Customer Support > FAQ's
1. Brijender Singh’s tariff order that reduce tariffs by 23% should be implemented
- This matter was contested in a PIL case (Nand Kishore Garg V/s. Govt. of NCT of Delhi and Others) before Hon’ble Delhi High Court.
- Shri Prashant Bhushan was also party to this and the issue has been conclusively settled by the Hon’ble court, vide its judgment on May 23, 2011.
- After hearing the detailed arguments, the Hon’ble Court ruled, that there was no tariff order as such. The order said,…“The notings on the files by the Commission do not constitute an “Order” under the 2003 Act”.
- Also the order said, “……The Commission shall proceed afresh by following the due procedure and do the needful and not afford any kind of opportunity for criticism and determine the tariff”.
- Note: Matter has already been addressed in detail by DERC in its Tariff Order dt. 26th Aug’ 2011 during a formal media briefing & press release.
2. Allegation of projected surplus and projected rates Vs actual surplus and actual rates
(Case of Rs 3,577 cr. all the plants were commissioned well on time and supplying power (Mr Dutta, a power expert)
- “Artificial surplus” was purely based upon the findings of Mr Brijender Singh who assumed fake surplus of 20111 MUs to be sold @ Rs 5.75/ KWH (as against the average power procurement by the utilities @ Rs 3.25/ KWH) i.e at profit of Rs 2.50 pu.
- Surplus was expected from the following plants during FY 11 which never came up as per schedule.
- Chandrapura (2x250 MW)
- Mejia TPS Ph-II (2x500 MW)
- Maithon TPS (2x250 MW)
- Koderma TPS (2x500 MW)….Not commissioned till even today.
- Durgapur TPS (2x500 MW)… Not commissioned till even today.
- NTPC Jhajjar (500 MW)
- Pragati-III (2x750 MW)
- Rithala (90 MW)
- There was apparent delay in commissioning of these new stations, hence, as against a projection of 20811 MUs surplus, actual availability of surplus was 5826 MUs only.
- CERC notified revision of benchmark for operating frequency as 49.5 Hz along with penal rate of Rs. 12.22/kWh for overdrawal by violating the specified limit, which resulted in drastic reduction in rates of UI power and power sold through exchanges.
- Both Quantity & Price as fallaciously assumed by Mr Brijender Singh, did not happen in reality.
- Commissinong date of all plants is a matter of record in public domain. Similarly, Quantum of power available is recorded by SLDC (state load dispatch centre) independently and also a matter of public record.
- Power transactions taking place in the open market are transparently available and can be crossed verified independently.
- Therefore, non-availability of power from new generating stations and drastic reduction in rates of UI power and power sold through exchanges, nullified the unrealistic assumptions by then Chairman DERC.
- Surplus assumed by Mr Brijender Singh was only 25% of the assumed quantum, hence the projections were much away from reality.
- These clearly establish that the estimates of the commission under the Chairmanship of Shri Bijendra Singh were way off the mark.
3. BSES procuring through Reliance Energy Trading Limited (RETL), loss of Rs 58.6 cr
- 100% of the discom procurement is sourced through govt. run plants (NTPC/ NHPC etc) at prices governed by CERC/ DERC. 70% of BSES requirement is fulfilled mainly through NTPC.
- To maintain 24*7 power supply obligations owing to wide seasonal fluctuations in Delhi city, discoms resort to short term trading through UI, Exchange & Banking for meeting their peak summer shortages & winter surplus disposals.
- RETL is one of amongst dozen licensed traders in open market who work on behalf of both the buyer and the seller and earn a regulated trading margin which is capped at 4 paise only.
- These short term transactions are mere 5% of the total discom transactions.
- RETL handled < 15% of the overall short term transactions done for BRPL.
- As a rule, the rates of sales and purchase are totally market driven and the trader has no role in any active price determination.
4. Discoms showed ‘0’ load and revenue from DJB and DIAL
- Both DJB & DIAL are our premium customers.
- All the bills generated so far are available for any kind of checks what-so-ever.
- DERC’s order for dt. 28th May’ 2009 was a bit late and created a separate Tariff category for DIAL and DJB. Prior to this, these were being billed under Non-domestic category.
- Therefore consumption and corresponding revenue of DJB and DIAL were shown in the Non-Domestic Category tables in FY 2008-09.
- Subsequently, after creation of separate Tariff Category the Consumption and units of DIAL and DJB were indicated separately as per the applicable Tariff Schedule.
5. Related party transactions.
REL bought the equipment for around Rs 800 crore but sold to BSES for around Rs 1428 crore (Information gathered from VAT records)
- REL is one of the largest & reputed EPC contractor in the country.
- All REL transactions were carried out through Transparent & competitive bidding procedure at arm’s length basis (where ABB, Alstom, L&T etc. also participated). All details were duly reported in the Annual Reports of the company under Related Party Transactions.
- The orders of Mr Brijender Singh were disagreed by remaining members who issued dissent note, which was ultimately superseded by Mr Singh by casting veto right.
- This matter was appealed by the company before the Hon’ble Appellate Tribunal for Electricity (ATE) and came out in our favour.
- ATE held that prices allowed by DERC for same equipment to other Discoms should be considered for BSES Discoms. The prices at which BSES has purchased the goods were considerably lower than similarly placed Discoms.
- DERC chose to appeal against the Order of ATE in the Supreme Court and the matter is pending before the Court. DERC has yet not implemented the Order of ATE though there is no formal stay.
6. 10% consumers had ‘O’ billing
(A sample check was conducted on 15,000 consumers & 1500 cases were found.)
- BSES has been able to increase it’s customer base to ~ 32 lacs (from ~18 lacs in 2002) owing to expanding it’s network by bringing more customers in the billing net.
- During this journey BSES has generated ~20 cr bills with 99.99% accuracy.
- There is no instance what-so-ever for a single customer going without any bill.
- If BSES would bot have been billing customers, the huge loss reduction witnessed by Delhi could not have happened.
- During FY 2010-11, world class SAP was implemented for the first time by BSES Discoms for billing all its consumers which is the first of its kind initiative in the country.
- While implementing the same, for some consumers (around 75 consumers out of 15 Lakh consumers, i.e., 0.005% cases), were found with certain billing discrepancies due to manual error. However none of the erroneous bills were dispatched to any consumer.
- Subsequently, this was detected during the Internal Audit Process and appropriate adjustments in SAP were made during the month of Feb & Mar 2011.
Audit Report has already been submitted to DERC.
7. AT&C Losses decreased during Brijendar Singh’s time, but are increasing in Sudhakar’s tenure (eg. Alaknanda and Hauzkhas). These are all artificial losses shown by BSES.
- AT&C Loss reduction has been consistent year over year since past 10 yrs.
- There has been ~40% loss reduction since privatization, which is ten times more when compared to National avg. yearly AT&C loss reduction for India.
- Division wise losses sometimes fluctuate due to refinement of feeder allocations within the discom.
- The operational efficiency of discoms has saved ~ Rs 30,000 crs in past 10 years which ultimately helped Delhi govt. by reduced subsidy burden and customers via lesser tariffs.
- Above all, Hon’ble Supreme court has expressed satisfaction about the much improved Power situation in Delhi after privatization.
8. CAG Issue
- At present the CAG has no authority to audit the accounts of private companies in view of the clear provisions contained under Article 149 of the Constitution of India.
- The various provisions of the CAG Act, 1971, clearly set out the duties and powers of the CAG are with respect to audit of accounts of Union States and Government Companies / Corporations. These powers do not extend to private companies.
- Subsequent to transfer of management control to discoms in 2002, CAG categorically confirmed stating that from July 1, 2002, discoms are not government companies under Section 617 of the companies Act, 1956.
- DERC itself, in its tariff order of 28.05.09, had observed that the private discoms being a company, incorporated under the Companies Act, 1956, presently there is no such provision of CAG audit in respect to private companies.
- Delhi private discoms are governed by the Company’s Act 1956.
- Section 128 of the Electricity Act 2003, empowers the DERC for investigation of certain matters and employment of any auditor or any other person for assisting it in such investigation (Commission enjoys similar powers under the terms of the license granted to the discoms).
- DERC has been exercising these powers to look into the affairs of discoms as and when the need has arisen: for example, physical verification of assets of the discoms by the ASCI, audit of billing software by STQC under the Ministry of Information and Technology, GOI, unwarranted load shedding by an Expert Committee etc.
- BSES has a very robust audit mechanism where prominent auditors (including those empanelled by CAG ) does the statutory audit. Final approval to audited accounts is given by the Board of Directors which also comprises senior officials nominated by GONCTD.
- Adequate checks and balances on the working of discoms are already in place as per provisions of the Companies Act, 1956. DERC also does a very detailed prudence check of all expenses and billing & pre audit of all capital expenditure before discoms can actually incur any such amount.
- Incase the CAG audit is made applicable to private companies, BSES will abide by such direction a direction.
Indirect Auditing of 80% of a discoms expense by the CAG
- Delhi discoms buy power mainly from Central Government Generating Stations, which are subjected to CAG audits. Hence more than 80% of a Delhi discom’s expenses are indirectly subjected to CAG audits.
- The tariff for these generating stations is determined by the CERC and the bills are vetted by the SLDC, an independent systems operator. Moreover, the invoices raised by these stations on the discoms are also scrutinized by the DERC.
- Around 10% of the expenses are towards Operations and Maintenance These undergo a prudence check and undergo scrutiny of the DERC.
- The remaining 10% are towards financial and other costs, which include employee costs – 70% of these are employees still governed by the provisions of the 6th Pay Commission.
9. Proper wiring helps you stays safe!
Faulty Internal wiring, besides being a serious safety hazard can also play havoc with your electricity consumption. Follow these simple dos and don’ts and enjoy years of trouble free living:
- Check your Electronic Meter’s EL LED indicator. Glowing EL LED indicates one or more of the following: (i) Earth is being used as neutral; (ii) Neutral wire is touching the earth wire; (iii) Phase/ Neutral wire is mixed with a neighbours phase / neutral wire.
- Incorrect house wiring may affect electrical safety and can cause fire and mishaps.
- As per Indian Electricity Act, 1956, ensure all electrical work, including addition, alteration and adjustment should be undertaken only by qualified and certified electrical contractors.
- Install an Earth Leakage Circuit Breaker (ELCB). This simple yet very useful device detects Earth Leakage in your house and thereby preventing major mishaps. It is mandatory for consumer, having an electricity load of 5 KW of more to install an ELCB,
- Each independently metered consumer load must be directly connected to the distributing mains, only through its respective meter. If you have more than one meter installed in your building, get a qualified electrician to check that the wiring in the building is segregated.
9. What is the need for a power tariff hike in Delhi?
Delhi, otherwise a successful example of distribution reforms, was a classic example of what is ailing the distribution sector. While the bulk power costs have risen by around 300% in the last 10 years, the retail tariff till now has increased by around just 65%. This virtually non cost reflective retail tariff has led to a huge build up of future receivables (regulatory assets) to the tune of over Rs 19,000 crore, impacting the sustainability of operations for the Delhi discoms.
10. How do Delhi’s power tariffs fare via-a-vis other cities and metros?
- Delhi’s power tariffs continue to be lower than those of NCR towns and other Metros. Moreover, NCR towns have regular load shedding, ranging from 4-8 hours, depending upon the season and power availability.
- Power back-up supplied by diesel generators costs a minimum of Rs 15 per unit after the recent hike in diesel tariffs. After factoring in the load shedding impact, the average Delhi consumer pays half than what his/her counterpart pays in neighboring townships.
Delhi Vs Metros
*includes government subsidy of Rs 1 upto 200 units
Delhi Vs Other States
ncludes government subsidy of Rs 1 upto 200 units
Delhi NCR Towns
Gurgaon / Faridabad
ncludes government subsidy of Rs 1 upto 200 units