MAHARASHTRA ELECTRICITY REGULATORY
COMMISSION
13th floor, Centre No.1, World Trade Centre,
Cuffe Parade, Mumbai 400 005.
Tel. 22163964 / 22163965, Fax No. 22163976
E-mail mercindia@mercindia.com
Website: www.mercindia.com
CASE No. 4 of 2004
In the matter of
Annual Revenue Requirement
(ARR) and Tariff of BEST.
Shri P. Subrahmanyam, Chairman
Shri Jayant Deo, Member
Dr Pramod Deo, Member
INTERIM ORDER
Dated: 19th July, 2004.
In
its Order dated 7th April 2004 in Case No. 6 of 2003, the
Brihanmumbai Electric Supply and Transport Undertaking (BEST) were directed "to
submit their ARR for the year 2004-05 within a period of two months on
affidavit, along with supporting material and justification relating it to
their tariff (and/or proposed tariff in case they seek a change) and the
provisions of law.”
2. BEST
have filed a Petition on 21st May, 2004 seeking review of the Commission's
Order dated 7th April, 2004 in Case No. 6 of 2003. That Petition has yet to be admitted, and thus has no bearing on
the present matter at this stage. The
Commission also notes that, even before the final Order in that case, under
letters dated 8th September, 2003 and 30th September, 2003 the Commission had
asked BEST to comply with directions given at the hearing held on 5th June,
2003 to file their ARR and show how their tariff meets the legal provisions,
but without response.
3. Under
their letter dated 17th June, 2004, while mentioning the Review Petition filed
by them, BEST sought extension of time
for complying with the above directions, stating that:
"We have to inform you that the preparation of ARR is a
matter requiring expertise for which a consultant is being appointed by the
BEST. This is the first time that an
ARR is being prepared by the BEST and it would be difficult to prepare the ARR
without the help of any consultant having experience in this field. Tenders have been invite and the same have
been opened on 8.06.2004. Since the
process will take some time and since the ARR that would be prepared would
require in-puts and other information from all the departments of the
Undertaking as may be required by the consultant, the process is likely to be delayed
for at least 2-3 months. In view of the
above, it is requested that the time for filing the ARR may be extended for a
further period of three months to enable the BEST to file its ARR before the
Commission."
4. In
the meantime, in its detailed Order dated 11th June, 2004 (preceded by its
operative Order dated 1st June, 2004) in Case No. 30 of 2003 determining the
tariff of the Tata Power Company Ltd. (TPC), the Commission had reduced the
tariff charged by TPC for bulk supply to BEST.
In the context of passing on the benefit to BEST's consumers, the
Commission decided to hear BEST on their application requesting further time
for compliance.
5. During
the hearing held on 6th July, 2004, Shri S.S. Kshatriya, General Manager, BEST
submitted inter alia, that the matter of reduction in BEST's tariff consequent
upon reduction in TPC's tariff to them would be placed before the BEST
Committee, which was meeting shortly, and/or the Brihanmumbai Municipal
Corporation, as may be required, before submission to the Commission
shortly. The General Manager, BEST was
addressed accordingly under letter dated 6th July, 2004, and informed that
BEST's application for extension of time by 3 months to comply with the
Commission's directions in its Order dated 7th April, 2004 was granted subject
to submission of the reduction proposal as above. With this extension of time, BEST are required to make their
filing by 6th October, 2004 (i.e. within 3 months of the Commission's letter
dated 6th July, 2004).
6. In
response, under their letter No. DO/GM/DGM/(ES)/37280/2004 dated 9th
July, 2004, BEST have stated that:
"As per the directive of Commission, w.e.f. 1st
July, 2004 BEST will charge proportionately less Fuel Adjustment Charges (FAC),
to its consumers, on the basis of the reduction in TPC’s energy bill to BEST
for the month of June, 2004. It is proposed to continue to pass on the above
benefit to our consumers on month to month basis till BEST’s tariff is revised,
as conveyed to the Commission in the meeting dated 6th July, 2004.
The necessary approval of BES&T Committee has been obtained in
the Committee Meeting held on 8th July, 2004 for the proposal. A
copy of BCR 127 dated 8th July, 2004 is enclosed herewith. The
approval of Municipal Corporation is not required as basic tariff rates of BEST
remain unchanged in the above exercise.”
The proposal placed
before the BEST Committee and submitted to the Commission states that:
"It is, therefore, proposed to reduce the Fuel Adjustment
Charges being levied to the consumers on month to month basis under the Clause
1(a) and 1(b) of foot note of existing Schedule of Electricity Tariff approved
by the BES&T Committee and the Corporation. This works out to 72 paise / unit as the Fuel Adjustment Charges
as per TPC's bill for June, 2004 as against the existing Fuel Adjustment
Charges of Rs 1.12 / unit. Thus, for
the month of June, 2004, the BES&T Undertaking would pass on the benefit of
approximately Rs 13 Crores to the Consumers.
Similar exercise would be done every month."
7. As
an interim arrangement pending the submission and examination of their ARR and
tariff, the Commission accepts the above action proposed by BEST.
8. The
Commission further directs BEST to keep a detailed month-wise account of such
benefit passed on in respect of each consumer category, and also include the
same in their ARR proposal so as to enable it to consider its effect during the
ARR approval and / or tariff determination process.
| Sd/- | Sd/- | Sd/- | |
| (Jayant Deo) | (Dr Pramod Deo) | (P. Subrahmanyam) |
|
| Member | Member | Chairman, MERC |
|
Sd/- |
|||
| (A.M. Khan) | |||
| Secretary, MERC | |||
|
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