JERC approves electricity tariff hike in J&K
21% increase for non-metered consumers, over 13% hike for metered areas
The Biz Reporter Exclusive
Srinagar, Oct 13: The Joint Electricity Regulatory Commission (JERC) of J&K and Ladakh has approved the power tariff hike for the current financial year for the consumers on the ground of gradually reducing the annual cost of supply of power and the annual revenue requirement gap.
The commission has approved over 21 percent tariff hike for non-metered consumers while for metered consumers, the average hike is over 13 percent.
According to the tariff schedule, metered consumers would experience a rate increase for 0-100 units of power an 18 percent increase, 9 percent increase from 101 to 200 units, 6 percent increase from 201 to 400 units, and 8 percent increase over 400 units.
Up to 100 units per month, the cost of energy was Rs 1.69 and from 101 to 200 units, the rate was Rs 2.2.
Now, under the amended tariff, up to 200 units of electricity would be charged Rs 2 per unit and 201-400 units would now be charged Rs 3.5 per unit instead of Rs 3.30 and beyond 400 units would now be charged Rs 3.8 per unit instead of Rs 3.52 previously.
Similarly, the flat charge up to 1/4 kilowatt per month in unmetered areas would now be Rs 175 instead of Rs 99 previously. Over 1/4 or 1/2 kilowatt will cost Rs 400 compared to earlier Rs 325, 3/4 kilowatt and above would cost Rs 600 instead of the current rate of Rs 495 while for up to 1 kW and above 3/4 Kw the rate will be Rs 800 instead of the current rate of Rs 650.
“The commission has reviewed the tariff proposal of JPDCL and KPDCL and noticed that after a proposed increase in tariff (JPDCL: 30 percent and KPDCL: 26percent) as requested by the petitioners, there would be still a revenue gap that is the proposed tariff hike would not be able to cover entire revenue gap and there will be unmet revenue gap. The petitioners have not submitted any proposal to meet the remaining revenue gap after the proposed tariff hike,” reads a JERC’s order. “The committee has observed that if the unmet revenue gap is to be met by increasing the tariff in the Jammu license area and Kashmir license area uniformly, then there will be around a 78 percent hike in present tariff which will be tariff shock for all categories of the consumers in J&K.”
The order read that the commission noted that a trajectory for reduction of AT&C losses upto 15 percent by FY 2019-20 was fixed by erstwhile JKSERC for the turnaround of the power sector under the UDAY scheme.
“Further, a similar target of AT&C loss reduction has been envisaged under the Ministry of Power scheme and revamped reforms-based and results-linked distribution sector scheme (RDSS),” it read. “To achieve the targeted AT&C loss level as envisaged under RDSS scheme, the petitioners have to take the necessary steps to arrest the distribution loss in its supply area. Considering the fact that is the first year of operation of the petitioners after the restructuring of JKPDD, the commission has taken a liberal approach and considers the appropriate normative distribution loss level for FY2022-23. The petitioners should take immediate action to curb the high losses observed in their area of supply. The actual losses cannot be considered and inefficiencies cannot be passed on to the consumers.”
The order reads that the commission has observed that the present retail supply tariff effective in the J&K is the tariff determined by the erstwhile JKSERC during FY 2016-17 for JKPDD and since then there is no tariff revision in J&K for the last 6 years.
It said that the commission notes that restructuring and unbundling of JKPDD into various power utilities to look after generation, transmission and distribution business in J&K and Ladakh primarily aims towards initiating reform in the power sector to enable self-reliant and cost-efficient operation of these corporations in generation, transmission, and distribution business in the future.
“It is therefore imperative that the financial support and grant-in-aid made available to such utilities during the initial stage needs to be gradually phased out over a period and the revenue requirement to run the business of these utilities shall be met through the tariff charged to the consumers,” the order read.
