Order Case No 9 of 2013

Before the

MAHARASHTRA ELECTRICITY REGULATORY COMMISSION

World Trade Centre, Centre No.1, 13th

Floor, Cuffe Parade, Mumbai- 400005.

Tel. 022 22163964/65/69 Fax 22163976

Email: [email protected]

Website: www.mercindia.org.in/www.merc.gov.in

Case No. 9 of 2013

IN THE MATTER OF

Petition filed by Reliance Infrastructure Limited – Distribution (RInfra-D) seeking

approval of Aggregate Revenue Requirement (ARR) and determination of Multi Year

Tariff for Second Control Period (FY 2012-13 to FY 2015-16)

Shri V.P. Raja, Chairman

Shri Vijay L. Sonavane, Member

Reliance Infrastructure Limited (RInfra),

H Block, 1st Floor,

Dhirubhai Ambani Knowledge City,

Navi Mumbai- 400 710 ….. Petitioner

ORDER

Date: 22 August, 2013

In accordance with Regulation 7.1 and Regulation 8 of the Maharashtra Electricity Regulatory

Commission (Multi Year Tariff) Regulations, 2011(hereinafter referred to as “ MERC MYT

Regulations, 2011” or “MYT Regulations”) and upon the directions from the Maharashtra

Electricity Regulatory Commission (hereinafter referred to as “the Commission”) in its Order in

Case No. 158 of 2011 dated 23 November, 2012 (Order on RInfra-D’s Business Plan for the

second Control Period from FY 2011-12 to FY 2015-16), Reliance Infrastructure Limited –

Distribution (hereinafter referred to as “RInfra-D” or “the Petitioner”), submitted its Petition

mailto:[email protected]

http://www.mercindia.org.in/www.merc.gov.in

Case No.9 of 2013 MERC Order for RInfra-D for MYT for Second Control Period

Page 2 of 302

dated 29 January, 2013 for approval of Aggregate Revenue Requirement (ARR) and

determination of Multi Year Tariff for Second Control Period from FY 2012-13 to FY 2015-16.

The Commission, in exercise of the powers vested in it under Section 86, Section 62 (read with

Section 61) of the Electricity Act, 2003 (hereinafter referred to as the Act or the EA, 2003) and

all other powers enabling it in this behalf, and after taking into consideration all the submissions

made by RInfra-D, issues raised during the Public Hearing and all other relevant material, issues

the following Order:


Page 3 of 302

TABLE OF CONTENTS

1. BACKGROUND AND SALIENT FEATURES OF THE ORDER --------------------------------------------- 13

1.1 Background ---------------------------------------------------------------------------------------------------------------- 13

1.2 Technical Validation Session (TVS) ----------------------------------------------------------------------------------- 15

1.3 Admission of the Petition and Public Process ----------------------------------------------------------------------- 16

1.4 Organisation of the Order ----------------------------------------------------------------------------------------------- 17

2. OBJECTIONS, RINFRA-D’S RESPONSE AND COMMISSION’S RULINGS ---------------------------- 18

2.1 Tariff related suggestions ------------------------------------------------------------------------------------------------ 18

2.2 Sales ------------------------------------------------------------------------------------------------------------------------- 23

2.3 Distribution Loss ---------------------------------------------------------------------------------------------------------- 25

2.4 Power Purchase Expenses ----------------------------------------------------------------------------------------------- 27

2.5 Operation and Maintenance (O&M) Expenses --------------------------------------------------------------------- 34

2.6 Capital Expenditure and Capitalisation ------------------------------------------------------------------------------ 35

2.7 Depreciation ---------------------------------------------------------------------------------------------------------------- 36

2.8 Procedural Issue----------------------------------------------------------------------------------------------------------- 37

2.9 Energy Charges ----------------------------------------------------------------------------------------------------------- 38

2.10 Wheeling Charges ----------------------------------------------------------------------------------------------------- 38

2.11 Cross Subsidy Surcharge -------------------------------------------------------------------------------------------- 40

2.12 Regulatory Asset and its Recovery Mechanism ----------------------------------------------------------------- 42

2.13 Distribution License related issues --------------------------------------------------------------------------------- 44

3. DETERMINATION OF THE ARR FOR THE CONTROL PERIOD FROM FY 2012-13 TO FY 2015-

16-------------------------------------------------------------------------------------------------------------------------------46

3.1 Sales forecast --------------------------------------------------------------------------------------------------------------- 46

3.1.1 Approach ----------------------------------------------------------------------------------------------------------------- 46

3.1.2 Estimation of Total Sales ---------------------------------------------------------------------------------------------- 46

3.1.3 Estimation of Changeover Sales -------------------------------------------------------------------------------------- 49

3.1.4 Estimation of RInfra-D Own Sales ----------------------------------------------------------------------------------- 52


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3.1.5 Demand Side Management (DSM) Measures ---------------------------------------------------------------------- 54

3.1.6 Commission’s Rulings ------------------------------------------------------------------------------------------------- 56

3.2 Distribution Losses ------------------------------------------------------------------------------------------------------- 58

3.2.1 Distribution Losses for period from FY 2012-13 to FY 2015-16 ----------------------------------------------- 58


3.3 Energy Balance and Power Purchase Requirement ---------------------------------------------------------------- 61

3.3.1 Energy Balance from FY 2012-13 to FY 2015-16 ---------------------------------------------------------------- 61


3.4 Power Procurement Plan and Expenses ------------------------------------------------------------------------------ 64

3.4.1 Estimation of Base and Peak Load ----------------------------------------------------------------------------------- 65

3.4.2 Procurement from Dahanu TPS (DTPS) ---------------------------------------------------------------------------- 67

3.4.3 Procurement from Medium term Contracts (upto FY 2013-14) ------------------------------------------------- 69

3.4.4 Procurement from Vidarbha Industries Power Limited (VIPL) ------------------------------------------------- 73

3.4.5 Procurement from Renewable Sources ------------------------------------------------------------------------------ 78

3.4.6 Short Term bilateral Power Purchases ------------------------------------------------------------------------------- 87

3.5 Transmission Charges --------------------------------------------------------------------------------------------------- 92

3.6 Stand-by Charges --------------------------------------------------------------------------------------------------------- 93

3.7 SLDC Charges ------------------------------------------------------------------------------------------------------------- 95

3.8 Capital Expenditure and Capitalisation ------------------------------------------------------------------------------ 97

3.8.1 Capital Expenditure submitted by RInfra-D ------------------------------------------------------------------------ 97

3.8.2 Capitalisation Plan submitted by RInfra-D ----------------------------------------------------------------------- 101

3.8.3 Commission’s Rulings ----------------------------------------------------------------------------------------------- 103

3.9 Depreciation --------------------------------------------------------------------------------------------------------------- 106

3.9.1 Depreciation submitted by RInfra-D ------------------------------------------------------------------------------- 106


3.10 Interest on Long Term Loan Capital ----------------------------------------------------------------------------- 113

3.10.1 Interest on Long Term Loan Capital submitted by RInfra-D ---------------------------------------------- 113

3.10.2 Commission’s Rulings -------------------------------------------------------------------------------------------- 120

3.11 Return on Equity ----------------------------------------------------------------------------------------------------- 124

3.11.1 Return on Equity submitted by RInfra-D ---------------------------------------------------------------------- 124


3.12 Operations and Maintenance Expenditure ---------------------------------------------------------------------- 129

3.12.1 Operations and Maintenance Expenditure -------------------------------------------------------------------- 129

3.12.2 Employee Expenses ----------------------------------------------------------------------------------------------- 133

3.12.3 Administrative and General Expenditure ---------------------------------------------------------------------- 134

3.12.4 Repairs and Maintenance Expenditure ------------------------------------------------------------------------- 134


3.13 Interest on Working Capital and Security Deposits ----------------------------------------------------------- 139


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3.13.1 RInfra-D’s Submission ------------------------------------------------------------------------------------------- 139


3.14 Income Tax ------------------------------------------------------------------------------------------------------------ 142

3.14.1 RInfra-D’s Submissions ------------------------------------------------------------------------------------------ 142


3.15 Contribution to Contingency Reserves --------------------------------------------------------------------------- 144



3.16 Non-Tariff Income --------------------------------------------------------------------------------------------------- 145



3.17 Income from Other Businesses ------------------------------------------------------------------------------------ 148



3.18 Past Recovery of TPC-G -------------------------------------------------------------------------------------------- 153

3.19 Wire Availability and Supply Availability ---------------------------------------------------------------------- 153

3.19.1 Wire Availability -------------------------------------------------------------------------------------------------- 153

3.19.2 Supply Availability------------------------------------------------------------------------------------------------ 155

3.20 Aggregate Revenue Requirement --------------------------------------------------------------------------------- 156

4. RECOVERY OF REGULATORY ASSET ------------------------------------------------------------------------- 161

4.1 Quantification of Regulatory Asset till FY 2011-12 --------------------------------------------------------------- 161

4.2 Commission’s Rulings --------------------------------------------------------------------------------------------------- 163

4.3 Regulatory Asset Recovery Mechanism ----------------------------------------------------------------------------- 164

4.3.1 Proposed Recovery Mechanism ------------------------------------------------------------------------------------ 164


5. TARIFF PHILOSOPHY ----------------------------------------------------------------------------------------------- 173

5.1 Wheeling Charges and Wheeling Losses ---------------------------------------------------------------------------- 173

5.1.1 RInfra-D submission on Wheeling Charges ---------------------------------------------------------------------- 173


5.2 Cross Subsidy Surcharge ----------------------------------------------------------------------------------------------- 175

5.2.1 RInfra-D’s Submissions ---------------------------------------------------------------------------------------------- 175


5.3 Revenue Gap and Revenue requirement from retail tariff ------------------------------------------------------ 185

5.3.1 Revenue Gap at existing tariff -------------------------------------------------------------------------------------- 185


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5.3.3 Revenue requirement to be recovered from Revised Tariffs --------------------------------------------------- 186


5.4 Tariff Philosophy --------------------------------------------------------------------------------------------------------- 188

5.5 Commission’s Tariff Philosophy -------------------------------------------------------------------------------------- 198

5.5.1 Tariff Design ----------------------------------------------------------------------------------------------------------- 198

5.5.2 Ceiling Tariff ---------------------------------------------------------------------------------------------------------- 200

5.5.3 Rationalisation of Tariff Categories/Consumption Slabs ------------------------------------------------------- 203

5.5.4 Fuel Adjustment Charges -------------------------------------------------------------------------------------------- 207

5.5.5 Cross-Subsidy Reduction Trajectory ------------------------------------------------------------------------------ 209

5.6 REVISED TARIFFS WITH EFFECT FROM 1 September, 2013 (for FY 2013-14) ----------------------- 212

5.7 REVISED TARIFFS WITH EFFECT FROM 1 APRIL, 2014 (for FY 2014-15) --------------------------- 216

5.8 REVISED TARIFFS WITH EFFECT FROM 1 APRIL, 2015 (for FY 2015-16) --------------------------- 219

5.9 INCENTIVES AND DISINCENTIVES ----------------------------------------------------------------------------- 222

5.9.1 Power Factor Incentive (Applicable for all HT categories, and LT II (B), LT II (C), and LT IV

categories) ------------------------------------------------------------------------------------------------------------------------- 222

5.9.2 Power Factor Penalty (Applicable for all HT categories, and LT II (B), LT II (C), and LT IV categories)

222

5.9.3 Prompt Payment Discount ------------------------------------------------------------------------------------------- 223

5.9.4 Delayed Payment Charges (DPC) ---------------------------------------------------------------------------------- 224

5.9.5 Rate of Interest on Arrears ------------------------------------------------------------------------------------------- 224

5.9.6 Load Factor Incentive ------------------------------------------------------------------------------------------------ 224

5.10 APPLICABILITY OF THE ORDER ---------------------------------------------------------------------------- 225


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List of Tables

TABLE 1: TOTAL SALES CAGR - CATEGORY WISE TOTAL SALES (%) AS SUBMITTED BY RINFRA-D ........................... 47

TABLE 2: TOTAL SALES AS PROJECTED BY RINFRA-D OF CONSUMER CONNECTED TO ITS DISTRIBUTION SYSTEM (MU)

........................................................................................................................................................................... 48

TABLE 3: ADDITIONAL CHANGEOVER OVER CONSUMERS AS SUBMITTED BY RINFRA-D ............................................. 50

TABLE 4: CHANGEOVER SALES AS PROJECTED BY RINFRA-D (MU) ............................................................................ 51

TABLE 5: OWN SALES AS PROJECTED BY RINFRA-D (WITHOUT CONSIDERING IMPACT OF DSM) (MUS) ..................... 53

TABLE 6: ENERGY SAVINGS (MU) THOUGH DSM ACTIVITIES AS SUBMITTED BY RINFRA-D ....................................... 54

TABLE 7: OWN SALES AS PROJECTED BY RINFRA-D (CONSIDERING IMPACT OF DSM) (MUS) ..................................... 55

TABLE 8: OWN SALES APPROVED BY THE COMMISSION (CONSIDERING IMPACT OF DSM) (IN MUS) ........................... 56

TABLE 9: CHANGEOVER SALES APPROVED BY THE COMMISSION IN CASE 179 OF 2011 (IN MU) ................................. 58

TABLE 10: ACTUAL DISTRIBUTION LOSS OF FY12 AS SUBMITTED BY RINFRA-D ........................................................ 59

TABLE 11: DISTRIBUTION LOSS TRAJECTORY AS SUBMITTED BY RINFRA-D FOR THE 2ND

CONTROL PERIOD ............... 60

TABLE 12: DISTRIBUTION LOSS REDUCTION TRAJECTORY APPROVED BY THE COMMISSION IN CASE NO. 158 OF 201160

TABLE 13: DISTRIBUTION LOSS TRAJECTORY APPROVED BY THE COMMISSION FOR THE 2ND

CONTROL PERIOD .......... 61

TABLE 14: IMPACT OF APPEAL NO. 160 OF 2012 AS SUBMITTED BY RINFRA-D (IN RS. CR) ......................................... 61

TABLE 15: ENERGY BALANCE FOR SECOND CONTROL PERIOD (MU) AS SUBMITTED BY RINFRA-D ............................ 62

TABLE 16: POWER PURCHASE REQUIREMENT FOR SECOND CONTROL PERIOD (MU) AS SUBMITTED BY RINFRA-D..... 62

TABLE 17: INSTS TRANSMISSION LOSSES AS PER MSLDC WEBSITE (%) .................................................................... 63

TABLE 18: ENERGY BALANCE APPROVED BY THE COMMISSION (MU) ......................................................................... 64

TABLE 19: ENERGY REQUIREMENT APPROVED BY THE COMMISSION (MU) ................................................................. 64

TABLE 20: BASE AND PEAK LOAD ESTIMATION AND ADDITIONAL CAPACITY REQUIREMENT FOR ................................ 66

TABLE 21: ENERGY AVAILABILITY FROM DTPS AS SUBMITTED BY RINFRA-D ............................................................ 68

TABLE 22: COST OF POWER PURCHASE FROM DTPS AS SUBMITTED BY RINFRA-D ..................................................... 68

TABLE 23 POWER PURCHASE FROM RINFRA-G FOR FY 2012-13 TO FY 2015-16 ........................................................ 69

TABLE 24: ENERGY AVAILABILITY FROM EXISTING MEDIUM TERM CONTRACTS (MU) AS SUBMITTED BY RINFRA-D 70

TABLE 25: TARIFF RATES FOR MEDIUM TERM CONTRACTS AS SUBMITTED BY RINFRA-D ........................................... 72

TABLE 26: COST OF POWER PROCUREMENT FROM MEDIUM TERM CONTRACTS (RS. CRORE) AS SUBMITTED BY

RINFRA-D ........................................................................................................................................................... 72

TABLE 27 POWER PURCHASE COST AS APPROVED FOR WPCL, ABHIJEET AND VIPL ................................................... 73

TABLE 28: POWER PURCHASE QUANTUM FROM VIPL FOR FY 15 & FY 16 AS SUBMITTED BY RINFRA-D .................... 75

TABLE 29: POWER PROCUREMENT COST FROM VIPL FOR FY 15 & FY 16 AS SUBMITTED BY RINFRA-D ....... 75

TABLE 30 POWER PURCHASE FROM VIPL FOR FY 2014-15 TO FY 2015-16 ................................................................ 78

TABLE 31: SOLAR RPO REQUIREMENT AS SUBMITTED BY RINFRA-D .......................................................................... 79

TABLE 32: CUMULATIVE SHORTFALL IN SOLAR RPO IN FY 11 AND FY 12 AS SUBMITTED BY RINFRA-D ..... 80

TABLE 33: ACTUAL MONTH-WISE GENERATION FROM DSSPL AS SUBMITTED BY RINFRA-D ...................................... 81

TABLE 34: SOLAR POWER COST SUMMARY AS SUBMITTED BY RINFRA-D FOR THE SECOND CONTROL PERIOD .......... 81

TABLE 35: NON SOLAR OBLIGATION AS SUBMITTED BY RINFRA-D (MU) ................................................................... 82

TABLE 36: EXISTING NON SOLAR CONTRACTS AS SUBMITTED BY RINFRA-D (MU) .................................................... 82

TABLE 37: POWER PURCHASE RATE WITH EXISTING NON SOLAR CONTRACTS AS SUBMITTED BY RINFRA-D

(RS/KWH) ........................................................................................................................................................... 82

TABLE 38: QUANTUM AND COST OF NON- SOLAR REC PROCUREMENT AS SUBMITTED BY RINFRA-D ........................ 83

TABLE 39: DISCOUNT CLAUSE BY VARIOUS RES GENERATORS AS SUBMITTED BY RINFRA-D ..................................... 83

TABLE 40 SOLAR POWER PURCHASE APPROVED BY THE COMMISSION FOR THE SECOND CONTROL PERIOD ............... 85

TABLE 41 NON-SOLAR POWER PURCHASE AS APPROVED BY THE COMMISSION ............................................................ 85

TABLE 42 PURCHASE OF NON-SOLAR RECS APPROVED BY THE COMMISSION FOR FY 2012-13 TO FY 2015-16 ......... 87


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TABLE 43: ANNUAL HOUR WISE DEFICIT AND SURPLUS AS SUBMITTED BY RINFRA-D (MU) ...................................... 87

TABLE 44: QUANTUM AND RATE OF SHORT TERM POWER PROCUREMENT AS PROJECTED BY RINFRA-D .................... 89

TABLE 45: QUANTUM AND RATE OF SURPLUS POWER SALE PROJECTED BY RINFRA-D ............................................... 90

TABLE 46 ACTUAL SHORT-TERM POWER PURCHASE DURING FY 2011-12 ................................................................... 90

TABLE 47 PURCHASE FROM SHORT-TERM SOURCES BY RINFRA-D (MU) ..................................................................... 91

TABLE 48 SHORT-TERM POWER PURCHASE APPROVED BY THE COMMISSION ............................................................... 91

TABLE 49 SALE OF SURPLUS POWER AS APPROVED BY THE COMMISSION FOR RINFRA-D ............................................ 92

TABLE 50: TRANSMISSION CHARGES FOR THE SECOND CONTROL PERIOD AS SUBMITTED BY RINFRA-D (RS. CR) ...... 92

TABLE 51 TRANSMISSION CHARGES PAYABLE BY RINFRA-D AS APPROVED BY THE COMMISSION .............................. 93

TABLE 52: STANDBY CHARGES FOR THE SECOND CONTROL PERIOD AS SUBMITTED BY RINFRA-D (RS. CR)

........................................................................................................................................................................... 94

TABLE 53 STANDBY CHARGES AS APPROVED BY THE COMMISSION FOR RINFRA-D..................................................... 94

TABLE 54: SLDC CHARGES FOR THE SECOND CONTROL PERIOD AS SUBMITTED BY RINFRA-D (RS. CR) .... 95

TABLE 55: SLDC FEES AND CHARGES AS APPROVED BY THE COMMISSION FOR RINFRA-D ........................................ 95

TABLE 56: SUMMARY OF POWER PURCHASE REQUIREMENT AS SUBMITTED BY RINFRA-D (MU) ................................ 95

TABLE 57: SUMMARY OF POWER PURCHASE COST AS SUBMITTED BY RINFRA-D (RS. CR) ......................................... 96

TABLE 58: SUMMARY OF POWER PURCHASE REQUIREMENT AS APPROVED BY THE COMMISSION (MU) ...................... 96

TABLE 59: SUMMARY OF POWER PURCHASE COST AS APPROVED BY THE COMMISSION (RS. CRORE) ......................... 97

TABLE 60: CAPEX-RETAIL SUPPLY BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) ............................................... 100

TABLE 61: CAPEX-WIRES BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR).............................................................. 100

TABLE 62: SUMMARY OF CAPEX (WIRE & RETAIL) AS SUBMITTED BY RINFRA-D (RS. CR.)...................................... 101

TABLE 63: CAPITALISATION PLAN FOR RETAIL SUPPLY BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) ................ 101

TABLE 64: CAPITALISATION PLAN FOR WIRES BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) .............................. 102

TABLE 65: SUMMARY OF CAPITALISATION (WIRE & RETAIL) AS SUBMITTED BY RINFRA-D (RS. CR.) ...................... 102

TABLE 66: COMPARISON OF CAPITALISATION AS APPROVED BY THE COMMISSION IN BUSINESS PLAN AND AS

SUBMITTED BY RINFRA-D IN MYT PETITION (RS. CR) ..................................................................................... 103

TABLE 67: CAPITALISATION PLAN FOR WIRE BUSINESS AS APPROVED BY THE COMMISSION (RS. CR) ...................... 104

TABLE 68: CAPITALISATION PLAN FOR RETAIL SUPPLY BUSINESS AS APPROVED BY THE COMMISSION (RS. CR) ...... 104

TABLE 69: VARIATION IN CAPITALISATION AS APPROVED BY THE COMMISSION IN BUSINESS PLAN ORDER AND AS

SUBMITTED BY RINFRA-D (RS. CR) .................................................................................................................. 105

TABLE 70: ADDITIONAL SCHEMES APPROVED POST ISSUANCE OF BUSINESS PLAN ORDER AND PRE SUBMISSION OF

MYT PETITION (RS. CR) ................................................................................................................................... 106

TABLE 71: DEPRECIATION RATES AS SUBMITTED BY RINFRA-D (AFTER CROSSING 70% THRESHOLD) ....................... 107

TABLE 72: DEPRECIATION FOR RETAIL SUPPLY BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) ............................. 110

TABLE 73: DEPRECIATION FOR WIRE BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) ............................................. 110

TABLE 74: COMPARISON OF DEPRECIATION AS APPROVED BY THE COMMISSION IN BUSINESS PLAN AND AS SUBMITTED

BY RINFRA-D IN MYT PETITION (RS. CR) ........................................................................................................ 111

TABLE 75: DEPRECIATION FOR WIRES BUSINESS AS APPROVED BY THE COMMISSION (RS. CR) ................................. 112

TABLE 76: DEPRECIATION FOR RETAIL SUPPLY BUSINESS AS APPROVED BY THE COMMISSION (RS. CR) ................... 113

TABLE 77: TOTAL DEPRECIATION AS APPROVED BY THE COMMISSION FOR THE SECOND CONTROL PERIOD (RS. CR)

......................................................................................................................................................................... 113

TABLE 78: LOAN SCHEDULE AS SUBMITTED BY RINFRA-D (RS. CR) .......................................................................... 115

TABLE 79: SUMMARY OF INTEREST EXPENSES FOR EXISTING LOANS FOR RETAIL SUPPLY BUSINESS AS SUBMITTED BY

RINFRA-D (RS. CR) .......................................................................................................................................... 117

TABLE 80: SUMMARY OF INTEREST EXPENSES FOR EXISTING LOANS FOR WIRES BUSINESS AS SUBMITTED BY RINFRA-

D (RS. CR) ........................................................................................................................................................ 117

TABLE 81: SUMMARY OF INTEREST EXPENSES FOR NEW LOANS FOR WIRES BUSINESS AS SUBMITTED BY RINFRA-D

(RS. CR) ............................................................................................................................................................ 118


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TABLE 82: SUMMARY OF INTEREST EXPENSES FOR NEW LOANS FOR RETAIL SUPPLY BUSINESS AS SUBMITTED BY

RINFRA-D (RS. CR) .......................................................................................................................................... 118

TABLE 83: SUMMARY OF TOTAL INTEREST EXPENSES FOR WIRES & RETAIL BUSINESS AS SUBMITTED BY RINFRA-D

(RS. CR) ............................................................................................................................................................ 119

TABLE 84: COMPARISON OF INTEREST EXPENSES AS APPROVED BY THE COMMISSION IN BUSINESS PLAN ORDER AND

AS SUBMITTED BY RINFRA-D IN MYT PETITION (RS. CR) ................................................................................ 119

TABLE 85: WEIGHTED AVERAGE INTEREST RATE OF RINFRA AS COMPUTED BY THE COMMISSION ............................ 123

TABLE 86: INTEREST EXPENSES ON LONG TERMS LOANS FOR THE MYT PERIOD AS APPROVED BY THE COMMISSION

(IN RS. CRORE) ................................................................................................................................................. 123

TABLE 87: RETURN ON EQUITY FOR WIRES BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) .................................. 125

TABLE 88: RETURN ON EQUITY FOR RETAIL SUPPLY BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) .................... 126

TABLE 89: RETURN ON EQUITY FOR WIRES AND RETAIL BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) . 126

TABLE 90: COMPARISON OF ROE AS APPROVED BY THE COMMISSION IN BUSINESS PLAN AND AS SUBMITTED BY

RINFRA-D IN MYT PETITION (RS. CR) ............................................................................................................. 127

TABLE 91: RETURN ON EQUITY AS APPROVED BY THE COMMISSION FOR THE SECOND CONTROL PERIOD OF THE MYT

PERIOD.............................................................................................................................................................. 128

TABLE 92: COMPARISON OF O&M EXPENSES AS SUBMITTED BY RINFRA-D .............................................................. 130

TABLE 93: SUMMARY OF EMPLOYEE EXPENSES AS SUBMITTED BY RINFRA-D (RS. CR) ............................................ 134

TABLE 94: SUMMARY OF A&G EXPENSES AS SUBMITTED BY RINFRA-D (RS. CR) .................................................... 134

TABLE 95: SUMMARY OF R&M EXPENSES AS SUBMITTED BY RINFRA-D (RS. CR) .................................................... 135

TABLE 96: SUMMARY OF INDICES USED BY RINFRA-D TO PROJECT O&M EXPENSES ................................................ 135

TABLE 97: O&M EXPENSES APPROVED BY THE COMMISSION (RS CRORE) ................................................................ 138

TABLE 98: INTEREST ON WORKING CAPITAL AND SECURITY DEPOSIT FOR WIRE & RETAIL SUPPLY BUSINESS AS

SUBMITTED BY RINFRA-D (RS. CRORE) ............................................................................................................ 139

TABLE 99: INTEREST ON WORKING CAPITAL FOR WIRE & RETAIL SUPPLY BUSINESS APPROVED BY THE COMMISSION

(RS. CRORE) ..................................................................................................................................................... 141

TABLE 100: INCOME TAX PROJECTIONS AS SUBMITTED BY RINFRA-D (RS. CR) ......................................................... 142

TABLE 101: INCOME TAX APPROVED BY THE COMMISSION (IN RS. CRORE) ............................................................... 143

TABLE 102: CONTRIBUTION TO CONTINGENCY RESERVES AS SUBMITTED BY RINFRA-D (WIRES, RS. CRORE) ......... 144

TABLE 103: CONTRIBUTION TO CONTINGENCY RESERVE AS SUBMITTED BY RINFRA-D (RETAIL, RS. CRORE) .......... 145

TABLE 104: CONTRIBUTION TO CONTINGENCY RESERVE APPROVED BY THE COMMISSION (RS. CRORE) .................. 145

TABLE 105: ACTUAL RECOVERY FROM THEFT OF POWER FOR FY 13 TILL JANUARY 2013 AS SUBMITTED BY RINFRA-D

......................................................................................................................................................................... 147

TABLE 106:NON-TARIFF INCOME AS SUBMITTED BY RINFRA-D FOR RETAIL SUPPLY (RS. CRORE) ............................ 147

TABLE 107: NON-TARIFF INCOME AS SUBMITTED BY RINFRA-D FOR WIRES BUSINESS (RS. CRORE) ........................ 147

TABLE 108:NON-TARIFF INCOME APPROVED BY THE COMMISSION FOR RETAIL SUPPLY (RS. CRORE) ....................... 148

TABLE 109: NON-TARIFF INCOME APPROVED BY THE COMMISSION FOR WIRES BUSINESS (RS. CRORE) ................... 148

TABLE 110: INCOME FROM DEVIDAS LANE OFFICE AS SUBMITTED BY RINFRA-D ...................................................... 149

TABLE 111: INCOME FROM OTHER BUSINESS AS SUBMITTED BY RINFRA-D (RS. CR) ................................................. 152

TABLE 112: INCOME FROM OTHER BUSINESS APPROVED BY THE COMMISSION (RS. CRORE) ...................................... 152

TABLE 113: AGGREGATE REVENUE REQUIREMENT SUBMITTED BY RINFRA-D- RETAIL SUPPLY BUSINESS (RS. CRORE)

......................................................................................................................................................................... 156

TABLE 114: AGGREGATE REVENUE REQUIREMENT SUBMITTED BY RINFRA-D- WIRES BUSINESS (RS. CRORE) ........ 157

TABLE 115: TOTAL AGGREGATE REVENUE REQUIREMENT SUBMITTED BY RINFRA-D- (RETAIL SUPPLY +WIRES)

BUSINESS (RS. CRORE) ..................................................................................................................................... 158

TABLE 116: AGGREGATE REVENUE REQUIREMENT APPROVED BY THE COMMISSION- RETAIL SUPPLY BUSINESS (RS.

CRORE) ............................................................................................................................................................. 158

TABLE 117: AGGREGATE REVENUE REQUIREMENT APPROVED BY THE COMMISSION- WIRES BUSINESS (RS. CRORE)

......................................................................................................................................................................... 159


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TABLE 118: TOTAL AGGREGATE REVENUE REQUIREMENT APPROVED BY THE COMMISSION- (RETAIL SUPPLY

+WIRES) BUSINESS (RS. CRORE) ...................................................................................................................... 160

TABLE 119: CUMULATIVE REVENUE GAP WITH CARRYING COST TILL FY 2011-12 AS SUBMITTED BY RINFRA-D (RS.

CRORE) ............................................................................................................................................................. 162

TABLE 120: CUMULATIVE REGULATORY ASSET WITH CARRYING COST TILL FY 2011-12 AS APPROVED BY THE

COMMISSION (RS. CRORE) ................................................................................................................................ 164

TABLE 121: BIFURCATION OF REGULATORY ASSET TO OWN AND CHANGEOVER CONSUMERS AS SUBMITTED BY

RINFRA-D ......................................................................................................................................................... 164

TABLE 122: REGULATORY ASSET RECOVERY FOR OWN CONSUMERS AS SUBMITTED BY RINFRA-D ......................... 165

TABLE 123: DETERMINATION OF REGULATORY ASSET CHARGE FOR CHANGEOVER SUBMITTED BY RINFRA-D ........ 166

TABLE 124: REGULATORY ASSET CHARGE APPROVED BY THE COMMISSION (RS CRORE) ......................................... 169

TABLE 125: REGULATORY ASSET CHARGE APPROVED BY THE COMMISSION (RS/KWH) ........................................... 170

TABLE 126: EXISTING WHEELING CHARGES AS SUBMITTED BY RINFRA-D ................................................................ 173

TABLE 127: WHEELING CHARGES AS PROPOSED BY RINFRA-D FOR THE REMAINING PART OF SECOND CONTROL

PERIOD.............................................................................................................................................................. 173

TABLE 128: WHEELING CHARGES APPROVED BY THE COMMISSION FOR SECOND CONTROL PERIOD (RS CRORE) ..... 174

TABLE 129: MARGINAL POWER PURCHASE COST PER UNIT FOR CSS CALCULATIONS AS SUBMITTED BY RINFRA-D (RS.

/KWH) ............................................................................................................................................................... 176

TABLE 130: SYSTEM LOSSES FOR CSS CALCULATIONS AS SUBMITTED BY RINFRA-D................................................ 177

TABLE 131: WHEELING CHARGES FOR CSS CALCULATIONS AS SUBMITTED BY RINFRA-D ........................................ 177

TABLE 132: CSS (RS. /KWH) FOR THE SECOND CONTROL PERIOD AS SUBMITTED BY RINFRA-D .............................. 177

TABLE 133: MARGINAL COST OF POWER PURCHASE BY RINFRA-D APPROVED BY THE COMMISSION (RS/KWH) ...... 180

TABLE 134: SYSTEM LOSSES FOR CSS CALCULATIONS APPROVED BY THE COMMISSION (%) .................................... 180

TABLE 135: WHEELING CHARGES FOR CSS CALCULATIONS AS APPROVED BY THE COMMISSION (RS/KWH) ............ 181

TABLE 136: APPROVED CSS FOR FY 2013-14(RS/KWH) ........................................................................................... 181

TABLE 137: APPROVED CSS FOR FY 2014-15(RS/KWH) ........................................................................................... 182

TABLE 138: APPROVED CSS FOR FY 2015-16 (RS/KWH) .......................................................................................... 183

TABLE 139: REVENUE GAP FOR FY 2012-13 AS SUBMITTED BY RINFRA-D (RS CRORE) ........................................... 185

TABLE 140: REVENUE GAP FOR FY 2012-13 APPROVED BY THE COMMISSION (RS CRORE) ....................................... 186

TABLE 141: NET REVENUE REQUIREMENT FOR THE SECOND CONTROL PERIOD FROM RINFRA-D CONSUMERS AS

SUBMITTED BY RINFRA-D (RS CRORE) ............................................................................................................. 186

TABLE 142: REVENUE GAP FOR THE SECOND CONTROL PERIOD AT EXISTING TARIFF APPROVED BY THE COMMISSION

(RS CRORE) ...................................................................................................................................................... 187

TABLE 143: NET REVENUE REQUIREMENT AND NORMALISED RECOVERY FOR THE SECOND CONTROL PERIOD AT

EXISTING TARIFF APPROVED BY THE COMMISSION (RS CRORE) ........................................................................ 188

TABLE 144: FIXED CHARGES AS SUBMITTED BY RINFRA-D (RS/ CONSUMER/ MONTH) ............................................. 189

TABLE 145: DEMAND CHARGES AS SUBMITTED BY RINFRA-D (RS/ KVA/ MONTH)................................................... 190


EXISTING TARIFF APPROVED BY THE COMMISSION EXCLUDING REGULATORY ASSET RECOVERY (RS CRORE) 198


EXISTING TARIFF APPROVED BY THE COMMISSION INCLUDING REGULATORY ASSET RECOVERY (RS CRORE) . 199


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List of Abbreviations

AAD Advance Against Depreciation

A&G Administrative and General

ABR Average Billing Rate

ACOS Average Cost of Supply

APR Annual Performance Review

ARR Aggregate Revenue Requirement

ATE Appellate Tribunal for Electricity

BPL Below Poverty Line

BPP Bilateral Power Purchase

BEST Brihanmumbai Electric Supply & Transport Undertaking

CAGR Compound Annual Growth Rate

Capex Capital Expenditure

CBA Cost Benefit Analysis

CERC Central Electricity Regulatory Commission

CGRF Consumer Grievance Redressal Forum

COD Date of Commissioning

CSR Corporate Social Responsibility

CSS Cross Subsidy Surcharge

CPI Consumer Price Index

DPC Delayed Payment Charge

DPR Detailed Project Report

DSM Demand Side Management

DSS Distribution Substation

EA, 2003 Electricity Act, 2003

FAC Fuel Adjustment Cost

FBSM Final Balancing and Settlement Mechanism

FY Financial Year

GoM Government of Maharashtra

GFA Gross Fixed Assets

G, T & D Generation, Transmission and Distribution

HT High Tension

IEGC Indian Electricity Grid Code

IoWC Interest on Working Capital

InSTS Intra State Transmission System

LMC Load Management Charges

LT Low Tension

kVA Kilo Volt Ampere

kW Kilo Watt

kWh Kilo Watt hour

LCC Load Control Centre


Page 12 of 302

MAT Minimum Alternate Tax

MCGM Municipal Corporation of Greater Mumbai

MERC Maharashtra Electricity Regulatory Commission

MIAL Mumbai International Airport Ltd.

MMOPL Mumbai Metro One Private Limited

MOD Merit Order Dispatch

MSEDCL Maharashtra State Electricity Distribution Company Ltd.

MSLDC Maharashtra State Load Despatch Centre

MU Million Units

MVA Mega-Volt Ampere

MW MegaWatt

MYT Multi Year Tariff

MERC Tariff

Regulations

MERC (Terms and Conditions of Tariff) Regulations, 2005

MERC MYT

Regulations, 2011

MERC (Multi Year Tariff) Regulations, 2011

OA Open Access

O&M Operation and Maintenance

R&M Repair and Maintenance

RE Renewable Energy

RAC Regulatory Asset Charge

REC Renewable Energy Certificate

RInfra Reliance Infrastructure Limited

RInfra-G Reliance Infrastructure Limited- Generation Business

RInfra-T Reliance Infrastructure Limited- Transmission Business

RInfra-D Reliance Infrastructure Limited- Distribution Business

RoE Return on Equity

RPO Renewable Purchase Obligation

RPO Regulations MERC (Renewable Purchase Obligation, its Compliance and implementation

of REC framework) Regulations, 2010

RPS Renewable Purchase Specification

SAIDI System Average Interruption Duration Index

SBAR State Bank of India Advance Rate

SBI PLR State Bank of India Prime Lending Rate

SLDC State Load Despatch Centre

TL Transmission Loss

TOD Time of Day

TVS Technical Validation Session

UI Unscheduled Interchange

WPI Wholesale Price Index

WL Wheeling Loss


Page 13 of 302

1. BACKGROUND AND SALIENT FEATURES OF THE ORDER

1.1 Background

1.1.1.1 Reliance Infrastructure Limited (RInfra) is an integrated Utility engaged in

Generation, Transmission and Distribution of electricity in and around suburban

areas of Mumbai. RInfra was granted a licence to distribute electricity by the

Commission for a period of 25 years with effect from August 16, 2011. Prior to this,

RInfra was a deemed Distribution Licensee having a licence to distribute electricity

in the suburbs of Mumbai, under the terms of the Electricity Act, 2003. The

distribution business of RInfra shall be, hereafter referred to as RInfra-D.

1.1.1.2 RInfra-D in this Petition submitted that it is currently catering to electricity needs of

approximately 2.8 million consumers in its licensed area (in and around suburbs of

Mumbai) spread over 400 Sq. kms with energy input requirement of more than 9

Billion Units per annum and coincident Maximum Demand in the range of 1650

MVA. As on 31 March, 2012, the distribution system of RInfra-D included 5775

Nos. of 11kV Substations, 4519 ckt-kms of HT cable and 4202 ckt-kms of LT cable.

1.1.1.3 The Commission, in exercise of the powers conferred by the EA, 2003, notified the

Maharashtra Electricity Regulatory Commission (Terms and Conditions of Tariff)

Regulations, 2005, (hereinafter referred as the "MERC Tariff Regulations") on

August 26, 2005. These Regulations superseded the MERC (Terms and Conditions

of Tariff) Regulations, 2004.

1.1.1.4 The Commission, in exercise of the powers conferred by the EA, 2003, notified the

Maharashtra Electricity Regulatory Commission (Multi Year Tariff) Regulations,

2011, (hereinafter referred as the MERC MYT Regulations, 2011) on 4 February,

2011. These Regulations are applicable for the second Control Period starting from

FY 2011-12 to FY 2015-16.

1.1.1.5 RInfra-D filed a Petition before the Commission on March 25, 2011, under Section

94 (2) of the Electricity Act, 2003 (EA, 2003), Regulation 85 (a) of the MERC

(Conduct of Business) Regulations, 2004, and Regulations 4.1, 99 and 100 of the

MERC Multi Year Tariff (MYT) Regulations, 2011, in Case No. 45 of 2011 seeking

deferment of the implementation of MYT Regulations, 2011.


Page 14 of 302

1.1.1.6 The Commission vide its Order dated September 2, 2011 in the said case, allowed

the exemption to RInfra-D from MERC (MYT) Regulations, 2011 for a period of 1

year, till March 31, 2012. The Commission also directed RInfra-D to file the

Petition for determination of tariff for FY2011-12 under Maharashtra Electricity

Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2005, on or

before October 31, 2011. The relevant extract from the Order is as under:

“In light of the above, the Commission is of the view that it has become

necessary to invoke the proviso to Regulation 4.1 of MYT Regulations,

2011 in order to exempt the determination of tariff of RInfra under the

Multi-Year Tariff framework till March 31, 2012 (i.e., for a period of 1

year). The said exemption is hereby granted. The Commission is also

empowered under Regulation 100 of the MYT Regulations, 2011 to

remove any difficulty arising in giving effect to the provisions of MYT

Regulations 2011. Accordingly, the Commission hereby directs RInfra to

file the Petition for determination of tariff for FY 2011-12 within 2 months

time, i.e., on or before October 31, 2011.”

1.1.1.7 The Commission amended the MYT Regulations vide its notification dated 21

October, 2011; notified as Maharashtra Electricity Regulatory Commission (Multi

Year Tariff) (First Amendment) Regulations, 2011. The Commission in this

amendment to the Regulations specified, as under:

“Provided in case an Order of exemption has been issued under

Regulation 4.1 then the concerned Generating Company, Transmission

Licencee or Distribution Licencee shall file annual Petitions for approval

of ARR and tariff during the period of exemption, in accordance with

MERC (Terms and Conditions of Tariff) Regulations, 2005.”

1.1.1.8 The Commission vide its Order in Case No. 158 of 2011 dated 23 November, 2012

directed RInfra-D as under:

“The Commission’s computations for the Business Plan of RInfra-D shall form

the basis for filing the MYT Petition for the second Control Period. RInfra-D shall

submit the MYT Petition within 60 days from the date of issuance of this Business

Plan Order...”


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1.1.1.9 In accordance with the above direction from the Commission and as per Regulation

8 of the MERC MYT Regulations, 2011 RInfra-D submitted its MYT Petition dated

29 January, 2013 registered by the Commission as Case No. 9 of 2013 for approval

of ARR and determination of Tariff from FY 2012-13 to FY 2015-16.

1.1.1.10 The prayers made by the Petitioner in Case No. 9 of 2013 are as under:

“

1. Approve the ARR forecast and Tariff & Charges for FY 2012-13 to FY

2015-16, as contained in this Petition;

2. Allow the revision in wheeling charges and Cross-Subsidy Surcharge, as

proposed in this petition for the period FY2012-13 to FY2015-16;

3. Approve the recovery of regulatory assets along with carrying cost, as

proposed in the petition;

4. Approve the deviations from the norms prescribed in the MYT

Regulations, as sought in this Petition.

5. Allow additions / alterations / modifications / changes to the Petition at a

future date;

6. Allow any other relief, order or direction, which the Hon'ble Commission

deems fit to be issued;

7. Condone any inadvertent errors/ inconsistencies/omissions/rounding of

differences, etc. as may be there in the Petition.

”

1.2 Technical Validation Session (TVS)

The Commission scrutinised the Petition of RInfra-D and directed RInfra-D to address data

gaps raised before the first Technical Validation Session (TVS) held on 8 February, 2013, in

the presence of authorised Consumer Representatives authorised under MERC (Authorised

Consumer Representative Regulations, 2012. The list of persons, who participated in the

TVS, held on 8 February, 2013 is provided at Appendix-1.

During the TVS, the Commission directed RInfra-D to provide additional information and

clarifications on the issues raised during the TVS and submit the revised Petition.

Subsequently, RInfra-D submitted its replies to the data gaps vide its submissions dated 11


Page 16 of 302

February 2013, 12 February 2013 and 16 February 2013. RInfra-D submitted its revised

Petition on 18 February, 2013, all required information for admission of the Petition.

1.3 Admission of the Petition and Public Process

The Commission admitted the Petition on 22 February, 2013 and vide its letter

MERC/Case No. 9 of 2013/2683 conveyed the same to RInfra-D and further

directed them to publish the approved Public Notice. In accordance with Section 64

of the Act, RInfra-D published Public Notices in two (2) English newspapers

(Hindustan Times and Indian Express) and two (2) Marathi newspapers (Loksatta

and Samana) dated 1 March, 2013 inviting suggestions and objections from

stakeholders on its Petition. Further, RInfra-D made available copies of its Petition

and executive summary (in both English and Marathi version) for inspection/

purchase by members of the public at RInfra-D's offices. RInfra-D's website

(www.rinfra.com) hosted the documents in downloadable format. The Petition, its

executive summary and copy of public notice were also hosted on the website of the

Commission (www.mercindia.org.in/ www.merc.gov.in) in downloadable format.

The Commission received written objections expressing concerns on several issues,

including tariff of RInfra-D, Power Purchase Expenses, Average cost of supply,

Wheeling and distribution losses, Recoveries against vigilance, Interest on long-

term loan capital, Recovery of regulatory asset, Consumer migration, etc. The

Commission held Public hearing on RInfra-D on 6 April, 2013 at Rang Sharda

Natya Mandir, Bandra Reclamation, Bandra (W), Mumbai- 400050. Consumer

representatives also participated actively in this process. The list of objectors, and

persons who participated in the public hearing, is provided in Appendix-2.

The Commission has ensured that the due process, contemplated under law, was

followed meticulously at every stage to ensure transparency and public

participation. Adequate opportunity was given to all the persons concerned to

submit their response in the matter.

Various objections that were raised on RInfra-D’s Petition after publication of the

notice both in writing as well as during the Public Hearing, along with RInfra-D’s

http://www.mercindia.org.in/


Page 17 of 302

response and the Commission’s rulings have been summarised in Section 2 of this

Order.

1.4 Organisation of the Order

A list of abbreviations with their expanded forms has been included at the beginning of this

Order. This Order is organised in the following Sections:

a) Section 1 of the Order provides a brief background of the process undertaken

by the Commission;

b) Section 2 of the Order summarises the various objections raised by the

objectors in writing as well as during the Public Hearing held. Each of the

objections is followed by the response of RInfra-D and ruling of the

Commission respectively;

c) Section 3 of the Order details the RInfra-D’s submission for Second Control

Period from FY 2012-13 to FY 2015-16 for ARR and Commission’s analysis;

d) Section 4 of the Order details the Regulatory Asset of RInfra-D and its

recovery mechanism;

e) Section 5 of the Order discusses the tariff philosophy and submission of

RInfra-D for Tariff determination and further Tariff determination by the

Commission for RInfra-D for the period from FY 2012-13 to FY 2015-16.


Page 18 of 302

2. OBJECTIONS, RInfra-D’S RESPONSE AND COMMISSION’S

RULINGS

2.1 Tariff related suggestions

i. Shri George John submitted that Tariff proposed by RInfra-D will

adversely affect competition. He also suggested that there should not be

any further increase in CSS, Regulatory Asset Charge and other related

charges.

ii. Bharatiya Udhami Avam Upbhokta Sangh (BUAUS) represented by Shri

Rakshpal Abrol, an authorised Consumer Representative submitted that

RInfra-D must clarify as to why issues of Cross Subsidy Surcharge,

Regulatory Asset, etc., were not projected in its Business Plan Petition.

iii. Shri Abrol further inquired about maximum ceiling of tariff to be fixed by

the Commission for retail supply where two or more Distribution

Licensees exist. Similar query was submitted by Mumbai Grahak

Panchayat, an authorised Consumer Representative in the present Case.

iv. Mumbai Metro One Private Limited (MMOPL) submitted that the

Commission should determine tariff applicable to MMOPL considering

cost of supply rather than Average Cost of Supply, as estimated by RInfra-

D.

v. Niwara Vidyalaya submitted that there must be creation of separate

category for schools run by Public Trusts.

vi. Prana Studios Pvt. Ltd. submitted that it belongs to HT-I category and is

from Animation and Visual effects Industry which is in nascent stage in

India and objected to proposed increase of CSS and Regulatory Asset

Charge proposed by RInfra-D in its MYT petition.

vii. Shri. Ulhas Chaudhari suggested that MMOPL should be categorized

under HT-II Commercial category rather than HT-Railways category.

viii. Urja Prabodhan Kendra submitted that RInfra-D has proposed anew

surcharge under the head Regulatory Asset Surcharge apart from FAC,

Wheeling Charge and CSS, and suggested that such practice of recovery

from past cases should be discontinued in general in future.


Page 19 of 302

ix. Larsen & Toubro Ltd., Arch-V-Shan Creations, Shri. Geoffrey

Mascarenhas, Mahindra & Mahindra Ltd., Kohinoor Ind. Prem Co-op

Society Ltd., Yojna Udyog Pvt. Ltd., Franco-Indian Pharmaceuticals Pvt.

Ltd., Indus Towers Ltd., Unimark Remedies Ltd., Garima Sadan Co-op.

Housing Society Ltd., Momai Impex, Amar Texdys Corporation, have

also raised objection to the increase in CSS and RAC recovery, as

proposed by RInfra-D. All of these objectors submitted that they are

currently not a consumer of RInfra-D but still as per submissions of

RInfra-D in their MYT Petition they need to pay CSS and Regulatory

Asset Charge which is not justifiable.

x. Shri Shirish Deshpande from Mumbai Grahak Panchayat submitted during

Public Hearing Process that the Commission may like to consider the

implementation of maximum ceiling tariff in Mumbai, in view of two

licensees supplying power in same area.

xi. Shri Arun Kadam appeared on behalf of Shri Thakur Ramesh Singh

(MLA) and Shri Shantaram Karande (Maharashtra Navnirman Sena

(MNS)) submitted during Public Hearing Process that Commission may

relook at the Stand by charges, Wheeling charges and CSS, as these are on

higher side and lead to tariff shock to the consumers and also submitted

that there should be equalized Tariff for all Distribution Licensees.

xii. Shri N. Ponrathnam submitted that there should not be any levy of demand

charges on LT consumers. Further, RInfra-D has proposed 115% increase

in demand charges for LT consumers and further submitted that there is

tariff shock to BPL category of consumers in the MYT Petition. Further,

Shri N. Ponrathnam submitted that RInfra-D should provide reason for

considering Mumbai Metro tariff as that of Railways (tariff is Rs. 5/kWh

which is less than ACoS of Rs. 7.48/kWh).

xiii. Shri N. Ponrathnam further submitted that the consumers of commercial

categories (LT II-a, LT II-b, and LT II-c) at the same voltage are charged

differently and RInfra-D should explain the reason for differentiation

between consumers supplied at same voltage.


Page 20 of 302

RInfra-D’s Response

i. RInfra-D submitted that the power purchase cost of RInfra-D is

significantly lower than TPC-D for each year of the MYT Period.

However, since RInfra-D is saddled with a consumer mix highly skewed

in favour of low end/ low paying capacity consumers, its tariffs to high

end consumers continue to be higher so as to maintain affordability of

tariffs for its large mass of low end consumers. RInfra-D further submitted

that equity has to be created through self balancing means such as Cross

Subsidy Surcharge; otherwise historical legacy of consumer mix will wipe

out competition and create another monopoly.

ii. In response to BUAUS query, RInfra-D clarified that Business Plan

submitted before the Commission was not a Tariff Petition and hence

retail tariffs were not proposed therein and the tariff proposal including the

CSS charges and the Regulatory Asset recovery forms part of the present

MYT petition.

iii. In the reply to the query raised by BUAUS that the MYT Petition

submitted vide letter reference RInfra-D/MERC/MYT FY13-16/001 was

not covering the issues of Cross Subsidy Surcharges, Regulatory Assets,

hike of Wheeling Charges etc. on Changeover Consumers, RInfra-D

submitted that the Petition submitted covered all the issues mentioned

above and the objector being a Consumer Representative on the direction

of the Commission, a copy of the Petition was served to him. Also, RInfra-

D submitted that these issues were also covered in the presentation made

before the Commission during the Technical Validation Session held on

February 8, 2013.

iv. In response to suggestion of BUAUS and Mumbai Grahak Panchayat

regarding implementation of ceiling tariff, RInfra-D submitted that in the

present situation in the common area of supply of RInfra-D and TPC-D,

the network spread, cost structure, consumer mix, cross-subsidy situation,

etc., are widely different between the two Licensees. Due to this, the cost-

plus retail tariffs of the two licensees are very different and there is a wide


Page 21 of 302

gap between the two. RInfra-D suggested that in this situation, the

determination of ceiling Tariff may not be practicable.

v. In response to MMOPL query, RInfra-D submitted that the tariff

categorisation, determination, methodology for cost of supply, cross-

subsidisation and reduction of cross-subsidies are prerogative of the

Commission and tariffs will be charged to the consumer in accordance

with the tariff schedule as approved by the Commission.

vi. In response to Niwara Vidyalaya query regarding creation of separate

category for schools run by Public Trusts, RInfra-D submitted that

categorisation is the sole prerogative of the Commission.

vii. In response to Prana Studios Pvt. Ltd., RInfra-D submitted that:

a) Tariff and charges are proposed based on the presently approved

methodology and in line with the principle that the CSS should reflect

the currently approved level of cross-subsidy for the licensee, which is

also borne out of the Commission’s Order in Case No. 138 of 2012.

b) The recovery of regulatory assets is proposed to recover past

accumulated deficits from the users of the network so that the burden

of past liability is not passed on to the remaining consumers of RInfra-

D, but is equitably shared.

c) In a competitive retail supply market consumers decide which supplier

they want to avail power from and such decision is not static, but it is

dynamic, i.e., depending upon the cost economics, suppliers can be

switched by the consumer on any number of occasions.

viii. In response to Shri. Ulhas Chaudhari, RInfra-D submitted that it had

proposed HT-Railways tariff for Metro based on the Commission’s

recognition of Metro and Mono rail under HT- Railways tariff category in

TPC-D’s Tariff Order dated 12 September, 2010 in Case No. 98 of 2009.

ix. In response to Urja Prabodhani Kendra, RInfra-D submitted that it only

recovers tariff from consumers as approved for it by the Commission.

x. In response to Shri N. Ponrathnam, RInfra-D submitted that


Page 22 of 302

a) It is only charging tariffs as approved by the Commission. To make

any change in tariff structure or its applicability is the prerogative of

the Commission.

b) The demand charges for LT categories are proposed to increase from

Rs. 150/kVA/month to Rs. 210/kVA/month. The objector seems to

suggest that present charges are denominated in Rs. /kW and hence

when converted to Rs. /kVA it becomes Rs. 97.5/kVA and has

computed the increase as 115% whereas the actual increase proposed

is only 40%.

c) There is no tariff shock for BPL consumers in the present MYT

Petition.

d) MMOPL has laid its own 33kV cable and associated infrastructure

from the outgoing side of the RInfra’s transmission substation located

at Aarey. Metro Rail is also a form of Railways and hence tariff for

supply to Metro is proposed considering the existing tariff to railways

in Mumbai area. Further, Delhi Metro’s tariff is lower than tariff

applicable to Railways.

e) With regards to differentiation between consumers supplied at same

voltage, RInfra-D submitted that tariff determination and

categorisation is a prerogative of the Commission. However, voltage is

not the only factor to be considered for tariff determination. RInfra-D

recognises the need to reduce the differentiation and has attempted to

do so in its Petition by reducing the cross-subsidy contribution of LT-

II (b) and LT II (c) categories.

Commission’s Rulings

The Commission has noted the suggestion and objections submitted by

consumers and Consumer Representatives and also their replies submitted

by RInfra-D. The Commission has elaborated its views on Regulatory

Asset Recovery and the tariff philosophy in Section 4 and 5 of this Order.

The Commission noted that Business Plan submitted by RInfra-D was as

per MERC MYT Regulations, 2011 and was not a Tariff Petition and


Page 23 of 302

hence retail tariffs, CSS charge and the Regulatory Asset recovery were

not part of the Business Plan Petition.

2.2 Sales

i. Shri George John submitted that RInfra-D projected lower Sales from

Changeover consumers with an assumption that Changeover consumers would

be switched over in a year time, which seems to be an incorrect assumption.

ii. Shri. Sandeep Ohri, an authorised consumer representative in this case

submitted that in the present Case submitted that RInfra-D should explain the

difference in total sales figures between Business Plan Order and MYT

Petition.

iii. The Tata Power Company Ltd. (TPC) submitted that RInfra-D has proposed

lower Wheeling charges recovery by inflating Switchover Sales and

decreasing Changeover Sales.

iv. Shri N. Ponrathnam submitted that RInfra-D should submit various steps

taken to bring down the level of Commercial loss.


i. Regarding reply to Mr. Sandeep Ohri, RInfra-D submitted that there is very

little variation between RInfra-D’s Own sales as computed in the Business

Plan Order and that submitted in the MYT Petition as given in the table

below:

Own Sales (MU) FY 12-13 FY 13-14 FY 14-15 FY 15-16

As per Business Plan 6343 6566 6797 7038

As per RInfra-D MYT Petition 6346 6594 6790 7020

Difference 3 28 (7) (18)

ii. RInfra-D submitted:

a) The power purchase requirement depends only on sales to its own

consumers hence the quantum of power purchase requirement does not

change significantly.


Page 24 of 302

b) Sales to Changeover consumers has been projected to reduce drastically,

as in future Changeover consumers are expected to migrate to TPC-D

network based on the Commission’s directions given to TPC-D in Order

in Case No. 151 of 2011. Therefore, total sales, shows a decline of 19.7%

between FY 2012-13 and FY 2015-16.

iii. In response to TPC’s query regarding over estimation of Switchover sales,

RInfra-D submitted the same reply as submitted to Shri Sandeep Ohri.

iv. In response to Shri N. Ponrathnam, RInfra-D submitted that the theft related

losses due to a variety of reasons – meter bypass, theft from LT pillars, meter

tampering, etc. RInfra-D has been able to bring down the commercial losses

over the years and is continuing its efforts in that direction through

innovative technical solutions such as modular meter cabins, etc.


The Commission observed that the variation in Sales projected in MYT Petition

and Business Plan Order, was mainly on account of changeover sales estimated

by RInfra-D. Variation is as tabulated below:

Particulars FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Own

Sales

Business Plan Order 6343 6566 6797 7038

MYT Petition 6347 6600 6798 7028

Variation 4 34 1 -10

Change

Over

Sales

Business Plan Order 2872 2852 2845 2861

MYT Petition 3076 1567 526 549

Variation 204 -1286 -2319 -2312

From the above table, it can be inferred that:

a) Own Sales: There has been marginal variation in RInfra-D Own sales as projected in

RInfra-D Business Plan Order in Case No. 158 of 2011 and present MYT Petition of

RInfra-D, and that is on account of actual sales of FY 2012-13 as has been considered by

RInfra-D.


Page 25 of 302

b) Changeover Sales: Variation in changeover sales is mainly due to assumption of RInfra-

D that conversion of changeover consumers to switchover in accordance with the

directions of the Hon’ble Commission in Case No. 151 of 2011 dated 22 August, 2012.

However, the Commission has approved sales for the second Control Period based on the

latest data available on Changeover sales and also considered the changeover sales

approved by the Commission in its Order in Case 179 of 2011 in the matter of approval

of MYT Petition of TPC-D. The Commission has elaborated its views in Section 3 of this

Order.

2.3 Distribution Loss

i. Shri George John submitted that Distribution loss of 9.46% is on higher side

and a benchmark of 9.25 % may be set and a suitable incentive may be

provided (2/3rd-1/3rd profit sharing between Utility and Consumers), to

incentivise Utility to achieve 8.5% distribution loss.

ii. Shri. Sandeep Ohri submitted that RInfra-D should explain the difference in

Distribution loss trajectory between Business Plan Order and MYT Petition.

iii. Shri N. Ponrathnam submitted that during Public Hearing Process, RInfra-D

should submit the basis for the statement made in the proceedings before the

Hon’ble ATE that 65% customers come under the category of non-slum

dwellers and 35% are slum dwellers, and that the distribution losses of non-

slum consumers is less than 1% while losses in slum area vary between 15%

to 70% with an average of 22%. He further suggested that the Distribution

losses projected by RInfra-D are on higher side and the Commission should

fix the realistic target of achieving distribution loss.


i. RInfra-D submitted that it cannot comment on distribution loss trajectory

suggestions which are not supported by any analysis. RInfra-D further


Page 26 of 302

submitted that in its MYT Petition it has considered Distribution loss on the

current base value of FY 2011-12 and reductions thereafter are considered

based on the Capex plan.

ii. RInfra-D submitted that in the Business Plan the FY 2011-12 figures were

not available and hence, it considered the distribution loss of FY 2010-11.

Further, the movement of consumers from RInfra-D’s network to TPC-D’s

network could likely cause distribution losses to go up due to worsening of

consumer mix on RInfra-D’s network.

iii. In response to Shri. N. Ponrathnam’s query, RInfra-D submitted that:

a. Overall distribution losses for RInfra-D area are 9.46% as per FY

2011-12 actuals. The area comprises of high loss and low loss

pockets. In the present arrangement of ACoS, all cost and losses are

socialised so that all consumers pay for the same loss level and based

on the same ACoS, irrespective of usage of network, voltage of

connection or actual loss levels in a particular geographical area.

b. Distribution loss target is set for the area of supply as a whole and not

separately for different pockets within the supply area. However,

losses applicable on wheeling consumers are differentiated voltage-

wise in the presently approved methodology.

c. As long as the consumer remains with RInfra-D supply, it absorbs the

commercial loss of RInfra-D distribution system, however the

moment it transfer to TPC-D as Changeover consumer, it is insulated

from commercial losses of RInfra-D, despite the fact that for all the

changeover consumers metering, assessment of sale towards theft,

stopped/ faulty meters, giving credit for high consumption complaints

is unilaterally done by TPC-D.


The Commission observes that RInfra-D submitted in its Business Plan Petition

that the distribution losses of FY 2011-12 are considered as 9.05%, which were

based on actual losses of FY 2010-11. RInfra-D projected no reduction in base


Page 27 of 302

losses of 9.05% till FY 2013-14, while assuming the loss reduction to 9.00% in

FY 2014-15 and 8.95% in FY 2015-16. For the purpose of the Business Plan, the

Commission in its Order in Case No. 158 of 2011 dated 23 November, 2012

considered the loss trajectory as submitted by RInfra-D for the period from FY

2012-13 to FY 2015-16.

However, RInfra-D in its present MYT petition has considered the actual

distribution loss for FY 2011-12 as mentioned in the True-up Order for FY 2011-

12 as approved in Case No. 124 of 2012. The same base has now been considered

for the MYT period with reduction of 0.05% in the last two years. The quantum

of reduction i.e., 0.05% for FY 2014-15 and FY 2015-16 is kept same as that

submitted by RInfra-D in its Business Plan.

The Commission has considered the loss reduction trajectory as approved in its

Business Plan Order and applied it to actual distribution loss approved in Case

No. 124 of 2012. The Commission has elaborated its views in Section 3 of this

Order.

2.4 Power Purchase Expenses

i. Prayas Energy Group and Mr. Sandeep Ohri submitted that RInfra-D should

explain the variation in Power Purchase Costs as submitted in its MYT Petition

with that approved by the Commission in its Business Plan Order in Case No. 158

of 2011 dated 23 November, 2012. Further, RInfra-D should specifically explain

high cost of Short term and Medium term Power Purchase for the MYT Period.

ii. Shri. Rakshpal Abrol inquired about the procurement of electricity more than 500

MW from their Generating plant, cost of Transmission towers already recovered

till 15 August 2011and RInfra-D must submit information about fixed assets

transferred of land and properties of Distribution division.

iii. Shri Shirish Deshpande from Mumbai Grahak Panchayat submitted during public

hearing process that Power Purchase Cost of RInfra-D is less than TPC-D even


Page 28 of 302

then tariff of RInfra-D is higher than that of TPC-D. Further, FAC may not be

increased in following three years of the MYT from FY 2013-14 to FY 20015-16

and wheeling Charges should be kept constant.


i. RInfra-D submitted that the main variation in power purchase cost of Rs. 1667 Crore

in MYT Petition as compared to approved power purchase cost exists due to DTPS

cost estimates. In the Business Plan Order, the Commission considered prevailing

DTPS Tariff Order of September 2010 (applicable for FY 2010-11) which was based

on the fuel prices prevalent in FY 2009-10. Whereas in its current MYT Petition,

RInfra-D has considered the forecast of RInfra-G made in its MYT Petition from FY

2013-14 to FY 2015-16.

ii. RInfra-D further submitted that the difference existed only on variable cost as it

considered appropriate to factor in the actual landed cost of coal and secondary oil as

per the available data of FY 2012-13. Further, the increase in freight charges was

considered based on the actual freight increase effective from March 2012 onwards.

RInfra-D further submitted that even the present MYT Petition does not entirely

reflect the increase in freight charges may be effective from FY 2013-14 onwards (an

increase of 6% announced in the recent Rail Budget, whereas the MYT petition only

considers an increase of 4.37% in the freight charges).

iii. RInfra-D further submitted that it has to procure power mainly during peak hours in

view of peculiar load curve. RInfra-D submitted that average rate of Peak Power

purchase as per CERC Market Monitoring Report as given below:

Year Average Peak Rate in Rs/kWh

FY 2009-10 6.29

FY 2010-11 5.26

FY 2011-12 5.48

FY 2012-13* (Upto Nov 12) 5.41

iv. RInfra-D also submitted that the peak power rates are fluctuating year on year with no

specific trend. RInfra-D further submitted that its power purchase rate for short term


Page 29 of 302

power for FY 2011-12 was Rs 4.47/unit which was much lower than peak power rate

of transactions across the Country.

v. RInfra-D has considered power purchase rate for FY 2011-12 as base rate with

escalation of 3% for the Control Period. Regarding Medium term power purchase

rate, RInfra-D submitted that the rates are as discovered following the due process of

competitive bidding and have been adopted by the Commission.

vi. In response to Shri Abrol’s query, RInfra-D submitted that under an arrangement, the

other sources of power already tied up and to be tied up is adequately addressed in its

MYT Petition. Regarding recovery of cost of generation, transmission and

distribution till 15 August, 2011, RInfra-D stated that all expenses to construct

develop, upgrade, operate and maintain are ongoing in nature and have to be

recovered on an annual basis including expenditure in transmission business. Both the

Capex and Opex related costs are ongoing for the business and therefore recovered on

an ongoing basis. RInfra-D further submitted that no fixed assets are transferred out

of Mumbai distribution business.


The Commission has observed that Shri Ohri seems to have estimated the variation of Rs.

3314 Crore in power purchase is on account of reasons mentioned below:

a) DTPS cost which is projected by RInfra-D based on MYT Petition of RInfra-G:

Extract of Order in Case 158 of 2011 in the matter of Business Plan approval of

RInfra-D dated 23 November 2012.

“The Commission has considered the fixed and energy charges same as those

approved while determining Tariff for RInfra-G for FY 2010-11 in the Order in

Case 99 of 2009. i.e. fixed charges of Rs. 216.61 Crore and energy charges at Rs.

2.12 per unit, for the purpose of this Order on provisional basis and the

Commission shall consider the year-wise rate and fixed charges approved in

RInfra-G’s MYT Petition, while issuing the Order on RInfra-D’s MYT Petition.”

The variation in Power Purchase cost of DTPS is tabulated as under:

DTPS (in Rs. Crore) FY 2012-13 FY 2013-14 FY 2014- 15 FY 2015-16

Business Plan Order 1,019.24 1,019.24 1,019.24 1,021.57


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DTPS (in Rs. Crore) FY 2012-13 FY 2013-14 FY 2014- 15 FY 2015-16

MYT Petition 1,303.67 1,525.02 1,437.90 1,478.55

Variation 284.43 505.78 418.66 456.98

Total (a) 1,665.84

b) Transmission Charges:

In the Commission’s Order in Case No. 158 of 2011 in the matter of Business Plan

approval of RInfra-D dated 23 November 2012, Transmission Charges were not

considered in the Power Purchase Expenses table referred by Shri Ohri and were

treated as a separate Head. However, RInfra-D in their MYT petition have considered

Transmission Charges as a part of their Power Purchase Expenses table, due to which

there is a variation of Rs. 1143.86 Crore, which is as provided in the table below:

Transmission Charges

(in Rs. Crore) FY 2012-13 FY 2013-14 FY 2014- 15 FY 2015-16

MYT Petition 265.39 278.66 292.59 307.22

Variation 265.39 278.66 292.59 307.22

Total Variation (c) 1143.86

c) Short Term Power Procurement Rate and Quantum:

Extract of Order in Case No. 158 of 2011 in the matter of Business Plan approval of

RInfra-D dated 23 November 2012.

“The Commission has accepted the short-term rates (for procurement or sale of

surplus) as projected by RInfra-D in the business plan for the period FY 2012-13 to

FY 2015-16 and utilised the same for computing the cost of power purchase…”

Relevant Extract of MYT Petition submitted by RInfra-D:

“The base price of short term power purchase is considered as the actual weighted

average price of the short term power purchased by RInfra-D in FY 11-12. Further

annual escalation rate of 3% is used to project the price of short term power

purchase from FY 12-13 to FY 15-16.”

…

“The short term power procurement cost approved by the Hon’ble Commission is Rs.

4 per kWh based on RInfra-D’s estimates at such point in time. However in the


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present petition, RInfra-D, in an attempt to be more realistic, has considered the cost

of short term power procurement based on the weighted average price of the actual

short-term power purchase in FY 11-12.”

Short Term FY 2012-13 FY 2013-14

MU Rate Rs. Cr MU Rate Rs. Cr

Business Plan

Order 422.40 4.25 179.52 492.80 4.00 197.12

MYT Petition 514.53 4.60 236.68 746.44 4.74 353.81

Variation (Rs

Cr) 57.16 156.69

Short Term FY 2014-15 FY 2015-16


Business Plan

Order 510.40 4.00 204.16 545.60 4.00 218.24

MYT Petition 493.34 4.88 240.75 631.09 5.03 317.44

Variation (Rs

Cr) 36.59 99.20

Total variation on account of this head is Rs. 349 Crore.

d) Revenue from Sale of Surplus Power:

Relevant Extract of MYT Petition submitted by RInfra-D:

“The sale of surplus power considered by the Hon’ble Commission is Rs.4 per unit.

However, considering the fact that RInfra-D’s surplus power is mostly available in the

night hours when the demand of power is low and realised rate is accordingly poor,

RInfra-D has considered the rate of sale of surplus power based on the actual realization

from of sale of surplus power in FY 11-12.”

Sale of Surplus Power

FY 2012-13 FY 2013-14


Business Plan Order -739.03 4.25 -314.09 -651.49 4.00 -260.60

MYT Petition -645.94 3.03 -195.72 -462.32 3.12 -144.24


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Variation (Rs Cr) 118.37 116.35

Sale of Surplus Power

FY 2014-15 FY 2015-16


Business Plan Order -813.12 4.00 -325.25 -623.68 4.00 -249.47

MYT Petition -717.93 3.21 -230.46 -615.92 3.31 -203.87

Variation (Rs Cr) 94.79 45.60

Total variation on this account is Rs. 375 Crore

e) Additional payment to WPCL:

The additional payment made to WPCL as directed by the Commission in its Order in

Case No. 39 of 2012. Such payment is due to change in Excise duty, VAT and

Customs duty. As against the total claim of Rs. 27.6 Crore for FY 2011-12, RInfra-D

has made payment of Rs 19.5 Crore as undisputed amount till date. The relevant

extract for further payment to WPCL in the MYT Petition is as below:

“Further claim of Rs 26.7 Crs was raised by WPCL for the period April 12 to

September 12, against which RInfra-D has made payment of Rs 7.23 Crs. Matter

is sub-judice before Hon’ble Commission for adjudication and any future

payments will be based on the outcome of Case No 39 of 2012. The same liability

is expected for the second half of FY 12-13. Hence, an additional payment of Rs.

14.46 Crore is considered in the MYT Petition for FY 12-13, over and above the

payment of Rs. 19.5 Crore (pertaining to FY 11-12) as described above. Further,

since power will be off taken from WPCL during FY 13-14 as well, the same

change in law impact will cause an additional liability of Rs. 14.46 Crore for FY

13-14 as well. The same is accordingly added to the power purchase cost of FY

13-14.”

Wardha Power

(in Rs. Crore) FY 2012-13 FY 2013-14

Business Plan Order 952.38 779.13

MYT Petition 986.45 793.68

Variation 34.07 14.55

Total variation on this account is Rs. 49 Crore.

f) Long Term Contract with VIPL:


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In the Business Plan Order in Case No. 158 of 2011 dated 23 November, 2012, the

Commission considered as given below:

“RInfra-D has submitted that for the purpose of Business Plan, it has assumed

that about 500 MW of power would be procured for FY2014-15 and FY2015-

16 and the rate of procurement for the same is assumed at Rs. 3.90 per unit,

….

For the approval of Business plan, the Commission has accepted RInfra-D’s

submissions for the quantum (MW) and rate as projected.”

RInfra-D in its present MYT Petition has submitted as given below:

“Since the existing medium term contracts are applicable till FY 13-14, for

the period FY15 onwards, there would be a significant shortfall in base load

supply without additional power procurement. The additional quantum

required in FY 14-15 is about 530 MW as already worked out in the previous

section of this petition.

To meet the shortfall, R-Infra D is considering procuring 600MW from

Vidarbha Industries Power Limited from FY 14-15 onwards. Net energy

availability after subtracting auxiliary consumption would be about 544

MW. A petition for approval of Long Term PPA between Reliance

Infrastructure Limited (Mumbai Distribution) and Vidarbha Industries Power

Limited and Determination of Provisional Tariff for VIPL’s Butibori Plant

has been submitted on 28 December, 2012 to the Hon’ble Commission and

assigned Case No. 2 of 2013.”

VIPL (in Rs.

Crore) FY 2012-13 FY 2013-14 FY 2014- 15 FY 2015-16

Business Plan Order 498.88 498.88 1,451.97 1,455.95

MYT Petition 497.78 511.75 1,384.87 1,404.58

Variation -1.1 12.87 -67.1 -51.37

Total Variation (f) -106.70

g) Power Procurement from Renewable Energy Sources:

Renewables

(in Rs. Crore) FY 2012-13 FY 2013-14 FY 2014- 15 FY 2015-16

Business Plan Order 273.84 341.66 353.22 365.28

MYT Petition 274.99 293.22 298.24 304.79

Variation 1.15 -48.44 -54.98 -60.49

Total Variation (g) -162.76


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The Commission observed that above mentioned variation is mainly on account of

assumption of RInfra-D that shortfall in Non-Solar RPO would be met through purchase of

REC at Rs 1.85 per kWh. Hence, the total variation amounts to Rs. 3314.34 Crore under

various heads as mentioned above.

The Commission has admitted the Petition after detailed scrutiny of the MYT Petition and

does not find any discrepancy in admission of the Petition. The Commission noted the

other suggestion and objections submitted by consumers and Consumer Representatives

and also their replies submitted by RInfra-D.

2.5 Operation and Maintenance (O&M) Expenses

Shri Abrol inquired about nature and utilisation of O&M expenses and Service

line charges. A similar query was submitted by Shri Ulhas Chaudhari and TPC.


i. RInfra-D submitted that O&M cost is an ongoing expense to run the distribution

business, maintain and upkeep the network. It is annual expense and not a one-

time cost, which can be recovered till a particular point in time and not thereafter.

ii. RInfra-D further submitted that the service line charges are paid for by the

consumers for last mile connectivity only and that too up to a normative amount

as per the applicable Schedule of Charges. All recovery made towards service line

contribution is deducted from the GFA to work out the allowable interest on loans

and Return on Equity. The Service Line contribution is charged to the consumers,

based on the Commission’s approved schedule of charges, and is deducted from

the capitalisation during the respective years. Therefore, such amount is not

included in the capitalisation amount considered for ARR purposes.


The Commission has noted various objections and suggestions of the consumer

representatives on this issue and also the reply submitted by the RInfra-D in this

matter of utilisation of Service line charges. The Commission has elaborated its

views on O&M expenses in Section 3 of this Order.


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2.6 Capital Expenditure and Capitalisation

i. Shri. Sandeep Ohri submitted that RInfra-D should explain increase in

capitalisation as submitted in its MYT Petition with that approved by the

Commission in its Business Plan Order in Case No. 158 of 2011 dated 23

November, 2012.

ii. TPC submitted that RInfra-D has proposed huge Capital Expenditure thereby

creating large quantum of stranded assets.

iii. Urja Prabodhan Kendra suggested that the necessary HT/ LT network used by

TPC-D for Changeover consumers may be purchased by TPC and wheeling

charge portion proposed by RInfra-D should be eliminated.


i. Regarding difference in Capitalisation figures in its Business Plan Order and in its

present MYT Petition, RInfra-D submitted that the difference is on account of

approval of additional schemes after the issuance of Business Plan Order and

before the submission of MYT Petition.

ii. In response to TPC-D query, RInfra-D submitted that the entire Capex plan and

each individual scheme has already undergone the due process of in-principle

approval from the Commission and the Commission has exercised its wisdom in

assessing the need for the schemes, their benefits to the customers and the

prudence of cost estimates.

iii. In response to Urja Prabodhan Kendra’s suggestion, RInfra-D submitted that it

means that RInfra-D would sell its network to TPC-D in a given area and end up

laying its fresh network in such area and the obligation of TPC-D to lay its own

network gets transferred to RInfra-D.


The Commission in its Order in Case No. 158 of 2011 dated 23 November 2012 directed

as under:

“With relation to Regulation 27 of the MERC MYT Regulations, 2011 (Capital

cost and capital structure), it is clarified by the Commission that for the Capital

Expenditure schemes which are under process of getting in-principle approval,


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RInfra-D may include in its MYT Petition, the capitalisation pertaining to the

in-principle approved schemes. The Commission also notes that the schemes for

Retail Supply business of RInfra-D are yet to receive in-principle approval.

RInfra-D may include those schemes as well in their MYT Petition if they are

approved before filing of the same.

…”

The Commission has noted that subsequent to issuance of Business Plan Order, the

Commission has approved Capex scheme of capitalisation of Rs 1076 Crore in the

second Control Period.

The Commission noted the suggestion and objections submitted by consumers and

Consumer Representatives and also their replies submitted by RInfra-D. The Commission

has elaborated its views in Section 3 of this Order.

2.7 Depreciation

i. Prayas Energy Group submitted that RInfra-D should explain the reason for higher

Depreciation expenses and Interest on long term loans submitted in its MYT Petition

with that approved by the Commission in its Business Plan Order in Case No. 158 of

2011 dated 23 November, 2012.


RInfra-D submitted that the difference is on account of approval of additional schemes

after the issuance of Business Plan Order and before the submission of MYT Petition. On

account of such increase in capitalisation there has been higher Depreciation expenses

and Interest on long term loans submitted in MYT Petition as compared to the expenses

approved by the Commission in its Business Plan Order in Case No. 158 of 2011.


The Commission in its Order dated 23 November 2012, in Case No. 158 of 2011, has

approved capital expenditure (Capex) related expenses based on the Capex approved by

the Commission till date and directed RInfra-D to incorporate the additional Capex

schemes approved by the Commission after issuance of Business Plan Order and before

submission of the MYT Petition.


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2.8 Procedural Issue

i. Shri. Sandeep Ohri and TPC submitted that RInfra-D’s present MYT Petition

filed by RInfra-D was not duly supported by a properly executed affidavit.

ii. TPC submitted that there was misrepresentation of category-wise tariffs in RInfra-

D’s MYT Petition and Public Notice.


i. RInfra-D submitted that it had originally prepared the MYT Petition to be filed on

14 February 2013. Accordingly, the affidavit supporting the Petition was

notarised on 14 February 2013. However, there were certain clarifications sought

by the Commission in the meeting held on 15 February 2013. These clarifications

did not cause any material change in the Petition and therefore were to be

submitted as an Annexure to the letter dated 16 February 2013. However, these

were inadvertently included as Annexure to the Petition. RInfra-D regretted the

inadvertent error and requested the Commission to condone the mistake and treat

the submissions as a part of the covering letter and may disregard these to be part

of the Petition.

ii. RInfra-D denied any misrepresentation of information in the Public Notice.


The Commission has noted the objections submitted by TPC and Consumer

Representatives and also their replies submitted by RInfra-D. The Commission accepts

the request of RInfra-D in condonation of the procedural error in filing reply by RInfra-

D.

The Commission noted that RInfra-D has represented the Regulatory Asset Charge

(RAC) as a separate line item mainly because it needs to be charged to changeover

consumers also; hence RAC needs to be separated out from the retail tariff of direct

consumers of RInfra-D. The Commission is of the opinion that RInfra-D has submitted in

its Petition that RAC would be charged over and above the retail tariff and hence, there is

no misrepresentation. However, the Commission in this Order has shown the impact of

including recovery of Regulatory Asset on various tariff categories.


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2.9 Energy Charges

Mumbai Grahak Panchayat submitted that RInfra-D has not proposed hike in Energy

Charges for LT consumers which is misleading, as there is no guarantee whether RInfra-

D would not seek FAC at a later date.


RInfra-D submitted that the net average billing rate to any consumer consuming above

300 units is proposed to be lowered than the present rate, due to the reduction in energy

charges proposed by RInfra-D. The existing tariffs include the presently applicable FAC.

In accordance with the MYT Regulations, 2011, the incremental FAC, if any, during a

given year going forward would be dependent on approved power purchase rates in the

MYT Order and the actual movement of power prices in the market during the year.


The Commission noted the objections and also their replies submitted by RInfra-D. The

Commission is of the view that Z factor charge needs to be charged as per MERC MYT

Regulations, 2011.The Commission has elaborated its views in Section 5 of this Order.

2.10 Wheeling Charges

i. Mumbai Grahak Panchayat and Niwara Vidyalaya submitted that RInfra-D

proposed unjustified hike in wheeling charges in its MYT Petition.

ii. Shri Ulhas Chaudhari submitted that the sale of energy to RInfra-D consumers is

nearly 3 times that of energy wheeled to Changeover consumers, but the amount

of wheeling charges recovered from changeover consumers is only 20% of the

total expenses.

iii. Shri N. Ponrathnam submitted that Wheeling Charges denomination proposed by

RInfra-D is in Rs/kWh format and not in Rs/kW/Month. It was further submitted

that whether RInfra-D uses system load factor in computation of the Wheeling

Charges.


Page 39 of 302


i. RInfra-D submitted that the Wheeling Charges have not been revised for nearly

four years. The present Wheeling charges were approved vide Commission’s

Clarificatory Order dated 22 July 2009, in Case No. 121 of 2008. The increase in

network cost from what was approved in Case No. 121 of 2008 till the projection

made for FY 2013-14 in the present MYT Petition is around 73% and is the main

reason for the its proposal of increase in Wheeling charges. Further, RInfra-D

submitted that the Wheeling charges are proposed based on the presently

applicable methodology.

ii. In response to Shri Ulhas Chaudhary’s query, RInfra-D submitted that the

Wheeling Charges is computed based on total Wires ARR divided by total

voltage-wise energy sales (including both own and changeover sales).This yields

different rates of wheeling charge for HT sales and LT sales. Wheeling charge for

HT consumers is much lower than that for LT consumers. Since, a large part of

changeover consumption is at HT, the wheeling charges recovery is less as

compared to the total wires expenses. Thus, the consumption mix of changeover

consumers creates a situation of lower recovery of wires cost from change-over

consumers, while passing on a larger share to remaining (almost 96%) LT

consumption of RInfra-D’s own consumers.

iii. In response to Shri N. Ponrathnam’s query, RInfra-D clarified that

a) Wheeling charges are proposed by RInfra-D in Rs/unit denomination and not

in Rs./kW/month denomination. The System Load Factor of 68% used in the

MYT Petition to determine Peak Demand of RInfra-D represents the ratio of

Peak Demand to Average Demand in a given year and is based on the

previous few years’ data, which is verifiable from SLDC records.

b) It has not determined system Load Factor based on ABR. Further, Wheeling

Charges proposed by RInfra-D is independent of system Load Factor. RInfra-

D further submitted that the Hon’ble Supreme Court has laid down that

Distribution Licensees who are yet to lay down their networks can supply

electricity in retail to consumers using other licensee’s network, on payment


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of surcharge in addition to charges of wheeling. Hence, wheeling charges are

clearly payable. Further, the Hon’ble ATE, in its Judgment in Appeal Nos.

132, 133, 139, 144 and 164 of 2011, dated 21 December 2012, clearly held

that the act of supply by TPC-D to retail consumers using network of RInfra-

D is Open Access.


The Commission noted the suggestion and objections and also their replies

submitted by RInfra-D. The Commission has elaborated its views in Section 5 of

this Order.

2.11 Cross Subsidy Surcharge

i. Prayas Energy Group and Abhinav Shikshan Prasarak Mandal submitted that

RInfra-D should rework its methodology, as it imposes higher level of Cross

Subsidy Surcharge and also there must be some roadmap for reduction in Cross

Subsidy Surcharge. Similar query was submitted by Mumbai Grahak Panchayat,

TPC and Nagari Nivara Parishad.

ii. Abhinav Shikshan Prasarak Mandal further submitted that CSS is to be applicable

for new consumers changing over in FY 2013-14 and not to consumers changed

over earlier and requested the Commission not to approve high CSS as submitted

by RInfra-D. Similar query was submitted by Nagari Nivara Parishad.

iii. Shri Abrol submitted that RInfra-D should explain applicability of Cross-subsidy

Surcharge and Regulatory Asset charge for consumers below 1000 kVA.

iv. Indian Hotel & Restaurant Association submitted that RInfra-D has created

hurdles in TPC-D’s network development and CSS cannot be levied on change-

over consumers.

v. MMOPL submitted that RInfra-D had not represented CSS correctly by

considering Average Tariff and Average Cost of supply (ACoS).

vi. Retailers Association of India and Shopping Centres Association of India

submitted that RInfra-D’s submission to impose sudden large increase in CSS is


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an attempt to deter other consumers of itself from changing over to TPC-D and it

is abuse of dominant position and denial of market access.


i. Regarding CSS, RInfra-D submitted that it has been calculated with reference to

the proposed tariff and using the formula as provided in the Tariff Policy (with

modification for grossing up of losses). RInfra-D further submitted that the

Commission has also ruled, in its Order in Case No. 138 of 2012 that Surcharge

for each tariff category and sub-category / slab should be based on the approved

current level of cross-subsidy

ii. RInfra-D submitted that as the approved current level of cross-subsidy will vary

from one year to next, the CSS shall also vary in accordance with the same.

Further, RInfra-D submitted that the development of cross-subsidy reduction

roadmap is the prerogative of the Commission and there is a clear cross-subsidy

reduction roadmap in RInfra-D’s MYT Petition itself which indicate that the

tariffs and consequently the cross-subsidy levels and the Cross-Subsidy Surcharge

progressively come down till FY 2015-16 from their starting level in FY 2013-14.

iii. RInfra-D further submitted that its proposal of CSS, including its recovery from

change-over/open access consumers is based entirely on the methodology as

approved by the Commission.

iv. In response to Indian Hotel & Restaurant Association’s query RInfra-D submitted

that it has never placed any hurdles in TPC’s network development

v. In response to MMOPL, RInfra-D submitted it has computed the ACoS as per the

present methodology adopted in State of Maharashtra. ACoS reflects the average

cost of distribution business as a whole. It is not specific to any consumer or

consumer category. Similarly, cross-subsidy is worked out as a ratio of ABR

(based on the proposed tariffs) and the Average Cost of Supply.

vi. RInfra-D replied to Nagari Nivara Parishad and Abhinav Shikshan Prasarak

Mandal that the Cross-Subsidy Surcharge for residential slabs is proposed to

apply telescopically , i.e., the Rs. 5.00 per unit shown for FY 2013-14 will only

apply to units above 500. Therefore, if there is consumption of 550 units then the


Page 42 of 302

effective CSS would be = 0.00*100 + 0.00*200 + 3.53*200 + 5.00*50 = Rs. 1.59

per unit, instead of Rs. 5.00 per unit as considered by the objectors. With this

correction, the effective increase in tariffs would be much less than what the

objectors had stated.


The Commission noted the suggestion and objections submitted by consumers

and Consumer Representatives and also their replies submitted by RInfra-D. The

Commission has elaborated its views in Section 5 of this Order.

2.12 Regulatory Asset and its Recovery Mechanism

i. Abhinav Shikshan Prasarak Mandal submitted that Regulatory Asset charges

cannot be made applicable to Changeover consumers as they are open access

consumers and the Act does not provide levy of any charges on them other than

wheeling charges, CSS and Additional Surcharge. A similar query was raised by

Indian Hotel & Restaurant Association, Urja Prabodhan Kendra and Nagari

Nivara Parishad.

ii. Shri Abrol submitted that the consumers are already paying wheeling charges,

distribution and commercial losses and requested for verification of Regulatory

Assets which was being claimed.

iii. Shri. Ulhas Chaudhari submitted that the entire Regulatory Asset approved in

Case No. 180 of 2011 should be recovered through a one-time monthly bill of the

consumers along with the carrying cost accumulated till date.

iv. TPC submitted that RInfra-D has no right to claim Regulatory Asset Charge from

Changeover Consumers. A similar submission was made by Shri N. Ponrathnam

submitted during Public Hearing Process.


i. RInfra-D submitted that the Regulatory Assets represent past accumulated

receivables and are in nature to arrears, recoverable from all consumers, including

past consumers.


Page 43 of 302

ii. In response to Shri Abrol’s query, RInfra-D submitted that Wheeling charges are

presently being levied on the changeover/open access consumers as per the Order

of the Commission in Case No. 121 of 2008. RInfra-D further submitted that

Regulatory Assets refer to past accumulated revenue deficit and has no relation

with the capital assets, except to the extent to accumulated deficit due to non-

recovery of capital related expenses such as depreciation, interest and return.

RInfra-D further submitted that TPC-D is well aware of the treatment provided

for regulatory asset recovery for its Distribution License in Delhi which allows

recovery of a separate 8% Surcharge on tariffs for recovery of past accumulated

deficit.

iii. In response to Shri. Ulhas Chaudhari, RInfra-D submitted that the suggestion of

entire one time recovery of Regulatory Asset Charge, would lead to a tariff shock

for consumers. Accordingly, RInfra-D has suggested a phased recovery of

regulatory asset.

iv. In response to TPC query, RInfra-D submitted that Regulatory Assets represent

past accumulated receivables and are akin to arrears, recoverable from all

consumers, including past consumers. The Regulatory Assets represent a deferred

recovery of the past cost and it is prudent to let the consumer know the current

cost as reflected in tariff and the past deferred recovery separately. RInfra-D

further submitted that TPC-D is well aware of the treatment provided for

regulatory asset recovery for its Distribution License in Delhi which allows

recovery of a separate 8% Surcharge on tariffs for recovery of past accumulated

deficit.


The Commission noted the suggestion and objections submitted by consumers

and Consumer Representatives and also replies submitted by RInfra-D. The

Commission has elaborated its views in Section 5 of this Order.


Page 44 of 302

2.13 Distribution License related issues

i. MMOPL submitted that its load is directly connected with 220/33kV receiving

station of RInfra-T. Entire cost of laying 33kV network is borne by MMOPL and

it is directly off-taking power from receiving station at Aarey and cannot be

regarded as connected to RInfra-D and a consumer of RInfra-D.

ii. Shri N. Ponrathnam submitted that the concept of Wheeling was introduced in the

Act to enable Distribution Licensees who are yet to install their distribution line to

supply electricity directly to retail consumers, subject to payment of surcharge in

addition to the charges for Wheeling as determined by the State Commission.

Hence, RInfra-D should provide its wires to TPC-D to enable them to supply

power to retail consumers.


a. RInfra-D submitted that it has a composite licence for wires business and supply

business as stipulated in the EA, 2003 and the expenses are approved in Order to

correctly determine the expenses of network to be levied on Open Access / Wheeling

consumers.

b. In response to MMOPL query, RInfra-D submitted that physical connection

pertaining to Metro Load is made directly with the 33 kV side of RInfra-T’s Aarey

R/S. However, the consumer is a consumer of RInfra – Distribution business only.

c. In response to Shri N. Ponrathnam query, RInfra-D submitted that under the Act, each

Distribution Licensee is obligated to lay its own distribution network in order to

supply electricity to the consumers. The Distribution Licensee is duty bound under its

license to develop, maintain and operate its distribution network and meet its

Universal Supply Obligation.


This licence related issues are outside the ambit of present proceeding in tariff

determination process.

The Commission notes that Section 2(15) of the Act, states as under:


Page 45 of 302

“(15) "consumer" means any person who is supplied with electricity for his own use by a

licensee or the Government or by any other person engaged in the business of supplying

electricity to the public under this Act or any other law for the time being in force and

includes any person whose premises are for the time being connected for the purpose of

receiving electricity with the works of a licensee, the Government or such other person,

as the case may be;” emphasis added

The Commission notes that the definition of consumer clearly recognises a person who is

supplied by a Licensee as a consumer. Hence, the Commission is of the opinion that

MMOPL is a consumer of RInfra-D, though it may have been connected to RInfra-T

network.


Page 46 of 302

3. DETERMINATION OF THE ARR for the CONTROL PERIOD from FY

2012-13 to FY 2015-16

3.1 Sales forecast

3.1.1 Approach

3.1.1.1 RInfra-D submitted that it adopted following approach for estimation of its Own

Sales for the Second Control Period from FY 2012-13 to FY 2015-16 as:

a) Estimation of total sales in the RInfra-D area including energy supplied to

Changeover consumers by TPC-D.

b) Estimation of Changeover sales category-wise considering the impact of

Order in Case No. 151 of 2011 dated 22 August, 2012.

c) Estimation of RInfra-D own sales which is difference of the total sales and

Changeover sales.

3.1.2 Estimation of Total Sales

3.1.2.1 RInfra-D submitted that

a) The actual sales data available for the period April 2012 to September 2012 (both

own and change-over) was used to estimate total sales for FY 2012-13.

b) Due to huge seasonal variations in demand, sales estimate for period October 2012

to March 2013 needed to consider the effect of seasonality. Hence, the consumer

category wise total sales for the period October 2012 to March 2013 was estimated

by applying a “Seasonality Factor” on the actual data for the period April 2012 to

September 2012.

c) The Seasonality factor was computed category wise based on the ratio of actual

total sales of October 2011 – March 2012 (6 months cumulative) to actual Total

Sales for the period April 2011-September 2011 (6 months cumulative) for each

consumer category.

3.1.2.2 The total sales for each year of the rest of the Control Period was estimated by

applying historical total sales growth rate to the estimated total sales for FY 2012-

13. RInfra-D further submitted that the growth rate for each consumer category was

estimated based on the last five years (FY 2007-08 to FY 2011-12) actual total sales


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(MU) data. The category wise growth rates used by RInfra-D, for estimation of

total sales, are given in the table below:

Table 1: Total sales CAGR - Category wise Total Sales (%) as submitted by RInfra-D

Consumer Category Growth Rate (%)

LT Residential 2.99%

LT Commercial 4.36%

LT Industrial 2.65%

LT Advertisements 5.28%

LT Street Light 2.14%

LT Temporary 3.49%

HT Industrial 2.11%

HT Commercial 9.05%

HT Housing 2.06%

3.1.2.3 RInfra-D submitted that in its MYT Petition, it has adopted the approach of

forecasting total sales (i.e. total sales in license area, including change-over

consumers) based on historical growth rates, as past growth rates in electricity

consumption will be reflective of the future and the future growth rates will not be

very different from the past. RInfra-D also submitted that in the past, even in the

face of increasing urbanisation and commercialisation in the licensed area, the

CAGR based sales forecast has produced fairly accurate results when the sales as

forecast at the time of ARR submission is compared with the actual sales at the time

of true-up.

3.1.2.4 The total energy consumption in the licensed area of supply for each year of the

MYT Period as submitted by RInfra-D is given in the table below:


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Table 2: Total Sales as projected by RInfra-D of consumer connected to its Distribution

System (MU)

Consumer Category & Consumption Slab FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

LT I - Below Poverty Line 0.04 0.04 0.05 0.05

LT -I Residential (Single Phase) - - - -

0-100 1,793.89 1,847.45 1,902.61 1,959.42

101-300 1,356.10 1,396.59 1,438.28 1,481.23

301-500 286.85 295.42 304.24 313.32

501 and above 166.03 170.98 176.09 181.35

LT -I Residential Three phase - - - -

0-100 192.35 198.09 204.00 210.09

101-300 333.49 343.45 353.70 364.26

301-500 230.62 237.50 244.59 251.90

501 and above 565.33 582.21 599.60 617.50

LT II (a) - 0-20 kW 1,693.10 1,766.83 1,843.79 1,924.09

LT II (b) - 20-50 kW 243.13 253.72 264.77 276.30

LT II (c) - above 50 kW 603.50 629.79 657.22 685.84

LT III - LT Industrial upto 20 kW 182.57 187.42 192.39 197.50

LT IV - LT Industrial above 20 kW 493.85 506.95 520.41 534.22

LT-V : LT- Advertisements and Hoardings 3.22 3.39 3.57 3.76

LT VI: LT -Street Lights 56.51 57.73 58.96 60.23

LT-VII (A): LT -Temporary Supply Religious 1.01 1.04 1.08 1.12

LT-VII (B): LT -Temporary Supply Others 92.55 95.77 99.12 102.57

LT VIII: LT - Crematorium & Burial Grounds 1.17 1.20 1.24 1.27

LT IX: LT –Agriculture 0.04 0.04 0.04 0.05

Total- LT Sales 8,295.52 8,575.82 8,865.95 9,166.27

HT I: HT-Industry 353.13 360.59 368.20 375.98

HTII : HT- Commercial 729.63 795.63 867.60 946.08

HT III: HT-Group Housing Society 38.63 39.42 40.24 41.07

HTIV : HT - Temporary Supply 4.27 4.35 4.44 4.53

HT - Railways (New Category) - 57.80 57.80 78.40

Total - HT Sales 1,125.66 1,257.80 1,338.28 1,446.05

Total 9,421.18 9,833.62 10,204.23 10,612.33


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3.1.2.5 Further, in reply to the Commission’s query regarding basis of CAGR for LT VIII,

LT IX and HT IV as these were hard punched values in the model, RInfra-D

submitted vide its reply dated 11 February, 2013 that:

“Sales for HT IV category (HT temporary supply) has been introduced in FY

2009-10 and the data from FY 2009-10 onwards shows wide variations on a Year

on Year basis, due to less volume, no specific trend in consumption as

connections are only temporary, etc. Hence, historical CAGR may not provide the

right picture while estimating sales for a longer period from FY 2012-13 to FY

2015-16. Hence sales for this category have been considered at a moderate

growth rate of 2% per annum. For LT VIII (Crematorium) and LT IX

(Agriculture), historical 5 year CAGR (FY 2006-07 to FY 2011-12) was relatively

high compared to growth rate considered in other categories. Considering the

huge difference in Historical 5 year CAGR (FY 2006-07 to FY 2011-12) and

Historical 2 year CAGR (FY 2009-10 – FY 2011-12), the higher growth rate may

not be realized in the future simply because there is no reason to believe that

there would be any spurt in the number of crematoriums or for that matter

agriculture pumpset connections in the area of supply. Hence a moderate growth

rate of 3% has been considered, which is representative of the average increase

in sales (including both HT and LT) for two year period from FY 09-10 to FY 11-

12 for both these categories.”

3.1.3 Estimation of Changeover Sales

3.1.3.1 RInfra-D submitted that its approach for estimating Changeover Sales is based on

consideration of the directions given by the Commission to TPC-D in its Order in

Case No. 151 of 2011 dated 22 August, 2012.

3.1.3.2 RInfra-D further submitted its approach for estimation of Changeover Sales as given

below:

a) Existing Changeover sales estimation: Estimation of sales to existing

changeover consumers as on September 2012 in all 20 clusters was considered

by RInfra-D. For FY 2012-13, to estimate sales from existing changeover


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consumers, actual data for the period April to September 2012 was considered.

For rest of FY 2012-13, seasonality factor was applied to sales of April to

September 2012 to arrive at the sales for October 2012 to March 2013.

Seasonality Factor used in estimation of Total sales was adjusted to reflect the

lack of additional growth in consumers while estimating sales from existing

changeover consumers. For the period FY 2013-14 to FY 2015-16, a specific

consumption growth rate of 2% was assumed on the FY 2012-13 estimated sales

number to determine sales to existing changeover consumer for the respective

year.

b) Additional Changeover sales estimation: Estimation of Sales to additional

changeover consumers in all clusters only from the residential (0-300 units)

category. RInfra-D submitted that for the period April 2012 to September 2012,

around 37,500 consumers in the region common to RInfra-D and TPC-D from

Residential category (0-300 units) have additionally migrated/changed over to

TPC-D. Based on this trend, around 75,000 consumers can potentially migrate

from RInfra-D to TPC-D in the above mentioned categories. Hence, for MYT

Petition, RInfra-D assumed that 75,000 consumers will migrate/change over

each year from FY 2012-13 onwards to FY 2015-16. RInfra-D submitted that a

uniform specific consumption growth rate of 2% was used to estimate the sales

for additional changeover consumers for the period FY 2012-13 to FY 2015-16.

RInfra-D submitted year wise addition considered in change-over residential

consumers (Single & Three Phase) with consumption between 0-300 units per

month as given in the table below:

Table 3: Additional Changeover over Consumers as submitted by RInfra-D

Additional Changeover consumers FY

2012-13 (H2)

FY

2013-14

FY

2014-15

FY

2015-16

Total Number of consumers 37,500 75,000 75,000 75,000

Residential (1 Phase)

0-100 18,000 36,000 36,000 36,000

100-300 17,250 34,500 34,500 34,500

Residential (3 Phase)

0-100 750 1,500 1,500 1,500


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Additional Changeover consumers FY

2012-13 (H2)

FY

2013-14

FY

2014-15

FY

2015-16

100-300 1,500 3,000 3,000 3,000

c) Pending applications sales estimation: RInfra-D submitted that it included

Sales pertaining to Pending applications as on August 22, 2012 in all 20 clusters.

Further, the effect of Order in Case No. 151 of 2011 was applied by RInfra-D

as:

d) Subsequent to 21 August, 2013, the sales to existing changeover consumers

were pruned down proportionately to represent the same only from the 9 clusters

as per Order in Case No. 151 of 2011.

e) Subsequent to 21 August, 2013 till end of FY 2015-16 , the sales to additional

change-over consumers from 0-300 residential category were pruned down to

proportionately represent the same from only the remaining 9 clusters.

RInfra-D also submitted that the existing ratio between changeover sales in 9

clusters with respect to total changeover sales in all 20 clusters was used to

estimate the sales in the 9 clusters post 22 August 2013.

3.1.3.3 The sales projections for changeover consumers as submitted by RInfra-D, is given

in the table below:

Table 4: Changeover Sales as projected by RInfra-D (MU)


2012-13

FY

2013-14

FY

2014-15

FY

2015-16


LT -I Residential (Single Phase)

0-100 36.40 26.26 8.78 11.56

101-300 209.99 126.38 37.87 46.72

301-500 119.27 55.13 13.06 13.32

501 and above 107.03 49.48 11.72 11.95

LT -I Residential Three phase

0-100 2.21 1.36 0.57 0.69

101-300 49.12 27.95 10.94 12.53

301-500 84.64 42.28 14.53 14.82

501 and above 328.62 164.15 56.40 57.53

LT II (a) - 0-20 kW 410.31 194.28 51.84 52.87

LT II (b) - 20-50 kW 109.84 54.60 18.09 18.46


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2012-13

FY

2013-14

FY

2014-15

FY

2015-16

LT II (c) - above 50 kW 387.81 210.29 92.27 94.12




LT VI: LT -Street Lights - - - -

LT-VII (A): LT -Temporary Supply Religious - - - -



LT IX: LT –Agriculture - - - -

Total- LT Sales 2,218.09 1,105.66 325.36 344.03

HT I: HT-Industry 271.85 131.28 39.13 39.91




HT - Railways (New Category) - - - -

Total - HT Sales 858.21 460.84 200.71 204.72

Total 3,076.30 1,566.50 526.07 548.76

3.1.3.4 RInfra-D submitted that it has projected a significant reduction in Changeover sales

from FY 2013-14 onwards, due to conversion of existing Changeover consumers in

FY 2012-13 to Switchover, i.e., connection to TPC-D’s distribution network.

3.1.4 Estimation of RInfra-D Own Sales

3.1.4.1 RInfra-D submitted it estimated its own sales as the difference between the Total

Sales and Changeover Sales. RInfra-D submitted that it projected additional

requirement from Versova- Andheri- Ghatkopar (VAG) Corridor metro Mass Rapid

Transit System (MRTS) project, being implemented by Mumbai Metro One Pvt.

Ltd. which is categorised in a new category – “HT –Railways”

3.1.4.2 Further, in reply to the Commission’s query regarding “Own Sales” increasing from

past, based on the 5 year CAGR whereas there was reduction in the number of

consumers as projected, RInfra-D submitted vide its reply dated 12 February, 2013

that the number of RInfra-D consumers shows a declining trend in the second


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Control Period. RInfra-D submitted that this is primarily due to reduction of

consumers in the residential (0- 300) categories due to migration of consumers to

TPC-D. Also, the number of customers in the residential (0-300) categories is more

than thrice the number of consumers in other categories. Hence, even though the

number of consumers shows a reduction on absolute number basis, however on

percentage terms, the reduction in sales is small (less than 3% CAGR basis for the

period FY 2012-13 (H2) to FY 2015-16). Further, the contribution per consumer of

Residential (0-300) categories to total sales is significantly lower compared to other

categories. Therefore, the growth in sales in other categories is higher than the small

reduction in sales from residential (0-300) categories. Hence, due to the changing

sales and consumer mix of RInfra-D, there is an increase in sales despite the

reduction in overall number of consumers.

3.1.4.3 The Own sales projections as submitted by RInfra-D without considering impact of

Demand Side Management (DSM) is given in the table below:

Table 5: Own Sales as projected by RInfra-D (without considering impact of DSM) (MUs)


2012-13

FY

2013-14

FY

2014-15

FY

2015-16



0-100 1,757.50 1,789.51 1,819.24 1,849.63

101-300 1,146.10 1,117.73 1,078.48 1,037.34

301-500 167.59 173.76 180.15 186.75

501 and above 59.00 61.81 64.74 67.77


0-100 190.13 195.30 200.54 205.93

101-300 284.37 286.38 287.36 288.30

301-500 145.98 151.17 156.53 162.08

501 and above 236.72 247.02 257.70 268.77

LT II (a) - 0-20 kW 1,282.78 1,347.12 1,415.68 1,487.42

LT II (b) - 20-50 kW 133.29 141.20 150.00 159.23

LT II (c) - above 50 kW 218.03 233.99 253.45 274.34





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2012-13

FY

2013-14

FY

2014-15

FY

2015-16





LT IX: LT -Agriculture 0.04 0.04 0.04 0.05

Total- LT Sales 6,079.78 6,218.36 6,352.89 6,492.74

HT I: HT-Industry 81.28 83.30 85.37 87.49





Total - HT Sales 267.44 382.00 444.97 534.88

Total 6,347.22 6,600.37 6,797.87 7,027.62

3.1.4.4 Further, as a part of reply to data gaps raised by the Commission, RInfra-D

submitted provisional figures for month-wise Own Sales and revenue from sale of

power as 6192.32 MU and Rs. 4441.59 Crore (including incentives and

disincentives), for FY 2012-13.

3.1.5 Demand Side Management (DSM) Measures

3.1.5.1 RInfra-D submitted that it has continued its efforts to reduce the system demand and

energy consumption through DSM initiatives. The energy savings from various

DSM activities and its Own Sales considering impact of DSM, as submitted by

RInfra-D is as given in the table below:

Table 6: Energy Savings (MU) though DSM activities as submitted by RInfra-D

Program Consumer

Category

FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

T5 FTL Residential 0.15 0.15 0.15 0.15

Five Star Fans Residential

(<500 units) 0.46 0.46 0.46 0.46

Five Star Split A/C LT – II <20kW 0.06 0.06 0.06 0.06

Solar PV plant at LT – II <20kW 0.01 0.01 0.01 0.01


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Program Consumer

Category

FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

MIDC

Five Star Refrigerators Residential - 1.54 1.54 1.54

Five Star Fans – Ph II Residential(<500

units) 0.18 0.60 1.44 1.44

Five Star Split A/C –

Ph II

LT – II <20kW and

LT –III (<20 kW) - 3.87 3.87 3.87

Total 0.86 6.69 7.53 7.53

Table 7: Own Sales as projected by RInfra-D (considering impact of DSM) (MUs)


2012-13

FY

2013-14

FY

2014-15

FY

2015-16


LT -I Residential (Single Phase) - - - -

0-100 1,757.10 1,788.26 1,817.57 1,847.94

101-300 1,145.88 1,116.92 1,077.43 1,036.34

301-500 167.56 173.65 179.99 186.59

501 and above 59.00 61.79 64.71 67.74

LT -I Residential Three phase - - - -

0-100 190.09 195.17 200.36 205.75

101-300 284.31 286.17 287.09 288.04

301-500 145.95 151.06 156.39 161.93

501 and above 236.71 246.92 257.60 268.66

LT II (a) - 0-20 kW 1,282.71 1,343.51 1,412.06 1,483.80

LT II (b) - 20-50 kW 133.29 141.20 150.00 159.23

LT II (c) - above 50 kW 218.03 233.99 253.45 274.34









Total- LT Sales 6,078.92 6,211.67 6,345.36 6,485.21

HT I: HT-Industry 81.28 83.30 85.37 87.49





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2012-13

FY

2013-14

FY

2014-15

FY

2015-16


Total - HT Sales 267.44 382.00 444.97 534.88

Total 6,346.36 6,593.68 6,790.34 7,020.09

3.1.5.2 Further, in response to the Commission’s query regarding classifying “7.5 kW Solar

Power Plant at MIDC” under DSM activities/schemes, RInfra-D submitted vide its

reply dated 11 February, 2013 that this project is planned on a pilot basis for study

purpose to demonstrate the feasibility of demand curtailment during peak hours.

RInfra-D submitted that if reasonable energy savings are achieved and there is

sufficient benefit of the project, the technology would be advocated in the licence

area and consumers will be encouraged to install rooftop solar plants for the

purposes of reducing grid dependency and demand management.

3.1.6 Commission’s Rulings

3.1.6.1 The Commission has accepted the RInfra-D’s submission of actual total retail sales

in its licence area as 6192.32 MU for FY 2012-13, since year is already over and

actual figures are available.

3.1.6.2 The Commission has noted that for period from FY 2013-14 to FY 2015-16, there is

a marginal variation in projected Own Sales in the MYT Petition as compared to the

Order issued by the Commission in Case No. 158 of 2011, which is as under:

In MU

Particulars FY 14 FY 15 FY 16

Own sales as per Business plan order of MERC (table

4.5, page 55)

6566 6797 7038

Own Sales as per RInfra-D MYT petition (table 38,

page 78)

6594 6790 7020

Difference 28 (7) (18)

3.1.6.3 Hence, the Commission has accepted and approves the Own Sales projected by

RInfra-D, which is as under:

Table 8: Own Sales approved by the Commission (considering impact of DSM) (in MUs)


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2013-14

FY

2014-15

FY

2015-16

LT I - Below Poverty Line 0.04 0.05 0.05

LT -I Residential (Single Phase) - - -

0-100 1,788.26 1,817.57 1,847.94

101-300 1,116.92 1,077.43 1,036.34

301-500 173.65 179.99 186.59

501 and above 61.79 64.71 67.74

LT -I Residential Three phase - - -

0-100 195.17 200.36 205.75

101-300 286.17 287.09 288.04

301-500 151.06 156.39 161.93

501 and above 246.92 257.60 268.66

LT II (a) - 0-20 kW 1,343.51 1,412.06 1,483.80

LT II (b) - 20-50 kW 141.20 150.00 159.23

LT II (c) - above 50 kW 233.99 253.45 274.34

LT III - LT Industrial upto 20 kW 123.65 127.36 131.18

LT IV - LT Industrial above 20 kW 191.30 198.44 205.81

LT-V : LT- Advertisements and Hoardings 3.23 3.40 3.59

LT VI: LT -Street Lights 57.73 58.96 60.23

LT-VII (A): LT -Temporary Supply Religious 1.04 1.08 1.12

LT-VII (B): LT -Temporary Supply Others 94.93 98.26 101.70

LT VIII: LT - Crematorium & Burial Grounds 0.88 0.90 0.94

LT IX: LT -Agriculture 0.04 0.04 0.05

Total- LT Sales 6,211.67 6,345.36 6,485.21

HT I: HT-Industry 83.30 85.37 87.49

HTII : HT- Commercial 214.25 274.59 341.21

HT III: HT-Group Housing Society 22.49 22.96 23.45

HTIV : HT - Temporary Supply 4.17 4.25 4.34

HT - Railways (New Category) 57.80 57.80 78.40

Total - HT Sales 382.00 444.97 534.88

Total 6,593.68 6,790.34 7,020.09

3.1.6.4 For the purpose of estimation of Changeover Sales, the Commission has considered

same Changeover sales as approved in Order in Case 179 of 2011 in the matter of

approval of ARR and Multi Year tariff of TPC-D for the second Control Period as

tabulated below:


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Table 9: Changeover Sales approved by the Commission in Case 179 of 2011 (in MU)

Category FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

LT 1 - Residential 1035.66 1136.46 1338.06 1539.66

LT II – Commercial 1006.48 1070.69 1139.01 1211.69

LT – Industrial 405.76 408.93 412.12 415.34

LT VII - Temporary Supply 0.88 0.88 0.88 0.88

LTV- Advertisement 0.18 0.18 0.18 0.18

HT I – Industrial 287.23 307.08 328.31 351.00

HT II – Commercial 574.66 605.55 638.10 672.40

HT III - Group Housing Society 17.12 17.12 17.12 17.12

HT VI - Temporary Supply 0.18 0.18 0.18 0.18

Grand Total 3328.14 3547.07 3873.95 4208.44

3.1.6.5 The same Changeover sales has to be approved by the Commission at the

distribution periphery of RInfra-D for RInfra-D for the period FY 2012-13 to FY

2015-16, as both the sales figures have to be identical and no variation is acceptable.

3.2 Distribution Losses

3.2.1 Distribution Losses for period from FY 2012-13 to FY 2015-16

3.2.1.1 RInfra-D submitted in its MYT Petition that actual distribution loss for FY 2011-12

as mentioned in the True-up Petition in Case No. 124 of 2012 is 9.46% compared to

9.05% considered in the Business Plan Petition. In the Business plan Petition for the

second control period of RInfra-D the distribution loss for FY 2011-12 was

provisional and was considered equivalent to the loss level of FY 2010-11 as the

energy balancing under FBSM was held up since August 2011 on account of

various constraints and issues.

3.2.1.2 RInfra-D further submitted that the actual distribution loss of FY 2011-12 of 9.46%

is higher than those considered in the Business Plan of 9.05% for the same period.

This is on account of the issues in accounting of changeover sales such as:

a) Large number of unbilled consumers by TPC-D.

b) No proper data sharing between RInfra-D and TPC-D and settlement of


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difference in readings.

c) Mismatch in reading cycles for several types of consumers between the two

licensees and issues relating to multiplying factors.

3.2.1.3 RInfra-D submitted that it has considered the actual loss level for FY 2011-12 as the

base level for the MYT Period. Further, for the purpose of estimation of Aggregate

Revenue Requirement and Tariff for the second MYT Control Period, no reduction

in losses of 9.46% is anticipated till FY 2013-14 but losses shall reduce by 0.05% in

the last two years to reach 9.36% in FY 2015-16.

3.2.1.4 RInfra-D further submitted status of the Commission’s direction in Case No. 180 of

2011 regarding carrying out a study of technical losses in RInfra-D system. RInfra-

D submitted that it has awarded the assignment of technical loss study to the

Administrative Staff College of India (ASCI) and was carrying out the study till

May 2013. However, the study is submitted to the Commission on 29 May, 2013.

Since distribution loss is one of efficiency parameter and the study report and its

findings were not made available before the Public consultation process and hence,

it is presently not considered by the Commission in this Order. RInfra-D may

submit the report along with proper justification at the time of mid-term

performance review for the consideration of the Commission.

3.2.1.5 The detailed computation for distribution loss for FY 2011-12, as submitted by

RInfra-D in the True-up petition in Case No. 124 of 2012 is as given in the table

below:

Table 10: Actual Distribution Loss of FY12 as submitted by RInfra-D

Particulars FY 2011-12

Energy sold - RInfra-D own consumers (MU) 6,386.93

Energy consumption by Open Access consumers (MU) 8 .66

Energy sold – Changeover consumers (MU) 2,654.73

Total (MU) 9,050.33

Distribution loss (%) 9.46%

T<>D Energy input (MU) 9,995.79


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3.2.1.6 The Distribution loss trajectory as submitted by RInfra-D for second Control Period

in its MYT Petition is as given in the table below:

Table 11: Distribution Loss Trajectory as submitted by RInfra-D for the 2nd

Control

Period

Loss Levels FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Distribution Loss 9.46% 9.46% 9.41% 9.36%

3.2.1.7 In reply to the Commission’s query regarding reduction of 0.05% in the Distribution

loss in the last two years, RInfra-D submitted vide its reply dated 12 February, 2013

that there could likely be an increase in the loss levels considering that the mix of

consumers served on the network could worsen as more change-over consumers opt

for conversion to Group III (switchover to TPC-D network). However, this effect

could be offset in the later years of the MYT Petition as a result of Capex

interventions as well the fact that new consumers added to RInfra-D network could

balance the degradation in the consumer mix. Therefore, a moderate reduction in

distribution losses has been forecast in the last two years of the MYT Period.


3.2.2.1 The Commission in its Order dated 23 November 2012 in Case No. 158 of 2011 has

approved a distribution loss reduction trajectory as under:

Table 12: Distribution Loss reduction trajectory approved by the Commission in Case No.

158 of 2011

Year wise FY2012-13 FY2013-14 FY2014-15 FY2015-16

Distribution Loss

reduction Trajectory 0% 0% 0.05% 0.05%

3.2.2.2 The Commission in its Order dated 23 November, 2012 in Case No. 158 of 2011

has approved distribution loss of FY 2012-13 as 9.05% based on actual distribution

loss of FY 2010-11, as at the time of issuance of the Order, the actuals of FY 2011-

12 were not available.


Page 61 of 302

3.2.2.3 Subsequently, the Commission in its Order dated 4 April 2013 in Case No. 124 of

2012 has approved distribution loss of FY 2011-12 as 9.46 % based on actual

distribution loss.

3.2.2.4 Hence, the Commission in the present Order has considered the actual distribution

loss of FY 2011-12 as base for approving the distribution loss for the second

Control Period as under:

Table 13: Distribution Loss Trajectory approved by the Commission for the 2nd

Control

Period

Year wise FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Distribution Loss

Target 9.46% 9.46% 9.41% 9.36%

3.3 Energy Balance and Power Purchase Requirement

3.3.1 Energy Balance from FY 2012-13 to FY 2015-16

3.3.1.1 RInfra-D submitted that the energy balance and power purchase forecast is prepared

considering the view of the Commission in its Order in Case No. 180 of 2011, i.e.,

the wheeling losses for LT are considered at 9% and that for HT at 1.94% for all the

years in the second Control Period, as a part of its MYT Petition.

3.3.1.2 As a part of data gaps, the Commission enquired about the impact of RInfra-D

contention in Appeal No. 160 of 2012, i.e., impact of all distribution losses i.e.,

technical and commercial losses to its Own and Wheeling Consumers. In reply,

RInfra-D submitted the impact for FY 2009-10, FY 2010-11 and FY 2011-12 as

given in the table below:

Table 14: Impact of Appeal No. 160 of 2012 as submitted by RInfra-D (in Rs. Cr)

Impact Summary FY

2009-10

FY

2010-11

FY

2011-12

Impact on own consumers due to additional power

purchase / lower increment to the Imbalance Pool 2.00 6.50 11.25

Impact on own consumers due to lower recovery of

wheeling charges from change-over consumers 0.26 0.92 3.06


Page 62 of 302

Impact Summary FY

2009-10

FY

2010-11

FY

2011-12

Total 2.25 7.43 14.31

Cumulative Total 23.98

3.3.1.3 RInfra-D submitted that for FY 2011-12 it has considered transmission losses at

actuals. Further, from, FY 2012-13 onwards, the transmission losses are projected at

4.85% as considered by Commission in the Business Plan Order in Case No. 158 of

2011.

3.3.1.4 RInfra-D submitted the Energy Balance and Power Purchase requirement for the

Second Control Period as given in the table below:

Table 15: Energy Balance for Second Control Period (MU) as submitted by RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Sales (Own) 6,346.36 6,593.68 6,790.34 7,020.09

Sales (changeover) 3,076.30 1,566.50 526.07 548.76

Total 9,422.66 8,160.17 7,316.40 7,568.84

Distribution Loss (%) 9.46% 9.46% 9.41% 9.36%

Energy Input to the Distribution System 10,407.18 9,012.78 8,076.39 8,350.45

Table 16: Power purchase requirement for second Control Period (MU) as submitted by

RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Migrated HT sales 858.21 460.84 200.71 204.72

HT Loss (%) 1.94% 1.94% 1.94% 1.94%

HT grossed up energy at T-D boundary 875.19 469.95 204.68 208.77

Migrated LT sale 2,218.09 1,105.66 325.36 344.03

LT loss (%) 9.00% 9.00% 9.00% 9.00%

LT grossed up energy at T-D boundary 2,437.46 1,215.01 357.53 378.06

Total T-D energy attributable to Migration 3,312.65 1,684.97 562.21 586.83


Page 63 of 302

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Net T-D energy attributable to RInfra-D sale 7,094.53 7,327.82 7,514.18 7,763.61

InSTS losses (%) 4.85% 4.85% 4.85% 4.85%

Total power requirement of RInfra-D 7,456.15 7,701.33 7,897.19 8,159.34


3.3.2.1 The Commission has approved the energy balance and power purchase considering

the wheeling losses for LT are considered at 9% and that for HT at 1.94% for all the

years in the second Control Period, as submitted by RInfra-D in its MYT Petition.

3.3.2.2 Further, the Commission has observed that the transmission loss trajectory since

past few years has been decreasing. The Transmission loss trajectory for past few

years as available on MSLDC website is shown in the following Table:

Table 17: InSTS Transmission Losses as per MSLDC website (%)

Particulars FY

2008-09

FY

2009-10

FY

2010-11

FY

2011-12

FY

2012-13*

Transmission Losses 4.88% 4.59% 4.31% 4.17% 4.19%

*Up to December 2012

3.3.2.3 As evident from the above Table, Transmission losses have been decreasing and

hence, the Commission finds no merit in approving the Power Purchase requirement

at G <> T interface with the same transmission loss as approved in the past and

subsequently having to change the same at the time of Truing-Up. Further,

considering that a higher transmission loss level will result in over-estimating the

energy requirement and increase the burden on the consumers, for the purpose of

this Order, the Commission has considered Transmission losses at 4.17% (actuals

for FY 2011-12) for each year of the Control Period


Page 64 of 302

3.3.2.4 The Energy Balance and Power Purchase requirement for the period from FY 2013-

14 to FY 2015-16, approved by the Commission, is as under:

Table 18: Energy Balance approved by the Commission (MU)

Particulars FY 2013-14 FY 2014-15 FY 2015-16

Sales (Own) 6,594 6,790 7,020

Sales (changeover) 3,293 3,595 3,903

Total 9,887 10,385 10,923

Distribution Loss (%) 9.46% 9.41% 9.36%

Energy Input to the Distribution System 10920 11464 12051

Table 19: Energy Requirement approved by the Commission (MU)

Particulars UoM FY 13-14 FY 14-15 FY 15-16

Energy Input to the Distribution System MU 10920 11464 12051

Changeover HT sales MU 912 965 1021

HT Wheeling Loss % 1.94% 1.94% 1.94%

Changeover HT sales grossed up to at

Distribution Periphery MU 930 984 1041

Changeover LT sales MU 2382 2630 2883

LT Wheeling Loss % 9.00% 9.00% 9.00%

Changeover LT sales grossed up to at

Distribution Periphery MU 2617 2890 3168

Total T-D energy attributable to

Changeover Sales MU 3547 3874 4208

Net energy attributable to RInfra-D retail

sales at Distribution Periphery MU 7373 7590 7843

InSTS losses % % 4.17% 4.17% 4.17%

Total Power Purchase Requirement of

RInfra-D (MU) at Transmission periphery MU 7694 7920 8184

3.4 Power Procurement Plan and Expenses


Page 65 of 302

3.4.1 Estimation of Base and Peak Load

3.4.1.1 RInfra-D submitted that it has forecasted Base Load and Peak Load in MW on the

basis of its sales forecast and energy input requirement at the G<>T boundary.

Using the energy input at G<>T in MU forecast in the Business Plan, the same is

converted to average demand in MW. The Maximum demand corresponding to

RInfra-D customers is then obtained by applying a representative system load factor

to the average demand. The load factor for the period from FY 2012-13 to FY 2015-

16 is estimated based on the average of the load factors for the five year period from

FY 2006-07 to FY 2011-12.

Base Load is considered as the lowest requirement as per the Load Duration Curve

or it could be considered as the load, which is incident on the system for majority of

time. However, RInfra-D submitted that its load duration curve varies significantly

between day and night hours and over seasons. For instance in FY 2011-12, in

winters, load goes down to as low as 350-400 MW in late night hours, whereas in

peak summers, minimum load would hover around 900 MW. Monsoon season

requirement is in between the two. Hence, there is no single Base Load or Peak

Load value for RInfra-D’s system.

3.4.1.2 RInfra-D further submitted that the varying nature of load during the day time and

across different seasons poses difficulty in planning the supply side (Generation) to

meet the demand with assured availability and optimum cost. Further there are large

variations in the short term power rates which in turn may result in the increase in

the power purchase cost.

3.4.1.3 RInfra-D submitted that it has to plan the power purchase such that Consumers of

Mumbai are assured of continuous supply, the surplus and shortfall will be

manageable during the real time operation period and the entire operation is cost

effective.

3.4.1.4 Base Load Generation Capacity assures the reliable and Continuous availability of

supply. RInfra-D submitted that it has done an analysis of the surplus and shortfall

based on the Generation capacity for various levels to meet the requirement for FY

2014-15.


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3.4.1.5 RInfra-D submitted that from the above figure that the surplus/shortfall position is

optimal i.e., @ 68% if the capacity is contracted around the average load. Therefore

RInfra-D has considered the average Load as the Base Load for arriving at the Base

Load Capacity requirement for each year of the MYT Period in its Petition. Further,

RInfra-D has considered 85% of assured availability from the generators.

3.4.1.6 The corresponding Base and Peak Load for the control period as submitted by

RInfra-D is as given in the table below:

Table 20: Base and Peak Load Estimation and additional capacity requirement for

Second control period (MU) as submitted by RInfra-D


Power Purchase requirement

(MU) 7456.15 7701.33 7897.19 8159.34

System Load Factor (%) 68% 68% 68% 68%

Peak Demand (MW) 1251.7 1292.86 1325.74 1369.75

Average Demand (MW)

=Base Demand (MW)) 851.16 879.15 901.51 931.43

DTPS Capacity 467# 451* 451* 451*

Additional Capacity

requirement (MW) –(Base

Demand – Base capacity

contracted)

384

(met through

contracts of

WPCL,AMENPL

and VIPL)

428

(met through

contracts of

WPCL,

AMENPL

and VIPL)

451 481

Capacity to be contracted,

considering 85% availability - - 530 566

# As per RInfra-G MYT Petition (Case No. 1 of 2013) – actual energy as per the Petition

converted to equivalent MW

*After subtracting normative auxiliary consumption of 8.5%, plus actual of FGD as projected in

MYT Petition of RInfra-G (Case No. 1 of 2013)

3.4.1.7 RInfra-D submitted that the power procurement for meeting base load would be

done through a mix of long-term contracts, and medium-term contracts. RInfra-G’s

Dahanu Thermal Power Station would cater to a part of the base load requirement of

RInfra-D. For the period FY 2013-14, rest of the Base demand would be met

through existing medium -term contracts with Wardha Power Company Limited,


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Abhijeet MADC and VIPL’s Butibori plant. These medium-term contracts are valid

till FY 2013-14.

3.4.1.8 In order to meet the base load requirement from FY 2014-15 onwards, RInfra-D

submitted that it has entered into a long-term contract with VIPL for procurement of

600 MW of power. The plant is located at Butibori, Nagpur. After subtracting

auxiliary consumption, the net availability from VIPL would be approximately 540

MW.

3.4.1.9 RInfra-D further submitted that the requirement over and above the base load i.e.,

the peaking requirements of power would be met through short-term purchases from

the external market as well as separate contracts with traders, Power Exchanges,

merchant and captive power plants as well as inter-utility transfer through the state

imbalance pool. Renewable energy will also be procured to meet Renewable

Purchase Obligation (RPO) targets as specified by the Commission, while also

adding to purchases made to meet base and peak load requirements. Renewable

energy from Solar has been considered by RInfra-D towards meeting peak load

requirement.

3.4.1.10 Further, in reply to Commission’s query regarding consideration of different System

Load Factor of 68% for Power Procurement Plan in the MYT Petition, while 72%

was considered in the Business Plan, RInfra-D submitted vide its reply dated 12

February, 2013 that its system load factor is about 68.49% considering past few

years’ data and it is only to arrive at Peak Demand from Average Demand.

However, in the MYT Petition, the Base Demand is considered same as Average

Demand and thereafter, demand profiling is done on an hourly basis for each year of

the MYT Control Period to arrive at the short-term power requirement and surplus

power availability at various times of day. In that context, as the Peak Demand is

not being used to derive Base Demand, the value of load factor is not very relevant.

3.4.2 Procurement from Dahanu TPS (DTPS)


Page 68 of 302

3.4.2.1 RInfra-D submitted that RInfra-G’s Dahanu Thermal Power Station shall cater to its

base load requirement. It has entered into a 10-year Power Purchase Arrangement

with generating station at Dahanu (DTPS or RInfra-G). The arrangement has been

approved by the Commission vide its Order in Case No. 8 of 2008. It is a long-term

contract for delivery of all generated energy to RInfra-D from 2 X 250 MW units at

the tariff determined by the Commission for RInfra-G.

3.4.2.2 RInfra-D submitted that for the period from FY 2012-13 to FY 2015-16, the energy

availability and cost of power purchase from DTPS is based on the projections

provided in RInfra-G MYT Petition in Case No. 1 of 2013. The referred Petition of

RInfra-G contains estimated energy availability from DTPS for FY 2012-13 based

on 9 month actuals and thereafter, energy availability has been determined

considering 500 MW installed capacity, projected auxiliary consumption and

95.90% availability.

3.4.2.3 The summary of the energy availability and cost of power purchase from DTPS as

submitted by RInfra-D is given in the tables below:

Table 21: Energy Availability from DTPS as submitted by RInfra-D

DTPS FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Capacity available (MW) 500 500 500 500

Availability (%) 95.89 95.9 95.9 95.9

Auxiliary Consumption (%) 9.79 9.83 9.83 9.82

Energy availability (MU) 3997.37 3787.6 3787.6 3,798.13*

*One day extra generation due to leap year

Table 22: Cost of Power Purchase from DTPS as submitted by RInfra-D

DTPS FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Fixed Charges (Rs. Crore) 216.61 436.43 328.79 344.92

Rate of Energy Charges (Rs. per kWh) 2.72 2.87 2.93 2.98

Total Variable Cost (Rs. Crore) 1,087.06 1,088.59 1,109.10 1,133.63

Total Cost of Power (Rs. Crore) 1,303.67 1,525.02 1,437.90 1,478.55


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3.4.2.4 Subsequently, in reply to the details sought regarding the actual power purchase cost

for FY 2012-13, RInfra-D provided the actual power purchase cost from DTPS. The

Commission has considered the actual power purchase cost for FY 2012-13 from

DTPS as submitted by RInfra-D.

3.4.2.5 As regards power purchase from RInfra-G for the period from FY 2013-14 to FY

2015-16, the Commission has considered the net energy available from RInfra-G

and cost of power purchase in accordance with the Commission’s Order dated 13

June, 2013 in Case No. 1 of 2013 in the matter of Petition filed RInfra-G for

approval of ARR and determination of tariff for MYT Second Control Period from

FY 2012-13 to FY 2015-16.

3.4.2.6 The summary of the energy availability and cost of power purchase from DTPS as

approved by the Commission for each year of the MYT Second Control Period is

given in the Table below:

Table 23 Power Purchase from RInfra-G for FY 2012-13 to FY 2015-16

Power purchase from

RInfra-G

Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional Truing

up

Approved Approved Approved

Power Purchase Quantum MU 3,994.95 3,787.60 3,787.60 3,798.13

Power Purchase Cost Rs. Crore 1,370.28 1,309.68 1,400.66 1,449.27

Average Rate Rs./kWh 3.43 3.46 3.70 3.82

3.4.3 Procurement from Medium term Contracts (upto FY 2013-14)

3.4.3.1 RInfra-D submitted that it has existing medium-term power procurements contracts

with Wardha Power (WPCL), Abhijeet MADC and Vidarbha Industries Power

Limited (VIPL).

3.4.3.2 RInfra-D submitted that it has considered power purchase from WPCL in

accordance with specified quantum and at the rate adopted by the Commission’s

Order under Case No.85 of 2011 dated 1 July, 2011.


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3.4.3.3 Further, RInfra-D submitted that it has considered the power purchase from

Abhijeet MADC for the period 1 July, 2011 up to 31 March, 2014 at the rates

adopted by the Commission vide its Order under Case No.84 of 2011 dated 1 July,

2011.

3.4.3.4 In case of power purchase from VIPL, RInfra-D submitted that it has considered

procurement of 134 MW from 1 April, 2012 up to 31 March, 2014 in accordance

with the judgment of the Hon’ble ATE in Appeal No. 106 of 2011.

3.4.3.5 The summary of power purchase from above mentioned sources till FY 2013-14 as

submitted by RInfra-D is given in the table below:

Table 24: Energy availability from Existing Medium Term Contracts (MU) as submitted

by RInfra-D

Source FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Wardha (MW) 260 260

Abhijeet (MW) 55 55 - -

VIPL (MW) 134 134 - -

Wardha (MU) 1,935.96 1,935.96 - -

Abhijeet (MU) 409.53 409.53 - -

VIPL (MU) 997.76 997.76 - -

3.4.3.6 RInfra-D further submitted that WPCL has filed a Petition before the Commission

bearing Case No. 39 of 2012 wherein purported claim of Rs 27.6 Crore has been

made by WPCL on account of Change in Law for the period April 2011 to March

2012 broadly classified under the following four heads:

a) Excise Duty on Coal consumed; Clean Energy Cess on Domestic Coal

consumed

b) VAT on Domestic Coal consumed

c) VAT on LDO and HFO consumed

d) Customs duty on Generation using Imported Coal

e) VAT on Spares consumed.

3.4.3.7 RInfra-D submitted that it has executed PPA with WPCL dated 4 June, 2010, for the

period commencing from 1 April, 2011 to 31 March, 2014 for the Contracted


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Capacity of 260 MW. As per Articles 10.1.1 and 10.2 of PPA, supplier is entitled to

any additional recurring/nonrecurring expenditure by reason of introduction of taxes

which are made applicable which were not contemplated by the supplier at the time

the bid was submitted by the supplier pursuant to which the PPA was entered into.

Such taxes should have been introduced 7 days prior to the Bid Deadline.

3.4.3.8 RInfra-D submitted that it has contended before the Commission that in view of the

provisions in the PPA, it is liable to pay only the non-escalable capacity and energy

charges. Consequently, any liability on RInfra-D by reason of introduction of any

tax would be restricted to such taxes being applicable to the tariff payable by the

Respondent under the PPA so as to restore the Petitioner to the same economic

position as if such taxes/levies had not been levied 7 days prior to the Bid Deadline.

3.4.3.9 The Commission, during the hearing held in the Case No. 39 of 2012 dated 2

November, 2012, directed RInfra-D to immediately make payment of Rs. 10 Crore

and subsequently make payment which is undisputed as per RInfra-D. As against

the total claim of Rs. 27.6 Crore for FY 2011-12, RInfra-D submitted that it has

made payment of Rs. 19.5 Crore as undisputed amount till date. As the payment has

been made in FY 2012-13 and included in the Fuel Adjustment Cost (FAC) of FY

2012-13, RInfra-D has considered the same in the present MYT Petition.

3.4.3.10 RInfra-D submitted that further claim of Rs. 26.7 Crore was raised by WPCL for the

period April 2012 to September 2012, against which RInfra-D has made payment of

Rs 7.23 Crore. This matter is sub-judice before Commission for adjudication and

any future payments will be based on the outcome of Case No. 39 of 2012. RInfra-D

submitted in its MYT Petition that the same liability is expected for the second half

of FY 2012-13. Hence, an additional payment of Rs. 14.46 Crore is considered in

the MYT Petition for FY 2012-13, over and above the payment of Rs. 19.5 Crore

(pertaining to FY 2011-12).

3.4.3.11 RInfra-D submitted that, since power will be off taken from WPCL during FY

2013-14 as well, the same change in law impact will cause an additional liability of

Rs. 14.46 Crore for FY 2013-14 as well. The same is accordingly added to the

power purchase cost of FY 2013-14.


Page 72 of 302

3.4.3.12 As a part of data gaps replies, RInfra-D submitted that it has entered into Medium-

Term PPA with Wardha, Abhijeet and VIPL pursuant to competitive bidding

process undertaken as per guidelines issued by the Ministry of Power, GoI. PPAs

entered into have been approved by the Commission and Tariffs have been adopted

as per Section 63 of the Act.

3.4.3.13 The summary of fixed and variable charges from already existing medium term

contracts till FY 2013-14 as submitted by RInfra-D is as given in the table below:

Table 25: Tariff Rates for Medium term contracts as submitted by RInfra-D

Source FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Fixed Charges (Rs Crore)

Wardha 788.98* 595.25**

Abhijeet 122.9 101.15 - -

VIPL 394.22 368.27 - -

Variable Cost (Rs. per kWh)

Wardha 1.02 1.03 - -

Abhijeet 1.81 1.88 - -

VIPL 1.04 1.44 - -

* includes fixed cost of 755.02 Cr and a charge due to change in law of 33.96 Cr

** includes an additional liability of 14.46 Cr due to change in law

Table 26: Cost of Power Procurement from Medium Term Contracts (Rs. Crore) as

submitted by RInfra-D

Source FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Wardha 986.45 793.68 - -

Abhijeet 197.07 177.94 - -

VIPL 497.78 511.75 - -

3.4.3.1 Subsequently, in reply to the details sought regarding the actual power purchase cost

for FY 2012-13, RInfra-D provided the actual power purchase cost from Wardha,

Abhijeet and VIPL. The Commission has considered the actual power purchase cost

for FY 2012-13 from these sources as submitted by RInfra-D.

3.4.3.2 The Commission noticed that RInfra-D has considered the rates for power purchase

from Wardha Power Company Ltd., Abhijeet MADC Nagpur and VIPL as adopted

by the Commission and accordingly approves the same.


Page 73 of 302

3.4.3.3 The summary of the energy availability and cost of power purchase from Wardha

Power Company Ltd., Abhijeet MADC Nagpur and VIPL as approved by the

Commission for each year of the MYT Second Control Period is given in the Table

below:

Table 27 Power Purchase cost as approved for WPCL, Abhijeet and VIPL

Particulars

Unit WPCL Abhijeet VIPL

Approved

after

Provisional

Truing up

Approved Approved

after

Provisional

Truing up

Approved Approved

after

Provisional

Truing up

Approved

FY 2012-13 FY 2013-14 FY 2012-13 FY 2013-14 FY 2012-13 FY 2013-14

Power Purchase

Quantum MU 2,039.49 1,935.96 441.97 409.53 1,001.05 997.76

Power Purchase

Cost

Rs.

Crore 1,001.85 793.68 204.27 177.94 510.05 511.75

Average Rate Rs./kWh 4.91 4.10 4.62 4.35 5.10 5.13

3.4.4 Procurement from Vidarbha Industries Power Limited (VIPL)

3.4.4.1 RInfra-D submitted that since the existing medium term contracts are applicable till

FY 2013-14, for the period FY 2014-15 onwards, there would be a significant

shortfall in base load supply without additional power procurement. The additional

quantum required in FY 2014-15 is about 530 MW.

3.4.4.2 To meet this shortfall, R-Infra D submitted that it is considering to procure 600 MW

from Vidarbha Industries Power Limited (VIPL) from FY 2014-15 onwards. Net

energy availability from VIPL after subtracting auxiliary consumption would be

about 544 MW. A Petition for approval of Long Term PPA between RInfra

(Mumbai Distribution) and VIPL and determination of Provisional Tariff for VIPL’s

Butibori Plant was submitted on 28 December, 2012 to the Commission bearing

Case No. 2 of 2013.

3.4.4.3 RInfra-D submitted following key reasons for procuring power from VIPL:


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a) Power procurement of the utility has to be from a reliable and competitive source.

b) Tariff proposed by VIPL is in line with that of other cost plus generating stations

that have recently been commissioned and approved by the Commission. Further,

the tariff has also been found to be competitive with Case 1 tariffs discovered in

Maharashtra and more recently in UP.

c) No risk of delay in commencement of supply as the plant is expected to be

commissioned much earlier than the committed date of commencement of supply.

d) Any bid process to procure power by competitive bidding would have a lead time

of 48-60 months, whereas the long-term supply from VIPL would commence

from 1 April, 2014.

e) RInfra has indirect majority ownership of Butibori project. This ownership

structure provides RInfra a greater control over VIPL functioning and secures

stronger contractual commitment on the part of VIPL. Thus reliability of supply

from Butibori project of VIPL will be comparable to that from DTPS. Combined

with DTPS, supply from Butibori ensures reliable and long-term supply and hence

energy security for millions of consumers in RInfra-D license area in Mumbai.

f) VIPL’s offer to RInfra-D for supply under tariff determined by the Commission

under Section 62 of EA, 2003 also ensures that benefit of lower price of power is

transparently passed on to retail consumers. In a domestic coal supply constrained

market, this aspect completely aligns VIPL offer with interests of millions of

RInfra electricity consumers in Mumbai.

3.4.4.4 As regards to the Commission’s query regarding power purchase from VIPL,

RInfra-D replied as given below:

a) On account of absence of any performance track record available for VIPL, the

availability for the station has been projected by RInfra-D in accordance with

MERC MYT Regulations, 2011 i.e., 85% during FY 2014-15 and FY 2015-16.

b) Unit-I synchronisation achieved on 25 June, 2012 and COD achieved dated 4

April, 2013. Further, from Unit-1, no infirm power was purchased by RInfra-D

during trial period during FY 2012-13. However, RInfra-D submitted that VIPL

sold infirm power for the period from31 March, 2013 to 4 April, 2013 to RInfra-

D, for which SLDC has not yet finalised the FBSM because of which no revenue


Page 75 of 302

realisation happened to VIPL.

c) Unit-II synchronisation achieved on 2 January, 2013 and COD is likely to happen

shortly. Further, RInfra-D submitted that it would not be possible to estimate the

generation for Unit-II during trial period.

d) Annual Fixed Charges is Rs. 891.04 Crore and Rs. 876.92 Crore for FY 2014-15

and FY 2015-16 respectively for installed capacity of 600 MW.

e) Energy Charge is Rs. 1.22/kWh and Rs. 1.30/kWh for FY 2014-15 and FY 2015-

16 respectively.

3.4.4.5 The summary of Power Purchase from VIPL’s Butibori Plant for FY 2014-15 and

FY 2015-16 as submitted by RInfra-D is given in the table below:

Table 28: Power purchase quantum from VIPL for FY 15 & FY 16 as submitted by

RInfra-D

Source FY 2014-15 FY 2015-16

Capacity available (MW) 600 600

Availability (%) 85% 85%

Auxiliary Consumption (%) 9.40% 9.40%

VIPL 4,047.82 4,058.91*

*One day extra generation due to leap year

Table 29: Power Procurement Cost from VIPL for FY 15 & FY 16 as submitted by

RInfra-D

Source FY 2014-15 FY 2015-16

Capacity charge (Rs Cr.) 891.04 876.92

Energy Charge( Rs per kWh) 1.22 1.3

Total Cost (Rs Cr.) 1384.87 1404.58

3.4.4.6 As regards the procurement of power from VIPL’s Butibori Plant for FY 2014-15

and FY 2015-16, the Commission in its Order dated 23 February, 2013 in Case No.

02 of 2013 stipulated as under:

“In view of the above, the Commission hereby accords its in-principle approval to

the Power Purchase Agreement (PPA) between RInfra-D and VIPL for


Page 76 of 302

procurement of 300 MW power on long-term basis from Unit 2 (IPP) of VIPL’s

Power Station as submitted by the Petitioner on 15 February, 2013 with

modifications to be made in the PPA as per the directions given by the

Commission in Para 44 of the Order. The Commission directs the Petitioners to

submit the final PPA executed between RInfra-D and VIPL for procurement of

300 MW power on long-term basis from Unit 2 of VIPL’s Power Station after

incorporating the above-stated modifications, as compliance of this order within

one month from the date of this Order.”

3.4.4.7 In accordance with the decision of the Commission for in-principle approval of PPA

for 300 MW Unit-2 on long-term basis, the Commission has considered the

procurement of power from Unit-2 for the period from FY 2014-15 to FY 2015-16.

As regards the purchase rate for power from VIPL, the Commission in the said

Order ruled as under:

“the Commission is prima facie of the view that the PPA between RInfra-

D and VIPL with tariff to be determined by the Commission in accordance

with the MERC MYT Regulations, on Cost plus basis by applying critical

prudence checks while examining the tariff proposal, will help RInfra-D to

meet the energy requirement of its consumers. As the PPA between RInfra-

D and VIPL provides for determination of tariff in accordance with MERC

MYT Regulations, the Petition submitted by RInfra-D and VIPL for

approval of PPA complies with Regulation 25.2 (c) of MERC MYT

Regulations, 2011.”

3.4.4.8 Accordingly, the Commission has provisionally considered the rate of power

purchase from VIPL Unit-2 based on the rates as submitted by RInfra-D since the

approval of final tariff for VIPL is yet to be accorded.

3.4.4.9 As regards the procurement of power from Unit-1 of VIPL, the Commission in the

above mentioned Order ruled as under:

“During the hearing before the Commission Shri. Bushan Gagrani, CEO

of MIDC, referred to an MOU for setting up of a 130 MW Group Captive


Page 77 of 302

Power Project (subsequently converted into a 300 MW GCPP). He has

also submitted that the MIDC Board is in the process of obtaining a legal

opinion in regard to the conversion of Unit 1 from Group Captive Power

Plant to Independent Power Project, in view of the bid conditions. This

Commission has not been called upon, through the present Petition, to

decide the issue of conversion of Unit 1 from a Group Captive Power

Plant to an Independent Power Project. Hence, according approval of

sale of power from Unit 1 to RInfra-D, may amount to changing the

character of the power plant from a Group Captive Power Plant to an

Independent Power Project. During the hearing, it was submitted on

behalf of the Petitioners that approval may be given only Case No. 02 of

2013 to the PPA pertaining to Unit 2 in view of the pendency of the

approval of conversion of Unit 1 from GCPP to IPP. Considering these

facts and submissions made by MIDC and the Petitioners regarding

conversion of Unit 1 from GCPP to IPP, the Commission has, at this

stage, considered the PPA for supply of power from Unit 2 of VIPL to

RInfra-D. The Petitioners may file an appropriate application /Petition

for approval of supply of power from Unit 1 of VIPL to RInfra-D, once

these issues are sorted out.”

3.4.4.10 Subsequently, MIDC vide its letter dated 18 May, 2013 submitted as under:

“In view of the facts and status mentioned in VIPL’s letter dated

18/01/2013, the board item was placed before 349th

Board meeting of

MIDC held on 08/02/2013. In the meeting it was decided to issue

directives to obtain legal opinion and conduct the separate meeting with

industries/industry associations to participate under GCPP.

The said meeting with industries/industry associations to participate in

GCPP was conducted on 22/05/2013 in which industries have expressed

their unwillingness to participate at this juncture as according to them

participation in GCPP is not attractive and workable in present scenario.

On obtaining the legal opinion and conclusion of meeting dated

22/05/2013 with industries/industry associations, the issue was discussed


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in 351st Board Meeting held on 24/05/2013. The Board has accorded its

approval for conversion of 300 MW GCPP into an IPP.”

3.4.4.11 Considering the fact that MIDC has submitted that its Board has accorded its

approval for conversion of 300 MW GCPP into an IPP, the Commission has

considered the purchase of power by RInfra-D from 300 MW Unit-1 for FY 2014-

15 to FY 2015-16, for the purpose of estimation of Power Purchase availability.

Further, the Commission has provisionally considered the rate of power purchase

from VIPL Unit-1 based on the rates as submitted by RInfra-D, on ad-hoc basis,

subject to final approval by the Commission.

3.4.4.12 The summary of the energy availability and cost of power purchase from both Units

of VIPL as submitted by RInfra-D and approved by the Commission for each year

of the MYT Second Control Period is given in the Table below:

Table 30 Power Purchase from VIPL for FY 2014-15 to FY 2015-16

Power purchase

from VIPL

Unit FY 2014-15 FY 2015-16

RInfra-D Approved RInfra-D Approved

Power Purchase Quantum MU 4,047.82 4,047.82 4,058.91 4,058.91

Power Purchase Cost Rs. Crore 1,384.87 1,384.87 1,404.58 1,404.58


3.4.5 Procurement from Renewable Sources

3.4.5.1 RInfra-D submitted that the quantum of the renewable energy purchased to meet the

Renewable Purchase Obligations (RPO), is in line with the MERC (Renewable

Purchase Obligation, Its Compliance and Implementation of REC Framework)

Regulations, 2010, which specifies the following percentage of minimum purchases

from renewable energy:

“7.1 Every “Obligated Entity” shall procure electricity generated from

eligible renewable energy sources at the percentages as per the following

schedule:


Page 79 of 302

Year

Minimum Quantum of purchase (in %) from

renewable energy sources (in terms of energy

equivalent in kWh)

Solar Non- Solar

(other RE)

Total

2010-11 0.25% 5.75% 6.0%

2011-12 0.25% 6.75% 7.0%

2012-13 0.25% 7.75% 8.0%

2013-14 0.50% 8.50% 9.0%

2014-15 0.50% 8.50% 9.0%

2015-16 0.50% 8.50% 9.0%

Provided that Distribution Licensee(s) shall meet 0.1% per year of its Non

Solar including mini and micro hydro (other RE) RPO obligation for the

period from FY 2010-11 to FY 2012-13 and up to 0.2% of its Non Solar

(other RE) RPO obligation for the period from FY 2013-14 to FY 2015-16

by way of purchase from Mini Hydro or Micro Hydro power project.”

3.4.5.2 Based on the above mentioned Regulations, RInfra-D submitted its Solar Purchase

requirement from FY 2012-13 to FY 2015-16 as given in the table below:

Table 31: Solar RPO requirement as submitted by RInfra-D


Gross Input (MU) 7,456.15 7,701.33 7,897.19 8,159.34

Solar RPO (%) 0.25% 0.50% 0.50% 0.50%

Solar Obligation (MU) 18.64 38.51 39.49 40.80

3.4.5.3 RInfra-D further submitted that it has considered the impact of the Order in Case

No. 101 of 2012 in which the Commission directed RInfra-D as:

“RInfra-D is directed to fulfil its RPO target for Solar and Non-Solar

RPO for FY 2010-11, FY 2011-12 and FY 2012-13 cumulatively before 31

March, 2013.”

3.4.5.4 RInfra-D submitted the shortfall in Solar RPO compliance in FY 2010-11 and FY

2011-12 as under:


Page 80 of 302

Table 32: Cumulative Shortfall in Solar RPO in FY 11 and FY 12 as submitted by

RInfra-D

Financial

Year

Gross Input

(As per Final

True-Up

Petition) (MU)

Solar

RPO

Target

(%)

Solar RPO

Target

(MU)

Actual

Procurement

(including

Solar REC)

(MU)

Shortf

all

(MU)

FY 2010-11 8637.48 0.25 21.59 Nil 21.59

FY 2011-12 7524.02 0.25 18.81 0.46 18.35

Cumulative

Shortfall 39.94

3.4.5.5 RInfra-D submitted that in order to meet its Solar Renewable purchase obligations,

it has signed an Energy Purchase Agreement (EPA), dated 28 March, 2011, for

purchase of energy generated from the 40 MW solar power (PV) plant of Dahanu

Solar Power Private Limited (DSPPL). The plant is located in Rajasthan with

delivery point at Maharashtra State periphery. The delivered tariff is estimated as

per Tariffs approved by the Commission in its Order in Case No. 20 of 2010.

3.4.5.6 As per the Commission’s query regarding difference in projected purchase of 60

MU of Solar Power per year for the MYT period from DSPPL’s 40 MW Solar

power plant, while in the Business Plan, it was projected as 42 MU per year, RInfra-

D submitted vide its reply dated 12 February, 2013 that in the Business Plan petition

RInfra-D indicated that the likely generation from FY 2012-13 onwards from the

plant would be 60 MU. However, as the same would lead to excess procurement

over target from FY 2013-14 onwards, RInfra-D had, for the purposes of the

Business Plan, projected the procurement to 42 MU per annum from FY 2013

onwards so as to cumulatively meet the target of solar RPO from FY 2011 to FY

2016. Further, RInfra-D confirmed that the plant is capable to generate

approximately 60 MU on an annual basis and provided actual month-wise

generation till December 2012 as given below:


Page 81 of 302

Table 33: Actual month-wise generation from DSSPL as submitted by RInfra-D

Month Actual Generation

(in MU)

April 2012 3.17

May2012 5.10

June 2012 4.90

July 2012 4.84

August 2012 3.61

September 2012 4.79

October 2012 6.35

November 2012 3.72

December 2012 5.37

Total 41.86

Table 34: Solar Power Cost Summary as submitted by RInfra-D for the second Control

Period

Solar Power Cost FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Solar Purchase from DSPPL (MU) 60.00 60.00 60.00 60.16

Solar Tariff (Rs. per kWh) 17.91 17.91 17.91 17.91

Solar Power purchase cost (Rs Cr.) 107.46 107.46 107.46 107.75

Solar Obligation including shortfall (MU) 58.22 38.51 39.49 40.80

Solar Shortfall in previous years (MU)

Deficit/(Surplus) (MU) (1.78) (21.49) (20.51) (19.36)

3.4.5.7 Further, RInfra-D submitted that for the period from FY 2012-13 to 2015-16, it is

expected that there will be a surplus in solar power purchase w.r.to, the solar

purchase obligation for the respective year. The surplus is expected to be a result of

the impact of migration of consumers to TPC-D. Due to migration of consumers,

RInfra-D own sales and power purchase requirement is lower than estimated at the

time of contracting with DSPPL. RInfra-D further added that over contracting is

prudent considering uncontrollable events such as increase in sales, reduction in

output due to bad weather or malfunctioning in solar panels, etc.

3.4.5.8 RInfra-D submitted its Non Solar Purchase as per MERC (Renewable Purchase

Obligation, Its Compliance and Implementation of REC Framework) Regulations

2010 requirement from FY 2012-13 to FY 2015-16 as given in the table below:


Page 82 of 302

Table 35: Non Solar Obligation as submitted by RInfra-D (MU)

Non Solar Obligation FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Gross Input (MU) 7,456.15 7,701.33 7,897.19 8,159.34

Non Solar RPO (%) 7.75% 8.50% 8.50% 8.50%

Non Solar Obligation (MU) 577.85 654.61 671.26 693.54

3.4.5.9 RInfra-D further submitted details of its existing Renewable Contracts in order to

meet its Non Solar RPO as given in the tables below:

Table 36: Existing Non Solar Contracts as submitted by RInfra-D (MU)

Existing Non Solar Contracts FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Reliance Innoventures Pvt. Ltd. 90.67 90.67 90.67 90.91

AAA Sons Enterprise 6.80 6.80 6.80 6.82

Jindal Steel and Power Limited 31.54 31.54 31.54 31.62


Tembhu Power Private Limited 8.00 8.00 8.00 8.00

Reliance Clean Power Pvt. Ltd 39.42 78.84 78.84 79.06

Table 37: Power Purchase rate with Existing Non Solar Contracts as submitted by

RInfra-D (Rs/kWh)

Power Purchase Rate FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Reliance Innoventures Pvt. Ltd. 3.95 4.10 4.25 4.40

AAA Sons Enterprise 3.95 4.10 4.25 4.40



Tembhu Power Private Limited 4.26 4.26 4.26 4.26

Reliance Clean Power Pvt. Ltd 5.67 5.67 5.67 5.67

3.4.5.10 RInfra-D submitted that the shortfall in non-solar power purchase requirement

obligation after considering the existing contracts is estimated to be met through

purchase of Renewable Energy Certificates (REC). The purchase price of REC is

established based on the actual purchase of REC for the first six months of FY


Page 83 of 302

2012-13. RInfra-D submitted month-wise details of actual RECs purchased during

FY 2012-13 which amounted to Rs. 90.81 Crore. RInfra-D submitted details of the

estimated REC procurement for the MYT Period as given in the table below:

Table 38: Quantum and Cost of Non- Solar REC procurement as submitted by RInfra-

D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Non- Solar RPO requirement (MU) 577.85 654.61 671.26 693.54

Non-Solar Contracted (MU) 186.93 226.35 226.35 226.95

REC requirement (MU) 460.93 428.26 444.91 466.59

Cost of REC (Rs per kWh) 1.85 1.85 1.85 1.85

Total Cost of REC purchase

(Rs Cr) 85.49 79.43 82.52 86.54

3.4.5.11 Further, in response to the Commission’s query regarding provision in PPA for

applicability of rebate from Renewable Energy Sources (RES) for payment within

the due date, RInfra-D submitted its replies as given in the table below:

Table 39: Discount clause by various RES Generators as submitted by RInfra-D

Seller Discount Clause

AAA Sons Discount of 2% on total bill prompt payment within 10 days from

date of receipt of the bill

Reliance Innoventures No Discount

JSPL Discount of 1.25% on total bill prompt payment within 7 days

from date of receipt of the bill

Tembhu Hydro Discount of 1.25% on total bill prompt payment within 15 days


Reliance Clean Power Discount of 1.25% on total bill prompt payment within 15 days


Dahanu Solar Power Discount of 1.25% on total bill prompt payment within 15 days


3.4.5.12 Further, vide the Business Plan Order in Case No. 158 of 2011, RInfra-D was

directed to submit Accelerated Depreciation details for power purchase from

Reliance Clean Power Pvt. Ltd. as follows:


Page 84 of 302

“.... RInfra-D at the time of filing of MYT Petition, may submit necessary

documentary evidence to ascertain whether this project has availed AD

benefit or not and based on prudence check, the Commission may

consider the same at the finalisation of MYT Order.”

In response to the above direction, RInfra-D submitted that Reliance Clean Power

Pvt. Ltd is yet to declare COD in view of difficulties faced in acquiring land and

infrastructure development and is likely to achieve COD shortly. Further, as per

PPA terms, the seller is required to submit documentary evidences for Accelerated

Depreciation (AD) and Wind Zone within 12 months after completion of the

financial year of COD. Since this project is yet to achieve COD, the AD certificate

has not been provided yet.

3.4.5.13 Subsequently, in reply to the details sought by the Commission for FY 2012-13,

RInfra-D provided the actual power purchase cost from renewable sources including

solar. The Commission has considered the actual power purchase cost for FY 2012-

13 from these sources as submitted by RInfra-D for provisional truing up purpose.

The Commission has provisionally considered the power purchase expenses,

however, the same would be trued up subject to the verification and compliance of

RPO targets for FY 2012-13.

3.4.5.14 As regards the purchase of solar power in excess for RPO targets for the period

from FY 2013-14 onwards, the Commission does not wish to burden the consumers

with undue cost burden estimated approximately as Rs 109.56 Crore for second

Control Period, by allowing the additional solar power purchase over and above cost

pertaining to the minimum quantum of solar power purchase allowed as per MERC

(Renewable Purchase Obligation, its Compliance and Implementation of REC

Framework) Regulations 2010. However, the Commission is allowing the additional

quantum of power at highest rate in merit order stack of power purchase at the

short-term power purchase rates of respective years.

3.4.5.15 The summary of the solar purchase as approved by the Commission is shown in the

Table below:


Page 85 of 302

Table 40 Solar Power Purchase approved by the Commission for the Second

Control Period

Power purchase to

meet Solar RPO

Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional Truing

up


Power Purchase

Quantum MU 60.13 38.47 39.60 40.92

Power Purchase

Cost Rs. Crore 107.69 68.90 70.92 73.29


3.4.5.16 As regards the purchase of non-solar power, the Commission observed that RInfra-

D has projected to purchase RECs to meet the short-fall of non-solar RPO. The

Commission suggests RInfra-D that it should ensure the compliance to the RPO

targets by way of purchase of renewable power or by way of RECs from Power

Exchanges. The summary of the non-solar purchase as approved by the Commission

is shown in the Table below:

Table 41 Non-solar power purchase as approved by the Commission

Power purchase to

meet Non-Solar

RPO

Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional Truing

up


Power Purchase

Quantum MU 136.09 226.35 226.35 226.95

Power Purchase

Cost Rs. Crore 55.79 106.33 108.27 110.49



Page 86 of 302

3.4.5.17 Further, the Commission observed that RInfra-D has also proposed to purchase non-

solar RECs to meet the shortfall of non-solar RPO target for FY 2012-13 to FY

2015-16. In response to query of the Commission regarding actual purchase of

RECs during FY 2012-13, RInfra-D submitted the details of actual purchase of

RECs during FY 2012-13 in the format provided and observed that Trading Margin

shown in the power purchase made from IEX is towards trading margin of trader.

As regards the procurement of RECs from Power Exchanges, it is observed that

Distribution Licensee should have procured directly from the Exchange as the

Exchange platform provides the double-sided undisclosed bidding and therefore in

such case a trader is not expected to provide any additional benefit for procurement

of RECs. Moreover, considering the fact that on account of shortfall to meet RPO,

RECs are being purchase in certificate form, the Commission directs that RInfra-D

should ensure that only the cost associated with market clearing price at the

Exchange and the exchange related fees and charges should be considered in future

and not the trading margin paid to the trader for procurement of RECs. The

Commission further directs RInfra-D to provide the cost benefit analysis and other

associated benefits for purchase of RECs from Power Exchanges.

3.4.5.18 Accordingly, for the purpose of provisional truing up for FY 2012-13, the

Commission has considered the actual purchase of RECs during FY 2012-13.

Further, for the period from FY 2013-14 to FY 2015-16, the Commission has

presently considered the shortfall in non-solar RPO to be met through purchase of

RECs, subject to prudence check. As regards the cost of purchase of RECs, the

Commission has considered the average Market Clearing Price of Rs.

1500/Certificate for past 10 months trade data. Further, the Commission has

considered Rs. 20/Certificate towards the fees of Power Exchanges based on the

actual trade data for FY 2012-13. The summary of the cost of RECs for FY 2012-13

to FY 2015-16 as approved by the Commission is shown in the Table below:


Page 87 of 302

Table 42 Purchase of Non-Solar RECs approved by the Commission for FY 2012-13 to FY

2015-16

Power purchase to

meet Non-Solar RPO

Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional

Truing up


RPO shortfall MU 504.75 427.63 446.86 468.69

Cost of Purchase of REC Rs. Crore 90.81 65.00 67.92 71.24


3.4.6 Short Term bilateral Power Purchases

3.4.6.1 RInfra-D in its MYT Petition has projected the hourly demand and generation

availability from base load sources and determined, on an hourly basis, the surplus

and shortfall in energy terms. The summary of daily load profiling, giving rise to

energy surplus and deficit on an hourly basis for each year of the MYT Period as

submitted by RInfra-D is as given in the table below:

Table 43: Annual Hour wise Deficit and Surplus as submitted by RInfra-D (MU)

Hour FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Deficit Surplus Deficit Surplus Deficit Surplus Deficit Surplus

1.00 25.76 (30.74) 33.77 (21.65) 24.20 (33.32) 29.79 (28.85)

2.00 10.70 (49.20) 15.72 (37.99) 9.66 (54.06) 12.77 (48.50)

3.00 4.29 (61.96) 7.15 (49.22) 3.58 (68.29) 5.39 (62.08)

4.00 1.34 (70.71) 3.36 (57.51) 0.91 (78.00) 1.92 (71.41)

5.00 0.34 (73.85) 1.42 (59.85) 0.20 (81.68) 0.56 (74.57)

6.00 0.10 (70.52) 0.71 (55.96) 0.02 (78.24) 0.16 (70.78)

7.00 0.21 (57.55) 0.69 (42.41) 0.05 (64.39) 0.13 (56.36)

8.00 0.44 (47.67) 1.58 (32.82) 0.33 (53.89) 0.60 (45.64)

9.00 2.07 (27.69) 7.40 (16.28) 1.91 (32.51) 3.68 (24.95)

10.00 8.38 (15.16) 18.24 (7.61) 7.54 (18.09) 12.31 (12.81)

11.00 23.18 (7.96) 37.02 (3.64) 22.10 (9.31) 29.95 (6.34)

12.00 31.51 (6.57) 46.50 (3.06) 30.51 (7.38) 39.50 (5.17)

13.00 29.08 (8.26) 43.27 (4.17) 27.86 (9.14) 36.53 (6.65)

14.00 19.33 (14.22) 30.99 (8.09) 17.70 (15.55) 24.66 (11.96)

15.00 21.52 (15.96) 33.22 (9.87) 20.00 (17.40) 27.05 (13.88)


Page 88 of 302

Hour FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Deficit Surplus Deficit Surplus Deficit Surplus Deficit Surplus

16.00 24.77 (16.46) 36.78 (10.63) 23.26 (17.84) 30.63 (14.57)

17.00 21.92 (17.29) 33.61 (11.29) 20.48 (19.01) 27.46 (15.52)

18.00 18.17 (16.82) 29.41 (10.55) 16.70 (18.84) 23.15 (15.01)

19.00 28.89 (8.83) 42.91 (4.82) 28.18 (10.66) 36.22 (7.91)

20.00 46.62 (1.65) 64.24 (0.44) 46.18 (2.31) 56.73 (1.18)

21.00 52.28 (1.70) 70.04 (0.45) 51.95 (2.15) 62.83 (1.14)

22.00 49.88 (3.42) 66.53 (1.19) 49.27 (3.83) 59.67 (2.51)

23.00 51.01 (6.69) 66.55 (3.43) 49.86 (6.69) 60.01 (5.25)

24.00 42.75 (15.06) 55.32 (9.38) 40.90 (15.35) 49.42 (12.89)

Total 514.53 (645.94) 746.44 (462.32) 493.34 (717.93) 631.09 (615.91)

3.4.6.2 RInfra-D proposed to meet its peak load requirement for the Control Period based

on the time period for which power is to be purchased i.e., weather power is to be

purchased for 9 Hrs to 24 Hrs for the entire month or for few hours during day peak

and evening peak. At times, customised power (i.e., only during peak hours,

matching load profile) is not available in the market and RInfra-D, in order to avoid

load shedding to its customers, has to purchase Round the Clock (RTC) power.

3.4.6.3 Further, RInfra-D submitted that Peak Power requirement for the entire month for

the period 9 Hrs to 24 Hrs would be purchased by inviting short term tender from

Merchant Generators/Traders /IPPs as per Guidelines issued by Ministry of Power

for Short Term Power Purchase. Whereas power required for few hours of the day

would be purchased from Power Exchange at competitive price discovered on

Exchange. Also, RInfra-D submitted that it would explore the possibility of tying up

long-term power from any upcoming hydro power plant in order to meet its peak

power requirement.

3.4.6.4 Further, RInfra-D submitted that in its MYT Petition, no projection of any banking

is made at and the entire surplus power as projected is considered as sold.

3.4.6.5 RInfra-D considered the quantum of short-term power purchase as worked out in the

table above, considering the likely hourly pattern of load for each year of the MYT


Page 89 of 302

Control Period and the base load capacity availability projected considering its

present and proposed contracts with DTPS, WPCL, AMNEPL and VIPL.

3.4.6.6 RInfra-D calculated the base price of short-term power purchase as the actual

weighted average price of the short term power purchased by RInfra-D in FY 2011-

12. Further annual escalation rate of 3% is used to project the price of short term

power purchase from FY 2012-13 to FY 2015-16. The quantum and cost of short

term power purchase as projected by R-Infra D is as given in the table below:

Table 44: Quantum and Rate of Short Term Power procurement as projected by RInfra-D


Short term procurement in

MU 514.53 746.44 493.34 631.09

Short term Power

procurement cost per unit

(FY11-12 value of Rs.

4.47 per kWh escalated

annually at 3%) (Rs/kWh)

4.60 4.74 4.88 5.03

Total short term power

purchase cost (Rs Crore) 236.90 353.98 240.97 317.51

3.4.6.7 RInfra-D submitted that additional surplus energy as worked out using the hourly

load pattern would be utilised by RInfra-D for sale outside the License area, after

fully meeting the demand of its customers. The estimated revenue from the sale of

surplus power is adjusted against the gross power procurement cost. RInfra-D

further submitted that this approach is consistent with the methodology adopted by

the Commission in its Tariff Orders for Maharashtra Utilities, where surplus (if any)

is considered to be sold at the prevailing short-term market rates for power.

3.4.6.8 RInfra-D submitted that the base price for surplus sale is the actual weighted

average price of the surplus sale realised by RInfra-D in FY 2011-12. Further annual

escalation rate of 3% is used to project the rate of sale of surplus power from FY

2012-13 to FY 2015-16. The quantum and cost of surplus power purchase as

projected by R-Infra D is as given in the table below:


Page 90 of 302

Table 45: Quantum and Rate of Surplus Power sale projected by RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Surplus power sale rate

(Rs per kWh) 3.03 3.12 3.21 3.31

Surplus Power (MU) 645.94 462.32 717.93 615.92

Realization from sale of

surplus power (Rs Cr) 195.6 144.2 230.64 203.81

3.4.6.9 As regards the purchase of power from short-term sources, the Commission has

accepted the method for estimating the requirement of power purchase from short-

term sources and accordingly approve the same quantum as proposed by RInfra-D.

As regards the purchase rate for procurement of power on short-term basis, the

Commission has not accepted the rates as considered by RInfra-D. The Commission

observed that RInfra-D has conveniently chosen to consider only purchase from

Power Exchange, however, the weighted average rate for power purchase from

bilateral and power exchange works out to Rs. 4.20/kWh as against Rs. 4.47/kWh as

estimated by RInfra-D summarised as under:

Table 46 Actual short-term Power Purchase during FY 2011-12

Particulars Purchase Quantum Purchase amount Average Rate

MU Rs. Crore Rs./kWh

Bilateral 1,458.13

607.07 *

4.16

Exchange 185.21

82.85

4.47

Weighted Average 4.20 *Note: Penalty of Rs. 98.93 Crore paid to GEPL for no-off take reduced to arrive at realistic purchase cost

3.4.6.10 Further, the Commission is of the view that past trend would not be ideal for

estimating the power purchase rate for short-term power procurement as there has

been gradual shift in the power availability to RInfra-D from medium and long-term

sources and there is expected increased availability with additional long-term

sources. The Commission observed that RInfra-D in the past has been procuring


Page 91 of 302

substantial requirement from short-term sources as evident from the following

Table:

Table 47 Purchase from short-term sources by RInfra-D (MU)

Particulars FY

2010-11

FY

2011-12

FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Actual Actual Actual Estimated Estimated Estimated

Bilateral

2,376.28

1,458.13 8.05

746.44 493.34 631.09

Exchange

611.09

185.21 439.40

Total

2,987.37

1,643.35

447.45

3.4.6.11 It can be observed from the above Table that there has been significant decrease in

the requirement of the short-term purchases as evident from the actual purchase of

447.75 MU during FY 2012-13 and estimated during the Control Period. The

Commission opines that since the actual data for FY 2012-13 is now available, the

Commission has considered the actual power purchase rate for FY 2012-13 for

estimating the power purchase expenses for procurement from short-term sources.

The summary of the estimated power purchase quantum and cost as approved by the

Commission for each year of the Control Period is shown in the Table below:

Table 48 Short-term power purchase approved by the Commission

Power purchase for

short-Term Power

Procurement

Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional

Truing up


Power Purchase Quantum MU 447.45 746.44 493.34 631.09

Power Purchase Cost Rs. Crore 167.98 280.22 185.21 236.92


3.4.6.12 For estimating the revenue from sale of surplus power, the Commission has

considered the rate of Rs 2.50 per kWh for FY 2013-14 and Rs 2.35 per kWh for FY

2014-15 and FY 2015-16 for estimating the revenue from sale of surplus power. The


Page 92 of 302

summary of the estimated sale quantum of surplus power and revenue as approved

by the Commission for each year of the Control Period is shown in the Table below:

Table 49 Sale of surplus power as approved by the Commission for RInfra-D

Sale of Surplus Power Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional

Truing up


Power Purchase Quantum MU 842.34 448.13 674.58 571.94

Power Purchase Cost Rs. Crore 197.70 111.88 158.32 134.23


3.5 Transmission Charges

3.5.1.1 RInfra-D submitted that transmission charges to be borne by it is Rs 265 Crore in

FY 2012-13 as per the Commission’s Order dated 21 May, 2012 in Case No. 51 of

2012.

3.5.1.2 The same has been considered in the MYT Petition for FY 2012-13. From FY 2013-

14 onwards, RInfra-D has escalated transmission tariff determined in the above

Order at the rate of 5% per annum. The intra-state transmission charges considered

by RInfra-D are given in the table below:

Table 50: Transmission Charges for the second Control Period as submitted by RInfra-

D (Rs. Cr)


Transmission Charges 265.39 278.66 292.59 307.22


Page 93 of 302

3.5.1.3 As regards the transmission charges payable by RInfra-D for utilisation of intra-

State Transmission system, the Commission has relied upon the Order dated 13

May, 2013 in Case No. 56 of 2013 issued in the matter of Suo motu Determination

of Transmission Tariff for Intra-State Transmission System (InSTS) for FY 2013-14

to FY 2015-16 of the second MYT Control Period. Accordingly, the Commission

has considered the annual transmission charges as approved in the said Order,

summarised as under:

Table 51 Transmission Charges payable by RInfra-D as approved by the Commission

Transmission Charges Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional

Truing up


Intra-State Transmission

Charges Rs. Crore 265.39 428.11 390.27 453.23

3.6 Stand-by Charges

3.6.1.1 RInfra-D submitted that the Commission has determined the Standby charges in its

Business Plan Order in Case No. 158 of 2011 dated 23 November, 2012 as 143.70

Crore for each year of the MYT Period.

3.6.1.2 RInfra-D submitted that in FY 2012-13 however, it is paying Rs. 212.45 Crore as

the Standby Charges as approved by the Commission in its order in Case No. 126 of

2011. As the MYT Order is only expected to be effective from FY 2013-14

onwards, the excess stand-by charges paid during FY 2012-13 can be adjusted in FY

2013-14. Accordingly, RInfra-D submitted that it has made adjustment in the

projected stand-by charges of FY 2013-14 in the MYT Petition.

3.6.1.3 Further, it was submitted by RInfra-D that in its Petition in Case No. 124 of 2012,

RInfra-D had mentioned that it paid an excess charge of Rs. 8.61 Crore in FY 2012-

13 for stand-by support due to incorrect representation of RInfra-D’s share in the

Commission’s Order in Case No. 180 of 2011. This excess payment has also been

adjusted in the projected stand-by charges of FY 2013-14 in the present MYT

Petition. From FY 2014-15 onwards a payment of standby charges of Rs. 143.70


Page 94 of 302

Crore is considered as determined by the Commission in the Business Plan Order in

Case No. 158 of 2011 dated 23 November, 2012. The year wise projection of

standby charges as submitted by RInfra-D is given in the table below:

Table 52: Standby Charges for the second Control Period as submitted by RInfra-D

(Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Standby charges (Business Plan Order) 143.70 143.70 143.70 143.70

Actual Paid 221.06 - - -

Past Period adjustment of excess payment - 77.36 - -

Standby Charges 221.06 66.34 143.70 143.70

3.6.1.4 As regard the estimation of standby charges for the MYT Control Period the

Commission has considered the % share of Coincident Peak Demand and Non-

coincident Peak Demand as approved in the Order in Case No. 56 of 2013 for the

period from FY 2013-14 to FY 2015-16. Further, the Commission has considered

the adjustments towards excess charge of Rs. 8.61 Crore in FY 2012-13 for stand-by

support. This excess payment has also been adjusted in the approved stand-by

charges of FY 2013-14 summarised as under:

Table 53 Standby Charges as approved by the Commission for RInfra-D

Standby Charges Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional Truing

up


Standby Charges Rs. Crore 143.7 137.00 137.00 137.00

Actual Paid Rs. Crore 221.06

Past Period adjustment

of excess payment Rs. Crore - 77.36

Standby Charges Rs. Crore 221.06 59.64 137.00 137.00


Page 95 of 302

3.7 SLDC Charges

3.7.1.1 RInfra-D submitted that the Commission has determined the SLDC charges in

Order dated 30 March, 2012 in Case No.181 of 2011 for FY 2012-13.

3.7.1.2 The same has been considered in the MYT Petition for FY 2012-13. From FY 2013-

14 onwards, RInfra-D has escalated SLDC Charges determined in the above Order

at the rate of 5% per annum. The SLDC Charges considered by RInfra-D is given in

the table below:

Table 54: SLDC Charges for the second Control Period as submitted by RInfra-D

(Rs. Cr)


SLDC Charges 1.05 1.1 1.16 1.22

3.7.1.3 As regards the SLDC charges payable by RInfra-D, the Commission has relied upon

the Order dated 22 March, 2013 in Case No. 133 of 2012 issued in the matter of

Petition filed by MSETCL for approval of MSLDC Budget for FY 2013-14.

Accordingly, the Commission has considered share of RInfra-D out of the approved

Budget for MSLDC for FY 2013-14. Further, the Commission has considered the

same value for each year of the Control Period summarised as under:

Table 55: SLDC Fees and Charges as approved by the Commission for RInfra-D

SLDC Fees and

Charges

Unit FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Approved after

Provisional Truing

up


SLDC Fees and

Charges Rs. Crore 1.05 1.64 1.64 1.64

3.7.1.4 The Summary of Power Purchase Quantum and Cost is as given in the tables below:

Table 56: Summary of Power Purchase requirement as submitted by RInfra-D (MU)


Energy Requirement 7456.15 7701.33 7897.19 8159.34

Long Term


Page 96 of 302


DTPS 3997.37 3787.60 3787.60 3798.13

Medium Term

Wardha Power 1935.96 1935.96 - -

Abhijeet MADC 409.53 409.53 - -

VIPL 997.76 997.76 - -

VIPL (Long Term) - - 4047.82 4058.91

Renewable 246.93 286.35 286.35 287.12

Short term purchase 514.53 746.44 493.34 631.09

Total 8102.09 8163.65 8615.12 8775.26

Deficit/(Surplus) (645.94) (462.32) (717.93) (615.92)

Table 57: Summary of Power Purchase Cost as submitted by RInfra-D (Rs. Cr)


DTPS 1303.67 1525.02 1437.90 1478.55

Wardha Power 986.45 793.68 - -

Abhijeet MADC 197.07 177.94 - -

VIPL 497.78 511.75 - -

VIPL (Long Term) - - 1384.87 1404.58

Renewable 274.99 293.22 298.24 304.79


Realization from surplus sale (195.60) (144.20) (230.64) (203.81)

SLDC Charges 1.05 1.10 1.16 1.22

Standby Charges 221.06 66.34 143.70 143.70

Total power purchase cost

without transmission charges 3523.37 3578.84 3276.20 3446.53

Transmission Charges 265.39 278.66 292.59 307.22

Total power purchase cost

with transmission charges 3788.76 3857.50 3568.79 3753.75

3.7.1.5 The Summary of Power Purchase Quantum and Cost as approved by the

Commission is as given in the tables below:

Table 58: Summary of Power Purchase requirement as approved by the Commission (MU)


Long Term


Page 97 of 302


DTPS 3,994.95 3,787.60 3,787.60 3,798.13

Medium Term

Wardha Power 2,039.49 1,935.96

Abhijeet MADC 441.97 409.53

VIPL 1,001.05 997.76

VIPL (Long Term) 4,047.82 4,058.91

Renewable 196.22 264.82 265.95 267.87

Banking Return 55.79 0.00


Deficit/(Surplus) -842.34 -448.13 -674.58 -571.94

Total Power Purchase 7,334.57 7,693.98 7,920.15 8,184.07

Table 59: Summary of Power Purchase Cost as approved by the Commission (Rs. Crore)


Long Term

DTPS 1,370.28 1,309.68 1,400.66 1,449.27

Medium Term

Wardha Power 1,001.85 793.68

Abhijeet MADC 204.27 177.94

VIPL 510.05 511.75

VIPL (Long Term) 1,384.87 1,404.58

Renewable 163.48 175.23 179.19 183.78

REC 90.81 65.00 67.92 71.24

Banking Return 26.44 0.00


Deficit/(Surplus) -197.70 -111.88 -158.32 -134.23

Stand-by Charges 221.06 59.64 137.00 137.00

SLDC Charges 1.05 1.10 1.16 1.22

Transmission Charge 265.39 428.11 390.27 453.23

Total 3,824.96 3,690.48 3,587.96 3,803.00

3.8 Capital Expenditure and Capitalisation

3.8.1 Capital Expenditure submitted by RInfra-D

3.8.1.1 RInfra-D submitted that it has prepared its capital expenditure plan for FY 2012-13

to FY 2015-16 based on the forecast of system maximum demand, with the

anticipated developments in the area of supply relating to new load, replacement of


Page 98 of 302

existing assets, strengthening and modernization in response to new load, etc. The

capital expenditure plan also interacts with the developments at transmission level

and forecasts the development of downstream infrastructure required for

connectivity to transmission delivery points and evacuation of power thereon.

3.8.1.2 RInfra-D submitted that it used the demand projections arrived at by IIT Bombay

(IITB) as a base for the formulation of the MYT Capex plan. The IITB study used

statistical tools and parameters such as historical demand of RInfra-D, Gross

District Domestic Product growth (GDDP for Mumbai) and other parameters, based

on 17 years historical data to arrive at the Maximum demand. It is anticipated that

maximum demand will be about 2022 MVA, by the end of FY 2015-16.

3.8.1.3 The forecast of maximum demand for the next five years is then used for estimating

the investments required to meet the forecast demand. However, considering the

huge investments required to meet n-1 contingencies and the financial constraints in

making such high levels of investments, the business plan proposed augmentation of

capacity for three nos. of existing receiving stations and commissioning of 17 nos.

of new receiving stations, during the plan period, where substantial loads are

coming up and the nearby power transformers are loaded above 70 %, to optimize

the network and the cost. As a result of the proposed EHV receiving stations, the

network needs to be re-configured which is necessary from the loss reduction

perspective and also to create more Outlets. The associated 11 kV network,

Distribution transformers, Switchgear, LT network, Services and Metering are

proposed to meet the new load requirement and necessary improvement in the

network at different voltage level, which are absolutely essential. Also it is proposed

to replace the existing 11kV Oil type RMUs with SF6/Vacuum RMUs which are

more compact, less prone to failure and safer in operations in order to improve

system reliability and to ensure safety.

3.8.1.4 Apart from the network and allied infrastructure investments proposed above,

RInfra-D submitted setting up of an Energy Park, to impart knowledge and create

awareness of the various aspects of Generation, Transmission and Distribution and

other areas forming part of the Power Sector. RInfra-D has already received in-

principal approval of the said Capex on Energy Park from the Commission for the


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same, vide letter dated 4 July, 2012 (MERC/CAPEX/201212013/00764).

Accordingly, the same was included in the capital expenditure plan.

3.8.1.5 RInfra-D further submitted that, the Business Plan submitted by RInfra-D had

forecasted capital expenditure for FY 2011-12 (based on actuals upto December

2011). However, at the time of the present MYT Petition, the actual capital

expenditure against various schemes in FY 2011-12 is known. There is a slight

under spend during FY 2011-12, which will spill-over into the period going forward

from FY 2012-13. Accordingly, the capital expenditure plan submitted under MYT

Petition is slightly different from what was presented in the Business Plan Petition.

RInfra-D further submitted that fresh capital expenditure of about Rs. 1200 Crore is

planned for the period FY 2012-13 to FY 2015-16. In additional there shall be

capital expenditure against on-going schemes of FY 2011-12 and previous years.

3.8.1.6 RInfra-D further submitted that the Commission, while estimating the capitalisation

for DPR schemes in the Business Plan Order in Case No. 158 of 2011 considered

only those schemes which have been granted in-principle approval. Further, an

additional 20% (of the approved DPR capitalisation) capitalisation was considered

by the Commission towards unplanned expenditure (i.e. Non-DPR schemes limited

to 20% of approved DRR capitalisation) during each year in accordance with

MERC MYT Regulations, 2011. Further, till the time of filing of the MYT Petition,

in-principle approvals of the Commission have been received for all DPR schemes

as submitted by RInfra-D for the MYT Period except for schemes for release of

supply (“Services” DPR), for replacement of 11 kV Oil Type RMUs and for

Metering. The approval of these schemes is anticipated during the proceedings of

MYT Petition and accordingly RInfra-D has considered all capital expenditure

schemes in the present Petition for projection of ARR.

3.8.1.7 Details of the total capital expenditure proposed during the plan period from FY

2012-13 to FY 2015-16, for the Retail Supply business as submitted by RInfra-D are



Page 100 of 302

Table 60: Capex-Retail Supply Business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Metering Schemes 33.74 34.93 36.58 40.03

Energy Park 0.50 3.00 1.99 -

Total Retail Supply –

Capital Expenditure 34.24 37.93 38.57 40.03

3.8.1.8 Details of the total capital expenditure proposed during the plan period from FY

2012-13 to FY 2015-16, for the Wires business as submitted by RInfra-D is given in

the table below:

Table 61: Capex-Wires Business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

DPR Schemes

11kV Network Strengthening Schemes 42.26 80.01 104.63 100.54

11kV Oil Type RMU Replacement 1.40 29.39 30.76 26.50

33 kV feeder reorientation from GIS

Chembur 1.00 3.50 2.50 -

33-22/11 kV Receiving Station Schemes 27.34 40.18 41.35 48.81

33-22/11 kV Receiving Station Schemes

(202012-13) 14.01 36.02 15.01 13.01

33-22/11 kV Receiving Station Schemes

(202013-14) 0.00 15.46 15.46 15.46

33kV Network reconfiguration for new

EHV stations 12.76 19.15 12.76 12.76

Disaster Management (North Division)

(2011-12) 2.94 - - -

Distribution Corporate Office (R&D

Bldg.) (2011-12) 29.12 36.41 7.28 -

LT Mains Schemes 45.35 74.05 41.36 56.99

Revised DPR of Receiving Station FY

2008-09 7.79 5.84 5.84 -

Revised DPR of Receiving Station FY

2009-10 7.81 5.86 5.86 -

Services Schemes 60.84 56.25 54.03 64.59

Street Lighting Schemes 22.23 17.85 18.61 19.06

Underground OFC Network (2011-12) 6.10 18.20 18.62 10.38


Page 101 of 302

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Sub-total - DPR Schemes 280.96 438.16 374.08 368.09

Non DPR Schemes 19.42 30.10 38.29 41.21

Total Distribution Wires - Capital

Expenditure 300.38 468.26 412.37 409.30

Table 62: Summary of Capex (Wire & Retail) as submitted by RInfra-D (Rs. Cr.)

Particulars FY 2012-

13

FY 2013-

14

FY 2014-

15

FY 2015-

16

Capital Expenditure – Distribution

Wires Business 300.38 468.26 412.37 409.30

Capital Expenditure – Retail Supply

Business 34.24 37.93 38.57 40.03

Total Capital Expenditure 334.62 506.19 450.94 449.33

3.8.1.9 RInfra-D submitted that the capital expenditure mentioned in the tables above

includes schemes already approved by the Commission, where commissioning is

expected during the period FY 2012-13 to FY 2015-16 and also includes schemes

which have yet to be approved by the Commission. In addition, unplanned capital

expenditure in the form of Non-DPR schemes has also been estimated for each year

of the MYT Period.

3.8.2 Capitalisation Plan submitted by RInfra-D

3.8.2.1 The summary of the Capitalisation Plan as submitted by RInfra-D for its Retail

supply business is given in the table below:

Table 63: Capitalisation Plan for Retail Supply Business as submitted by RInfra-D (Rs. Cr)


Metering Schemes 34.51 35.32 37.01 40.41

Energy Park 0.00 1.11 4.44 0.00

Total Retail Supply -

Capitalisation 34.51 36.43 41.45 40.41


Page 102 of 302

3.8.2.2 The summary of the Capitalisation Plan as submitted by RInfra-D for its Wires

business is given in the table below:

Table 64: Capitalisation Plan for Wires Business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

DPR Schemes

11 kV Mains and Distribution Transformers 0.19 - - -



33 kV feeder reorientation from GIS Chembur 0.57 1.47 5.79 -


33kV Network reconfiguration for new EHV stations 8.12 8.54 6.78 20.41

Building Construction & Interior Works 6.94 - - -

Corporate Office, Customer Care Centre etc. 8.89 - - -

Disaster Management (North Division) (2011-12) 3.03 - - -

Distribution Corporate Office (R&D Bldg.) (2011-12) - 26.58 70.82 -

LT Mains Schemes 40.94 64.67 58.78 60.91

Receiving Station Schemes 0.04 - - -

Revised DPR of Receiving Station FY 08-09 10.66 13.49 15.39 -



Slum Electrification & Loss Reduction Project 8.66 - - -



Sub Total - DPR Schemes 320.60 330.14 411.43 414.93

Non DPR Schemes 10.01 25.45 40.78 42.34

Total Distribution Wires business - Capitalisation

(including IDC) 330.61 355.59 452.21 457.27

Table 65: Summary of Capitalisation (Wire & Retail) as submitted by RInfra-D (Rs. Cr.)

Particulars FY 2012-13 FY 2013-

14

FY 2014-

15 FY 2015-16

Capital Expenditure – Distribution

Wires Business 330.61 355.59 452.21 457.27

Capital Expenditure – Retail

Supply Business 34.51 36.43 41.45 40.41



Page 103 of 302

3.8.2.3 Further, RInfra-D submitted deviation in Capitalisation as approved by the

Commission in its Business Plan Order and submitted in its MYT Petition as given

in the table below:

Table 66: Comparison of Capitalisation as approved by the Commission in Business Plan

and as submitted by RInfra-D in MYT Petition (Rs. Cr)


B-Plan Order

Total Capitalisation 275.37 177.89 105.35 114.82

R-Infra-D estimates



3.8.2.4 RInfra-D further submitted that the Business plan Petition was based on the

provisional data for FY 2011-12. For the purpose of MYT petition, the final audited

accounts for FY 2011-12 have been considered and the numbers relating to capital

expenditure and capitalization have been accordingly revised. Due to some under-

spending in FY 2011-12, there is spill-over expenditure in FY 2012-13 onwards.

Further, RInfra-D submitted that it considered both the schemes already approved

by the Commission as well as those schemes yet to be approved by the Commission

in the capital expenditure and capitalization proposed for the second control period.


3.8.3.1 The Commission analysed the schemes submitted by RInfra-D and restricted the

DPR scheme named “Distribution Corporate Office (R&D Bldg) (2011-12)” with

Code No. REL-D/FY12/11, whose proposed cost was Rs. 91.43 Crore. This scheme

is under scrutiny of the Commission. Accordingly, the Commission approves the

Capitalisation Plan of RInfra-D for the Second Control Period from FY 2012-13 to

FY 2015-16 for Retail and Wire business as given in the table below:


Page 104 of 302

Table 67: Capitalisation Plan for Wire Business as approved by the Commission (Rs. Cr)

Table 68: Capitalisation Plan for Retail Supply Business as approved by the Commission

(Rs. Cr)


Total Retail Supply - Capitalisation 34.33 36.34 41.34 40.32

3.8.3.2 The Commission in its Order on Business Plan of RInfra-D in Case No. 158 of 2011

dated 23 November, 2012 approved total Capitalisation from FY 2012-13 to FY

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

DPR Schemes

11 kV Mains and Distribution Transformers 0.19 - - -



33 kV feeder reorientation from GIS Chembur 0.57 1.47 5.79 -


33kV Network reconfiguration for new EHV

stations 8.12 8.54 6.78 20.41

Building Construction & Interior Works 6.94 - - -

Corporate Office, Customer Care Centre etc. 8.89 - - -

Disaster Management (North Division) (2011-12) 3.03 - - -

LT Mains Schemes 40.94 64.67 58.78 60.91

Receiving Station Schemes 0.04 - - -




Slum Electrification & Loss Reduction Project 8.66 - - -



Sub Total - DPR Schemes(including IDC) 318.68 299.96 335.33 408.43

Non DPR Schemes(including IDC) 9.95 25.15 40.15 41.67

Total Distribution Wires business -

Capitalisation (including IDC) 328.63 325.11 375.47 450.10


Page 105 of 302

2015 -16 at Rs. 673.43 Crore whereas in the MYT Petition, RInfra-D submitted the

total Capitalisation Plan from FY 2012-13 to FY 2015 -16 as Rs.1748.48 Crore. The

Variation is on account of Seven (7) DPR Schemes pertaining to the proposed

Capitalisation amount of Rs. 1075.56 Cr approved by the Commission after

issuance of Business Plan Order and before submission of RInfra-D MYT Petition.

RInfra-D submitted these schemes as per the directive of the Commission to in its

Business Plan Order in Case No. 158 of 2011:

“…. RInfra-D may include in its MYT Petition, the capitalisation

pertaining to the in-principle approved schemes. The Commission also

notes that the schemes for Retail Supply business of RInfra-D are yet to

receive in-principle approval. RInfra-D may include those schemes as well

in their MYT Petition if they are approved before filing of the same. ”

3.8.3.3 The variation in Capitalisation in Business Plan Order and Capitalisation submitted

by RInfra-D in its MYT Petition and details of additional approved Seven (7) DPR

schemes is as given in the tables below:

Table 69: Variation in Capitalisation as approved by the Commission in Business Plan

Order and as submitted by RInfra-D (Rs. Cr)


B-Plan Order


R-Infra-D estimates


Variation 89.75 214.13 388.31 382.86

Total Variation 1075.05


Page 106 of 302

Table 70: Additional Schemes approved Post issuance of Business Plan Order and Pre

Submission of MYT Petition (Rs. Cr)

S

No.

Proposed Scheme

In principle

Clearance

Code No Year wise Schemes Total

Cost

As

Prop. R-

Infra-D

As

Appr.

MERC

FY13 FY14 FY15 FY16

1

33-22/11 kV

Receiving Station

Schemes (2013-16) 374.14 364.52 REL-D/FY13/02 96.72 100.69 98.46 68.65 364.52

Capitalisation 4.33 19.36 33.42 35.76 92.87

2

11kV Network

Strengthening

Schemes (2013-16) 628.46 628.46 REL-D/FY13/03 145.18 154.88 160.89 167.51 628.46

Capitalisation 74.73 55.41 70.75 121.47 322.35

3

LT Mains Schemes

(2013-16) 261.04 261.03 REL-D/FY13/04 59.59 62.88 67.78 70.78 261.03

Capitalisation 12.91 31.99 58.78 60.91 164.59

4

Services Schemes

(2013-16) 239.23 239.23 REL-D/FY13/05 53.82 57.29 61.41 66.71 239.23

Capitalisation 31.08 54.49 50.98 67.48 204.03

5

Metering Schemes

(2013-16) 145.28 145.28 REL-D/FY13/06 33.74 34.93 36.58 40.03 145.28

Capitalisation 34.51 35.32 37.01 40.41 147.25

6

Street Lighting

Schemes (2013-16) 73.46 73.47 REL-D/FY13/07 17.43 18.02 18.86 19.15 73.46

Capitalisation 8.81 18.66 16.9 20.31 64.68

7

11kV Oil Type

RMU Replacement

(2013-16) 111.71 111.71 REL-D/FY13/08 27.99 28 27.91 27.82 111.72

Capitalisation 0.72 15.84 34.43 28.8 79.79

Total Capex Year

Wise 434.47 456.69 471.89 460.65 1823.7

Total

Capitalisation

Year Wise 167.09 231.07 302.27 375.13 1075.56

3.9 Depreciation

3.9.1 Depreciation submitted by RInfra-D

3.9.1.1 RInfra-D submitted that in accordance with MERC MYT Regulations, 2011 it has

computed depreciation expenses as provided below:


Page 107 of 302

“31.2 The Generation Company and Transmission Licensee or Distribution

Licensee shall be permitted to recover depreciation on the value of fixed

assets used in their respective Business computed in the following manner:

(a) The approved original cost of the project/fixed assets shall be the value base

for calculation of depreciation:

Provided that the depreciation shall be allowed on the entire capitalised

amount of the new assets after reducing the approved original cost of the

project/fixed assets of retired or replaced assets.

(b) Depreciation shall be computed annually based on the straight line method

at the rates specified in the Annexure I to these Regulations:

Provided that the Generating Company or Transmission Licensee or

Distribution Licensee shall ensure that once the individual asset is

depreciated to the extent of seventy (70) percent, remaining depreciable

value as on 31st March of the year closing shall be spread over the

balance useful life of the asset, as provided in these Regulations. Provided

that the Generating Company or Transmission Licensee or Distribution

Licensee, shall submit all such details or documentary evidence, as may

be required under this Regulation and as stipulated by the Commission,

from time to time, to substantiate the above claims.

(c) The salvage value of the asset shall be considered at 10 per cent of the

allowable capital cost and depreciation shall be allowed upto a maximum

of 90 per cent of the allowable capital cost of the asset.”

3.9.1.2 RInfra-D submitted that the computation of depreciation in its MYT Petition for the

Second Control Period is divided into two parts as under:

a) Effective Depreciation rate for each asset class is determined for application

after crossing 70% threshold. For this purpose, the useful life of assets defined

in MYT Regulations, 2011 has been considered as per the said Regulations

and the assets for which no useful life is provided in the Regulations, the same

have been considered as per the Companies Act, 1956. The effective

depreciation rate after crossing 70% threshold is worked out as given in the

table below:

Table 71: Depreciation rates as submitted by RInfra-D (after crossing 70% threshold)

Type of Asset

Till 70%

(AS per MYT

Regulations)

Useful Life as

per MERC/

based on

companies

act

Year

Lapsed

till 70%

Remaining

life after 70%

Depreciation

rate after 70%

Lease Hold Land 3.34% 90 19 71 0.28%

Building 3.34% 50 19 31 0.65%

Plant & Machinery 5.28% 25 12 13 1.54%


Page 108 of 302

Type of Asset

Till 70%

(AS per MYT

Regulations)

Useful Life as

per MERC/

based on

companies

act

Year

Lapsed

till 70%

Remaining

life after 70%

Depreciation

rate after 70%

Distribution System 5.28% 35 12 23 0.87%

Vehicles 9.50% 10 7 3 6.67%

Furniture/Fixture 6.33% 14 10 4 5.00%

Off. Equipment 6.33% 14 10 4 5.00%

Computer & Software 15.00% 6 4 2 10.00%

Elect. Fittings 6.33% 14 10 4 5.00%

Refg & Domestic Appliances 6.33% 14 10 4 5.00%

b) Depreciation on the opening GFA as on 1 April, 2012: The assets

comprising the Opening GFA as on 1 April 2012 and their corresponding

accumulated depreciation considered. Depreciation calculated based on query

run in the SAP system on the asset database with the following conditions

which are in line with MERC MYT Regulations 2011:

i. Depreciation was calculated at the rates specified by the MERC

MYT Regulations, 2011 upto the 70% threshold. On reaching

70%, depreciation is computed using the effective rate as shown in

the table above.

ii. The MYT Regulations, 2011 have specified the useful life for sub-

station and distribution lines. For other assets, useful life has been

considered as per the Companies Act, 1956.

c) Depreciation for new capitalized asset during the period FY 2012-13 to

FY 2015-16: In the case of assets capitalized during the period FY 2012-13 to

FY 2015-16, the depreciation is calculated on straight line basis, as per the

rates & the useful life as specified in the MERC MYT Regulations, 2011,

applying the same principles as above. However, for these new assets,

depreciation has been calculated considering mid-year capitalisation. RInfra-D

further submitted that no asset from this category will reach 70% of its value

during the MYT Period.


Page 109 of 302

3.9.1.3 RInfra-D further submitted that the effect of retirement of assets and withdrawal of

corresponding accumulated depreciation, differential depreciation rates, and salvage

value were considered in these calculations for depreciation for opening GFA as on

1 April, 2012. RInfra-D submitted that depreciation has not been claimed beyond

90% of the asset value.

3.9.1.4 RInfra-D submitted that the projections of Asset base and Depreciation have been

made considering projected capitalisation and the existing mix in which assets are

added in FY 2011-12. However, there could be changes on account of variation in

capitalization, asset mix of assets added, retirement of assets, etc. which would alter

the actual depreciation from what is estimated.

3.9.1.5 RInfra-D submitted that the Commission in its Order on the Business Plan in Case

No. 158 of 2011 directed RInfra-D to provide details of retired assets during the

period FY 2012-13 to FY 2015-16. In this regard, RInfra-D submitted that currently

only a lump-sum value for asset retirement has been estimated in the MYT Petition

and the same is not based on any actual analysis of assets based on their accounting

or physically useful life. RInfra-D submitted that even with assets reaching 90% of

historical value during MYT Period, the same may not be retired as the asset might

still be useful based on its actual physical condition. RInfra-D requested the

Commission to kindly waive this direction as it would be very difficult to currently

estimate actual asset-wise retirement during the MYT Period.

3.9.1.6 Further, in reply to the Commission’s query of certificate from the Statutory Auditor

– certifying that the calculation of depreciation as presented in the MYT petition is

based on the balances as appearing in the books of accounts as on 31 March, 2012

and the depreciation working is correctly prepared as per the applicable MYT

Regulations, 2011 and placement of the certificate in the Audit Committee of the

Company, RInfra-D submitted vide its reply dated 11 February, 2013 that the

depreciation working for the years under consideration is based on depreciation on

Opening GFA as well as on asset projected to be added during the year. The

depreciation workings are based on estimates of asset additions and not actuals, and


Page 110 of 302

therefore the auditor would not be able to certify the same. Since the certification is

not possible the same could not be placed before the Audit Committee.

3.9.1.7 The depreciation calculation for the Retail Supply business as submitted by RInfra-

D for the period FY 2012-13 to FY 2015-16 is given in the table below:

Table 72: Depreciation for Retail Supply business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening GFA 506.55 534.68 565.02 600.24

Addition 34.51 36.43 41.45 40.41

Retirement 6.39 6.09 6.24 6.16

Closing GFA 534.68 565.02 600.24 634.48

Depreciation for Opening Balance (1

Apr 2012) 15.78 15.75 15.68 15.52

Depreciation for new additions 0.91 2.77 4.78 6.89

Total Depreciation 16.69 18.52 20.45 22.42

3.9.1.8 The depreciation calculation for the Wires business as submitted by RInfra-D for the

period FY 2012-13 to FY 2015-16 is given in the table below:

Table 73: Depreciation for Wire business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening GFA 3644.68 3968.32 4317.42 4762.9

Addition 330.61 355.59 452.21 457.27

Retirement 6.97 6.49 6.73 6.61

Closing GFA 3968.32 4317.42 4762.9 5213.56

Depreciation for Opening Balance

(1 Apr 2012) 157.58 156.21 155.58 154.13



3.9.1.9 Further, RInfra-D submitted deviation in Depreciation from the value approved by

the Commission in its Business Plan Order in Case No. 158 of 2011 and those

submitted in its MYT Petition as given in the table below:


Page 111 of 302

Table 74: Comparison of Depreciation as approved by the Commission in Business Plan

and as submitted by RInfra-D in MYT Petition (Rs. Cr)


13

FY 2013-

14

FY 2014-

15

FY 2015-

16

Business Plan Order

Depreciation – Wires 144.50 154.26 160.24 164.82

Depreciation – Retail 15.71 15.41 15.11 14.81

Total 160.21 169.67 175.35 179.63

MYT Petition



Total 182.81 201.00 223.16 247.17

3.9.1.10 RInfra-D also provided reasons for above deviation in the depreciation expenses as

given below:

a) The Business Plan Petition was based on provisional accounts for FY 2011-

12. Subsequently, the annual accounts for FY 2011-12 were finalized and

audited and therefore changes have been made to the capital expenditure

and capitalisation numbers based on such audited annual accounts, which

causes change in the opening value of gross block for MYT Period i.e. as 1

April, 2012.

b) In the Business Plan Order the Commission approved capitalisation in the

second control period based on then approved schemes. For the purpose of

MYT Petition, the total capital expenditure and capitalisation, RInfra-D

considered both approved and yet to be approved schemes, has been

included for the second control period.


3.9.2.1 The Commission has considered the approved Capitalisation from FY 2012-13 to

FY 2015-16 for addition of assets during the year and has prorated for each asset

category. The Commission has considered the opening GFA for FY 2011-12 as


Page 112 of 302

approved in its Order in Case No. 124 of 2012 (truing up of depreciation for FY

2011-12 ) for further projections of GFA for Second Control Period of the MYT.

3.9.2.2 The Commission has considered Depreciation Expenses in two stages separately,

first Depreciation on opening GFA and secondly on asset addition for Second

Control Period of the MYT. The Depreciation on opening GFA has been calculated

by dividing the depreciation amount claimed by RInfra-D and prorated it to the ratio

of opening GFA for each asset category as submitted by RInfra-D and opening GFA

for that asset category as projected by the Commission in that respective year. For

depreciation on asset addition i.e., in the case of assets capitalised during the period

FY 2012-13 to FY 2015-16, the depreciation is calculated on straight line basis, as

per the rates & the useful life as specified in the MERC MYT Regulations, 2011,

mid-year capitalisation rate for each asset category. The estimated retirement of

assets for Second Control Period of MYT as submitted by RInfra-D has been taken

as the retirement of assets.

3.9.2.3 The total depreciation allowed for Second Control Period of MYT from FY 2012-

13 to FY 2015-16, which is the sum of the depreciation for both Wires and the

Retail businesses is summarised in the Table below:

Table 75: Depreciation for Wires business as approved by the Commission (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening GFA 3636.75 3958.41 4277.03 4645.77

Addition 328.63 325.11 375.47 450.10

Retirement 6.97 6.49 6.73 6.61

Closing GFA 3958.41 4277.03 4645.77 5089.26

Depreciation for Opening Balance 157.24 155.87 155.24 153.80




Page 113 of 302

Table 76: Depreciation for Retail Supply business as approved by the Commission

(Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening GFA 506.55 534.50 564.74 599.84

Addition 34.33 36.34 41.34 40.32

Retirement 6.39 6.09 6.24 6.16

Closing GFA 534.50 564.74 599.84 634.00

Depreciation for Opening Balance 15.78 15.69 15.68 15.53



Table 77: Total Depreciation as approved by the Commission for the Second Control

Period (Rs. Cr)


13

FY 2013-

14

FY 2014-

15

FY 2015-

16

MYT Order



Total 182.41 199.70 219.15 240.99

MYT Petition (RInfra-D)



Total 182.81 201.00 223.16 247.17

3.10 Interest on Long Term Loan Capital

3.10.1 Interest on Long Term Loan Capital submitted by RInfra-D

3.10.1.1 RInfra-D submitted that from FY 2011-12 it has looked beyond its conventional

practice of funding all capital expenditure through its own equity pool and has tied

up loans from financial institutions and commercial banks. RInfra-D raised Rs. 1000

Crore by the way of Non-Convertible Debentures (NCD) during FY 2011-12.

RInfra-D also took a loan of Rs. 350 Crore from Central Bank of India, for which

RInfra-D has offered for security, the assets already created and capitalized before

the disbursement of the loan. Accordingly, RInfra-D considered the loan amounts


Page 114 of 302

towards setting off already admitted normative debt as on 1 April, 2011 Therefore,

the opening normative debt of Rs.1335.62 Crore (as per the Petition in Case No.124

of 2012) was replaced by the above mentioned Rs. 1350 Crore actual borrowing.

The balance of Rs. 14.38 Crore is used for new capital expenditure for FY 2011-12.

RInfra-D provided explanation of the financing arrangement and the corresponding

interest computation as given below:

Interest expenses for opening normative debt balance as on 1 April, 2012

3.10.1.2 Issue of Rs. 1000 Crore non-convertible debentures: RInfra-D submitted it raised

Rs. 1000 Crore by way of issue of secured Non-Convertible Debentures (NCD)

during FY 2011-12 (issue subscribed by various agencies – LIC, New India

Assurance, GIC, Yes Bank, Pension funds, etc.). The NCDs are secured by creation

of charge on the distribution business assets of RInfra-D. The intimation of creation

of charge was forwarded by RInfra-D to the Commission vide its letter dated 24

April, 2012 as required under the terms of MERC (General Conditions of

Distribution License) Regulations, 2006. The NCDs of Rs. 1000 Crore have been

utilized against the opening normative debt as on 1 April, 2011 of Rs. 1335.62

Crore.

3.10.1.3 Term Loan of Rs. 350 Crore from Central Bank of India: RInfra-D submitted it

has also contracted debt of Rs. 350 Crore from the Central Bank of India during FY

2011-12 for financing its capital expenditure. A major part of this loan is considered

towards refinancing the normative debt balance (left over from refinancing by

NCD) as on 1 April, 2011.

3.10.1.4 RInfra-D submitted that according to the MERC MYT Regulations, 2011 repayment

for the second control period is equal to depreciation for that year as given below:

“33.3 The repayment for the year of the tariff period FY2011-12 to

FY2015-16 shall be deemed to be equal to the depreciation allowed for

that year….”

Accordingly, for computation of Interest on long term loan, RInfra-D considered

repayment equivalent to depreciation. The depreciation has been apportioned


Page 115 of 302

across the loan considering the opening balance of loans. Further, MYT

Regulations, 2011 provide the following with respect to depreciation:

“31.2 (b) Depreciation shall be computed annually based on the straight

line method at the rate specified in the Annexure I to these Regulations:

Provided that the Generating company or transmission licensee or

distribution licensee shall ensure that once the individual asset is

depreciated to the extent of seventy (70) percent, remaining depreciable

value as on 31st March of the year closing shall be spread over the

balance useful life of the asset, as provided in these Regulations”

3.10.1.5 RInfra-D submitted that, considering depreciation rates as mentioned in the MYT

Regulations, 2011 and debt percentage of 70%, the repayment period considered for

tariff purposes stretches to more than 13 years. RInfra-D further added that however

MERC (General Conditions of Distribution License) Regulations, 2006 provides

that the tenure of any financing arrangement, where assets have been utilized for

facilitating financing (i.e. creation of charge on assets), cannot exceed 7 years as

under:

“The Distribution License shall be entitled to utilize the assets for

facilitating financing its investment requirement subject to the

conditions…

(b) that the financing arrangement is for a period not exceeding seven

years or such other period as the commission may specifically direct”

3.10.1.6 RInfra-D submitted its loan schedule as given in the table below:

Table 78: Loan Schedule as submitted by RInfra-D (Rs. Cr)

Particulars

Amt.

(Rs.

Cr)

Interest

Rate

FY

2012-

13

FY

2013-

14

FY

2014-

15

FY

2015-

16

FY

2016-

17

FY

2017-

18

FY

2018-

19

NCDs Repayment Schedule

LIC others 585 10.50% 585

NIACL 50 10.25% 16.67 16.67 16.67

Yes Bank 121 11.15% 121

Yes Bank 120 11.15% 120

Yes Bank 124 11.15% 124


Page 116 of 302

Particulars

Amt.

(Rs.

Cr)

Interest

Rate

FY

2012-

13

FY

2013-

14

FY

2014-

15

FY

2015-

16

FY

2016-

17

FY

2017-

18

FY

2018-

19

Total 1000

Term

Loan

Central

Bank of

India

350 14 28 28 28 28 224

3.10.1.7 RInfra-D submitted that loan conditions mentioned in the MERC (General

Conditions of Distribution License) Regulations, 2006 and that which has been

considered for Tariff purposes as per MYT Regulations, 2011 do not match. This

mismatch will lead to imbalances in the cash flow for RInfra-D. Hence, while

RInfra-D has not contracted secured loans for more than seven years, it has to

manage the debt redemption obligation with project accruals of depreciation. In

order to overcome this problem, RInfra-D intends to refinance the bullet repayment

when the same falls due (for e.g. in case of NCD, first redemption is due in FY

2015-16 and in case of term loan, bullet repayment is due in FY 2017-18). Further,

RInfra-D submitted that as the estimation of the interest rate in the future is

unpredictable at the present the refinancing has been considered at the prevailing

interest rate of each of the tranches. In case of loans with moratorium, the

refinancing shall be done after setting off depreciation accrued during the

moratorium period.

3.10.1.8 RInfra-D further submitted that entire outstanding normative debt is now replaced

with actual loans through issue of NCD and Term Loans. The actual interest rates

applicable for the existing loans have been considered for computing interest on

long term loan capital after considering that repayment for these loans is equal to the

depreciation as per the MYT Regulations, 2011. RInfra-D submitted that the interest

rate for normative portion of the debt considered in FY 2011-12 is assumed to be

11.50% which is as per the Business Plan Order in Case No. 158 of 2011 and the

repayment amount is considered same as proportionate depreciation.


Page 117 of 302

3.10.1.9 RInfra-D further submitted that a small portion of the term loan from Central Bank

of India is also considered towards funding of capitalization during FY 2011-12.

The interest rate and repayment schedule for actual term loan is considered as per

the terms of the loan i.e. for FY 2011-12 the interest rate was 11.80% which was

revised to 11.55% from May 2012.

3.10.1.10 The summary for loan computation for loans existing as on 31 March 2012,

including the NCD, Term Loan and Normative Loan bifurcated into Retail supply

Business and Wires Business as submitted by RInfra-D is provided in the table

below:

Table 79: Summary of Interest Expenses for existing loans for Retail Supply Business as

submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening balance 146.68 130.9 115.15 99.47

Addition 0.00 0.00 0.00 0.00

Repayment 15.78 15.75 15.68 15.52

Closing Balance 130.9 115.15 99.47 83.95

Interest on opening balance of debt 15.21 13.48 11.76 10.05

Table 80: Summary of Interest Expenses for existing loans for Wires Business as submitted

by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening balance 1268.2 1110.63 954.41 798.83

Addition 0.00 0.00 0.00 0.00

Repayment 157.58 156.21 155.58 154.13

Closing Balance 1110.63 954.41 798.83 644.7

Interest on opening balance of debt 131.07 113.78 96.6 79.54

Interest expenses for new loans in the period FY 2012-13 to FY 2015-16

3.10.1.11 Financing of Capital Expenditure for the Second Control Period: RInfra-D

submitted that for the proposed capital expenditure and capitalisation for the second

control period, the financing is considered on the normative debt/equity ratio of

70:30 based on MERC MYT Regulations, 2011. The consumer contribution has


Page 118 of 302

been deducted from the total capitalisation while working out the 70% debt

requirement. RInfra-D submitted that currently there are no plans to draw any fresh

actual debt during the MYT Period for the purpose of capital expenditure. Hence, all

fresh debt requirements is considered normative at the interest rate of 11.5% as

approved by the Commission in the Business Plan Order in Case No. 158 of 2011.

The proportionate depreciation for the fresh capital expenditure was considered as

repayment according to the MERC MYT Regulations, 2011. The summary for

interest computation for new loans for Retail supply Business and Wires Business as

submitted by RInfra-D is provided in the table below:

Table 81: Summary of Interest Expenses for New loans for Wires Business as submitted by

RInfra-D (Rs. Cr)


Opening balance 0.00 222.89 445.54 714.96

Addition 231.43 248.92 316.55 320.09

Repayment 8.54 26.26 47.13 70.62

Closing Balance 222.89 445.54 714.96 964.43

Interest rate (%) 11.50% 11.50% 11.50% 11.50%

Interest 12.82 38.43 66.73 96.56

Table 82: Summary of Interest Expenses for New loans for Retail Supply Business as

submitted by RInfra-D (Rs. Cr)


Opening balance 0.00 23.25 45.98 70.22

Addition 24.16 25.5 29.02 28.29

Repayment 0.91 2.77 4.78 6.89

Closing Balance 23.25 45.98 70.22 91.61

Interest rate (%) 11.50% 11.50% 11.50% 11.50%

Interest 1.34 3.98 6.68 9.31

3.10.1.12 The summary of the interest rate expenses for Retail supply Business and Wires

Business as submitted by RInfra-D is provided in the table below:


Page 119 of 302

Table 83: Summary of Total Interest Expenses for Wires & Retail Business as submitted by

RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Interest on opening Balance as on 1st

April 2012

Wires 131.07 113.78 96.60 79.54

Retail 15.21 13.48 11.76 10.05

Total 146.28 127.26 108.36 89.59

Interest on New Loans (FY 2012-13 to

FY 2015-16)

Wires 12.82 38.43 66.73 96.56

Retail 1.34 3.98 6.68 9.31

Total 14.16 42.41 73.41 105.87

Total Interest Expenses 160.44 169.67 181.77 195.46

3.10.1.13 Further, with respect to the Commission’s query regarding actual/normative loan

outstanding against the retired assets, RInfra-D submitted vide its reply dated 11

February, 2013 that the loan component in the cost of the asset is only 70%, the loan

would be completely repaid by way of depreciation before the asset is retired.

3.10.1.14 Further, RInfra-D submitted deviation in interest rate expenses as approved by the

Commission in its Business Plan Order in Case No. 158 of 2011 and submitted in its

MYT Petition as given in the table below:

Table 84: Comparison of Interest Expenses as approved by the Commission in Business

Plan Order and as submitted by RInfra-D in MYT Petition (Rs. Cr)

Interest on Loans FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16

Business Plan Order

Retail 6.14 4.70 3.29 1.91

Wire 83.41 85.69 79.62 69.97

Total 89.55 90.39 82.92 71.89

MYT Petition

Retail 16.55 17.46 18.44 19.36

Wire 143.89 152.21 163.33 176.10

Total 160.44 169.67 181.77 195.46


Page 120 of 302

3.10.1.15 RInfra-D submitted reasons for above deviation in the interest rate expenses as

given below:

a) In the MYT Petition RInfra-D considered the actual interest rates

corresponding to the NCD and Term Loans, for the purpose of computing

the interest on the opening normative debt, whereas the Commission in the

Business Plan Order considered normative interest rates as approved by it in

the previous Orders (i.e. 8%, 10%, 9%, depending upon the year of

admittance of loan).

b) The amount of debt balance considered by RInfra-D is based on the actual

capitalisation till FY 2011-12. The Business Plan Petition was based on

provisional accounts for FY 2011-12. Subsequently, the annual accounts for

FY 11-12 were finalized and audited and therefore changes have been made

to the capital expenditure and capitalization numbers based on such audited

annual accounts.

c) In the Business Plan Order, the Commission approved capitalisation in the

second control period based on the then approved schemes. For the purpose

of MYT Petition, the total capital expenditure and capitalisation,

considering both approved and yet to be approved schemes, were included

for the Second Control Period.


3.10.2.1 As regards the refinancing of the existing normative loan with actual loan, the

Commission in its Order in Case No. 180 of 2011 has ruled as under:

“The Commission has already approved interest rates for normative debt

corresponding to the capitalisation approved in respective years before

FY 2011-12. As per the Commission’s view, present Petition cannot seek

review of the decisions already taken in the earlier Orders which have

remained unchallenged and hence have attained finality. In line with the


Page 121 of 302

practice followed for the past years, the Commission approves fixed

interest rate of 11.50% for normative debt corresponding to the

capitalisation which belongs to FY 2011-12.”

3.10.2.2 Accordingly, for the purpose of estimating interest expenses for Second Control

Period of MYT from FY 2012-13 to FY 2015-16, the Commission has not

considered the proposed financing of normative loans by actual loans as submitted

by RInfra-D. Moreover, it was observed that the proposed re-finance of the

normative loans have been done with expensive loan. The comparison of the

normative loan and actual is as given in the table below:

Particulars Outstanding

Loan

Approved

Interest

Rate by the

Commission

Actual

Loan for

re-finance

Loan

Amount

Applicable

Actual

Interest Rate

as submitted

by RInfra-D

Closing Balance for

FY 05-06 239.60 10.00%

LIC &

Others 585.00 10.50%

Projects initiated

during FY 06-07 205.86 8.00% NIACL 50.00 10.25%

Projects initiated

during FY 07-08 129.52 8.00% YES Bank 121.00 11.15%

Projects initiated


Projects initiated


Projects initiated

during FY 10-11 282.93 9.00%

Central

Bank of

India

350.00 11.80%

Total 1,335.62 1,350.00

3.10.3 In regard to the actual loans availed by RInfra-D, the Commission on scrutiny of the

term sheets of these loans, observed that all the actual loans availed by RInfra-D have

a repayment period of 7 years or less. This clearly indicates that repayment of these

loans will have to be refinanced as instalments for repayment becomes due. The

Commission observes that RInfra-D’s proposal to refinance all the actual loans stated

above as and when repayment becomes due could expose its consumers to


Page 122 of 302

refinancing risk, which might be detrimental to the interest of the consumers.

3.10.4 Further, as regards the contention of RInfra-D regarding provisions specified in the

General Conditions of the Distribution Licence that the financing arrangement is for a

period not exceeding seven years or such other period as the Commission may

specifically direct and hence it has not contracted loan for repayment of more than 7

years does not hold true, since, by way of notifying the MERC MYT Regulations,

2011, the Commission has specified that the repayment for each year of the MYT

Control Period shall be deemed to be equal to the depreciation allowed for that year.

3.10.5 Therefore, the Commission, considering prudency of the expenditure, is of the view

that refinancing of normative loan with actual loans as proposed by RInfra-D should

not be allowed. Further, the Commission disallows admittance of actual loans of

shorter duration.

3.10.6 The Commission has considered the closing balance of loan as on FY 2011-12 as

approved by the Commission in its Order in Case No. 124 of 2012 as the opening

balance of loan for FY 2012-13. From FY 2012-13 to FY 2015-16, the Commission

has considered loan addition for each of the year as 70% of the capitalisation

approved for the respective year.

3.10.7 Regulation 33 of the MERC MYT Regulations, 2011 specifies that the repayment of

loan shall be equal to the depreciation allowed in the respective year. Accordingly,

the Commission has considered the repayment of loan equal to the depreciation as

approved for respective years.

3.10.8 Regulation 33 of the MERC MYT Regulations, 2011 specifies that the rate of interest

used for calculation of interest on long-term loans shall be weighted average rate of

interest on the basis of actual loan portfolio at the beginning of each year. Further, the

interest should be calculated on the normative average loan availed in a particular

year.

3.10.9 However, the Commission has considered all loans availed by RInfra-D as normative

loans for the approval of MYT Petition. Hence, as per the 2nd

proviso to Regulation

33.5 of MERC MYT Regulations, 2011, if the Distribution Licensee doesn’t have any

actual borrowings, then the weighted average interest of the generating company or

transmission licensee or distribution licensee as a whole needs to be considered.


Page 123 of 302

3.10.10 The Commission computed the weighted average interest rate in accordance with

Regulations quoted above. For computing weighted average interest of RInfra

company as a whole all long-term loans availed by RInfra as provided in the latest

audited financial statements, i.e., for FY 2011-12 is considered. However, the loans

disallowed by the Commission in the Business Plan Order for RInfra-D (Case No.

158 of 2011) and RInfra-T (Case No. 159 of 2011) have not been considered for

computation of weighted average interest rate. The Commission has further not

considered the loan of Rs. 300 Crore toward NCD being short-term repayable in one

year. The weighted average interest rate of RInfra as computed is provided below:

Table 85: Weighted average interest rate of RInfra as computed by the Commission

SL No Particulars of long term borrowing Amount

(Rs crore) Yearly interest (Rs crore)

1 6.35% secured NCD 250 15.88

2 6.70% secured NCD 125 8.38

3 5.95% secured NCD 100 5.95

4 5.60% secured NCD 150 8.4

5 11.55% secured NCD 850 98.18

6 ECB in foreign currency unsecured 763.12 50.59

7 Central bank of India 300 35.4

Total 2,538.12 222.77

Weighted average interest rate 8.78%

3.10.11The Commission has applied interest rate on the average of opening balance and

closing balance of loan for each year in order to compute the interest expense on

long-term loans admitted during the MYT second Control Period for each of the year

from FY 2012-13 to FY 2015-16.

3.10.12 The summary of the outstanding loans, new loan, repayment of loans and interest

expense for Wire and Retail business for the Second Control Period of the MYT is as


Table 86: Interest Expenses on Long Terms loans for the MYT period as approved by the

Commission (in Rs. Crore)


Page 124 of 302


Retail

Opening Balance 157.94 165.29 172.27 180.77

Additions of New Loans 24.03 25.44 28.94 28.22

Repayments 16.69 18.45 20.43 22.40

Closing Balance 165.29 172.27 180.77 186.60

Interest Expenses 14.19 14.82 15.50 16.13

Wires

Opening Balance 1,262.87 1,327.19 1,373.52 1,437.64


Repayments 165.73 181.25 198.71 218.59

Closing Balance 1,327.19 1,373.52 1,437.64 1,534.11


Retail + Wires

Opening Balance 1,420.82 1,492.48 1,545.79 1,618.41


Repayments 182.41 199.70 219.15 240.99

Closing Balance 1,492.48 1,545.79 1,618.41 1,720.71


3.11 Return on Equity

3.11.1 Return on Equity submitted by RInfra-D

3.11.1.1 RInfra-D submitted that in its MYT Petition it has worked out the Return on Equity

by considering the opening equity balance and equity portion of new capitalisation.

The equity portion of new capitalisation in the period FY12-13 to FY 15-16 has

been considered at 30% of capitalisation for respective year. The consumer

contribution during the year was reduced from the capitalisation during the

respective years to arrive at the regulatory equity at the end of the year. The opening

equity as on 1 April, 2013 is based on the True-Up Petition for FY 2011-12 in Case

No. 124 of 2012, for RInfra-D. Further, it was submitted that to the equity thus

determined, the rate of return as specified in MERC MYT Regulations 2011 was

applied. RInfra-D considered return on the opening equity for the full year, while


Page 125 of 302

50% equity was considered for the capital expenditure capitalised during the year as

per the MYT Regulations.

“32.2.1 Return on equity capital for the Transmission Licensee and Wires

Business of Distribution Licensee shall be computed on the equity capital

determined in accordance with Regulation 30 at the rate of 15.5 % per

cent per annum, and for the Retail Supply of Electricity of Distribution

Licensee, Return on equity capital shall be allowed a return at the rate of

17.5 % per cent per annum, in Indian Rupee terms, on the amount of

equity capital determined in accordance with Regulation”

3.11.1.2 The details of the Return on Equity as submitted by RInfra-D for its Wires and

Retail supply business are as given in the tables below:

Table 87: Return on Equity for Wires Business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Regulatory Equity at the beginning of the year 1,420.82 1,512.32 1,610.89 1,737.77

Capitalisation during the year 330.61 355.59 452.21 457.27

Equity portion of capitalisation during the year 91.49 98.58 126.87 127.75

Consumer Contribution and Grants used during

the year for Capitalisation 18.65 20.52 22.57 24.83

Reduction in Equity Capital on account of

retirement / replacement of assets 6.97 6.49 6.73 6.61

Regulatory Equity at the end of the year 1,512.32 1,610.89 1,737.77 1,865.52

Return Computation 15.50% 15.50% 15.50% 15.50%

Return on Regulatory Equity at the beginning

of the year 220.23 234.41 249.69 269.35

Return on Equity portion of capitalisation

during the year 7.09 7.64 9.83 9.90

Total Return on Regulatory Equity 227.32 242.05 259.52 279.25


Page 126 of 302

Table 88: Return on Equity for Retail Supply Business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Regulatory Equity at the beginning of the

year 156.29 164.73 173.83 184.39

Capitalisation during the year 34.51 36.43 41.45 40.41

Equity portion of capitalisation during the

year 8.44 9.10 10.56 10.27

Consumer Contribution and Grants - - - -

Reduction in Equity Capital on account of

retirement / replacement of assets 6.39 6.09 6.24 6.16

Regulatory Equity at the end of the year 164.73 173.83 184.39 194.67

Return Computation 17.50% 17.50% 17.50% 17.50%

Return on Regulatory Equity at the

beginning of the year 27.35 28.83 30.42 32.27

Return on Equity portion of capitalisation

during the year 0.74 0.80 0.92 0.90


Table 89: Return on Equity for Wires and Retail Business as submitted by RInfra-D

(Rs. Cr)


Retail 28.09 29.62 31.34 33.17

Wire 227.32 242.05 259.52 279.25

Total 255.41 271.67 290.87 312.42

3.11.1.3 Further RInfra-D submitted that in its Business Plan Order in Case No. 158 of 2011

dated 23 November, 2012 the Commission considered the closing balance of equity

as approved in its Order in Case No. 180 of 2011 as the opening balance for FY

2012-13 and additional thereafter was considered as per the capitalisation approved

for each year of MYT Period. However, RInfra-D in its MYT Petition considered

the opening equity for FY 2012-13 as per the actual closing equity of FY 2011-12 as


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per its Petition under Case No. 124 of 2012, which considered the actual

capitalisation during FY 2011-12. RInfra-D considered both approved and yet-to-be

approved schemes for the purpose of projections of the capital expenditure and

capitalization during the second control period, whereas the Commission in its

Business Plan Order in Case No. 158 of 2011considered only then approved

schemes for the purpose of projecting capitalisation for the Second Control Period.

The deviation in Return on Equity as approved by the Commission in its Business

Plan Order in Case No. 158 of 2011 dated 23 November, 2012 and projected by

RInfra-D in its MYT petition was submitted by RInfra-D as given in the table

below:

Table 90: Comparison of RoE as approved by the Commission in Business Plan and as

submitted by RInfra-D in MYT Petition (Rs. Cr)


As per Business Plan

Order 220.14 229.33 234.85 238.95

As per MYT Petition 255.41 271.67 290.87 312.42


3.11.2.1 While estimating Return on Equity (RoE) for the Second Control period of the

MYT from FY 2012-13to FY 2015-16, the Commission has subtracted 30% of the

GFA of the retired assets and Consumer Contribution and Grants while computing

closing level of Regulatory Equity. The Opening Equity for FY 2012-13 has been

considered as the Closing Regulatory Equity for FY 2011-12 approved by the

Commission in its Order in Case No. 124 of 2012 (Final truing up of FY 2011-12

and FY 2010-11).Further, while computing RoE for the Second Control Period of

the MYT, the Commission added 50% of the equity portion of the approved

Capitalisation during the year. The RoE has been considered in line with the MYT

Regulations, 2011, i.e., 17.5% for Retail Supply business and 15.5% for Wire

business as quoted below:


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“32.2.1 Return on equity capital for the Transmission Licensee and Wires

Business of Distribution Licensee shall be computed on the equity capital

determined in accordance with Regulation 30 at the rate of 15.5 % per

cent per annum, and for the Retail Supply of Electricity of Distribution

Licensee, Return on equity capital shall be allowed a return at the rate of

17.5% per cent per annum, in Indian Rupee terms, on the amount of equity

capital determined in accordance with Regulation 30.”

3.11.2.2 The summary of RoE approved by the Commission for the Second Control period

of the MYT from FY 2012-13 to FY 2015-16 is as given in the table below for

Retail and Wire Business:

Table 91: Return on Equity as approved by the Commission for the Second Control

Period of the MYT Period

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Retail

Regulatory Equity at the beginning of the year 156.29 164.67 173.74 184.28

Capitalized Expenditure 34.33 36.34 41.34 40.32

Less: Reduction in Regulatory Equity during

the year due retirement of assets

6.39

6.09

6.24

6.16

Equity portion of capitalized expenditure 8.38 9.07 10.53 10.25



of the year 27.35 28.82 30.41 32.25

Return on Equity portion of capitalized

expenditure

0.73

0.79

0.92

0.90


Wires

Regulatory Equity at the beginning of the year 1418.44 1509.34 1598.77 1702.63

Capitalized Expenditure 328.63 325.11 375.47 450.10

Less: Consumer contribution 18.65 20.52 22.57 24.83

Less: Reduction in Regulatory Equity during

the year due retirement of assets

6.97

6.49

6.73

6.61




of the year 219.86 233.95 247.81 263.91

Return on Equity portion of capitalized 7.04 6.93 8.05 9.73


Page 129 of 302

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

expenditure


Retail+Wires

Regulatory Equity at the beginning of the year 1,574.73 1,674.01 1,772.52 1,886.90


Regulatory Equity at the end of the year 1,674.01 1,772.52 1,886.90 2,022.75


of the year 247.21 262.77 278.22 296.16

Return on Equity portion of capitalized

expenditure 7.78 7.72 8.97 10.63


3.12 Operations and Maintenance Expenditure

3.12.1 Operations and Maintenance Expenditure

3.12.1.1 RInfra-D submitted that:

a) Prior to issuance of the final MERC MYT Regulations, 2011, the Commission

had issued the Draft Multi Year Tariff Regulations (referred to as “Draft

Regulations”) for public consultation on 30 August, 2010.

b) The norms for O&M expenditure were specified in Clauses 73.3 and 87.6 of

the Draft Regulations for the Distribution Wires business and the Retail Supply

business respectively.

c) There was a significant difference between the norms specified in the Draft

Regulations, consulted upon with the utilities and members of public and those

specified in the final Regulations.

d) RInfra-D submitted that the change in O&M norms between the Draft

Regulations and Final Regulations had significantly reduced the total allowable

O&M expenses to RInfra-D much lower than its actually incurred expenses.

3.12.1.2 RInfra-D also submitted the comparison of the O&M Expenses calculated based on

the norms specified as in the MERC MYT Regulations 2011, the actual expenses as

per Audited Accounts for FY 2011-12 and the O&M expenses and as approved by

the Commission in its Order in Case No. 180 of 2011 as given in the table below:


Page 130 of 302

Table 92: Comparison of O&M Expenses as submitted by RInfra-D

Particulars

MYT

Regulations,

2011

Actual

Expenses

Approved Expenses as

per Order in Case No.

180 of 2011

Employee Expenses 427.04 401.96

A&G Expenses 139.96 146.44

R&M Expenses 167.01 185.05

Total Expenses 558.69 734.01 733.44

3.12.1.3 RInfra-D further submitted that, in its Business Plan Petition, it has highlighted that

the migration of consumers from RInfra-D to TPC-D for supply would not alter the

O&M expenses in any significant manner as the only activities that would be

discontinued for Changeover consumers would be bill printing and bill distribution.

All other activities would continue to remain, just the same way as presently done

for own consumers. Further, the effect of migration – whether on own network or to

another network – would also be offset by natural addition of consumers to the

licensee’s fold. Hence, the distribution network activities are not likely to see any

change on account of change-over or switchover of consumers. Similarly, the

supply activities only reduce to a minor extent.

3.12.1.4 RInfra-D submitted that even though its retail supply business is witnessing

competition and consumer migration at present, the O&M expenses shall be reduced

marginally over the Plan Period. RInfra-D further indicated that it is still carrying

out a number of its usual business activities even for changeover consumers. These

activities primarily include:

a) Regular monthly meter reading of Changeover consumers to validate the

consumption data being shared by TPC, as RInfra-D is responsible for

maintaining the distribution system losses.

b) Meter replacement during Joint Meter Reading (JMR), if consumer wants SDL

(Supply Distribution Licensee) meter.

c) Accompanying TPC-D representative for recovery of arrears and disconnect the

supply if TPC-D dues are not paid by the changeover consumers;


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d) Accompanying TPC-D representatives for on-site activities such as meter

testing, meter replacement, consumer complaints related to meter/metering

equipment, etc.;

e) Continued (and increased) vigilance efforts for changeover consumers, as TPC-

D is unaffected by such theft as its losses are fixed at normative level which do

not even include commercial losses including theft of electricity;

f) Follow-up activities such as monitoring and improvement of power factor, etc.

for changeover consumers, RInfra-D added that while poor PF of the

changeover consumers overload the distribution of RInfra-D, however it is TPC-

D who retains PF surcharge recovered from the changeover consumers

g) Coordinating with TPC-D for jobs such as service shifting, load enhancement,

etc. such as monitoring and power factor improvement for changeover

consumers, etc.

3.12.1.5 RInfra-D submitted that however, in its Order on the Business Plan in Case No. 158

of 2011 dated 23 November, 2012, the Commission only computed O&M expenses

for each year of the MYT Period as per the MYT Regulations, 2011. RInfra-D

submitted that the Commission may kindly review its decision under Regulation

100 (Power to Remove Difficulties) of the MYT Regulations, 2011 so as to provide

a more representative allowance of O&M expenses for the MYT Period, which is

relatable to past expenses. RInfra-D further submitted that because the O&M norms

specified in the MERC MYT Regulations 2011 lead to lower base value of

expenses, all expenses to be allowed in future based on the norms would also be

much lower than the actual expenses. RInfra-D submitted that this would lead to

significant financial difficulties in terms of managing day to day network

operations, paying salaries and wages to employees, making payments to vendors,

etc. Such significant reduction in allowed expenses would naturally lead to

significant cost cutting if RInfra-D is forced to manage its operations within those

expenses, which will have negative impact on quality and reliability of supply.


Page 132 of 302

3.12.1.6 RInfra-D submitted its approach adopted in the MYT Petition for calculation of the

O&M expenses for the second control period (FY 2012-13 to FY 2015- 16) as given

below:

a) As FY 2012-13 is almost over, the actual expenses for the first half of FY

2012-13 and estimates for the second half are used to estimate the expenses of

FY 2012-13, which were considered as base expenses for the MYT Period.

b) Inflation based indices (Consumer Price Index & Wholesale Price Index) were

then applied to the base year number to arrive at the annual expenses for each

of the O&M categories for the period FY 2013-14 to FY 2015-16

c) Certain arrears and one-time expenses in FY 2012-13 estimates were not

escalated, but considered separately by RInfra-D.

d) RInfra-D proposed to recover charges for usage of SCADA system from

RInfra-T. Such recovery has been reduced from each head of O&M expenses.

3.12.1.7 RInfra-D submitted that, RInfra has established a State of the Art System Control

Centre at Aarey. RInfra-T does not have a separate SCADA centre, but the existing

System Control Centre caters to entire Transmission and Distribution Network of

RInfra in Mumbai area.

3.12.1.8 RInfra-D further submitted that as per prevailing practice, entire cost of this control

centre is being considered in RInfra-D ARR. However, with effect from FY 2012-

13, RInfra-D intends to apportion the costs applicable to the operations pertaining to

RInfra-T. For FY 2012-13, the actuals have been considered till October 2012 and

the same is annualised for the entire year and the effect of the same is considered.

The projection for FY 2013-14 to FY 2015-16 has been arrived at after considering

the escalation of 7.57% year on year basis for employee expenses, escalation of

7.16% YoY basis for A&G expenses and escalation of 6.89% year on year basis for

R&M expenses, in line with the Commission approved escalation for Employee and

A&G expenses in its Order in Case No. 167 of 2011.

3.12.1.9 Further, as a part of reply to data gaps, RInfra-D submitted its actual (based on

provisional account) O&M expenses including corporate allocation for FY 2012-13

as:


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a) Employee Expenses: Rs. 594.98 Crore

b) A&G expenses : Rs. 159.21 Crore

c) R&M expenses : Rs. 225.07 Crore

3.12.2 Employee Expenses

3.12.2.1 RInfra-D submitted that it has estimated the employee expenses for the period FY

2012-13 to FY 2015-16 by considering impact of wage revision and the effect on

inflation.

3.12.2.2 RInfra-D submitted that the wage agreement was revised in July 2012, with wage

revision effective from July 2010 onwards. The Actual Employee expenses in FY

2011-12 was Rs 427.04 Crore and in FY 2012-13 it is Rs 538.22 Crore. RInfra-D

submitted various factors for increase in employee cost as given below:

a) Wage agreement of Non-executives in July 2012 which was effective from

July 2010. On account of wage revision an amount of Rs. 16 Crore is

pertaining to FY 2010-11 and Rs. 24 Crore pertaining to FY 2011-12 has been

accounted in FY 2012 -13. RInfra-D submitted that this is a onetime expense

for the past arrears

b) Normal annual increment of executives

c) Compounding effect on Gratuity & Leave Encashment Liability due to wage

revision.

3.12.2.3 RInfra-D further submitted that there was an impending wage revision for unionised

employees due from 1 July, 2010 and another wage revision would be due by the

end of the MYT period. RInfra-D revises wages of the unionised employees every

four years as well as for the staff in the officers and supervisory category.

3.12.2.4 Further, it was submitted that the projected employee expense for FY 2012-13 of the

RInfra-D is then escalated by 9.28% (based on Consumer Price Index (CPI) for the

period 2007-12) to arrive at the Employee expenses for the period FY 2013-14 to

FY 2015-16.

3.12.2.5 The summary of the employee expenses for the period FY 2012-13 to FY 2015-16

as submitted by RInfra-D is given in the table below:


Page 134 of 302

Table 93: Summary of Employee Expenses as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Employee Expenses 498.22 544.45 594.98 650.19

Add: Past Period Adjustments 40.00

Less: SCADA Charges from RInfra-T 0.96 1.05 1.15 1.26

Total Employee Expenses 537.26 543.40 593.83 648.94

3.12.3 Administrative and General Expenditure

3.12.3.1 RInfra-D submitted that the actual A&G expenses in FY 2011-12 were Rs. 139.96

Crore. The A&G expenses have been projected considering two categories. Firstly,

expense for the FY 2011-12 is escalated annually by an inflation index to arrive at

projected A&G expenses for the years from FY 2012-13 to FY 2015-16.

3.12.3.2 RInfra-D considered Inflation index for projecting A&G expense which was a mix

of 60% CPI and 40% WPI. Secondly, estimates are separately considered for

charges relating to usage of RInfra – Transmission (RInfra-T) land for installations

of RInfra-D.

3.12.3.3 The summary of the A&G expenses for the period FY 2012-13 to FY 2015-16 as


Table 94: Summary of A&G Expenses as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

A&G Expenses 170.00 184.24 199.68 216.42

Add: Past Period Adjustments 1.60 1.60 1.60 1.60


Total A&G Expenses 171.54 185.78 201.22 217.95

3.12.4 Repairs and Maintenance Expenditure

3.12.4.1 RInfra-D submitted that the actual R&M Expenses for FY 2011-12 were Rs. 167.01

Crore which increased to Rs. 230 Crore in FY 2012-13. RInfra-D submitted that the

increase is largely due to uncontrollable factors as given below:


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a) Wage agreement of Contracted labourers in July 2012 with effect from July

2010. Since contracted labourers do not form a part of the employee expenses

they are considered in R&M.

b) Increase in material consumption cost from the previous year due to non-

receipt of many materials in FY 2011-12.

3.12.4.2 RInfra-D further submitted that the projected Repair and Maintenance expense for

FY 2012-13 is then escalated by 7.02% (Based on Wholesale Price Index (WPI) for

the period 2007-12) to arrive at the Repair and Maintenance expenses for the period

FY 2013-14 to FY 2015-16.

3.12.4.3 The summary of the R&M expenses for the period FY 2012-13 to FY 2015-16 as


Table 95: Summary of R&M Expenses as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

R&M Expenses 200.00 214.04 229.07 245.15

Add: Past Period Adjustments 30.00


Total R&M Expenses 229.79 213.82 228.83 244.89

3.12.4.4 RInfra-D further submitted that it considered Inflation Indices based on Consumer

Price Index (CPI) and Whole Sale Price Index (WPI) for the purpose of escalating

O&M Expenses. For escalating Employee Expenses, Inflation index based on CPI

was considered. The data for CPI was taken from the website of the Labour Bureau,

Govt. of India. For estimating R&M Expenses, RInfra-D considered Inflation index

based on WPI. The data for WPI was taken from the Office of Economic Advisor,

Govt. of India. RInfra-D considered mix of 60% CPI and 40% WPI for projecting

A&G expenses. The indices considered by RInfra-D for projecting O&M Expenses

are as given in the table below:

Table 96: Summary of Indices used by RInfra-D to project O&M Expenses


Page 136 of 302

Index Basis Value

Employee Expense CPI 9.28%

Repairs and Maintenance WPI 7.02%

Administrative Expenses Mix of CPI and WPI 8.38%


3.12.5.1 The Commission accepts RInfra-D contentions that the O&M expenses in

subsequent years cannot be approved at levels lower than the approved values of the

past years. Although, the Commission is of the view that licensee should bring

enhanced productivity in its operations and consequently should induce reduction in

O&M expenses for controllable factors, however the increase on account of

uncontrollable factors like wage revision of the past period and inflation, cannot be

done away with.

3.12.5.2 The Commission notes the submissions of RInfra-D that it is still carrying out a

number of its usual business activities for changeover consumers, which are as

under:

Regular monthly meter reading of changeover consumers to validate the

consumption data being shared by Tata Power Company as RInfra-D is responsible

for maintaining the distribution system losses. RInfra-D contended that the migrated

consumers are required to pay in kind only normative distribution system losses and

not the actual.

Meter replacement during Joint Meter Reading (JMR), if consumer wants SDL

(Supply Distribution Licensee) meter.

Accompanying SDL representative for recovery of arrears and disconnect the

supply if TPC-D dues are not paid by the changeover consumers;

Accompanying SDL representatives for on-site activities such as meter testing,

meter replacement, consumer complaints related to meter/metering equipment, etc.;


Page 137 of 302

Continued (and increased) vigilance efforts for changeover consumers, as SDL is

unaffected by such theft as its losses are fixed at normative level which not even

include commercial losses including theft of electricity;

Follow-up activities such as monitoring and improvement of power factor, etc. for

changeover consumers, RInfra-D added that while poor PF of the changeover

consumers overload the distribution of WDL, however it is SDL who retains PF

surcharge recovered from the changeover consumers

Coordinating with SDL for jobs such as service shifting, load enhancement, etc.

such as monitoring and power factor improvement for changeover consumers, etc.

3.12.5.3 The Commission observes that the assumption while framing Regulations was that

there would be reduction in O&M cost owing the consumers switching over to TPC-

D and it will in turn lead to optimisation of O&M Cost.

3.12.5.4 The Regulation 100 of the part K of the MERC MYT Regulations, 2011 vests the

Commission with the power to remove difficulties. The Regulation 100 is

reproduced hereunder:

“100 Power to remove difficulties

If any difficulty arises in giving effect to the provisions of these Regulations, the

Commission may, by general or specific order, make such provisions not

inconsistent with the provisions of the Act, as may appear to be necessary for

removing the difficulty.

3.12.5.5 The Commission exercising its power as provided under Regulation 100 of the

MERC (MYT) Regulations 2011 relaxes the O&M norms for RInfra-D provided

under Regulation 78.4.1 and Regulation 92.7.1.

3.12.5.6 RInfra-D in its reply to data gaps has submitted the actual O&M expenses for FY

2012-13 and certified Reconciliation statement and also submitted following

justification to increase in O&M expenses:


Page 138 of 302

Particulars FY 10-11 FY 11-12 FY 12-13 Average Growth rate

for FY 12-13

Actuals as per ARR 388.5 427.04 592.49

Wage Revision Impact 32 52 (84)

Total 420.5 479.04 508.49 6.15%

Particulars FY 10-11 FY 11-12 FY 12-13 Average Growth rate

for FY 12-13

Actuals as per ARR 186.28 167.01 225.07

Wage Revision Impact 16.38 11.25 (27.63)

Total 202.66 178.26 197.44 6.83%

3.12.5.7 RInfra-D also submitted the A&G expenses for FY 2012-13 as Rs 153.93 Crore.

3.12.5.8 The Commission for the purpose of approving O&M cost has considered the actuals

of FY 2012-13 and escalation rates of 6.15%, 6.83% for employee expenses and

R&M, respectively, based on the average growth rate submitted by RInfra-D in the

reply to data gaps mentioned above. The Commission has computed a escalation

rate of A&G expenses based on 60% weightage of growth rate of employee

expenses (6.15%) and 40% weightage of growth rate of R&M expenses (6.83%).

The Commission has not considered wage revision impact of Rs 27.63 Crore on

R&M expenses as submitted by RInfra-D, as RInfra-D has not substantiated its

claim. The Commission directs RInfra-D to submit justification of the above

mentioned wage revision impact with proper justification in the next tariff

determination process for the consideration of the Commission, subject to prudence

check. The Commission has applied same ratio for allocation to wires and supply

business as submitted by RInfra-D and reduced SCADA charges from RInfra-T as

submitted by RInfra-D in its Petition.

3.12.5.9 The O&M expenses approved by the Commission are as under:

Table 97: O&M Expenses approved by the Commission (Rs Crore)


Total O&M (Wires +Supply) 942.63 913.17 971.16 1032.86

Wires Business 636.48 611.41 649.01 688.95

Supply Business 306.15 301.77 322.16 343.91


Page 139 of 302

3.13 Interest on Working Capital and Security Deposits

3.13.1 RInfra-D’s Submission

3.13.1.1 RInfra-D submitted that for the computation of the value of sum of the book value

of stores, materials and supplies for FY 2012-13 it has considered the same amount

as the actuals for FY 2011-12. For ensuing years an escalation rate is used which is

based on the growth rate of the total line length (ckt-km) for the business.

3.13.1.2 RInfra-D submitted that it computed Interest on Security Deposit based on

Consumer Security Deposit (CSD) estimates and interest rate considered. RInfra-D

considered CSD for FY 2011-12, as submitted in its True-Up Petition in Case No.

124 of 2012. CSD for the period FY 2015-16 was estimated by escalating the FY

2011-12 values by the respective year consumer growth rate.

3.13.1.3 RInfra-D further submitted that it the current bank rate of 9% for the purpose of the

forecast in accordance with Sub-clause c of the Regulation 35.4 of the MERC MYT

Regulations, 2011:

“Interest shall be allowed on the amount held as security deposit from

retail supply consumers at the Bank Rate as on the date on which the

application for determination of tariff is made.”

3.13.1.4 RInfra-D submitted the Interest on working capital for its Retail and Wires business

as given in the table below for the period from FY 2012-13 to FY 2015-16:

Table 98: Interest on Working Capital and Security Deposit for Wire & Retail Supply

Business as submitted by RInfra-D (Rs. Crore)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Interest on Working Capital-Wires 70.26 84.93 84.92 91.14

Interest on Working Capital-Retail 21.03 20.92 18.86 20.24

Total Interest on Working Capital 91.29 105.85 103.78 111.39



Page 140 of 302

3.13.2.1 The Commission has approved Interest on Working Capital and security Deposit, in

accordance with Regulation 35.3 and 35.4 of the MERC MYT Regulations, 2011,

the Interest rate on working capital was calculated at the prevailing State Bank

Advance Rate (SBAR) which was 14.50% at the time of filing of MYT Petition,

which is as under:

“35.3 Distribution Wires Business:

(a) The Distribution Licensee shall be allowed interest on the estimated

level of working capital for the Distribution Wires Business for the

financial year, computed as follows:

(i) One-twelfth (1/12) of the amount of Operation and Maintenance

expenses for such financial year; plus

(ii) One-twelfth (1/12) of the sum of the book value of stores, materials

and supplies including fuel on hand at the end of each month of such

financial year; plus

(iii) Two (2) months equivalent of the expected revenue from charges for

use of Distribution Wires at the prevailing tariff; minus

(iv) Amount held as security deposits from Distribution System Users.

(b) Rate of interest on working capital shall be on normative basis and

shall be equal to the State Bank Advance Rate (SBAR) of State Bank of

India as on the date on which the application for determination of tariff is

made.

(c) Interest shall be allowed on the amount held as security deposit from

Distribution System Users at the Bank Rate as on the date on which the

application for determination of tariff is made.

35.4 Retail Supply of Electricity

(a) The Distribution Licensee shall be allowed interest on the estimated

level of working capital for the financial year, computed as follows:

(i) One-twelfth (1/12) of the amount of Operation and Maintenance

expenses for such financial year; plus


Page 141 of 302

(ii) One-twelfth (1/12) of the sum of the book value of stores, materials

and supplies including fuel on hand at the end of each month of such

financial year; plus

(iii) Two (2) months equivalent of the expected revenue from sale of

electricity at the prevailing tariff; minus

(iv) Amount held as security deposits under clause (a) and clause (b) of

sub-section (1) of Section 47 of the Act from retail supply consumers;

minus

(v) One (1) month equivalent of cost of power purchased, based on the

annual power procurement plan:

Provided that in case of power procurement from own Generating

Stations, no amount shall be allowed towards payables, to the extent of

supply of power by the Generation Business to the Retail Supply Business,

in the computation of working capital in accordance with these

Regulations.

(b) Rate of interest on working capital shall be on normative basis and

shall be equal to the State Bank Advance Rate (SBAR) of State Bank of

India as on the date on which the application for determination of tariff is

made.

(c) Interest shall be allowed on the amount held as security deposit from

retail supply consumers at the Bank Rate as on the date on which the

application for determination of tariff is made.”

3.13.2.2 The summary of approved Interest on Working Capital and security Deposit is as

under:

Table 99: Interest on Working Capital for Wire & Retail Supply Business approved by the

Commission (Rs. Crore)


Retail Supply 70.26 72.65 63.92 52.78

Wires 21.54 24.91 27.07 29.43

Total 91.80 97.56 90.99 82.21


Page 142 of 302

3.14 Income Tax

3.14.1 RInfra-D’s Submissions

3.14.1.1 RInfra-D submitted that in its Business Plan Order in Case No. 158 of 2011 the

Commission approved income tax equivalent to an amount approved by the

Commission in its Order in Case No. 180 of 2011 dated 15 June, 2012. In the Order

in Case No. 180 of 2011, the Commission computed income tax based on the Profit

before tax method and had allowed income tax on the segmental profit. The same

income tax amount of Rs.53.87 Crore (for wires and retail supply business put

together) for RInfra-D was considered as allowable for the second control period in

the Business Plan Order.

3.14.1.2 The details of the income tax projections as submitted by RInfra-D, is as given in

the table below:

Table 100: Income Tax projections as submitted by RInfra-D (Rs. Cr)


Income Tax (Retail) 46.17 46.17 46.17 46.17

Income Tax (Wires) 7.70 7.70 7.70 7.70

Total Income Tax 53.87 53.87 53.87 53.87


3.14.2.1 For computation of income tax for FY 2012-13 to FY 2015-16, the MERC (MYT)

Regulations, 2011 specifies that the Commission may provisionally approve income

tax payable for each year of the MYT second control period based on the actual

income tax payable as per the latest audited accounts and the variation between the

actual and approved income tax shall be reimbursed at the time of mid-term

performance review. The said Regulation is reproduced below for reference:

“34.1 The Commission in its MYT Order shall provisionally approve Income Tax

payable for each year of the Control Period, if any, based on the actual income

tax paid on permissible return as allowed by the Commission relating to

electricity business regulated by the Commission, as per latest Audited Accounts

available for the applicant, subject to prudence check.


Page 143 of 302

...

34.2 Variation between Income Tax actually paid and approved, if any, on the

income stream of the regulated business of Generating companies, Transmission

licensees and Distribution licensees shall be reimbursed to /recovered from the

Generating Companies, Transmission Licensees and Distribution Licensees,

based on the documentary evidence submitted at the time of Mid-term

Performance Review and MYT Order for the third Control Period, subject to

prudence check."

3.14.2.2 Since, the recovery of the Income Tax through the ARR and tariffs will be viewed

as income by the Income Tax authorities, the Income Tax component for FY 2011-

12 has to be duly grossed up by the applicable tax rate (Corporate tax rate of

33.99% or MAT rate of 20.96%) in the year of recovery, in accordance with the

various Judgments issued by the Hon'ble ATE in this regard. Accordingly, the

Income Tax amount of Rs. 0 Crore considered for recovery for FY 2011-12, has

been grossed up by the applicable tax rate, thereby, resulting in an amount of Rs. 0

Crore to be allowed for recovery, in the next tariff period when it is actually offered

to tax.

3.14.2.3 In accordance with the MERC MYT Regulations, 2011, the Income Tax for FY

2012-13 to FY 2015-16 will have to be considered at the same level as approved by

the Commission for FY 2011-12 (Rs 0 Crore), which has been grossed up for

income tax, since that is the latest year for which audited accounts/ information has

been submitted and prudence check has been undertaken by the Commission.

Further, the true up based on actual Income Tax paid by RInfra-D shall be

considered at the time of mid-term review by the Commission.

3.14.2.4 The income tax considered by the Commission for the years under consideration for

the MYT second control period starting from FY 2012-13 to FY 2015-16 is as

summarised in the table below:-

Table 101: Income tax approved by the Commission (in Rs. Crore)


Income tax 0.00 0.00 0.00 0.00


Page 144 of 302

3.14.2.5 Further, as per Regulation 34 of the MERC MYT Regulations, 2011, the

distribution company is required to bill the income tax under a separate head called

“Income Tax Reimbursement”. However, if income tax is allowed as separate

reimbursement, it may lead to some problems in claiming expenses with income tax

authorities. In view of this, the Commission in exercise of its powers under

Regulation 100 “Power to remove difficulties” of the MERC (MYT) Regulations,

2011 hereby orders that the difficulty in implementing Regulation 34 stands

removed by allowing the inclusion of income tax expense as a part of the annual

revenue requirement.

3.15 Contribution to Contingency Reserves


3.15.1.1 RInfra-D submitted that it has projected for Contingency Reserve Contributions

during the MYT plan period by considering 0.25% of opening GFA value as

contribution to Contingency Reserve. It is in accordance with Regulation 36.1 of the

MERC MYT Regulations, 2011:

“36.1 Where the Transmission Licensee or Distribution Licensee has

made an appropriation to the Contingency Reserve, a sum not less than

0.25 per cent and not more than 0.5 per cent of the original cost of fixed

assets shall be allowed annually towards such appropriation in the

calculation of aggregate revenue requirement:…”

3.15.1.2 The details of contribution to Contingency Reserves as submitted by RInfra-D, is as

under:

Table 102: Contribution to Contingency Reserves as submitted by RInfra-D (Wires, Rs.

Crore)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening balance of GFA 3644.68 3968.32 4317.42 4762.9

% Contribution 0.25% 0.25% 0.25% 0.25%

Contribution to Contingency Reserve 9.11 9.92 10.79 11.91


Page 145 of 302

Table 103: Contribution to Contingency Reserve as submitted by RInfra-D (Retail, Rs.

Crore)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Opening balance of GFA 506.55 534.68 565.02 600.24

% Contribution 0.25% 0.25% 0.25% 0.25%

Contribution to Contingency Reserve 1.27 1.34 1.41 1.50


3.15.2.1 The Commission has approved the contribution to contingency reserves as 0.25% of

approved Opening GFA, which is as under:

Table 104: Contribution to Contingency Reserve approved by the Commission (Rs. Crore)


13

FY 2013-

14

FY 2014-

15

FY 2015-

16

Wires 9.09 9.90 10.69 11.61

Retail Supply 1.27 1.34 1.41 1.50

Total 10.36 11.23 12.10 13.11

3.16 Non-Tariff Income


3.16.1.1 RInfra-D submitted that it analysed the various elements of Non-Tariff Income in

FY 2011-12 and segregated the same into escalable and non-escalable components.

The approach followed for forecasting non-tariff income by RInfra-D is as given

below:

a) For items such as miscellaneous receipts from consumers (except for any one

time arrears), burnt meter charges, connection, reconnection fee, etc., which

are effected by Schedule of Charges are forecast with a 10% escalation over

FY 2011-12 value, considering the fact that the Commission has revised the

Schedule of Charges.


Page 146 of 302

b) For other items such as delayed payment charges, interest on delayed payment

etc. similar approach of applying escalation factor of 10% is applied over the

FY 2011-12 value, to arrive at the projections from FY 2012-13 onwards.

c) Recovery from theft of power is not forecast with any escalation, but

considered at the same level as per actuals of FY 2011-12.

d) For projections of items such as rebate on power purchase and interest on

contingency reserve investments, a specific approach has been adopted as

under:

i. Rebate on Power Purchase: It was included in Non-Tariff Income in FY

2010-11 and FY 2011-12 in Case No. 124 of 2012. This was in pursuance of

a direction by the Commission in Case No. 180 of 2011. Further into the

MYT Period as the power purchase cost is not forecast considering any

rebate, an element of rebate has to be included in the Non-Tariff Income as

prompt payment discounts would be availed by RInfra-D going forward as

well. Therefore, in order to forecast rebate on power purchase, the rebate

amount of FY 2011-12 has been determined as a percentage of total power

purchase cost (except DTPS on which there is no prompt payment discount,

being own generator) and the percentage as worked out for FY 2011-12 is

considered same for each year of the MYT period going forward.

ii. Interest on Contingency reserve investments: In the case of interest on

contingency reserve investments, the weighted average rate of interest on

the investments as per the Annual accounts for FY 2011-12, pertaining to

distribution business, is arrived at. Next, the cumulative opening balance of

contribution to contingency reserve as at 1April,2012 is considered and to

this the yearly accretion to the contingency reserve for the second control

period from FY 2012-13 to FY 2015-16 is added to arrive at the closing

balance of contribution to contingency reserve at the end of each year. To

this closing balance so arrived at the end of each year, the weighted average

interest rate as mentioned above, is applied to arrive at the projected interest

on contingency reserve investments for each year of the second control

period from FY 2012-13 to FY 2015-16.


Page 147 of 302

3.16.1.2 In reply to the Commission’s query, RInfra-D submitted that the All-in-Hire charges

paid by BMC/MMRDA to RInfra-D on the Street Lighting Systems are accounted

in the ‘Miscellaneous receipts’ category of Non-Tariff Income (NTI). Further,

regarding submission of the details of actual recovery from theft of power in FY

2012-13, RInfra-D submitted the requisite information vide its reply dated 11

February, 2013 as given below:

Table 105: Actual recovery from theft of power for FY 13 till January 2013 as


Category Recovery (Rs. Crore)

LT-I Residential (Single phase) 6.18

LT-I Residential (Three phase) 1.28

LT-II (A) Commercial 8.67

LT-II (B) Commercial 0.17

LT-III Industrial 0.34

LT-IV Industrial 0.07

LT-V Advertisement & Hoardings 0.05

LT-VII (A) Temporary Supply Religious 0.01

LT-VII (B) Temporary Supply Others 0.48

Total 17.25

3.16.1.3 The details of Non Tariff Income as submitted by RInfra-D are as given in the table

below for Wire and Retail supply business:

Table 106:Non-tariff Income as submitted by RInfra-D for Retail supply (Rs. Crore)


13

FY 2013-

14

FY 2014-

15

FY 2015-

16

Non-Tariff Income - Retail

Supply 155.08 164.47 174.45 189.30

Table 107: Non-tariff Income as submitted by RInfra-D for Wires Business (Rs. Crore)


13

FY 2013-

14

FY 2014-

15

FY 2015-

16

Total Non-Tariff Income -

Distribution Wires 13.76 15.44 17.29 19.32


Page 148 of 302


3.16.2.1 The Commission has considered the income from land usage charges for EHV

stations that is proposed to be paid by RInfra-T to RInfra-D as non-tariff income for

its Wires business, as explained in Section 3.17 of this Order. RInfra-T will pay land

usage charges for its receiving stations installed on the land owned by RInfra-D at

Aarey, Versova and Ghodbunder EHV sub-stations.

3.16.2.2 The Commission has considered the rental income for Devidas lane office that is

proposed to be paid by corporate business to RInfra-D as non-tariff income for its

Supply business, as explained in Section 3.17 of this Order.

3.16.2.3 The Commission has accepted the submission of RInfra-D and approved the Non-

tariff Income, which is as under:

Table 108:Non-tariff Income approved by the Commission for Retail supply (Rs. Crore)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Non-Tariff Income - Retail Supply 162.51 172.65 183.44 198.29

Table 109: Non-tariff Income approved by the Commission for Wires Business (Rs. Crore)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Total Non-Tariff Income - Wires 20.67 22.35 24.20 26.23

3.17 Income from Other Businesses


3.17.1.1 RInfra-D submitted that it considered recovery of costs presently being borne by it

pertaining to certain common assets being used by RInfra-T. Such recovery would

form part of the Income from Other Business.

3.17.1.2 RInfra-D submitted that its old Corporate Office building at Santacruz (E) is

presently under construction. Accordingly, some of the Corporate Office employees

(i.e. employees of other group companies of RInfra) are accommodated temporarily

at RInfra-D’s Devidas Lane Office till such time the building at Santacruz is


Page 149 of 302

constructed and occupied. A Minute of Meeting has been signed in this regard,

which gives out the details of area to be occupied by corporate business, including

shared facilities and the rental to be charged by RInfra-D for the same. This revenue

is arising on account of optimum utilisation of distribution business assets (Devidas

Lane building is a regulated asset of Distribution business). Accordingly, as per the

Regulations, only 1/3rd

of the rental should be included in the ARR and that too as

“Income from Other Business”. For each year of the MYT Period, RInfra-D further

submitted that such rental income has been projected as per the arrangement worked

out between RInfra-D and the Corporate Business and same in given in the table

below:

Table 110: Income from Devidas Lane office as submitted by RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Area occupied by Corporate business

(Office / Shared) 53,089 53,089 53,089 53,089

Rate (per sq. ft) 116.67 128.34 141.17 155.29

Total Rental Income from Devidas Lane

office (Rs Crore) 7.43 8.18 8.99 9.89

3.17.1.3 Land Usage Charges: RInfra-D submitted that as a part of Mumbai System

Strengthening schemes, RInfra-T had put up DPRs for EHV stations. Post approval

from STU and MERC, schemes were taken up for commissioning. Conventional

AIS EHV stations require over 40,000 sq mtr space. Such a large portion of land is

not available within the City limits. Hence, RInfra-T innovatively based on the latest

technology, vertically configured GIS EHV stations, which can be accommodated in

just 10% of space than conventional AIS EHV stations require. RInfra-D submitted

that the Commission in the proceedings of the Business Plan petition of RInfra-T in

Case No. 159 of 2011 raised a query on the land leased / owned by RInfra-T. As

part of the response vide letter dated 20 August, 2012 bearing reference no.

RInfra/MERC/Business Plan/Transmission/003, RInfra-T submitted the requisite

information. RInfra-T also submitted that an appropriate arrangement will be

formalized with RInfra-D.


Page 150 of 302

3.17.1.4 In view of above, RInfra-D submitted that it intends to enter into an arrangement by

way of (Memorandum of Understanding) MoU, with RInfra-T, wherein the Land

usage charges would be payable by RInfra-T to RInfra-D for the EHV Stations

located on RInfra-D land. Similarly, Land usage charges would be payable by

RInfra-D to RInfra-T for the installations located on RInfra-T land. Accordingly, the

amounts receivable by RInfra-D from RInfra-T are considered under Income from

other business, while the amounts payable by RInfra-D to RInfra-T for installations

of RInfra-D on RInfra-T land have been considered in the Administration & General

expenses, as part of the O&M for the second control period. RInfra-D submitted

brief methodology as:

a) The total plot area is considered after deducting setback area for each of the

eight locations based on the documented Municipal approved copy.

b) The plot occupied by RInfra-T and RInfra-D within these locations is

determined based on their respective T&D installations on site.

Land usage charge:

c) The Commission in the ARR Order for FY 2011-12 for RInfra-D in Case No.

180 of 2011 has considered rent at the rate of 1% per month for the purpose of

determining the rental income.

d) RInfra-D accordingly has computed annual Land usage charge at 12% of the

Land valuation in proportion to land occupancy of RInfra-T and RInfra-D.

e) Value of the land is worked out based on present Ready Reckoner rate (in Rs.

/sq. mtr) for each of the plots. The proportion of land occupancy by RInfra-T

and RInfra-D is then multiplied by the rate to arrive at the land valuation.

RInfra-D submitted that, RInfra-T wishes to submit that rates as applicable as

per the Ready Reckoner on the date of entering into MoU shall be considered for

the purpose of calculating the valuation.

f) The NA tax and the Property tax paid for FY 2011-12 is considered to be the

same for FY 2012-13 onwards and the same is allocated based on the proportion

of Land occupancy between RInfra-T and RInfra-D.


Page 151 of 302

3.17.1.5 RInfra-D submitted that Land usage charges are related to usage of the Distribution

Wires assets and therefore these were considered in the income from other business,

as per the MERC MYT Regulations, 2011:

“80.1 Where the Distribution Licensee has engaged in any Other

Business, an amount equal to one-third of the revenues from such Other

Business after deduction of all direct and indirect costs attributed to such

Other Business shall be deducted from the Aggregate Revenue

Requirement in determining the wheeling charges of Distribution Wires

Business of the Distribution Licensee:”

3.17.1.6 Further, RInfra-D submitted that it has let out its receiving station roof-tops to

Reliance Communication Ltd. for installation of BTS towers and other equipment.

The transaction is on arms length basis and has been done under an agreement dated

21 April, 2010. Accordingly, as per the provisions of Regulations, 1/3rd of rent

received would be considered as Income and to reduce the ARR of distribution

wires business (as this income pertains to utilisation of wires assets only, no

adjustment is considered in retail business ARR). The rent agreement provides for

an escalation in rental of 25% after five years. The rental income has been

considered as per the annual accounts for FY 2011-12. The same is considered

constant up to FY 2014-15 and escalated by 25% for FY 2015-16 as per the terms of

the Agreement and 1/3rd is considered as Income from Other Business for the

purpose of reducing the ARR of distribution business in each year of the Plan

Period.

3.17.1.7 In addition to above, RInfra-D also submitted that it has entered into an arrangement

with an advertising firm to put up advertisement kiosks on street light poles in Mira

Bhayander area. The kiosks shall generate rental income for RInfra-D and shall also

entail certain expenses of capital and maintenance nature. RInfra-D submitted that it

has already intimated the Commission about the said arrangement vide letter dated 9

September, 2011. For FY 2011-12, the net income to be reduced from wheeling

ARR is considered as per the Petition of RInfra-D in Case No. 180 of 2011, and

thereafter estimated.


Page 152 of 302

3.17.1.8 The details of the Income from other business as submitted by RInfra-D during

second Control Period of the MYT is as given in table below:

Table 111: Income from other business as submitted by RInfra-D (Rs. Cr)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Rental Income from Devidas Lane office 7.43 8.18 8.99 9.89

Land Usage Charges (EHV Station) 6.91 6.91 6.91 6.91

Income from Other Business - rental income

from RCom Towers 0.6 0.6 0.6 0.75

Income from Other Business - advertisement

Kiosks 0.16 0.16 0.66 0.93

Total (A) 15.1 15.85 17.16 18.48

B – 1/3rd of (A) considered as income from

other business 5.03 5.28 5.72 6.16


3.17.2.1 RInfra-D in the present Petition has proposed to account for the land usage charges

received from the RInfra-T in lieu of utilisation of RInfra-D’s land and rental

income from Devidas lane office, as income from other business. The Commission

opines that this income is recognised only to correctly account the costs involved in

business operations of the respective licensees. Also it is important to reflect the true

expenditure for each of the licensed business and also recover the same from the

respective licensee’s consumer. In the present case, the expense and income is

occurring between the regulated businesses of the same parent company in the same

State.

3.17.2.2 The Commission considering the above is not accepting the proposal of RInfra-D to

treat this as income from other business and the same is approved as non-tariff

income.

3.17.2.3 The Commission has accepted the submission of RInfra-D for other heads under

income from other business and approved the Income from other business as under:

Table 112: Income from other business approved by the Commission (Rs. Crore)


Page 153 of 302

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Income from other business 0.25

0.25

0.42

0.56

3.18 Past Recovery of TPC-G

3.18.1.1 The Commission approved the past recoveries of the TPC-G, while carrying out the

truing up for FY10 and FY11, vide Order dated 15 February, 2012 in Case No. 105

of 2011.

3.18.1.2 TPC-G filed a petition with the Commission under Case No.55 of 2012 on the

grounds that the Commission did not give any specific directions to the distribution

utilities for payment of such recovery and TPC-G was facing cash flow problems

due to the past under recoveries. The quantum of the past recoveries sought by TPC-

G was of the tune of Rs 84.50 Crore.

3.18.1.3 RInfra-D has considered the above mentioned charges of Rs.84.50 Crore payable by

RInfra-D, as a cost in the present MYT petition, in FY 13-14.

3.18.1.4 The Commission in this Order has considered Rs 165.68 Crore as approved in its

Order dated5 June 2013 in Case No. 177 of 2011 in the matter of petition filed by

TPC-G, for approval of Aggregate Revenue Requirement for FY 2011-12 and Multi

Year Tariff petition for the second Control Period from FY 2012-13 to FY 2015-16.

3.18.1.5 The Commission has also considered interest on FAC charges that is passed on to

consumers of Rs 2.96 Crore, as FAC charged to the consumers includes this amount

and since same is considered in the revenue side, hence, the Commission has also

allowed Rs 2.96 Crore as an expense item in ARR.

3.19 Wire Availability and Supply Availability

3.19.1 Wire Availability

3.19.1.1 As regards Wires Availability, Regulation 84 of MERC MYT Regulations, 2011

specifies as follows:


Page 154 of 302

“84.1 The target Wires Availability for full recovery of Return on Equity Capital

for Wires Business shall be as under:

(a) Rural Areas 90 percent

(b) Towns and cities 95 percent

Provided that the Commission may stipulate a trajectory for achieving the target

Availability for Wires Business of the Distribution Licensee as part of the Order

on the Business Plan filed by the Distribution Licensee:

Provided further that for every 1 percent under-achievement in Wires

Availability, Rate of Return on Equity Capital shall be reduced by 0.1%:

Provided further that for every 1 percent over-achievement in Wires Availability,

Rate of Return on Equity Capital shall be increased by 0.1%.

84.2 Wires Availability shall be computed in accordance with the following

formula:

Wires Availability = (1- (SAIDI / 8760)) x 100 where

Provided that the SAIDI shall be calculated in accordance with the definition

specified in Maharashtra Electricity Regulatory Commission (Standards of

Performance of Distribution Licensees, Period for Giving Supply and

Determination of Compensation) Regulations, 2005, as amended from time to

time.

84.3 Wires Availability shall be measured over the course of a year and shall be

expressed in percentage terms.”

3.19.1.2 RInfra-D in reply to data gaps, has submitted that its wires availability for last two

year is 99.98%, which is shown as under

S.No. Particulars FY 2011-12 FY 2012-13

Actuals Actuals

a) SAIDI (in Hrs) 1.6 2.1

b) Wires Availability (%) 99.98 99.98


Page 155 of 302

3.19.1.3 As regards the target for Wires availability, the Commission has analysed the data

submitted by RInfra-D, i.e., actuals for FY 2011-12 and FY 2012-13 from which it

is observed that wires availability for RInfra-D is 99.98% for FY 2011-12 and FY

2012-13. Accordingly, the Commission has stipulated the trajectory of Wires

Availability at 99.98% during the Control Period. Further, the reduction and

increase in ROE shall be computed below/ above the stipulated target based on the

under/over achievement vis-a-vis the set target of Wires Availability by RInfra-D.

3.19.2 Supply Availability

3.19.2.1 As regards Supply availability, Regulation 97 of MERC MYT Regulations, 2011

specifies as follows:

“Supply Availability shall comprise of the following parameters in the proportion

as mentioned below:

(a) Base load Supply Availability 75 percent

(b) Peak load Supply Availability 25 percent

97.2 Target Supply Availability for full recovery of Return on Equity Capital for

Retail Supply of electricity is in the range of 85 percent to 95 percent, as may be

determined by the Commission as part of the Order on the Business Plan filed by

the Distribution Licensee:

Provided that the Commission may stipulate a trajectory for achieving the target

Supply Availability for Retail Supply of electricity as part of the Order on the

Business Plan filed by the Distribution Licensee:

Provided that for every 1 percent under-achievement in Supply Availability, rate

of Return on Equity Capital shall be reduced by 0.1%.

Provided that for every 1 percent over-achievement in Supply Availability, rate of

Return on Equity Capital shall be increased by 0.1%.

97.3 Base load Supply Availability shall be computed in accordance with the

following formula:

= (Actual Contracted Base Load Supply in MW) ÷ (Base load in MW)

Provided that the base load shall be calculated based on unrestricted demand of a

Distribution Licensee for the retail supply of electricity.


Page 156 of 302

97.4 Peak load Supply Availability shall be computed in accordance with the

following formula:

= (Actual Contracted Peak Load Supply in MW) ÷ (Peak load in MW)

Provided that the peak load shall be calculated based on unrestricted demand of

a Distribution Licensee for the retail supply of electricity.”

3.19.2.2 RInfra-D in reply to data gaps, has submitted that its supply availability for last two

year is 110% and 116%.

3.19.2.3 The Commission is of the view that in Mumbai Supply Area, load shedding is not

done, and the Distribution Licensees have been allowed to purchase high cost power

to avoid load shedding in extreme cases, and in such a scenario RInfra-D must have

Supply Availability of 100% during the Control Period. Any incentive/disincentive

for achieving Supply Availability above/below the targeted Supply Availability

shall be considered at the time of Truing-up.

3.20 Aggregate Revenue Requirement

3.20.1.1 Summary of ARR submitted by RInfra-D for FY 2012-13 to FY 2015-16 in its

Petition is as under:

Table 113: Aggregate Revenue Requirement submitted by RInfra-D- Retail Supply

Business (Rs. Crore)

S.No. Particulars FY12-13 FY13-14 FY14-15 FY15-16

1 Power Purchase Expenses 3523.37 3578.84 3276.20 3446.53

2 Operation & Maintenance Expenses 304.84 311.62 339.64 370.19

3 Depreciation Expenses

a) Depreciation 16.69 18.52 20.45 22.42

4 Interest on Long-term Loan Capital 16.54 17.46 18.44 19.35

5 Interest on Working Capital and on consumer security

deposits 70.26 84.93 84.92 91.14

6 Income Tax 46.17 46.17 46.17 46.17

7 Transmission Charges - intra-State 265.39 278.66 292.59 307.22

8 Contribution to contingency reserves 1.27 1.34 1.41 1.50

9 Total Revenue Expenditure 4244.53 4337.54 4079.82 4304.52

10 Return on Equity Capital 28.09 29.62 31.34 33.17

11 Aggregate Revenue Requirement 4272.62 4367.16 4111.16 4337.69


Page 157 of 302


12 Less: Non Tariff Income 155.08 164.47 174.45 189.30

13 Less: Income from Other Business 0.00 0.00 0.00 0.00

14 Add: TPC-G Charge 84.50

15 Aggregate Revenue Requirement from Retail Tariff 4117.54 4287.19 3936.71 4148.39

Table 114: Aggregate Revenue Requirement submitted by RInfra-D- Wires Business (Rs.

Crore)

S.No. Particulars FY

12-13

FY

13-14

FY

14-15

FY

15-16

1 Power Purchase Expenses



a) Depreciation 166.12 182.48 202.71 224.75


5 Interest on Working Capital and on consumer security

deposits 21.03 20.92 18.86 20.24

6 Income Tax 7.70 7.70 7.70 7.70







13 Aggregate Revenue Requirement from Wires

Business 1190.12 1225.93 1324.14 1436.07


Page 158 of 302

Table 115: Total Aggregate Revenue Requirement submitted by RInfra-D- (Retail Supply

+Wires) Business (Rs. Crore)


12-13

FY

13-14

FY

14-15

FY

15-16




a) Depreciation 182.81 201.00 223.16 247.17


5 Interest on Working Capital and on consumer

security deposits 91.29 105.85 103.78 111.39

6 Provisioning for Bad & Doubtful Debts 0.00 0.00 0.00 0.00

7 Other Expenses 0.00 0.00 0.00 0.00

8 Income Tax 53.87 53.87 53.87 53.87






0.00



16 Add: TPC-G Charge 0.00 84.50 0.00 0.00

17 Aggregate Revenue Requirement from

Retail and Wires Business 5307.66 5513.13 5260.85 5584.46

3.20.1.2 Summary of ARR approved by the Commission for FY 2012-13 to FY 2015-16 in

its Petition is as under:

Table 116: Aggregate Revenue Requirement approved by the Commission- Retail Supply

Business (Rs. Crore)





a) Depreciation 16.69 18.45 20.43 22.40





Page 159 of 302

6 Income Tax 0.00 0.00 0.00 0.00







13 Less: Income from Other Business

14 Add:TPC-G Charge 165.68

15 Interest on FAC charges 2.96


Retail Tariff 4099.09 4125.10 3859.19 4074.48

Table 117: Aggregate Revenue Requirement approved by the Commission- Wires Business

(Rs. Crore)


1 Power Purchase Expenses



a) Depreciation 165.73 181.25 198.71 218.59




6 Income Tax 0.00 0.00 0.00 0.00







13 Aggregate Revenue Requirement from Wires

Business 1152.53 1164.29 1240.13 1325.90


Page 160 of 302

Table 118: Total Aggregate Revenue Requirement approved by the Commission- (Retail

Supply +Wires) Business (Rs. Crore)

S.No. Particulars

FY12-13 FY13-14 FY14-15 FY15-16

Approved Approved Approved Approved




a) Depreciation 182.41 199.70 219.15 240.99




6 Provisioning for Bad & Doubtful Debts 0.00 0.00 0.00 0.00

7 Other Expenses 0.00 0.00 0.00 0.00

8 Income Tax 0.00 0.00 0.00 0.00








16 Add: TPC-G Charge 1.00 165.68 0.00 0.00

17 Add: Interest on FAC 2.96


Retail and Wires Business 5251.62 5289.39 5099.32 5400.38


Page 161 of 302

4. RECOVERY OF REGULATORY ASSET

4.1 Quantification of Regulatory Asset till FY 2011-12

4.1.1.1 RInfra-D submitted Regulatory Asset/Revenue Gap from FY 2006-07 till FY 2011-

12 without carrying cost till FY 2011-12 which was as claimed in its Petition in

Case No. 124 of 2012 (Final Truing up of FY 2010-11 and FY 2011-12) as Rs.

2661.27 Crore. It included Rs. 1795.37 Crore as already approved Revenue Gap by

the Commission in its Order in Case No. 180 of 2011 dated 15 June 2012. Further,

RInfra-D applied carrying cost on cumulative revenue gap till FY 2011-12 in

accordance with the Hon’ble ATE Judgment in RInfra-D Review Petition No.13 on

Appeal No.202/203 of 2010 dated 2 January, 2013. The relevant extracts of the

Judgment were submitted by RInfra-D as given below:

“15. Accordingly, paragraphs 11.5 & 11.6 of the judgment dated

13.9.2012 may be amended to read as under:

“11.5. The utility is entitled to carrying cost on its claim of legitimate

expenditure if the expenditure is:

accepted but recovery is deferred e.g. interest on regulatory assets, claim

not approved within a reasonable time, and disallowed by the State

Commission but subsequently allowed by the Superior authority. Revenue

gap as a result of allowance of legitimate expenditure in the true up.

11.6. The State Commission shall decide the claim of the appellant on the

above principles”

16. The Review Petition is allowed. The State Commission is directed to

pass consequential order…”

4.1.1.2 RInfra-D in this Petition submitted cumulative Regulatory Asset including carrying

cost till FY 2011-12 as Rs. 3674.72 Crore.

4.1.1.3 RInfra-D further submitted that the Hon’ble ATE clarified that all legitimate

expenditure, whether identified during truing-up process or allowed subsequently to

the licensee by any higher authority or on account of deferment of recovery by the

State Commission itself, should be eligible for carrying cost.


Page 162 of 302

4.1.1.4 RInfra-D submitted that the cumulative revenue gap till FY 2011-12 including

carrying cost, by considering the respective year State Bank Advance Rate (SBAR)

as the cost of debt and the rate of return on equity capital as prevailing for the period

from FY 2006-07 to FY 2011-12, i.e., 16% for both Distribution Wires as well as

Retail Supply business as per the Maharashtra Electricity Regulation Commission

(Terms & Conditions of Tariff) Regulations, 2005.

4.1.1.5 RInfra-D further submitted that since FY 2012-13 is over and the new MYT tariff

would be applicable from FY 2013-14 onwards, FY 2013-14 would be the year

when the recovery of Regulatory assets would commence and carrying cost needs to

be worked out on different elements of Revenue Gap from the year of accrual of

such gap up to the middle of FY 2013-14.

4.1.1.6 RInfra-D submitted cumulative Revenue Gap with Carrying Cost accrued till FY

2011-12 as given in the table below:

Table 119: Cumulative Revenue Gap with Carrying Cost till FY 2011-12 as submitted by

RInfra-D (Rs. Crore)


2006-07

FY

2007-08

FY

2008-09

FY

2009-10

FY

2010-11

FY

2011-12

1 Revenue gap 23.95 56.93 328.67 1,188.61 551.47 511.64

Debt portion 70% 70% 70% 70% 70% 70%

Equity Portion 30% 30% 30% 30% 30% 30%

2

Revenue Gap for FY 08-09 as

per order of MERC in Case No.

121 of 2008

680.11

Debt portion

476.08

Equity Portion

204.03

Carrying cost for Debt portion

Interest rate for respective

years 10.75% 11.50% 12.75% 13.00% 11.75% 14.75%

Opening Balance - 17.67 61.84 314.46 1,302.15 1,863.86

Additions for the year 16.77 39.85 230.07 832.03 386.03 358.15

Interest 0.90 4.32 22.55 155.66 175.68 301.33

Closing Balance 17.67 61.84 314.46 1,302.15 1,863.86 2,523.34

Carrying cost for Equity

portion

ROE (%) for respective years 16% 16% 16% 16% 16% 16%

Opening Balance - 7.76 27.45 138.33 578.21 849.41

Additions for the year 7.19 17.08 98.60 356.58 165.44 153.49


Page 163 of 302


2006-07

FY

2007-08

FY

2008-09

FY

2009-10

FY

2010-11

FY

2011-12

Interest 0.57 2.61 12.28 83.30 105.75 148.18

Closing Balance 7.76 27.45 138.33 578.21 849.41 1,151.08

Total Revenue

Gap/Regulatory asset with

Carrying Cost

25.43 89.29 452.79 1,880.36 2,713.26 3,674.42

4.1.1.7 RInfra-D vide its letter reference no RInfra-D/ MERC/ MYT FY 13-16/ 025 dated

23 May 2013, submitted that Hon’ble APTEL in its Judgment dated 20 May 2013 in

Appeal No 85 of 2012 held that

“The third issue regarding non-consideration of assessed sale for the FY 2009-10

and 2010-11 is decided in favour of the Appellant. The State Commission shall

consider the assessed energy from unauthorized uses of electricity which has been

detected by the vigilance action as sale of electricity in computing the Distribution

Loss.”

4.1.1.8 RInfra-D further in the above mentioned letter estimated the total additional amount

to be allowed as Rs 11.23 Crore.

4.2 Commission’s Rulings

4.2.1.1 The Commission in its Order dated 4 April 2013 in Case 124 of 2012, has approved

total Regulatory Asset till FY 2011-12 as Rs 2451.95 Crore and same has been

considered for the purpose of this Petition by the Commission.

4.2.1.2 In accordance with Hon’ble APTEL Judgment dated 20 May 2013 in Appeal no. 85

of 2012, regarding issue of allowance of efficiency gains on assessed sales also, the

Commission has allowed additional sharing of efficiency gains of Rs 11.23 Crore.

4.2.1.3 The Commission has not considered the proposal of RInfra-D for allowance of

additional Return on Equity equivalent 16% return on 30% of the Regulatory Asset,

as there is no provision in MERC Tariff Regulations, 2005 and MERC MYT

Regulations, 2011 to allow such additional ROE. Hence, the Commission has

allowed interest rate for computation of carrying cost equivalent to the interest rate

allowed by the Commission for calculation of interest on working capital

requirement in respective years in the Orders of the Commission. The cumulative


Page 164 of 302

Regulatory Asset after including carrying cost approved by the Commission till FY

2011-12 is as under:

Table 120: Cumulative Regulatory Asset with Carrying Cost till FY 2011-12 as approved

by the Commission (Rs. Crore)

Particulars FY

06-07

FY

07-08

FY

08-09

FY

09-10

FY

10-11

FY

11-12

Revenue gap 23.95 39.32 328.67 1,187.71 529.13 354.40

Debt portion 100% 100% 100% 100% 100% 100%

Revenue Gap for FY 08-09 as per

order of MERC in Case No. 121 of

2008*

680.11

Debt portion 680.11

Carrying cost for Debt portion

Interest rate for respective years 10.75% 11.50% 12.75% 13.00% 11.75% 14.75%

Opening Balance - 25.24 69.72 428.23 1,835.53 2,611.42

Additions for the year 23.95 39.32 328.67 1,187.71 529.13 354.40

Carrying Cost 1.29 5.16 29.84 219.59 246.76 411.32

Closing Balance 25.24 69.72 428.23 1,835.53 2,611.42 3377.14

Total Regulatory asset with

Carrying Cost 25.24 69.72 428.23 1,835.53 2,611.42 3377.14

4.3 Regulatory Asset Recovery Mechanism

4.3.1 Proposed Recovery Mechanism

4.3.1.1 RInfra-D submitted that in Order in Case No. 72 of 2010 dated 29 July, 2011, the

Commission classified consumers into three groups for the purpose of determining

the recovery of cumulative revenue gap/regulatory assets, due to the phenomenon of

migration/changeover occurring as an outcome of the Supreme Court ruling

allowing TPC-D to supply power in the common area of supply between RInfra-D

and TPC-D and also the ruling of the Commission in the Order in Case No. 50 of

2009, detailing the operating procedures to be followed in case of changeover.

RInfra- D proposed to apportion the Cumulative Regulatory Asset of Rs 3674.42

Crore till FY 2011- 12, between RInfra-D Own consumer and Changeover

consumers based on ratio of Own sales and Changeover sales of RInfra-D for FY

2011-12, as given in the table below:

Table 121: Bifurcation of Regulatory Asset to Own and Changeover consumers as



Page 165 of 302

Particulars Amount

(in Rs. Cr)

Opening Balance of recovery in FY13 3,674.42

FY 2011-12 Own Sales 6,386.93

FY 2011-12 Change Over Sales 2,663.39

Revenue Gap (RInfra-D Own consumers) 2,593.09

Revenue Gap (RInfra-D Changeover consumers) 1,081.33

4.3.1.2 RInfra-D proposed the recovery of the Revenue Gap over the period FY 2012-13 to

FY 2018-19, i.e., over a period of six years from FY 2013-14 so as to prevent tariff

shock to the consumers. RInfra-D submitted that since, the recovery was spread

over 6 years; there will be further accumulation of interest (carrying cost) on the

outstanding average balance of each year.

4.3.1.3 RInfra-D has estimated the carrying cost from FY 2012-13 onwards considering

70:30 debt: equity and weighted average cost of capital as 14.80% based on the rate

of raising debt of 14.5% based on SBI Advance Rate (SBAR) and rate of return on

equity invested as 15.5%. RInfra-D proposed that Regulatory Assets are recovered

as a separate line item and not merged with retail tariff. The recovery towards

Regulatory Assets including Carrying Cost for its Own Consumers as submitted by

RInfra-D is given in the table below:

Table 122: Regulatory Asset Recovery for Own Consumers as submitted by RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

FY

2016-17

FY

2017-18

FY

2018-

19

Carrying Cost rate 14.80% 14.80% 14.80% 14.80% 14.80% 14.80% 14.80%

Opening Balance (Rs.

Crore) 2,593.09 2,976.86 2,480.72 1,984.58 1,488.43 992.29 496.14

Recovery from

opening balance (Rs.

Crore)

- 496.14 496.14 496.14 496.14 496.14 496.14

Closing Balance (Rs.

Crore) 2,593.09 2,480.72 1,984.58 1,488.43 992.29 496.14 -

Carrying cost for the

year (Rs. Crore) 383.78 403.86 330.43 257.00 183.57 110.14 36.71

Total Recovery (Rs.

Crore) 383.78 900.01 826.58 753.15 679.72 606.29 532.86

Smoothened

recovery 0.00 716.43 716.43 716.43 716.43 716.43 716.43


Page 166 of 302

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

FY

2016-17

FY

2017-18

FY

2018-

19

(Rs. Crore)

RInfra-D Own sales

(MU) 6,346.36 6,593.68 6,790.34 7,020.09

Avg. per unit

Recovery (Rs. / kWh) 1.09 1.06 1.02

4.3.1.4 RInfra-D further submitted that for the estimation of sales from Changeover

consumers it considered that a large group of consumers would convert to Group III

(i.e. switchover to the other distribution licensee’s network) due to effect of Order

in Case No. 151 of 2011.

4.3.1.5 RInfra-D also submitted that Regulatory Asset Charge cannot be fixed assuming

such a large scale conversion to Group III, when the same has not yet happened and

if the same conversion to Group III is assumed, the sales from Changeover

consumers would significantly decline and the per-unit Regulatory Asset Charge

would substantially increase.

4.3.1.6 RInfra-D further submitted that since the Regulatory Asset Charges would be

published and come into effect immediately upon issue of MYT Order, RInfra-D

would start charging the same to change-over consumers, even though actual

Switchover may not have happened till then. RInfra-D has submitted that all sales –

Own or Migrated were considered for ex-ante determination of Regulatory Asset

Charge by RInfra-D. The recovery towards Regulatory Assets for Changeover

consumers as submitted by RInfra-D is given in the table below:

Table 123: Determination of Regulatory Asset Charge for Changeover submitted by

RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

FY

2016-17

FY

2017-18

FY

2018-19


Opening Balance (Rs.

Crore) 1,081.33 1,241.37 1,034.48 827.58 620.69 413.79 206.90

Recovery from opening

balance (Rs. Crore) - 206.90 206.90 206.90 206.90 206.90 206.90

Closing Balance (Rs. 1,081.33 1,034.48 827.58 620.69 413.79 206.90 -


Page 167 of 302

Crore)


year (Rs. Crore) 160.04 168.41 137.79 107.17 76.55 45.93 15.31

Total Recovery (Rs.

Crore) 160.04 375.31 344.69 314.07 283.45 252.83 222.21

Smoothened recovery

(Rs. Crore) 0.00 298.76 298.76 298.76 298.76 298.76 298.76

Total Migration Sales

(MU) including

Switchover Sales

3,076.30 3,236.05 3,409.16 3,587.91

Avg. per unit

Recovery (Rs. / kWh) 0.92 0.88 0.83

4.3.1.7 RInfra-D further submitted that the actual charge applicable to a consumer category

would be dependent on the “K” factor, which was determined by dividing the

consumer category’s approved ABR by the overall ACoS of RInfra-D for any given

year.

4.3.1.8 RInfra-D proposed that during the recovery period if any consumer terminates its

contract with RInfra-D, the outstanding un-recovered regulatory asset amount from

such consumer shall be recovered in the following manner:

Balance Recovery = ΣA * Bi * Ci (in Rs)

A - Avg. monthly consumption for last 12 months (or available period if

less than 12 months) (in units)

Bi - Balance recovery period (in months) for year ‘i’

Ci - Charge specified for relevant category (in Rs/unit) for year ‘i’

4.3.1.9 RInfra-D proposed that

a) The outstanding Regulatory Asset liability would be adjusted with the Consumer

Security Deposit maintained by consumer with RInfra-D as on date of termination of

the contract. After adjustment of the same, the balance outstanding liability could be

cleared by the outgoing consumer in one goes as indicated in the formula above. In

such case, the Charge specified “Ci” would be discounted for the future carrying cost

included in the said charge.


Page 168 of 302

b) If the consumer, however, opts for monthly payment of Regulatory Asset charge, the

recovery would continue in the normal manner at the specified charge multiplied by

month’s consumption of such consumer. RInfra-D further proposed that the collection

of charges levied on Changeover and Switchover consumers (who opt for future

monthly payments) and the remittance of the same to RInfra-D would be the

responsibility of the licensee supplying power to such consumer. RInfra-D also

proposed that a separate Regulatory Asset recovery account would be maintained

which shall maintain opening balance of Regulatory Asset plus interest, amount set

off (recovered) during the year and the closing balances each year. If, however, for

any reason, the amount remains un-recovered, the same shall remain identified with

the premises for the purpose of recovery.

4.3.1.10 RInfra-D further submitted that any under-recovery or over-recovery each year,

within the six-year period of recovery proposed, was to remain within the

Regulatory Asset basket only and not passed on to the retail ARR. At the end of the

six-year recovery period, however, if there remained any over or under-recovery

vis-à-vis the approved Regulatory Assets, the same would be absorbed within

RInfra-D’s ARR.


4.3.2.1 The Commission is the opinion that the Regulatory Asset needs to be collected from

the consumers connected to the RInfra-D network, i.e., retail supply consumers and

Changeover consumers.

4.3.2.2 The Commission in its Order in Case 72 of 2010 has ruled that Regulatory Asset

can be recovered from Group I and Group II consumers. The relevant extracts of the

Commission’s ruling in Case No. 72 of 2010 is as given below:

“h) Given this background, the applicability of the charges to recover the

regulatory assets for the above Groups and the rationale for the same are

discussed below:


Page 169 of 302

i) Group I: will have to pay the charges for recovery of regulatory assets,

since they continue to be consumers of RInfra-D, both for Wires as well as

Supply.

ii) Group II: will have to pay the charges for recovery of regulatory

assets, since they continue to be consumers of RInfra-D for Wires

iii) Group III: will not have to pay the charges for recovery of regulatory

assets, since they are no longer consumers of RInfra-D, either for Wires or

Supply, and charges can be levied by a licensee only on a 'consumer'.

Accordingly, RInfra-D should propose recovery of the regulatory asset

from Group I and Group II consumers, in the subsequent years.”

4.3.2.3 Hence, the Commission has approved recovery of Regulatory Asset Charge from

Group I and Group II consumer, which are connected to the RInfra-D network and

sourcing power either from RInfra-D or TPC-D.

4.3.2.4 The Commission notes that RInfra-D has not submitted any rationale for

apportionment of the cumulative revenue gap between RInfra-D own consumers and

changeover consumers based on ratio of sales from RInfra-D and changeover

consumers of FY 2011-12. Also, the Regulatory Asset Liability needs to be shared

equally by all the consumers of RInfra-D network (Changeover and Direct

consumers). Hence, the Commission is also of the opinion that Regulatory Asset

needs to be borne equally by Direct Consumers and Changeover consumers.

4.3.2.5 The Commission has accepted the interest rate of 14.5% as cost of debt as submitted

RInfra-D for the purpose of calculating the carrying cost for the second Control

Period. However, the Commission has considered the Regulatory Asset would be

funded entirely by debt component, as explained earlier in this section.

4.3.2.6 The Commission has approved Regulatory Asset Charge to be recovered from

Retail consumer and Changeover consumers of RInfra-D as under:

Table 124: Regulatory Asset Charge approved by the Commission (Rs Crore)

Particulars FY 12-

13 FY 13-14 FY 14-15

FY 15-

16 FY 16-17 FY 17-18 FY 18-19


Opening Balance 3,377.14 3,866.83 3,222.35 2,577.88 1,933.41 1,288.94 644.47

Recovery from

opening balance - 644.47 644.47 644.47 644.47 644.47 644.47


Page 170 of 302

Closing Balance 3,377.14 3,222.35 2,577.88 1,933.41 1,288.94 644.47 -


year 489.69 513.97 420.52 327.07 233.62 140.17 46.72

Total Recovery 489.69 1,158.44 1,064.99 971.54 878.09 784.64 691.20

Smoothened recovery 924.82 924.82 924.82 924.82 924.82 924.82

RInfra-D Own sales

and Changeover Sales 10,141 10,664 11,229

Recovery charge per

unit 0.91 0.87 0.82

4.3.2.7 The Commission is also of the opinion that Regulatory Asset Charge shall be

recovered from the consumers on a proportionate basis, which is as under:

Table 125: Regulatory Asset Charge approved by the Commission (Rs/kWh)


15

FY

15-16

LT


LT -I Residential

0-100 0.48 0.52 0.56

101-300 0.84 0.74 0.75

301-500 1.12 0.86 0.89

501 and above 1.47 1.17 1.07

LT II (a) - 0-20 kW 1.05 1.03 0.84

LT II (b) -> 20 to 50 kW 1.40 1.31 1.01

LT II (c) - above 50 kW 1.46 1.39 1.22





LT-VII (A): LT -Temporary Supply Religious 0.84 0.85 0.84


LT VIII: LT - Crematorium & Burial Grounds 0.64 0.77 0.86


LT X- Public Services 1.09 1.04 0.92

HT

HT I: HT-Industry 1.12 1.00 1.05





Page 171 of 302


15

FY

15-16

HT - Railway 1.19 1.12 1.01

HT – Public Services 1.19 1.12 1.01

4.3.2.8 The Commission has approved RAC as a separate charge, as this liability pertaining

to the past period needs to be borne by consumers who are connected to the RInfra-

D distribution network, i.e., the direct retail sale consumers and changeover

consumers. For levying the RAC to the changeover consumers, it should be a

separate charge and not merged with the retail tariff.

4.3.2.9 The Commission is also the opinion that RAC as a separate line item in Tariff is

also required to enable RInfra-D to maintain a separate regulatory asset recovery

account and RInfra-D shall maintain the opening balance of Regulatory Asset

allowed including carrying cost for a year, Recovered Regulatory Asset and closing

balance of Regulatory Asset for a year. Hence, the Commission has approved RAC

as a separate charge and directs RInfra-D to maintain a separate account for

Regulatory Asset Charge recovery.

4.3.2.10 As regards to creation of a liability on a consumer, if consumers decides to

terminate its contract, the Commission is also of the opinion that a distribution

licensee should be considered to be operating on a ‘Going concern basis’, which is

one of the fundamental assumptions in accounting on the basis of which financial

statements are prepared. The Commission also notes that there would be new

consumers being added to the consumers who will also be paying Regulatory Asset

Charge. Hence, the consumers will be paying Regulatory Asset Charge till they are

connected to the RInfra-D distribution network as Direct or Changeover consumers

and the day consumer terminates its contract, the recovery of RAC from such

consumers shall stop. Further, the Regulatory Asset Charge approved by the

Commission shall be levied on energy consumption of the direct consumers and

changeover consumers connected to the RInfra-D network on a monthly basis and

not after termination of contract with RInfra-D.

4.3.2.11 As regards to the proposal of RInfra-D that outstanding Regulatory Asset liability

would be adjusted with the Consumer Security Deposit maintained by consumer


Page 172 of 302

with RInfra-D as on date of termination of the contract, the Commission has

clarified that the Regulatory Asset charge cannot be recovered after termination of

contract with RInfra-D, hence cumulative Regulatory Liability on such consumers

shall not be applicable.


Page 173 of 302

5. TARIFF PHILOSOPHY

5.1 Wheeling Charges and Wheeling Losses

5.1.1 RInfra-D submission on Wheeling Charges

5.1.1.1 RInfra-D submitted that the Commission vide its Order in Case No. 121 of 2008

dated 22 July 2009 has last determined the wheeling charges to be paid by

consumers who are connected to the RInfra-D’s network, which are as under:

Table 126: Existing Wheeling Charges as submitted by RInfra-D

Particulars HT LT

Wheeling Charges (Rs per kWh) 0.46 0.88

5.1.1.2 RInfra-D further submitted that for the purpose of estimation of income from

wheeling charges, it has not considered any revision in wheeling charges for FY

2012-13. For the remaining years of the second Control Period, i.e., from FY 2013-

14 to FY 2015-16, RInfra-D has proposed to recover its Wires revenue requirement

from consumer connected to the RInfra-D network including RInfra-D Own

consumers and Changeover consumers through wheeling charges.

5.1.1.3 RInfra-D has proposed that the recovery would be in the proportion of energy sales

for the respective years as projected in the MYT Petition. The Wheeling Charges for

the Second Control Period from FY 2012-13 to FY 2015-16 as submitted by RInfra-

D is as given in the table below:

Table 127: Wheeling Charges as proposed by RInfra-D for the remaining part of Second

Control Period

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Determination of Wheeling Charges

Revenue Requirement from Wire Business

(Rs Crore) 1,190.12 1,225.93 1,324.14 1,436.07

Total Sales (Own + Migration) (MU) 9,422.66 8,160.17 7,316.40 7,568.84

Wheeling Charges per unit (Rs/kWh) 1.26 1.50 1.81 1.90

Distribution of Charges between HT and LT

Network

GFA attributable to HT network (Rs Crore) 55% 55% 55% 55%

GFA attributable to LT network (Rs Crore) 45% 45% 45% 45%

Charge recoverable for HT Network (Rs Crore) 654.57 674.26 728.27 789.84

Charge recoverable for LT Network(Rs Crore) 535.55 551.67 595.86 646.23


Page 174 of 302

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16


consumers

HT Sales (MU) 1,125.66 842.84 645.68 739.60

LT Sales (MU) 8,297.00 7,317.33 6,670.72 6,829.24

Charge recoverable for HT consumers (Rs

Crore) 78.20 69.64 64.27 77.18

Charge recoverable for LT consumers (Rs

Crore) 1,111.92 1,156.29 1,259.86 1,358.89

Wheeling Charges applicable/proposed

HT Category (Rs/kWh) 0.46 0.83 1.00 1.04

LT Category (Rs/kWh) 0.88 1.58 1.89 1.99

5.1.1.4 RInfra-D has submitted the wheeling losses of 1.94% for HT Category and 9% for

LT Category.


5.1.2.1 The Commission has accepted the methodology suggested by RInfra-D and

approved wheeling charges are as under

Table 128: Wheeling Charges approved by the Commission for second Control Period (Rs

Crore)


Existing Revised Revised Revised

Revenue Requirement from Wire Business

1,152.53

1,164.29

1,240.13

1,325.90

Total Sales (Own + Migration) (MU) 10,140.74 10,664.29 11,228.53


Network

GFA attributable to HT network

55% 55% 55%

GFA attributable to LT network

45% 45% 45%

Charge recoverable for HT Network (Rs

Crore)

640.36

682.07

729.24

Charge recoverable for LT Network(Rs

Crore)

523.93

558.06

596.65


consumers


Page 175 of 302


HT Sales (MU) 1,125.66 1,312 1,429 1,576

LT Sales (MU) 8,297.00 8,829 9,236 9,653

Charge recoverable for HT Network (Rs

Crore)

82.84

91.38

102.33

Charge recoverable for LT Network(Rs

Crore)

1,081.45

1,148.76

1,223.57

Wheeling Charges

HT (Rs/ kWh) 0.46 0.63 0.64 0.65

LT (Rs/ kWh) 0.88 1.22 1.24 1.27

Revenue From Wheeling Charges of

Changeover Consumers

HT Sales (MU) 879 930 984 1041

LT Sales (MU) 2449 2617 2890 3168

Charge Recovered from HT Consumers

40.44

58.59

62.96

67.65

Charge Recovered from LT consumers

215.51

319.29

358.39

402.30

Total Revenue from Wheeling Charge

Recovered (Rs Crore) from Changeover

Consumers

255.95

377.88

421.35

469.95

5.1.2.2 The Commission has approved the wheeling loss of 1.94% for HT Category and 9%

for LT Category.

5.1.2.3 Further, the Commission rules that the applicable wheeling charges will be shown

separately in the bills of all consumers, irrespective of whether they are own

consumers or changeover consumers, so that the consumers are made aware of the

tariffs payable for creation of the distribution infrastructure.

5.2 Cross Subsidy Surcharge


5.2.1.1 RInfra-D submitted the following formula for estimation of Cross Subsidy

Surcharge with detailed explanations in its MYT Petition as given below:

CSS = T – [C / (1-L %) + D]

Where,

CSS is the cross subsidy surcharge for the relevant year


Page 176 of 302

T is the Tariff payable by the relevant category of consumers for the

relevant year;

C is the Weighted average cost of power purchase of top 5% at the margin

excluding liquid fuel based generation and renewable power for the

relevant year

D is the Wheeling charge applicable for the relevant year

L is the system Losses for the applicable voltage level, expressed as a

percentage.

Further, “T” was the proposed Tariff for the respective years from the

period FY 2012-13 to FY 2015-16.

“C” considered for the different years of the MYT Petition is given in the

table below:

Table 129: Marginal Power Purchase Cost per unit for CSS calculations as

submitted by RInfra-D (Rs. /kWh)

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Marginal Power Purchase Cost per unit 4.99 5.13 4.88 5.03

“L” referred to the System Losses for the applicable voltage level,

expressed as a percentage. The system losses were considered in the Cross

Subsidy Surcharge formula were the same as considered in the

determination of Energy Balance in MYT Petition as given in table below:


Page 177 of 302

Table 130: System Losses for CSS calculations as submitted by RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Transmission Losses 4.85% 4.85% 4.85% 4.85%

Distribution Losses : HT network 1.94% 1.94% 1.94% 1.94%

Distribution Losses : LT network 9.00% 9.00% 9.00% 9.00%

D” referred to the Wheeling Charges for usage of RInfra-D network. For

FY 2012-13, it was retained at the present level, while from FY 2013-14,

the proposed wheeling charges were considered as given in the table

below:

Table 131: Wheeling Charges for CSS calculations as submitted by RInfra-D

Particulars FY

2012-13

FY

2013-14

FY

2014-15

FY

2015-16

Wheeling Charges per unit – HT 0.46 0.83 1.00 1.04

Wheeling Charges per unit – LT 0.88 1.58 1.89 1.99

5.2.1.2 RInfra-D submitted that for FY 2012-13, the Cross Subsidy Surcharge recovery per

unit (Rs. / kWh) were retained as applicable at present, based on the Order in Case

No. 43 of 2010 dated 9 September, 2011. From FY 2013-14 to FY 2015-16, the

Cross Subsidy Surcharge per unit (Rs. / kWh) proposed for each year to be

recovered from the Changeover Consumers as given in the table below:

Table 132: CSS (Rs. /kWh) for the Second Control Period as submitted by RInfra-D

Particulars Existing

FY 2012-13

FY

2013-14

FY

2014-15

FY

2015-16

LT

LT I - Below Poverty Line - - - -


0-100 - - - -

101-300 - - - -

301-500 - 3.54 2.24 1.96

501 and above 0.03 5.23 3.97 3.69



Page 178 of 302

Particulars Existing

FY 2012-13

FY

2013-14

FY

2014-15

FY

2015-16

0-100 - - - -

101-300 - - - -

301-500 - 3.53 2.23 1.95

501 and above - 5.00 3.74 3.47

LT II (a) - 0-20 kW - 2.51 1.97 1.97

LT II (b) - >20 to 50 kW 0.84 4.44 2.74 2.45

LT II (c) - above 50 kW 1.90 5.04 3.15 2.85

LT III - LT Industrial upto 20 kW - 1.76 0.83 0.55

LT IV - LT Industrial above 20 kW - 1.80 0.90 0.61

LT-V : LT- Advertisements and

Hoardings 8.35 13.17 12.07 12.30

LT VI: LT -Street Lights - 2.77 2.20 2.17

LT-VII (A): LT -Temporary

Supply Religious - 0.54 - -

LT-VII (B): LT -Temporary

Supply Others 5.51 11.09 9.88 9.96

LT VIII: LT - Crematorium &

Burial Grounds - - - -

LT IX: LT -Agriculture - - - -

HT

HT I: HT-Industry - 1.96 1.44 1.30


HT III: HT-Group Housing Society - 0.39 0.32 0.52


HT – Railway - - - -


5.2.2.1 As per Section 61 of the Act, tariff should progressively reflect the cost of supply

and reduce cross subsidies in the manner specified by the Commission.

5.2.2.2 Also, second proviso to Section 42 (2) stipulates as under:

“Provided further that such surcharge shall be utilised to meet the requirements of

current level of cross subsidy within area of supply of the distribution licensee”

Emphasis added


Page 179 of 302

5.2.2.3 It is clear from the above extracts the CSS needs to be determined for meeting

“current” level of cross subsidy of a distribution licensee.

5.2.2.4 Further, Regulation 13.8 of MERC (Distribution Open Access) Regulations, 2005 is

reproduced below:-

“13.8 The Commission shall, based on the approved current level of cross subsidy,

stipulate the cross subsidy surcharge for each approved Tariff category and/or sub-

category and/or Tariff slab, of the Distribution Licensee.” Emphasis added

5.2.2.5 Hence, the above mentioned extracts also emphasise on the current level of cross

subsidy as a basis of determination of CSS.

5.2.2.6 In light of the above stated Regulation, the Commission has proceeded with the

computation of CSS for RInfra-D based on the approved cost and tariffs determined

in this Order, for respective years of the second Control Period.

5.2.2.7 With regards to the objections raised by consumers and other stakeholders in the

Public consultation process, on the proposal of RInfra-D to increase the CSS, the

Commission is of the view the CSS needs to reflect the current level of cost and

tariff and formulae to be adopted should be the formulae as provided in the Tariff

Philosophy. Since, there is change in marginal cost of power and the Average

Billing Rate of RInfra-D, the same needs to be considered for the CSS computation.

5.2.2.8 The Commission observed that there is a variance in formulae is in respect of

grossing up of the component “C”, wherein, RInfra-D has adopted C /(1-L/100)

instead of C *(1+L/100) specified in the formulae of CSS in Tariff Policy. The

Commission has computed the CSS as per formulae provided in the Tariff Policy.

5.2.2.9 The Commission opines that the CSS computation needs to be undertaken only as

per the approved values of various components of CSS formulae, which are as

under:

Computation of ‘C’

5.2.2.10 Computation of ‘C’ for RInfra-D for the period from FY 2013-14 to FY 2015-16 is

based on the power purchase quantum and power purchase rate approved in this

Order for purchase from different sources, as elaborated in Section 3 of this Order

and is given in the table below:-


Page 180 of 302

Table 133: Marginal Cost of Power Purchase by RInfra-D approved by the

Commission (Rs/kWh)

Particulars FY

2013-14

FY

2014-15

FY

2015-16

Marginal Power Purchase Cost per unit 5.13 3.75 3.75

Average Billing Rate (ABR)

5.2.2.11 The category-wise ABR for the period from FY 2013-14 to FY 2015-16 have been

considered as approved by the Commission for the retail consumers of RInfra-D and

as elaborated later in this section.

System Loss ‘L’

5.2.2.12 The system loss for RInfra-D comprises the Wheeling Loss and Transmission Loss

approved by the Commission while approving the Energy Balance for RInfra-D for

the period from FY 2013-14 to FY 2015-16, as elaborated in Section 3 of this Order.

5.2.2.13 The computation of System Loss ‘L’ for the period from FY 2013-14 to FY 2015-16

is given in the Table below:

Table 134: System Losses for CSS calculations approved by the Commission

(%)

Particulars FY

2013-14

FY

2014-15

FY

2015-16

Intra-State Transmission Losses 4.85% 4.85% 4.85%

Distribution Losses : HT network 1.94% 1.94% 1.94%

Distribution Losses : LT network 9.00% 9.00% 9.00%

Wheeling Charges ‘D’


Page 181 of 302

5.2.2.14 “D” referred to the Wheeling Charges for usage of RInfra-D network. For FY 2012-

13, it is retained at the present level, while from FY 2013-14 to FY 2015-16, the

proposed wheeling charges were considered as given in the table below:

Table 135: Wheeling Charges for CSS calculations as approved by the

Commission (Rs/kWh)

Particulars FY

2013-14

FY

2014-15

FY

2015-16

Wheeling Charges per unit – HT 0.63 0.64 0.65

Wheeling Charges per unit – LT 1.23 1.24 1.27

Approved Category wise Cross Subsidy Surcharge (CSS)

5.2.2.15 For FY 2012-13, the Cross Subsidy Surcharge recoveries per unit (Rs. / kWh) were

calculated as per applicable rates in FY 2012-13, based on the Order in Case No. 43

of 2010 dated 9 September, 2011. From FY 2013-14 to FY 2015-16, the Cross

Subsidy Surcharge per unit (Rs. / kWh) approved for each year to be recovered from

the Changeover Consumers as given in the table below:

Table 136: Approved CSS for FY 2013-14(Rs/kWh)

Particulars

T C C*(1+L%) W CSS

Rs/kWh Rs/kWh Rs/kWh Rs/kWh Rs/kWh

LT Category

LT I - Below Poverty Line

2.16

5.13

5.86

1.23

-

LT -I Residential

-

0-100

3.65

5.13

5.86

1.23

-

101-300

6.82

5.13

5.86

1.23

-

301-500

8.54

5.13

5.86

1.22

1.46

501 and above

10.84

5.13

5.86

1.22

3.76

LT II (a) - 0-20 kW

8.39

5.13

5.86

1.22

1.30

LT II (b) - >20 to 50 kW

10.97

5.13

5.86

1.22

3.89

LT II (c) - above 50 kW


Page 182 of 302

Particulars

T C C*(1+L%) W CSS


11.35 5.13 5.86 1.22 4.27

LT III - LT Industrial upto 20

kW

8.33

5.13

5.86

1.22

1.25

LT IV - LT Industrial above

20 kW

8.46

5.13

5.86

1.22

1.38

LT-V : LT- Advertisements

and Hoardings

18.64

5.13

5.86

1.22

11.55

LT VI: LT -Street Lights

9.22

5.13

5.86

1.22

2.14


Supply Religious

8.49

5.13

5.86

1.22

1.41


Supply Others

17.10

5.13

5.86

1.22

10.01


Burial Grounds

4.64

5.13

5.86

1.23

-

LT IX: LT -Agriculture

1.86

5.13

5.86

1.23

-

HT Category

HT I: HT-Industry

8.66

5.13

5.48

0.63

2.55

HTII : HT- Commercial

9.80

5.13

5.48

0.63

3.69

HT III: HT-Group Housing

Society

6.45

5.13

5.48

0.63

0.33

HTIV : HT - Temporary

Supply

12.75

5.13

5.48

0.63

6.64

HT - Railway (New Category)

9.09

5.13

5.48

0.63

2.98

Note: a) CSS for LT- X public services shall be equivalent to CSS determined for LT-II-A

Non-domestic or Commercial (0-20 kW)

b) CSS for HT-VI public services shall be equivalent to CSS determined for HT-V

Railways (0-20 kW)

Table 137: Approved CSS for FY 2014-15(Rs/kWh)

Particulars T C C*(1+L%) W CSS


LT Category

LT I - Below Poverty Line 2.26 3.75 4.29 1.24 -

LT -I Residential

0-100

3.54

3.75

4.29

1.24

-

101-300


Page 183 of 302



5.62 3.75 4.29 1.24 0.09

301-500

6.13

3.75

4.29

1.24

0.60

501 and above

7.93

3.75

4.29

1.24

2.40

LT II (a) - 0-20 kW

7.55

3.75

4.29

1.24

2.02

LT II (b) - >20 to 50 kW

9.45

3.75

4.29

1.24

3.92


9.87

3.75

4.29

1.24

4.34


kW

7.07

3.75

4.29

1.24

1.54

LT IV - LT Industrial above 20

kW

7.19

3.75

4.29

1.24

1.66


Hoardings

16.60

3.75

4.29

1.24

11.07


7.71

3.75

4.29

1.24

2.18


Supply Religious

7.94

3.75

4.29

1.24

2.41


Supply Others

16.09

3.75

4.29

1.24

10.56


Burial Grounds

5.05

3.75

4.29

1.24

-


1.85

3.75

4.29

1.24

-

HT Category

-

HT I: HT-Industry

7.15

3.75

4.01

0.64

2.49


8.69

3.75

4.01

0.64

4.04


Society

6.34

3.75

4.01

0.64

1.68

HTIV : HT - Temporary Supply

11.00

3.75

4.01

0.64

6.35


7.84

3.75

4.01

0.64

3.19




Railways (0-20 kW)

Table 138: Approved CSS for FY 2015-16 (Rs/kWh)



Page 184 of 302


LT Category


2.37

3.75

4.29

1.27

-

LT -I Residential

-

0-100

3.48

3.75

4.29

1.27

-

101-300

5.29

3.75

4.29

1.27

-

301-500

5.76

3.75

4.29

1.27

0.20

501 and above

6.64

3.75

4.29

1.27

1.08

LT II (a) - 0-20 kW

5.83

3.75

4.29

1.27

0.26

LT II (b) - 20-50 kW

6.92

3.75

4.29

1.27

1.36


8.09

3.75

4.29

1.27

2.53


kW

6.07

3.75

4.29

1.27

0.51


kW

6.17

3.75

4.29

1.27

0.61


Hoardings

14.57

3.75

4.29

1.27

9.01


6.19

3.75

4.29

1.27

0.63


Supply Religious

7.39

3.75

4.29

1.27

1.83


Supply Others

14.09

3.75

4.29

1.27

8.53


Burial Grounds

5.15

3.75

4.29

1.27

-


2.00

3.75

4.29

1.27

-

HT Category

HT I: HT-Industry

6.84

3.75

4.01

0.65

2.18


7.60

3.75

4.01

0.65

2.94


Society

6.23

3.75

4.01

0.65

1.56


9.00

3.75

4.01

0.65

4.34


6.55

3.75

4.01

0.65

1.89




Page 185 of 302


Railways (0-20 kW)

5.3 Revenue Gap and Revenue requirement from retail tariff

5.3.1 Revenue Gap at existing tariff

5.3.1.1 RInfra-D has not proposed any change in tariff for the period FY 12-13. For FY

2012-13, RInfra-D has considered revenue for the period April 2012 to September

2012 as per actuals and the revenue for the period October 2012 to March 2012 has

been estimated based on the existing tariff applicable and revised FAC which is

based on the FAC applicable for the month of October 2012. RInfra-D has proposed

that the revenue gap of FY 12-13 may be recovered from Tariff in the year FY 13-

14. The following table provides the Revenue gap for FY 12-13 as submitted by

RInfra-D:

Table 139: Revenue Gap for FY 2012-13 as submitted by RInfra-D (Rs

Crore)

Particulars FY 13

ARR Retail Business 4117.54

ARR Wires Business 1190.12

Total 5307.66

Less Income from Wheeling Charges 234.67

Less Income from CSS 98.67

ARR (net) 4974.31

Revenue from Sale of Power 4633.53

Revenue Gap/ (Surplus) 340.79


5.3.2.1 The Commission has considered the computed the revised ARR of FY 2012-13, as

discussed in Section 3 of this Order. The Commission has approved the provisional

revenue of Rs 4441.6 Crore for FY 2012-13 and approved the revenue Gap at

existing tariff as under:


Page 186 of 302

Table 140: Revenue Gap for FY 2012-13 approved by the Commission (Rs

Crore)

Particulars FY 13

ARR Retail Business 4099.1

ARR Wires Business 1152.5

Total 5251.6

Less Income from existing Wheeling Charges 256.0

Less Income from existing CSS 98.7

ARR (net) requirement 4897.0

Revenue from Sale of Power at existing tariff 4441.6

Revenue Gap/ (Surplus) 455.4

5.3.3 Revenue requirement to be recovered from Revised Tariffs

5.3.3.1 RInfra-D has submitted that recovery of wheeling charges and cross subsidy

surcharge from changeover consumers shall reduce the net revenue requirement to

be recovered from the Retail Tariff.

5.3.3.2 RInfra-D has considered the existing tariffs as at the end of FY 12-13 after merging

the presently applicable FAC with the energy charges. The same tariff has been

considered by RInfra-D to compute revenue from Existing tariff for FY 2013-14 to

FY 2015-16.

5.3.3.3 RInfra-D has estimated revenue from existing tariffs for the rest of the control

period (from FY 13-14 to FY 15-16) which is as under:

Table 141: Net Revenue Requirement for the second Control Period from

RInfra-D Consumers as submitted by RInfra-D (Rs Crore)

Particulars FY 13 FY 14 FY 15 FY 16

ARR Retail Business 4117.54 4287.19 3936.71 4148.39

ARR Wires Business 1190.12 1225.93 1324.14 1436.07

Total 5307.66 5513.12 5260.85 5584.46

Less Income from Wheeling Charges 234.67 212.94 81.56 89.75

Less Income from CSS 98.67 468.29 115.46 107.29

ARR Revenue Gap of FY 2012-13 340.79

ARR (net) 4974.31 5172.68 5063.83 5387.42

Revenue from Sale of Power 4633.53 5244.68 5444.34 5675.19

Revenue Gap/ (Surplus) 340.79 (72.00) (380.52) (287.78)

Average Cost of Supply (Rs/kWh) 7.84 7.84 7.46 7.67


Page 187 of 302


5.3.4.1 The Commission noted that RInfra-D has computed the revenue from CSS and

wheeling charges based on its revised proposal, while calculating the Revenue at the

existing tariff.

5.3.4.2 The Commission is of the view that for computing revenue for existing retail tariff,

CSS and wheeling charges for FY 2013-14, the existing prevailing applicable rates

at the end of FY 2012-13, shall be considered.

5.3.4.3 For FY 2014-15 and FY 2015-16, the Commission is of the view that for computing

revenue for existing retail tariff, CSS and wheeling charges, the revised tariffs, CSS

and wheeling charges of FY 2013-14 and FY 2014-15, has been considered, which

are approved later in this section.

5.3.4.4 Revenue Gap at existing tariffs for the rest of the Control Period approved by the

Commission is as under:

Table 142: Revenue Gap for the second Control Period at existing tariff approved

by the Commission (Rs Crore)


ARR Retail Business 4099 4125 3859 4074

ARR Wires Business 1152 1164 1240 1326

Total 5251 5289 5099 5400

ARR Revenue Gap of FY 2012-13 455.4

Less Income from existing Wheeling Charges 256.0 273.1 414.6 459.4

Less Income from existing CSS 98.7 113.6 891.7 950.4

ARR (net) 4897.0 5357.9 3793.0 3990.5

Revenue from Sale of Power at existing tariff 4441.6 5253.5 4831.0 4365.8

Revenue Gap/ (Surplus) 455.4 104.39 (1038.01) (375.30)

Average Cost of Supply (Rs/kWh) 7.91 8.13 5.59 5.68

5.3.4.5 The Commission further observes that for CSS, wheeling charges and retail tariff

are inter-related. Also, revenue from revised CSS and wheeling charges would have

to be factored in to ascertain revenue requirement from the retail tariff.

5.3.4.6 The Commission has computed the revenue from approved revised CSS and

wheeling charges as discussed earlier in this section to ascertain revenue

requirement from retail tariff.


Page 188 of 302

5.3.4.7 The Commission has further normalised adjustment of surplus in order to avoid

tariff shock to the consumers and considered holding cost at interest rate of 14.5%

similar to carrying cost allowed to RInfra-D for recovery of its Regulatory Asset.

5.3.4.8 Net revenue requirement and normalised recovery for the second Control period and

normalised recovery approved by the Commission is as under

Table 143: Net Revenue Requirement and normalised recovery for the second Control

Period at existing tariff approved by the Commission (Rs Crore)




Total 5251 5289 5099 5400

Less Income from Revised Wheeling Charges 256.0 377.9 421.3 469.9

Less Income from Revised CSS 98.7 818.8 895.9 519.0

Regulatory asset recovery

ARR (net) requirement from Retail Tariff 4897.0 4547.9 3782.0 4411.4


Revenue Gap/ (Surplus) 455.4 (705.41) (1050.28) 45.57

Average Tariff Increase /( Decrease) -13% -22% 1.04%

Average Tariff Increase /( Decrease)

(equalised) (570.04) (570.04) (570.04)

Carrying cost (19.63) (69.64)

Normalised Tariff Increase /( Decrease) (589.67) (639.67) (570.04)

Normalised Tariff Increase (%) -11% -13% -13%

Adjusted Revenue Requirement from Retail

Tariff 4663.85 4191.32 3795.79

Adjusted Average Cost of Supply (Rs/kWh) 7.07 6.17 5.41

5.4 Tariff Philosophy

5.4.1.1 RInfra-D has proposed the following principles while making the Tariff proposal for

the second control period as under:

Rationalization of Fixed charges across consumer categories so that progressively a

larger component of fixed cost is recovered through fixed charges


Page 189 of 302

To reduce the cross-subsidy between the consumer categories and rationalising

tariffs in a manner reflecting cost to serve the consumer category.

Staggered change in Tariffs across consumer categories to provide tariff relief to

consumers whose tariffs are presently much higher than cost of supply and are thus

cross subsidising other consumer categories to a large extent.

Achieve a near parity with the tariffs of cross-subsidising consumer categories with

the competing distribution licensee so as to prevent loss of cross-subsidy and

protect interest of low end consumers.

Minimize the impact of tariff on the subsidized consumers in the Residential

category

Propose tariffs to categories which are presently not included in the tariff schedule,

but are likely to come up in MYT period

A. Fixed and Demand Charges

5.4.1.2 RInfra-D submitted that the Tariff currently applicable for RInfra-D consumers was

is as per Order 121 of 2008 dated 15 June, 2009 and there has been no revision in

fixed charges since last the 4 years. RInfra-D requested that since the recovery of

fixed charges/ Demand charges does not vary with consumption, adequate recovery

of fixed/Demand charges is important to any utility since they provide revenue

stability. Further, RInfra-D submitted that majority of the costs of RInfra- D as

provided in the ARR are fixed in nature except for the variable portion of power

purchase cost.

5.4.1.3 Based on above principle, RInfra-D has proposed an increase in fixed charges and

demand charges, which are as under:

Table 144: Fixed Charges as submitted by RInfra-D (Rs/ Consumer/ Month)

Particulars Existing Proposed

LT

LT I - Below Poverty Line 3 5


0-100 30 40


Page 190 of 302


101-300 50 75

301-500 50 75

501 and above 100 150


0-100 100 150

101-300 100 150

301-500 100 150

501and above 100 150

LT II (a) - 0-20 kW 200 205

LT II (b) - >20-50 kW - -

LT II (c) - above 50 kW - -

LT III - LT Industrial upto 20 kW 200 205

LT IV - LT Industrial above 20 kW - -

LT-V : LT- Advertisements and Hoardings 200 205

LT VI: LT -Street Lights - -

LT-VII (A): LT -Temporary Supply Religious 200 205

LT-VII (B): LT -Temporary Supply Others 200 205

LT VIII: LT - Crematorium & Burial Grounds 200 205

LT IX: LT -Agriculture - -

HT

HT I: HT-Industry - -

HTII : HT- Commercial - -

HT III: HT-Group Housing Society - -

HTIV : HT - Temporary Supply 200 280

HT - Railway (New Category) - -

Table 145: Demand Charges as submitted by RInfra-D (Rs/ kVA/ Month)


LT

LT I - Below Poverty Line - -


0-100 - -

101-300 - -

301-500 - -

501 and above - -


Page 191 of 302



0-100 - -

101-300 - -

301-500 - -

501 and above - -

LT II (a) - 0-20 kW - -

LT II (b) - >20-50 kW 150 210

LT II (c) - above 50 kW 150 210

LT III - LT Industrial upto 20 kW - -

LT IV - LT Industrial above 20 kW 150 205

LT-V : LT- Advertisements and Hoardings - -

LT VI: LT -Street Lights 150 205

LT-VII (A): LT -Temporary Supply

Religious - -

LT-VII (B): LT -Temporary Supply Others - -

LT VIII: LT - Crematorium & Burial

Grounds - -

LT IX: LT -Agriculture 15 15

HT

HT I: HT-Industry 150 210

HTII : HT- Commercial 150 210

HT III: HT-Group Housing Society 150 210

HTIV : HT - Temporary Supply - -

HT - Railway (New Category) 150 210

B. Billing demand

5.4.1.4 RInfra-D proposed that billing demand definition for the LT consumer categories

should be similar to the billing demand definition for HT categories and proposed

that the following change in billing demand definition:

“Billing Demand (for LT categories):

Monthly Billing Demand will be the higher of the following:

a) Actual Maximum Demand recorded in the month during 0600 hours to 2200

hours


Page 192 of 302

b) 75% of the highest billing demand recorded during preceding eleven months

subject to limit of contract demand.

c) 50% of the Contract Demand”

Commission’s Ruling

5.4.1.5 The Commission has analysed RInfra-D’s submissions in this context. The

Commission has consciously defined the Billing Demand for such consumers as

under:

“Billing Demand (for LT categories): Monthly Billing Demand will be the higher

of the following:

a) 65% of the actual Maximum Demand recorded in the month during 0600 hours

to 2200 hours.

b) 40% of the Contract Demand.”

5.4.1.6 The rationale behind stipulating the Billing Demand as 65% of the actual Maximum

Demand or 40% of the Contract Demand was that consumers in this category are

smaller consumers and would typically not be able to assess their Demand very

accurately, and should not be subjected to very high demand charges because of

their inability to assess their Contract Demand accurately.

5.4.1.7 Hence, even if the consumer’s actual Maximum Demand is equal to 100% of the

Contract Demand, then such consumer is required to pay Demand Charges

equivalent to 65% of the Contract Demand.


Page 193 of 302

C. Energy Charges

5.4.1.8 RInfra-D proposed following reduction in cross subsidy levels for tariff design:


ACoS

7.84

7.84

7.46

7.67

LT

LT I - Below Poverty Line 13.20% 16.61% 17.25% 17.61%


0-100 46.89% 47.21% 49.52% 51.11%

101-300 91.42% 94.18% 99.22% 99.98%

301-500 143.25% 140.84% 131.09% 127.23%

501 and above 164.80% 162.36% 154.22% 149.66%


0-100 47.90% 49.00% 51.31% 52.76%

101-300 88.00% 89.49% 93.95% 94.50%

301-500 142.96% 140.67% 130.94% 127.10%

501 and above 162.46% 159.35% 151.18% 146.81%

LT II (a) - 0-20 kW 129.33% 127.61% 127.44% 127.27%

LT II (b) - 20-50 kW 164.61% 152.21% 137.78% 133.55%

LT II (c) - above 50 kW 173.65% 159.91% 143.23% 138.76%

LT III - LT Industrial upto 20 kW 120.53% 118.07% 112.06% 108.82%

LT IV - LT Industrial above 20 kW 118.91% 118.62% 113.01% 109.60%


Hoardings 276.83% 263.47% 262.85% 261.87%

LT VI: LT -Street Lights 131.88% 130.90% 130.52% 129.89%


Supply Religious 131.97% 102.51% 100.60% 100.38%


Supply Others 239.72% 236.95% 233.42% 231.49%


Burial Grounds 58.10% 59.19% 62.28% 62.84%

LT IX: LT -Agriculture 12.12% 12.36% 13.01% 13.16%

HT

HT I: HT-Industry 120.65% 105.60% 102.95% 100.78%


Page 194 of 302


HTII : HT- Commercial 134.81% 117.78% 111.81% 108.10%

HT III: HT-Group Housing Society 82.41% 85.63% 87.94% 90.55%

HTIV : HT - Temporary Supply 165.91% 162.60% 162.46% 161.00%

HT - Railway (New Category) 0.00% 71.63% 75.35% 75.95%

5.4.1.9 RInfra-D proposed following energy charges to be recovered from retail consumers:


Existing Proposed Proposed Proposed

LT


0.47

0.47

0.47

0.55


0-100

3.50

3.50

3.50

3.74

101-300

6.57

6.57

6.57

6.83

301-500

10.83

10.51

9.25

9.25

501 and above

12.54

12.23

11.01

11.01


-

0-100

3.50

3.50

3.50

3.74

101-300

6.57

6.57

6.57

6.83

301-500

10.83

10.51

9.25

9.25

501and above

12.54

12.23

11.01

11.01

LT II (a) - 0-20 kW

9.40

9.30

8.81

9.09

LT II (b) - >20-50 kW

12.13

10.92

9.28

9.28


12.89

11.60

9.77

9.77



Page 195 of 302


Existing Proposed Proposed Proposed

kW 9.17 8.99 8.09 8.09


kW

8.76

8.58

7.72

7.72


Hoardings

20.87

19.83

18.78

19.29


9.82

9.53

9.01

9.26


Supply Religious

4.50

5.49

5.00

5.25


Supply Others

18.69

18.49

17.31

17.67


Burial Grounds

4.50

4.59

4.59

4.77


0.95

0.97

0.97

1.01

Total LT

HT

HT I: HT-Industry

8.93

7.59

7.00

7.06


9.94

8.45

7.61

7.61


Society

6.10

6.25

6.10

6.50


13.00

12.75

12.11

12.35

HT - Railway (New Category) 5.00 5 5 5.25

D. Time of Day Tariffs

5.4.1.10 The Time of Day (ToD) tariffs are currently applicable compulsorily to HT I and

HT II categories, LT II (B) and (C) and LT IV category consumers having TOD

meters, as well as optionally available to LT – II (A) and LT III category

consumers, who have TOD meters.

5.4.1.11 The TOD tariffs are available for five time slots, viz., (a) 2200 to 0600 hours, (b)

0600 to 0900 hours, (c) 0900 to 1200 hours, (d) 1200 to 1800 hours, and (e) 1800 to

2200 hours.


Page 196 of 302

5.4.1.12 RInfra-D has proposed increase in the rebate applicable during off peak

consumption (during 2200 Hrs to 0600 Hrs) to encourage shifting of load from peak

to off peak hours.

5.4.1.13 In its Tariff proposal, RInfra-D has proposed an increase the TOD rebate applicable

for all consumer categories for consumption during the off peak hours (2200 – 0600

hrs) to Rs 2.50 per kWh.

E. Creation of new category for Railways

5.4.1.14 RInfra-D had submitted that there are a number of projects being envisaged for

Public Transportation, in furtherance of the existing suburban Rail transport system

such as Metro Rail, Mono Rail and some of which are under construction in RInfra-

D Distribution area and are being provided supply at Temporary Tariff as applicable

for construction. RInfra-D in its MYT Petition for FY 12-13 to FY 15-16 has

proposed creation of new category “Railways” and proposes following tariff to be

charged to this category

Particulars Demand Charges

(Rs /kVA/month)

Energy Charges

(Rs per kWh)

HT Railways: Applicable to electricity

supply at 100 kV/33 kV/ 22 kV/11 kV/6.6

kV to Railways including Metro and

Monorail.

210 5.00

F. Clarification on Distribution Franchising

5.4.1.15 RInfra-D submitted that in Tariff Order dated June 15, 2009, in case 121 of 2008,

the Commission has specified as under –

“The Consumers belonging to HT II requiring a single point supply for the purpose

of downstream consumption by separately identifiable entities will have to either

operate through a franchisee route or such entities will have to take individual

connections under relevant category. These downstream entities will pay

appropriate tariff as applicable as per RInfra Tariff Schedule i.e. LT II.”( Emphasis

added).


Page 197 of 302

5.4.1.16 RInfra-D further submitted that from the above Order, it is clear that if a few

consumers falling under HT II category collectively avail franchise route and

become downstream consumers of a single point franchisee, then the tariff

applicable for such consumers will be LT II.

5.4.1.17 RInfra-D has requested the Commission to clarify on the principles to be adopted

for deciding bulk supply tariff (BST) for the franchise where the mix load exists.

5.4.1.18 The Commission is of the opinion that BST for supply to the Distribution

Franchisee at single point for distribution to mixed loads within the franchised area

will have to reflect its own consumption mix. Also, the Commission cannot

determine BST for all the possible combinations of consumer mix.

5.4.1.19 Hence, it is clarified that in respect of Distribution Franchisees, the licensees are

free to prepare separate terms and conditions for each Franchisee Agreement, on a

case by case basis. It may be noted that in either case, the retail consumers cannot be

charged a tariff higher or lower than that approved by the Commission for the same

category of consumers for that licensee, and also, the responsibility of ensuring

conformance with Standards of Performance, safety and all other relevant

Regulations rests with the respective Licensees.


Page 198 of 302

5.5 Commission’s Tariff Philosophy

5.5.1 Tariff Design

5.5.1.1 In this Order, the Commission has decreased the tariffs in general in order to match

the approved revenue requirement, as detailed earlier in this, while at the same time,

reducing the cross-subsidy prevailing between consumer categories, over the levels

approved by the Commission in the previous Tariff Order. It may be noted that the

tariffs are being revised after more than four years, which has resulted in

accumulated regulatory asset, which have to be amortised along with associated

carrying cost over the MYT Control Period, as discussed in Section 4 of this Order.

5.5.1.2 Normalised recovery of Revenue Requirement as approved earlier in this section is

as under:

Table 146: Net Revenue Requirement and normalised recovery for the second

Control Period at existing tariff approved by the Commission excluding Regulatory

Asset Recovery (Rs Crore)




Total 5251 5289 5099 5400

Less Income from Revised Wheeling Charges 256.0 377.9 421.3 469.9

Less Income from Revised CSS 98.7 818.8 895.9 519.0

Regulatory asset recovery

ARR (net) requirement from Retail Tariff 4897.0 4547.9 3782.0 4411.4


Revenue Gap/ (Surplus) 455.4 (705.41) (1050.28) 45.57

Average Tariff Increase /( Decrease) -13% -22% 1.04%

Average Tariff Increase /( Decrease)

(equalised) (570.04) (570.04) (570.04)

Carrying cost (19.63) (69.64)

Normalised Tariff Increase /( Decrease) (589.67) (639.67) (570.04)

Normalised Tariff Increase (%) -11% -13% -13%

Adjusted Revenue Requirement from Retail

Tariff 4663.85 4191.32 3795.79



Page 199 of 302

5.5.1.3 As observed from the above Table, if each of the years is considered on a stand-

alone basis and tariffs revised in such a manner that the respective revenue

requirement of each year is met, the average normalised tariff decrease required

varies from a 11% to 13%. The Commission has normalised the tariff decrease to

avoid tariff shock in FY 2015-16 after substantial decrease in ARR for FY 2014-15.

Further, under a MYT regime, it would be better to have a smooth tariff trajectory.

Hence, the Commission has adjusted the revenue requirement of each year, by

deferring adjustment of surpluses in future periods, in such a manner that the

average tariff increase for all three years is similar. The Commission has also

allowed commensurate carrying cost, on the amount of revenue surplus deferred to

future periods.

5.5.1.4 With the above determined average tariff increase/decrease, the Commission has

determined the category-wise tariffs in line with the tariff philosophy adopted by it

in the past, and the provisions of law. The tariffs and tariff categorisation have been

determined so that the cross-subsidies are reduced gradually without subjecting any

consumer category to a tariff shock.

5.5.1.5 The Commission observed that RInfra-D represented RAC as a separate line item as

not included it retail tariff comparison. However, the Commission is of the opinion

though RAC would be charged as separate charge and its accounting would also be

separately for the reasons elaborated in Section 4 of this Order, but for the

estimation of landed cost of the consumers, it should be included to enable

consumers to understand the billing impact of revised tariffs. Normalised recovery

of Revenue Requirement after including RAC as approved earlier in this section is

as under:

Table 147: Net Revenue Requirement and normalised recovery for the second

Control Period at existing tariff approved by the Commission including Regulatory

Asset Recovery (Rs Crore)


Adjusted Revenue Requirement from Retail Tariff 4663.85 4191.32 3795.79

Regulatory Asset recovery through RAC from Retail

Consumers of RInfra-D 601.33 588.84 578.20

Total Revenue Requirement from Retail Tariff including

Regulatory Asset recovery 5,262.98 4,780.20 4,375.47


Page 200 of 302


Revenue from Existing Tariff including RAC 5,253.52 5,455.45 4,980.70

Revenue Gap/ (Surplus) 9.46 (675.24) (605.23)


Average Tariff Increase including RAC 0.18% -12% -12%

5.5.2 Ceiling Tariff

5.5.2.1 Shri Shirish Deshpande of MGP during the Public Hearing has suggested that the

Commission should determine the ceiling tariffs in RInfra’s area of supply

5.5.2.2 Section 62 (1) of EA, 2003 states:

“The Appropriate Commission shall determine the tariff in accordance with the

provisions of this Act for –

...

(d) retail sale of electricity.

Provided that in case of distribution of electricity in the same area by two or more

distribution licensees, the Appropriate Commission may, for promoting competition

among distribution licensees, fix only maximum ceiling of tariff for retail sale of

electricity...”

5.5.2.3 The Commission noted that the sales and revenue mix of RInfra-D is as under:

Domestic 63%

LT Industrial 5%

HT Industrial 1%

Agriculture 0%

Commercial (HT+LT)

28%

Others 3%

Sales (MU) Domestic

LT Industrial

HT Industrial

Agriculture

Commercial (HT+LT) Others

FY 13- Actual RInfra-D


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5.5.2.4 It is clear from the above charts that the sales to domestic category of RInfra-D

contributes 63% of sales and 48 % of revenue of RInfra-D. Also it also noted that

industrial sales is around 6% of sales mix of RInfra-D contributing to 8% of

revenue, whereas sales to commercial consumers is 28% of sales mix contributing

around 39% of revenue of RInfra-D.

5.5.2.5 The Commission noted that the sales and revenue mix of TPC-D is as under:

Domestic 48%

LT Industrial 6%

HT Industrial 2%

Agriculture 0%

Commercial (HT+LT) 39%

Others 5%

Revenue (Rs Cr)

Domestic

LT Industrial

HT Industrial

Agriculture

Commercial (HT+LT)

Others

FY 13- Actual RInfra-D

Domestic 16%

LT Industrial 10%

HT Industrial 20%

Railways 13%


Others 1%

Sales (MU)

Domestic

LT Industrial

HT Industrial

Railways

Commercial (HT+LT)

Others

FY 13- Actual TPC-D


Page 202 of 302

5.5.2.6 It is clear from the above charts that the sales to domestic category of TPC-D

contributes 16% of sales and 11 % of revenue of TPC-D. Also it also noted that

industrial sales including railways is around 43% of sales mix of TPC-D

contributing to 45 % of revenue, whereas sales to commercial consumers is 40 % of

sales mix contributing around 43% of revenue of RInfra-D.

5.5.2.7 The Commission notes that sales and revenue mix of RInfra-D and TPC-D is

distinct and heterogeneous in nature and fixing ceiling tariff would require

homogeneous sales and revenue mix of the Licensees for whom ceiling needs to

fixed.

5.5.2.8 The Commission further notes that are several operational and legal issues that need

to be debated before implementation of the ceiling tariff and without consideration

of the same, it will not be appropriate to consider implementation of ceiling tariff.

Hence, the Commission has not considered this suggestion for tariff design in this

Tariff Order.

Domestic 11%

LT Industrial 10%

HT Industrial 21% Railways

14%


Others 1%

Revenue (Rs Cr)

Domestic

LT Industrial

HT Industrial

Railways

Commercial (HT+LT)

Others

FY 13- Actual TPC-D


Page 203 of 302

5.5.3 Rationalisation of Tariff Categories/Consumption Slabs

5.5.3.1 In the previous Tariff Orders, the Commission has already rationalised the consumer

categories and consumption slabs across different Distribution Licensees in the State

of Maharashtra, to a large extent. In this MYT Order, the Commission has created a

new Tariff Category for ‘Public Services’ in HT and LT segments, i.e., HT VI -

Public Services and LT X – Public Services. The rationale for creation of these

categories, and the basis for determining the tariff for these newly created categories

are explained below.

5.5.3.2 In compliance with the Judgment of the Hon’ble Appellate Tribunal, the

Commission, vide its Order dated 16 August, 2012 in Case No. 19 of 2012 on

MSEDCL’s Petition seeking tariff determination for FY 2012-13, created the

categories of LT Public Services and HT Public Services, with the definition of HT

Public Services being modified vide the Supplemental Order dated 22 May, 2013.

The Commission has included Airports as well as other similar infrastructure

services under the Public Services category, in case of MSEDCL.

5.5.3.3 The Commission has adopted the same philosophy, while creating the categories of

LT Public Services and HT Public Services, and the applicability of this category is

defined below:

LT IX - Public Services

Applicability - This Tariff shall be applicable to educational institutions, hospitals,

dispensaries, primary health care centres, pathology laboratories, Spiritual

Organisations which are service oriented, Police Stations, Post Offices, Defence

establishments (army, navy and air force), Public libraries and Reading rooms,

Railway except traction (shops on the platforms/railway station/bus stands will be

billed under Commercial category as per the respective slab), State transport

establishments; Railway and State Transport Workshops, Fire Service Stations,

Jails, Prisons, Courts, Airports, Sports Club / Health Club / Gymnasium /

Swimming Pool attached to the Educational Institution / Hospital provided said

Sports Club / Health Club / Gymnasium / Swimming Pool is situated in the same

premises and is exclusively meant for the students / patients of such Educational

Institutions and Hospitals.


Page 204 of 302

HT VI - Public Services

Applicability - This Tariff shall be applicable to educational institutions, hospitals,

dispensaries, primary health care centres, pathology laboratories, Spiritual

Organisations which are service oriented, Police Stations, Post Offices, Defence

establishments (army, navy and air force), Public libraries and Reading rooms,

Railway except traction (shops on the platforms/railway station/bus stands will be

billed under Commercial category as per the respective slab), State transport

establishments; Railway and State Transport Workshops, Fire Service Stations,

Jails, Prisons, Courts; Airports, Sports Club / Health Club / Gymnasium /

Swimming Pool attached to the Educational Institution / Hospital provided said

Sports Club / Health Club / Gymnasium / Swimming Pool is situated in the same

premises and is exclusively meant for the students / patients of such Educational


5.5.3.4 In its reply to data gaps, RInfra-D submitted that at present no description of type of

use is provided against consumer account numbers in the billing database and it is

presently not possible to extract the type of consumers specified in public services

category. Hence, the Commission is not in a position to ascertain the impact of such

categorisation owing to paucity of data and shall undertake true-up of impact of

such categorisation at the time of truing up, subject to prudence check.

5.5.3.5 The tariff for the Public Service category has been determined by giving due

weightage to the tariffs determined for industrial and commercial category, such that

the tariffs are in-between the tariffs applicable for industrial category and

commercial category.

5.5.3.6 As regards to proposed new category for Railways, the Commission has accepted

creation of new category as proposed by RInfra-D. The tariff for the HT V- HT

Railways category has been determined by giving due weightage to the tariffs

determined for industrial and commercial category, such that the tariffs are in-

between the tariffs applicable for industrial category and commercial category.

5.5.3.7 The applicability of tariffs for different consumer categories has been stipulated in

the approved Tariff Schedule, which is annexed as a part of this Order (Annexure

II).


Page 205 of 302

“32. Ideally, the network costs can be split into the partial costs of the different

voltage level and the cost of supply at a particular voltage level is the cost at that

voltage level and upstream network. However, in the absence of segregated

network costs, it would be prudent to work out the voltage-wise cost of supply

taking into account the distribution losses at different voltage levels as a first

major step in the right direction. As power purchase cost is a major component

of the tariff, apportioning the power purchase cost at different voltage levels

taking into account the distribution losses at the relevant voltage level and the

upstream system will facilitate determination of voltage wise cost of supply,

though not very accurate, but a simple and practical method to reflect the actual

cost of supply.”

...

“34. Thus Power Purchase Cost which is the major component of tariff can be

segregated for different voltage levels taking into account the transmission and

distribution losses, both commercial and technical, for the relevant voltage level

and upstream system. As segregated network costs are not available, all the

other costs such as Return on Equity, Interest on Loan, depreciation, interest

on working capital and O&M costs can be pooled and apportioned equitably, on

pro-rata basis, to all the voltage levels including the appellant’s category to

determine the cost of supply. Segregating Power Purchase cost taking into

account voltage-wise transmission and distribution losses will be a major step in

the right direction for determining the actual cost of supply to various

consumer categories. All consumer categories connected to the same voltage

will have the same cost of supply. Further, refinements in formulation for cost

of supply can be done gradually when more data is available.”

...

“37. We, however, direct the State Commission to determine the cross subsidy for

each consumer category after working out the voltage-wise cost of supply based

on the directions given in the preceding paragraphs. The cross subsidy will be

calculated as the difference between the average tariff realization for that

category as per the Annual Revenue Requirement and the cost of supply for the

consumer category based on voltage-based cost of supply.”(emphasis added)


Page 206 of 302

5.5.3.8 As can be seen from the above extract of the Hon’ble Appellate Tribunal’s

Judgment, the Hon’ble Tribunal has ruled that the voltage-wise cost of supply

should be used to determine the category-wise cross-subsidy, and in the absence of

requisite data, the Hon’ble Tribunal has further advised that the power purchase

costs, which are the major component of the Distribution Licensee’s costs, can be

apportioned to different voltage levels in proportion to the distribution losses at the

respective voltage levels.

5.5.3.9 The Commission observed that in case of RInfra-D, wheeling losses for HT and LT

level are available but applying average power purchase cost to LT and HT level to

determine cost results in average voltage wise supply. The Commission further

notes that such a tariff design on the basis on average voltage wise cost of supply

would lead to tariff shock to certain categories of consumers. Moreover, RInfra-D

has not submitted the details of Voltage-wise Cost of Supply in the MYT Petition

that was published for public comments.

5.5.3.10 Also, the consumers have not had the opportunity to give their comments and

suggestions on the proposal to determine tariffs and cross-subsidy on the basis of

voltage-wise cost of supply.

5.5.3.11 In view of all the above reasons, the Commission is of the view that it would not be

appropriate to determine tariffs on the basis of voltage-wise cost of supply at this

point in time, and hence, for the purpose of this Order, the Commission has

continued to compute the cross-subsidy with respect to the Average Cost of Supply.

However, the Commission has attempted to ensure that the overall objective of

reduction of cross-subsidies to be within the limits of +20% of the Average Cost of

Supply, as laid down in the Tariff Policy as well as several Judgments of the

Hon’ble Tribunal.


Page 207 of 302

5.5.3.12 With regards to proposal of RInfra-D to increase ToD rebate during night hours.

The Commission observed that RInfra-D was not able to substantiate and establish

that the proposed rebate will lead to demand side management. Hence, the

Commission has rejected the proposal of increase of ToD rebate.

5.5.3.13 The Time of Day (ToD) tariffs will be applicable compulsorily to HT I, HT II, and

HT VI categories, and LT II (B) and (C), LT IV category consumers having TOD

meters, and LT X categories, as well as optionally available to LT- II (A) and LT III

category consumers, who have TOD meters.

5.5.4 Fuel Adjustment Charges

5.5.4.1 The existing Fuel Adjustment Cost (FAC) Charge has been equated to zero, on

account of the adoption of the existing fuel costs and power purchase costs for

projection of the power purchase expenses. In case of any variation in the fuel prices

and power purchase prices with respect to these levels, RInfra-D shall pass on

adjustments, due to changes in the cost of power procured due to change in fuel

cost, through the Fuel Adjustment Cost (FAC) component of Z-factor Charge, as

specified in Regulations 13.4 to 13.9 of the MERC MYT Regulations, 2011.

5.5.4.2 It should be noted that RInfra-D has already charged FAC for FY 2012-13 as well

as the initial months of FY 2013-14, vis-a-vis the fuel costs considered in the

prevailing Tariff Order and the Regulations considered for that Order (MERC Tariff

Regulations, 2005). However, the ARR for the Control Period from FY 2012-13 to

FY 2015-16 has been determined in accordance with MERC MYT Regulations, and

hence, RInfra-D has to resubmit post-facto vetting for this period would have to be

done vis-a-vis the norms specified in the MERC MYT Regulations and the fuel

costs considered in this Order for FY 2012-13 and thereafter. Any difference,

positive or negative, due to the change in applicability of Regulations considered for

charging FAC and that considered for vetting, vis-a-vis the FAC already charged by

RInfra-D for these periods, shall be passed through in the second half of FY 2014-

15 and spread over the six months of H2 of FY 2014-15, after approval by the

Commission.


Page 208 of 302

5.5.4.3 RInfra-D shall submit the details in the stipulated format to the Commission for the

first half of FY 2013-14, for prior approval of Z-factor charge to be recovered in the

second Control Period, as stipulated by the Commission, within sixty (60) days of

completion of first half.

5.5.4.4 Thereafter, RInfra-D shall submit details in the stipulated format to the Commission

for the subsequent half yearly periods of the second Control Period, for prior

approval of Z-factor charge to be recovered in the ensuing half yearly periods of the

second Control Period, within 60 days of completion of such half. Further, RInfra-D

shall submit the Z-factor Charge levied to all consumers for the preceding half

yearly period vis-a-vis the Z-factor component recoverable, along with the detailed

computations and supporting documents as may be required for verification by the

Commission.


Page 209 of 302

5.5.5 Cross-Subsidy Reduction Trajectory

5.5.5.1 The Comparison of category-wise Average Billing Rate including RAC and cross-

subsidy reduction trajectory approved by the Commission for FY 2013-14 is given

in the Tables below:

Consumer Category

Consumption SlabsExisting

Tariff

Revised

Tariff

ABR

(Rs/kWh)

%

Increase

ABR

(Rs/kWh)

%

Increase

LT I - Below Poverty Line 0.97 2.39 147% 2.35 142% 12% 29%

LT -I Residential (Single Phase) -

0-100 3.65 4.79 31% 4.14 13% 46% 52%

101-300 7.12 8.48 19% 7.68 8% 89% 96%

301-500 11.19 12.14 8% 9.66 -14% 140% 121%

501 and above 12.88 13.83 7% 12.31 -4% 161% 154%

LT -I Residential Three phase -

0-100 3.73 4.93 32% 4.16 12% 47% 52%

101-300 6.87 8.11 18% 7.14 4% 86% 89%

301-500 11.18 12.13 8% 9.47 -15% 140% 119%

501 and above 12.72 13.59 7% 12.15 -4% 159% 152%

LT II (a) - 0-20 kW 10.09 11.10 10% 9.44 -6% 126% 118%

LT II (b) - >20-50 kW 12.86 13.03 1% 12.37 -4% 161% 155%

LT II (c) - above 50 kW 13.57 13.64 1% 12.81 -6% 170% 161%

LT III - LT Industrial upto 20 kW 9.44 10.35 10% 9.45 0% 118% 118%

LT IV - LT Industrial above 20 kW 9.29 10.40 12% 9.54 3% 116% 120%

LT-V : LT- Advertisements and Hoardings 21.69 21.76 0% 21.01 -3% 272% 263%

LT VI: LT -Street Lights 10.36 11.36 10% 10.41 0% 130% 130%

LT-VII (A): LT -Temporary Supply Religious 6.99 9.13 31% 9.33 33% 88% 117%

LT-VII (B): LT -Temporary Supply Others 18.79 19.68 5% 19.47 4% 235% 244%

LT VIII: LT - Crematorium & Burial Grounds 4.55 5.73 26% 5.28 16% 57% 66%

LT IX: LT -Agriculture 0.95 2.06 117% 2.10 122% 12% 26%

Total LT 7.84 8.90 14% 7.83 -0.10% 98% 98%

HT

HT I: HT-Industry 9.43 9.37 -1% 9.54 1% 118% 120%

HTII : HT- Commercial 10.50 10.33 -2% 11.07 5% 132% 139%

HT III: HT-Group Housing Society 6.43 7.81 21% 7.28 13% 81% 91%

HTIV : HT - Temporary Supply 13.00 13.85 6% 14.54 12% 163% 182%

HT - Railway (New Category) 10.38 6.71 -35% 10.28 -1% 130% 129%

Total HT 10.04 9.46 -6% 10.43 4% 126% 131%

Total 7.97 8.93 12% 7.98 0.14% 100% 100%

7.98

7.98

ABR/ ACoS (%)

Average

Cost of

Supply

(Rs/kWh)

Average

Billing Rate

at Existing

Tariff

(including

FAC)

Tariff Proposed by

RInfra-D (including

RAC)

Average Billing Rate (Rs/kWh)

Revised Tariff

(including RAC)


Page 210 of 302

5.5.5.2 The Comparison of category-wise Average Billing Rate and cross-subsidy reduction

trajectory approved by the Commission for FY 2014-15 is given in the Tables

below:

Consumer Category


Tariff

Revised

Tariff

ABR

(Rs/kWh)

%

Increase

ABR

(Rs/kWh)% Increase

LT I - Below Poverty Line 2.33 2.35 1% 2.48 6% 33% 35%


0-100 4.13 4.75 15% 4.06 -2% 59% 58%

101-300 7.67 8.46 10% 6.40 -17% 109% 91%

301-500 9.65 10.84 12% 6.99 -28% 137% 99%

501 and above 12.30 12.56 2% 9.10 -26% 175% 129%

LT -I Residential Three phase -

0-100 4.15 4.89 18% 4.08 -2% 59% 58%

101-300 7.13 8.07 13% 5.85 -18% 101% 83%

301-500 9.46 10.82 14% 6.81 -28% 134% 97%

501 and above 12.14 12.33 2% 8.95 -26% 173% 127%

LT II (a) - 0-20 kW 9.42 10.56 12% 8.58 -9% 134% 122%

LT II (b) - >20-50 kW 12.35 11.33 -8% 10.76 -13% 175% 153%

LT II (c) - above 50 kW 12.78 11.74 -8% 11.25 -12% 182% 160%

LT III - LT Industrial upto 20 kW 9.44 9.42 0% 8.11 -14% 134% 115%

LT IV - LT Industrial above 20 kW 9.52 9.49 0% 8.19 -14% 135% 116%

LT-V : LT- Advertisements and Hoardings 20.98 20.66 -2% 18.91 -10% 298% 269%

LT VI: LT -Street Lights 10.39 10.79 4% 8.78 -16% 148% 125%

LT-VII (A): LT -Temporary Supply Religious 9.28 8.56 -8% 8.79 -5% 132% 125%

LT-VII (B): LT -Temporary Supply Others 19.47 18.47 -5% 18.56 -5% 277% 264%


LT IX: LT -Agriculture 1.99 2.03 2% 2.13 7% 28% 30%

Total LT 7.86 8.49 8% 6.88 -12.49% 112% 98%

HT -

HT I: HT-Industry 9.76 8.74 -11% 8.15 -17% 139% 116%

HTII : HT- Commercial 11.01 9.40 -15% 9.93 -10% 156% 141%

HT III: HT-Group Housing Society 7.28 7.62 5% 7.24 0% 103% 103%

HTIV : HT - Temporary Supply 14.54 13.18 -9% 12.70 -13% 207% 180%


Total HT 10.52 8.86 -16% 9.35 -11% 149% 133%

Total 8.03 8.52 6% 7.04 -12% 114% 100%

7.04

7.04

Average

Cost of

Supply

(Rs/kWh)

Average

Billing Rate

at Existing

Tariff

(including

FAC)

Average Billing Rate (Rs/kWh) ABR/ ACoS (%)

Tariff Proposed by

RInfra-D (including

RAC)

Revised Tariff

(including RAC)


Page 211 of 302

5.5.5.3 The Comparison of category-wise Average Billing Rate and cross-subsidy reduction

trajectory approved by the Commission for FY 2015-16 is given in the Tables

below:

5.5.5.4 The above Tables show that the Commission has reduced the cross-subsidy levels

for most consumer categories.

Consumer Category


Tariff

Revised

Tariff

ABR

(Rs/kWh)

%

Increase

ABR

(Rs/kWh)

%

Increase

LT I - Below Poverty Line 2.48 2.37 -4% 2.48 0% 40% 40%


0-100 4.06 4.94 22% 4.04 0% 65% 65%

101-300 6.40 8.69 36% 6.03 -6% 103% 97%

301-500 6.99 10.78 54% 6.65 -5% 112% 107%

501 and above 9.10 12.51 37% 7.70 -15% 146% 124%

LT -I Residential Three phase 0.00 1.02 -

0-100 4.08 5.07 24% 4.06 0% 66% 65%

101-300 5.85 8.27 41% 5.48 -6% 94% 88%

301-500 6.81 10.77 58% 6.47 -5% 109% 104%

501 and above 8.95 12.29 37% 7.56 -16% 144% 121%

LT II (a) - 0-20 kW 8.58 10.79 26% 6.67 -22% 138% 107%

LT II (b) - >20-50 kW 10.76 11.27 5% 7.94 -26% 173% 127%

LT II (c) - above 50 kW 11.25 11.67 4% 9.31 -17% 181% 149%

LT III - LT Industrial upto 20 kW 8.11 9.37 15% 7.04 -13% 130% 113%

LT IV - LT Industrial above 20 kW 8.19 9.43 15% 7.10 -13% 131% 114%

LT-V : LT- Advertisements and Hoardings 18.91 21.12 12% 16.77 -11% 303% 269%

LT VI: LT -Street Lights 8.78 10.99 25% 7.12 -19% 141% 114%

LT-VII (A): LT -Temporary Supply Religious 8.79 8.72 -1% 8.24 -6% 141% 132%

LT-VII (B): LT -Temporary Supply Others 18.56 18.79 1% 16.46 -11% 298% 264%


LT IX: LT -Agriculture 2.13 2.03 -5% 2.34 9% 34% 38%

Total LT 6.88 8.68 26% 6.05 -12.01% 110% 97%

HT -

HT I: HT-Industry 8.15 8.75 7% 7.89 -3% 131% 127%

HTII : HT- Commercial 9.93 9.32 -6% 8.78 -12% 159% 141%

HT III: HT-Group Housing Society 7.24 7.97 10% 7.21 -1% 116% 116%

HTIV : HT - Temporary Supply 12.70 13.38 5% 10.52 -17% 204% 169%


Total HT 9.35 8.84 -5% 8.40 -10% 150% 135%

ABR 7.04 8.69 24% 6.23 -11% 113% 100%

ABR/ ACoS (%)

Tariff Proposed by

RInfra-D (including

RAC)

Revised Tariff

(including RAC)

6.23

6.23

Average

Cost of

Supply

(Rs/kWh)

Average

Billing Rate

at Existing

Tariff

(including

FAC)

Average Billing Rate (Rs/kWh)


Page 212 of 302

5.5.5.5 While the tariffs have been determined such that the revenue gap allowed to be

recovered through the revised tariffs is met entirely through the revision in tariffs, it

is possible that the actual revenue earned by RInfra-D may be higher or lower than

that considered by the Commission, on account of the changes in consumption

pattern. The revenue shortfall/surplus if any will be trued up based on actuals.

5.5.5.6 It should be noted that all previous clarifications given by the Commission through

its various Orders continue to be applicable, unless they are specifically contrary to

anything that has been stated in this Order, wherein the clarifications given in this

Order shall prevail.

5.5.5.7 The Case No. 85 of 2013, which is a review of the actions taken by TPC-D on Order

of the Commission in Case No. 151 of 2011, is under hearing with the Commission.

The Commission is of the view that the Judgement/Ruling arrived at in Case No. 85

of 2013 will impact the sales and revenue of both RInfra-D and TPC-D, both of

whom have a Universal Service Obligation in the same area of Supply. The effect of

above mentioned impact on this MYT Order of RInfra-D and the MYT Order of

TPC-D issued on 28 June, 2013 in Case No. 179 of 2011 will be considered by the

Commission and the appropriate consequent Orders will be issued.

5.6 REVISED TARIFFS WITH EFFECT FROM 1 September, 2013 (for FY 2013-14)

Sl. Consumer category &

Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)

LOW TENSION CATEGORIES

1 LT I - Residential (BPL) Rs. 5 per month 1.22 0.11 0.19

LT I – Residential

0-100 units Rs. 40 per

month$$

1.22 2.23 0.48

101-300 units Rs. 75 per 1.22 4.78 0.84


Page 213 of 302


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)

301 to 500 units month$$

1.22 6.78 1.12

Above 500 units (balance units) Rs. 100 per

month$$

1.22 9.28 1.47

2 LT II - LT Commercial

(A) 0-20 kW Rs. 250 per

month

1.22 6.30 1.05

(B) > 20 kW and < 50 kW Rs. 200 per kVA

per month

1.22 8.78 1.40

(C) > 50 kW 1.22 9.23 1.46

3 LT III - LT Industrial below 20 kW

load

Rs. 250 per

month

1.22 6.78 1.12

4 LT IV - LT Industrial above 20 kW Rs. 200 per kVA

per month

1.22 6.53 1.08

5 LT V - Advertisement & Hoardings,

incl. floodlights & neon signs

Rs. 400 per

month

1.22 15.78 2.38

6 LT VI – Streetlights Rs 200 per kVA

per month#

1.22 7.28 1.19

7 LT VII – Temporary Supply

(A) TSR – Temporary Supply Religious Rs 200 per month 1.22 4.78 0.84

(B) TSO – Temporary Supply Others Rs 200 per month 1.22 15.78 2.38

8 LT VIII – Crematoriums and Burial

Grounds

Rs 200 per month 1.22 3.37 0.64

9 LT IX – Agriculture Rs 20 per HP per

month

1.22 0.64 0.24

10 LT X- Public Services Rs. 250 per

month

1.22 6.59 1.09


Page 214 of 302


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)

TOD Tariffs (in addition to above base

tariffs) – compulsory for LT II (B) and

(C), LT IV, and LT X category, and

optional for LT II (A) and LT III

category

0600 hours to 0900 hours 0.00




2200 hours to 0600 hours -0.75

HIGH TENSION CATEGORIES

10 HT I – Industry Rs 200 per kVA

per month

0.63 7.37 1.12

11 HT II – Commercial Rs 200 per kVA

per month

0.63 8.42 1.27

12 HT III – Group Housing Society Rs 200 per kVA

per month

0.63 5.37 0.84

13 HT IV – Temporary Supply Rs 200 per

connection per

month

0.63 12.12 1.78

14 HT V – Railways Rs 200 per kVA

per month

0.63 7.87 1.19

15 HT VI – Public Services Rs 200 per kVA

per month

0.63 7.87 1.19


tariffs) for HT I, HT II and HT VI


Page 215 of 302


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)

categories






Notes:

1. Fuel Adjustment Cost (FAC) will be applicable to all consumers and will be charged over the above tariffs, on

the basis of the FAC formula prescribed by the Commission.

2. $$: Fixed charge of Rs. 100 per month will be levied on residential consumers availing 3 phase supply.

Additional Fixed Charge of Rs. 100 per 10 kW load or part thereof above 10 kW load shall be payable.

3. #: Street lightings having 'automatic timers' for switching 'on/off' would be levied Demand Charges on the

lower of the following:

(A. 50% of the Contract Demand

(B. Actual Recorded Demand


Page 216 of 302

5.7 REVISED TARIFFS WITH EFFECT FROM 1 APRIL, 2014 (for FY 2014-15)


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)





month$$

1.24 2.11 0.57


month$$

1.24 3.58 0.74

301 to 500 units 1.24 4.36 0.86


month$$

1.24 6.36 1.17


(A) 0-20 kW Rs. 250 per

month

1.24 5.47 1.03


per month

1.24 7.26 1.31

(C) > 50 kW 1.24 7.76 1.39


load

Rs. 250 per

month

1.24 5.51 1.04


per month

1.24 5.26 1.00



Rs. 400 per

month

1.24 13.76 2.31


per month#

1.24 5.76 1.08




Page 217 of 302


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)



Grounds Rs 200 per month

1.24 3.76 0.77


month

1.24 0.61 0.28


month

1.24 5.49 1.04





category








per month

0.64 5.86 1.00


per month

0.64 7.36 1.23


per month

0.64 5.26 0.91


connection per

0.64 10.36 1.69


Page 218 of 302


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)

month

15 HT V – Railways (New Category) Rs 200 per kVA

per month

0.64 6.61 1.12

16 HT VI- Public Services Rs 200 per kVA

per month

0.64 6.61 1.12



categories






Notes:










Page 219 of 302

5.8 REVISED TARIFFS WITH EFFECT FROM 1 APRIL, 2015 (for FY 2015-16)


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)





month$$

1.27 2.03 0.56


month$$

1.27 3.18 0.75

301 to 500 units 1.27 3.98 0.89


month$$

1.27 5.23 1.07


(A) 0-20 kW Rs. 250 per

month

1.27 3.73 0.84


per month

1.27 4.73 1.01

(C) > 50 kW 1.27 5.98 1.22


load

Rs. 250 per

month

1.27 4.48 0.97


per month

1.27 4.23 0.93



Rs. 400 per

month

1.27 11.73 2.19


per month#

1.27 4.23 0.93




Page 220 of 302


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)



Grounds Rs 200 per month

1.27 3.83 0.86


month

1.27 0.73 0.34


month

1.27 4.18 0.92





category








per month

0.65 5.55 1.04


per month

0.65 6.30 1.17


per month

0.65 5.15 0.98


connection per

0.65 8.35 1.52


Page 221 of 302


Consumption Slab

Tariffs

Fixed/ Demand

Charge

Wheeling

Charges

(Rs/kWh)

Energy

Charge

(Rs/kWh)

Regulatory

Asset

Charge

(Rs/kWh)

month

15 HT V – Railways Rs 200 per kVA

per month

0.65 5.35 1.01

16 HT VI- Public Services Rs 200 per kVA

per month

0.65 5.35 1.01



categories






Notes:










Page 222 of 302

5.8.1.1 The category-wise revenue with revised tariffs excluding and including Regulatory

Asset Charge for FY 2013-14, FY 2014-15, and FY 2015-16 is given in Annexure I

to this Order.

5.8.1.2 The approved Tariff Schedule has been given as Annexure II (A), II (B) and II (C)

to this Order.

5.9 INCENTIVES AND DISINCENTIVES

5.9.1 Power Factor Incentive (Applicable for all HT categories, and LT II (B), LT II

(C), and LT IV categories)

5.9.1.1 Whenever the average power factor is more than 0.95, an incentive shall be given at

the rate of the following percentages of the amount of the monthly bill including

energy charges, reliability charges, FAC, and Fixed/Demand Charges, but excluding

Taxes and Duties:

Sl. Range of Power Factor Power Factor Level Incentive

1 0.951 to 0.954 0.95 0%

2 0.955 to 0.964 0.96 1%

3 0.965 to 0.974 0.97 2%

4 0.975 to 0.984 0.98 3%

5 0.985 to 0.994 0.99 5%

6 0.995 to 1.000 1.00 7%

Note: PF to be measured/computed upto 3 decimals, after universal rounding off

5.9.2 Power Factor Penalty (Applicable for all HT categories, and LT II (B), LT II

(C), and LT IV categories)

5.9.2.1 Whenever the average PF is less than 0.9, penal charges shall be levied at the rate of

the following percentages of the amount of the monthly bill including energy

charges, reliability charges, FAC, and Fixed/Demand Charges, but excluding Taxes

and Duties:


Page 223 of 302

Sl. Range of Power Factor Power Factor Level Penalty

1 0.895 to 0.900 0.90 0%

2 0.885 to 0.894 0.89 2%

3 0.875 to 0.884 0.88 3%

4 0.865 to 0.874 0.87 4%

5 0.855 to 0.864 0.86 5%

6 0.845 to 0.854 0.85 6%

7 0.835 to 0.844 0.84 7%

8 0.825 to 0.834 0.83 8%

9 0.815 to 0.824 0.82 9%

10 0.805 to 0.814 0.81 10%

... ... ... ...


5.9.3 Prompt Payment Discount

5.9.3.1 A prompt payment discount of one percent on the monthly bill (excluding Taxes

and Duties) shall be available to the consumers if the bills are paid within a period

of 7 working days from the date of issue of the bill.


Page 224 of 302

5.9.4 Delayed Payment Charges (DPC)

5.9.4.1 In case the electricity bills are not paid within the due date mentioned on the bill,

delayed payment charges of 2 percent on the total electricity bill (including Taxes

and Duties) shall be levied on the bill amount. For the purpose of computation of

time limit for payment of bills, “the day of presentation of bill” or “the date of the

bill” or "the date of issue of the bill", etc. as the case may be, will not be excluded.

5.9.5 Rate of Interest on Arrears

5.9.5.1 The rate of interest chargeable on arrears will be as given below for payment of

arrears-

5.9.6 Load Factor Incentive

5.9.6.1 Consumers having load factor over 75% upto 85% will be entitled to a rebate of

0.75% on the energy charges for every percentage point increase in load factor from

75% to 85%. Consumers having a load factor over 85 % will be entitled to rebate of

1% on the energy charges for every percentage point increase in load factor from

85%. The total rebate under this head will be subject to a ceiling of 15% of the

energy charges for that consumer. This incentive is limited to HT I, HT II, and HT

VI categories only. Further, the load factor rebate will be available only if the

consumer has no arrears with RInfra-D, and payment is made within seven days

from the date of the bill. However, this incentive will be applicable to consumers

where payment of arrears in instalments has been granted by RInfra-D, and the same

is being made as scheduled.

The Load Factor has been defined below:

Load Factor = Consumption during the month in MU

Maximum Consumption Possible during the month in MU

Sr.

No.Delay in Payment (months)

Interest Rate

p.a.

(%)

1 Payment after due date upto 3 months (0 - 3) 12%

2 Payment made after 3 months and before 6 months (3 - 6) 15%

3 Payment made after 6 months (> 6) 18%


Page 225 of 302

Maximum consumption possible = Contract Demand (kVA) x Actual Power

Factor x (Total no. of hrs during the month less planned load shedding hours*)

* - Interruption/non-supply to the extent of 60 hours in a 30 day month has been

built in the scheme.

5.9.6.2 In case the billing demand exceeds the contract demand in any particular month,

then the load factor incentive will not be payable in that month. (The billing demand

definition excludes the demand recorded during the non-peak hours, i.e., 22:00 hrs

to 06:00 hrs and therefore, even if the maximum demand exceeds the contract

demand in that duration, load factor incentives would be applicable. However, the

consumer would be subjected to the penal charges for exceeding the contract

demand and has to pay the applicable penal charges).

5.10 APPLICABILITY OF THE ORDER

5.10.1.1 This Order on the ARR of RInfra-D for MYT for the second Control Period from

FY 2012-13 to FY 2015-16 shall come into force with effect from 1 September,

2013 and shall continue to be in force for the entire Control Period till 31 March,

2016. The Commission will undertake the mid-term review of RInfra-D’s

performance during the third quarter of FY 2014-15. RInfra-D is directed to submit

its Petition for mid-term review of its performance during the third quarter of FY

2014-15, with detailed reasons for deviation in performance, latest by 30 November,

2014.

5.10.1.2 With the above, RInfra-D’s Petition in Case No.9 of 2013 stands disposed off.

Sd/- Sd/-

(Vijay L. Sonavane) (V. P. Raja)

Member Chairman


Page 226 of 302

Appendix -1

List of attendees for the Technical Validation Session dated February 8, 2013

Sr.

No. Name of the Attendee Institution/Individual

1 Shri Raksh Pal Abrol, Bharatiya

Udhami Avam Upbhokta Sangh

Consumer Representative u/s. 94(3) of the EA,

2003 for this Case

2 Shri Ashok Pendse, TBIA Consumer Representative u/s. 94(3) of the EA,

2003 for this Case

3 Shri D.Mishra Deloitte

4 Shri R.R.Mehta Reliance Infrastructure Ltd

5 Shri Kapil Sharma Reliance Infrastructure Ltd

6 Shri Vivek Mishra Reliance Infrastructure Ltd

7 Shri Kishor Patil Reliance Infrastructure Ltd

8 Shri Ganesh Balasubramaniam Reliance Infrastructure Ltd

9 Shri A.Saha Reliance Infrastructure Ltd

10 Shri Mohan Limaye Reliance Infrastructure Ltd

11 Smt. Vijaya Bhatawdekar Reliance Infrastructure Ltd

12 Smt. Shraddha Kaley Reliance Infrastructure Ltd

13 Smt Varsha Nijasure Reliance Infrastructure Ltd

14 Shri Anvesh Jain Reliance Infrastructure Ltd

15 Shri K.K.Chopra Individual


Page 227 of 302

Appendix -2

List of attendees for the Public Hearing dated April 06, 2013

Sr.


Consumer Representative u/s. 94(3) of the EA, 2003 for this Case

1 Shri N. Ponrathnam Vel Induction Hardenings

2 Shri Raksh Pal Abrol Bharatiya Udhami Avam Upbhokta Sangh

3 Shri Shirish Deshpande Mumbai Grahak Panchayat

4 Shri Sandeep Ohri Consumer Representative

Other Representatives

5

Shri Arun Kadam on behalf of Thakur

Ramesh Singh Individual

6 Shri Bhalchandra Mhatre Individual

7 Adv.Arun Jagtap Individual

8 Shri Atul Bhatkalkar Individual

9 Shri Gautam S. Jadhav Individual

10 Dr. Shataram Karande Individual

11 Smt. Mangala Kadam Individual

12 Smt. Ankita Salvi Individual

13 Shri. Mohmmad Qureshi Individual

14 Smt. Sneha Individual

15 Shri Jitu Pawar Individual

16 Shri Ulhas Chaudhari Individual

17 Shri Soumen Mukherjee Individual

18 Shri Mohmmad Sikandar Azam Individual

19 Smt Virginia Dias Individual

20 Shri Vishal C Rajani Individual

21 Smt. Manali Jadhav Individual

22 Representative Shree Swami Samarth Seva Mandal

23 Shri Santram Yadav Individual

24 Shri Sachin Gharat Individual

25 Smt. Nilam Dhavan Individual

26 Shri Chandrakant Mudras Individual

27 Shri Vishnu N. Mhatre Individual

28 Shri Bhaskar Bhoir Individual

29 Shri Sagar Vartak Individual

30 Shri Waris M. Khan Individual

31 Shri Rajesh Parab Individual


Page 228 of 302

Sr.


32 Representative AWEIS Electronics’ & Electricals

33 Shri Baban B. Kamble Individual

34 Shri Pradeep Bhogal Individual

35 Shri Subhash Desai Individual

36 Shri Dilip R. Murudkar Individual

37 Shri Arjunrao Kadam Individual

38 Shri Rajendra Pawar Individual

39 Shri Harishchandra Govalkar Individual

40 Shri Ganesh Khankar Individual

41 Shri George John Individual

42 Shri Shailesh Jayaswal Individual

43 Shri Vilas Karjawakar Individual

44 Shri Pravin Khedekar Individual

45 Smt. Samiksha Mali Individual

46 Shri Chandrakant Lad Individual

47 Smt.Sneha Shirke Individual

48 Shri Sandeep Yelmane Individual

49 Shri Ramesh Dubey Individual

50 Shri Anand Upadhyay Individual

51 Smt. Smita Matondkar Individual

52 Shri Singh Individual

53 Representative Chanakya Electric Works

54 Representative Kalika Electrical Enterprises

55 Shri Baban Chaskar Individual

56 Representative Himalaya Electric Works

57 Representative Mumbai Metro One Pvt. Ltd.

58 Shri Shaikh M. Hussain Individual

59 Representative Retailers Association Of India (Haria & Co)

60 Representative Shopping Association Of India

61 Adv. Mohit Jadhav Individual

62 Representative Indus Towers Ltd.

63 Representative Arch-V-Shan Creation’s

64 Representative Prana Studios Pvt. Ltd.

65 Shri N.A. Shaikh BMC

66 Shri A. R. Patane BMC

67 Shri Atul Kapadia Individual


Page 229 of 302

Sr.


68 Shri Rupesh Sankhe Individual

69 Shri Vinod Nibehe Individual

70 Shri Mahesh Joshi Individual

71 Shri Sachin Lade Individual

72 Smt.Chhavi Chauhan Individual

73 Shri Nishant Bhargvara Individual

74 Smt.Nutan Kolhatkar Individual

75 Shri. Sreeram Pethe Individual

76 Shri Sanjiv Shah Individual

77 Shri Jinag Shah Individual

78 Shri N. Thapar Individual

79 Shri S. Porkodi Individual

80 Shri Gaurav Gautam Individual

81 Shri R. Shrivastav Individual

82 Shri Ram Verma Individual

83 Shri Pankaj Bhargava Individual

84 Shri Rajiv Nauhare Individual

85 Smt. Pratima Bhargava Individual

86 Smt.Shital Khiraiya Tata Power Company Ltd.

87 Shri Jana Shewale Individual

88 Shri. Dipak S. Sakharkar Individual

89 Shri Suniel Shukla Individual

90 Smt.Swati Mehendale Tata Power Company Ltd.

91 Shri Suniel Shukla Individual

92 Shri Niranjan C.V. Individual

93 Smt. Aditi Sachdev Individual

94 Shri Rohit Jaiswal Individual

95 Shri P.P. Karhade Individual

96 Shri R. P. Kulkarni Individual

97 Shri H. C. Gokarni Individual

98 Shri M. D. Salvi Individual

99 Smt H. I. Inamdar Tata Power Co Ltd

100 Shri Sandeep Jain Individual

101 Shri Suhas N. Joshi Individual

102 Shri M. P. Kulkarni Individual

103 Smt. Chhaya Bhonslay Individual


Page 230 of 302

Sr.


104 Shri Runit N. Maru Individual

105 Shri Amberish Gaekwad Individual

106 Shri A. R. Waghmare Individual

107 Shri Satish Kasbe Individual

108 Shri Totaram B. Pawar Individual

109 Shri Parthav Sampat Individual

110 Shri Dattaram Ghuge Individual

111 Shri Basil Pereira Individual

112 Smt. Chandrama Rai LVPIN Ltd.

113 Shri M. K. Gupta Individual

114 Smt. Namrata Samant Individual

115 Shri K.K. Chopra Individual

116 Shri Aditya Individual

117 Smt Aditi Garg PWC

118 Shri Ganesh D. Individual

119 Shri Sachin Patil Individual

120 Shri Dattaram Ghuge Individual

121 Shri Bakulesh Motivala Individual

122 Shri Arvind Yadav Individual

123 Shri Kartik Krishnan Individual

124 Shri Hemant Wal Individual

125 Shri Manish Varshiriya Individual

126 Shri Narayanan V.T. Individual

127 Shri Subhadeep Ghosh Individual

128 Shri Mohmmad Afzal Consumer Human Right, RTI Activist

129 Shri Abhishek Ramkrishna Individual

130 Shri Deepak Ojha Individual

131 Smt Brinda Alankar Individual

132 Shri D. K. Das Individual

133 Shri Suresh Mahangade Individual

134 Shri Ashish Vhedanar Individual

135 Shri Mahesh Kajuleshwari Individual

136 Shri Karim Noorani Individual

137 Shri U. R. Nandanwankar Individual

138 Shri K. R. Cooper Individual

139 Shri Rajesh Mishra Individual


Page 231 of 302

Sr.


140 Shri Tushar Shah Individual

141 Smt Babita Mishra Individual

142 Shri Sachin Kale Individual

143 Shri Santosh Kalantri Individual

144 Shri Maruti Kheduskar Individual

145 Shri Chandrakant Sahu Individual

146 Shri Narendra Saha Individual

147 Shri B. H. Girae Individual

148 Shri D. M. Mathur Individual

149 Shri M. A. Chaudhary Individual

150 Shri Sanjeet Singh Individual

151 Shri Abhijit Dhamdhere Individual

152 Shri Viren Devathi Individual

153 Shri Arvind Shukla Individual

154 Shri Sachin Lade Individual

155 Shri Vinod Bhole Shopper’s Stop

156 Shri Nikam K.R. Individual

157 Shri Ramsambhar Yadav Individual

158 Shri S.N. Rao Individual

159 Shri Tarak Oza Individual

160 Shri Deepak Mhose Individual

161 Shri T.E. Shirke Individual

162 Shri Sunil Joglekar Tata Power Co Ltd

163 Shri Pradeep Jain Indian Hotel & Restaurant Association

164 Shri Prakash Khandve Prabodhan Samaj Unnati Kendra, Borivali

165 Smt.Shweta Tiwari Hypercity Retail Ltd.

166 Shri Dattatraya Chaugule Sushma Electric & Company

167 Shri Devendra Ambekar Individual

168 Shri Shyam Sonawane Individual

169 Mrs. Ankita Salgaonkar Individual

170 Shri .Rajesh Mishra Individual

171 Shri Sachitanand Mishra Individual

172 Shri Shashi Parmar Individual

173 Shri Bhavna Mhatre Individual

174 Shri Sandep Tale Individual

175 Smt. Ujjawla Mehta Individual


Page 232 of 302

Sr.


176 Shri Raees Shoppers Stop, Bandra

177 Shri Viplav Avasare Individual

178 Shri Kiran Dhanana Individual

179 Shri C.J.D’Souza Individual

180 Shri R.S. Panchul Individual

181 Shri V.J.Ghodekar Individual

182 Shri Amey Naik Individual

183 Shri Bankim B Individual

184 Shri P.Mughukumar Individual

185 Shri Shamim Longekar Individual

186 Smt Laxmibai Individual

187 Smt Santabai Pawar Individual

188 Shri Umesh Rane Individual

189 Shri Naresh R.R. Individual

190 Representative

Bharatiya Republican Party Bahujan

Mahasangh

191 Representative Samarth Electricals

192 Shri Jitendra Tarde Individual

193 Shri Vilas Potnis Individual

194 Shri Gautam Jadhav Individual

195 Shri S.G.Mhaske Reliance Infrastructure Ltd

196 Shri Kishor Patil Reliance Infrastructure Ltd

197 Shri Vilas Kapile Reliance Infrastructure Ltd

198 Shri.Sridhar Krishnamurthy Reliance Infrastructure Ltd

199 Shri Kapil Sharma Reliance Infrastructure Ltd

200 Shri Vivek Mishra Reliance Infrastructure Ltd

201 Shri Ashok Kamble Reliance Infrastructure Ltd

202 Shri Ganesh Balsubramanian Reliance Infrastructure Ltd

203 Shri P.Pandya Reliance Infrastructure Ltd

204 Shri Karn Pallav Reliance Infrastructure Ltd

205 Shri Abaji Niralkar Reliance Infrastructure Ltd

206 Shri Ram Verma Reliance Infrastructure Ltd

207 Shri Anvesh Jain Reliance Infrastructure Ltd

208 Shri S.S.Chavan Reliance Infrastructure Ltd

209 Shri R Shanbhag Reliance Infrastructure Ltd

210 Shri R.R.Keelar Reliance Infrastructure Ltd

211 Shri N Sonawane Reliance Infrastructure Ltd


Page 233 of 302

Sr.


212 Shri Vivek Shah Reliance Infrastructure Ltd

213 Shri M.G.Andhari Reliance Infrastructure Ltd

214 Shri M.M.Kulkarni Reliance Infrastructure Ltd

215 Shri S Trivedi Reliance Infrastructure Ltd

216 Shri Nitin Kate Reliance Infrastructure Ltd

217 Shri Vivek Mane Reliance Infrastructure Ltd

218 Shri Debashish Banerjee Reliance Infrastructure Ltd

219 Shri S.Varadkar Reliance Infrastructure Ltd

220 Shri Jaykumar Waghela Reliance Infrastructure Ltd

221 Shri Sujit Rao Reliance Infrastructure Ltd

222 Shri Vinay Modi Reliance Infrastructure Ltd

223 Smt Neeta Dolas Reliance Infrastructure Ltd

224 Shri Prakash Pareria Reliance Infrastructure Ltd

225 Shri Waman Kadam Reliance Infrastructure Ltd

226 Shri Ankush Kamble Reliance Infrastructure Ltd

227 Shri R.A.Killekar Reliance Infrastructure Ltd


Page 234 of 302

Annexure-I

Revenue from Sale of Power at revised Tariffs for the Second Control period excluding

RAC (Rs Crore)


LT



0-100 593.90 653.31 643.92 643.52

101-300 754.33 764.01 609.07 547.39

301-500 172.63 148.27 110.26 107.54

500and above 69.91 66.97 51.30 44.96


0-100 65.96 71.81 71.48 72.13

101-300 181.03 180.29 146.72 136.28

301-500 150.77 126.14 92.94 90.45

500and above 277.85 263.73 200.30 174.39

LT II (a) - 0-20 kW 1,202.18 1,126.75 1,066.19 864.35

LT II (b) - 20-50 kW 159.04 154.92 141.71 110.24

LT II (c) - above 50 kW 274.25 265.59 250.10 221.85






Religious 0.67 0.88 0.86 0.82



Grounds 0.36 0.41 0.46 0.48


Total LT 4,388 4,310 3,828 3,407

HT - - - -

HT I: HT-Industry 71.03 72.15 61.00 59.86




HT - Railway (New Category) - 52.54 45.31 51.36

Total HT 245.75 354.51 364.25 389.15

Total Revenue from consumers 4,634 4,664 4,192 3,796


Page 235 of 302

Revenue from Sale of Power at revised Tariffs for the Second Control period including

RAC (Rs Crore)

Particulars FY 13-14 FY 14-15 FY 15-16

LT


LT -I Residential (Single Phase) - - -

0-100 739.61 737.67 746.47

101-300 857.76 689.03 625.25

301-500 167.70 125.78 124.08

500and above 76.04 58.87 52.19

LT -I Residential Three phase - - -

0-100 81.23 81.81 83.59

101-300 204.31 168.03 157.92

301-500 143.05 106.43 104.81

500and above 299.99 230.45 203.06

LT II (a) - 0-20 kW 1,268.07 1,211.97 989.60

LT II (b) - >20-50 kW 174.67 161.34 126.37

LT II (c) - above 50 kW 299.79 285.22 255.43






Religious 0.97 0.95 0.92



Grounds 0.46 0.53 0.56


Total LT 4,865 4,365 3,925

HT - - -

HT I: HT-Industry 79.47 69.54 69.02




HT - Railway (New Category) 59.41 51.77 59.30

Total HT 398.45 415.87 449.24

Total Revenue from consumers 5,263 4,780 4,375


Page 236 of 302

ANNEXURE II (A)

RELINACE INFRASTRUCTURE LIMITED

SCHEDULE OF ELECTRICITY TARIFFS

(With Effect from 1 September, 2013)

The Maharashtra Electricity Regulatory Commission, in exercise of the powers vested in it under

Section 61 and Section 62 of the Electricity Act, 2003 and all other powers enabling it in this

behalf, has determined, by its Order dated 1 September, 2013 in Case No.9 of 2013, the tariff

for supply of Electricity by Reliance Infrastructure Limited – Distribution Business’ (RInfra-D)

for various classes of consumers as applicable from 1 September, 2013.

General

1. These tariffs supersede all tariffs so far in force including in the case where any

agreement provides specifically for continuance of old agreemental tariff, or any

modifications thereof as may have been already agreed upon.

2. Tariffs are subject to revision and/or surcharge that may be levied by RInfra-D from time

to time as per the directives of the Commission.

3. The tariffs are exclusive of Electricity Duty, Tax on Sale of Electricity (ToSE) and other

charges as levied by Government or other competent authorities and the same, will be

payable by the consumers in addition to the charges levied as per the tariffs hereunder.

4. The tariffs are applicable for supply at one point only.

5. RInfra-D reserves the right to measure the Maximum Demand on any period shorter than

30 minutes period of maximum use, subject to conformity with the prevalent Supply

Code, in cases where RInfra-D considers that there are considerable load fluctuations in

operation

6. The tariffs are subject to the provisions of the MERC (Electricity Supply Code and Other

Conditions of Supply) Regulation, 2005 in force (i.e., as on 1 September, 2013) and

directions, if any that may be issued by the Commission from time to time.

7. Unless specifically stated to the contrary, the figures of Energy Charge relate to Rupees

per unit (kWh) charge for energy consumed during the month.

8. Fuel Adjustment Costs (FAC) Charge as may be approved by the Commission from time

to time shall be applicable to all categories of consumers and will be charged over and

above the tariffs on the basis of FAC formula specified by the Commission and computed

on a half-yearly basis.


Page 237 of 302

LOW TENSION (LT) TARIFF


Applicability

Residential consumers who have a sanctioned load of upto and less than 0.1 kW, and who have

consumed less than 360 units per annum in the previous financial year. The applicability of

Below Poverty Line (BPL) category will have to be assessed at the end of each financial year. In

case any BPL consumer has consumed more than 360 units in the previous financial year, then

the consumer will henceforth, be considered under the LT-I residential category. Once a

consumer is classified under the LT-I category, then he cannot be classified under BPL category.

The categorisation of such BPL consumers will be reassessed at the end of the financial year, on

a pro-rata basis. Similarly, the classification of BPL consumers who have been added during the

previous year would be assessed on a pro-rata basis, i.e., 30 units per month.

All the new consumers subsequently added in any month with sanctioned load of upto and less

than 0.1 kW and consumption between 1 to 30 units (on pro rata basis of 1 unit/day) in the first

billing month, will be considered in BPL Category.

Rate Schedule - Effective from 1 September, 2013 to 31 March, 2014 (FY 2013-14)

Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

BPL Category Rs. 5 per month 1.22 0.11 0.19

LT- I Residential (Single Phase)

Applicability

Electricity used at Low/Medium Voltage for operating various appliances used for purposes like

lighting, heating, cooling, cooking, washing/cleaning, entertainment/leisure, pumping in the

following places:

a) Private residential premises,

b) Premises exclusively used for worship such as temples, gurudwaras, churches, mosques, etc.

Provided that Halls, Gardens or any other portion of the premises that may be let out for


Page 238 of 302

consideration or used for commercial activities would be charged at LT-II tariff as

applicable.

c) All Students Hostels affiliated to Educational Institutions.

d) All Ladies Hostels, such as Students (Girls) Hostels, Working Women Hostels, etc.

e) Other type of Hostels, like (i) Homes/Hostels for Destitute, Handicap or Mentally deranged

persons (ii) Remand Homes (iii) Dharamshalas, etc., subject to verification and confirmation

by RInfra’s concerned Zonal Chief Engineer.

f) Telephone booth owned/operated by handicapped person subject to verification and

confirmation by RInfra’s concerned Zonal Chief Engineer.

g) Residential premises used by professionals like Lawyers, Doctors, Professional Engineers,

Chartered Accountants, etc., in furtherance of their professional activity in their residences

but shall not include Nursing Homes and any Surgical Wards or Hospitals.

Rate Schedule – Effective from 1 September, 2013 to 31 March, 2014 (FY 2013-14)

Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

0-100 units Rs. 40 per month$$

1.22 2.23 0.48

101 – 300 units Rs. 75 per month

$$

1.22 4.78 0.84

301 – 500 units 1.22 6.78 1.12

Above 500

units

(balance units)

Rs. 100 per

month$$

1.22 9.28 1.47

Note:

a) $$: Above fixed charges are for single phase connections. Fixed charge of Rs. 100 per

month will be levied on residential consumers availing 3 phase supply. Additional Fixed

Charge of Rs. 100 per 10 kW load or part thereof above 10 kW load shall be payable.

LT II: Low Tension – Non-Residential or Commercial


Page 239 of 302

Applicability

Electricity used at Low/Medium Voltage in all non-residential, non-industrial premises and/or

commercial premises for commercial consumption meant for operating various appliances used

for purposes such as lighting, heating, cooling, cooking, washing/cleaning, entertainment/leisure,

pumping in following places:

a) Non-Residential, Commercial and Business premises, including Shopping malls.

b) All Educational Institutions, Hospitals and Dispensaries.

c) Combined lighting and power services for Entertainment including film studios, cinemas and

theatres, including multiplexes, Hospitality, Leisure, Meeting Halls and Recreation places.

d) Electricity used for the external illumination of monumental/historical/heritage buildings

approved by MTDC.


Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

(a) 0-20 kW Rs. 250 per month 1.22 6.30 1.05

(b) > 20 kW and

≤ 50 kW Rs. 200 per kVA

per month

1.22 8.78 1.40

(c ) > 50 kW 1.22 9.23 1.46

TOD Tariffs (in addition to above base tariffs)

0600 to 0900 hours 0.00

0900 to 1200 hours 0.50

1200 to 1800 hours 0.00

1800 to 2200 hours 1.00

2200 to 0600 hours -0.75

Note:

a) The ToD tariff is available to LT-II (b) and (c) category, and optionally available to LT- II (a)

having ToD meter installed.


Page 240 of 302

LT III: LT- Industrial upto 20 kW

Applicability

Electricity used at Low/Medium Voltage in premises for purpose of manufacturing, including

that used within these premises for general lighting, heating/cooling, etc., having a sanctioned

load upto and including 20 kW (26.8 HP). This consumer category also includes IT industry and

IT enabled services (as defined in the Government of Maharashtra Policy).


Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs. /kWh)

Regulatory Asset

Charge

(Rs./kWh)

0-20 kW Rs. 250 per month 1.22 6.78 1.12

TOD Tariffs ( Optional - in addition to above base tariffs)

0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

Note:

a) The ToD tariff is optionally available to LT- III having ToD meter installed.

LT IV: LT– Industrial above 20 kW load

Applicability

Electricity used at Low/Medium Voltage in premises for purpose of manufacturing including that

used within these premises for general lighting, heating/cooling, etc. and having sanctioned load

greater than 20 kW (26.8 HP). This consumer category also includes IT industry and IT enabled

services (as defined in the Government of Maharashtra Policy).


Page 241 of 302


Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

Above 20 kW Rs. 200 per kVA per

month 1.22 6.53 1.08


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

LT V: LT - Advertisements and Hoardings

Applicability

Electricity used for the purpose of advertisements, hoardings and other conspicuous consumption

such as external flood light, displays, neon signs at departmental stores, malls, multiplexes,

theatres, clubs, hotels and other such entertainment/leisure establishments except those

specifically covered under LT-II as well as electricity used for the external illuminations of

monumental, historical/heritage buildings approved by MTDC, which shall be covered under

LT-II category depending upon Sanctioned Load.



Page 242 of 302

Consumption

Slab

( kWh)

Fixed /

Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

All Units Rs. 400 per

month 1.22 15.78 2.38

Note

a) The electricity, that is used for the purpose of indicating/displaying the name and other

details of the shops or Commercial premises, for which electric supply is rendered, shall

not be under LT V tariff Category. Such usage of electricity shall be covered under the

prevailing tariff of such shops or commercial premises.

LT VI: LT- Street Lights

Applicability

Electricity used at Low/Medium Voltage for purpose of public street lighting, lighting in public

gardens, traffic island, bus shelters, public sanitary conveniences, police chowkies, traffic lights,

public fountains, other such common public places irrespective of whether such facilities are

being provided by the Government or the Municipality, or Port Trust or other private parties.


Consumption

Slab

( kWh)

Fixed / Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

All Units Rs. 200 per kVA

per month 1.22 7.28 1.19

Note

Street Lightings having ‘Automatic Timers’ for switching On/Off the street lights would be

levied Demand Charges on lower of the following–

a) 50 percent of ‘Contract Demand’ or


Page 243 of 302

b) Actual ‘Recorded Demand’

LT VII: LT-Temporary Supply

Applicability

LT VII (A) – Temporary Supply Religious (TSR)

Electricity supplied at Low/Medium Voltage for temporary purposes during public religious

functions like Ganesh Utsav, Navaratri, Eid, Moharam, Ram Lila, Ambedkar Jayanti, Diwali,

Christmas, Guru Nanak Jayanti, etc., or areas where community prayers are held.

LT VII (B) - Temporary Supply Others (TSO)

Electricity used at Low/Medium Voltage on a temporary basis for any construction work,

decorative lighting for exhibitions, circus, film shooting, marriages, etc. and any activity not

covered under tariff LT VII (A), and electricity used at low/medium voltage on an emergency

basis for purpose of fire fighting activity by the fire department in residential/other premises.


Consumption

Slab (kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

( Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

LT VII (A) – All

Units

Rs. 200 per

connection per month 1.22 4.78 0.84

LT VII (B) – All

Units

Rs. 200 per

connection month 1.22 15.78 2.38

Note : In case of LT VII (B) the Additional fixed charges of Rs. 150 per 10 kW load or part

thereof above 10 kW load shall be payable.

LT VIII: LT- Crematorium and Burial Grounds

Applicability


Page 244 of 302

Electricity used at Low/Medium Voltage in Crematorium and Burial Grounds for all purposes

including lighting, and will be applicable only to the portion catering to such activities, and in

case part of the area is being used for other commercial purposes, then a separate meter will have

to be provided for the same, and the consumption in this meter will be chargeable under LT-II

Commercial rates as applicable.


Consumption

Slab (kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

( Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)



LT IX - LT- Agriculture

Applicability

Electricity used at Low/Medium Voltage by LT agricultural consumers for motive power loads

exclusively used for agricultural purposes.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

All Units Rs 20 per HP per

month 1.22 0.64 0.24

LT X - Public Services

Applicability


Page 245 of 302

This Tariff shall be applicable to Educational Institutions, Hospitals, dispensaries, primary health

care centres, pathology laboratories, Spiritual Organisations which are service oriented, Police

Stations, Post Offices, Defence establishments (army, navy and air-force), Public libraries and

Reading rooms, Railway except traction (shops on the platforms/railway station/bus stands will

be billed under Commercial category as per the respective slab), State transport establishments;

Railway and State Transport Workshops, Fire Service Stations, Jails, Prisons, Courts, Airports,

Sports Club / Health Club / Gymnasium / Swimming Pool attached to the Educational Institution

/ Hospital provided said Sports Club / Health Club / Gymnasium / Swimming Pool is situated in

the same premises and is exclusively meant for the students / patients of such Educational



Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory

Asset

Charge

(Rs./kWh)

All Units Rs 250 per month 1.22 6.59 1.09


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

HIGH TENSION (HT) - TARIFF

HT I: HT – Industry


Page 246 of 302

Applicability

This category includes consumers taking 3-phase electricity supply at High Voltage for purpose

of manufacturing. This Tariff shall also be applicable to IT Industry & IT enabled services (as

defined in the Government of Maharashtra policy), taking 3-phase electricity supply at High

Voltage.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

All Units Rs 200 per kVA

per month 0.63 7.37 1.12


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

HT II: HT- Commercial

Applicability

This category includes consumers of electricity such as all Educational Institutions, all Hospitals

taking supply at High Voltage.


Page 247 of 302

This category also includes consumers taking electricity supply at High Voltage for commercial

purposes, including Hotels, Shopping Malls, film studios, cinemas and theatres, including

multiplexes.

The Consumers belonging to HT II requiring a single point supply for the purpose of

downstream consumption by separately identifiable entities will have to either operate through a

franchisee route or such entities will have to take individual connections under relevant category.

These downstream entities will pay appropriate tariff as applicable as per RInfra Tariff Schedule

i.e. LT II.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.63 8.42 1.27


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

HT III: HT- Group Housing Society

Applicability


Page 248 of 302

This category includes Group Housing Societies taking single point electricity supply at High

Voltage for consumption by individual dwellings. Such individual dwellings will pay appropriate

tariff LT I: LT- Residential as per RInfra-D Tariff Schedule in force.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.63 5.37 0.84

HT IV- HT - Temporary Supply

Applicability

Electricity used at High Voltage on a temporary basis of supply for any construction work,

decorative lighting for exhibitions, circus, film shooting, marriages, etc.

This category also includes electricity supplied at High Voltage for temporary purposes during

public religious functions like Ganesh Utsav, Navaratri, Eid, Moharam, Ram Lila, Ambedkar

Jayanti, Diwali, Christmas, Guru Nanak Jayanti, etc. or areas where community prayers are held.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


connection per

month

0.63 12.12 1.78

HT V: HT– Railways

Applicability


Page 249 of 302

Applicable to electricity supply at 100 kV/33 kV/ 22 kV/11 kV/6.6 kV to Railways including

Metro and Monorail.


Consumption Slab

( kWh)

Fixed/

Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

100/33/22/11/6.6kV -

All Units

Rs. 200 per

kVA per month 0.63 7.87 1.19


Applicability

This Tariff shall be applicable to educational institutions, hospitals, dispensaries, primary health


Stations, Post Offices, Defence establishments (army, navy and air force), Public libraries and



Railway and State Transport Workshops, Fire Service Stations, Jails, Prisons, Courts; Airports,






Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.63 7.87 1.19


0600 to 0900 0.00


Page 250 of 302

Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

hours

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

MISCELLANEOUS AND GENERAL CHARGES

Fuel Adjustment Cost (FAC) Component of Z factor Charge

The FAC Component of Z factor charge will be determined based on the approved Formula and

relevant directions, as may be given by the Commission from time to time and will be applicable

to all consumer categories for their entire consumption.

In case of any variation in the fuel prices and power purchase prices with respect to these levels,

RInfra-D shall pass on adjustments, due to changes in the cost of power procured due to change

in fuel cost, through the Fuel Adjustment Cost (FAC) component of Z-factor Charge, as


The details of applicable ZFAC for each month shall be available on RInfra website

www.rinfra.com.

Electricity Duty and Tax on Sale of Electricity

The electricity duty and Tax on Sale of Electricity will be charged in addition to charges levied

as per the tariffs mentioned hereunder (as approved by the Commission) as per the Government

guidelines from time to time. However, the rate and the reference number of the Government

Resolution/ Order vide which the Electricity Duty and Tax on Sale of Electricity is made

http://www.rinfra.com/


Page 251 of 302

effective, shall be stated in the bill. A copy of the said resolution / Order shall be made available

on the website www.rinfra.com

Power Factor Calculation

Wherever, the average power factor measurement is not possible through the installed meter, the

following method for calculating the average power factor during the billing period shall be

adopted-

Average Power Factor = )(

)(

kVAhTotal

kWHTotal

Wherein the kVAh is = 22 )()( RkVAhkWh

(i.e. Square Root of the summation of the squares of kWh and RkVAh )

Power Factor Incentive (Applicable for all HT categories, LT II (B), LT II (C) and LT IV

categories)

Whenever the average power factor is more than 0.95, an incentive shall be given at the rate of

the following percentages of the amount of the monthly bill including energy charges, reliability

charges, FAC, and Fixed/Demand Charges, but excluding Taxes and Duties:


1 0.951 to 0.954 0.95 0%

2 0.955 to 0.964 0.96 1%

3 0.965 to 0.974 0.97 2%

4 0.975 to 0.984 0.98 3%

5 0.985 to 0.994 0.99 5%

6 0.995 to 1.000 1.00 7%




Page 252 of 302

Power Factor Penalty (Applicable for all HT categories, LT II (B), LT II (C) and LT IV

categories)

Whenever the average PF is less than 0.9, penal charges shall be levied at the rate of the

following percentages of the amount of the monthly bill including energy charges, reliability



1 0.895 to 0.900 0.90 0%

2 0.885 to 0.894 0.89 2%

3 0.875 to 0.884 0.88 3%

4 0.865 to 0.874 0.87 4%

5 0.855 to 0.864 0.86 5%

6 0.845 to 0.854 0.85 6%

7 0.835 to 0.844 0.84 7%

8 0.825 to 0.834 0.83 8%

9 0.815 to 0.824 0.82 9%

10 0.805 to 0.814 0.81 10%

... ... ... ...


Prompt Payment Discount

A prompt payment discount of one percent on the monthly bill (excluding Taxes and Duties)

shall be available to the consumers if the bills are paid within a period of 7 working days from

the date of issue of the bill.

Delayed Payment Charges (DPC)

In case the electricity bills are not paid within the due date mentioned on the bill, delayed

payment charges of 2 percent on the total electricity bill (including Taxes and Duties) shall be


Page 253 of 302

levied on the bill amount. For the purpose of computation of time limit for payment of bills, “the

day of presentation of bill” or “the date of the bill” or "the date of issue of the bill", etc. as the

case may be, will not be excluded.

Rate of Interest on Arrears

The rate of interest chargeable on arrears will be as given below for payment of arrears-

Sr.No. Delay in Payment ( months) Interest Rate per

annum (%)

1 Payment after due date upto 3 months ( 0-3) 12

2 Payment made after 3 months and before 6 months (3-6) 15

3 Payment made after 6 months (>6) 18

Load Factor Incentive

Consumers having load factor over 75% upto 85% will be entitled to a rebate of 0.75% on the

energy charges for every percentage point increase in load factor from 75% to 85%. Consumers

having a load factor over 85 % will be entitled to rebate of 1% on the energy charges for every

percentage point increase in load factor from 85%. The total rebate under this head will be

subject to a ceiling of 15% of the energy charges for that consumer. This incentive is limited to

HT I, HT II and HT VI categories only. Further, the load factor rebate will be available only if

the consumer has no arrears with RInfra-D, and payment is made within seven days from the

date of the bill. However, this incentive will be applicable to consumers where payment of

arrears in instalments has been granted by RInfra-D, and the same is being made as scheduled.

RInfra-D has to take a commercial decision on the issue of how to determine the time frame for

which the payments should have been made as scheduled, in order to be eligible for the Load

Factor incentive.




Maximum consumption possible = Contract Demand (kVA) x Actual Power Factor

x (Total no. of hrs during the month less planned load shedding hours*)

* - Interruption/non-supply to the extent of 60 hours in a 30 day month has been built in the

scheme.


Page 254 of 302

In case the billing demand exceeds the contract demand in any particular month, then the load

factor incentive will not be payable in that month. (The billing demand definition excludes the

demand recorded during the non-peak hours i.e. 22:00 hrs to 06:00 hrs and therefore, even if the

maximum demand exceeds the contract demand in that duration, load factor incentives would be

applicable. However, the consumer would be subjected to the penal charges for exceeding the

contract demand and has to pay the applicable penal charges).

Penalty for exceeding Contract Demand

In case, a consumer (availing Demand based Tariff) exceeds his Contract Demand, he will be

billed at the appropriate Demand Charge rate for the Demand actually recorded and will be

additionally charged at the rate of 150% of the prevailing Demand Charges (only for the excess

Demand over the Contract Demand).

In case any consumer exceeds the Contract Demand on more than three occasions in a calendar

year, the action taken in such cases would be governed by the Supply Code.

Additional Demand Charges for Consumers having Captive Power Plant

For customers having Captive Power Plant (CPP), the additional demand charges would be at a

rate of Rs. 20/kVA/month only on extent of Stand-by demand component, and not on the entire

Contract Demand. Additional Demand Charges will be levied on such consumers on the Stand-

by component, only if the consumer’s demand exceeds the Contract Demand.

Supply at 100 kV

a) In the event power is supplied at 100 kV, then the Consumer shall be allowed a rebate of 2%

of the monthly energy charges, over the energy charges applicable for supply at 11 kV/22 kV/33

kV.

Security Deposit

1) Subject to the provisions of sub-section (5) of Section 47 of the Act, RInfra-D would

require any person to whom supply of electricity has been sanctioned to deposit a security

in accordance with the provisions of clause (a) of subsection (1) of Section 47 of the

Electricity Act, 2003.

2) The amount of the security shall be an equivalent of the average of three months of

billing or the billing cycle period, whichever is lesser. For the purpose of determining the

average billing, the average of the billing to the consumer for the last twelve months, or


Page 255 of 302

in cases where supply has been provided for a shorter period, the average of the billing of

such shorter period, shall be considered

3) Where RInfra-D requires security from a consumer at the time of commencement of

service, the amount of such security shall be estimated by the Distribution Licensee based

on the tariff category and contract demand/sanctioned load, load factor, diversity factor

and number of working shifts of the consumer.

4) RInfra-D shall re-calculate the amount of security based on the actual billing of the

consumer once in each financial year.

5) Where the amount of security deposit maintained by the consumer is higher than the

security required to be maintained under this Supply Code Regulation 11, RInfra-D shall

refund the excess amount of such security deposit in a single payment: Provided that such

refund shall be made upon request of the person who gave the security and with an

intimation to the consumer, if different from such person, shall be, at the option of such

person, either by way of adjustment in the next bill or by way of a separate cheque

payment within a period of thirty (30) days from the receipt of such request: Provided

further that such refund shall not be required where the amount of refund does not exceed

the higher of ten (10) per cent of the amount of security deposit required to be maintained

by the consumer or Rupees Three Hundred.

6) Where the amount of security re-calculated pursuant as above, is higher than the security

deposit of the consumer, RInfra-D shall be entitled to raise a demand for additional

security on the consumer. Provided that the consumer shall be given a time period of not

less than thirty days to deposit the additional security pursuant to such demand.

7) Upon termination of supply, RInfra-D shall, after recovery of all amounts due, refund the

remainder amount held by the Distribution Licensee to the person who deposited the

security, with intimation to the consumer, if different from such person.

8) A consumer - (i) with a consumption of electricity of not less than one lakh (1,00,000)

kilo-watt hours per month; and (ii) with no undisputed sums payable to RInfra-D under

Section 56 of the Act may, at the option of such consumer, deposit security, by way of

cash, irrevocable letter of credit or unconditional bank guarantee issued by a scheduled

commercial bank.

9) RInfra-D shall pay interest on the amount of security deposited in cash (including cheque

and demand draft) by the consumer at a rate equivalent to the bank rate of the Reserve

Bank of India: Provided that such interest shall be paid where the amount of security

deposited in cash under this Regulation 11 of Supply Code is equal to or more than

Rupees Fifty.


Page 256 of 302

10) Interest on cash security deposit shall be payable from the date of deposit by the

consumer till the date of dispatch of the refund by RInfra-D.

Definitions:

Maximum Demand

Maximum Demand in Kilowatts or Kilo-Volt-Amperes, in relation to any period shall, unless

otherwise provided in any general or specific Order of the Commission, means twice the largest

number of kilowatt-hours or kilo-Volt-Ampere-hours supplied and taken during any consecutive

thirty minute blocks in that period.

Contract Demand

Contract Demand means demand in Kilowatt (kW) / Kilo –Volt Ampere (kVA), mutually agreed

between RInfra-D and the consumer as entered into in the agreement or agreed through other

written communication (For conversion of kW into kVA, Power Factor of 0.80 shall be

considered).

Sanctioned Load

Sanctioned Load means load in Kilowatt (kW) mutually agreed between RInfra-D and the

consumer

Billing Demand (for LT categories):



to 2200 hours.

b) 40% of the Contract Demand.

Note:

a) Demand registered during the period 0600 to 2200 Hrs. will only be considered

for determination of the Billing demand.


Page 257 of 302

b) In case of change in Contract Demand, the period specified in Clause (a) above

will be reckoned from the month following the month in which the change of

Contract Demand takes place.

Billing Demand (for HT categories):



hours.



c) 50% of the Contract Demand.

Note:







Page 258 of 302

ANNEXURE II (B)

RELIANCE INFRASTRUCTURE LIMITED


(With Effect from 1 April, 2014)





for various classes of consumers as applicable from 1 April, 2014

General













operation











Page 259 of 302



Applicability













Rate Schedule - Effective from 1 April, 2014 to 31 March, 2015 (FY 2014-15)

Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)



Applicability



following places:





applicable.


Page 260 of 302












Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)


1.24 2.11 0.57


$$

1.24 3.58 0.74

301 – 500 units 1.24 4.36 0.86

Above 500

units

(balance units)

Rs. 100 per

month$$

1.24 6.36 1.17

Note:





Applicability


Page 261 of 302










approved by MTDC.


Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

(a) 0-20 kW Rs. 250 per month 1.24 5.47 1.03

(b) > 20 kW and


per month

1.24 7.26

1.31

(c ) > 50 kW 1.24 7.76 1.39


0600 to 0900 hours 0.00

0900 to 1200 hours 0.50

1200 to 1800 hours 0.00

1800 to 2200 hours 1.00

2200 to 0600 hours -0.75

Note:




Page 262 of 302


Applicability






Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs. /kWh)

Regulatory Asset

Charge

(Rs./kWh)

0-20 kW Rs. 250 per month 1.24 5.51 1.04


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

Note:



Applicability






Page 263 of 302


Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


month 1.24 5.26 1.00


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75


Applicability









Page 264 of 302

Consumption

Slab

( kWh)

Fixed /

Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)


month 1.24 13.76 2.31

Note






Applicability






Consumption

Slab

( kWh)

Fixed / Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 1.24 5.76 1.08

Note





Page 265 of 302



Applicability











Consumption

Slab (kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

( Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

LT VII (A) – All

Units

Rs. 200 per


LT VII (B) – All

Units

Rs. 200 per





Applicability




Page 266 of 302





Consumption

Slab (kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

( Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)




Applicability




Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


month 1.24 0.61 0.28


Page 267 of 302


Applicability












Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory

Asset

Charge

(Rs./kWh)



0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75


Page 268 of 302



Applicability




Voltage.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.64 5.86 1.00


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75


Page 269 of 302


Applicability





multiplexes.





i.e. LT II.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.64 7.36 1.23


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75


Page 270 of 302


Applicability





Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.64 5.26 0.91


Applicability







Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


connection per

month

0.64 10.36 1.69


Page 271 of 302


Applicability


Metro and Monorail.


Consumption Slab

( kWh)

Fixed/

Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

100/33/22/11/6.6kV -

All Units

Rs. 200 per

kVA per month 0.64 6.61 1.12


Applicability












Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

All Units Rs 200 per kVA 0.64 6.61 1.12


Page 272 of 302

Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

per month


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75











www.rinfra.com.



Page 273 of 302







on the website www.rinfra.com Power Factor Calculation



adopted-


)(

kVAhTotal

kWHTotal




categories)





1 0.951 to 0.954 0.95 0%

2 0.955 to 0.964 0.96 1%

3 0.965 to 0.974 0.97 2%

4 0.975 to 0.984 0.98 3%

5 0.985 to 0.994 0.99 5%

6 0.995 to 1.000 1.00 7%




Page 274 of 302


categories)





1 0.895 to 0.900 0.90 0%

2 0.885 to 0.894 0.89 2%

3 0.875 to 0.884 0.88 3%

4 0.865 to 0.874 0.87 4%

5 0.855 to 0.864 0.86 5%

6 0.845 to 0.854 0.85 6%

7 0.835 to 0.844 0.84 7%

8 0.825 to 0.834 0.83 8%

9 0.815 to 0.824 0.82 9%

10 0.805 to 0.814 0.81 10%

... ... ... ...











Page 275 of 302






annum (%)
















Factor incentive.







scheme.


Page 276 of 302



















Supply at 100 kV



kV.

Security Deposit









Page 277 of 302






























commercial bank.





Rupees Fifty.


Page 278 of 302



Definitions:

Maximum Demand





Contract Demand




considered).

Sanctioned Load


consumer




to 2200 hours.


Note:




Page 279 of 302







hours.




Note:







Page 280 of 302

ANNEXURE II (C)

RELIANCE INFRASTRUCTURE LIMITED


(With Effect from 1 April, 2015)





for various classes of consumers as applicable from 1 April, 2015

General













operation











Page 281 of 302



Applicability














Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)



Applicability



following places:





applicable.


Page 282 of 302












Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)


1.27 2.03 0.56


$$

1.27 3.18 0.75

301 – 500 units 1.27 3.98 0.89

Above 500

units

(balance units)

Rs. 100 per

month$$

1.27 5.23 1.07

Note:





Page 283 of 302


Applicability










approved by MTDC.


Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

(a) 0-20 kW Rs. 250 per month 1.27 3.73 0.84

(b) > 20 kW and


per month

1.27 4.73

1.01

(c ) > 50 kW 1.27 5.98 1.22


0600 to 0900 hours 0.00

0900 to 1200 hours 0.50

1200 to 1800 hours 0.00

1800 to 2200 hours 1.00

2200 to 0600 hours -0.75

Note:


Page 284 of 302




Applicability






Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs. /kWh)

Regulatory Asset

Charge

(Rs./kWh)

0-20 kW Rs. 250 per month 1.27 4.48 0.97


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75

Note:



Page 285 of 302


Applicability






Consumption

Slab

( kWh)

Fixed/Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


month 1.27 4.23 0.93


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75


Applicability




Page 286 of 302






Consumption

Slab

( kWh)

Fixed /

Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)


month 1.27 11.73 2.19

Note






Applicability






Page 287 of 302


Consumption

Slab

( kWh)

Fixed / Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 1.27 4.23 0.93

Note






Applicability











Consumption

Slab (kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

( Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)


Page 288 of 302

Consumption

Slab (kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

( Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

LT VII (A) – All

Units

Rs. 200 per


LT VII (B) – All

Units

Rs. 200 per





Applicability







Consumption

Slab (kWh)

Fixed/Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

( Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)




Applicability




Page 289 of 302


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


month 1.27 0.73 0.34


Applicability












Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory

Asset

Charge

(Rs./kWh)



0600 to 0900

hours

0.00


Page 290 of 302

Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory

Asset

Charge

(Rs./kWh)

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75



Applicability




Voltage.


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.65 5.55 1.04


0600 to 0900 0.00


Page 291 of 302

Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

hours

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75


Applicability





multiplexes.





i.e. LT II.


Page 292 of 302


Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.65 6.30 1.17


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800

hours

0.00

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75


Applicability





Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


Page 293 of 302

Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.65 5.15 0.98


Applicability







Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


connection per

month

0.65 8.35 1.52


Applicability


Metro and Monorail.



Page 294 of 302

Consumption Slab

( kWh)

Fixed/

Demand

Charge

Wheeling

Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory

Asset Charge

(Rs./kWh)

100/33/22/11/6.6kV -

All Units

Rs. 200 per

kVA per month 0.65 5.35 1.01


Applicability












Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)


per month 0.65 5.35 1.01


0600 to 0900

hours

0.00

0900 to 1200

hours

0.50

1200 to 1800 0.00


Page 295 of 302

Consumption

Slab

( kWh)

Fixed/ Demand

Charge

Wheeling Charge

(Rs/kWh)

Energy

Charge

(Rs./kWh)

Regulatory Asset

Charge

(Rs./kWh)

hours

1800 to 2200

hours

1.00

2200 to 0600

hours

-0.75











www.rinfra.com.







on the website www.rinfra.com




Page 296 of 302

Power Factor Calculation



adopted-


)(

kVAhTotal

kWHTotal




categories)





1 0.951 to 0.954 0.95 0%

2 0.955 to 0.964 0.96 1%

3 0.965 to 0.974 0.97 2%

4 0.975 to 0.984 0.98 3%

5 0.985 to 0.994 0.99 5%

6 0.995 to 1.000 1.00 7%



Page 297 of 302


categories)





1 0.895 to 0.900 0.90 0%

2 0.885 to 0.894 0.89 2%

3 0.875 to 0.884 0.88 3%

4 0.865 to 0.874 0.87 4%

5 0.855 to 0.864 0.86 5%

6 0.845 to 0.854 0.85 6%

7 0.835 to 0.844 0.84 7%

8 0.825 to 0.834 0.83 8%

9 0.815 to 0.824 0.82 9%

10 0.805 to 0.814 0.81 10%

... ... ... ...










Page 298 of 302







annum (%)
















Factor incentive.







scheme.


Page 299 of 302



















Supply at 100 kV



kV.

Security Deposit









Page 300 of 302






























commercial bank.





Rupees Fifty.


Page 301 of 302



Definitions:

Maximum Demand





Contract Demand




considered).

Sanctioned Load


consumer




to 2200 hours.


Note:




Page 302 of 302







hours.




Note:






Documents

Order Case No 9 of 2013