No tariff hike in Delhi; DERC rejects power discoms’ demands

Last Updated: Monday, May 31, 2010 - 20:35

New Delhi: Hardening its position in the
ongoing face off over the power tariff dispute, Delhi`s power
regulator DERC has shot off letters to all three private
discoms rejecting point-by-point all their arguments demanding
an increasing in the rates.

The Delhi Electricity Regulatory Commission also sent
a letter to the government, believed to be sympathetic to the
demands by the discoms, strongly objecting to any hike in
tariff.

The letters to discoms as well as to the government
from the DERC came days after a top official in the Chief
Minister`s office said genuine demands of the discoms must be
addressed by the regulator while finalising the new
electricity rates.

In its letter to Tata-backed discom NDPL, the DERC
said the company made a profit of Rs 468.82 crore in 2009-10
which increased from 169.60 crore in 2004-05, an increase of
176 per cent.

The regulator also charged NDPL of giving "figures
without any basis" in its representation to the government
demanding a hike while "ignoring the fact that the audited
accounts for 2009-10 showed a cash profit of Rs 468.82 crores.

Also rejecting the discom`s contention that banks have
refused to lend money to the company for its poor financial
position, DERC said credit rating agency ICRA has given NDPL
high credit quality rating for its healthy financial position.

"The positive credit profile also favourably factors
in the stable demand growth and low level of business risks in
its core operations` and its improving financial risk
profile," it said.

Exercising a special power under Delhi Electricity
Act, the city government after receiving a representation from
the discoms had on May 4 -- a day before the scheduled
announcement of the tariff order -- directed DERC not to
announce it till the regulator got the go-ahead from it.

The DERC after receiving the government directive had
indicated that it had planned to cut down the tariff by 20 to
25 per cent as discoms would have a surplus of around Rs 4,000
crore if the existing tariff was not tinkered with.

In its letter to BSES Yamuna Power Ltd, DERC said the
company made "highest cash profit of Rs 157.33 Crore in
2009-10 which increased from 16.89 Crore in 2007-08".

The DERC also accused BYPL of misrepresenting facts
not giving proper figures in its representation to Delhi
government seeking hike in tariff.

"Despite good financial position of your company and
fairly good credit rating, you have chosen to say, in your
representation, that your net worth is negative," DERC said in
the letter.

A similar letter was sent to BSES Rajdhani Power Ltd
also by the DERC.

PTI



First Published: Monday, May 31, 2010 - 20:35

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