FOR FY 2017-18 Petition for FY-2017-18 filed by MPPMCL - Sta… · the 'Petitioner', MPPKVVCL, 'the Company' or 'the Licensee' or ‘East Discom’), is a Company incorporated under

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 2017-18

True-up Petition of MP Discoms for FY 2017-18

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:

Filling up of application for True up of the ARR for FY 2017-18 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 NishthaParisar, 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 2017-18 dated 31st

March 2017 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

2017-18.

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 17thDecember 2015” for truing up of the ARR for the Distribution and

Retail Supply Business for the period FY 2017-18.

12. Based on the information available, the Petitioners have 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 have estimated net ARR of Rs. 9,708.06 Crores for East Discom, Rs.

10,344.57 Crores for Central Discom & Rs. 11,648.26 Crores for West Discom

aggregating to a total ARR of Rs. 31,700.89 Crores for MP State. The Revenue deficit

after considering the impact of True-up’s is Rs. 2,215.58 Crores for East Discom, Rs

2,613.58 Crores for Central Discom, Rs. 498.38 Crores for West Discom aggregating to

a total revenue deficit of Rs.5,327.54 Crores for MP State. 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 6,937.73 8,001.86 (1,064.13)

CZ 7648.31 8,570.05 (921.74)

WZ 9,262.40 9,970.19 (707.79)

MP State 23,848.44 26,542.10 (2,693.66)

2 Employee Cost (including

terminal benefit cash outflow)

EZ 1,037.28 822.48 214.80

CZ 997.17 1,127.85 (130.68)

WZ 1,067.45 731.24 336.21

MP State 3,101.90 2,681.57 420.33

3 A&G Cost

EZ 179.50 218.90 (39.40)

CZ 103.50 133.55 (30.05)

WZ 138.50 152.73 (14.23)

MP State 421.50 505.18 (83.68)

4 R&M Cost

EZ 151.40 168.84 (17.44)

CZ 183.94 145.58 38.36

WZ 135.14 136.32 (1.18)

MP State 470.49 450.74 19.75

5 Depreciation

EZ 116.50 335.28 (218.78)

CZ 159.54 300.71 (141.17)

WZ 105.05 244.33 (139.28)

MP State 381.09 880.33 (499.24)

6 Interest on Project Loans

EZ 106.69 150.08 (43.39)

CZ 238.10 6.37 231.73

WZ 67.53 44.51 23.02

MP State 412.32 200.96 211.36

7 Interest on Working Capital

EZ 85.97 72.61 13.36

CZ 46.38 35.69 10.69

WZ 63.99 37.73 26.26

MP State 196.34 146.03 50.31

8 Interest on Consumer Security

Deposit

EZ 31.69 55.79 (24.10)

CZ 56.16 52.89 3.27

WZ 54.50 63.59 (9.09)

MP State 142.34 172.27 (29.93)

9 Return on Equity EZ 219.05 307.16 (88.11)

CZ 302.14 318.61 (16.47)



Sr.

no.


Tariff

Order

Claimed in

True up

Petition

Variation

WZ 177.63 174.41 3.22

MP State 698.82 800.17 (101.35)

10 Bad and Doubtful Debts

EZ 2.00 14.75 (12.75)

CZ 2.00 23.28 (21.28)

WZ 2.00 237.00 (235.00)

MP State 6.00 275.03 (269.03)

11 Other Expenses

EZ

-

CZ

- -

WZ

0.52 (0.52)

MP State

0.52 (0.52)

12 Less: Expenses Capitalized

EZ

(122.92) 122.92

CZ

(27.75) 27.75

WZ

-

MP State

(150.67) 150.67

13 Total Expenses

EZ 8,867.82 10,024.83 (1,157.01)

CZ 9,737.25 10,686.83 (949.58)

WZ 11,074.19 11,792.57 (718.38)

MP State 29,679.25 32,504.23 (2,824.98)

14 Less: Other Income - Retail &

Wheeling

EZ 243.40 316.77 (73.37)

CZ 268.57 342.26 (73.69)

WZ 349.37 144.32 205.05

MP State 861.34 803.35 57.99

16 Net Total Expenses for FY 2017-

18

EZ 8,624.42 9,708.06 (1,083.64)

CZ 9,468.68 10,344.57 (875.89)

WZ 10,724.82 11,648.26 (923.44)

MP State 28,817.91 31,700.89 (2,882.98)

17 Add: Impact of True-Ups

EZ 795.03 840.40 (45.37)

CZ 810.09 864.09 (54.00)

WZ 638.98 687.98 (49.00)

MP State 2,244.10 2,392.47 (148.37)

18 Total ARR for FY 2017-18

EZ 9,419.45 10,548.46 (1,129.01)

CZ 10,278.76 11,208.66 (929.90)

WZ 11,363.80 12,336.24 (972.44)

MP State 31,062.01 34,093.36 (3,031.35)

19 Revenue from sale of Power EZ 9,419.45 8,332.88 1,086.57



Sr.

no.


Tariff

Order

Claimed in

True up

Petition

Variation

CZ 10,278.76 8,595.08 1,683.68

WZ 11,363.80 11,837.85 (474.05)

MP State 31,062.01 28,765.81 2,296.20

20 Revenue Deficit/(Surplus)

EZ - 2,215.58 (2,215.58)

CZ - 2,613.58 (2,613.58)

WZ - 498.38 (498.38)

MP State - 5,327.54 (5,327.54)

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 2017-18 of East Discom,

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

b) Consider and approve True-up amount of Rs. 2,215.58 Crores for East Discom, Rs

2,613.58 Crores for Central Discom and Rs. 498.38 Crores for West Discom

aggregating to Rs. 5,327.54 Crores for MP state which shall be incorporated in ARR

for FY 2020-21 on 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 any delay caused 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: 15th October’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 FY2017-18 ....... 10

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

T3: ENERGY SALES ........................................................................................ 31

T4: OPERATION & MAINTENANCE COST..................................................... 45

T5: INTEREST & FINANCE CHARGES ........................................................... 47

T6: DEPRECIATION AND RELATED DEBITS ................................................ 53

T7: BAD AND DOUBTFUL DEBTS ................................................................... 55

T8: OTHER EXPENSES .................................................................................... 56

T9: RETURN ON EQUITY ................................................................................ 57

T10: TAXES ....................................................................................................... 59

T11: OTHER EXPENSES CAPITALISED ........................................................... 59

T12: OTHER INCOME ....................................................................................... 60

T13: INCOME FROM SALE OF POWER ........................................................... 62

T14: SUMMARY OF TRUE UP ARR FOR FY 2017-18 ........................................ 65



LIST OF TABLES

Table 1: Comparison of ARR claimed and Allowed for FY 2017-18 ......................................................... 10

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

Table 3: Details of power purchase quantum and cost – Allowed and As per Audited Accounts ............... 28

Table 4: Number of Consumer for the FY 2017-18 ..................................................................................... 31

Table 5: Connected Load for the FY 2017-18 (kW) .................................................................................... 31

Table 6: Sale for FY 2017-18 (MUs) ........................................................................................................... 32

Table 7: Month & Category wise Sale for FY 2017-18 (MUs) ................................................................... 33

Table 8: Assumptions ................................................................................................................................... 37

Table 9: Calculation of disallowed units as per existing methodology ........................................................ 37

Table 10: Calculation of Energy Balance as per Existing methodology of MPERC ................................... 37

Table 11: Calculation of Power Purchase Cost as per Existing Methodology of MPERC .......................... 38

Table 12: Calculation of Energy Balance considering UI Sale .................................................................... 39

Table 13: Calculation of disallowed units as per proposed methodology .................................................... 39

Table 14: Calculation of cost of disallowed power purchase units as per proposed methodology .............. 41

Table 15: Details of power purchase cost to be allowed for East Discom FY 2017-18 (Rs Cr) .................. 42

Table 16: Details of power purchase cost to be allowed for Central Discom FY 2017-18 (Rs Cr) ............. 42

Table 17: Details of power purchase cost to be allowed for West Discom FY 2017-18 (Rs Cr) ................. 43

Table 18: Comparison of Costs – Commission’s Methodology Vs Petitioner’s Methodology (Rs Cr.) ..... 44

Table 19: Details of O&M cost claimed towards true up of FY 2017-18 .................................................... 45

Table 20: Details of Finance Charges Claimed by East Discom for True-up FY 2017-18 (Rs Cr) ............ 47

Table 21: Details of Finance Charges Claimed by Central Discom for True-up FY 2017-18 (Rs Cr) ........ 48

Table 22: Details of Finance Charges claimed by West Discom for True-up of FY 2017-18 ..................... 48

Table 23: Details of Interest on Working Capital Claimed by East Discom in True up of FY 2017-18 ..... 49

Table 24: Details of Interest on Working Capital Claimed by West Discom in True up of FY 2017-18 .... 51

Table 25: Details of Interest on Consumer Security Deposit claimed for the year FY 2017-18 .................. 52

Table 26: Summary of Interest and Finance Charges claimed towards True up of FY 2017-18 ................. 52

Table 27: Details of Depreciation Claimed by petitioners for FY 2017-18 ................................................. 53

Table 28: Details of Bad and Doubtful debts Claimed by petitioners for FY 2017-18 ................................ 55

Table 29: Other Expenses Claimed as true up for FY 2017-18 ................................................................... 56

Table 30: ROE Claimed by EZ as true up for FY 2017-18 .......................................................................... 57

Table 31: ROE Claimed by CZ as true up for FY 2017-18.......................................................................... 57

Table 32: ROE Claimed by WZ as true up for FY 2017-18 ........................................................................ 58

Table 33: ROE Claimed by Petitioners for FY 2017-18 .............................................................................. 59

Table 34: Other expenses capitalized claimed by East Discom for FY 2017-18 ......................................... 59

Table 35: Other expenses capitalized claimed by West Discom for FY 2017-18 ........................................ 60

Table 36: Other expenses capitalized claimed by West Discom for FY 2017-18 ........................................ 60

Table 37: Other income claimed by Petitioners for FY 2017-18 ................................................................. 61

Table 38: Revenue from Sales for East Discom FY 2017-18 ...................................................................... 62

Table 39: Revenue from Sales for Central Discom FY 2017-18 ................................................................. 63

Table 40: Revenue from Sales for West Discom FY 2017-18 ..................................................................... 64

Table 41: Summary of True Up Claimed for FY 2017-18 (Rs Cr) .............................................................. 65



T1: COMPARISON OF CLAIMED AND ALLOWED ARR FOR FY2017-18

1.1 East Discom, Central Discom and West Discom in their Tariff petition no. 71/2016,

dated 8th December 2016 had submitted the claim for ARR of Rs. 9950 Crs, Rs. 10586

Crs and Rs. 11,537 Crs respectively. Hon’ble Commission in its Tariff Order dated

31st March 2017 had allowed the ARR of Rs 9419.45 Crs, Rs. 10,278.76 Crs and Rs

11,363.80 Crs 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 2017-18

Sr.

no.

Particulars Discom Claimed in

ARR Petition

Approved Disallowance

1 Power Purchase Cost

Including MPPMCL Cost

EZ 7,750 6,938 812

CZ 8,176 7,648 528

WZ 9,364 9,262 102

MP State 25,290 23,848 1,442

2

Employee Cost (including

terminal benefit cash

outflow)

EZ 998 1,037 (39)

CZ 1,012 997 15

WZ 1,029 1,067 (38)

MP State 3,039 3,102 (63)

3 A&G Cost

EZ 184 180 5

CZ 105 104 2

WZ 153 139 15

MP State 442 422 21

4 R&M Cost

EZ 166 151 15

CZ 184 184 0

WZ 140 135 5

MP State 490 470 20

5 Depreciation

EZ 324 117 208

CZ 349 160 189

WZ 254 105 149

MP State 927 381 546


EZ 191 107 84

CZ 329 238 91

WZ 159 68 91

MP State 679 412 267


EZ 57 86 (29)

CZ 36 46 (11)

WZ 51 64 (13)

MP State 144 196 (53)

8 Interest on Consumer

Security Deposit

EZ 36 32 4

CZ 64 56 8

WZ 63 55 9

MP State 142 142 -

9 Return on Equity EZ 264 219 45

CZ 301 302 (1)



Sr.

no.

Particulars Discom Claimed in

ARR Petition

Approved Disallowance

WZ 256 178 78

MP State 821 699 122


EZ 84 2 82

CZ 99 2 97

WZ 101 2 99

MP State 284 6 278

11 Other Expenses

EZ

-

CZ

-

WZ

-

MP State

-

12 Less: Expenses Capitalised

EZ

-

CZ

-

WZ

-

MP State

-

13 Total Expenses

EZ 10,054 8,868 1,186

CZ 10,655 11,074 (420)

WZ 11,570 9,737 1,833

MP State

29,679 (29,679)

14 Less: Other Income - Retail

& Wheeling

EZ 177 243 (66)

CZ 150 349 (199)

WZ 151 269 (118)

MP State 478 861 (383)

15 Net Total Expenses for FY

2016-17

EZ 9,877 8,624 1,253

CZ 10,505 10,725 (220)

WZ 11,419 9,469 1,950

MP State

28,818 (28,818)


EZ 74 795 (721)

CZ 82 639 (557)

WZ 119 810 (691)

MP State 275 2,244 (1,969)


EZ 9,951 9,419 531

CZ 10,587 11,364 (777)

WZ 11,538 10,279 1,259

MP State

31,062 (31,062)

18 Revenue from sale of Power

EZ 8,376 9,419 (1,043)

CZ 9,114 11,364 (2,250)

WZ 10,054 10,279 (225)

MP State 27,544 31,062 (3,518)

19 Revenue Deficit/Surplus

EZ 1,574 - 1,574

CZ 1,472 - 1,472

WZ 1,483 - 1,483

MP State 4,529 - 4,529

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

for FY 2017-18 as per the following table:



Table 2: Details of True Up allowed

1.3 Out of the total impact of Rs. 2244.10 Cr for the State as a whole, impact to the tune

of Rs. 795.03 Crs, Rs 810.09 Crs and Rs 638.98 Crs was allowed in the ARR of East

Discom, Central Discom and West Discom respectively for FY 2017-18.

1.4 On finalisation of the Audited Accounts of the petitioners for the period FY 2017-18,

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 2006-07 423.00

2 Impact of True-Up of MP Transco for FY 2014-15 413.63

3 Impact of True-Up of MP Genco for FY 2014-15 (562)

4 Impact of True-Up of MP Genco for FY 2007-08 to FY 2011-12 1969.47

Total Power Purchase Cost 2244.10



T2: POWER PURCHASE COST

2.1 The Petitioners purchase 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

31st March 2017 had determined the Energy requirement of 19,434 MUs for East

Discom, 20,627 MUs for Central Discom, 23,022 MUs for West Discom aggregating

to 63,083 MUs for the MP State for FY 2017-18 at a cost of Rs. 6,937.73 Cr for the

East Discom, Rs. 7,648.31 Cr for the Central Discom and Rs. 9,262.39 Cr for the

West Discom thus aggregating to Rs. 23,848.44 Cr for the MP State for FY 2017-18

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.8,374.22 Cr

for the East Discom, Rs.9,404.47 Cr for the Central Discom and Rs.10,019.20 Cr for

the West Discom aggregating to Rs. 27,797.89 Cr for the MP State for FY 2017-18 as

shown in the Table below:



S.No Source of Power Purchase Allocation

Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

I Purchase from Power Stations

1 KSTPS

3,575.00 233.10 453.47 - - 27.87 - 0.37 714.82

EZ 0.39 1,394.25 90.91 176.86 - - 10.87 - 0.15 278.78

CZ 0.28 1,001.00 65.27 126.97 - - 7.80 - 0.10 200.15

WZ 0.33 1,179.75 76.92 149.65 - - 9.20 - 0.12 235.89

2 KSTPS III

569.43 77.87 70.87 - - 4.48 - 0.06 153.28

EZ 0.29 162.80 22.27 20.32 - - 1.27 - 0.02 43.88

CZ 0.36 205.44 28.32 25.58 - - 1.63 - 0.02 55.55

WZ 0.35 201.19 27.28 24.97 - - 1.58 - 0.02 53.85

3 VSTPS - I

3,004.81 247.43 443.20 - - 56.42 - 0.44 747.49

EZ 0.36 1,081.73 89.08 159.55 - - 20.31 - 0.16 269.10

CZ 0.34 1,021.64 84.13 150.69 - - 19.18 - 0.15 254.15

WZ 0.30 901.44 74.23 132.96 - - 16.93 - 0.13 224.25

4 VSTPS-II

2,448.73 154.25 329.93 - - 44.45 - 0.22 528.85

EZ 0.36 881.54 55.53 118.77 - - 16.00 - 0.08 190.39

CZ 0.32 783.59 49.36 105.58 - - 14.22 - 0.07 169.23

WZ 0.32 783.59 49.36 105.58 - - 14.22 - 0.07 169.23

5 VSTPS-III

1,973.16 189.54 265.38 - - 33.31 - 0.17 488.40

EZ 0.33 651.14 62.55 87.57 - - 10.99 - 0.06 161.17

CZ 0.31 611.68 58.76 82.27 - - 10.33 - 0.05 151.40

WZ 0.36 710.34 68.23 95.54 - - 11.99 - 0.06 175.82

6 VSTPS-IV

2,235.40 319.70 300.79 - - 40.32 - 0.20 661.00

EZ 0.28 628.34 90.81 85.04 - - 11.31 - 0.06 187.23

CZ 0.36 810.10 116.74 109.55 - - 14.92 - 0.07 241.29

WZ 0.36 796.96 112.15 106.19 - - 14.08 - 0.07 232.49




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

7 VSTPS-V

1,121.07 164.07 153.73 - - 20.59 - 0.10 338.48

EZ 0.28 315.95 46.32 43.59 - - 5.80 - 0.03 95.74

CZ 0.36 408.74 59.94 56.30 - - 7.66 - 0.03 123.92

WZ 0.35 396.38 57.82 53.84 - - 7.13 - 0.03 118.82

8 Kawas

519.31 87.13 125.04 - - - 0.05 0.15 212.36

EZ 0.35 181.76 30.49 43.76 - - - 0.02 0.05 74.33

CZ 0.25 129.83 21.78 31.26 - - - 0.01 0.04 53.09

WZ 0.40 207.72 34.85 50.01 - - - 0.02 0.06 84.95

9 Gandhar

512.66 90.85 128.48 - - - 0.07 1.70 221.10

EZ 0.32 164.05 29.07 41.11 - - - 0.02 0.55 70.75

CZ 0.30 153.80 27.25 38.54 - - - 0.02 0.51 66.33

WZ 0.38 194.81 34.52 48.82 - - - 0.03 0.65 84.02

10 SIPAT I

2,648.76 319.95 302.95 - - 16.97 - 0.24 640.11

EZ 0.29 756.01 91.22 87.21 - - 4.85 - 0.07 183.34

CZ 0.37 968.59 117.24 110.82 - - 6.34 - 0.08 234.47

WZ 0.35 924.16 111.50 104.92 - - 5.79 - 0.08 222.29

11 SIPAT II

1,456.72 170.53 177.48 - - 10.85 - 0.51 359.37

EZ 0.39 568.12 66.51 69.22 - - 4.23 - 0.20 140.15

CZ 0.26 378.75 44.34 46.14 - - 2.82 - 0.13 93.44

WZ 0.35 509.85 59.69 62.12 - - 3.80 - 0.18 125.78

12 TARAPUR

1,092.84 - 332.53 - - (0.01) - 0.98 333.50

EZ 0.34 371.57 - 113.06 - - (0.00) - 0.33 113.39

CZ 0.31 338.78 - 103.08 - - (0.00) - 0.30 103.38

WZ 0.35 382.49 - 116.38 - - (0.00) - 0.34 116.72

13 Kahalgaon II

333.05 57.29 76.05 - - 0.00 - 0.08 133.42




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

EZ 0.27 89.92 15.47 20.53 - - 0.00 - 0.02 36.02

CZ 0.20 66.61 11.46 15.21 - - 0.00 - 0.02 26.68

WZ 0.53 176.52 30.36 40.31 - - 0.00 - 0.04 70.71

14 Mauda-I

525.47 204.47 131.54 - - - - 13.52 349.53

EZ 0.28 147.52 59.58 37.18 - - - - 3.59 100.35

CZ 0.36 191.62 75.64 48.14 - - - - 4.62 128.40

WZ 0.35 186.33 69.25 46.23 - - - - 5.31 120.78

15 Mauda-II

427.17 93.91 100.30 - - - - 1.03 195.24

EZ 0.27 113.79 26.26 26.92 - - - - 0.27 53.45

CZ 0.36 152.88 34.12 35.95 - - - - 0.35 70.42

WZ 0.38 160.50 33.53 37.43 - - - - 0.41 71.37

16 Solapur I

236.13 75.09 57.54 - - - - 13.38 146.01

EZ 0.26 61.97 20.16 14.53 - - - - 3.99 38.68

CZ 0.35 82.43 25.80 20.62 - - - - 4.17 50.60

WZ 0.39 91.73 29.12 22.38 - - - - 5.23 56.73

Total (I)

22,679.69 2,485.18 3,449.25 - - 255.24 0.12 33.16 6,222.95

EZ

7,570.45 796.23 1,145.23 - - 85.63 0.04 9.62 2,036.74

CZ

7,305.47 820.13 1,106.70 - - 84.91 0.03 10.73 2,022.50

WZ

7,803.77 868.83 1,197.32 - - 84.70 0.05 12.81 2,163.70

II Purchase from Other Sources

1 NHDC-Indira Sagar

836.69 492.09 - - - 13.35 - - 505.44

EZ 0.22 184.07 108.26 0.00 - - 2.94 - - 111.20

CZ 0.25 209.17 123.02 (0.00) - - 3.34 - - 126.36

WZ 0.53 443.45 260.81 (0.00) - - 7.08 - - 267.88

2 SSP

519.51 162.75 42.60 - - - - - 205.35




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

EZ 0.32 166.24 52.08 13.63 - - - - - 65.71

CZ 0.25 129.88 40.69 10.65 - - - - - 51.34

WZ 0.43 223.39 69.98 18.32 - - - - - 88.30

3 OMKARESHWAR

441.93 349.08 0.00 - - 6.72 - - 355.80

EZ 0.30 132.58 104.73 (0.00) - - 2.01 - - 106.74

CZ 0.25 110.48 87.27 0.00 - - 1.68 - - 88.95

WZ 0.45 198.87 157.09 0.00 - - 3.02 - - 160.11

4 ISP NVDA

0.02 - 0.01 - - - - - 0.01

EZ 0.22 0.01 - 0.00 - - - - - 0.00

CZ 0.25 0.01 - 0.00 - - - - - 0.00

WZ 0.53 0.01 - 0.01 - - - - - 0.01

5 Wind Energy

3,676.52 - 2,045.47 - - - - - 2,045.47

EZ 0.30 1,090.09 - 606.48 - - - - - 606.48

CZ 0.33 1,220.97 - 679.30 - - - - - 679.30

WZ 0.37 1,365.46 - 759.69 - - - - - 759.69

6 DVC (Mejia)

528.60 140.06 125.41 - - - - 0.62 266.09

EZ 0.33 174.44 46.22 41.39 - - - - 0.20 87.81

CZ 0.14 74.00 19.61 17.56 - - - - 0.09 37.25

WZ 0.53 280.16 74.23 66.47 - - - - 0.33 141.03

7 DVC (Chandrpur)

1,115.35 197.29 204.45 - - - - 2.82 404.57

EZ 0.33 368.07 65.11 67.47 - - - - 0.93 133.51

CZ 0.14 156.15 27.62 28.62 - - - - 0.40 56.64

WZ 0.53 591.14 104.56 108.36 - - - - 1.50 214.42

8 DVC (Durgapur)

64.35 15.97 13.16 - - - - 0.01 29.14

EZ 0.32 20.64 5.14 4.22 - - - - 0.00 9.36




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

CZ 0.34 22.07 5.47 4.52 - - - - 0.00 9.99

WZ 0.34 21.64 5.37 4.43 - - - - 0.00 9.80

9 Torrent

44.40 66.59 17.56 - - 0.11 - 0.24 84.51

EZ 0.26 11.45 18.35 4.45 - - 0.03 - 0.06 22.89

CZ 0.37 16.62 23.60 6.52 - - 0.04 - 0.09 30.26

WZ 0.37 16.33 24.64 6.58 - - 0.04 - 0.09 31.36

10 Sasan

11,235.39 166.42 1,291.62 - - 198.41 - 178.57 1,835.03

EZ 0.28 3,182.93 47.25 365.91 - - 56.20 - 52.25 521.62

CZ 0.36 4,088.14 60.73 469.97 - - 72.20 - 64.88 667.78

WZ 0.35 3,964.32 58.44 455.74 - - 70.01 - 61.44 645.63

11 RDM Care

2.20 - 0.67 - - - - - 0.67

EZ 0.30 0.65 - 0.20 - - - - - 0.20

CZ 0.33 0.73 - 0.22 - - - - - 0.22

WZ 0.37 0.82 - 0.25 - - - - - 0.25

12 JP Bina

1,263.71 426.92 299.71 - - 19.67 - (0.34) 745.96

EZ 0.28 348.51 121.05 81.94 - - 5.58 - (0.11) 208.45

CZ 0.35 442.11 155.30 106.81 - - 7.34 - (0.13) 269.32

WZ 0.37 473.10 150.58 110.96 - - 6.75 - (0.10) 268.19

13 BLA

- - - - - - - - -

EZ - - - - - - - - - -

CZ - - - - - - - - - -

WZ - - - - - - - - - -

14 MB Power Unit - I

932.78 237.28 184.96 - - 14.98 - 0.86 438.08

EZ 0.29 266.48 67.79 52.80 - - 3.82 - 0.24 124.65

CZ 0.36 337.29 86.46 66.75 - - 5.43 - 0.31 158.95




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

WZ 0.35 329.01 83.03 65.41 - - 5.73 - 0.31 154.48

15 MB Power Unit - II

926.10 162.77 185.75 - - 15.26 - - 363.78

EZ 0.28 257.16 45.31 51.51 - - 3.92 - - 100.74

CZ 0.37 342.29 60.35 68.50 - - 5.51 - - 134.36

WZ 0.35 326.64 57.12 65.74 - - 5.83 - - 128.69

16 Hindalco

- - - - - - - - -

EZ #DIV/0! - - - - - - - - -

CZ #DIV/0! - - - - - - - - -

WZ #DIV/0! - - - - - - - - -

17 LancoAmarkantak

1,773.51 239.05 293.33 - - 13.09 - 8.49 553.95

EZ 0.28 500.13 69.83 82.02 - - 3.70 - 2.41 157.96

CZ 0.36 634.36 87.47 104.40 - - 4.73 - 3.04 199.63

WZ 0.36 639.02 81.75 106.91 - - 4.66 - 3.05 196.36

18 Arya

- - - - - - - - -

EZ #DIV/0! - - - - - - - - -

CZ #DIV/0! - - - - - - - - -

WZ #DIV/0! - - - - - - - - -

19 M/s Orient Green

- - - - - - - - -

EZ #DIV/0! - - - - - - - - -

CZ #DIV/0! - - - - - - - - -

WZ #DIV/0! - - - - - - - - -

20 JP Nigrie

3,324.62 612.72 160.99 - - 59.34 - 0.00 833.05

EZ 0.28 946.09 174.21 46.37 - - 17.08 - 0.00 237.66

CZ 0.36 1,204.46 222.85 57.98 - - 21.63 - 0.00 302.47

WZ 0.35 1,174.06 215.65 56.63 - - 20.63 - 0.00 292.92




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

21 Jhabua Power

440.39 143.57 98.32 - - 5.59 - - 247.48

EZ 0.27 116.95 39.50 26.10 - - 1.42 - - 67.02

CZ 0.36 157.50 50.88 35.01 - - 1.98 - - 87.87

WZ 0.38 165.94 53.19 37.21 - - 2.19 - - 92.59

22 Jabalpur MSW

47.89 - 25.87 - - - - - 25.87

EZ 0.30 14.20 - 7.67 - - - - - 7.67

CZ 0.33 15.90 - 8.59 - - - - - 8.59

WZ 0.37 17.78 - 9.61 - - - - - 9.61

23 Solar Energy

1,277.07 - 786.64 - - - - - 786.64

EZ 0.30 378.65 - 233.24 - - - - - 233.24

CZ 0.33 424.11 - 261.24 - - - - - 261.24

WZ 0.37 474.30 - 292.16 - - - - - 292.16

24 IEX/PXI

554.82 - 216.02 - - - - - 216.02

EZ 0.30 165.83 - 64.57 - - - - - 64.57

CZ 0.32 176.60 - 68.76 - - - - - 68.76

WZ 0.38 212.38 - 82.69 - - - - - 82.69

25 Essar Power (5%)

73.53 - 17.29 - - 1.77 - 2.28 21.33

EZ 0.30 21.91 - 5.13 - - 0.53 - 0.68 6.33

CZ 0.35 25.42 - 5.96 - - 0.61 - 0.79 7.36

WZ 0.36 26.19 - 6.20 - - 0.63 - 0.81 7.64

Others-Total (II)

29,079.36 3,412.57 6,009.82 - - 348.29 - 193.56 9,964.24

EZ

8,347.08 964.82 1,755.08 - - 97.23 - 56.67 2,873.81

CZ

9,788.28 1,051.32 2,001.37 - - 124.48 - 69.46 3,246.64

WZ

10,944.00 1,396.43 2,253.36 - - 126.58 - 67.43 3,843.80

A Grand Total other than Genco(I+II)

51,759.05 5,897.75 9,459.06 - - 603.53 0.12 226.72 16,187.19




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

EZ

15,917.53 1,761.04 2,900.31 - - 182.86 0.04 66.29 4,910.55

CZ

17,093.74 1,871.45 3,108.07 - - 209.39 0.03 80.19 5,269.14

WZ

18,747.77 2,265.26 3,450.68 - - 211.28 0.05 80.24 6,007.50

I MP Genco - Thermal

1 ATPS-Chachai (210MW)

1,572.36 221.67 259.94 - - 3.11 - 1.18 485.91

EZ 0.27 424.54 59.85 70.18 - - 0.84 - 0.32 131.20

CZ 0.40 628.95 88.67 103.98 - - 1.25 - 0.47 194.36

WZ 0.33 518.88 73.15 85.78 - - 1.03 - 0.39 160.35

2 STPS Sarni

1,517.98 298.46 379.65 - - 3.64 - 2.00 683.74

EZ 0.29 440.21 86.23 110.10 - - 1.05 - 0.58 197.96

CZ 0.39 592.01 116.72 148.06 - - 1.42 - 0.78 266.99

WZ 0.32 485.75 95.51 121.49 - - 1.16 - 0.64 218.80

3 SGTPS Birsingpur

4,041.57 355.73 866.33 - - 7.08 - 1.33 1,230.46

EZ 0.28 1,131.64 99.60 242.57 - - 1.98 - 0.37 344.53

CZ 0.40 1,616.63 142.29 346.53 - - 2.83 - 0.53 492.19

WZ 0.32 1,293.30 113.83 277.22 - - 2.26 - 0.43 393.75

4 SGTPS Birsingpur (500MW)

2,860.99 350.13 577.11 - - 4.21 - 0.79 932.25

EZ 0.28 801.08 98.04 161.59 - - 1.18 - 0.22 261.04

CZ 0.40 1,144.40 140.05 230.84 - - 1.68 - 0.32 372.89

WZ 0.32 915.52 112.04 184.68 - - 1.35 - 0.25 298.32

5 STPS Sarni # 10 & 11

3,009.11 654.74 590.88 - - 2.19 - 1.20 1,249.01

EZ 0.28 849.48 184.88 167.01 - - 0.62 - 0.34 352.84

CZ 0.36 1,078.71 235.99 211.32 - - 0.80 - 0.44 448.55

WZ 0.36 1,080.92 233.87 212.55 - - 0.77 - 0.42 447.62

6 SSTPS SingajiKhandwa 1 & 2

3,578.68 998.74 872.16 - - 17.82 - 0.61 1,889.34




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

EZ 0.28 997.11 286.82 242.47 - - 5.06 - 0.17 534.52

CZ 0.36 1,288.06 359.23 312.62 - - 6.46 - 0.22 678.53

WZ 0.36 1,293.50 352.69 317.07 - - 6.30 - 0.22 676.28

M.P. Genco Thermal-Total (I)

16,580.69 2,879.47 3,546.08 - - 38.05 - 7.13 6,470.72

EZ

4,644.06 815.42 993.92 - - 10.74 - 2.01 1,822.09

CZ

6,348.75 1,082.95 1,353.36 - - 14.44 - 2.77 2,453.52

WZ

5,587.88 981.10 1,198.79 - - 12.87 - 2.35 2,195.11

II MPGenco - Hydel

1 Gandhi Sagar

173.84 3.40 2.92 - - 7.24 - 0.03 13.60

EZ 0.23 39.98 0.78 0.67 - - 1.67 - 0.01 3.13

CZ 0.50 86.92 1.70 1.46 - - 3.62 - 0.02 6.80

WZ 0.27 46.94 0.92 0.79 - - 1.96 - 0.01 3.67

2 R P Sagar

187.12 - 28.25 - - - - - 28.25

EZ 0.20 37.42 - 5.65 - - - - - 5.65

CZ 0.50 93.56 - 14.13 - - - - - 14.13

WZ 0.30 56.14 - 8.48 - - - - - 8.48

3 JawaharSagar

129.00 - 19.48 - - - - - 19.48

EZ 0.20 25.80 - 3.90 - - - - - 3.90

CZ 0.50 64.50 - 9.74 - - - - - 9.74

WZ 0.30 38.70 - 5.84 - - - - - 5.84

4 Pench

101.10 9.31 4.51 - - - - 0.05 13.87

EZ 0.20 20.22 1.86 0.90 - - - - 0.01 2.77

CZ 0.40 40.44 3.73 1.80 - - - - 0.02 5.55

WZ 0.40 40.44 3.73 1.80 - - - - 0.02 5.55

5 Ban Sagar (I+II+III)

659.75 70.99 40.34 - - 13.97 - 0.12 125.42




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

EZ 0.30 197.93 21.30 12.10 - - 4.19 - 0.04 37.63

CZ 0.30 197.93 21.30 12.10 - - 4.19 - 0.04 37.63

WZ 0.40 263.90 28.40 16.13 - - 5.59 - 0.05 50.17

6 Jhinna HPS

66.47 8.63 6.39 - - 0.98 - 0.01 16.00

EZ 0.30 19.94 2.59 1.92 - - 0.29 - 0.00 4.80

CZ 0.30 19.94 2.59 1.92 - - 0.29 - 0.00 4.80

WZ 0.40 26.59 3.45 2.56 - - 0.39 - 0.00 6.40

7 Brinsingpur Hydro

24.47 1.87 4.60 - - 0.63 - 0.01 7.11

EZ 0.30 7.34 0.56 1.38 - - 0.19 - 0.00 2.13

CZ 0.20 4.89 0.37 0.92 - - 0.13 - 0.00 1.42

WZ 0.50 12.23 0.94 2.30 - - 0.31 - 0.00 3.56

8 Bargi

129.00 8.14 2.01 - - 12.85 - 0.03 23.03

EZ 0.25 32.25 2.04 0.50 - - 3.21 - 0.01 5.76

CZ 0.25 32.25 2.04 0.50 - - 3.21 - 0.01 5.76

WZ 0.50 64.50 4.07 1.01 - - 6.42 - 0.01 11.51

9 Rajghat

28.59 1.94 3.37 - - - - 0.01 5.31

EZ 0.20 5.72 0.39 0.67 - - - - 0.00 1.06

CZ 0.40 11.44 0.77 1.35 - - - - 0.01 2.13

WZ 0.40 11.44 0.77 1.35 - - - - 0.01 2.13

10 Madhikheda HPS

21.74 14.87 4.53 - - 2.54 - 0.02 21.96

EZ 0.30 6.52 4.46 1.36 - - 0.76 - 0.01 6.59

CZ 0.20 4.35 2.97 0.91 - - 0.51 - 0.00 4.39

WZ 0.50 10.87 7.44 2.27 - - 1.27 - 0.01 10.98

M.P. GencoHydel Total (II)

1,521.08 119.16 116.40 - - 38.21 - 0.27 274.04

EZ

393.12 33.98 29.05 - - 10.31 - 0.07 73.42




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

CZ

556.21 35.47 44.82 - - 11.95 - 0.09 92.34

WZ

571.74 49.71 42.52 - - 15.94 - 0.11 108.29

B MP Genco TOTAL (I+II)

18,101.77 2,998.63 3,662.48 - - 76.26 - 7.40 6,744.77

EZ

5,037.18 849.40 1,022.97 - - 21.05 - 2.08 1,895.50

CZ

6,904.97 1,118.42 1,398.19 - - 26.40 - 2.86 2,545.86

WZ

6,159.62 1,030.81 1,241.32 - - 28.82 - 2.46 2,303.40

C Total Power Purchased (A+B)

69,860.82 8,896.38 13,121.54 - - 679.79 0.12 234.13 22,931.96

EZ

20,954.71 2,610.44 3,923.29 - - 203.91 0.04 68.37 6,806.05

CZ

23,998.71 2,989.87 4,506.26 - - 235.79 0.03 83.05 7,815.00

WZ

24,907.39 3,296.07 4,691.99 - - 240.09 0.05 82.70 8,310.90

D Total Inter-State transmission

charges

1 PGCIL

- 1,463.70 - - - - - - 1,463.70

EZ 0.30 - 438.34 - - - - - - 438.34

CZ 0.34 - 503.38 - - - - - - 503.38

WZ 0.36 - 521.98 - - - - - - 521.98

2 POSCO

- 4.86 - - - - - - 4.86

EZ 0.30 - 1.46 - - - - - - 1.46

CZ 0.34 - 1.68 - - - - - - 1.68

WZ 0.35 - 1.72 - - - - - - 1.72

3 Torrent Transmission

- - - - - - - - -

EZ #DIV/0! - - - - - - - - -

CZ #DIV/0! - - - - - - - - -

WZ #DIV/0! - - - - - - - - -

4 LancoAmarkantak Transmission

- 63.11 - - - - - - 63.11




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

EZ 0.28 - 17.84 - - - - - - 17.84

CZ 0.36 - 22.95 - - - - - - 22.95

WZ 0.35 - 22.32 - - - - - - 22.32

D Total Transmission charges ( 1 to 4)

- 1,531.68 - - - - - - 1,531.68

EZ

- 457.65 - - - - - - 457.65

CZ

- 528.00 - - - - - - 528.00

WZ

- 546.03 - - - - - - 546.03

E TOTAL COST FOR ENERGY

PURCHASE (C+D) 69,860.82 10,428.06 13,121.54 - - 679.79 0.12 234.13 24,463.63

EZ

20,954.71 3,068.09 3,923.29 - - 203.91 0.04 68.37 7,263.70

CZ

23,998.71 3,517.87 4,506.26 - - 235.79 0.03 83.05 8,343.00

WZ

24,907.39 3,842.10 4,691.99 - - 240.09 0.05 82.70 8,856.93

F Supplementary Bills

1,849.27 1,849.27

EZ

- - - - - - - 514.26 514.26

CZ

- - - - - - - 606.40 606.40

WZ

- - - - - - - 728.61 728.61

G

TOTAL COST FOR ENERGY

PURCHASE INCLUDING

SUPPLEMENTRY BILLS (E+F)

69,860.82 10,428.06 13,121.54 - - 679.79 0.12 2,083.39 26,312.90

EZ

20,954.71 3,068.09 3,923.29 - - 203.91 0.04 582.63 7,777.96

CZ

23,998.71 3,517.87 4,506.26 - - 235.79 0.03 689.45 8,949.40

WZ

24,907.39 3,842.10 4,691.99 - - 240.09 0.05 811.32 9,585.54

H

Other costs passed to Discoms -

which cannot be apportioned

station wise-

454.76 454.76

EZ 0.31 - - - - - - - 139.75 139.75




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

CZ 0.34 - - - - - - - 153.48 153.48

WZ 0.36 - - - - - - - 161.53 161.53

I TOTAL COST FOR ENERGY

PURCHASE (G+H) 69,860.82 10,428.06 13,121.54 - - 679.79 0.12 2,538.16 26,767.66

EZ

20,954.71 3,068.09 3,923.29 - - 203.91 0.04 722.38 7,917.71

CZ

23,998.71 3,517.87 4,506.26 - - 235.79 0.03 842.93 9,102.88

WZ

24,907.39 3,842.10 4,691.99 - - 240.09 0.05 972.85 9,747.07

J Less: Other Income

730.34

730.34

EZ 0.31 - - 224.43 - - - -

224.43

CZ 0.34 - - 246.49 - - - -

246.49

WZ 0.36 - - 259.42 - - - -

259.42

K Less: Sale of Power

3,855.89

1,213.90

1,213.90

EZ 0.30 1,145.86 - 362.61 - - - -

362.61

CZ 0.32 1,252.14 - 397.50 - - - -

397.50

WZ 0.38 1,457.89 - 453.78 - - - -

453.78

L Net Total Purchase cost (I-J-K)

66,004.93 10,428.06 11,177.30 - - 679.79 0.12 2,538.16 24,823.42

EZ 0.30 19,808.85 3,068.09 3,336.24 - - 203.91 0.04 722.38 7,330.66

CZ 0.34 22,746.58 3,517.87 3,862.26 - - 235.79 0.03 842.93 8,458.89

WZ 0.36 23,449.50 3,842.10 3,978.79 - - 240.09 0.05 972.85 9,033.87

Other Cost based on MPPMCL

Reconciliation (0.00) (0.00)

EZ

29.49 29.49

CZ

37.02 37.02

WZ

(66.51) (66.51)

MPPMCL Power Purchase Cost

66,004.93 10,428.06 11,177.30 - - 679.79 0.12 2,538.16 24,823.42

EZ

19,808.85 3,068.09 3,336.24 - - 203.91 0.04 751.87 7,360.15




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

CZ

22,746.58 3,517.87 3,862.26 - - 235.79 0.03 879.95 8,495.91

WZ

23,449.50 3,842.10 3,978.79 - - 240.09 0.05 906.34 8,967.36

Supplementary Bills

- - - - - - - 37.11 37.11

EZ

1.73 1.73

CZ

35.38 35.38

WZ

- -

Power Purchase from others

- - - - - - - 4.14 4.14

EZ

4.14 4.14

CZ

-

WZ

-

UI/DSM Charges (Rs Cr)

- - - - - - - 187.53 187.53

EZ

158.82 158.82

CZ

9.39 9.39

WZ

19.32 19.32

Reactive Energy Charges (Rs Cr)

- - - - - - - (2.10) (2.10)

EZ

(4.27) (4.27)

CZ

3.48 3.48

WZ

(1.31) (1.31)

Intra state Transmission Charges

(Rs. Cr) - - - - - - - 2,738.35 2,738.35

EZ

850.83 850.83

CZ

857.30 857.30

WZ

1,030.22 1,030.22

SLDC Charges

- - - - - - - 9.44 9.44

EZ

2.82 2.82




Ratio

MU

Purchased

Total

Capacity

Charges

Total

Energy

Charges

Total

FPA

charges

Income

Tax

ED, Cess,

Heavy

Water

charge,

water

charges

MOPA,

Insurance

Any

Other

Total of all

Charges

CZ

3.01 3.01

WZ

3.61 3.61

Total Power Purchase Cost

66,126.46 10,428.06 11,177.30 - - 679.79 0.12 5,512.63 27,797.89

EZ

20,347.44 3,068.09 3,336.24 - - 203.91 0.04 1,765.94 8,374.22

CZ

22,328.20 3,517.87 3,862.26 - - 235.79 0.03 1,788.51 9,404.47

WZ

23,450.82 3,842.10 3,978.79 - - 240.09 0.05 1,958.18 10,019.20

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 2017-18 was 19,808.85 MUs, 22,746.58 MUs and 23,449.50 MUs respectively which aggregate to 66,004.93 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 (₹ Crores)

Approved Actual Deviation Approved Actual Deviation

A Power Purchase Cost

1 MP State 63,083.00 69,860.82 6,777.82 19,910.07 22,931.96 3,021.89

i East Discom 19434 20,954.71 1,520.71 5746.67 6,806.05 1,059.38

ii Central Discom 20627 23,998.71 3,371.71 6422.29 7,815.00 1,392.71

iii West Discom 23022 24,907.39 1,885.39 7741.11 8,310.90 569.79

B Inter State Transmission Charges

1 MP State

1,406.00 1,531.68 125.68

i East Discom

434.39 457.65 23.26

ii Central Discom

419.97 528.00 108.03

iii West Discom

551.64 546.03 (5.61)



Sr.

No Particulars



C Intra State Transmission Charges including SLDC

1 MP State

2,532.37 2,747.79 215.42

i East Discom

756.67 853.65 96.98

ii Central Discom

806.05 860.31 54.26

iii West Discom

969.65 1,033.83 64.18

D Supplementary Bill Charges

1 MP State

1,849.27 1,849.27

i East Discom

514.26 514.26

ii Central Discom

606.40 606.40

iii West Discom

728.61 728.61

E Costs which cannot be apportioned station wise to

be passed on to Discom's- MPPMCL Cost

1 MP State

454.76 454.76

i East Discom

139.75 139.75

ii Central Discom

153.48 153.48

iii West Discom

161.53 161.53

F Other Charges- UI/DSM and RE Charges

1 MP State

121.53 121.53

226.68 226.68

i East Discom

538.59 538.59

160.42 160.42

ii Central Discom

(418.37) (418.37)

48.25 48.25

iii West Discom

1.32 1.32

18.01 18.01

G Less: Other Income

1 MP State

730.34 730.34

i East Discom

224.43 224.43

ii Central Discom

246.49 246.49

iii West Discom

259.42 259.42

H Less: Sale of Surplus Power

1 MP State

3,855.89

1,213.90 1,213.90



Sr.

No Particulars



i East Discom 1,145.86

362.61 362.61

ii Central Discom 1,252.14

397.50 397.50

iii West Discom 1,457.89

453.78 453.78

I Other Adjustment Based on Reconciliation

1 MP State

(0.00) (0.00)

i East Discom

29.49 29.49

ii Central Discom

37.02 37.02

iii West Discom

(66.51) (66.51)

J Net Power Purchase Cost

1 MP State

66,126.46 66,126.46 23,848.44 27,797.89 3,949.46

i East Discom

20,347.44 20,347.44 6,937.73 8,374.22 1,436.49

ii Central Discom

22,328.20 22,328.20 7,648.31 9,404.47 1,756.16

iii West Discom

23,450.82 23,450.82 9,262.39 10,019.20 756.81

Note: Approved Quantum of Energy after consideration of sale of surplus power

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 2017-18, 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. 8,374.22 Cr. which is higher by Rs. 1436.49 Cr. than the cost approved in the Tariff Order FY 2017-18.

2.5.2 Power purchase Cost as per accounts for Central Discom: For power procured during FY 2017-18, 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. 9,404.47 Cr. which is higher by Rs. 1756.16 Cr. than the cost approved in the Tariff Order FY 2017-18.

2.5.3 Power purchase Cost as per accounts for West Discom: For power procured during FY 2017-18, 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. 10,019.20 Cr. which is higher by Rs. 756.81 Cr. than the cost approved in the Tariff Order FY 2017-18.


MPPMCL / MPPoKVVCL/MPMKVVCL/MPPaKVVCL P a g e | 31

T3: ENERGY SALES

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

3.1.1 The Discoms served nearly 14,311,051number of consumers at LT level and has

around 7,032number of consumers connected at HT level during FY 2017-18. 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 2017-18 dated 31st

March 2017 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 2017-18.

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 2017-18

Sr.no. Category Approved Actual Deviation

A LT

NO

T A

VA

ILA

BL

E I

N T

AR

IFF

OR

DE

R

NO

T A

PP

LIC

AB

LE

1 MP State 14,311,051

i East Discom 5,317,121

ii Central Discom 3,900,059

iii West Discom 5,093,871

B HT

1 MP State 7,032

i East Discom 1,480

ii Central Discom 2,240

iii West Discom 3,312

C Total

1 MP State 14,318,083




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 2017-18 (kW)


A LT

NO

T A

VA

ILA

BL

E I

N

TA

RIF

F O

RD

ER

NO

T A

PP

LIC

AB

LE

1 MP State 21,325,147




B HT

1 MP State 2,831,948




i East Discom 847,319

ii Central Discom 856,324


C Total

1 MP State 24,157,095




3.1.4 The commission has approved the sales of 15,278 MUs, 16021 MUs and 18,426 MUs

for East Discom, Central Discom and West Discom respectively for FY 2017-18.

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 2017-18 (MUs)


A LT

1 MP State 38,330.00 35,174.17 (3,155.83)

i East Discom 12,015.00 11,008.58 (1,006.42)

ii Central Discom 12,034.00 9,908.62 (2,125.38)

iii West Discom 14,281.00 14,256.98 (24.02)

B HT

1 MP State 11,395.00 10,826.19 (568.81)

i East Discom 3,263.00 3,094.15 (168.85)

ii Central Discom 3,987.00 3,367.80 (619.20)

iii West Discom 4,145.00 4,364.25 219.25

C Total

1 MP State 49,725.00 46,000.37 (3,724.63)

i East Discom 15,278.00 14,103 (1,175.27)

ii Central Discom 16,021.00 13,276 (2,744.59)

iii West Discom 18,426.00 18,621 195.23

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

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

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



Table 7: Month & Category wise Sale for FY 2017-18 (MUs)

B Category Wise

Low Voltage High Voltage

Total Domestic Non-

Domestic

PWW &

St. Lt.

Indl. Agri. &

Allied

Service

Railways Coal

Mines

Indl. &

Non-Indl

Seasonal

Ind.

Irrig.,

PWW &

Ors

BS Start Up

& Sync

I MP State 11,800.84 2,890.13 1,209.56 1,213.78 18,059.86 - 479.54 8,964.81 21.76 894.74 424.85 40.50 46,000.37

1 East 4,170.44 967.33 427.68 354.02 5,089.11 - 453.33 2,256.60 8.00 110.25 265.97 - 14,102.73

2 Central 3,790.38 885.26 345.78 273.43 4,613.77 - 26.21 2,976.47 1.60 207.42 146.64 9.45 13,276.41

3 West 3,840.02 1,037.54 436.10 586.33 8,356.99 - - 3,731.74 12.16 577.06 12.24 31.04 18,621.23

3.3 The Petitioners hereby request the Hon’ble Commission to approve sales as i.e. 14,102.73 MUs for the East Discom, 13,276.41 MUs for

Central Discom and 18,621.23 MUs for the West Discom aggregating to a total 46,000.37 MUs for the MP State for FY 2017-18 which

is about 3,724.63 MUs lower than that approved in the Tariff Order dated 31st March 2017 for the MP State, 1,175.27 MUs for East

Discom, 2,744.59 MUs for the Central Discom and 195.23 MUs higher for the West Discom respectively.

3.4 Method of determination of Power Purchase Cost

3.4.1 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.

3.4.2 The method of calculation of power purchase cost for excessive loss over and above the normative loss is proposed to be as below:

3.4.3 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.



3.4.4 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.

3.4.5 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.

3.4.6 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)



(e) 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.

(f) 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)

3.5 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.”

3.6 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.

3.7 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 2017-18.

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

A Particulars Index East Central West MP State

1 Actual Sales MUs 14,102.73 13,276.41 18,621.23 46,000.37

2 Normative Loss % 17.00% 18.00% 15.50% 16.69%

3 Input at T&D Periphery (A1/1-A2) MUs 16,991.24 16,190.75 22,036.95 55,218.94

4 MP Transco Loss - Approved % 2.87% 2.87% 2.87% 2.87%

5 Input at G-T Interface (A3/1-A4) MUs 17,493.30 16,669.15 22,688.10 56,850.55

6 Inter- Transmission Losses- Approved MUs 482.00 511.00 571.00 1,564.00

7 Power Purchase Requirement (A5+A6) MUs 17,975.30 17,180.15 23,259.10 58,414.55



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 20,347.44 22,328.20 23,450.82 66,126.46

2 Cost of Power Purchase as per Audited

Accounts Rs Cr 8,374.22 9,404.47 10,019.20 27,797.89

3 Supplementary Bills of Previous FYs Rs Cr 514.26 606.40 728.61 1,849.27

4 Net Power Purchase Cost (B2-B3) Rs Cr 7,859.96 8,798.07 9,290.59 25,948.63

5 Fixed Cost for FY 2017-18 Rs Cr 2,610.44 2,989.87 3,296.07 8,896.38

6 Inter Transmission Charges for FY

2017-18 Rs Cr 457.65 528.00 546.03 1,531.68

7 Intra Transmission Charges for FY

2017-18 Rs Cr 850.83 857.30 1,030.22 2,747.79

8 Other Cost of MPPMCL which cannot

be apportioned Rs Cr 139.75 153.48 161.53 454.76

9 Variable Cost for FY-17 (B4-B5-B6-B7-

B8) Rs Cr 3,801.29 4,269.42 4,256.74 12,318.02

10 Pooled Variable Rate (B9/B1*1000) Paisa/kWh 186.82 191.21 181.52 186.28

11 Quantum of Power Purchase as per

Normative Losses MUs 17,975.30 17,180.15 23,259.10 58,414.55

12 Variable Cost to be Admitted

(B10*B9/1000) Rs Cr 3,358.13 3,285.05 4,221.94 10,856.74

13 Supplementary Bills of Previous FYs

added back Rs Cr 514.26 606.40 728.61 1,849.27

14 Total Power Purchase Cost to be

Admitted (B5+B6+B7+B8+B12+B13) Rs Cr 7,931.06 8,420.10 9,984.40 26,336.61

3.8 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.

3.9 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 14,102.73 13,276.41 18,621.23 46,000.37

2 Actual Distribution Loss (%) 27.05% 37.51% 16.57% 26.86%

3 Actual Distribution Loss (MU) 5,229.32 7,968.82 3,698.35 16,896.50

4 Input at T-D interface- Actual Drawl as

per DSM/UI Sheet 19,316.12 21,316.74 22,627.29 63,260.16

5 Input at T-D interface as per Energy

Audit/Approved by the Commission 19,332.05 21,245.24 22,319.58 62,896.86

6

Difference of MUs between Energy Audit

and Input at T-D interface including Direct

Purchase due to BUS Losses

10.71 (71.50) (307.72) (368.50)

7 Inter State UI at Discom Periphery 538.59 (418.37) 1.32 121.53

8 Total Schedule Energy at T-D interface

including UI 18,777.54 21,735.11 22,625.97 63,138.62

9 External & Transmission Losses (MUs) 593.09 824.85 (343.16) 1,569.90

10 Ex-Bus Requirement Schedule Energy as

per MPPMCL Statement 20,347.44 22,328.20 23,450.82 66,126.46

Proposed methodology:

3.10 In this methodology, the licensee adopts the Hon’bleAptel’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.

3.11 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.

3.12 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.

Proposed methodology for calculating power purchase cost for disallowed units:



3.13 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.

3.14 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.

3.15 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



3.16 In view of above the Power Purchase cost for the year 2017-18 may please be

considered as indicated in the following tables:-

Table 15: Details of power purchase cost to be allowed for East Discom FY 2017-18 (Rs Cr)

Sr.no. Particulars Actual PP to be

allowed

Variance

1 Normative loss level 17.00% - -

2 Actual loss level 27.05% - -

3 Loss over and above the normative loss 10.05% - -

4 Fixed cost (Rs. Cr) 2,610.44 2,610.44 -

5 Previous years' supplementary bills of Generators

(Rs Cr) 514.26 507.52 6.74

6 Variable cost (Rs. Cr) 3,923.29 - -

Sale of additional power (Rs. Cr) 362.61 - -

Other Income (Rs. Cr) 224.43 - -

Variable cost after adjusting Sale of additional

Power & Other income (Rs. Cr) 3,336.24 3,000.95 335.29

Other Charges (Total FPA charges +Income

Tax+ED, Cess, Heavy Water charge, water

charges+MOPA, Insurance+Any Other charges)

272.32 244.96 27.37

Other costs passed to Discoms - which cannot be

apportioned station wise- 139.75 139.75 -

7 Inter state Transmission charges for FY 2013-14

(Rs. Cr) 457.65 457.65 -

9 Supplymetnory Cost of FY 2014-15 &FY 2015-16

based on Reconcialation of MPPMCL (Rs Cr) 29.49 26.53 2.96

MPPMCL Power Purchase Cost (Rs Cr) 7,360.15 6,987.79 372.36

Supplymentory bills of Previous year 1.73 1.73 -

10 Power Purchase from others 4.14 4.14 -

11 UI/DSM Charges (Rs Cr) 158.82 158.82 -

12 Reactive Energy Charges (Rs Cr) -

4.27 -

4.27 -

13 Intra state Transmission Charges (Rs. Cr) 850.83 850.83 -

14 SLDC Charges 2.82 2.82 -

Other adjustments - - -

Total Power Purchase Cost to be allowed (Rs Cr) 8,374.22 8,001.86 372.36

Table 16: Details of power purchase cost to be allowed for Central Discom FY 2017-18 (Rs Cr)


allowed

Variance

1 Normative loss level 18%

2 Actual loss level 37.51%

3 Loss over and above the normative loss 19.51%

4 Fixed cost (Rs. Cr) 2,989.87 2,989.87 -


(Rs Cr) 606.40 594.89 11.51

6 Variable cost (Rs. Cr) 4,506.26

Sale of additional power (Rs. Cr) 397.50

Other Income (Rs. Cr) 246.49

Variable cost after adjusting Sale of additional 3,862.26 3,108.78 753.48




allowed

Variance

Power & Other income (Rs. Cr)




318.87 256.66 62.21



7 Interstate Transmission charges for FY 2013-14 (Rs.

Cr) 528.00 528.00 -

9 Supplementary Cost of FY 2014-15 &FY 2015-16

based on Reconciliation of MPPMCL (Rs Cr) 37.02 29.80 7.22


Supplementary bills of Previous year 35.38 35.38 -

10 Power Purchase from others

- -


12 Reactive Energy Charges (Rs Cr) 3.48 3.48 -

13 Intra state Transmission Charges (Rs. Cr) 857.30 857.30 -


Other adjustments


Table 17: Details of power purchase cost to be allowed for West Discom FY 2017-18 (Rs Cr)


allowed

Variance

1 Normative loss level 15.50%

2 Actual loss level 16.57%

3 Loss over and above the normative loss 1.07%

4 Fixed cost (Rs. Cr) 3,296.07 3,296.07 -


(Rs Cr) 728.61 724.90 3.71

6 Variable cost (Rs. Cr) 4,691.99

Sale of additional power (Rs. Cr) 453.78

Other Income (Rs. Cr) 259.42

Variable cost after adjusting Sale of additional

Power & Other income (Rs. Cr) 3,978.79 3,936.22 42.57




322.84 319.39 3.45



7 Interstate Transmission charges for FY 2013-14 (Rs.

Cr) 546.03 546.03 -

9 Supplementary Cost of FY 2014-15 &FY 2015-16

based on Reconciliation of MPPMCL (Rs Cr) (66.51) (65.80) (0.71)


Supplementary bills of Previous year

- -

10 Power Purchase from others

- -


12 Reactive Energy Charges (Rs Cr) (1.31) (1.31) -




allowed

Variance

13 Intra state Transmission Charges (Rs. Cr) 1,030.22 1,030.22 -


Other adjustments


3.17 Comparison of power purchase cost as per Commission Methodology &

Proposed Methodology by petitioners

3.17.1 There is an overall difference of Rs 205.47 Cr which may be allowed additionally to

the petitioners if the proposed methodology as proposed by the petitioners is adopted

by Hon’ble Commission.

3.17.2 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 7,931.39 8,420.80 9,984.43 26,336.61

2 Power Purchase Cost as per proposed

Methodology by petitioners 8,001.86 8,570.05 9,970.17 26,542.08

3 Difference 70.47 149.25 (14.26) 205.47



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. 1368.18

Cr, Rs1284.61 and Rs1341.09Cr for East Discom, Central Discom and West Discom

respectively in its Tariff order for FY 2017-18, 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 2017-18 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 2017-18

Sr.

no.

Particulars Index Discom Allowed in

TO

(A)

Claimed

(B)

Variance

(B-A)

1

Employee Cost

(Including terminal

benefits)

Rs Cr EZ 1,037.28 822.48 214.80

Rs Cr CZ 997.17 1,127.85 (130.68)

Rs Cr WZ 1,067.45 731.24 336.21

Rs Cr MP State 3,101.90 2,681.57 420.33

3

Administrative &

General Expenses

including MPERC Fees

Rs Cr EZ 179.50 218.90 (39.40)

Rs Cr CZ 103.50 133.55 (30.05)

Rs Cr WZ 138.50 152.73 (14.23)

Rs Cr MP State 421.50 505.18 (83.68)

4 Repair & Maintenance

Expenses

Rs Cr EZ 151.40 168.84 (17.44)

Rs Cr CZ 183.94 145.58 38.36

Rs Cr WZ 135.14 136.32 (1.18)

Rs Cr MP State 470.48 450.74 19.74

5 Total O&M Charges

Rs Cr EZ 1,368.18 1,210.22 157.96

Rs Cr CZ 1,284.61 1,406.98 (122.37)

Rs Cr WZ 1,341.09 1,020.29 320.80

Rs Cr MP State 3,993.88 3,637.49 356.39



4.5 Submission of East Discom:

4.5.1 For FY 2017-18, O&M expenses are Rs 1,210.22 Cr. which comprises of employee’s

expenses to the tune of Rs. 822.48Cr (expense capitalised Rs28.91 Cr and net expense

is Rs 793.57 Cr), R&M expenses to the tune of Rs. 168.84Cr (expense capitalised

Rs7.06Cr and net expense is Rs161.78 Cr)and A&G expenses Rs218.90Cr. The

petitioner is also claiming the cost of actual cash outflow towards terminal benefits to

the tune of Rs41.28Cr 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 1210.22 Cr. for FY 2017-18may 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. 1,127.85Cr

including of terminal benefits of Rs. 5.09 Cr towards Employee expenses, A&G

expenses of Rs. 133.55Cr, and R&M expenses of Rs. 145.58Cr for FY 2017-18.


the tune of Rs 1,406.98 Cr for FY 2017-18 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. 731.24Cr

including of terminal benefits of Rs. 14.84 Cr towards Employee expenses, A&G

expenses of Rs. 152.73Cr, and R&M expenses of Rs. 136.32Cr for FY 2017-18.


the tune of Rs 1,019.99 Cr. for FY 2017-18 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 31st March 2017 had approved

Interest on Project Loans as Rs.106.69 Cr for the East Discom, Rs. 238.10Cr for the

Central Discom, Rs 67.53 Cr for the West Discom and Rs. 412.32 Cr for the MP State

respectively.


5.2.1 The actual/accrued interest on project loans of the petitioner for the year FY 2017-18

is Rs922.81 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.

5.2.2 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 2017-18 (Rs Cr)

Particulars

As per

Audited

Accounts

As Approved

in Tariff

Order

Claimed

Opening Debt associated with GFA (as on 01st April

2017 as Per Tariff Order for FY 2017-18)

94.75 1,611.30

GFA Addition During the FY 485

Consumer Deposit and Grants utilized during the FY 243.89

Net GFA Addition during the FY 241.26

70% of addition to net GFA considered as funded

through debt

168.88

Debt repayment during the FY (Equal to Depreciation) 335.28

Closing debt associated with GFA 1,444.90

Average debt associated with GFA 1,528.10

Weighted Average Interest Rate (%) 8.97%

Interest on Project Loan 137.13

11.95

Add: Other Finance Cost

On loans from banks 30.47

On loans from government 82.94

On Perpetual loans from government 880.41

Bank Commission & Other Charges 5.11 5.11

Cost of Raising Finance, Gurantee Charges & Stamp

Duty, Commitment Charges

3.82 3.82

Penalty Charges of Delayed Payment or Rebate to

Consumers on Timely Payment

4.02 4.02

Total Interest on Project Loan 1006.77

Interest expenses capitalsed -83.96 -

Net Interest on Project Loan 922.81 106.69 150.08



5.3 Submission of Central Discom

5.3.1 The actual net interest payments against current dues in FY 2017-18 (excluding any

payments against previous year defaults of principal or interest or any penal charges

on such defaults) is Rs. 6.37 Cr.

5.3.2 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 2017-18 (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)

6.37

Interest capitalized to project works -

Net Interest on Project Loan 238.10 6.37


5.4.1 The actual/accrued interest on project loans of the petitioner for the year FY 2017-18

is Rs906.96 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.

5.4.2 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 2017-18

Particular Approved in

Tariff Order

Claimed Variance

A Opening Debt associated with GFA (as on 01st April

2017 as Per FY 2016-17 True-up Petition) 465.85

B GFA Addition During the FY

603.94

C Consumer Deposit and Grants

utilized during the FY 517.45

D Net GFA Addition during the FY

86.49

E 70% of addition to net GFA

considered as funded through debt 60.54

F Debt repayment during the FY (Equal to

Depreciation) 244.33

G Closing debt associated with GFA

282.06

H Average debt associated with GFA

373.96

I Weighted Average Interest Rate (%)

9.16%

J Interest on Project Loan 58.58 34.24

-

K Add: Other Finance Cost

10.27



Particular Approved in

Tariff Order

Claimed Variance

i Bank Commission & Other Charges

8.95

6.74

ii Cost of Raising Finance, Gurantee Charges & Stamp

Duty, Commitment Charges 0.45

iii Penalty Charges of Delayed Payment or Rebate to

Consumers on Timely Payment 3.08

II Net Interest on Project Loan 67.53 44.51 - 23.02

5.4.3 West Discom thus requests the Hon’ble Commission for the approval of Interest and

Finance Charges of Rs. 44.51 Cr on account of true up towards Interest on project

loan.

5.5 Interest on Working Capital Loans

5.5.1 The Commission in the Tariff Order for FY 2017-18 has allowed Rs. 85.97 Cr for

East Discom, Rs. 46.38 Cr for Central Discom and Rs. 63.99 Cr for West Discom as

interest on the working capitalas per the norms specified in the Regulation.


5.6.1 The petitioner submits that the interest on working capital approved in the tariff order

was Rs85.97 Cr which was based on the norms as specified in the terms and

conditions of tariff regulations, 2015.

5.6.2 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 2017-18 is Rs72.61Cr.

5.6.3 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 2017-18

For Wheeling activity

Sr.

No.

Particulars Allowed in

Tariff Order

Actual

A) 1/6th of annual requirement of inventory for previous year at 1 %

GFA for previous year (80%)

8.78 55.94

B) Total of O&M expenses 1,368.18 1,210.22

B) i) 1/12th of total 114.02 100.85

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 122.80 156.79

(A), B) i), C) ii))

E) Rate of Interest * 14.00% 13.85%

F) Interest on Working capital -wheeling 17.19 21.72



For Retail Sale activity

Sl. No. Particulars Allowed in

Tariff Order

Actual

A) 1/6th of annual requirement of inventory for previous year (20%) 2.19 13.98

B) Receivables -

B) i) Annual Revenue 8,624.42 8,332.88

B) ii) Receivables equivalent to 2 months average billing 1,437.40 1,388.81

C) Power Purchase expenses 5,746.67 5,611.39

C) i) 1/12th of power purchase expenses 478.89 467.62

D Consuner Security Deposit 469.42 724.51

E) Total Working capital (A+B ii) - C i) - D) 491.29 210.67

F) Rate of Interest * 14.00% 13.85%

G) Interest on Working capital -Retail 68.78 29.18

Total Interest on Working capital -Wheeling 17.19 21.72

Net Interest on Working capital -Retail 68.78 50.89

Total Interest on Working Capital(Wheeling+Retail) 85.97 72.61


5.7.1 Interest on Working Capital as approved in the Tariff order for the period FY17-18

was Rs. 46.38 Cr. However, the actual interest on Working Capital for the Licensee is

Rs. 35.69 Cr as per Actuals for FY 2017-18.

5.7.2 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.

5.7.3 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 2017-18 and allow expenses on account of interest on

Working Capital to the tune of Rs. 35.69 Cr.


5.8.1 The petitioner submits that Hon’ble Commission in its tariff order dated 31st

March’2017 has allowed Rs. 63.99 Cr towards interest on working capital in respect

of West Discoms as per the norms specified in the Terms & Conditions of Tariff

Regulations, 2015.



5.8.2 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 2017-18 is Rs 37.73 Cr.

5.8.3 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 2017-18

A Interest on Working Capital - Retail As per the

Tariff

Order

As per the

Regulations

Variance

Inventory - 20% of 2 Month Proportionate of 1% GFA 1.96 1.98

O&M Expenses - 10% of 1 Month Proportionate - 8.50

Revenue from Retail -2 Month 1,787.47 2,007.42

Gross Working Capital Requirement 1,789.43 2,017.90

Less: Power Purchase Cost - 1 Month 645.09 830.85

Less: Consumer Security Deposit 807.34 973.29

Net Working Capital Requirement 337.00 213.76

Interest Rate on Working Capital (%) 14.00% 12.60%

Interest - Retail 47.18 26.93

B Interest on Working Capital - Wheeling

Inventory - 80% of 2 Month Proportionate of 1% GFA 7.83 7.90

O&M Expenses - 90% of 1 Month Proportionate 111.76 76.50

Revenue from Wheeling - 2 Month 0.48 1.28

Net Working Capital Requirement 120.07 85.68

Interest Rate on Working Capital (%) 14.00% 12.60%

Interest - Wheeling 16.81 10.80

C Interest on Working capital 63.99 37.73 (26.26)

5.9 Interest on Consumer Security Deposit

5.9.1 Interest on Consumer Security Deposit (CSD) approved in the Tariff Order for the

period FY 2017-18 was Rs31.69 Cr, Rs56.16 Cr and Rs54.50 Cr for East Discom,

Central Discom and West Discom respectively.

5.9.2 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.

5.9.3 However, the actual Interest on consumer security deposits for the period FY 2017-18

for the East Discom was Rs55.79 Cr, Central Discom was Rs52.89Cr and West

Discom was Rs63.59Cr.

5.9.4 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 2017-18

Discom Allowed in the

Tariff Order

Actual as per

Accounts

Variance

EZ 31.69 55.79 (24.10)

CZ 56.16 52.89 3.27

WZ 54.50 63.59 (9.09)

MP State 142.34 172.27 (29.93)

5.9.5 The petitioners thus prays to allow Rs. 172.27 Cr on account of Interest on Consumer

Security Deposits for FY 2017-18.

5.10 Summary of Interest and Finance Charges

5.10.1 The petitioners hereby submit that an amount of Rs278.48 Cr, Rs94.95 Cr and Rs

145.83 Cr may be kindly approved against interest and finance charges for East

Discom, Central Discom and West Discom respectively towards true up of FY 2017-

18.

5.10.2 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 2017-18

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 106.69 150.08 (43.39)

Rs Cr CZ 238.10 6.37 231.73

Rs Cr WZ 67.53 44.51 23.02

Rs Cr MP State 412.32 200.96 211.36

2

Interest on Working

Capital Loan Claimed as

per regulation/audited

accounts

Rs Cr EZ 85.97 72.61 13.36

Rs Cr CZ 46.38 35.69 10.69

Rs Cr WZ 63.99 37.73 26.26

Rs Cr MP State 106.88 146.03 (39.15)

3

Interest on consumer

Security Deposit as per

accounts

Rs Cr EZ 31.69 55.79 (24.10)

Rs Cr CZ 56.16 52.89 3.27

Rs Cr WZ 54.50 63.59 (9.09)

Rs Cr MP State 225.28 172.27 53.01

4 Total Interest & Finance

Charges (1+2+3)

Rs Cr EZ 224.35 278.48 (54.13)

Rs Cr CZ 340.64 94.95 245.69

Rs Cr WZ 186.02 145.83 40.19

Rs Cr MP State 751.01 519.26 231.75



T6: DEPRECIATION AND RELATED DEBITS

6.1 Hon’ble Commission in its Tariff Order dated 31st March, 2017 had approved

depreciation net of consumer contribution & grants as Rs. 116.50 Cr for the East

Discom, Rs. 159.54 Cr for the Central Discom and Rs. 105.05 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,

Discomcan 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 2017-18.

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 2017-18

Sr.

no.


Tariff Order

(A)

Actual Claimed

now as Per

Regulation /

Accounts

(B)

Variance

(A-B)

1 EZ 116.50 335.28 (218.78)

2 CZ 159.54 300.71 (141.17)

3 WZ 105.05 244.33 (139.28)

4 MP State 381.09 880.33 (499.24)




6.5.1 The Licensee hereby prays to the Hon’ble Commission to allow depreciation of

Rs335.28 Cr as per the audited accounts over against the approved depreciation of

Rs.116.50for East Discom in the Tariff Order for the period FY 2017-18.


6.6.1 The Licensee hereby prays to the Hon’ble Commission to allow depreciation of

Rs300.71 Cr as per the audited accounts over against the approved depreciation of

Rs.159.54 for Central Discom in the Tariff Order for the period FY 2017-18.


6.7.1 The petitioner has calculated the depreciation of Rs. 244.33Cr as per regulations for

FY 2017-18 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 Rs244.33 towards true up of depreciation for FY 2017-18.



T7: BAD AND DOUBTFUL DEBTS

7.1.1 The Hon’ble Commission in its Tariff Order for FY 2017-18 dated 31st March 2017

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 2017-18 as shown below:

7.2 Submission of East Discom

7.2.1 Actual Bad and Doubtful Debts as per Annual Accounts is Rs14.75Cr.The Petitioner

has claimed only the actual bad debts to the tune of Rs14.75 Cr. that were actually

written off in the annual accounts of FY 2017-18, which may be allowed in true-up of

FY 2017-18.


7.3.1 The petitioner submits that the actual bad and doubtful debts written off during the FY

2017-18 was Rs 23.28 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 o

f bad debts for FY 2017-18.


7.4.1 The petitioner submits that the actual bad and doubtful debts written off during the FY

2017-18 was Rs237 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 2017-18.

7.4.2 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 2017-18

Sr.no. Discom Allowed in the

Tariff Order

Actual Claimed

As Per

Accounts

Variance

1 East Discom 2.00 14.75 (12.75)

2 Central Discom 2.00 23.28 (21.28)

3 West Discom 2.00 237.00 (235.00)

4 MP State 6.00 275.03 (269.03)



T8: OTHER EXPENSES


8.1.1 The licensee submits that the amount towards prior period credits including other

expenses is Rs0.52 Cr. The details of the same are as shown in the table below:

Table 29: Other Expenses Claimed as true up for FY 2017-18

Sr.no. Particulars Allowed in the

Tariff Order

Actual Claimed

As Per

Accounts

1 Sundry Expenses/Miscellaneous Losses - 0.52

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 Rs0.52 Cr on account of true

up of FY 2017-18.

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. 7045/R-4197/2015/XIII, from PS

Energy, Bhopal dated 06/11/2017, M. P. Power Transmission Co. Ltd., Jabalpur has

written off liabilities of Discom to an extent of Rs. 141.06 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.

8.2.2 Submission of Central Discom






8.2.3 Submission of West Discom








T9: RETURN ON EQUITY

9.1 The Hon’ble Commission in its Tariff Order for FY 2017-18 dated 31st March 2017

had approved return on equity as Rs. 219.05 Cr for East Discom, Rs. 302.14 Cr for

Central Discom and Rs. 177.63 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 Actual GFA. Equity component of GFA addition equal to 30%

of net addition in FY 2017-18 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 2017-18

Sr.

no.


the Tariff

Order

(A)

Actuals

(B)

A Gross Fixed Assets at the beginning of year (net of consumer

contributions)

5,425.05

A1 Opening balance of equity 1,883.54

B Actual capitalization of assets as per Annual Accounts (net of

consumer contribution) 241.26

B1 Addition of equity, internal reserves during the year for

capitalized assets 1,557.88

C1 Normative additional Equity (30% of B) 72.38

D1 Excess / shortfall of additional equity over normative (B1-C1) 1,485.50

E Equity eligible for Return (A1+(C1/2)) OR (A1+(B1/2)),

whichever is lower 1,919.73

F Return on Equity - (16% on E) 219.05 307.16

9.1.2 Submission of Central Discom



equity associated with actual GFA. Equity component of GFA addition equal to 30%

of net addition in FY 2017-18 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 31: ROE Claimed by CZ as true up for FY 2017-18

Sr.

no.


the Tariff

Order

(A)

Actuals

(B)

A Gross Fixed Assets at the beginning of year (net of consumer

4,893.07



Sr.

no.


the Tariff

Order

(A)

Actuals

(B)

contributions)

A1 Opening balance of equity 1,961.12

B Actual capitalization of assets as per Annual Accounts (net of

consumer contribution) 201.18

B1 Addition of equity, internal reserves during the year for

capitalized assets 1,750.22

C1 Normative additional Equity (30% of B) 60.35

D1 Excess / shortfall of additional equity over normative (B1-

C1) 1,689.87

E Equity eligible for Return (A1+(C1/2)) OR (A1+(B1/2)),

whichever is lower 1,991.30

F Return on Equity - (16% on E) 302.14 318.61

9.1.3 Submission of West Discom



equity associated with GFA (as on 31st March 2017 as per True-up Order for FY

2016-17). Since the True-up Order for FY 2016-17 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 2017-18 .Equity component of GFA addition equal to 30% of net

addition in FY 2017-18 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 32: ROE Claimed by WZ as true up for FY 2017-18

Sr.

no.


the Tariff

Order

(Rs. Crs.)

Actuals in

(Rs. Cr)

A Opening Equity Identified with GFA (as on 01st April 2017

as Per FY 2016-17 True-up Petition)

1,077.08

B GFA Addition During the FY 603.94

C Consumer Deposit and Grants utilized during the FY 517.45

D Net GFA Addition during the FY 86.49

E 30% of addition to net GFA considered as funded through

Equity 25.95

F Closing Equity Identified with GFA (as on 31st March 2017) 1,103.03

G Average Equity associated with GFA 1,090.06

H Rate of Return on Equity (%) 16% 16%

I Return on Equity 177.63 174.41

9.2 The petitioners, thus prays the Hon’ble Commission to allow Return on Equity

amounting to Rs307.16 Cr, Rs318.61 and Rs174.41 for East Discom, Central Discom

and West Discom respectively for FY 2017-18 as shown in below table .



Table 33: ROE Claimed by Petitioners for FY 2017-18

Sr.

no.


Tariff Order

Actual Claimed

Now As Per

Regulation

/ Accounts

Variance

1 East Discom 219.05 307.16 (88.11)

2 Central Discom 302.14 318.61 (16.47)

3 West Discom 177.63 174.41 3.22

4 MP State 698.82 800.17 (101.35)

T10: TAXES

10.1 The petitioners submits that for the period FY 2017-18 they have incurred a loss of Rs

2190.46 Cr & Rs 2,716.79 Cr for respective East Discom & Central Discom and a

profit of Rs. 157 Cr for West Discom 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 2017-18 the licensee has capitalised 122.92 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 2017-18

Sr.

no.

Particulars As Approved

in Tariff

Order

Actual as per

audited

accounts

1 Capitalization of base investment

-

2 Capitalization of expenses:--

Interest & Finance charges Capitalized

(83.96)

Employee expenses Not (28.91)

R&M Expenses indicated in (7.06)

A&G Expenses Tariff Order (3.0)

Others, if any

-

3 Capitalization of depreciation, if any

-

Grand Total (1+2+3)

(122.92)

11.1.2 The licensee hereby prays to the Hon’ble commission to allow the other expenses

capitalised of Rs. 122.92 for FY 2017-18.

11.2 Submission of Central Discom:



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 2017-18

Sr.

no.


in Tariff

Order

Actual as per

audited

accounts


-



Employee expenses Not (27.75)

R&M Expenses indicated in

A&G Expenses Tariff Order

Others, if any

-


-

Grand Total (1+2+3)

(27.75)



11.3 Submission of West Discom:



R&M Expenses and capitalised A&G Expenses and interest and finance charges

capitalised.

Table 36: Other expenses capitalized claimed by West Discom for FY 2017-18

Sr.

no.


in Tariff

Order

Actual as per

audited

accounts


-



33.34

Employee expenses Not 24.53

R&M Expenses indicated in 0.46

A&G Expenses Tariff Order 7.12

Others, if any


-

Grand Total (1+2+3)

65.46



T12: OTHER INCOME

12.1 The Hon’ble Commission in its Tariff Order for FY 2017-18 dated 31st March 2017

had approved other income and non-tariff income as Rs. 243.40 Cr for the East

Discom, Rs. 268.57 Cr for the Central Discom and Rs. 349.37 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 2017-18 as per below table.

Table 37: Other income claimed by Petitioners for FY 2017-18

Sr.

no.


Tariff Order

Actual Claimed

Now As Per

Regulation

/ Accounts

Variance

1 East Discom 243.40 316.77 (73.37)

2 Central Discom 349.37 342.26 7.11

3 West Discom 268.57 144.32 124.25

4 MP State 861.34 803.35 57.99

12.3 The Petitioners hereby pray to the Hon’ble Commission to approve Rs. 316.77 Cr for

the East Discom, Rs. 342.26 Cr for the Central Discom and Rs. 144.32 Cr for the

West Discom respectively for FY 2017-18 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

15,278 MU for the period FY 2017-18. However, the actual sales were14102.73 MU,

which are lower by 1,176.27 MU than what has been approved in the Tariff order for

FY 2017-18. The revenue from sales has also been lower by Rs. 1086.12 Cr. The

details are shown in the table below:

Table 38: Revenue from Sales for East Discom FY 2017-18

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 12,015.00 6,929.00 11,008.58 5,986.20 (1,006.42) (942.80)

LV 1: Domestic 4,262.00 2,493.00 4,170.44 2,079.32 (91.56) (413.68)

LV 2: Non-Domestic 1,051.00 848.00 967.33 726.43 (83.67) (121.57)

LV 3: Public Water Works & Street

Lights 408.00 238.00 427.68 194.93 19.68 (43.07)

LV 4: LT Industry 365.00 291.00 354.02 273.06 (10.98) (17.94)

LV 5: Irrigation pump for

Agriculture 5,929.00 3,059.00 5,089.11 2,712.45 (839.89) (346.55)

HIGH TENSION 3,264.00 2,492.00 3,094.15 2,285.16 (169.85) (206.84)

HV 1: Railway Traction - - - - - -

HV 2: Coal Mines 463.00 376.00 453.33 353.37 (9.67) (22.63)

HV-3: Industrial & Non-Industrial 2,344.00 1,830.00 2,256.60 1,684.46 (87.40) (145.54)

HV-4: Seasonal 9.00 7.00 8.00 7.66 (1.00) 0.66

HV-5: HT Irrigation & Water

Works 162.00 96.00 110.25 70.28 (51.75) (25.72)

HV 6: Bulk Residential Users 286.00 183.00 265.97 169.40 (20.03) (13.60)

HV 7: Start-Up power - - - - - -

GRAND TOTAL HT + LT 15,278.00 9,419.00 14,102.73 8,271.36 (1,176.27) (1,149.64)

GRAND TOTAL HT + LT as per

R-15 (Including ED, Cess, Meter

Rent, Surcharge, Misc Charges

etc)

14,102.73 -

GRAND TOTAL HT + LT as per

Audited Accounts

9,419.00 7,060.16

(1,086.12)

Subsidy as per audited Accounts 1,272.72

Total Revenue from Sales of

power including subsidy 9,419.00

8,332.88

(1,086.12)

13.1.2 The Actual income from sale of power indicated in the audited accounts including

subsidy is Rs 8332.88 Cr.



13.1.3 The Licensee thus prays to the Hon’ble Commission to consider Rs. 8332.88 Cr. as

Income from sales of power as per the audited accounts of the company, for the

purpose of deciding of True-up.


13.2.1 The Licensee hereby submits that the Hon’ble Commission had considered sales of

16,021 MU for the period FY 2017-18. However, the actual sales were13,276.41MU,

which are lower by 2743 MU than what has been approved in the Tariff order for FY

2017-18. The revenue from sales has also been lower by Rs. 1626 Cr. The details are

shown in the table below:

Table 39: Revenue from Sales for Central Discom FY 2017-18

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 12,032.00 7,314.00 9,908.62 6,195.13 (2,123.38) (1,118.87)

LV 1: Domestic 4,005.00 2,487.00 3,790.38 2,343.84 (214.62) (143.16)

LV 2: Non-Domestic 970.00 829.00 885.26 761.61 (84.74) (67.39)

LV 3: Public Water Works &

Street Lights 361.00 210.00 345.78 211.58 (15.22) 1.58

LV 4: LT Industry 283.00 221.00 273.43 233.62 (9.57) 12.62

LV 5: Irrigation pump for

Agriculture 6,413.00 3,567.00 4,613.77 2,644.47 (1,799.23) (922.53)

HIGH TENSION 3,988.00 2,966.00 3,367.80 2,320.86 (620.20) (645.14)

HV 1: Railway Traction - - - - - -

HV 2: Coal Mines 44.00 37.00 26.21 24.48 (17.79) (12.52)

HV-3: Industrial & Non-Industrial 3,513.00 2,669.00 2,976.47 2,071.58 (536.53) (597.42)

HV-4: Seasonal 2.00 1.00 1.60 1.56 (0.40) 0.56

HV-5: HT Irrigation & Water

Works 255.00 149.00 207.42 123.87 (47.58) (25.13)

HV 6: Bulk Residential Users 174.00 110.00 146.64 93.81 (27.36) (16.19)

HV 7: Start-Up power - - 9.45 5.56 9.45 5.56

GRAND TOTAL HT + LT 16,020.00 10,280.00 13,276.41 8,515.99 (2,743.59) (1,764.01)

GRAND TOTAL HT + LT as

per R-15 (Including ED, Cess,

Meter Rent, Surcharge, Misc

Charges etc)

13,276.41 -

GRAND TOTAL HT + LT as

per Audited Accounts 10,280.00 6,787.28

Subsidy as per audited Accounts

2,258.93

Less: Electricity Duty

451.13

Total Sales of power including

subsidy

10,280.00

8,595.08

(1,684.92)



13.2.2 The actual income as per the audited accounts including subsidy is Rs. 8,595.08 Cr.

Accordingly the Licensee prays the Hon’ble Commission to consider Rs. 8,595.08 Cr

as Income from sales of power for the purpose of deciding of True up.


13.3.1 The Licensee hereby submits that the Hon’ble Commission approved total sales of

18,426 MU’s. Actual sales during FY 2017-18 was 17565 MU which is lower by 227

MU than approved in the tariff order for FY 2017-18.

13.3.2 The actual revenue as per audited accounts is Rs. 11,837.85 Cr. Details of the same

are as shown in the table below:

Table 40: Revenue from Sales for West Discom FY 2017-18

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

7,519.88

LV 1: Domestic 3,661 2,141 3,840 (179.02)

LV 2: Non-domestic/Commercial 1,029 882 1,038 (8.54)

LV 3: Public Water Works and Street

Lights 455 272 436 18.90

LV 4: LT Industry 591 455 586 4.67

LV 5: Irrigation Pump for

Agriculture 8,545 4,585 8,357 188.01

LT TOTAL 14,281 8,335.00 14,256.98 24.02

HIGH TENSION

HV 1: Railway Traction 0 0 0.00 0.00

HV 2: Coal Mines 0 0 0.00 0.00

HV 3: Industrial and Non-Industrial 3,565 2,683 3,731.74 (166.74)

HV-4: Seasonal 12 9 12.16 (0.16)

HV-5: HT Irrigation & Water Works 536 316 577.06 (41.06)

HV 6: Bulk Residential Users 31 20 12.24 18.76

HV 7: Bulk Supply to Exemptees

(RE Co-op society) 1 1 31.04 (30.04)

HT TOTAL 4,145 3,028.80 4,364.25 - (219.25)

GRAND TOTAL HT + LT 18,426 11,363.80 18,621.23 7,519.88 (195.23) 3,843.92

GRAND TOTAL Revenue from

Sale of Power as per Audited

Accounts

7,519.88

Net of subsidy

4,317.97

Revenue From Sale Of Power As

Per Audited Accounts (Including

Subsidy and excluding revenue

from sale of services)

11,837.85



T14: SUMMARY OF TRUE UP ARR FOR FY 2017-18

14.1 East Discom submits that in accordance with the normative parameters of MPERC,

the gross ARR of East Discom for the period FY 2017-18 is Rs 10,024.83 Cr, which

is Rs 1,157.01 Cr higher than the approved ARR in the Tariff Order for the period FY

2017-18.The income from sale of power including the subsidy was Rs. 8,332.88 Cr

which is lesser by Rs 1,086.57 Cr and other income was Rs. 316.77 Cr which is

higher by Rs. 73.37 Cr as assessed in Tariff order 2017-18. Thus, the total gap works

out as Rs 2,215.58 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 2017-18 is Rs 10,686.83 Cr,

which is Rs 949.58 Cr higher than the approved ARR in the Tariff Order for the

period FY 2017-18. The income from sale of power including the subsidy was Rs.

8,595.08 Cr which is lesser by Rs 1,683.68 Cr and other income was Rs. 342.26Cr

which is higher by Rs. 73.69 Cr as assessed in Tariff order 2017-18. Thus, the total

gap works out as Rs 2,613.58 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 2017-18 is Rs 11,792.57 Cr, which

is Rs 718.38 Cr higher than the approved ARR in the Tariff Order for the period FY

2017-18. The income from sale of power including the subsidy was Rs. 11,837.85 Cr

which is higher by Rs 474.05 Cr and other income was Rs. 144.32 Cr which is lesser

by Rs. 205.05 Cr. as assessed in Tariff order 2017-18. Thus, the total gap works out as

Rs 498.38Cr.

14.4 Summary of the petitioner’s claim towards true up for the period FY 2017-18 is as

follows:

Table 41: Summary of True Up Claimed for FY 2017-18 (Rs Cr)

Sr.

no.

Particulars Discom Approved

in Tariff

Order

Claimed in

True up

Petition

Variation

1 Power Purchase Cost Including

MPPMCL Cost

EZ 6,937.73 8,001.86 (1,064.13)

CZ 7648.31 8,570.05 (921.74)

WZ 9,262.40 9,970.19 (707.79)

MP State 23,848.44 26,542.10 (2,693.66)

2 Employee Cost (including terminal

benefit cash outflow)

EZ 1,037.28 822.48 214.80

CZ 997.17 1,127.85 (130.68)

WZ 1,067.45 731.24 336.21

MP State 3,101.90 2,681.57 420.33



Sr.

no.


in Tariff

Order

Claimed in

True up

Petition

Variation

3 A&G Cost

EZ 179.50 218.90 (39.40)

CZ 103.50 133.55 (30.05)

WZ 138.50 152.73 (14.23)

MP State 421.50 505.18 (83.68)

4 R&M Cost

EZ 151.40 168.84 (17.44)

CZ 183.94 145.58 38.36

WZ 135.14 136.32 (1.18)

MP State 470.49 450.74 19.75

5 Depreciation

EZ 116.50 335.28 (218.78)

CZ 159.54 300.71 (141.17)

WZ 105.05 244.33 (139.28)

MP State 381.09 880.33 (499.24)


EZ 106.69 150.08 (43.39)

CZ 238.10 6.37 231.73

WZ 67.53 44.51 23.02

MP State 412.32 200.96 211.36


EZ 85.97 72.61 13.36

CZ 46.38 35.69 10.69

WZ 63.99 37.73 26.26

MP State 196.34 146.03 50.31

8 Interest on Consumer Security

Deposit

EZ 31.69 55.79 (24.10)

CZ 56.16 52.89 3.27

WZ 54.50 63.59 (9.09)

MP State 142.34 172.27 (29.93)

9 Return on Equity

EZ 219.05 307.16 (88.11)

CZ 302.14 318.61 (16.47)

WZ 177.63 174.41 3.22

MP State 698.82 800.17 (101.35)


EZ 2.00 14.75 (12.75)

CZ 2.00 23.28 (21.28)

WZ 2.00 237.00 (235.00)

MP State 6.00 275.03 (269.03)

11 Other Expenses

EZ

-

CZ

- -

WZ

0.52 (0.52)

MP State

0.52 (0.52)

12 Less: Expenses Capitalised EZ

(122.92) 122.92



Sr.

no.


in Tariff

Order

Claimed in

True up

Petition

Variation

CZ

(27.75) 27.75

WZ

-

MP State

(150.67) 150.67

13 Total Expenses

EZ 8,867.82 10,024.83 (1,157.01)

CZ 9,737.25 10,686.83 (949.58)

WZ 11,074.19 11,792.57 (718.38)

MP State 29,679.25 32,504.23 (2,824.98)

14 Less: Other Income - Retail &

Wheeling

EZ 243.40 316.77 (73.37)

CZ 268.57 342.26 (73.69)

WZ 349.37 144.32 205.05

MP State 861.34 803.35 57.99

16 Net Total Expenses for FY 2017-18

EZ 8,624.42 9,708.06 (1,083.64)

CZ 9,468.68 10,344.57 (875.89)

WZ 10,724.82 11,648.26 (923.44)

MP State 28,817.91 31,700.89 (2,882.98)


EZ 795.03 840.40 (45.37)

CZ 810.09 864.09 (54.00)

WZ 638.98 687.98 (49.00)

MP State 2,244.10 2,392.47 (148.37)


EZ 9,419.45 10,548.46 (1,129.01)

CZ 10,278.76 11,208.66 (929.90)

WZ 11,363.80 12,336.24 (972.44)

MP State 31,062.01 34,093.36 (3,031.35)

19 Revenue from sale of Power

EZ 9,419.45 8,332.88 1,086.57

CZ 10,278.76 8,595.08 1,683.68

WZ 11,363.80 11,837.85 (474.05)

MP State 31,062.01 28,765.81 2,296.20

20 Revenue Deficit/(Surplus)

EZ - 2,215.58 (2,215.58)

CZ - 2,613.58 (2,613.58)

WZ - 498.38 (498.38)

MP State - 5,327.54 (5,327.54)

14.5 The petitioners hereby submit that the total revenue gap works out to be Rs 2,215.58

Cr, Rs 2,613.58 Cr, Rs 498.38 Cr and Rs 5,327.54 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.

Documents

FOR FY 2017-18 Petition for FY-2017-18 filed by MPPMCL - Sta… · the 'Petitioner', MPPKVVCL, 'the Company' or 'the Licensee' or ‘East Discom’), is a Company incorporated under