FOR FY 2016-17

Submitted by:

Madhya Pradesh Power Management Company Limited

Block no. 15, Shakti Bhawan, Vidyutnagar, Jabalpur

Madhya Pradesh Poorv Kshetra Vidyut Vitaran Company Limited

Block No. 7, Shakti Bhawan, Vidyutnagar, Jabalpur

Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Limited

Bijlee Nagar Colony, Nishtha Parisar, Govindpura, Bhopal

Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Limited

GPH Compound, Pologround, Indore

TRUE UP PETITION

FOR

FY 2016-17

True-up Petition of MP Discoms for FY 2016-17

MPPMCL, East Discom, Central Discom, West Discom P a g e | 1

BEFORE THE MADHYA PRADESH

ELECTRICITY REGULATORY COMMISSION, BHOPAL

Petition No. ________of 2019

(1) Madhya Pradesh Power Management Company Limited (MPPMCL)

Shakti Bhawan, Vidyut Nagar, Jabalpur (MP) ---------

Petitioner

(2) Madhya Pradesh Poorv Kshetra Vidyut Vitaran Company Limited (MPPoKVVCL)

Shakti Bhawan, Vidyut Nagar, Jabalpur (MP) ---------

Petitioner

(3) Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Limited (MPPaKVVCL)

GPH, Polo Ground, Indore (MP) ---------

Petitioner

(4) Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Limited (MPMKVVCL)

Nishtha Parisar, Bijlee Nagar, Govindpura, Bhopal (MP) ---------

Petitioner

IN THE MATTER OF:

Filing up of application for True up of the ARR for FY 2016-17 under the principles laid

down in the “The Madhya Pradesh Electricity Regulatory Commission (Terms and

Conditions for Determination of Tariff for Distribution and Retail Supply of Electricity

and Methods and Principles for Fixation of Charges) Regulations, 2015 (RG-35 (II) of

2015) dated 17th December 2015” by MPPMCL and MPPoKVVCL, MPPaKVVCL &

MPMKVVCL as the Distribution Licensee.

The Petitioners above respectfully submit as under:-

1. Madhya Pradesh Power Management Company Ltd., (hereinafter referred to as the

'Petitioner', MPPMCL, 'the Company' or 'the Licensee'), is a Company incorporated under

the Companies Act, 1956 (now Companies Act 2013) and having its registered office at

Block No.11, Shakti Bhawan, Vidyut Nagar, Jabalpur.

2. Madhya Pradesh Poorv Kshetra Vidyut Vitaran Company Ltd., (hereinafter referred to as

the 'Petitioner', MPPKVVCL, 'the Company' or 'the Licensee' or ‘East Discom’), is a

Company incorporated under the Companies Act, 1956 (now Companies Act 2013) and

having its registered office at Block No.7, Shakti Bhawan, Vidyut Nagar, Jabalpur. The

Petitioner is a deemed licensee under the Fifth Proviso to Section 14 of the Electricity Act,

2003. The area of supply of the Petitioner comprises Jabalpur, Rewa, Sagar and Shahdol

Commissionary within the State of Madhya Pradesh ('MP').



3. Madhya Pradesh Paschim Kshetra Vidyut Vitaran Company Ltd., (hereinafter referred to

as the 'Petitioner', MPPaKVVCL, 'the Company' or 'the Licensee' or ‘West Discom’), is a

Company incorporated under the Companies Act, 1956 (now Companies Act 2013) and

having its registered office at GPH, Polo Ground, Indore. The Petitioner is a deemed

licensee under the Fifth Proviso to Section 14 of the Electricity Act, 2003. The area of

supply of the Petitioner comprises Indore and Ujjain Commissionary within the State of

Madhya Pradesh ('MP').

4. Madhya Pradesh Madhya Kshetra Vidyut Vitaran Company Ltd. (MPMKVVCL),

(hereinafter referred to as the 'Petitioner', MPMKVVCL, 'the Company' or 'the Licensee' or

‘Central Discom’), is a Company incorporated under the Companies Act, 1956 (now

Companies Act 2013) and having its registered office at Nishtha Parisar, Bijlee Nagar

Colony, Govindpura, Bhopal. The Petitioner is a deemed licensee under the Fifth Proviso

to Section 14 of the Electricity Act, 2003. The area of supply of the Petitioner comprises

Bhopal, Gwalior, Hoshangabad and Chambal Commissionary within the State of Madhya

Pradesh ('MP').

5. The Government of Madhya Pradesh (‘GoMP or ‘State Government’), vide an Order No.

3679 FRS-18-13- 2002 dated 31stMay, 2005, published in the gazette of Madhya Pradesh

dated 31st May 2005, have restructured the functions and undertakings of Generation,

Transmission, Distribution and Retail Supply of electricity earlier carried out by the

Madhya Pradesh State Electricity Board (‘MPSEB’ or the ‘Board’) and transferred the

same to five Companies to function independently. The five Companies are as under: -

1) M.P. Power Generating Company Ltd., Jabalpur (MPPGCL) / (GENCO)

2) M.P. Power Transmission Company Ltd., Jabalpur (MPPTCL) / (TRANSCO)

3) M.P. Poorv Kshetra Vidyut Vitaran Company Ltd., Jabalpur (MPPKVVCL) /

(EAST DISCOM)

4) M.P. Madhya Kshetra Vidyut Vitaran Company Ltd. Bhopal (MPMKVVCL) /

(CENTRAL DISCOM)

5) M.P. Paschim Kshetra Vidyut Vitaran Company Ltd., Indore (MPPKVVCL) /

(WEST DISCOM)

6. With the issuance of the said Order dated 31st May 2005, the Operation and Management

Agreement that existed between MPSEB and the Five Companies came to end with effect

from 1st June 2005. The three Vidyut Vitaran Companies viz. East Discom, Central

Discom and West Discom, started functioning independently as Distribution Licensees in

their respective area of license and from the said date are no longer operating as an agent

of or on behalf of the Board, subject to Cash Flow Mechanism (CFM) provided in the said

Order.

7. On 3rd June 2006, GoMP, in exercise of its powers under Section 23 (Sub-section (1), (2)

and (3)) and Section 56 (Sub-section (2)) of Madhya Pradesh Vidyut Sudhar Adhiniyam,

2000 read with Section 131 (Sub-sections (1), (2), (5), (6) and (7) of Electricity Act, 2003,

effected the transfer of and vesting of the functions, properties, interests rights and



obligations of MPSEB relating to the Bulk Purchase and Bulk Supply of Electricity in the

State Government and simultaneously re-transferred and re-vested the same to MP Power

Trading Company (‘Tradeco’ or 'MP Tradeco'). Since then, MP Tradeco is discharging

the responsibilities of procurement of power in bulk and supplying to the three Discoms,

including the Petitioner herein. The transfer was effected through “M.P. Electricity

Reforms Transfer Scheme Rules 2006” (Transfer Scheme Rules) vide Notification

No.3474 /FRS/17/XIII/2002 dtd. 3rd June 2006 (Transfer Scheme Rules).

8. In accordance with GoMP decision the name of MP Power Trading Company Ltd has been

changed to MP Power Management Company Ltd. The MP Power Management Company

has been made holding companies for all the three discoms of MP. The Registrar of

Companies, MP has issued the Certificate of Incorporation consequent upon change of

name on 10.04.2012. The MPPMCL has been vested with several of functions and powers

that were earlier vested with the erstwhile M.P. State Electricity Board.

9. GoMP has entrusted the MPPMCL with the responsibility inter alia of representing the

Discoms before the Commission with regard to filing the tariff petition and facilitating all

proceedings thereon. The Management and Corporate functions agreement signed by the

MPPMCL with the three Discoms of MP also provide for the same.

10. Hon’ble Commission had notified the Tariff Order for the period FY 2016-17 dated 5th

April 2016 while deciding the joint petition no. 73/2015 filed by East Discom, Central

Discom, West Discom and MPPMCL for the determination of tariff for distribution and

retail supply of electricity to the consumers in respective areas of supply during FY 2016-

17.

11. In the backdrop of the above facts and circumstances, the present petition is being made

by the Petitioners (MPPMCL, East Discom, Central Discom and West Discom) under

Section 61 and Section 62 (1) (d) of the Electricity Act 2003, read with Clause 8.1 to 8.16

of the “The Madhya Pradesh Electricity Regulatory Commission (Terms and Conditions

for Determination of Tariff for Distribution and Retail Supply of Electricity and Methods

and Principles of Fixation of Charges) Regulations, 2015 (RG-35 (II) of 2015)” dated 17th

December 2015” for truing up of the ARR for the Distribution and Retail Supply Business

for the period FY 2016-17.

12. Based on the information available, the Petitioners has made sincere efforts to comply

with the Regulations of the Hon’ble Commission and discharge its obligations to the best

of its abilities and resources in its command. However, should any further material

information become available during the process of determination, the petitioners may be

permitted to reserve the right to file such additional information and consequently amend/

revise the petition.

13. The Petitioners has estimated a net ARR of Rs. 9,674.27 Cr for East Discom, Rs. 10,148.93

Cr for Central Discom, Rs. 11,298.43 Cr for West Discom and Rs. 31,121.63 Cr for MP

State respectively. Revenue deficit of Rs. 2,664.07 Cr for East Discom, Rs 2,817.80 Cr



for Central Discom, Rs. 1,765.67 Cr for West Discom and Rs. 7,247.55 Cr for MP State

respectively. The summary of the Petitioner’s Claim is shown below:

Sr. no.

Particulars Discom Approved in Tariff Order

Claimed in True up Petition

Variation

1 Power Purchase Cost Including MPPMCL Cost

EZ 7,136.16 7,872.38 (736.22)

CZ 6,953.47 8,039.55 (1,086.08)

WZ 8,082.78 9,675.18 (1,592.40)

MP State 22,172.41 25,587.10 (3,414.69)

2 Employee Cost (including terminal benefit cash outflow)

EZ 920.58 814.28 106.30

CZ 839.91 906.47 (66.56)

WZ 947.89 761.03 186.86

MP State 2,780.37 2,481.77 298.60

3 A&G Cost

EZ 168.50 212.30 (43.80)

CZ 96.50 98.49 (1.99)

WZ 129.50 143.38 (13.88)

MP State 394.50 454.17 (59.67)

4 R&M Cost

EZ 158.00 174.16 (16.16)

CZ 177.56 130.51 47.05

WZ 122.99 123.48 (0.49)

MP State 458.54 428.15 30.39

5 Depreciation

EZ 134.91 303.80 (168.89)

CZ 161.46 272.54 (111.08)

WZ 106.91 237.30 (130.39)

MP State 403.29 813.63 (410.34)

6 Interest on Project Loans

EZ 225.28 168.96 56.32

CZ 284.20 148.62 135.58

WZ 84.86 75.47 9.39

MP State 594.34 393.05 201.29

7 Interest on Working Capital

EZ 74.92 57.29 17.63

CZ 31.96 121.53 (89.57)

WZ - 25.18 (25.18)

MP State 106.88 204.00 (97.12)

8 Interest on Consumer Security Deposit

EZ 40.32 50.57 (10.25)

CZ 61.87 54.87 7.00

WZ 90.11 62.99 27.12

MP State 192.30 168.43 23.87

9 Return on Equity EZ 255.26 293.25 (37.99)



Sr. no.



Variation

CZ 305.92 311.18 (5.26)

WZ 180.81 168.05 12.76

MP State 741.99 772.48 (30.49)

10 Bad and Doubtful Debts

EZ 2.00 100.89 (98.89)

CZ 2.00 277.46 (275.46)

WZ 2.00 158.51 (156.51)

MP State 6.00 536.86 (530.86)

11 Other Expenses

EZ - - -

CZ - - -

WZ - 0.87 (0.87)

MP State - 0.87 (0.87)

12 Less: Expenses Capitalised

EZ - (103.64) 103.64

CZ - - -

WZ - - -

MP State - (103.64) 103.64

13 Total Expenses

EZ 9,115.91 9,944.23 (828.32)

CZ 8,914.85 10,361.21 (1,446.36)

WZ 9,747.84 11,431.42 (1,683.58)

MP State 27,778.61 31,736.87 (3,958.26)

14 Less: Other Income - Retail & Wheeling

EZ 251.99 269.96 (17.97)

CZ 212.25 212.28 (0.03)

WZ 206.26 133.00 73.26

MP State 670.49 615.24 55.25

15 Less: Savings from Operational efficiency measures

EZ 231.93 - 231.93

CZ 279.83 - 279.83

WZ 88.24 - 88.24

MP State 600.00 - 600.00

16 Net Total Expenses for FY 2016-17

EZ 8,631.99 9,674.27 (1,042.28)

CZ 8,422.77 10,148.93 (1,726.16)

WZ 9,453.35 11,298.43 (1,845.08)

MP State 26,508.11 31,121.63 (4,613.52)

17 Add: Impact of True-Ups

EZ 373.29 408.57 (35.28)

CZ 649.16 680.98 (31.82)

WZ 797.35 835.49 (38.14)

MP State 1,819.80 1,925.04 (105.24)



Sr. no.



Variation

18 Total ARR for FY 2016-17

EZ 9,005.28 10,082.84 (1,077.56)

CZ 9,071.93 10,829.91 (1,757.98)

WZ 10,250.70 12,133.92 (1,883.22)

MP State 28,327.91 33,046.67 (4,718.76)

19 Revenue from sale of Power

EZ 9,005.28 7,418.77 1,586.51

CZ 9,071.93 8,012.11 1,059.82

WZ 10,250.70 10,368.24 (117.54)

MP State 28,327.91 25,799.12 2,528.79

20 Revenue Deficit/Surplus

EZ - 2,664.07 (2,664.07)

CZ - 2,817.80 (2,817.80)

WZ - 1,765.67 (1,765.67)

MP State - 7,247.55 (7,247.55)

14. Shri Firoj Kumar Meshram, Chief General Manager (Revenue Management) of MPPMCL;

Shri Girdhar Wasnik, General Manager (Commercial) of MPPoKVVCL; Gangaram Patele,

General Manager (Regulatory Affairs) of MPMKVVCL and Shri Shailendra Jain, Deputy

Director (Commercial) of MPPaKVVCL have been authorized to execute and file all the

documents on behalf of the respective petitioners in this regard. Accordingly, the current

true up petition filing is signed and verified by, and backed by the affidavit of respective

authorized signatories.



PRAYER

In view of the aforesaid facts and circumstances, the Petitioners request that the Hon'ble

Commission may be pleased to:

a) Take the accompanying True-Up Petition for the period FY 2016-17 of East Discom,

Central Discom and West Discom on record and treat it as complete;

b) Consider and approve True Up amount of Rs. 2,664.07 Crores for East Discom, Rs

2,817.80 Crores for Central Discom and Rs. 1,765.67 Crores for West Discom

aggregating to Rs. 7,247.55 Cr for MP state which shall be incorporated in ARR for

FY 2020-21 or the mechanism for recovery of same, as may be decide by the Hon’ble

Commission.

c) Condone any inadvertent omissions/ errors/ shortcomings and permit the petitioners to

add / change / modify / alter portions of this filing and make further submissions as

may be required at a later stage;

d) Condone the delay in filing of the instant true-up petition.

e) Pass on such an order as the Hon'ble Commission may deem fit and proper in the facts

and circumstances of the case.

Dated: ____ September’2019

For M. P. Power Management Co. Ltd.

Jabalpur

For M. P. Poorv Kshetra Vidyut

Vitaran Co. Ltd, Jabalpur

Shri Firoj Kumar Meshram

CGM (Revenue Management)

Shri Girdhar Wasnik

GM (Commercial)

For M. P. Madhya Kshetra Vidyut

Vitaran Co. Ltd, Bhopal

For M. P. Pashchim Kshetra Vidyut

Vitaran Co. Ltd, Indore

Shri Gangaram Patele

GM (Regulatory Affairs)

Shri Shailendra Jain,

Dy. Director (Commercial)



Table of Contents

T1: COMPARISON OF CLAIMED AND ALLOWED ARR FOR FY2016-17 .......... 10

T2: POWER PURCHASE COST ..................................................................................... 13

T3: ENERGY SALES ........................................................................................................ 33

T4: OPERATION & MAINTENANCE COST ............................................................... 47

T5: INTEREST & FINANCE CHARGES ...................................................................... 49

T6: DEPRECIATION AND RELATED DEBITS .......................................................... 55

T7: BAD AND DOUBTFUL DEBTS ............................................................................... 57

T8: OTHER EXPENSES ................................................................................................... 58

T9: RETURN ON EQUITY .............................................................................................. 59

T10: TAXES ......................................................................................................................... 62

T11: OTHER EXPENSES CAPITALISED ...................................................................... 62

T12: OTHER INCOME ...................................................................................................... 63

T13: INCOME FROM SALE OF POWER ...................................................................... 65

T14: SUMMARY OF TRUE UP ARR FOR FY 2016-17 ................................................. 68



LIST OF TABLES Table 1: Comparison of ARR claimed and Allowed for FY 2016-17 ......................................................... 10

Table 2: Details of True Up allowed ............................................................................................................ 12

Table 3: Details of power purchase quantum and cost – Allowed and As per Audited Accounts ............... 29

Table 4: Number of Consumer for the FY 2016-17 ..................................................................................... 33

Table 5: Connected Load for the FY 2016-17 (kW) .................................................................................... 33

Table 6: Sale for FY 2016-17 (MUs) ........................................................................................................... 34

Table 7: Month & Category wise Sale for FY 2016-17 (MUs) ................................................................... 35

Table 8: Assumptions ................................................................................................................................... 39

Table 9: Calculation of disallowed units as per existing methodology ........................................................ 39

Table 10: Calculation of Energy Balance as per Existing methodology Of MPERC .................................. 40

Table 11: Calculation of Power Purchase Cost as per Existing Methodology of MPERC .......................... 40

Table 12: Calculation of Energy Balance considering UI Sale .................................................................... 41

Table 13: Calculation of disallowed units as per proposed methodology .................................................... 41

Table 14: Calculation of cost of disallowed power purchase units as per proposed methodology .............. 44

Table 15: Details of power purchase cost to be allowed for East Discom FY 2016-17 (Rs Cr) .................. 44

Table 16: Details of power purchase cost to be allowed for Central Discom FY 2016-17 (Rs Cr) ............. 44

Table 17: Details of power purchase cost to be allowed for West Discom FY 2016-17 (Rs Cr) ................. 45

Table 18: Comparison of Costs – Commission’s Methodology Vs Petitioner’s Methodology (Rs Cr.) ..... 46

Table 19: Details of O&M cost claimed towards true up of FY 2016-17 .................................................... 47

Table 20: Details of Finance Charges Claimed by East Discom for True-up FY 2016-17 (Rs Cr) ............ 49

Table 21: Details of Finance Charges Claimed by Central Discom for True-up FY 2016-17 (Rs Cr) ........ 50

Table 22: Details of Finance Charges claimed by West Discom for True-up of FY 2016-17 ..................... 50

Table 23: Details of Interest on Working Capital Claimed by East Discom in True up of FY 2016-17 ..... 51

Table 24: Details of Interest on Working Capital Claimed by West Discom in True up of FY 2016-17 .... 53

Table 25: Details of Interest on Consumer Security Deposit claimed for the year FY 2016-17 .................. 53

Table 26: Summary of Interest and Finance Charges claimed towards True up of FY 2016-17 ................. 54

Table 27: Details of Depreciation Claimed by petitioners for FY 2016-17 ................................................. 55

Table 28: Details of Bad and Doubtful debts Claimed by petitioners for FY 2016-17 ................................ 57

Table 29: Other Expenses Claimed as true up for FY 2016-17 ................................................................... 58

Table 30: ROE Claimed by EZ as true up for FY 2016-17 .......................................................................... 59

Table 31: ROE Claimed by CZ as true up for FY 2016-17.......................................................................... 60

Table 32: ROE Claimed by WZ as true up for FY 2016-17 ........................................................................ 60

Table 33: ROE Claimed by Petitioners for FY 2016-17 .............................................................................. 61

Table 34: Other expenses capitalized claimed by East Discom for FY 2016-17 ......................................... 62

Table 35: Other expenses capitalized claimed by West Discom for FY 2016-17 ........................................ 62

Table 36: Other income claimed by Petitioners for FY 2016-17 ................................................................. 63

Table 37: Revenue from Sales for East Discom FY 2016-17 ...................................................................... 65

Table 38: Revenue from Sales for Central Discom FY 2016-17 ................................................................. 66

Table 39: Revenue from Sales for West Discom FY 2016-17 ..................................................................... 67

Table 40: Summary of True Up Claimed for FY 2016-17 (Rs Cr) .............................................................. 68

..



T1: COMPARISON OF CLAIMED AND ALLOWED ARR FOR FY2016-17

1.1 East Discom, Central Discom and West Discom in its tariff petition no. 73/2015, dated

21st December 2015 had submitted the claim for ARR of Rs. 9713 Cr, Rs. 9835 Cr and

Rs. 10,740 Cr respectively. Hon’ble Commission in its Tariff Order dated 5th April 2016

had allowed the ARR of Rs 9005.25 Cr, Rs. 9071.93 Cr and Rs 10,250.70 Cr for East,

Central and West Discoms respectively. The head-wise comparison is given in

following table:

Table 1: Comparison of ARR claimed and Allowed for FY 2016-17

Sr. no.

Particulars Discom Claimed in ARR Petition

Approved Disallowance

1 Power Purchase Admitted

EZ 6,421.00 6,007.00 414.00

CZ 6,209.00 5,803.83 405.17

WZ 7,144.00 6,632.22 511.78

MP State 19,774.00 18,443.05 1,330.95

2 Inter State transmission Charges

EZ 456.00 456.00 -

CZ 441.00 441.00 -

WZ 580.00 580.00 -

MP State 1,477.00 1,477.00 -

3 Intra State transmission Charges including SLDC

EZ 740.00 673.16 66.84

CZ 779.00 708.64 70.36

WZ 957.00 870.56 86.44

MP State 2,476.00 2,252.36 223.64


EZ 927.00 920.58 6.42

CZ 883.00 839.91 43.09

WZ 950.00 947.89 2.11

MP State 2,760.00 2,708.38 51.62

5 A&G Cost

EZ 173.00 168.50 4.50

CZ 98.00 96.50 1.50

WZ 141.00 129.50 11.50

MP State 412.00 394.50 17.50

6 R&M Cost

EZ 158.00 158.00 -

CZ 178.00 177.56 0.44

WZ 123.00 122.99 0.01

MP State 459.00 458.55 0.45

7 Depreciation

EZ 283.00 134.91 148.09

CZ 378.00 161.46 216.54

WZ 233.54 106.91 126.63

MP State 894.54 403.28 491.26

8 Interest and Finance Charges

EZ 274.00 340.52 (66.52)

CZ 399.00 378.03 20.97

WZ 217.32 174.97 42.35

MP State 890.32 893.52 (3.20)

9 Return on Equity

EZ 312.00 255.26 56.74

CZ 401.00 305.92 95.08

WZ 234.78 180.81 53.97

MP State 947.78 741.99 205.79


EZ 81.00 2.00 79.00

CZ 81.00 2.00 79.00

WZ 91.00 2.00 89.00



Sr. no.

Particulars Discom Claimed in ARR Petition

Approved Disallowance

MP State 253.00 6.00 247.00

11 Other Expenses

EZ 1.00 1.00

CZ -

WZ -

MP State 1.00 - 1.00

12 Less: Expenses Capitalised

EZ -

CZ -

WZ -

MP State - - -

13 Total Expenses

EZ 9,826.00 9,115.91 710.09

CZ 9,847.00 8,914.85 932.15

WZ 10,671.64 9,747.84 923.80

MP State 30,344.64 27,778.60 2,566.04


EZ 275.00 251.99 23.01

CZ 192.00 212.25 (20.25)

WZ 134.00 206.26 (72.26)

MP State 601.00 670.50 (69.50)


EZ 231.93 (231.93)

CZ 279.83 (279.83)

WZ 88.24 (88.24)

MP State - 600.00 (600.00)


EZ 9,551.00 8,631.99 919.01

CZ 9,656.00 8,422.77 1,233.23

WZ 10,537.64 9,453.35 1,084.29

MP State 29,744.64 26,508.11 3,236.53


EZ 161.00 373.29 (212.29)

CZ 180.00 649.16 (469.16)

WZ 203.00 797.35 (594.35)

MP State 544.00 1,819.80 (1,275.80)


EZ 9,713.00 9,005.28 707.72

CZ 9,835.00 9,071.93 763.07

WZ 10,740.64 10,250.70 489.94

MP State 30,288.64 28,327.91 1,960.73


EZ 8,071.00 9,005.28 (934.28)

CZ 8,121.00 9,071.93 (950.93)

WZ 9,114.00 10,250.70 (1,136.70)

MP State 25,306.00 28,327.91 (3,021.91)

20 Revenue Deficiet /Surplus

EZ 1,642.00 - 1,642.00

CZ 1,714.00 - 1,714.00

WZ 1,626.64 - 1,626.64

MP State 4,982.64 - 4,982.64

1.2 Hon’ble Commission has included the impact of various true up/final orders on ARR

for FY 2016-17 as per the following table:



Table 2: Details of True Up allowed

1.3 Out of the total

impact of Rs. 1819.80 Cr for the State as a whole, an impact to the tune of Rs 373.29

Cr, Rs 649.16 Cr and Rs 797.35 Cr has been allowed in the ARR of East Discom,

Central Discom and West Discom respectively for FY 2016-17.

1.4 On finalisation of the Audited Accounts of the petitioners for the period FY 2016-17,

the actual head wise cost has been compared with the allowed costs and details of which

have been provided in the subsequent Chapters.

Sr.no. Particulars Impact (Rs. Cr)

1 Impact of True-Up of Discoms for FY 2005-06 365.83

2 Impact of True-Up of MP Transco for FY 2013-14

281.43

3 Impact of True-Up of MP Genco for FY 2012-13 -103.55

4 Impact of True-Up of MP Genco for FY 2013-14 -283.16

5 Impact of True-Up of Discoms for FY 2012-13 1559.25

Total Power Purchase Cost 1819.80



T2: POWER PURCHASE COST

2.1 The Petitioners purchases power from MPPGCL generating stations, Central generating

stations and other sources such as Captive Power Plants, Bio-mass units, CPPs / IPPs,

Solar and other RE sources and short term sources to meet the energy requirement of

the State.

2.2 The Petitioners would like to submit that, on the basis of normative loss level specified

in the tariff regulations, the Hon’ble Commission in its Tariff Order dated 5th April 2016

had determined the Energy requirement of 20,246 MUs for East Discom, 19,584 MUs

for Central Discom, 22,357 MUs for West Discom aggregating to 62,186 MUs for the

MP State for FY 2016-17 at a cost of Rs. 7,136.16 Cr for the East Discom, Rs. 6,953.47

Cr for the Central Discom and Rs. 8,082.78 Cr for the West Discom thus aggregating

to Rs. 22,172.41 Cr for the MP State for FY 2016-17 respectively.

2.3 The Petitioners submits that based on annual audited accounts and actual distribution

losses, power purchase cost (including transmission charges) arrives at Rs. 8,039.97 Cr

for the East Discom, Rs. 8,686.77 Cr for the Central Discom and Rs. 9,752.57 Cr for

the West Discom aggregating to Rs. 26,479.31 Cr for the MP State for FY 2016-17 as

shown in the Table below:



Sr. no

Power Plant (%) Allocation

Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)

ED, Cess, Heavy Water

Charge, Water

Charges (Rs Cr)

MOPA, Insurance Charges (Rs Cr)

Other Charges (Rs Cr)

Total Cost (Rs Cr)

I Power Purchase from Central Generating Stations

1 KSTPS 3,487.30 217.20 476.67 - - 21.44 - 16.00 731.31

EZ 39.00% 1,360.05 84.71 185.90 - - 8.36 - 6.24 285.21

CZ 28.00% 976.44 60.81 133.47 - - 6.00 - 4.48 204.77

WZ 33.00% 1,150.81 71.67 157.30 - - 7.07 - 5.28 241.33

2 KSTPS III 619.96 82.13 84.07 - - 3.40 - (2.26) 167.34

EZ 32.00% 198.41 26.48 27.24 - - 1.09 - (0.68) 54.13

CZ 34.84% 216.00 28.75 29.46 - - 1.21 - (0.75) 58.68

WZ 33.15% 205.55 26.90 27.37 - - 1.10 - (0.83) 54.53

3 VSTPS - I 1,932.39 230.08 336.40 - - 36.00 - 10.60 613.09

EZ 36.00% 695.66 82.83 121.11 - - 12.96 - 3.82 220.71

CZ 34.00% 657.01 78.23 114.38 - - 12.24 - 3.60 208.45

WZ 30.00% 579.72 69.02 100.92 - - 10.80 - 3.18 183.93

4 VSTPS-II 1,865.69 148.16 310.76 - - 35.11 - 3.83 497.85

EZ 36.00% 671.65 53.34 111.87 - - 12.64 - 1.38 179.23

CZ 32.00% 597.02 47.41 99.44 - - 11.23 - 1.23 159.31

WZ 32.00% 597.02 47.41 99.44 - - 11.23 - 1.23 159.31

5 VSTPS-III 1,622.42 182.11 268.34 - - 31.14 - (0.14) 481.45

EZ 33.00% 535.40 60.10 88.55 - - 10.28 - (0.05) 158.88

CZ 31.00% 502.95 56.45 83.19 - - 9.65 - (0.04) 149.25

WZ 36.00% 584.07 65.56 96.60 - - 11.21 - (0.05) 173.32

6 VSTPS-IV 1,717.36 311.93 283.48 - - 32.85 - 2.17 630.44

EZ 30.85% 529.86 97.74 87.66 - - 10.20 - 0.65 196.25

CZ 33.78% 580.16 106.82 96.25 - - 11.14 - 0.72 214.94



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

WZ 35.36% 607.34 107.37 99.57 - - 11.51 - 0.80 219.25

7 VSTPS-V 887.22 142.80 147.13 - - 17.17 - 0.37 307.48

EZ 31.53% 279.71 44.97 46.53 - - 5.45 - 0.13 97.08

CZ 34.05% 302.14 49.58 50.36 - - 5.88 - 0.15 105.97

WZ 34.42% 305.36 48.26 50.25 - - 5.83 - 0.09 104.43

8 Kawas 215.66 80.59 42.96 - - - 0.03 4.33 127.92

EZ 35.00% 75.48 28.21 15.04 - - - 0.01 1.51 44.77

CZ 25.00% 53.91 20.15 10.74 - - - 0.01 1.08 31.98

WZ 40.00% 86.26 32.24 17.19 - - - 0.01 1.73 51.17

9 Gandhar 242.95 77.11 47.35 - - - 0.02 15.37 139.85

EZ 32.00% 77.74 24.67 15.15 - - - 0.01 4.92 44.75

CZ 30.00% 72.89 23.13 14.20 - - - - 4.61 41.95

WZ 38.00% 92.32 29.30 17.99 - - - 0.01 5.84 53.14

10 SIPAT I 2,628.98 331.94 346.41 - - 13.18 - 3.52 695.06

EZ 32.41% 852.00 107.77 112.42 - - 4.32 - 1.03 225.54

CZ 35.03% 920.91 116.48 121.83 - - 4.65 - 1.17 244.13

WZ 32.56% 856.07 107.69 112.16 - - 4.22 - 1.32 225.39

11 SIPAT II 1,507.56 176.31 204.42 - - 7.93 - 2.44 391.10

EZ 39.00% 587.95 68.76 79.72 - - 3.09 - 0.95 152.53

CZ 26.00% 391.97 45.84 53.15 - - 2.06 - 0.64 101.68

WZ 35.00% 527.65 61.71 71.55 - - 2.77 - 0.86 136.88

12 TARAPUR 1,686.81 - 494.07 - - 0.42 - 0.09 494.58

EZ 34.00% 573.52 - 167.98 - - 0.14 - 0.03 168.16

CZ 31.00% 522.91 - 153.16 - - 0.13 - 0.03 153.32

WZ 35.00% 590.38 - 172.92 - - 0.15 - 0.03 173.10



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

13 Kahalgaon II 237.59 56.97 52.44 - - 0.02 - (0.38) 109.05

EZ 27.00% 64.15 15.38 14.16 - - - - (0.10) 29.44

CZ 20.00% 47.52 11.39 10.49 - - - - (0.08) 21.81

WZ 53.00% 125.92 30.20 27.79 - - 0.01 - (0.20) 57.80

14 Mauda-I 135.79 223.44 33.46 - - - - (0.72) 256.17

EZ 26.87% 36.48 66.81 9.06 - - - - (0.18) 75.70

CZ 33.17% 45.05 77.08 11.10 - - - - (0.22) 87.95

WZ 39.96% 54.26 79.54 13.30 - - - - (0.32) 92.52

15 Mauda-II 26.67 17.92 6.48 - - - - - 24.40

EZ 25.05% 6.68 4.40 1.62 - - - - - 6.02

CZ 32.69% 8.72 5.82 2.12 - - - - - 7.94

WZ 42.25% 11.27 7.70 2.74 - - - - - 10.44

Total (I) 18,814.37 2,278.68 3,134.46 - - 198.65 0.05 55.23 5,667.07

EZ 6,544.75 766.16 1,084.03 - - 68.53 0.02 19.66 1,938.39

CZ 5,895.61 727.95 983.34 - - 64.21 0.01 16.63 1,792.14

WZ 6,374.01 784.57 1,067.09 - - 65.91 0.02 18.95 1,936.54

II Purchase from Other Sources

1 NHDC-Indira Sagar 3,253.33 624.31 152.98 - - 50.23 - 4.46 831.97

EZ 22.00% 715.73 137.35 33.66 - - 11.05 - 0.98 183.03

CZ 25.00% 813.33 156.08 38.24 - - 12.56 - 1.11 207.99

WZ 53.00% 1,724.26 330.88 81.08 - - 26.62 - 2.36 440.94

2 SSP 1,785.10 177.86 146.38 - - - - - 324.24

EZ 32.00% 571.23 56.91 46.84 - - - - - 103.76



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

CZ 25.00% 446.27 44.46 36.59 - - - - - 81.06

WZ 43.00% 767.59 76.48 62.94 - - - - - 139.42

3 OMKARESHWAR 1,416.63 422.93 60.34 - - 21.54 - (0.78) 504.03

EZ 30.00% 424.99 126.88 18.10 - - 6.46 - (0.23) 151.21

CZ 25.00% 354.16 105.73 15.09 - - 5.38 - (0.19) 126.01

WZ 45.00% 637.48 190.32 27.15 - - 9.69 - (0.35) 226.81

4 ISP NVDA 9.28 - 4.11 - - - - - 4.11

EZ 22.00% 2.04 - 0.90 - - - - - 0.90

CZ 25.00% 2.32 - 1.03 - - - - - 1.03

WZ 53.00% 4.92 - 2.18 - - - - - 2.18

5 Wind Energy 3,077.33 - 1,733.72 - - - - - 1,733.72

EZ 30.04% 924.43 - 520.81 - - - - - 520.81

CZ 32.86% 1,011.21 - 569.70 - - - - - 569.70

WZ 37.10% 1,141.69 - 643.21 - - - - - 643.21

6 DVC (Mejia) 627.95 185.47 141.90 - - - - 1.18 328.55

EZ 33.00% 207.22 61.21 46.83 - - - - 0.39 108.42

CZ 14.00% 87.91 25.97 19.87 - - - - 0.16 46.00

WZ 53.00% 332.81 98.30 75.21 - - - - 0.62 174.13

7 DVC (Chandrpur) 1,033.68 217.87 202.15 - - - - 2.53 422.55

EZ 33.00% 341.11 71.90 66.71 - - - - 0.83 139.44

CZ 14.00% 144.72 30.50 28.30 - - - - 0.35 59.16

WZ 53.00% 547.85 115.47 107.14 - - - - 1.34 223.95

8 DVC (Durgapur) 195.40 116.10 43.61 - - - - - 159.71

EZ 29.01% 56.69 36.76 12.72 - - - - - 49.48

CZ 32.54% 63.58 40.41 14.19 - - - - - 54.61



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

WZ 38.45% 75.13 38.93 16.70 - - - - - 55.63

9 Torrent 0.08 67.56 0.03 - - - - 0.04 67.63

EZ 26.90% 0.02 20.95 0.01 - - - - 0.01 20.97

CZ 34.40% 0.03 22.11 0.01 - - - - 0.01 22.14

WZ 38.70% 0.03 24.49 0.01 - - - - 0.01 24.52

10 Sasan 10,425.05 171.69 1,198.40 - - 503.07 - 37.81 1,910.96

EZ 31.69% 3,303.75 55.63 379.78 - - 160.02 - 10.87 606.29

CZ 34.28% 3,574.11 59.56 410.86 - - 173.17 - 12.90 656.49

WZ 34.03% 3,547.19 56.50 407.76 - - 169.88 - 14.04 648.18

11 RDM Care 1.82 - 0.61 - - - - - 0.61

EZ 29.99% 0.55 - 0.18 - - - - - 0.18

CZ 32.85% 0.60 - 0.20 - - - - - 0.20

WZ 37.16% 0.68 - 0.23 - - - - - 0.23

12 JP Bina 162.33 484.51 38.57 - - 3.31 - 0.46 526.85

EZ 24.53% 39.82 137.64 9.47 - - 0.88 - 0.13 148.12

CZ 33.43% 54.26 160.86 12.90 - - 1.10 - 0.16 175.02

WZ 42.04% 68.25 186.01 16.21 - - 1.32 - 0.18 203.71

13 BLA 15.48 18.98 3.37 - - 0.54 - - 22.89

EZ 36.04% 5.58 6.09 1.22 - - 0.19 - - 7.50

CZ 30.32% 4.69 6.37 1.02 - - 0.18 - - 7.57

WZ 33.64% 5.21 6.53 1.13 - - 0.17 - - 7.83

14 MB Power Unit - I 824.86 238.61 160.33 - - - - - 398.94

EZ 29.13% 240.27 73.34 46.73 - - - - - 120.07

CZ 33.24% 274.16 81.60 53.28 - - - - - 134.88

WZ 37.63% 310.42 83.67 60.32 - - - - - 144.00



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

15 MB Power Unit - II 44.25 12.99 8.83 - - - - - 21.83

EZ 34.12% 15.10 4.47 3.01 - - - - - 7.48

CZ 30.23% 13.38 3.89 2.67 - - - - - 6.56

WZ 35.66% 15.78 4.63 3.15 - - - - - 7.78

16 Hindalco 0.04 - 0.01 - - - - - 0.01

EZ 29.89% 0.01 - - - - - - - -

CZ 31.84% 0.01 - - - - - - - -

WZ 38.27% 0.01 - - - - - - - -

17 Lanco Amarkantak 1,903.88 282.55 288.82 - - 2.32 - 9.63 583.32

EZ 31.42% 598.27 90.50 90.88 - - 0.75 - 3.03 185.16

CZ 34.22% 651.55 99.72 98.67 - - 0.82 - 3.30 202.50

WZ 34.35% 654.07 92.33 99.27 - - 0.75 - 3.31 195.65

18 Arya 60.46 - 33.52 - - - - - 33.52

EZ 29.88% 18.06 - 10.02 - - - - - 10.02

CZ 32.83% 19.85 - 11.01 - - - - - 11.01

WZ 37.29% 22.55 - 12.50 - - - - - 12.50

19 M/s Orient Green 9.66 - 4.27 - - - - - 4.27

EZ 29.64% 2.86 - 1.27 - - - - - 1.27

CZ 32.79% 3.17 - 1.40 - - - - - 1.40

WZ 37.57% 3.63 - 1.60 - - - - - 1.60

20 JP Nigrie 3,302.06 568.66 234.44 - - 51.29 - - 854.40

EZ 32.76% 1,081.60 184.15 77.43 - - 16.84 - - 278.42

CZ 35.36% 1,167.67 201.02 82.40 - - 18.14 - - 301.57

WZ 31.88% 1,052.80 183.49 74.61 - - 16.32 - - 274.42

21 Jhabua Power 23.91 125.67 5.52 - - 0.36 - 0.18 131.73



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

EZ 32.84% 7.85 42.62 1.81 - - 0.12 - 0.06 44.60

CZ 31.12% 7.44 42.27 1.72 - - 0.11 - 0.06 44.16

WZ 36.04% 8.62 40.78 1.99 - - 0.13 - 0.07 42.97

22 Jabalpur MSW 26.52 - 16.84 - - - - - 16.84

EZ 29.90% 7.93 - 5.04 - - - - - 5.04

CZ 32.84% 8.71 - 5.53 - - - - - 5.53

WZ 37.26% 9.88 - 6.28 - - - - - 6.28

23 Solar Energy 872.05 - 627.38 - - - - - 627.38

EZ 30.04% 261.96 - 188.47 - - - - - 188.47

CZ 32.86% 286.56 - 206.16 - - - - - 206.16

WZ 37.10% 323.53 - 232.76 - - - - - 232.76

24 Rihand 75.50 - 2.49 - - - - - 2.49

EZ 29.00% 21.90 - 0.72 - - - - - 0.72

CZ 33.00% 24.92 - 0.82 - - - - - 0.82

WZ 38.00% 28.69 - 0.95 - - - - - 0.95

25 Matatila 36.78 - 1.16 - - - - - 1.16

EZ 29.00% 10.66 - 0.34 - - - - - 0.34

CZ 33.00% 12.14 - 0.38 - - - - - 0.38

WZ 38.00% 13.97 - 0.44 - - - - - 0.44

Others-Total (II) 29,183.42 3,715.77 5,109.81 - - 632.66 - 55.50 9,513.74

EZ 8,859.64 1,106.40 1,562.93 - - 196.31 - 16.06 2,881.70

CZ 9,026.74 1,080.55 1,612.05 - - 211.47 - 17.86 2,921.93

WZ 11,297.04 1,528.81 1,934.83 - - 224.88 - 21.58 3,710.10



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

A Grand Total other than Genco (I+II) 47,997.80 5,994.45 8,244.26 - - 831.31 0.05 110.74 15,180.81

EZ 15,404.39 1,872.56 2,646.96 - - 264.84 0.02 35.72 4,820.10

CZ 14,922.35 1,808.50 2,595.39 - - 275.68 0.01 34.48 4,714.07

WZ 17,671.06 2,313.38 3,001.92 - - 290.79 0.02 40.53 5,646.64

I MP Genco - Thermal

1 ATPS-Chachai (210MW) 1,343.64 217.32 255.40 - - 3.11 - 1.13 476.96

EZ 27.00% 362.78 58.68 68.96 - - 0.84 - 0.30 128.78

CZ 40.00% 537.45 86.93 102.16 - - 1.25 - 0.45 190.79

WZ 33.00% 443.40 71.72 84.28 - - 1.03 - 0.37 157.40

2 STPS Sarni 1,115.83 370.02 306.14 - - 3.64 - 1.84 681.64

EZ 29.00% 323.59 107.31 88.78 - - 1.05 - 0.53 197.67

CZ 39.00% 435.17 144.31 119.39 - - 1.42 - 0.72 265.84

WZ 32.00% 357.06 118.41 97.96 - - 1.16 - 0.59 218.12

3 SGTPS Birsingpur 2,837.99 397.64 684.01 - - 7.08 - 1.14 1,089.86

EZ 28.00% 794.64 111.34 191.52 - - 1.98 - 0.32 305.16

CZ 40.00% 1,135.20 159.05 273.60 - - 2.83 - 0.45 435.94

WZ 32.00% 908.16 127.24 218.88 - - 2.26 - 0.36 348.76

4 SGTPS Birsingpur (500MW) 3,446.09 417.30 752.72 - - 4.21 - 0.68 1,174.91

EZ 28.00% 964.91 116.84 210.76 - - 1.18 - 0.19 328.97

CZ 40.00% 1,378.44 166.92 301.09 - - 1.68 - 0.27 469.96

WZ 32.00% 1,102.75 133.54 240.87 - - 1.35 - 0.22 375.97

5 STPS Sarni # 10 & 11 2,118.00 716.26 459.30 - - 2.19 - 1.11 1,178.85

EZ 29.86% 632.38 222.67 136.91 - - 0.68 - 0.34 360.61

CZ 33.44% 708.16 240.63 153.71 - - 0.74 - 0.37 395.44



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

WZ 36.71% 777.46 252.96 168.68 - - 0.77 - 0.39 422.80

6 SSTPS Singaji Khandwa 1 & 2 2,331.18 1,356.75 590.29 - - 17.82 - 0.61 1,965.48

EZ 27.24% 635.12 416.98 160.60 - - 5.48 - 0.19 583.25

CZ 33.53% 781.70 449.89 198.04 - - 5.91 - 0.20 654.04

WZ 39.22% 914.37 489.89 231.65 - - 6.43 - 0.22 728.19

M.P. Genco Thermal-Total (I) 13,192.72 3,475.28 3,047.86 - - 38.05 - 6.50 6,567.70

EZ 3,713.41 1,033.81 857.53 - - 11.22 - 1.88 1,904.44

CZ 4,976.12 1,247.72 1,148.00 - - 13.82 - 2.47 2,412.01

WZ 4,503.19 1,193.75 1,042.33 - - 13.01 - 2.15 2,251.25

II MP Genco - Hydel

1 Gandhi Sagar 173.12 2.10 4.31 - - 6.82 - 0.03 13.27

EZ 23.00% 39.82 0.48 0.99 - - 1.57 - 0.01 3.05

CZ 50.00% 86.56 1.05 2.16 - - 3.41 - 0.02 6.63

WZ 27.00% 46.74 0.57 1.16 - - 1.84 - 0.01 3.58

2 R P Sagar 220.46 - 33.29 - - - - - 33.29

EZ 20.00% 44.09 - 6.66 - - - - - 6.66

CZ 50.00% 110.23 - 16.64 - - - - - 16.64

WZ 30.00% 66.14 - 9.99 - - - - - 9.99

3 Jawahar Sagar 152.20 - 22.98 - - - - - 22.98

EZ 20.00% 30.44 - 4.60 - - - - - 4.60

CZ 50.00% 76.10 - 11.49 - - - - - 11.49

WZ 30.00% 45.66 - 6.89 - - - - - 6.89

4 Pench 264.40 9.12 11.34 - - - - 0.05 20.51



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

EZ 20.00% 52.88 1.82 2.27 - - - - 0.01 4.10

CZ 40.00% 105.76 3.65 4.54 - - - - 0.02 8.20

WZ 40.00% 105.76 3.65 4.54 - - - - 0.02 8.20

5 Ban Sagar (I+II+III) 1,390.48 69.47 92.22 - - 12.82 - 0.12 174.63

EZ 30.00% 417.14 20.84 27.67 - - 3.85 - 0.04 52.39

CZ 30.00% 417.14 20.84 27.67 - - 3.85 - 0.04 52.39

WZ 40.00% 556.19 27.79 36.89 - - 5.13 - 0.05 69.85

6 Jhinna HPS 87.21 6.65 9.59 - - 0.90 - 0.01 17.14

EZ 30.00% 26.16 2.00 2.88 - - 0.27 - - 5.14

CZ 30.00% 26.16 2.00 2.88 - - 0.27 - - 5.14

WZ 40.00% 34.88 2.66 3.83 - - 0.36 - - 6.86

7 Brinsingpur Hydro 40.62 2.49 3.68 - - 0.58 - 0.01 6.76

EZ 30.00% 12.19 0.75 1.10 - - 0.17 - - 2.03

CZ 20.00% 8.12 0.50 0.74 - - 0.12 - - 1.35

WZ 50.00% 20.31 1.25 1.84 - - 0.29 - - 3.38

8 Bargi 443.14 7.51 6.96 - - 12.34 - 0.03 26.83

EZ 25.00% 110.78 1.88 1.74 - - 3.08 - 0.01 6.71

CZ 25.00% 110.78 1.88 1.74 - - 3.08 - 0.01 6.71

WZ 50.00% 221.57 3.75 3.48 - - 6.17 - 0.01 13.42

9 Rajghat 30.03 1.15 3.81 - - - - 0.01 4.98

EZ 20.00% 6.01 0.23 0.76 - - - - - 1.00

CZ 40.00% 12.01 0.46 1.52 - - - - 0.01 1.99

WZ 40.00% 12.01 0.46 1.52 - - - - 0.01 1.99

10 Madhikheda HPS 145.73 13.40 22.33 - - 2.39 - 0.02 38.14

EZ 30.00% 43.72 4.02 6.70 - - 0.72 - 0.01 11.44



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

CZ 20.00% 29.15 2.68 4.47 - - 0.48 - - 7.63

WZ 50.00% 72.86 6.70 11.17 - - 1.20 - 0.01 19.07

M.P. Genco Hydel Total (II) 2,947.38 111.89 210.51 - - 35.84 - 0.27 358.52

EZ 783.23 32.02 55.36 - - 9.66 - 0.07 97.11

CZ 982.02 33.05 73.83 - - 11.20 - 0.09 118.18

WZ 1,182.13 46.82 81.31 - - 14.98 - 0.11 143.23

B MP Genco TOTAL (I+II) 16,140.10 3,587.17 3,258.37 - - 73.89 - 6.78 6,926.22

EZ 4,496.64 1,065.83 912.89 - - 20.88 - 1.95 2,001.55

CZ 5,958.14 1,280.77 1,221.83 - - 25.03 - 2.56 2,530.19

WZ 5,685.32 1,240.57 1,123.65 - - 27.99 - 2.26 2,394.47

C Total Power Purchased (A+B) 64,137.89 9,581.63 11,502.63 - - 905.21 0.05 117.51 22,107.03

EZ 19,901.03 2,938.39 3,559.85 - - 285.72 0.02 37.67 6,821.65

CZ 20,880.49 3,089.28 3,817.22 - - 300.71 0.01 37.05 7,244.26

WZ 23,356.37 3,553.95 4,125.57 - - 318.78 0.02 42.79 8,041.11

D Total Inter-State transmission charges

1 PGCIL - 1,341.38 - - - - - - 1,341.38

EZ 31.06% - 416.65 - - - - - - 416.65

CZ 32.57% - 436.91 - - - - - - 436.91

WZ 36.37% - 487.82 - - - - - - 487.82

2 POSCO - 6.15 - - - - - - 6.15

EZ 31.53% - 1.94 - - - - - - 1.94

CZ 32.59% - 2.00 - - - - - - 2.00



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

WZ 35.88% - 2.21 - - - - - - 2.21

3 Torrent Transmission - 0.05 - - - - - - 0.05

EZ 33.17% - 0.02 - - - - - - 0.02

CZ 32.37% - 0.01 - - - - - - 0.01

WZ 34.45% - 0.02 - - - - - - 0.02

4 Lanco Amarkantak Transmission - 58.59 - - - - - - 58.59

EZ 31.52% - 18.47 - - - - - - 18.47

CZ 35.30% - 20.68 - - - - - - 20.68

WZ 33.18% - 19.44 - - - - - - 19.44

D Total Transmission charges ( 1 to 4) - 1,406.17 - - - - - - 1,406.17

EZ - 437.08 - - - - - - 437.08

CZ - 459.61 - - - - - - 459.61

WZ - 509.49 - - - - - - 509.49

E TOTAL COST FOR ENERGY PURCHASE (C+D) 64,137.89 10,987.80 11,502.63 - - 905.21 0.05 117.51 23,513.20

EZ 19,901.03 3,375.47 3,559.85 - - 285.72 0.02 37.67 7,258.73

CZ 20,880.49 3,548.89 3,817.22 - - 300.71 0.01 37.05 7,703.87

WZ 23,356.37 4,063.44 4,125.57 - - 318.78 0.02 42.79 8,550.60

F Supplementary Bills - 1,218.36 - - - - - - 1,218.36

EZ 30.24% - 368.40 - - - - - 368.40

CZ 29.39% - 358.09 - - - - - 358.09

WZ 40.37% - 491.87 - - - - - 491.87

G TOTAL COST FOR ENERGY PURCHASE INCLUDING SUPPLEMENTRY BILLS(E+F)

64,137.89 12,206.15 11,502.63 - - 905.21 0.05 117.51 24,731.56

EZ 19,901.03 3,743.87 3,559.85 - - 285.72 0.02 37.67 7,627.13



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

CZ 20,880.49 3,906.98 3,817.22 - - 300.71 0.01 37.05 8,061.96

WZ 23,356.37 4,555.31 4,125.57 - - 318.78 0.02 42.79 9,042.47

H Other costs passed to Discoms - which cannot be apportioned station wise-

- 212.05 - - - - - - 212.05

EZ - 66.03 - - - - - 66.03

CZ - 71.51 - - - - - 71.51

WZ - 74.51 - - - - - 74.51

I TOTAL COST FOR ENERGY PURCHASE (G+H) 64,137.89 12,418.21 11,502.63 - - 905.21 0.05 117.51 24,943.61

EZ 19,901.03 3,809.90 3,559.85 - - 285.72 0.02 37.67 7,693.16

CZ 20,880.49 3,978.48 3,817.22 - - 300.71 0.01 37.05 8,133.47

WZ 23,356.37 4,629.82 4,125.57 - - 318.78 0.02 42.79 9,116.98

J Less: Other Income - - - - - - - 502.22 502.22

EZ - - - - - - - 155.69 155.69

CZ - - - - - - - 165.73 165.73

WZ - - - - - - - 180.80 180.80

K Less: Sale of Power 2,391.36 - - - - - - 750.57 750.57

EZ 29.89% 714.78 - - - - - - 222.40 222.40

CZ 32% 761.17 - - - - - - 246.17 246.17

WZ 38.28% 915.41 - - - - - 282.00 282.00

-

L Net Total Purchase cost(I-J-K) 0.00% 61,746.53 12,418.21 11,502.63 - - 905.21 0.05 (1,135.27) 23,690.82

EZ 31.07% 19,186.26 3,809.90 3,559.85 - - 285.72 0.02 (340.41) 7,315.07



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

CZ 32.58% 20,119.32 3,978.48 3,817.22 - - 300.71 0.01 (374.86) 7,721.57

WZ 36% 22,440.96 4,629.82 4,125.57 - - 318.78 0.02 (420.00) 8,654.18

Other Adjustments based on reconciliation - - - - - - (29.94) (29.94)

EZ - - - - 48.23 48.23

CZ - - - - 13.38 13.38

WZ - - - - (91.55) (91.55)

Intra state Transmission Charges 2,878.02 - - - - - - 2,878.02

EZ 786.68 - - - - 786.68

CZ - 941.75 - - - - - 941.75

WZ - 1,149.59 - - - - - 1,149.59

SLDC Charges - 5.08 - - - - - - 5.08

EZ - 2.46 - - - - 2.46

CZ - 2.62 - - - - - 2.62

WZ - - - - - - - -

DSM Charges (520.73) - (30.02) - - - - - (30.02)

EZ (827.53) - (109.57) - - - - (109.57)

CZ 250.89 - 79.55 - - - - 79.55

WZ 55.91 - - - - - - -

RE Charges - - 37.10 - - - - - 37.10

EZ - - (6.13) - - - - (6.13)



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

CZ - - 2.89 - - - - 2.89

WZ - - 40.35 - - - - 40.35

RRVPNL (CHAMBAL-SATPURA) - - - - - - - - -

EZ -

CZ -

WZ -

CSPDCL Border Village (East) and Morand MHP (Central)

- - 4.96 - - - - - 4.96

EZ 4.96 4.96

CZ -

WZ -

Bhimgar (East) & Chambal plus Satpura (Central) MHP

- - - - - - - - -

EZ -

CZ -

WZ -

Sup. Bill Due to revision of SEA for the FY-15

EZ (1.73)

CZ (75.94)

WZ

Power Purchase Cost 61,225.81 15,223.63 11,514.68 - - 905.21 0.05 (1,165.21) 26,479.31



Sr. no


Ratio

Energy Dispatched

MoD Ex-Bus

Fixed Cost (Rs Cr)

Variable Cost

(Rs Cr)

FPA Charges (Rs Cr)

Income Tax (Rs

Cr)


Charge, Water

Charges (Rs Cr)



Total Cost (Rs Cr)

EZ 18,358.73 4,597.31 3,449.11 - - 285.72 0.02 (292.19) 8,039.97

CZ 20,370.21 4,846.91 3,899.66 - - 300.71 0.01 (361.47) 8,686.77

WZ 22,496.87 5,779.41 4,165.91 - - 318.78 0.02 (511.55) 9,752.57

2.4 As per the power purchase statement of MPPMCL, the quantum of the actual ex-bus power purchased by East, Central and West Discoms

for FY 2016-17 was 19,186.26 MUs, 20,119.32 MUs and 22,440.96 MUs respectively which aggregate to 61,746.53 MUs for MP State.

This quantum does not include the quantum of UI and Inter-Discom Sale / Purchase at Discom periphery. The comparison of Power

Purchase as per audited accounts and that allowed in the tariff order is given in the table below:

Table 3: Details of power purchase quantum and cost – Allowed and As per Audited Accounts

Sr. no.

Particulars

Quantum (MUs) Amount (Rs. Cr)

Approved Actual Deviation Approved Actual Deviation

A Power Purchase Cost

1 MP State 64,137.89 64,137.89 18,843.05 22,107.03 3,663.98

i East Discom 19,901.03 19,901.03 6,007.00 6,821.65 814.65

ii Central Discom 20,880.49 20,880.49 5,803.83 7,244.26 1,440.43

iii West Discom 23,356.37 23,356.37 6,632.22 8,041.11 1,408.89

B Inter State Transmission Charges

1 MP State 1,477.00 1,406.17 (70.83)

i East Discom 456.00 437.08 (18.92)

ii Central Discom 441.00 459.61 18.61

iii West Discom 580.00 509.49 (70.51)

C Intra State Transmission Charges including SLDC



Sr. no.

Particulars



1 MP State 2,252.36 2,883.10 630.90

i East Discom 673.00 789.14 116.14


iii West Discom 870.56 1,149.59 279.03

D Supplementary Bill Charges

1 MP State 1,218.36 1,218.36

i East Discom 368.40 368.40

ii Central Discom 358.09 358.09

iii West Discom 491.87 491.87

E Costs which cannot be apportioned station wise to be passed on to DISCOM's- MPPMCL Cost

1 MP State 212.05 212.05




F Other Charges- UI/DSM and RE Charges

1 MP State (520.73) (520.73) (65.62) (65.62)

i East Discom (827.53) (827.53) (112.47) (112.47)

ii Central Discom 250.89 250.89 6.50 6.50

iii West Discom 55.91 55.91 40.35 40.35

G Less: Other Income

1 MP State 502.22 502.22




H Less: Sale of Surplus Power



Sr. no.

Particulars



1 MP State 2,391.36 750.57 750.57

i East Discom 714.78 222.40 222.40


iii West Discom 915.41 282.00 282.00

I Other Adjustment Based on Reconciliation

1 MP State (29.94) (29.94)



iii West Discom (91.55) (91.55)

J Net Power Purchase Cost

1 MP State 61,225.81 61,225.81 22,172.41 26,478.36 4,305.95

i East Discom 18,358.73 18,358.73 7,136.16 8,039.97 903.81

ii Central Discom 20,370.21 20,370.21 6,953.47 8,685.82 1,732.35

iii West Discom 22,496.87 22,496.87 8,082.78 9,752.57 1,669.79



2.5 Variance from approved cost in Tariff Order:

2.5.1 Power purchase Cost as per accounts for East Discom: For power procured during

FY 2016-17, the power purchase cost incurred by the Discom (as per audited accounts)

inclusive of power purchase cost, inter-transmission cost, RE Charges, UI Charges and

PMCL cost was Rs. 8,039.97 Cr. which is higher by Rs. 903.81 Cr. than the cost

approved in the Tariff Order FY 2016-17.

2.5.2 Power purchase Cost as per accounts for Central Discom: For power procured

during FY 2016-17, the power purchase cost incurred by the Discom (as per audited

accounts) inclusive of power purchase cost, inter-transmission cost, RE Charges, UI

Charges and PMCL cost was Rs. 8,686.77 Cr. which is higher by Rs. 1733.30 Cr. than

the cost approved in the Tariff Order FY 2016-17.

2.5.3 Power purchase Cost as per accounts for West Discom: For power procured during

FY 2016-17, the power purchase cost incurred by the Discom (as per audited accounts)

inclusive of power purchase cost, inter-transmission cost, RE Charges, UI Charges and

PMCL cost was Rs. 9,752.57 Cr. which is higher by Rs. 1,669.79 Cr. than the cost

approved in the Tariff Order FY 2016-17.


MPPMCL / MPPoKVVCL/MPMKVVCL/MPPaKVVCL P a g e | 33

T3: ENERGY SALES

3.1 Number of Consumers, Connected Load and Energy Sales within the State

3.1.1 The Discoms served nearly 1,29,25,849 number of consumers at LT level and has around

6,611 number of consumers connected at HT level during FY 2016-17. The Petitioners

aims at managing the energy procurement and sales in the most efficient manner so that

conflicting objectives of availability and cost are balanced to the benefit of consumers.

The Commission in its Tariff Order for FY 2016-17 dated 5th April 2016 has approved

the sales as projected by the Petitioners. The Petitioners has also shown the actual

numbers of consumers and connected load as reported during the FY 2016-17.

3.1.2 The actual Number of Consumer as per prevailing tariff categories viz.-a-viz. as

approved is shown in table below:

Table 4: Number of Consumer for the FY 2016-17

Sr. No Category Approved Actual Deviation

A LT

NO

T A

VA

ILA

BLE

IN T

AR

IFF

OR

DER

N

OT

AP

PLI

CA

BLE

1 MP State 12,925,849

i East Discom 4,858,525

ii Central Discom 3,314,643

iii West Discom 4,752,681

B HT

1 MP State 6,611

i East Discom 1,403

ii Central Discom 2,107

iii West Discom 3,101

C Total

1 MP State 12,932,460




3.1.3 The actual connected load as per prevailing tariff categories viz.-a-viz. as approved is

shown in table below:

Table 5: Connected Load for the FY 2016-17 (kW)


A LT

NO

T A

VA

ILA

BLE

IN T

AR

IFF

OR

DER

N

OT

AP

PLI

CA

BLE

1 MP State 19,838,305




B HT

1 MP State 2,694,767

i East Discom 846,742

ii Central Discom 807,884





C Total

1 MP State 22,533,072




3.1.4 The Petitioners in their ARR Tariff Petition for FY 2016-17 had projected the sales of

15,730 MUs, 15,029 MUs and 17,793 MUs for East DISCOM, Central DISCOM and

West DISCOM respectively for 2016-17 and the same was approved by the Hon’ble

Commission with certain changes in sales mix for LT and HT consumers. The projection

of sales was also estimated and provided in Form No. R1 (i) of its ARR Petition FY 2016-

17. These sales were estimated on the basis of actual sales up to FY 2014-15 which were

available at that time and also considering the increase in average supply hours. On

availability of actual sales for FY 2016-17, it is observed that there is difference between

the actual sales and the approved sales for the FY 2016-17.

3.1.5 The actual sales as per prevailing tariff categories viz.-a-viz. as approved is shown in

table below:

Table 6: Sale for FY 2016-17 (MUs)


A LT

1 MP State 35,451.00 33,365.87 (2,085.13)

i East Discom 10,993.00 10,463.19 (529.81)

ii Central Discom 10,623.00 9,257.95 (1,365.05)

iii West Discom 13,835.00 13,644.73 (190.27)

B HT

1 MP State 13,101.00 9,917.92 (3,183.08)

i East Discom 4,736.00 2,946.28 (1,789.72)


iii West Discom 3,959.00 3,920.44 (38.56)

C Total

1 MP State 48,552.00 43,283.78 (5,268.22)

i East Discom 15,730.00 13,409.47 (2,320.53)


iii West Discom 17,793.00 17,565.17 (227.83)

3.2 The Hon’ble Commission in its Tariff Regulations, 2015 had defined Sales as

uncontrollable in nature which is beyond the control of the Petitioners. The month &

category wise sale as recorded is provided shown in the Table below:



Table 7: Month & Category wise Sale for FY 2016-17 (MUs)

Sr. no Particulars Month and Category Wise Sales (MUs)

A Month Wise Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Mar-17 Total

I MP State Total 3,064.24 3,156.35 3,240.28 3,074.45 2,922.91 2,976.98 3,944.81 3,951.25 3,993.04 4,336.40 4,229.84 4,392.66 43,283.78

1 East 936.59 956.33 974.75 901.81 876.85 891.14 1,158.30 1,129.74 1,183.93 1,486.45 1,405.98 1,507.04 13,409.47

2 Central 886.88 934.21 984.71 929.57 882.12 890.10 1,132.78 1,113.78 1,109.52 1,136.53 1,136.41 1,172.53 12,309.14

3 West 1,240.77 1,265.81 1,280.83 1,243.06 1,163.95 1,195.74 1,653.73 1,707.72 1,699.60 1,713.42 1,687.45 1,713.09 17,565.17

B Category Wise

Low Voltage High Voltage Total

Domestic Non-Domestic

PWW & St. Lt.

Indl. Agri. & Allied Serv

Railways Coal Mines

Indl. & Non-Indl

Seasonal Ind.

Irrig.PWW & Ors

BS Start Up & Sync

I MP State Total 10,959.85 2,831.58 1,182.17 1,207.11 17,184.59 - 490.97 8,139.79 20.44 789.18 467.21 10.33 43,283.78

1 East 3,766.11 1,043.15 423.52 392.55 4,837.29 - 460.02 2,098.88 7.41 99.61 280.20 0.16 13,409.47

2 Central 3,503.39 825.78 325.89 252.88 4,350.02 - 30.95 2,666.91 1.65 190.83 150.68 10.17 12,309.14

3 West 3,690.36 962.66 432.76 561.67 7,997.28 - - 3,374.00 11.37 498.73 36.34 - 17,565.17

3.3 The Petitioners hereby request the Hon’ble Commission to approve sales as i.e. 13,409.47 MUs for the East Discom, 12,309.14 MUs for

the Central Discom and 17,565.17 MUs for the West Discom and 43,283.78 MUs for the MP State for FY 2016-17 which is about 5,268.22

MUs lower than that approved in the Tariff Order dated 5th April 2016 for the MP State, 2,320.53 MUs for the East Discom, 2,719.86

MUs for the Central Discom and 227.83 MUs for the West Discom respectively.



3.4 Method of determination of Power Purchase Cost

3.5 Owing to any variation in the actual loss level, the expenses towards power purchase is

proposed to be shared equally between the distribution licensee and the consumer, as

the excessive loss which is a composite of technical & commercial components is not

only due to the licensee’s efficiency, in fact an active role of consumers is also required

for reduction in the commercial component of the loss.

3.5.1 The method of calculation of power purchase cost for excessive loss over and above

the normative loss is proposed to be as below:

3.5.2 The quantum of power purchase and the costs to be allowed or disallowed should be

based on actual quantum of power purchase which is a real authentic and verifiable item

and not a derivative or notional item. The quantum of sale comprises of both Metered

sales and Un-metered sales. The un-metered sales consist of sale to agricultural pumps

& BPL Domestic consumer and such quantum is an estimate only. Therefore, there is

an overlapping between un-metered sale and losses and it is always difficult to

determine correctly the percentage of un-metered sale and percentage of losses. Thus,

the sales & losses to a certain extent are inter-changeable because of estimation of un-

metered sale. The sales as may not therefore be the correct basis for deciding the rate

of Power Purchase Cost of Discom.

3.5.3 Accordingly, so long as the quantum of actual power purchase is more than the quantum

of power purchase approved, no adjustments in the quantum of power purchase need to

be carried. Without prejudice to the above, even if any adjustment is to be carried out

ignoring the mixing up of un-metered sales and losses, the variation should be solely

derived from actual quantum of power purchase and not from any other derivative

numbers. The vital issues and positions are now considered more elaborately, as below:-

The actual quantum of power purchase is to be adjusted for three elements namely:

Sales

Loss Level allowed;

Loss level not allowed.

3.5.4 In accordance with the above, loss level in excess of normative loss level ought not to

be allowed. This means energy equivalent to excessive loss level should be reduced

from actual power purchase and the balance quantum should be allowed.

(a) If we consider quantum of power purchase derived from the sale allowed (Both are

derivative quantities, however actual power purchase quantum is a real number) by

adopting a reverse calculation, it will give cumulative and double effect. The double

effect is elaborated as below:-



(b) The figure of energy sales – that is metered plus estimated unmetered sales- is in itself,

a derived quantity arising out of estimation of unmetered sales. To make it more

illustrative, we can consider all the quantities involved together in a balance equation,

as follows:

Energy purchased (actual) and served = Losses (estimated) + Energy sales

(estimated)

(c) It is very clear from the above equality, that, the only reasonably fixed and concrete

quantity is the total energy purchased (and served) and the other two quantities

appearing on the R.H.S. are complementary to each other- that is reducing one quantity

results in an equal increase in the other to maintain the balance of the equation. That is,

one of these quantities, if assumed to be known with a certain degree of certainty, can

be used to derive the other. However, this is not the case. Under the present scenario,

precise and independent measurement of both the quantities is not possible. Hence,

either one of them has to be considered as a derived quantity based on the value of the

other, and neither should be used as a reliable decision variable from the point of view

of cost determination. The result of such use can be anomalous and unfair either to the

consumers or the licensee.

(d) In the context of the explanation given above, we can consider the following two

equations to demonstrate the anomaly involved in the methodology for determination

of allowed quantum and hence the cost of power purchase, as follows:

We define,

Allowed sale = Esale

Energy allowed (Normative quantum of energy) = Enorm

Actual Energy purchase = Eact

Normative loss level (in pu) = Lnorm

Actual loss level (in pu) = Lact

It is assumed, that, the actual loss level is known with a reasonable accuracy and the

allowed sale is based on reasonable estimates and parameters of consumption.

From the definitions

Esale = Enorm *(1 - Lnorm), where Lnorm is expressed in per unit ………(1)

Also,

Esale = Eact *(1 - Lact) ………....(2)

Therefore, from (1) and (2)

Eact*(1- Lact) = Enorm* (1- Lnorm)



=>> Enorm = {Eact * (1-Lact)} / {(1-Lnorm)}

=>> Energy disallowed = Eact – Enorm

= Eact- [{Eact * (1-Lact)} / {(1- Lnorm)}]

= Eact*[1-{(1- Lact) / (1-Lnorm)}]

= Eact *[Lact-Lnorm) / (1-Lnorm)]

Finally,

Energy Disallowed = Eact*(Excess losses over normative loss level) / (1- Lnorm)

3.5.5 It is very clear from the above expression, that, working out the normative quantum of

power purchase by applying the normative loss level constraint on the allowed sales,

results in a twofold penalty – one due to the excess of loss level over the prescribed

normative loss level, and another “compounding effect” due to the factor “(1-Lnorm)”,

which is less than 1, in the denominator. The compounding effect is due to the

assumption of limiting the sales and thus assuming equivalent enhancement in losses,

which is actually a complementary quantity derived out of the allowed sales a more or

less assumed quantity (i.e. this becomes a circular feedback or merry-go-round type of

effect). In the final analysis, the allowed sale is not an independent and a precisely

determined quantity and, as such, it should not be used to determine the allowed costs.

3.5.6 In the last expression for disallowed quantum of power purchase, a fair and more even-

handed approach would be to simply disallow the quantum of energy corresponding to

the excess of loss level over the prescribed normative loss level. In algebraic terms,

following the notations indicated earlier, the expression can be written as

Energy Disallowed = Eact *(Excess losses over normative loss level)

= Eact *(Lact–Lnorm),

where loss levels are expressed in per unit values (percentage values/100)

3.6 Hon’ble Tribunal of electricity in Karnataka Power Transmission Corporation Limited

vs Karnataka Electricity Regulatory Commission (Appeal No. 9 of 2008) by Order

dated 9.5.2008 has laid down as under:-

“36. …………….While arriving at the quantum of power purchase to be allowed for

revenue requirement, KERC should first reduce the disallowed T&D losses from the

quantum of power purchase entered in the audited accounts of KPTCL. From the figure

so arrived, the Commission has to reduce the allowed T&D losses which will give the

quantum of power available for sale yielding revenue. Moreover, KERC has to realize

that the audited sale quantum includes metered sale and unmetered sale which also

includes agricultural pumping sets and, therefore, there is an overlapping between the

unmetered sale and loss. In this view of the matter, we are of the opinion that

calculations should be carried out on the basis of the methodology given by KPTCL in

its Memo of Appeal at para ‘W’. We order accordingly.”



3.7 The variation in power purchase in quantum to be considered should begin with and

based on actual quantum of power purchase which is a real item and not a derivative or

notional item. The fallacy in the approach is discussed as under:-

Example:

If Licensee has procured 100 units of electricity, then a sale of 64.5 units would be

registered owing to a normative loss of 34.5%. However the licensee has actually sold

only 60 units, which would mean that the actual loss levels are at 40%, an excess loss

of 5.5% needs to be disallowed.

Table 8: Assumptions

Actual power purchase 100 units

Actual Sales 60 units

Normative loss 34.5%

Actual loss 40% (i.e. [100-60]/100)

Excess loss incurred 5.5% (i.e. 40%-34.5%)

From the aforementioned information, the power purchase and loss levels that need to

be allowed by the Hon’ble Commission can be calculated in two ways. They are:

Existing methodology:

In this methodology, the actual sales are grossed up with the normative losses to

calculate the actual power purchases. The difference between the actual power

purchases and the calculated power purchases will then be disallowed accordingly. The

calculations are shown as under:

Table 9: Calculation of disallowed units as per existing methodology

Estimated power purchase

= Sales / (1-normative loss)

= 60 units / (1-34.5%)

= 91.6 units

Total disallowed units

= Actual power purchase – Estimated power purchase

= 100 units – 91.6 units

= 8.4 units (1)

Using this methodology, total units that are to be disallowed are calculated to be 8.4

units.

3.8 The petitioners are submitting the energy balance and power purchase cost that will be

approved if the existing methodology is adopted by Commission towards the true up

exercise for FY 2016-17.



Table 10: Calculation of Energy Balance as per Existing methodology Of MPERC

A Particulars Index East Central West MP State

1 Actual Sales MUs 13,409.47 12,309.14 17,565.17 43,283.21

2 Normative Loss % 18.00% 19.00% 16.00% 17.49%

3 Input at T&D Periphery (A1/1-A2) MUs 16,352.32 15,196.47 20,910.92 52,459.70

4 MP Transco Loss - Approved % 2.88% 2.88% 2.88% 2.88%

5 Input at G-T Interface (A3/1-A4) MUs 16,837.23 15,647.11 21,531.01 54,015.35

6 Inter- Transmission Losses- Approved MUs 495.00 478.00 546.00 1,519.00

7 Power Purchase Requirement (A5+A6)

MUs 17,332.23 16,125.11 22,077.01 55,534.35

Table 11: Calculation of Power Purchase Cost as per Existing Methodology of MPERC

B Particulars Legend East Central West MP State

1 Total Energy Procured as per Petition MUs 18,358.73 20,370.21 22,496.87 61,225.81

2 Cost of Power Purchase as per Audited Accounts

Rs Cr 8,039.97 8,686.77 9,752.58 26,479.31

3 Supplementary Bills of Previous FYs Rs Cr 368.40 358.09 491.87 1,218.36

4 Net Power Purchase Cost (B2-B3) Rs Cr 7,671.57 8,328.68 9,260.71 25,260.96

5 Fixed Cost for FY 2016-17 Rs Cr 2,938.39 3,089.28 3,553.95 9,581.63

6 Inter Transmission Charges for FY 2016-17 Rs Cr 437.08 459.61 509.49 1,406.17

7 Intra Transmission Charges for FY 2016-17 Rs Cr 789.14 944.37 1,149.60 2,883.11

8 Other Cost of MPPMCL which cannot be apportioned

Rs Cr 66.03 71.51 74.51 212.05

9 Variable Cost for FY-17 (B4-B5-B6-B7-B8) Rs Cr 3,440.93 3,763.92 3,973.16 11,178.00

10 Pooled Variable Rate (B9/B1*1000) Paisa/kWh 187.43 184.78 176.61 182.57

11 Quantum of Power Purchase as per Normative Losses

MUs 17,332.23 16,125.11 22,077.01 55,534.35

12 Variable Cost to be Admitted (B10*B9/1000)

Rs Cr 3,248.53 2,979.53 3,899.01 10,138.91

13 Supplementary Bills of Previous FYs added back

Rs Cr 368.40 358.09 491.87 1,218.36

14 Total Power Purchase Cost to be Admitted (B5+B6+B7+B8+B12+B13)

Rs Cr 7,847.58 7,902.38 9,678.42 25,440.22

3.9 To avoid such circumstance the following methodology is being proposed by the

Petitioners for allowing the power purchase cost on normative basis.

In the above methodology for estimating the power purchase quantum, only the energy

sale to consumer has been considered while the quantum of energy sale to other

Discoms and UI energy at Discom periphery have not been factored. Further, the

Petitioners cannot have any material control on the losses outside their periphery i.e.

M.P. Transco and PGCIL losses as they are external to their periphery and involve

complex interconnected grid. Therefore it will be appropriate to determine average per

unit rate based on the net actual energy input at Discom periphery for sale to retail

consumers only, which is a real and authentic item and may not change even after the

closure of financial year. This would also take into account the sale and purchase of



electricity between the Discom including UI within the State and also banking of power

to other States. It is to be noted that calculation of average per unit rate should not be

based on purchase at ex-bus, which may be revised by way of reconciliation of

regional/State Energy Accounts even after the closure of the financial year for which

true-up has already been carried out.

3.10 Further the petitioners state that the Hon’ble Commission’s methodology for

calculation of energy balance calculation doesn’t account for the UI sales. This results

in erroneous calculation of energy balance and the UI quantum of each Discom is left

unattended. This anomaly may kindly be considered by Hon’ble Commission. The

computation of energy balance considering the UI sales is submitted by petitioners for

Hon’ble Commission’s perusal.

Table 12: Calculation of Energy Balance considering UI Sale

Sr.no. Particulars East Central West MP state

1 Sales 13,409.47 12,309.14 17,565.17 43,283.21

2 Actual Distribution Loss (%) 22.61% 36.15% 17.87% 25.36%

3 Actual Distribution Loss (MU) 3,917.50 6,969.23 3,823.14 14,709.87

4 Input at T-D interface- Actual Drawl as per DSM/UI Sheet

17,358.71 19,447.42 21,745.13 58,551.25

5 Input at T-D interface as per Energy Audit/Approved by the Commission

17,326.40 19,278.37 21,388.31 57,993.08

6 Difference of MUs between Energy Audit and Input at T-D interface including Direct Purchase due to BUS Losses

-32.31 -169.05 -356.82 -558.18

7 Inter State UI at Discom Periphery -827.53 250.89 55.91 -520.73

8 Total Schedule Energy at T-D interface including UI

18,186.24 19,196.53 21,689.21 59,071.98

9 External & Transmission Losses (Mus) 172.48 1,173.68 807.66 2,153.83

10 Ex-Bus Requirement Schedule Energy as per MPPMCL Statement

18,358.73 20,370.21 22,496.87 61,225.81

Proposed methodology:

3.11 In this methodology, the licensee adopts the Hon’ble Aptel’s judgement, which states

that the actual power purchases are to be considered for computation of excess losses.

Illustrative calculations are shown below:

Table 13: Calculation of disallowed units as per proposed methodology

Actual power purchase = 100 units

Excess loss% as per Table 26 = 5.5%

Excess loss incurred = 5.5 units (i.e. 100 units x 5.5%)



Allowable power purchases

= Actual power purchase – Excess loss incurred

= 100 units – 5.5 units

= 94.5 units

Total disallowed units = 100 units – 94.5 units

= 5.5 units (2)

It can be observed from Table 9: Calculation of disallowed units as per existing

methodology and Table 13: Calculation of disallowed units as per proposed

methodology that there is a difference of 2.9 units (i.e. 8.4 units – 5.5 units) in the total

disallowed losses. As a result, the licensee has to bear the cost of additional

disallowance of 2.9 units. Therefore quantum of power purchase should be disallowed

by only 5.5 units by adopting the top down approach that starts with power purchases

on which losses are calculated.

3.12 To sum up the bottom to top methodology results in a compounded effect which

unfairly enhances the amount of disallowed costs. It may be further highlighted, that,

the terms and phrases like “normative quantum” or “allowed or disallowed quantum”

of energy are erroneous and inappropriate and they have been used only to illustrate the

logic and reasoning involved. The only concrete terms are total energy purchased, the

total cost of power procurement, disallowed costs and allowed costs. Hence, the

Hon’ble Commission should consider the total quantum of power procured as the given

quantity and deal only in terms of allowed and disallowed costs corresponding to excess

of loss level over the normative loss level. The terms “allowed” or “disallowed

quantum” of energy may be altogether dispensed with and the entire actual quantum of

energy purchased should be accepted and recognized- a quantity which is indisputable

and which cannot and should not be altered retrospectively without any adequate

reference to the various factors and situations existing at the time.

3.13 In light of the above discussions, the loss levels mentioned pertain only to the losses

occurring within the Discoms’ periphery. However, MPERC may not disallow losses

occurring outside the Discom periphery (i.e. the inter-state and intra-state transmission

losses) on the basis of the normative quantum of energy required at the Discoms’

periphery. In principle, this approach requires proper attention to the factors and

mechanisms involved. The Discoms cannot have any material control over the losses

occurring outside their periphery- not the least because they are external to its

boundaries and involving a complex interconnected grid with numerous points,

directions and routes for entry and exit of power, but also because they actually are

“apportioned losses”, or so to say, “deemed losses” based on a working rule or formula

adopted for State-wise and Discom-wise segregation of the pooled energy losses

occurring in the inter-regional/state and intra-state transmission systems. As a matter of

a significant detail, the inter-region/state transmission losses are themselves

apportioned to a particular state from the energy appearing as pooled transmission

losses under the inter-region/state energy accounting mechanism (i.e. the so called

balancing and settlement mechanism). Thus, these losses are, so to say “re-apportioned”

and allocated to the Discoms operating in a particular state- that is energy “apportioned”



out of energy already “apportioned”- that is, it involves cascaded apportioning.

Similarly, the intra-state transmission losses have to be apportioned to the Discoms

according to some working rule- rather than a precise measurement. In this sense, the

transmission losses, with reference to a particular Discom, are entirely a notional

quantity – with one of its component being a “doubly notional” quantity- rather than a

real measured variable. Therefore, it can be stated firmly and with proper reasoning,

that the Hon’ble Commission may not tamper with and modify the quantum of energy

loss apportioned to the licensee which is traditionally termed and indicated as the losses

occurring in the inter/intra state transmission systems.

3.14 Proposed methodology for calculating power purchase cost for disallowed units:

3.15 As per the existing methodology, the Hon’ble Commission allows an average power

purchase cost that includes both fixed cost as well as variable cost for the power

purchase quantum at ex-bus (which excludes UI, inter-Discom, inter-State sales and

Banking). Further, the Petitioners cannot have any material control on the losses outside

their periphery i.e. M.P. Transco and PGCIL losses as they are external to their

periphery and involve complex interconnected grid. Therefore it will be appropriate to

determine average per unit rate based on the net actual energy input at Discom periphery

for sale to retail consumers only, which is a real and authentic item and may not change

even after the closure of financial year. This would also take into account the sale and

purchase of electricity between the Discom including UI within the State and also

banking of power to other States. It is to be noted that calculation of average per unit

rate should not be based on purchase at ex-bus, which may be revised by way of

reconciliation of regional/State Energy Accounts even after the closure of the financial

year for which true-up has already been carried out.

3.16 The Hon’ble Commission is required to determine the cost of power purchase to be

adjusted (disallowed) in the revenue requirement of the Petitioners for the quantum of

power purchase disallowed by applying the basic principle that all such costs and

expenses on average basis, which the appellant may have avoided if the quantum of

power purchase disallowed has not been purchased. The fixed charges such as capacity

charges and other related commitment charges are payable to the generating companies

for long term and medium term contracted capacity, irrespective of actual drawal of

electricity. In addition the transmission and related charges payable to CTU, STU and

Load Despatch Centre, reimbursement of taxes, duties and other levies to generating

companies and transmission companies and similar such cost and expenses ought not

to be disallowed as they cannot be avoided by reducing the power purchase. The

variable charge (energy charge) that could have been saved on such purchase can only

be disallowed for adjustment in ARR.

3.17 To avoid such complex method, it would be appropriate to disallow the % of variable

cost of power purchase which is more than the % of normative loss level and thus

balance cost of power purchase ought to be allowed, which is elaborated as per the

calculation as given below.



Table 14: Calculation of cost of disallowed power purchase units as per proposed methodology

Actual power purchase cost = Rs. 100

Fixed charges = Rs. 30

Variable charges = Rs. 70

Excess loss% as per Table 26 = 5.5%

Cost to be disallowed on account

of excess loss

= 5.5% * Rs. 70

= Rs. 3.85

Allowable power purchase cost

= Actual power purchase cost – Cost towards excess loss

= Rs. 100 – Rs. 3.85

= Rs. 96.15

3.18 In view of above the Power Purchase cost for the year 2016-17 may please be

considered as indicated in the following tables:-

Table 15: Details of power purchase cost to be allowed for East Discom FY 2016-17 (Rs Cr)

Sr. no.

Particulars Actual PP to be allowed

Deviation

1 Distribution Loss Level (%) 22.61% 18.00% 4.61%

2 Fixed Cost for FY 2016-17 2,938.39 2,938.39 -

3 Supplementary Bills of Previous FYs 368.40 364.62 3.78 Variable Cost for FY 2016-17 3,559.85 3,559.85

Less: Sale of additional power 155.69

Less: Other income 222.40

4 Variable Cost for FY 2016-17 after adjusting the sale of additional power and other income

3,181.76 3,035.08 146.68

5 Other Charges (ED, Cess, Heavy Water Charges, Water Charges, MOPA, Insurance, Others etc.)

323.41 308.50 14.91

6 Inter State Transmission Charges for FY 2016-17 including SLDC 437.08 437.08 -

7 Other Cost of MPPMCL which cannot be apportioned 66.03 66.03 -

8 Other Adjustment based on Reconciliation with MPPPMCL 48.23 46.00 2.22 MPPMCL Cost 7,363.30 7,195.71 167.59

A Sup. Bill Due to revision of SEA for the FY 14-15 (1.73) (1.73) -

B Intra State Transmission Charges for FY 2016-17 789.14 789.14 -

C Power Purchased Directly by Discoms 4.96 4.96 -

D DSM/UI at Intra State Boundary (109.57) (109.57) -

E Reactive Energy Charges (6.13) (6.13) -

Total 8,039.97 7,872.38 167.59

Table 16: Details of power purchase cost to be allowed for Central Discom FY 2016-17 (Rs Cr)

Sr. no.


Deviation


2 Fixed Cost for FY 2016-17 3,089.28 3,089.28 -


Less: Sale of additional power 165.73



Sr. no.


Deviation

Less: Other income 246.17


3,405.32 2,821.29


337.77 279.84 57.93



8 Other Adjustment based on Reconciliation with MPPPMCL 13.38 11.09 2.30 MPPMCL Cost 7,734.95 7,087.73 647.22

A Sup. Bill Due to revision of SEA for the FY 14-15 (74.99) (74.99)

B Intra State Transmission Charges for FY 2016-17 944.37 944.37 -

C Power Purchased Directly by Discoms - - -

D DSM/UI at Intra State Boundary 79.55 79.55 -

E Reactive Energy Charges 2.89 2.89 -

Total 8,686.77 8,039.55 647.22

Table 17: Details of power purchase cost to be allowed for West Discom FY 2016-17 (Rs Cr)

Sr. no.


Deviation


2 Fixed Cost for FY 2016-17 3,553.95 3,553.95 -


Less: Sale of additional power 180.80 Less: Other income 282.00


3,662.77 3,594.10


361.59 354.81 6.78



8 Other Adjustment based on Reconciliation with MPPPMCL (91.55) (89.84) (1.72) MPPMCL Cost 8,562.63 8,485.23 77.40

A Sup. Bill Due to revision of SEA for the FY 14-15 - -

B Intra State Transmission Charges for FY 2016-17 1,149.60 1,149.60 -

C Power Purchased Directly by Discoms - -

D DSM/UI at Intra State Boundary 41.48 41.48 -

E Reactive Energy Charges (1.13) (1.13) -

Total 9,752.58 9,675.18 77.40

3.19 Comparison of power purchase cost as per Commission Methodology & Proposed

Methodology by petitioners



3.19.1 There is an overall difference of Rs 158.72 Cr which will be allowed additionally to the

petitioners if the proposed methodology as proposed by the petitioners is adopted by

Hon’ble Commission.

3.19.2 Petitioners humbly request Hon’ble Commission to consider the methodology as

proposed by it for allowance of power purchase cost. The details of variation is

tabulated as shown below.

Table 18: Comparison of Costs – Commission’s Methodology Vs Petitioner’s Methodology (Rs Cr.)

Sr.no Particulars East Central West MP State

1 Power Purchase Cost as per Commission’s Methodology

7,847.58 7,902.38 9,678.42 25,428.38

2 Power Purchase Cost as per proposed Methodology by petitioners

7,872.38 8,039.55 9,675.18 25,587.10

3 Difference 24.80 137.17 (3.25) 158.72



T4: OPERATION & MAINTENANCE COST

4.1 The Commission‘s Regulations on Terms and Conditions for Determination of Tariff

for Supply and Wheeling of Electricity and methods and Principles for Fixation of

Charges) Regulations, 2015 define the norms of O&M Expenses of each licensee.

4.2 As per para 34.1 of above mentioned regulations, 2015, O&M expenses shall be

determined for the Tariff Period based on normative O&M expenses specified by the

Commission in these Regulations. The O&M expenses comprise of employee cost,

repairs & maintenance (R&M) cost and administrative & general (A&G) cost. The

norms for O&M expenses have been fixed on the basis of past audited figures of the

Distribution Licensees. These norms exclude dearness allowance, pension, terminal

benefits and incentive to be paid to employees, taxes payable to the Government,

MPSEB expenses and fee payable to MPERC. The Distribution Licensee shall claim

the dearness allowance, pension and terminal benefits, taxes payable to the Government

and fees to be paid to MPERC separately as actual. The claim of expenses towards

pension and terminal benefits shall be dealt with as indicated in the MPERC (Terms

and Conditions for allowing pension and terminal benefits liabilities of personnel of

Board and successor entities) regulations, 2012.

4.3 Hon’ble Commission had approved net O&M Expenses to the extent of Rs. 1247.07

Cr, Rs 1113.96 and Rs 1200.37 Cr for East Discom, Central Discom and West Discom

respectively in its Tariff order for FY 2016-17, which was based on the norms as

provided in the Terms and Conditions of Tariff Regulation, 2015.

4.4 The claim of the petitioners towards the true up of O&M cost for FY 2016-17 is

submitted as below for Hon’ble Commission’s kind perusal and consideration.

Table 19: Details of O&M cost claimed towards true up of FY 2016-17

Sr. no.

Particulars Index Discom Allowed in TO (A)

Claimed (B)

Variance (B-A)

1 Employee Cost (Including terminal benefits)

Rs Cr EZ 920.58 814.28 106.30

Rs Cr CZ 839.91 906.47 (66.56)

Rs Cr WZ 947.89 761.03 186.86

Rs Cr MP State 2,780.37 2,481.77 298.60

3 Administrative & General Expenses including MPERC Fees

Rs Cr EZ 168.50 212.30 (43.80)

Rs Cr CZ 96.50 98.49 (1.99)

Rs Cr WZ 129.50 143.38 (13.88)

Rs Cr MP State 394.50 454.17 (59.67)

4 Repair & Maintenance Expenses

Rs Cr EZ 158.00 174.16 (16.16)

Rs Cr CZ 177.56 130.51 47.05

Rs Cr WZ 122.99 123.48 (0.49)

Rs Cr MP State 458.54 428.15 30.39

5 Total O&M Charges

Rs Cr EZ 1,247.07 1,200.74 46.33

Rs Cr CZ 1,113.96 1,135.46 (21.50)

Rs Cr WZ 1,200.37 1,027.89 172.48

Rs Cr MP State 3,561.40 3,364.10 197.31



4.5 Submission of East Discom:

4.5.1 For FY 2016-17, O&M expenses are Rs 1220.74 Cr. which comprises of employees

expenses to the tune of Rs. 805.05 Cr (expense capitalised Rs 31.09 Cr and net expense

is Rs 783.19 Cr), R&M expenses to the tune of Rs. 174.16 Cr (expense capitalised Rs

27.10 Cr and net expense is Rs 147.06 Cr) and A&G expenses Rs 212.30 Cr. The

petitioner is also claiming the cost of actual cash outflow towards terminal benefits to

the tune of Rs 9.22 Cr which is not a part of Transco’s ARR.

4.5.2 Therefore, it is submitted that O&M expenses as per the claim of the petitioner to

the tune of Rs 1220.74 Cr for FY 2016-17 may please be considered towards true

up.

4.6 Submission of Central Discom:

4.6.1 The petitioner hereby requests the Hon’ble Commission to allow Rs. 906.46 Cr

including of terminal benefits of Rs. 186.41 Cr towards Employee expenses, A&G

expenses of Rs. 98.49 Cr, and R&M expenses of Rs. 123.48 Cr for FY 2016-17.


the tune of Rs 1,135.46 Cr for FY 2016-17 may please be considered towards true

up.

4.7 Submission of West Discom

4.7.1 The petitioner hereby requests the Hon’ble Commission to allow Rs. 761.03 Cr

including of terminal benefits of Rs. 14.84 Cr towards Employee expenses, A&G

expenses of Rs. 143.38 Cr, and R&M expenses of Rs. 123.48 Cr for FY 2016-17.


the tune of Rs 1,027.89 Cr for FY 2016-17 may please be considered towards true

up.



T5: INTEREST & FINANCE CHARGES

5.1 Interest on Project Loans

The Hon’ble Commission in its Tariff Order dated 5th April 2016 had approved Interest

on Project Loans as Rs. 225.28 Cr for the East Discom, Rs. 284.20 Cr for the Central

Discom, Rs 84.86 Cr for the West Discom and Rs. 594.34 Cr for the MP State

respectively.

5.1.1 Submission of East Discom:

5.1.1.1 The actual/accrued interest on project loans of the petitioner for the year FY 2016-17 is

Rs 216.26 Cr. The weighted average rate of interest worked out based on the actual

project loans has been utilised for the calculation of interest on project loans as per the

normative basis.

5.1.1.2 The details of the claim of the petitioner towards interest and finance charges is shown

as below in the following table

Table 20: Details of Finance Charges Claimed by East Discom for True-up FY 2016-17 (Rs Cr)

Particulars Approved in Tariff Order

Claimed

Opening Debt associated with GFA (as on 01st April 2016 as Per FY 2015-16 True-up Petition)

212.22

1,055.27

GFA Addition During the Year 823.31

Consumer Deposit and Grants utilized during the year 216.66

Net GFA Addition during the Year 606.65

70% of addition to net GFA considered as funded through Debt 424.66

Debt repayment during the FY (Equal to Depreciation) 303.80

Closing debt associated with GFA 1,176.13

Average debt associated with GFA 1,115.70

Weighted Average Interest Rate (%) 9.40%

Interest on Project Loan 104.88

Add: Other Finance Cost

13.06

Bank Commission & Other Charges 1.99

Cost of Raising Finance, Guarantee Charges & Stamp Duty, Commitment Charges

59.62

Penalty Charges of Delayed Payment or Rebate to Consumers on Timely Payment

2.47

Net Interest on Project Loan 225.28 168.96

5.1.2 Submission of Central Discom

5.1.2.1 The actual net interest payments against current dues in FY 2016-17 (excluding any

payments against previous year defaults of principal or interest or any penal charges on

such defaults) is Rs. 148.62 Cr (the total of Rs. 171.24- Interest capitalised to project

works Rs. 22.62 Cr).



5.1.2.2 The details of the claim of the petitioner towards interest and finance charges for project

loans is shown as below in the following table

Table 21: Details of Finance Charges Claimed by Central Discom for True-up FY 2016-17 (Rs Cr)

Particulars Approved in Tariff Order

Claimed

Total interest payments against current dues in financial year (not including any payments against previous year defaults of principal or interest or any penal charges on such defaults)

171.24

Interest capitalized to project works 22.62


5.1.3 Submission of West Discom

5.1.3.1 The actual/accrued interest on project loans of the petitioner for the year FY 2016-17 is

Rs 216.26 Cr. The weighted average rate of interest worked out based on the actual

project loans has been utilised for the calculation of interest on project loans as per the

normative basis.

5.1.3.2 The details of the claim of the petitioner towards interest and finance charges is shown

as below in the following table

Table 22: Details of Finance Charges claimed by West Discom for True-up of FY 2016-17

Particular Approved in Tariff Order

Claimed

A

Opening Debt associated with GFA

(as on 01st April 2016 as Per FY 2015-16 True-up

Petition)

578.15

B GFA Addition During the FY 590.24

C Consumer Deposit and Grants utilized during the FY 411.67

D Net GFA Addition during the FY 178.57

E 70% of addition to net GFA

considered as funded through debt 125.00

F Debt repayment during the FY (Equal to Depreciation) 237.30

G Closing debt associated with GFA 465.85

H Average debt associated with GFA 522.00

I Weighted Average Interest Rate (%) 11.61%

J Interest on Project Loan 75.09 60.63

K Add: Other Finance Cost 14.85

i Bank Commission & Other Charges 9.77 6.81

ii Cost of Raising Finance, Gurantee Charges & Stamp Duty,

Commitment Charges 7.48

iii Penalty Charges of Delayed Payment or Rebate to

Consumers on Timely Payment 0.55




5.1.4 West Discom thus requests the Hon’ble Commission for the approval of Interest and

Finance Charges of Rs. 75.47 Cr on account of true up towards Interest on project loan.

5.2 Interest on Working Capital Loans

5.2.1 The Commission in the Tariff Order for FY 2016-17 has allowed Rs. 74.92 Cr for East

Discom, Rs. 31.96 Cr for Central Discom and NIL for West Discom as interest on the

working capital as per the norms specified in the Regulation.

5.2.2 Submission of East Discom:

5.2.2.1 The petitioner submits that the interest on working capital approved in the tariff order

was Rs 74.92 Cr which was based on the norms as specified in the terms and conditions

of tariff regulations, 2015.

5.2.2.2 The petitioner submits that it has computed the interest on working capital component

as per the provisions of regulations. The interest on working capital as claimed by the

petitioner towards true up of FY 2016-17 is Rs 57.29 Cr.

5.2.2.3 The detailed computation of the same is submitted hereby for Hon’ble Commission’s

kind perusal.

Table 23: Details of Interest on Working Capital Claimed by East Discom in True up of FY 2016-17

Sr. no.

Particulars Allowed in Tariff Order

Actual as per Regulations

(A) 1/6th of annual requirement of inventory for previous year at 1 % GFA for previous year (80%)

9.16 49.35

(B) Total of O&M expenses 1,247.07 1,200.74

(B)( i) 1/12th of total 103.92 100.06

(C) Receivables - -

(C) (i) Annual Revenue from wheeling charges** - -

(C) (ii) Receivables equivalent to 2 months average billing of wheeling charges

- -

(D) Total Working capital (A)+( B)( i)+(C)(ii) 113.08 149.41

(E) Rate of Interest * 14.05% 14.05%

(F) Interest on Working capital -wheeling 15.89 20.99

Sr. no.



(A) 1/6th of annual requirement of inventory for previous year (20%)

2.29 12.34

(B) Receivables -

(B)( i) Annual Revenue 8,631.99 7,443.06

(B)(ii) Receivables equivalent to 2 months average billing 1,438.67 1,240.51

(C) Power Purchase expenses 6,007.00 5,973.48

(C)(i) 1/12th of power purchase expenses 500.58 497.79

(D) Consumer Security Deposit 520.24 646.12



Sr. no.



(E) Total Working capital (A)+(B)( ii) – (C)( i) – (D) 420.14 108.94

(F) Rate of Interest * 14.05% 14.05%

(G) Interest on Working capital -Retail 59.03 15.31

Total Interest on Working capital -Wheeling 15.89 20.99

Net Interest on Working capital -Retail 59.03 15.31

Total Interest on Working Capital (Wheeling +Retail) 74.92 57.29


5.2.3.1 Interest on Working Capital as approved in the Tariff order for the period FY16-17 was

Rs. 14.49 Cr for Wheeling activity and for Retail activity it was Rs.17.47 Cr. However,

the actual interest on Working Capital for the Licensee is Rs. 121.53 Cr as per Actuals

for FY 2016-17.

5.2.3.2 It is worthwhile to mention that every organization needs funds for short-term purposes

to finance current Investment in short term assets like cash, inventories, debtors etc.

Every organization needs working capital for carrying out day-to-day operations

smoothly. Even an organization which is fully equipped with all types of fixed assets

required is bound to collapse without adequate Working capital. Working Capital is

thus like the lifeline for a business. It is submitted that licensees have also borrowed

fund as Working Capital Loan from GoMP/Banks & FI’s to meet out their day-to-day

expenses, on which GoMP charges interest and is payable by the licensees.

5.2.3.3 Thus the licensee hereby prays to Hon’ble Commission to allow interest on

working capital as per actuals of the audited accounts to meet out its actual

expenditure incurred in FY 2016-17 and allow expenses on account of interest on

Working Capital to the tune of Rs. 121.53 Cr.


5.2.4.1 The petitioner submits that Hon’ble Commission in its tariff order dated 5th April’2016

had not allowed any interest on working capital in respect of West Discoms as per the

norms specified in the Terms & Conditions of Tariff Regulations, 2015.

5.2.4.2 The petitioner submits that it has computed the interest on working capital component

as per the provisions of regulations. The interest on working capital as claimed by the

petitioner towards true up of FY 2016-17 is Rs 25.10 Cr.

5.2.4.3 The detailed computation of the same is submitted hereby for Hon’ble Commission’s

kind perusal.



Table 24: Details of Interest on Working Capital Claimed by West Discom in True up of FY 2016-17

A Interest on Working Capital - Retail As per the

Tariff Order As per the

Regulations

Inventory - 20% of 2 Month Proportionate of 1% GFA 1.78 1.79

O&M Expenses - 10% of 1 Month Proportionate - 8.57

Revenue from Retail -2 Month 1,575.56 1,754.84

Gross Working Capital Requirement 1,577.34 1,765.20

Less: Power Purchase Cost - 1 Month 552.69 806.26

Less: Consumer Security Deposit 1,162.74 864.51

Net Working Capital Requirement (138.09) 94.43

Interest Rate on Working Capital (%) 14.05% 14.05%

Interest - Retail (19.40) 13.27

B Interest on Working Capital - Wheeling As per the Tariff Order

As per the Regulations

Inventory - 80% of 2 Month Proportionate of 1% GFA 7.13 7.16

O&M Expenses - 90% of 1 Month Proportionate 100.03 77.09

Revenue from Wheeling - 2 Month 0.48 0.52

Net Working Capital Requirement 107.64 84.77

Interest Rate on Working Capital (%) 14.05% 14.05%

Interest - Wheeling 15.12 11.91

C Interest on Working capital (Retail + Wheeling) - 25.18

5.3 Interest on Consumer Security Deposit

5.3.1 Interest on Consumer Security Deposit (CSD) approved in the Tariff Order for the

period FY 2016-17 was Rs 40.32 Cr, Rs 61.87 Cr and Rs 90.11 Cr for East Discom,

West Discom and Central Discom respectively.

5.3.2 Hon’ble Commission approved the interest on consumer security deposit which was

based on the Security Deposit Regulations, 2005 read with subsequent Amendments to

the Regulations and the Terms and Conditions of Tariff Regulation, 2015.

5.3.3 However, the actual Interest on consumer security deposits for the period FY 2016-17

for the East Discom was Rs 50.57 Cr, Central Discom was Rs 54.87Cr and West

Discom was Rs 62.99 Cr.

5.3.4 The details of the consumer security deposit and the interest paid on the same for the

year is submitted hereby for Hon’ble Commission’s kind perusal.

Table 25: Details of Interest on Consumer Security Deposit claimed for the year FY 2016-17

Discom Allowed in the Tariff Order

Actual as per Accounts

Variance

EZ 40.32 50.57 (10.25)

CZ 61.87 54.87 7.00

WZ 90.11 62.99 27.12

MP State 192.30 168.43 23.87



5.3.5 The petitioners thus prays to allow Rs. 168.43 Cr on account of Interest on Consumer

Security Deposits for FY 2016-17.

5.4 Summary of Interest and Finance Charges

5.4.1 The petitioners hereby submit that an amount of Rs 276.82 Cr, Rs 325.02 Cr and Rs

163.64 Cr may be kindly approved against interest and finance charges for East Discom,

Central Discom and West Discom respectively towards true up of FY 2016-17.

5.4.2 The summary of the interest and finance charges is shown in the table below:

Table 26: Summary of Interest and Finance Charges claimed towards True up of FY 2016-17

Sr. no.

Source Index Discom Allowed in the Tariff

Order

Actual as per Accounts/ regulation

Variance

1 Interest and Finance charges on Project Loans

Rs Cr EZ 225.28 168.96 56.32

Rs Cr CZ 284.20 148.62 135.58

Rs Cr WZ 84.86 75.47 9.39

Rs Cr MP State 594.34 393.05 201.29

2

Interest on Working Capital Loan Claimed as per regulation/audited accounts

Rs Cr EZ 74.92 57.29 17.63

Rs Cr CZ 31.96 121.53 (89.57)

Rs Cr WZ - 25.18 (25.18)

Rs Cr MP State 106.88 204.00 (97.12)

3 Interest on consumer Security Deposit as per accounts

Rs Cr EZ 40.32 50.57 (10.25)

Rs Cr CZ 61.87 54.87 7.00

Rs Cr WZ 90.11 62.99 27.12

Rs Cr MP State 225.28 168.43 56.85

4 Total Interest & Finance Charges (1+2+3)

Rs Cr EZ 340.52 276.82 63.70

Rs Cr CZ 378.03 325.02 53.01

Rs Cr WZ 174.97 163.64 11.33

Rs Cr MP State 893.52 765.48 128.04



T6: DEPRECIATION AND RELATED DEBITS

6.1 Hon’ble Commission in its Tariff Order dated 5th April 2016 had approved

depreciation net of consumer contribution & grants as Rs. 134.91 Cr for the East

Discom, Rs. 161.46 Cr for the Central Discom and Rs. 106.91 Cr for the West Discom

respectively

6.2 As per the Second Amendment to MPERC (Recovery of expenses and other charges

for providing Electric Line or Plant used for the purpose of giving Supply) (Revisions-

I) Regulations, 2009 (RG-31(I) of 2009), the manner of the recognition of asset created

through consumer contribution as well as depreciation thereon has been elaborated.

Further Accounting Standard 12, provides guidance on the asset created through

government grant. Accordingly, as per provision of the Regulation, Discom can charge

depreciation on the full amount of asset and amortizes the corresponding amount from

grant to the P&L account. Therefore, treatment given by the Discom in the accounts is

in line with the Regulation (RG-31) and prevailing Accounting Standards.

6.3 Further, the Petitioner’s adopted the rate of depreciation notified by the Hon’ble

Commission in Regulation from the FY 2010-11 as per the clarification issued by the

Ministry of Corporate Affairs vide general circular No 31/2011 dated 31st May 2011.

Since, Discoms adopted rate of Regulation only from FY 2010-11, a separate

depreciation model was used to consider depreciation as per regulation since FY 2006-

07. Accordingly, the Petitioner’s (West Discom) has considered the Depreciation for

FY 2016-17.

6.4 Depreciation has been charged in the books of the Licensee for the Assets capitalized

during the year and as the beginning of the year in consistent with the rates of

depreciation specified in MPERC (Terms and Conditions for Determination of Tariff

for Supply and Wheeling of Electricity and Methods and Principles for Fixation of

Charges) Regulations, 2015 regulation, details are as given in the table below:

Table 27: Details of Depreciation Claimed by petitioners for FY 2016-17

Sr. no.

Discom Actual Claimed now as Per Regulation /

Accounts (A)

Allowed in the Tariff Order

(B)

Variance (A-B)

1 EZ 134.91 303.80 (168.89)

2 CZ 161.46 272.54 (111.08)

3 WZ 106.91 237.30 (130.39)

4 MP State 403.29 813.63 (410.34)


6.5.1 The Licensee hereby prays to the Hon’ble Commission to allow depreciation of Rs

303.80 Cr as per the audited accounts over against the approved depreciation of

Rs.134.91 for East Discom in the Tariff Order for the period FY 2016-17.

6.6 Submission of Central Discom



6.6.1 The Licensee hereby prays to the Hon’ble Commission to allow depreciation of Rs

272.54 Cr as per the audited accounts over against the approved depreciation of

Rs.161.46 for Central Discom in the Tariff Order for the period FY 2016-17.


6.7.1 The petitioner has calculated the depreciation of Rs. 237.30 Cr as per regulations for

FY 2016-17 based on the detailed depreciation model used for working out is also being

submitted as an Annexure.

6.7.2 In view of the above, the petitioner requests the Hon’ble Commission may kindly

approve the amount of Rs 237.30 towards true up of depreciation for FY 2016-17.



T7: BAD AND DOUBTFUL DEBTS

7.1.1 The Hon’ble Commission in its Tariff Order for FY 2016-17 dated 5th April 2016 had

approved bad debts amounting to Rs. 2 Cr for each Discom. The Petitioners has

considered the bad debts as per audited accounts for FY 2016-17 as shown below:

7.2 Submission of East Discom

7.2.1 However, actual Bad and Doubtful Debts as per Annual Accounts is Rs 182.25 Cr.,

which includes provisioning of Rs 81.36 Cr. And actual bad debts written off to the

tune of Rs 100.89 Cr.

7.2.2 The Petitioner has claimed only the actual bad debts to the tune of Rs 100.89 Cr. that

were actually written off in the annual accounts of FY 2016-17, which may be allowed

in true-up of FY 2016-17.


7.3.1 The petitioner submits that the actual bad and doubtful debts written off during the FY

2016-17 was Rs 277.46 Cr and the petitioner humbly submits the Hon’ble Commission

that it may kindly consider the claim of the petitioner in this regard towards true up of

bad debts for FY 2016-17.


7.4.1 The petitioner submits that the actual bad and doubtful debts written off during the FY

2016-17 was Rs 158.51 Cr and the petitioner humbly submits the Hon’ble Commission

that it may kindly consider the claim of the petitioner in this regard towards true up of

bad debts for FY 2016-17.

7.5 The claim of the petitioners is shown in the table for Hon’ble Commission’s kind

perusal and further consideration.

Table 28: Details of Bad and Doubtful debts Claimed by petitioners for FY 2016-17

Sr.no. Discom Allowed in the Tariff Order

Actual Claimed As Per Accounts

Variance

1 East Discom 2.00 100.89 (98.89)

2 Central Discom 2.00 277.46 (275.46)

3 West Discom 2.00 158.51 (156.51)

4 MP State 6.00 536.86 (530.86)



T8: OTHER EXPENSES


8.1.1 The licensee submits that the amount towards prior period credits including other

expenses is Rs 0.87 Cr. The details of the same are as shown in the table below:

Table 29: Other Expenses Claimed as true up for FY 2016-17

Sr.no. Particulars Allowed in the

Tariff Order

Actual Claimed As Per Accounts

1 Sundry Expenses/Miscellaneous Losses - 0.87

8.1.2 In view of the position explained above, the petitioner prays to the Hon’ble Commission

to approve the other expenses amounting to Rs 0.87 Cr on account of true up of FY

2016-17.

8.2 Exceptional Items

8.2.1 Submission of East Discom

8.2.1.1 It is submitted that with reference to a letter no. 7310/R-3483/2015/XIII, from PS

Energy, Bhopal dated 08/09/2016, M. P. Power Transmission Co. Ltd., Jabalpur has

written off liabilities of Discom to an extent of Rs. 148.73 Cr. This liability of wheeling

charges towards MPPTCL has reflected in P&L as other expenses item and has not

been claimed for the purpose of true-up.



T9: RETURN ON EQUITY

9.1 The Hon’ble Commission in its Tariff Order for FY 2016-17 dated 5th April 2016 had

approved return on equity as Rs. 255.26 Cr for East Discom, Rs. 305.92 Cr for Central

Discom and Rs. 180.81 Cr for West Discom respectively.

9.1.1 Submission of East Discom

The Petitioners submits that it has computed Return on Equity as per Tariff Regulations,

2015. The Petitioners hereby submits that it has considered the closing equity associated

with GFA (as on 31st March 2016 as per True-up Order for FY 2015-16). Since the

True-up Order for FY 2015-16 is still awaited the Petitioners has followed the same

methodology as per Tariff Regulations, 2015 and followed by the Hon’ble Commission

in previous True-Up Order to arrive at closing equity associated with GFA for FY 2014-

15 which inter-alia would be the opening equity associated with GFA for FY 2015-16

.Equity component of GFA addition equal to 30% of net addition in FY 2016-17 has

been considered as the equity addition. The Petitioners submits that it has computed

Return on Equity as per Section 30.2 of the Tariff Regulations, 2015 which specifies

that Return on Equity shall be computed on pre-tax basis @ 16% as below:

Table 30: ROE Claimed by EZ as true up for FY 2016-17

Sr. no.

Particulars Approved in the Tariff

Order (A)

Actuals

(B)

A Gross Fixed Assets at the beginning of year (net of consumer contributions)

4,703.51

A1 Opening balance of equity 1,832.80

B Actual capitalization of assets as per Annual Accounts (net of consumer contribution)

606.65

B1 Addition of equity, internal reserves during the year for capitalized assets

-

C1 Normative additional Equity (30% of B) 182.00

D1 Excess / shortfall of additional equity over normative (B1-C1) (182.00)

E Equity eligible for Return (A1+(C1/2)) OR (A1+(B1/2)), whichever is lower

1,832.80

F Return on Equity - (16% on E) 255.26 293.25


The Petitioners submits that it has computed Return on Equity as per Tariff Regulations,













Table 31: ROE Claimed by CZ as true up for FY 2016-17

Sr. no.


Order (A)

Actuals

(B)

A Gross Fixed Assets at the beginning of year (net of consumer contributions)

7,429.65

A1 Opening balance of equity 1,944.89

B Actual capitalization of assets as per Annual Accounts (net of consumer contribution)

1,196.02

B1 Addition of equity, internal reserves during the year for capitalized assets

C1 Normative additional Equity (30% of B) 358.81

D1 Excess / shortfall of additional equity over normative (B1-C1) (358.81)

E Equity eligible for Return (A1+(C1/2)) OR (A1+(B1/2)), whichever is lower

1,944.89

F Return on Equity - (16% on E) 305.92 311.18


9.2 The Petitioners submits that it has computed Return on Equity as per Tariff Regulations,











Table 32: ROE Claimed by WZ as true up for FY 2016-17

Sr. No.


Order (Rs. Crs.)

Actuals in (Rs. Cr)

A Opening Equity Identified with GFA (as on 01st April 2016 as Per FY 2015-16 True-up Petition)

1,023.51

B GFA Addition During the FY 590.24

C Consumer Deposit and Grants utilized during the FY 411.67

D Net GFA Addition during the FY 178.57

E 30% of addition to net GFA considered as funded through Equity

53.57

F Closing Equity Identified with GFA (as on 31st March 2017) 1,077.08

G Average Equity associated with GFA 1,050.30



Sr. No.


Order (Rs. Crs.)

Actuals in (Rs. Cr)

H Rate of Return on Equity (%) 16% 16%

I Return on Equity 180.81 168.05

9.3 The petitioners, thus prays the Hon’ble Commission to allow Return on Equity

amounting to Rs 293.25 Cr, Rs 311.18 and Rs -168.05 for East Discom, Central Discom

and West Discom respectively for FY 2016-17 as shown in below table .

Table 33: ROE Claimed by Petitioners for FY 2016-17

Sr. no.

Discom Allowed in the Tariff Order

Actual Claimed Now As Per Regulation / Accounts

Variance

1 East Discom 255.26 293.25 (37.99)

2 Central Discom 305.92 311.18 (5.26)

3 West Discom 180.81 168.05 12.76

4 MP State 741.99 772.48 (30.49)



T10: TAXES

10.1 The petitioners submits that for the period FY 2016-17 they have incurred a loss of Rs

787.76 Cr, Rs 1,267.20 Cr for East Discom, Central Discom and profit of Rs. 552.89

Cr West Discom respectively before tax and hence were not required to pay any Income

Tax.

T11: OTHER EXPENSES CAPITALISED


11.1.1 As per the Audited Accounts of FY 2016-17 the licensee has capitalised 103.64 Cr as

other expenses capitalised includes the capitalised employee expenses, capitalised

R&M Expenses and capitalised A&G Expenses.

Table 34: Other expenses capitalized claimed by East Discom for FY 2016-17

Sr. no.

Particulars As Approved in Tariff Order

Actual as per audited

accounts

1 Capitalization of base investment -

2 Capitalization of expenses:-- 103.64

Interest & Finance charges Capitalized 45.45

Employee expenses Not 31.09

R&M Expenses indicated in 27.10

A&G Expenses Tariff Order -

Others, if any -

3 Capitalization of depreciation, if any -

Grand Total (1+2+3) (103.64)

11.1.2 The licensee hereby prays to the Hon’ble commission to allow the other expenses

capitalised of Rs. 103.64 for FY 2016-17.

11.2 Submission of West Discom:

11.2.1 As per the Audited Accounts of FY 2016-17 the licensee has capitalised 96.06 Cr as

other expenses capitalised includes the capitalised employee expenses, capitalised

R&M Expenses and capitalised A&G Expenses and interest and finance charges

capitalised.

Table 35: Other expenses capitalized claimed by West Discom for FY 2016-17

Sr. no.



accounts

1 Capitalization of base investment -

2 Capitalization of expenses:-- 96.06

Interest & Finance charges Capitalized 57.75

Employee expenses Not 26.72

R&M Expenses indicated in 1.04

A&G Expenses Tariff Order 10.55



Sr. no.



accounts

Others, if any -

3 Capitalization of depreciation, if any -

Grand Total (1+2+3) (96.06)

11.2.2 The licensee hereby prays to the Hon’ble commission to allow the other expenses

capitalised of Rs. 96.06 for FY 2016-17.

T12: OTHER INCOME

12.1 The Hon’ble Commission in its Tariff Order for FY 2016-17 dated 5th April 2016 had

approved other income and non-tariff income as Rs. 251.99 Cr for the East Discom, Rs.

212.25 Cr for the Central Discom and Rs. 206.26 Cr for the West Discom respectively.

12.2 The Petitioners have claimed other income and non-tariff income as per the audited

accounts of FY 2016-17 as per below table.

Table 36: Other income claimed by Petitioners for FY 2016-17

Sr. no. Discom Allowed in the Tariff Order

Actual Claimed Now As Per Regulation / Accounts

Variance

1 East Discom 251.99 269.96 (17.97)

2 Central Discom 212.25 212.28 (0.03)

3 West Discom 206.26 133.00 73.26

4 MP State 670.49 615.24 55.25

12.3 The Petitioner (West Discom) has received Rs. 2.92 Cr (out of Rs. 133 Cr) from

MPAKVN for extending its service towards operation & maintenance of MPAKVN

distribution assets. The Petitioner has already intimated the Hon’ble Commission about

this contract vide its letter no MD/WZ/05/9376 dated 29th April 2013.

12.4 The Hon’ble Commission vide its Tariff Regulations, 2012 has stated vide clause 40.2

that

“Revenue from other business shall be treated as income to the extent authorized by

the Commission under Section 41 of the Act”.

12.5 The Petitioners has also complied with the provisions of MPERC (Treatment of Income

of Other Businesses of Transmission Licensees and Distribution Licensee) Regulation

2004 in this regard.

12.6 As per Section 51 of the Electricity Act

“A distribution licensee may, with prior intimation to the Appropriate Commission,

engage in any other business for optimum utilization of its assets”.



12.7 The Petitioners (West Discom) humbly submits that it has earned such income due to

its efficiency. Hence, it is proposed not to share the income earned through other

business to the extent of Rs. 2.92 Cr as it is not counting the same as part of Other

Income. In view of this, the Petitioners requests the Hon’ble Commission to approve

the amount claimed as above on account of net other income towards the true up of FY

2016-17.

12.8 The Petitioners hereby pray to the Hon’ble Commission to approve Rs. 269.96 Cr for

the East Discom, Rs. 212.28 Cr for the Central Discom and Rs. 133 Cr for the West

Discom respectively for FY 2016-17 as other income and non-tariff income as

submitted above.



T13: INCOME FROM SALE OF POWER

13.1 Submission of East Discom

13.1.1 The Licensee hereby submits that the Hon’ble Commission had considered sales of

15,730 MU that were submitted in the Tariff Petition for the period FY 2016-17.

However, the actual sales were lower by 2320.10 MU than what has been approved in

the Tariff order for FY 2016-17. The revenue from sales has also been lower by Rs.

1586.23 Cr. The details are shown in the table below:

Table 37: Revenue from Sales for East Discom FY 2016-17

Particulars

As per Tariff Order (A)

Actuals (B) Variance (B-A)

Sales (MU)

Revenue (Rs. Cr)

Sales (MU)

Revenue (Rs. Cr)

Sales (MU)

Revenue (Rs. Cr)

LOW TENSION 10,993 5,736 10,462.62 5,288.29 (530.38) (447.71)

LV 1: Domestic 4,569 2,438 3,766.11 1,814.45 (802.89) (623.55)

LV 2: Non-Domestic 848 648 1,043.15 674.66 195.15 26.66

LV 3: Public Water Works & Street Lights

596 295 423.52 187.04 (172.48) (107.96)

LV 4: LT Industry 363 265 392.55 263.87 29.55 (1.13)

LV 5: Irrigation pump for Agriculture 4,617 2,090 4,837.29 2,348.27 220.29 258.27

HIGH TENSION 4,736 3,269 2,946.28 2,108.53 (1,789.72) (1,160.47)

HV 1: Railway Traction 672 442 - - (672.00) (442.00)

HV 2: Coal Mines 504 378 460.02 342.24 (43.98) (35.76)

HV-3: Industrial & Non-Industrial 3,149 2,211 2,098.88 1,536.55 (1,050.12) (674.45)

HV-4: Seasonal 11 7 7.41 6.54 (3.59) (0.46)

HV-5: HT Irrigation & Water Works 108 61 99.61 57.10 (8.39) (3.90)

HV 6: Bulk Residential Users 292 170 280.20 165.98 (11.80) (4.02)

HV 7: Start-Up power - - 0.16 0.13 0.16 0.13

GRAND TOTAL HT + LT 15,730 9,005 13,408.90 7,396.83 (2,320.10) (1,608.17)

GRAND TOTAL HT + LT as per R-15 (Excluding ED, CESS, Meter Rent, Surcharge, Misc. Charges etc.)

13,408.90 -

GRAND TOTAL HT + LT as per Audited Accounts

9,005

6,340.50 (1,561.94)

Subsidy as per audited Accounts 1,102.56

Total Sales of power including subsidy

9,005 7,443.06 (1,561.94)

Less: Additional Power Purchase Cost of FY 2006-07 borne by GoMP as subsidy

24.29

Total Revenue from Sales of power including subsidy

9,005 7,418.77 (1,586.23)

13.2 The Actual income from sale of power indicated in the audited accounts including

subsidy is Rs 7418.77 Cr.



13.3 The Licensee thus prays to the Hon’ble Commission to consider Rs. 7418.77 Cr. as

Income from sales of power as per the audited accounts of the company, for the purpose

of deciding of True-up.


13.4.1 The Licensee hereby submits that the Hon’ble Commission had considered sales of

15,029 MU that were submitted in the Tariff Petition for the period FY 2016-17.

However, the actual sales were lower by 2718 MU than what has been approved in the

Tariff order for FY 2016-17. The revenue from sales has also been lower by Rs. 1626

Cr. The details are shown in the table below:

Table 38: Revenue from Sales for Central Discom FY 2016-17

Particulars

As per Tariff Order (A)

Actuals (B) Variance (B-A)

Sales (MU)

Revenues (Rs. Cr)

Sales (MU)

Revenues (Rs. Cr)

Sales (MU)

Revenues (Rs. Cr)

LOW TENSION 10,623 5,991 9,257.95 5,316.48 (1,365.05) (674.52)

LV 1: Domestic 4,639 2,686 3,503.39 2,036.65 (1,135.61) (649.35)

LV 2: Non-Domestic 901 712 825.78 669.70 (75.22) (42.30)


407 208 325.89 177.09 (81.11) (30.91)

LV 4: LT Industry 301 217 252.88 210.03 (48.12) (6.97)

LV 5: Irrigation pump for Agriculture 4,375 2,168 4,350.02 2,223.01 (24.98) 55.01

HIGH TENSION 4,405 3,082 3,051.19 2,008.51 (1,353.81) (1,073.49)

HV 1: Railway Traction 1,195 813 - - (1,195.00) (813.00)

HV 2: Coal Mines 35 30 30.95 26.09 (4.05) (3.91)

HV-3: Industrial & Non-Industrial 2,826 2,044 2,666.91 1,784.73 (159.09) (259.27)

HV-4: Seasonal 2 1 1.65 1.61 (0.35) 0.61

HV-5: HT Irrigation & Water Works 170 92 190.83 101.32 20.83 9.32

HV 6: Bulk Residential Users 177 102 150.68 89.09 (26.32) (12.91)

HV 7: Start-Up power - - 10.17 5.67 10.17 5.67

GRAND TOTAL HT + LT 15,029 9,072 12,309.14 7,324.99 (2,718.86) (1,748.01)

GRAND TOTAL HT + LT as per R-15 (Excluding ED, CESS, Meter Rent, Surcharge, Misc. Charges etc.)

12,309.14 -

GRAND TOTAL HT + LT as per Audited Accounts

9,072

6,144.71 (1,626.35)

Subsidy as per audited Accounts 1,908.96

Total Sales of power including subsidy

9,072 8,053.67 (1,626.35)

Less: Additional Power Purchase Cost of FY 2006-07 borne by GoMP as subsidy

41.56

Total Revenue from Sales of power including subsidy

9,005 8,012.11 (1,059.89)



13.4.2 The actual income as per the audited accounts including subsidy is Rs. 8,012.11 Cr.

Accordingly the Licensee prays the Hon’ble Commission to consider Rs. 8,012.11 Cr

as Income from sales of power for the purpose of deciding of True up.


13.5.1 The Licensee hereby submits that the Hon’ble Commission approved total sales of

17,793 MU’s. Actual sales during FY 2016-17 was 17565 MU which is lower by 227

MU than approved in the tariff order for FY 2016-17.

13.5.2 The actual revenue as per audited accounts is Rs. 10,368.24 Cr. Details of the same are

as shown in the table below:

Table 39: Revenue from Sales for West Discom FY 2016-17

Particulars As per Tariff Order (A)

Actuals (B)

Variance (B-A)

Sales (MU)

Revenues (Rs. Cr)

Sales (MU)

Revenues (Rs. Cr)

Sales (MU)

Revenues (Rs. Cr)

LOW TENSION 13,835 7,411 13,644.75

6,718.01

190.25

-

LV 1: Domestic 4,458 2,479 3,690.36 767.64

LV 2: Non-Domestic 911 726 962.66 (51.66)


401 221 432.76 (31.76)

LV 4: LT Industry 584 428 561.69 22.31

LV 5: Irrigation pump for Agriculture

7,481 3,557 7,997.28 (516.28)

HIGH TENSION 3,958 2,840 3,920.44 37.56

HV 1: Railway Traction 434 302 - 434.00

HV 2: Coal Mines - - - -

HV-3: Industrial & Non-Industrial 3,095 2,306 3,374.00 (279.50)

HV-4: Seasonal 5 5 11.37 (6.37)

HV-5: HT Irrigation & Water Works

393 209 498.73 (106.23)

HV 6: Bulk Residential Users 31 18 30.85 0.15

HV 7: Start-Up power 1 - 5.49 (4.49)

GRAND TOTAL HT + LT 17,793 10,251 17,565.19 6,718.01 227.81 3,532.99

Subsidy form GOMP 3,724.58

Less Additional Power Purchase Cost of FY 2006-07 borne by GoMP as subsidy in accordance with the order of Hon’ble MPERC dtd. 25.10.2016 in petition no.13/2008, 15/2008& 22/2008

74.33

Net Subsidy 3,650.23

Revenue From Sale Of Power As Per Audited Accounts (Including Subsidy and excluding revenue from sale of services)

10,368.24



T14: SUMMARY OF TRUE UP ARR FOR FY 2016-17

14.1 East Discom submits that in accordance with the normative parameters of MPERC, the

gross ARR of East Discom for the period FY 2016-17 is Rs 9,944.23 Cr, which is Rs

828.32 Cr higher than the approved ARR in the Tariff Order for the period FY 2016-

17.The income from sale of power including the subsidy was Rs. 7,418.77 Cr which is

lesser by Rs 1,586.51 Cr and other income was Rs. 269.96 Cr which is higher by Rs.

17.97 Cr. as assessed in Tariff order 2016-17. Thus the total gap works out as Rs

2,664.07 Cr.

14.2 Central Discom submits that in accordance with the normative parameters of MPERC,

the gross ARR of Central Discom for the period FY 2016-17 is Rs 10,361.21 Cr, which

is Rs 1,446.36 Cr higher than the approved ARR in the Tariff Order for the period FY

2016-17.The income from sale of power including the subsidy was Rs. 8,012.11 Cr

which is lesser by Rs 1,059.82 Cr and other income was Rs. 212.28 Cr which is lesser

by Rs. 0.03 Cr as assessed in Tariff order 2016-17. Thus the total gap works out as Rs

2,817.80 Cr.

14.3 West Discom submits that in accordance with the normative parameters of MPERC,

the gross ARR of West Discom for the period FY 2016-17 is Rs 11,431.42 Cr, which

is Rs 1,683.58 Cr higher than the approved ARR in the Tariff Order for the period FY

2016-17.The income from sale of power including the subsidy was Rs. 10,368.24 Cr

which is higher by Rs 117.54 Cr and other income was Rs. 133.00 Cr which is lesser

by Rs. 73.26 Cr. as assessed in Tariff order 2016-17. Thus the total gap works out as

Rs 1,765.67 Cr.

14.4 Summary of the petitioner’s claim towards true up for the period FY 2016-17 is as

follows:

Table 40: Summary of True Up Claimed for FY 2016-17 (Rs Cr)

Sr. no.



Variation

1 Power Purchase Cost Including MPPMCL Cost

EZ 7,136.16 7,872.38 (736.22)

CZ 6,953.47 8,039.55 (1,086.08)

WZ 8,082.78 9,675.18 (1,592.40)

MP State 22,172.41 25,587.10 (3,414.69)


EZ 920.58 814.28 106.30

CZ 839.91 906.47 (66.56)

WZ 947.89 761.03 186.86

MP State 2,780.37 2,481.77 298.60

3 A&G Cost

EZ 168.50 212.30 (43.80)

CZ 96.50 98.49 (1.99)

WZ 129.50 143.38 (13.88)

MP State 394.50 454.17 (59.67)

4 R&M Cost EZ 158.00 174.16 (16.16)

CZ 177.56 130.51 47.05



Sr. no.



Variation

WZ 122.99 123.48 (0.49)

MP State 458.54 428.15 30.39

5 Depreciation

EZ 134.91 303.80 (168.89)

CZ 161.46 272.54 (111.08)

WZ 106.91 237.30 (130.39)

MP State 403.29 813.63 (410.34)

6 Interest on Project Loans

EZ 225.28 168.96 56.32

CZ 284.20 148.62 135.58

WZ 84.86 75.47 9.39

MP State 594.34 393.05 201.29

7 Interest on Working Capital

EZ 74.92 57.29 17.63

CZ 31.96 121.53 (89.57)

WZ - 25.18 (25.18)

MP State 106.88 204.00 (97.12)

8 Interest on Consumer Security Deposit

EZ 40.32 50.57 (10.25)

CZ 61.87 54.87 7.00

WZ 90.11 62.99 27.12

MP State 192.30 168.43 23.87

9 Return on Equity

EZ 255.26 293.25 (37.99)

CZ 305.92 311.18 (5.26)

WZ 180.81 168.05 12.76

MP State 741.99 772.48 (30.49)


EZ 2.00 100.89 (98.89)

CZ 2.00 277.46 (275.46)

WZ 2.00 158.51 (156.51)

MP State 6.00 536.86 (530.86)

11 Other Expenses

EZ - - -

CZ - - -

WZ - 0.87 (0.87)

MP State - 0.87 (0.87)

12 Less: Expenses Capitalized

EZ - (103.64) 103.64

CZ - - -

WZ - - -

MP State - (103.64) 103.64

13 Total Expenses

EZ 9,115.91 9,944.23 (828.32)

CZ 8,914.85 10,361.21 (1,446.36)

WZ 9,747.84 11,431.42 (1,683.58)

MP State 27,778.61 31,736.87 (3,958.26)


EZ 251.99 269.96 (17.97)

CZ 212.25 212.28 (0.03)

WZ 206.26 133.00 73.26

MP State 670.49 615.24 55.25


EZ 231.93 - 231.93

CZ 279.83 - 279.83

WZ 88.24 - 88.24

MP State 600.00 - 600.00



Sr. no.



Variation


EZ 8,631.99 9,674.27 (1,042.28)

CZ 8,422.77 10,148.93 (1,726.16)

WZ 9,453.35 11,298.43 (1,845.08)

MP State 26,508.11 31,121.63 (4,613.52)


EZ 373.29 408.57 (35.28)

CZ 649.16 680.98 (31.82)

WZ 797.35 835.49 (38.14)

MP State 1,819.80 1,925.04 (105.24)


EZ 9,005.28 10,082.84 (1,077.56)

CZ 9,071.93 10,829.91 (1,757.98)

WZ 10,250.70 12,133.92 (1,883.22)

MP State 28,327.91 33,046.67 (4,718.76)


EZ 9,005.28 7,418.77 1,586.51

CZ 9,071.93 8,012.11 1,059.82

WZ 10,250.70 10,368.24 (117.54)

MP State 28,327.91 25,799.12 2,528.79

20 Revenue Deficit/Surplus

EZ - 2,664.07 (2,664.07)

CZ - 2,817.80 (2,817.80)

WZ - 1,765.67 (1,765.67)

MP State - 7,247.55 (7,247.55)

14.5 The petitioners hereby submit that the total revenue gap works out to be Rs 2,664.07

Cr, Rs 2,817.80 Cr, Rs 1,765.67 Cr and Rs 7,247.55 Cr for East Discom, Central

Discom, West Discom and MP State respectively. This gap may be included in the

ARRs of subsequent years or as the Hon’ble commission may deem fit for recovery of

the same.

14.6 The licensees would like to refer here Clause 5.3 (h) 2) of the National Electricity Policy

dated 6th January 2006 which states that “In cases where operations have been much

below the norms for many previous years the initial starting point in determining the

revenue requirement and the improvement trajectories should be recognized at

“relaxed” levels and not the “desired” levels.” In light of the above para, the licensee

pleads the Hon’ble Commission to consider relaxed norms for the True-up of ARR for

the period FY 2016-17. The Licensee wishes to submit to the Hon’ble Commission that

it had been acting as an agent of Madhya Pradesh State Electricity Board (MPSEB) till

31st May 2005 and it has been over 9 years since the licensee has been operating

independently. Taking this into consideration the licensee pleads to the Hon’ble

Commission to allow it to operate at levels that can be feasible for the operation of the

Discom.

Documents

FOR FY 2016-17