Stage set for increase in power tariff?

Be ready to loosen your purse strings further as the stage is almost set for a hike in power tariff in the national capital.

Updated: Apr 30, 2010, 23:47 PM IST

New Delhi: Be ready to loosen your purse
strings further as the stage is almost set for a hike in power
tariff in the national capital.

The indication to this effect has already been given
by Chief Minister Sheila Dikshit when she said people have
money to pay more for power.

Delhi`s power regulator DERC has finalised a new
tariff order for the 2010-11 after completing scrutiny of
balance sheets of discoms which have been demanding a 40 per
cent hike in tariff.

Citing financial crunch due to heavy spending on
Commonwealth Games project, Delhi Government had in the last
six months hiked bus fares, water tariff, withdrew subsidy on
LPG cylinders and increased VAT on a number of items.
The government last year had withdrawn power subsidy
for certain categories of consumers to save around Rs 1,000

As per indication, the DERC may not burden those
consumers whose monthly consumption does not exceed 300 MW and
significantly hike tariff for higher consumption. Sources said
government may also totally do away with the subsidy being
given to those whose monthly consumption is less than 150 MW.
They said, however, the hike will not be "too much" as
demanded by the discoms. Reliance Infrastructure-backed discom
BSES in its tariff petition had demanded a tariff hike of 60
per cent citing increasing cost of buying power from the power

Officials in the power department are learnt to have
opposed any substantial hike arguing the discoms will no
longer require to buy power from the open market once the
under construction power plants at Bawana and Dadri start
generating power.

Power Secretary Rajinder Kumar said Delhi will get an
additional 750 MW from Jhajjar power plant from November-end
while around 800 MW will be available from the Dadri plant,
which will start generation from July. He said government is
expecting another 400 MW from Damodar Valley power plant in
West Bengal by May-end.

The argument for not increasing the tariff is that
Delhi will become a power surplus state by the end of this
year and then discoms will not require to buy power from open

Currently Delhi`s power demand ranges from 3,700 MW to
4,100 MW. The city gets 2,200 MW from central quota while
nearly 1,000 MW is produced by Delhi`s own generating
stations. The discoms have to procure around 800 MW to 1,000
MW of power from the open market.
Last week Union Power Ministry had granted an
additional quota of 100 MW power to the city to meet the
rising demand.

Despite the demand by the discoms, the DERC last year
had not increased power tariff in the city.