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UP Purchasing Power At Exorbitant Rates From Pvt Companies

 Agencies |  2017-06-22 14:30:14.0  0  Comments

UP Purchasing Power At Exorbitant Rates From Pvt Companies

Lucknow: Uttar Pradesh Power Corporation Limited has been purchasing power at exorbitant rates from private companies, said four main power companies in their Annual Revenue Requirement (APR), a day after the companies claimed that they were facing huge financial losses. Bajaj Hindustan would sell worth Rs 1,773-crore of power to these companies at a rate of Rs 7.22 a unit while Reliance Power will sell it at Rs 5.04 a unit. In the ARR, the four power companies -- Poorvanchal, Madhyanchal, Dakshinchal and Pachimanchal -- would purchase power worth Rs 52,919-crore during 2017-18 of which Rs 25,475-crore electricity would be purchased from the private companies. In the ARR, these power companies have given their purchase detail for 2017-18 with required finances to purchase the power of 1,28,908-million units at the cost of Rs 52,919-crore to meet the demand of consumers. The average rate of the power to be purchased is Rs 4.11 a unit. The power companies will purchase 57,580-million units from the private generation companies worth Rs 25,457-crore. However, the rate of the private generation companies is above Rs 5 a unit. The highest of Rs 7.22 a unit is of Bajaj Hindustan who will sell power worth Rs 1,773-crore. Reliance Power will sell power at the rate of Rs 5.03 per unit of Rs 2,046-crore while its second unit will sell at the rate of Rs 5.04 a unit of Rs 2,047-crore. The Lalitpur unit of the Bajaj group will sell at the rate of Rs 5.04 per unit of Rs 4,730-crore while the Srinagar power project will sell at the rate of Rs 5.84 per unit of Rs 663-crore. But on the other hand these power companies will purchase 2,507-million units from the power exchange and through bi-lateral agreement which will be at the rate of just Rs 3.80 per unit. Surprisingly, Union Power Minister Piyush Goel always speaks of low rate in the power exchange even during the peak hours, but purchase of high rate of electricity from private companies would certainly raise question on these power companies. However, officials said the UPPCL is bound to purchase the power of the private generation companies due to power purchase agreement clauses. UP Rajya Vidyut Upbhokta Parishad president Awadhesh Kumar Verma in a statement here today said that his Council had always opposed the MoUs signed between the government and private companies. Yesterday, the four power distribution companies, all subsidiaries of the UPPCL filed the ARR with the power regulator for the current fiscal 2017-18. The fifth power discom Kanpur electricity supply company is also expected to file the ARR soon. Officially, no one of the four discom have sought hike in power tariff. The huge cash loss and 16 per cent return on equity (ROE) sought by the four discoms has left the UP state electricity regulatory commission but to order steep hike in power tariff as high as 25 per cent. The power tariff was last revised by 5.47 per cent for all categories of power consumers in June 2015. Official sources here said the four discom have shown ARR of Rs 68,674-crore during 2017-18. The net cash loss without the state government subsidy is Rs 20,618-crore. If the annual subsidy of Rs 5,500-crore from the State Government is adjusted then the net cash gap is Rs 15,118-crore. Besides the cash loss, the four discoms also want the tariff to be hiked to bridge the cash loss due to 19 per cent transmission and distribution losses. Moreover for the first time since inception in year 2000 the discoms have sought 16 percent return on investment. If the ARR by the five discoms is allowed by the power regulator then it will have to order at least 25 per cent hike in power tariff for the current fiscal 2017-18. UNI

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