

35

78

22

18

41

KOTESHWAR

106

21

1.93

43

8

8

17

30

6

6

12

34

7

7

13

49

0

2.07

19

0

4

4

14

0

3

3

16

0

3

3

SJVNL-NATHPAJHAKRI

555

88

1.43

222

35

32

67

156

25

22

47

178

28

25

54

Rampur

156

31

1.69

62

12

11

23

44

9

7

16

50

10

8

18

1271

309

1.58

508

124

80

204

356

87

56

143

407

99

64

163

9

6

5.04

3

2

2

4

2

2

1

3

3

2

1

3

Coastal Gujerat Adani Power Rajasthan Ltd. Sasan Power Ltd. Karcham Wangtoo

2529

241

1.46

1011

96

148

244

708

67

103

171

809

77

118

195

7871

1193

2.19

3148

477

691

1168

2204

334

484

818

2519

382

553

934

2585

45

1.54

1034

18

159

177

724

12

111

124

827

14

127

141

412

0

5.40

165

0

89

89

115

0

62

62

132

0

71

71

NVVN Bundled

2406

214

3.76

962

86

362

447

674

60

253

313

770

68

289

358

Wind farms

5016

0

4.98

2007

0

999

999

1405

0

699

699

1605

0

799

799

Solar

2906

0

4.61

1162

0

536

536

814

0

375

375

930

0

429

429

795

0

6.64

318

0

211

211

223

0

148

148

254

0

169

169

25

0

5.00

10

0

5

5

7

0

3

3

8

0

4

4

PTC (DB)

501

131

1.65

200

52

33

86

140

37

23

60

160

42

26

68

PTC (Maruti)

123

22

1.67

49

9

8

17

35

6

6

12

39

7

7

13

Short Term

-3273

4.00

-2883

-1153

-1153

-1632

-653

-653

1243

497

497

RFF

OTHERS

Tala

Other Neyveli Lignite Corporation Ltd Aravali Power Co. Pvt. Ltd.

NCES

Biomass

NEW STATIONS BHADLA-II

Page 145 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

Power Purchase Quantum and Cost for FY 2017-18 Total Ann ual Fixe d Vari Net char able Source of Gener ges Cost Power(Statio ation (Rs (Rs./ n wise) (MU) Cr.) unit Total

67529

7536

2.61

JVVNL

Net Gener ation (MU) 25511

Total Fixe d Cost (Rs. Cr.) 3014

AVVNL

Total Vari able Cost (Rs. Cr.) 6425

Total Cost JVV NL (Rs. Cr.) 9466

Net Gener ation (MU) 18158

Total Fixed Cost (Rs. Cr.) 2110

JdVVNL

Tot al Vari able Cost (Rs. Cr.) 4648

Total Cost AVV NL (Rs. Cr.) 6746

Ne t Ge ne r ati on (M U)

Tota l Fixe d Cost (Rs. Cr.)

23860

Tot al Vari able Cost (Rs. Cr.) 2412

Total Cost JdVV NL (Rs. Cr.) 6555

Page 146 of 146 Petition No. RERC 1077/17, 1078/17, 1076/17

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