True-up Petition for FY 2017-18 · True-up Petition for FY 2017-18 Assam Power Distribution Company Limited (APDCL) Page 6 BEFORE THE HON’BLE ASSAM ELECTRICITY REGULATORY COMMISSION,

True-up Petition for FY 2017-18

Submitted to

Assam Electricity Regulatory Commission

November 2018

ASSAM POWER DISTRIBUTION COMPANY LIMITED (APDCL)

BijuleeBhawan, Paltanbazar

Guwahati-781 001

ASSAM POWER DISTRIBUTION COMPANY LIMITED

BijuleeBhawan, Paltanbazar

Guwahati - 781 001

Ref: Dated:

To,

The Secretary,

Assam Electricity Regulatory Commission,

A.S.E.B. Campus, Dwarandhar,

G. S. Road, Sixth Mile,

Guwahati – 781 022

Dear Sir,

Sub: Submission of True-up Petition for FY 2017-18

In exercise of the powers conferred under Section 61 of the Electricity Act, 2003, the Hon’ble

Commission has issued the AERC (Terms and Conditions for determination of Multi Year Tariff)

Regulations, 2015for the MYT control period from FY 2016-17 to FY 2018-19.

In compliance to the aforesaid regulations, APDCL is herewith submitting the petition for

approval of true-up for FY 2017-18as per AERC (Terms and Conditions for determination of

Multi Year Tariff) Regulations, 2015for consideration and approval of the Hon’ble

Commission.The following documents are enclosed herewith for the kind perusal and approval

by the Hon’ble Commission:

1. Formal Petition, Formats and Affidavit verifying the petition along with authorization

2. Petition Fee of Rs. XX (Rupees XX only) in terms of Cheque no. …………..DatedXXdrawn on

………………………

We request the Hon’ble Commission to kindly admit the aforesaid petition and proceed further

in the matter at the earliest. We would also request the Hon’ble Commission to kindly provide

us an opportunity of personal hearing to further clarify/explain our submissions in the enclosed

petition.

Yours Faithfully,

For Assam Power Distribution Company Limited, Guwahati

(Authorized Signatory)

General Manager (Tariff Regulatory Cell)

Enclosed: As above

Table of Contents

BEFORE THE HON’BLE ASSAM ELECTRICITY REGULATORY COMMISSION, GUWAHATI ...................... 5

BEFORE THE HON’BLE ASSAM ELECTRICITY REGULATORY COMMISSION, GUWAHATI ...................... 6

NOTES AND ABBREVIATIONS ...................................................................................................................... 7

1: INTRODUCTION ................................................................................................................................... 9

ASSAM POWER DISTRIBUTION COMPANY LIMITED (APDCL) ............................................................................ 9 MULTI-YEAR TARIFF REGULATIONS, 2015 ................................................................................................... 10

2: REGULATORY REQUIREMENT OF FILING OF THE TRUE-UP PETITION ....................................... 11

REGULATIONS ............................................................................................................................................. 11 MYT TARIFF ORDER AND LAST TARIFF ORDER ............................................................................................. 12

3: METHODOLODY ADOPTED IN FILING OF THIS PETITION (INCLUDING CONSTRAINTS) ........... 13

METHODOLOGY ........................................................................................................................................... 13

4: TRUE-UP OF ARR FOR FY 2017-18 ................................................................................................... 14

CONTENTS OF THE PETITION ........................................................................................................................ 14 CATEGORY-WISE ENERGY SALES ................................................................................................................... 14 DISTRIBUTION LOSSES ................................................................................................................................. 16 ENERGY REQUIREMENT ................................................................................................................................ 19 POWER PURCHASE QUANTUM AND COST ....................................................................................................... 19 SHARING OF GAIN/(LOSS) ON ACCOUNT OF EXCESS POWER PURCHASE COST DUE TO HIGHER THAN APPROVED

DISTRIBUTION LOSSES ................................................................................................................................. 21 OPERATION & MAINTENANCE (O&M) EXPENSES ........................................................................................... 21 CAPITALISATION ......................................................................................................................................... 25 DEPRECIATION ............................................................................................................................................ 26 INTEREST & FINANCE CHARGES .................................................................................................................... 28 INTEREST ON WORKING CAPITAL .................................................................................................................. 31 INTEREST ON CONSUMER SECURITY DEPOSIT ................................................................................................. 32 OTHER DEBITS ............................................................................................................................................ 33 NET PRIOR PERIOD INCOME/EXPENSES......................................................................................................... 33 RETURN ON EQUITY ..................................................................................................................................... 34 OTHER INCOME ........................................................................................................................................... 35 NON-TARIFF INCOME ................................................................................................................................... 36 REVENUE GRANT/SUBSIDY .......................................................................................................................... 36 REVENUE FROM SALE OF POWER ................................................................................................................... 37 TRUE-UP OF ARR FOR FY 2017-18 ............................................................................................................. 37

5: PRAYER ............................................................................................................................................... 40

List of Tables

TABLE 1: ENERGY SALES FOR FY 2017-18 (MU) .............................................................................................. 15 TABLE 2: ENERGY BALANCE FOR FY 2017-18 .................................................................................................. 16 TABLE 3: TARGET VIS-À-VIS ACTUAL DISTRIBUTION LOSS OF APDCL.................................................................... 17 TABLE 4: LT: HT RATIO VIS-À-VIS ACTUAL DISTRIBUTION LOSS OF APDCL .......................................................... 18 TABLE 5: ENERGY REQUIREMENT FOR FY 2017-18 (MU) ................................................................................. 19 TABLE 6: POWER PURCHASE COST ACTUAL VIS-A-VIS APPROVED FOR FY 2017-18 .............................................. 20 TABLE 7: SHARING OF GAIN/(LOSS) ON ACCOUNT OF HIGHER DISTRIBUTION LOSSES FOR FY 2017-18 ................... 21 TABLE 8: NORMATIVE EMPLOYEE EXPENSES FOR FY 2017-18 (RS. CRORES) ....................................................... 22 TABLE 9: ROP ARREARS (RS. CRORES) ............................................................................................................. 23 TABLE 10: O&M EXPENSES FOR FY 2017-18 (RS CRORES) ............................................................................... 25 TABLE 11: CAPITAL EXPENDITURE AND CAPITALISATION FOR FY 2017-18 (RS CRORES) ...................................... 26 TABLE 12: DEPRECIATION CALCULATION FOR FY 2017-18 (RS CRORES) ............................................................ 27 TABLE 13: DEPRECIATION CLAIMED BY APDCL FOR FY 2017-18 (RS CRORES) .................................................. 27 TABLE 14: TREATMENT OF LOANS UNDER UDAY MOU CONSIDERED BY THE COMMISSION (RS CRORES) ................. 29 TABLE 15: INTEREST & FINANCE CHARGES FOR FY 2017-18 (RS CRORES) ......................................................... 29 TABLE 16: INTEREST ON GOA LOAN AND RAPDRP LOAN FOR FY 2017-18 (RS CRORES)..................................... 30 TABLE 17: REVISED CLAIM FOR INTEREST & FINANCE CHARGES FOR FY 2017-18 (RS CRORES) ............................ 31 TABLE 18: INTEREST ON WORKING CAPITAL FOR FY 2017-18 (RS CRORES)....................................................... 32 TABLE 19: ‘OTHER DEBITS’ FOR FY 2017-18 (RS CRORES) ............................................................................... 33 TABLE 20: NET PRIOR PERIOD INCOME/EXPENSE FOR FY 2017-18 (RS CRORES) ................................................. 34 TABLE 21: RETURN ON EQUITY FOR FY 2017-18 (RS CRORES) .......................................................................... 35 TABLE 22: OTHER INCOME FOR FY 2017-18 (RS CRORES) ................................................................................ 35 TABLE 23: NON-TARIFF INCOME FOR FY 2017-18 (RS CRORES) ........................................................................ 36 TABLE 24: TRUE-UP OF ARR FOR FY 2017-18 (RS CRORES) ............................................................................. 38 TABLE 25: REVENUE GAP ALONG WITH CARRYING COST FOR FY 2017-18 (RS. CRORES) ...................................... 39


Assam Power Distribution Company Limited Page 5

BEFORE THE HON’BLE ASSAM ELECTRICITY REGULATORY

COMMISSION, GUWAHATI

Filing No_______________

Case No________________

IN THE MATTER OF: Filing of the Petition for approval of true-up of ARR for FY 2017-18

AND

IN THE MATTER OF: AERC MYT Regulations, 2015

AND

IN THE MATTER OF: Assam Power Distribution Company Limited (hereinafter referred to as ‘’APDCL’’ or ‘’ the Petitioner’’ or Applicant)

I, Sri Arup Kr Baruah, son of Late Jagot Baruah, aged about 59 years, General Manager (Tariff Regulatory Cell) of the Assam Power Distribution Company Ltd, having its office at 5th Floor, Bijuli Bhawan, Paltanbazar, Guwahati, Assam, PIN-781001do solemnly affirm and say as follows:

1. I am the General Manager (Tariff Regulatory Cell) of Assam Power Distribution Company Limited, the Petitioner in the above matter and am duly authorized by the said Petitioner to make this affidavit for and on behalf of Assam Power Distribution Company Limited.

2. The statements made in the petition are based on information received from official records and I believe them to reflect truly and no material has been concealed from the statements so made or documents or supporting data etc. attached.

3. Solemnly affirm at Guwahati on 15 day of December, 2018 that the contents of this affidavit are true to my knowledge, no part of it is false or no material has been concealed therefore and misleading material included therein.

Date: 15/12/2018 General Manager (Tariff Regulatory Cell) Deponent APDCL, Guwahati


Assam Power Distribution Company Limited (APDCL) Page 6

BEFORE THE HON’BLE ASSAM ELECTRICITY REGULATORY

COMMISSION, GUWAHATI

Filing No_______________

Case No________________

IN THE MATTER OF: Filing of the Petition for approval of true-up of ARR for FY 2017-18

AND

IN THE MATTER OF: Assam Power Distribution Company Limited (hereinafter referred to as ‘’APDCL’’ or ‘’ the Petitioner’’ or Applicant)

The Applicant respectfully submits as under: -

1. The Petitioner is a deemed licensee under the provisions laid down in Section 14 Proviso 5, read with Section 131 (2) of the Electricity Act 2003

2. The Petitioner submits that the Hon’ble Commission has issued the following regulation namely, AERC (Terms and Conditions for determination of Multi Year Tariff) Regulations, 2015for the MYT control period from FY 2016-17 to FY 2018-19(hereinafter referred to as “MYT Regulations 2015”).

3. The said regulations are applicable to power generating stations, transmission system, SLDC and distribution system where tariff for generation, transmission, SLDC, retail or wheeling is not determined under section 63 of the Electricity Act 2003 through transparent process of competitive bidding in accordance with the guidelines issued by the Central Government.

4. The Petitioner is accordingly filing this petition for approval of true-up of ARR for FY 2017-18.

5. As per the MYT Regulations 2018, APDCL has filed the true-up of ARR for FY 2017-18on 30th

November 2018.

6. The Hon’ble commission during the TVS on 10th December’2018 identified defects in the petition and directs APDCL to submit the revised petition after rectifying the defects on or before 15th December’2018 vide order dated 10.12.2018.

7. Accordingly APDCL is submitting the revised petition as per direction.

Date: 15/12/2018 Petitioner

General Manager(Tariff Regulatory Cell)

APDCL, Guwahati



NOTE SAND ABBREVIATIONS

In this Petition:

Control Period is defined as Financial Year 2019-20, 2020-21 and 2021-22

hereinafter referred to as FY 20, FY 21 and FY 22

Ensuing Year is defined as Financial Year 2019-20 or FY 20

Current Year is defined as Financial Year 2018-19or FY 19

Previous Year is defined as Financial Year 2017-18 or FY 18

All currency figures used in this Petition, unless specifically stated otherwise, are

in Rs. Crores.

Abbreviation Full Description

AEGCL Assam Electricity Grid Corporation Limited

APDCL Assam Power Distribution Company Limited

APGCL Assam Power Generation Corporation Limited

AERC Assam Electricity Regulatory Commission

A&G Administrative & General

APR Annual Performance Review

ARR Aggregate Revenue Requirement

AT&C Aggregate Technical and Commercial

CAGR Compounded Annual Growth Rate

DDUGJY Deendayal Upadhyay Gram Jyoti Yojana

EA - 2003 The Electricity Act 2003

FY Financial Year

GFA Gross Fixed Assets

GoA Government of Assam

GoI Government of India

HT High Tension

HV High Voltage

HVDS High Voltage Distribution System

IPDS Integrated Power Development Scheme

LT Low Tension

MVA Mega Volt Ampere

MNRE Ministry of New & Renewable Energy



Abbreviation Full Description

MYT Multi Year Tariff

NPS National Pension Scheme

O&M Operation & Maintenance

PGCIL Power Grid Corporation of India Limited

RAPDRP Restructured Accelerated Power Development and Reforms Programme

RGGVY Rajiv Gandhi Grameen Vidyutikaran Yojana

ROP Revision of Pay

R&M Repair & Maintenance

UDAY Ujwal DISCOM Assurance Yojana



1: INTRODUCTION

Assam Power Distribution Company Limited (APDCL)

1.1 The Government of Assam, vide Memo No. PEL151/2003/Pt./165 dated

December 10, 2004, notified the restructuring of the erstwhile Assam State

Electricity Board (ASEB) into five entities, namely:

i. Assam Electricity Grid Corporation Limited (AEGCL) to carry out function

as State Transmission Utility (STU).

ii. Assam Power Generation Corporation Limited (APGCL) to carry out

function of generation of electricity in the State of Assam.

iii. Three Electricity Distribution Companies, namely Lower, Central and

Upper Assam Electricity Distribution Company Limited, to carry out

functions of distribution and retail sale of electricity in the districts

covered under each company area

1.2 All Companies are duly incorporated with the Registrar of Companies as per the

Companies Act, 1956. Further, in exercise of power under Section 172 of the

Electricity Act 2003, the Government of Assam authorized ASEB to continue its

trading functions by periodic notification till September 2009.

1.3 As per the Government of Assam Notification No. PEL.41/2006/199 dated May

13, 2009, in accordance with the Assam State Reform (Transfer and merger of

Distribution Functions and undertakings) scheme, 2009, CAEDCL and UAEDCL

Distribution Companies merged with the LAEDCL, thereby forming one

distribution company for the State. The name of the Company was changed from

LAEDCL to Assam Power Distribution Company Limited (APDCL) vide Certificate

of Incorporation dated October 23, 2009. The Government of Assam vide

Notification dated March 12, 2013 dissolved ASEB under Section 131 of the Act

with effect from March 31, 2013 and transferred ASEB’s current functions and

reassigned its personnel to its successor entities namely APDCL, AEGCL and

APGCL in accordance with the Scheme of Reorganization.

1.4 The Company is a Distribution Licensee within the meaning of Section 2 (17) of

Electricity Act 2003. Further, Section 42 and 43 of the Electricity Act 2003

prescribes the following major duties of the Distribution Licensee:

To develop and maintain an efficient, co-ordinate and economical

distribution system;



To supply electricity on an application of the consumer in accordance with

the provisions specified in the Electricity Act 2003;

To provide non-discriminatory open access to the consumers;

To establish a forum for redressal of grievances of the consumers;

Multi-Year Tariff Regulations, 2015

1.5 The Hon’ble Commission in exercise of the powers conferred under Section 61

read with Section 181(2) (zd) of the Act, has notified the Assam Electricity

Regulatory Commission (Terms and Conditions for determination of Multi Year

Tariff) Regulations, 2015 (hereinafter referred as “MYT Regulations 2015”) on

June 2’ 2015. These Regulations are applicable for determination of Tariff for

Generation, Transmission, SLDC, Wheeling and Retail Supply for the Control

Period of three financial years from April 1’ 2016to March 31’ 2019. These

regulations are applicable to all existing and future Generating Companies,

Transmission Licensees and Distribution Licensees within the State of Assam.

1.6 It is submitted that the true-up petition for FY 2017-18 is being filed in

accordance with the provisions of MYT Regulations 2015 and the provisional

accounts for FY 2017-18.



2: REGULATORY REQUIREMENT OF FILING OF THETRUE-UP

PETITION

Regulations

2.1 This petition is based on the following regulations notified by the Assam

Electricity Regulatory Commission (AERC):

Assam Electricity Regulatory Commission (Terms and Conditions for

determination of Multi Year Tariff) Regulations, 2015 - applicable for

determination of tariff in all cases covered under these Regulations from

1stApril, 2016 to 31st March 2019.

2.2 The MYT Regulations 2015 have been referred to for filing of the true-up petition

for FY 2017-18.

2.3 The Hon’ble Commission in its MYT Regulations, 2015 has directed the licensees

to file true-up of the previous year and corresponding adjustment of revenue

gap/surplus in the ensuing year. The relevant clauses of MYT Regulations 2015

are reproduced below;

‘’10.2 The Generating company, Transmission Licensee and the Distribution

Licensee shall file an application for annual performance review of current year,

true-up of previous year and tariff for the ensuing year not less than 120 days

before the close of each year of the control period..

Provided that the Generating Company or Transmission Licensee or Distribution

Licensee or SLDC, as the case may be, submit to the Commission information in

such form as may be stipulated by the Commission, together with the Accounting

Statements, extracts of books of account and such other details as the Commission

may require to assess the reasons for and extent of any variation in financial

performance from the approved forecast of Aggregate Revenue Requirement and

expected revenue from tariff and charges

Provided that the information sought by the Commission shall be submitted in the

formats as prescribed by the Commission.’’

2.4 Regulation 10 of the MYT Regulations, 2015, as amended in November

2017,specifies that the Commission shall undertake APR and True-up for the

respective years of the Control Period from FY 2016-17 to FY 2018-19, as

reproduced below:



“10.3 The scope of the annual review and True up shall be a comparison of the

actual performance of the Generating Company or Transmission Licensee or SLDC

or Distribution Licensee with the approved forecast of Aggregate Revenue

Requirement and expected revenue from tariff and charges and shall comprise the

following:

True Up: a comparison of the audited performance of the applicant for the previous

financial year with the approved forecast for the financial year and truing up of

expenses and revenue in line with Regulation 11including pass through of impact of

uncontrollable items;..’’

2.5 As per Regulation 19 of the MYT Regulations, 2015 the generating company and

the licensee shall submit the true-up of the previous year by 30th November of

each year of the control period. Accordingly, the said petition is being filed by the

licensee.

MYT Tariff Order and Last Tariff Order

2.6 The Commission had issued the Business Plan Order for the control period from

FY 2016-17 to FY 2018-19 on September 1’ 2016. The MYT order for the same

was issued on March 31’ 2017. In the MYT order, the Commission had approved

the ARR for FY 2017-18. Subsequently, in the latest tariff order dated March 19’

2018, the Commission had carried out the Annual Performance Review (APR) for

FY 2017-18.

2.7 The true-up of ARR for FY 2017-18 is being submitted by comparing the actual

performance for FY 2017-18 with the values as approved in the MYT order dated

March 31’ 2017.



3: METHODOLODYADOPTED IN FILING OF THIS PETITION

(INCLUDING CONSTRAINTS)

Methodology

3.1 APDCL is submitting the true-up of ARR for FY 2017-18 based on the available

provisional accounts. It consists of details of actual expenditures incurred and

details of revenue leading to actual revenue gap/surplus for the period from

April 2017 to March 2018. The Petitioner has proposed the true-up of ARR for FY

2017-18 as per the provisions of the MYT Regulations 2015. The present true-up

of ARR for FY 2017-18 is being filed based on the provisional accounts and the

data as available with APDCL. The same would be adjusted/revised based on the

audited accounts, if made available during the course of scrutiny of the petition

or as and when available.

3.2 The true-up of ARR for FY 2017-18 is being submitted by comparing actual

performance (based on accounts) with the values as approved in the MYT order

dated March 31’ 2017.

3.3 The Petitioner humbly requests the Hon’ble Commission to approve the true-up

of ARR for FY 2017-18 as submitted.



4: TRUE-UP OF ARR FOR FY 2017-18

Contents of the Petition

4.1 This petition has in detail, the true-up of ARR for FY 2017-18. The following

section explains in detail the key elements of determination of ARR and thereby

the revenue gap/(surplus) of the utility.

4.2 Determination of Aggregate Revenue Requirement by validating the actual

figures taken from the audited accounts of the following costs, other income &

returns:

i. Power Purchase Cost

ii. Operation& Maintenance Cost

iii. Depreciation

iv. Interest & Finance Charges

v. Interest on Working Capital

vi. Interest on Consumer Security Deposits

vii. Other Debits

viii. Net Prior Period Expenses/(Credit)

ix. Return on Equity

x. Other Income

xi. Non-Tariff Income

4.3 The revenue includes revenue from sale of power and revenue grant/subsidy

figures to arrive at the revenue gap/ (surplus) for the utility.

Category-wise Energy Sales

4.4 The Commission had approved energy sales of 7107 MU in the APR for FY 2017-

18 in the tariff order dated March 19’ 2018. Against approved energy sales of

7107 MU, actual sale is 6814MU. The actual category-wise energy sales vis-à-vis

earlier approved energy sales is as depicted in the table below.



Table 1: Energy Sales for FY 2017-18 (MU)

Particulars FY 2017-18

MYT Order

Submitted in APR

Approved in APR

True-up % inc

(+)/dec (-) JEEVAN DHARA 565 465 610 669 18.38% DOMESTIC A Total 3134 2893 2889 2727 -13.00% Domestic-B above 5 kw to 20kw 288 284 291 277 -3.92% Commercial Load above 0.5 to 20kw 693 684 690 627 -9.52% General Load upto 20 kw 136 120 121 99 -27.29% Public Lighting 23 16 17 13 -44.70% Agriculture upto 7.5 HP 17 22 18 20 16.06% Small Industries Rural upto 20kw 61 71 71 66 7.82% Small Industries Urban 32 32 35 30 -4.94% Temporary 6 6 8 7 22.00% LT TOTAL 4955 4592 4750 4534 -8.49% HT Domestic 20kw and above 46 32 36 31 -32.72% HT Commercial 20kw & above 395 398 426 352 -10.89% Public Water Works 71 83 95 71 -0.06% Bulk Supply Govt. Edu Inst 94 88 95 76 -19.35% Bulk Supply Others 414 439 410 383 -7.42% HT Small Industries upto 50 kw 23 29 27 23 1.48% HT Industries-I 50kw to 150 kw 88 90 82 67 -24.23% HT Industries-II above 150 kw 793 673 617 702 -11.51% Tea Coffee & Rubber 442 554 437 484 9.53% Oil & Coal 182 94 112 76 -58.37% HT Irrigation Load above 7.5 HP 22 25 21 15 -31.86% HT TOTAL 2570 2506 2358 2280 -11.30% TOTAL Energy Sales (excluding OA consumption)

7524 7098 7107 6814 -9.44%

4.5 The actual sale has shown a decline of ~9.44% vis-à-vis approved energy sales as

per the MYT order. It is to be noted that actual energy sales for FY 2017-18 are

more than the actual energy sales for FY 2016-17, both for the LT and HT

category. The Commission had approved actual energy sales of 6526 MU during

true-up of FY 2016-17. LT sales for FY 2017-18 has shown an increase of ~6.16%

over LT sales for FY 2016-17 and HT sales for FY 2017-18 has shown an increase

of ~1.09% over LT sales for FY 2016-17. Overall, sales of FY 2017-18 are more

than the actual energy sales for FY 2016-17 by ~4.41%.

4.6 It is to be noted that the sales to the Jeevan Dhara category have shown an

increase of 18.38% over the MYT approved energy sales, primarily due to the

implementation of the Saubhagya scheme. Further, the energy sales of the cross-

subsidising categories particularly HT-I, HT-II and Oil & Coal have shown a

decline over the approved MYT energy sales, thereby impacting the revenue

realisation of the utility.

4.7 It is observed that the LT sales have shown a higher increase compared to the



increase in the HT sales over FY 2016-17 sales. Primary reason for this is the

massive rural electrification being undertaken through various ongoing flagship

programs like RGGVY/DDUGJY and Saubhagya scheme of Govt. of India. Such

programs have led to manifold increase in domestic consumers in a small span of

time. Further, the supply hours to rural areas have also increased in the last few

years owing to greater availability of power and the vision of moving towards

24x7 power for all. This has resulted in increased sales for LT categories

especially for the Jeevan Dhara and small domestic consumers. Massive rural

electrification and availing of power through open access route by some HT

consumers in the recent years has resulted in inverse HT: LT ratio against the

commercial proposition of APDCL. This reversal of trend and corresponding

trend of distribution losses is discussed subsequently under the head of

‘Distribution Losses’.

4.8 The Petitioner requests the Hon’ble Commission to approve actual retail

energy sales of 6814 MU (excluding OA consumption) for true-up of ARR

for FY 2017-18 since it is uncontrollable.

Distribution Losses

4.9 The Commission in the business plan order dated September 1’ 2016 had

approved distribution loss of 17.35%, 17.10% and 16.85% for FY 2016-17, FY

2017-18 and FY 2018-19 respectively. The Commission during APR of FY 2017-

18 vide tariff order dated March 19’ 2018 had maintained the same approved

distribution loss target of 17.10%.

4.10 The Petitioner during FY 2017-18 has achieved actual distribution loss of

17.64% against the target of 17.10% even with various constraints i.e. adverse

HT: LT Ratio, incremental sale to LT consumers, old infrastructure etc.The actual

distribution loss for FY 2017-18 has been arrived at by considering the actual

quantum of power purchase, losses in inter-state and intra-state transmission

and actual sales to the consumers of the utility. The energy balance for FY 2017-

18 is as shown below.

Table 2: Energy Balance for FY 2017-18

S. No. Sources FY 2017-18

1 Input from Central Sector Generators (MU) 6138.12

2 Input from APGCL (MU) 1423.25

3 Input from DLF (IPP) (MU) 0.00

4 Input from MeECL (MU) 0.55

5 Input from NCE Sources (MU) 61.84

6 Input from IOCL(AOD) (MU) 0.00

7 Input from UI Pool (MU) 350.92



S. No. Sources FY 2017-18

8 Input from Trader + IEX (MU) 1389.85

9 Total Power Purchase (MU) 9364.54

10 PGCIL Loss (MU) 121.86

11 Loss in PGCIL% (11= 10/(1+8)) 1.62%

12 Energy Available for Sale (MU) 9242.68

13 Trading Sale/Export under PSA (MU) 670.58

14 Energy Available for Sale to discoms (MU) (14 = 12 -13) 8572.10

15 Tr Loss of AEGCL (%) 3.49%

16 Energy available to DISCOM (MU) 8272.93

17 Distribution Loss (MU) (17 = 16 – 19) 1459.13

18 Distribution Loss (%)(18 = 17/16) 17.64%

19 Energy Sold(MU) 6813.81

4.11 The past years actual distribution loss of APDCL against the target approved by

the Commission is shown in the following table:

Table 3: Target vis-à-vis actual distribution loss of APDCL

Year Approved Loss (%) Actual Loss Level (%)

2005-06 29.95 31.10

2006-07 30.71 29.43

2007-08 25.05 27.32

2008-09 24.24 24.32

2009-10 22.60 26.06

2010-11 21.60 25.44

2011-12 20.60 26.61

2012-13 19.60 25.85

2013-14 18.60 24.11

2014-15 18.60 21.14

2015-16 17.60 18.12

2016-17 17.35 17.89

2017-18 17.10 17.64

4.12 It is seen that over the years the utility has been able to bring down the losses

gradually. It is pertinent to mention that with specific programs like DSM

initiatives, creation of dedicated cells to monitor high value consumers etc.

APDCL has been able to bring down the loss level significantly even with

restricted resources. The Petitioner, humbly submits that despite the best efforts

of the utility to achieve the target distribution losses, it is getting much more

difficult to reduce the distribution losses now at the same rate as achieved in the

past years.The HT: LT ratio is getting adverse every year as LT sales are

increasing on account of extensive rural electrification and HT sales are not

increasing at the same rate as it is impacted due to other factors like lack of

industrial growth in the state, etc.



4.13 Year on year sales mix of APDCL and corresponding distribution losses of APDCL

are as depicted below:

Table 4: LT: HT ratio vis-à-vis actual distribution loss of APDCL

4.14 It is understood that HT: LT ratio has a key impact on overall distribution losses

of the state and with the present trend of inverse HT: LT ratio, there is a need to

revisit the distribution loss target. Losses increase with increase in LT

consumption at the same performance levels. APDCL requests the Hon’ble

Commission to review the T&D loss targets based on the actual achievements

and the above concerns, while executing the truing-up exercise.

4.15 The distribution loss scenario of APDCL is also to be seen from the aspect of

overall situation prevailing in some parts of the state. It may be seen that in

predominantly urban areas as well as areas without any social disturbances, the

utility was able to achieve distribution loss far below the approved loss levels.

However, in some areas where the situation is beyond reasonable control of the

licensee, the losses have crossed the approved limit. Further, consumer

behaviour ofcertain areas under APDCL is at variance from others. Frequent

bandh as well as perennial natural calamities in some part of the State affects the

performance in these areas resulting in higher losses.

4.16 Considering the past actually achieved distribution loss levels, increase in

consumption of LT sales and deferred implementation of various schemes

as per the approved capital investment plan, the Petitioner requests the

Hon’ble Commission to approve actual distribution loss of 17.64% for FY

2017-18.

4.17 Any deviation in the distribution losses vis-à-vis the approved losses directly

affects thepower purchase requirement of the licensee. If the losses are higher,

FY LT Sales (MU) (%)

HT Sales (MU) (%)

Distribution Loss (%)

2008-09 1489(49%) 1555(51%) 24.32

2009-10 1573(48%) 1674(52%) 26.06

2010-11 1769(50%) 1767(50%) 25.44

2011-12 2026(51%) 1944(49%) 26.61

2012-13 2176(52%) 2029(48%) 25.85

2013-14 2593(54%) 2170(46%) 24.11

2014-15 3228(59%) 2257(41%) 21.14

2015-16 3886(63%) 2313(37%) 18.12

2016-17 4270(65%) 2256(35%) 17.89

2017-18 4534 (67%) 2280 (33%) 17.64



the power purchase requirements would go up resulting in a loss to the licensee

or if the losses are lower, the power purchase requirements would go down

resulting in saving in the power purchase costs thus resulting in gain.

4.18 Further, considering the age of assets vis-à-vis restricted R&M allowance as

per the regulations, the Hon’ble Commission is requested to consider the

actual distribution loss of 17.64% in the true-up of ARR for FY 2017-18.

Energy Requirement

4.19 Based on actual sales, actual distribution losses and inter-state and intra-state

transmission losses, the actual energy requirement for the year is as below.

Table 5: Energy Requirement for FY 2017-18(MU)


MYT Order Submitted

in APR Approved

in APR True-up

Energy Sales (MU) 7524 7098 7107 6,814 Distribution Loss (%) 17.10% 17.10% 17.10% 17.64% Energy Requirement at Distribution Periphery T-D (MU)

9,076 8,562 8,574 8,273

Intra-State Transmission Loss (%) 3.49% 3.49% 3.49% 3.49% Energy input to Transmission System (MU)

9,404 8,871 8,884 8,572

Inter-State (PGCIL) Pooled Loss (MU) 139 114 114 122 Total Energy Requirement (MU) * 9,544 8,985 8,998 8,694

Note: * - Excluding trading sales quantum of 670.58 MU

Power Purchase Quantum and Cost

4.20 Power procurement of APDCL is largely dependent on the state generating

stations of APGCL and central generating stations to meet its base load. However,

in order to meet the peak demand of the state, APDCL ties up with the short-term

sources like traders and also sources power from Power Exchanges.

4.21 During FY 2017-18, APDCL incurred expenditure of Rs. 4506.31 Crores for

purchase of 9364.54 MU as against the approved cost of Rs. 4376.30 Crores for

9543.76 MU as approved in the MYT order for FY 2017-18.

4.22 This increase in power purchase cost can be mainly attributed to the following

factors:

Increase in the total quantum of power sourced from allocated sources

with compulsion as compared to the approved quantum at higher rate



Even with additional power from allocated sources, APDCL has to procure

power from additional sources i.e. through bilateral trading, energy

exchange etc. To mitigate gradually increasing demand particularly in peak

hours

4.23 The total power purchase cost for the company for FY2017-18 comprises of the

basic power purchase cost, transmission charges payable to AEGCL (inclusive of

PGCIL charge & special charge on BST). Based on the same, the comparison of the

power purchase is as shown in the table below.

Table 6: Power Purchase Cost actual vis-a-vis approved for FY 2017-18

Quantum

(MU)

Cost

(Rs Crore)

Average

rate

(Rs/kwh)

Quantum

(MU)

Cost

(Rs Crore)

Average

rate

(Rs/kwh)

Quantu

m (MU)

Cost

(Rs Crore)

Average

rate

(Rs/kwh)

APGCL 2209.03 582.63 2.64 1423.25 415.07 2.92 -785.78 -167.56 0.28

CSGS NER

Kopili HEP 350.0 39.55 1.13 550.89 57.71 1.05 200.89 18.16 -0.08

Kopili HEP - II 50.0 8.15 1.63 57.60 7.70 1.34 7.60 -0.45 -0.29

Khandong HEP 95.0 16.72 1.76 141.73 22.60 1.59 46.73 5.88 -0.17

RHEP 560.0 113.68 2.03 600.51 174.43 2.90 40.51 60.75 0.87

DHEP 70.0 30.59 4.37 113.64 54.72 4.82 43.64 24.13 0.45

AGBPP 930.0 325.50 3.50 824.96 280.64 3.40 -105.04 -44.86 -0.10

AGTPP+AGTPP2 345.0 106.73 3.09 267.53 98.62 3.69 -77.47 -8.11 0.59

NHPC 150.0 42.45 2.83 238.31 63.91 2.68 88.31 21.46 -0.15

OTPC 1100.0 314.60 2.86 1269.32 384.08 3.03 169.32 69.48 0.17

NTPC, BTPS* 1576.7 900.28 5.71 1007.75 645.45 6.40 -568.92 -254.83 0.69

CSGS NER GROSS 5284.67 1918.55 3.63 5072.23 1789.86 3.53 -212.44 -128.69 -0.10

CSGS ER

Farakka 250.00 83.25 3.33 222.62 79.26 3.56 -27.38 -3.99 0.23

Kahalgaon I 130.00 46.28 3.56 115.02 42.28 3.68 -14.98 -4.00 0.12

Kahalgaon II 540.00 211.14 3.91 550.90 194.92 3.54 10.90 -16.22 -0.37

Talcher 140.00 37.52 2.68 141.73 39.01 2.75 1.73 1.49 0.07

CSGS ER GROSS 1060.0 378.19 3.57 1030.3 355.48 3.45 -29.73 -22.71 -0.12

OTHERS

HHPCPL 9.80 4.03 4.11 8.55 3.51 4.11 -1.25 -0.52 0.00

IOCL(AOD) 27.20 10.53 3.87 -27.20 -10.53 -3.87

MeECL 28.60 17.13 5.99 0.55 0.40 7.30 -28.05 -16.73 1.31

SECI Solar 31.00 18.68 6.03 39.17 24.41 6.23 8.17 5.73 0.21

JNNSM Solar Bundled 9.60 11.12 11.58 7.97 9.83 12.33 -1.63 -1.29 0.75

Suryatap Solar* 0.56 0.54 9.64 6.15 5.45 8.86 5.59 4.91 -0.78

Pohmura SHEP* 0.47 0.14 2.98 #DIV/0! -0.47 -0.14

JNNSM Coal Bundled 35.00 10.96 3.13 35.62 11.48 3.22 0.62 0.52 0.09

TRADING PURCHASE 261.18 60.07 2.30 632.09 250.34 3.96 370.91 190.27 1.66

IEX IN 586.65 134.93 2.30 757.76 317.40 4.19 171.11 182.47 1.89

Additional Solar RPO (RECs) 20.71 #DIV/0! 3.88 #DIV/0! -16.83

Additional Non-solar RPO(RECs) 15.70 #DIV/0! 18.16 #DIV/0! 2.46

OTHERS GROSS 990.06 304.54 3.08 1487.86 644.88 4.33 497.80 340.34 1.26

Deviation Settlement Mechanism 350.92 93.93 2.68 350.92 93.93 2.68

TOTAL BUY 9543.8 3183.91 3.34 9364.5 3299.22 3.52 -179.22 115.31 0.19

Transmission Charges 1192.39 1.25 1207.09 1.29 14.70 0.04

Total Power Purchase Cost 9543.8 4376.30 4.59 9364.54 4506.31 4.81 -179.22 130.01 0.23

Approved (MYT) Actual Deviation

Agency/Source

4.24 The power purchase cost of the utility (on gross basis) for FY 2017-18 is Rs.

4506.31 Crores. The rebate on timely payment of power purchase of Rs. 10.07



Crores has been considered under the head of ‘Other Income’ and has been

adjusted there.

4.25 The Petitioner, humbly requests the Hon’ble Commission to approve the

actual power purchase cost of the utility during true-up of ARR for FY 2017-

18.

Sharing of gain/(loss)on account of excess power purchase cost due to higher

than approved Distribution Losses

4.26 As the actual distribution losses are higher than the approved distribution losses

for FY 2017-18, the efficiency loss on account of higher than approved

distribution losses, in terms of excess power purchase expenses, have been

shared between APDCL and the consumers, as shown in the table below.

Table 7: Sharing of gain/(loss) on account of higher distribution losses for FY 2017-18

Particulars Unit FY 2017-18

Total Power Purchase including trading sales MU 9365

Allowable Energy Purchase for sale within

State MU 9309

Excess Energy Purchase MU 56

Average power purchase rate Rs/kWh 3.52

Excess Power Purchase Cost Rs. Crores (19.68)

Share of gain/(loss) to be borne by APDCL Rs. Crores (13.12)

Share of gain/(loss) to be borne by consumers Rs. Crores (6.56)

4.27 Therefore, the loss of Rs. 13.12 Crores has been considered to be borne by the

Petitioner in accordance with the MYT Regulations 2015.

Operation & Maintenance (O&M) Expenses

4.28 The Operation and Maintenance (O&M) Expenses comprise of the following

elements:

Employee Expenses

Repair and Maintenance (R&M) Expenses

Administrative and General (A&G) Expenses

4.29 Each of the expense heads are discussed herein below.



Employee Cost

4.30 Employee expenses comprise of salaries, dearness allowance, bonus, terminal

benefits in the form of contribution for pension and gratuity funding, leave

encashment, and staff welfare expenses.

4.31 It is to be noted that the Commission had provisionally considered Rs. 28.88

Crores towards Revision of Pay (ROP) during APR of FY 2017-18. This was

considered over and above the normative employee expenses of Rs. 694.69

Crores for FY 2017-18. The Revision of Pay (ROP) 16 is applicable from January

2016; the implementation of ROP 16 in APDCL took place in December 2017,

consequently, the impact of ROP 16 was affected in the salaries for the period

January to March 2018. The remaining pending arrears due on account of ROP

16 will be paid along with the salaries for FY 2018-19.

4.32 In this regard, it is submitted that the amount shown under the head of

‘Employee Benefit Expenses’ in the books of accounts is Rs. 742.06 Crores

pertaining to the period FY 2017-18. The provision against ROP duesas

considered in the books of accounts is Rs. 122.67 Crores. The pending arrears on

account of ROP will be paid during FY 2018-19. The provision of Rs. 122.67

Crores has been made against ROP dues.

4.33 The normative calculation of employee expenses for FY 2017-18 is as below.

Table 8: Normative employee expenses for FY 2017-18 (Rs. Crores)


MYT Order

Submitted in APR

Approved in APR

True-up Deviation

Employee Expenses for Previous Year 640.20 640.20 Growth Factor 3% 3% CPI Inflation 5.35% 3.08% Employee Expenses 728.12 777.96 694.69 679.72 Add: Revision of Pay Impact (ROP 16) 28.88 122.67 Total Employee Expenses 728.12 777.96 723.57 802.39 74.27

4.34 The Petitioner requests the Hon’ble Commission to approve normative employee

expenses of Rs. 802.39 Crores for true-up of ARR for FY 2017-18, including the

impact of ROP of Rs. 122.67 Crores.

4.35 The detailed calculation of the ROP arrears of Rs. 122.67 Crores is as below.



Table 9: ROP arrears (Rs. Crores)

ParticularsPay

Liability

NPS

Employer

Contributi

on

Pension

Contributio

n Liability

Total ParticularsPay

Liability

NPS

Employer

Contributi

on

Pension

Contribut

ion

Liability

TotalGrand

Total

Already

releasedBalance

Apr-16 6.27 0.20 0.98 7.46 Apr-17 5.71 0.22 0.82 6.74

May-16 6.22 0.20 0.97 7.40 May-17 5.67 0.22 0.81 6.70

Jun-16 6.19 0.21 0.96 7.36 Jun-17 5.62 0.22 0.80 6.63

Jul-16 6.17 0.21 0.96 7.33 Jul-17 6.17 0.24 0.87 7.28

Aug-16 6.14 0.21 0.95 7.29 Aug-17 6.12 0.24 0.86 7.23

Sep-16 6.10 0.21 0.94 7.25 Sep-17 6.08 0.24 0.85 7.18

Oct-16 5.89 0.20 0.91 7.00 Oct-17 6.02 0.24 0.84 7.10

Nov-16 6.02 0.21 0.92 7.14 Nov-17 6.45 0.29 0.84 7.57

Dec-16 6.03 0.21 0.91 7.15 Dec-17 -

Jan-17 6.03 0.22 0.90 7.14 Jan-18 -

Feb-17 5.83 0.22 0.85 6.90 Feb-18 -

Mar-17 5.78 0.22 0.84 6.84 Mar-18 -

TOTAL 72.67 2.51 11.08 86.26 TOTAL 47.82 1.91 6.70 56.43

142.69 20.20 122.49

4.36 The Petitioner requests the Commission to consider the effect of ROP while

approving normative employee expenses for FY 2018-19 and for the control

periodfrom FY 2019-20 to FY 2021-22.

4.37 The Petitioner requests the Hon’ble Commission to allow normative employee

expenses of Rs. 802.39 Crores for FY 2017-18. The Petitioner requests the

Commission to allow normative employee expenses for FY 2017-18.

R&M Expenses

4.38 R&M Expenses are incurred for daily upkeep of the distribution network and

forms an integral part of the company's efforts towards reliable and quality

power supply.

4.39 R&M Expenses are dependent on various factors. It is to be submitted that most

of its assets are old and not adequately maintained from time to time primarily

due to restricted allowance in tariff for many previous years. Regular

maintenance of assets is prerequisite to ensure uninterrupted operations. APDCL

has been trying its best to ensure uninterrupted operations of the system and

accordingly has been undertaking necessary expenditure for R&M activities.

Considering this fact, the expenditure incurred on R&M activities are

uncontrollable in nature.

4.40 Against approved cost of Rs. 103.21 Crores on normative basis during the MYT

order, the actual expenditure incurred is Rs. 124.26 Crores.

4.41 Such deviation is mainly due to the following factors:

Restricted approval for R&M merely on the basis of regulation irrespective

of the age vis- à-vis health of infrastructure for many previous years



Outsourcing for operation & maintenance of many sub-stations due to

severe human resource constraints

4.42 The Petitioner requests the Commission to allow actual R&M expenses of Rs.

124.26 Crores for FY 2017-18 and not consider approval based on normative

approach linked to K factor and WPI index as it does not adequately cover the

actual expense incurred on R&M of assets, considering the age of assets. The

ageing infrastructure of the utility necessitates higher R&M expenditure for

maintaining system operations and thereby are uncontrollable in nature.

Considering the above, the actual R&M expenses should be allowed in entirety.

A&G Expenses

4.43 A&G Expenses mainly comprise of rents, taxes, various statutory charges,

telephone and other communication expenses, professional charges, legal

charges, conveyance & travelling allowance etc.

4.44 The Commission had approved A&G expenses of Rs. 38.82 Crores for FY 2017-18

on normative basis in the MYT order. Actual A&G expenses are Rs. 44.72 Crores,

as per statement of accounts for FY 2017-18.

4.45 It is to be noted that actual A&G expenses depend on the growth in the business

size requiring higher operational activity thereby resulting in higher expenses in

addition to the inflation factor. Further, the increase is also due to uncontrollable

reasons like increase in telephone charges, water charges and increase in other

statutory taxes etc. vis-à-vis the lump-sum amount approved as per the

regulations on normative basis.

4.46 Considering the above, the Petitioner requests the Commission to allow actual

A&G expenses of Rs. 44.72 Crores for FY 2017-18.

4.47 Further, the Petitioner requests the Commission to allow actual A&G expenses

for FY 2017-18 and not consider approval based on normative approach linked

to WPI index as it does not adequately cover the actual expenditure under the

head of A&G expenses.

Total O&M Expenses for FY 2017-18

4.48 The summary of the total O&M expenses being claimed as part of the true-up of

ARR for FY 2017-18 vis-à-vis approved earlier is as below.



Table 10: O&M Expenses for FY 2017-18(Rs Crores)

Particulars (in Rs. Crores) FY 2017-18

MYT Order

Submitted in APR

Approved in APR

True-up Deviation

Employee Expenses 728.12 777.96 723.57 802.39 74.27 R&M Expenses 103.21 109.35 109.41 124.26 21.05 A&G Expenses 38.82 59.96 35.19 44.72 5.90 Total O&M Expenses 870.15 947.27 868.17 971.37 101.22

4.49 It is submitted that the total O&M Expenses amounting to Rs. 971.37 Crores

be allowed by the Hon’ble Commission in the true-up of ARR for FY 2017-

18.

Capitalisation

4.50 The Petitioner submits that the actual capitalisation achieved during the year is

Rs. 211.46 Crores. The net addition to the GFA for the purpose of computing the

depreciation is Rs. 20.18 Crores, while Rs. 186.25 Crores is towards assets not

belonging to APDCL, and Rs. 5.03 Crores is funded by Consumer Contribution.

The Commission had approved capitalisation of Rs. 1041.35 Crores in the APR of

FY 2017-18. The reasons for low capitalisation achieved during FY 2017-18 are

as:

Delay in receipt of funds for various schemes

Deferred implementation of various schemes as per the last business plan

order

Delay in approval of schemes

Further, most of the schemes are being implemented in packages (e.g. RGGVY/12th Plan package A/B/C etc.).The capitalization is done only after completion of the entire package

4.51 The Petitioner requests the Hon’ble Commission to approve actual capitalisation

of Rs. 211.46 Crores during true-up of ARR for FY 2017-18.

4.52 The capital expenditure and CWIP summary for FY 2017-18 is as shown below.



Table 11: Capital expenditure and capitalisation for FY 2017-18 (Rs Crores)


MYT Order

Submitted in APR

Approved in APR

True-up

Opening CWIP 3812.96 2897.86 3,456.98 2,897.86 Capital Expenditure 1,000.00 1789.65 1,789.65 735.32 Capitalisation 650.00 2227.09 1,041.35 211.46 Closing CWIP 4162.96 2460.42 4,205.28 3,421.72

4.53 The Petitioner requests the Hon’ble Commission to approve the above said

capitalisation for FY 2017-18.

Depreciation

4.54 As per Regulation 33.2 of the MYT Regulations, 2015, the total depreciation

during the life of the asset shall not exceed 90% of the original cost of GFA.

Commission has computed the depreciation separately for assets added under

each asset head for the year. The Commission has disallowed the depreciation on

assets where depreciation is in excess of 90% of the original cost of asset under

different asset heads. The Commission did not consider depreciation on assets

funded through grants in accordance with Regulation 31 and 33 of MYT

Regulations, 2015. The Commission considered the conversion of loan to grant

under the UDAY Scheme during APR of FY 2017-18.

4.55 For computation of depreciation, the Commission considered the approved

closing GFA for FY 2016-17 as the opening GFA for FY 2017-18. The

capitalization approved for the year was considered as asset addition during the

year. The Commission considered the scheduled depreciation rates as specified

in MYT Regulations, 2015. Accordingly, the Commission approved Rs. 18.47

Crores on account of depreciation during APR for FY 2017-18.

4.56 Opening Gross Block of Fixed Assets for FY 2017-18 as per the statement of

accounts is Rs. 3612.16 Crores, out of which assets not belonging to the company

are Rs. 1424.35 Crores and assets created out of consumer contribution are Rs.

223.44 Crores. Depreciation has been calculated taking into consideration the

opening as well as addition of assets during FY 2017-18 as per statement of

accounts. While actual depreciation as per Companies Act is shown in the

statement of account, truing-up claim has been made after recalculating the same

as per AERC Regulations and is shown in the table below.



Table 12: Depreciation calculation for FY 2017-18(Rs Crores)

ParticularsAs on

01.04.17

Net

addition

during the

year

Rate of DepAccumulated as

on 01.04.17

Assets fully

depreciatedOn OB

On

AdditionTotal

Land & Rights

i) Land owned under full title 15.61 - - - - -

ii) Leasehold land 2.22 - 3.34% 0.07 0.07 - 0.07

Sub total: 17.83 - 0.07 - 0.07 - 0.07

Building 53.86 1.21 3.34% 22.28 - 1.80 0.02 1.82

Hydraulic - - -

Other Civil Works 54.39 0.25 3.34% 24.90 - 1.82 0.00 1.82

Plant & Machinery 589.64 7.41 5.28% 352.61 214.60 19.80 0.20 20.00

Lines & Cable Network 1,194.58 9.07 5.28% 610.38 388.81 42.54 0.24 42.78

Vehicles 11.94 - 5.28% 10.55 11.23 0.04 - 0.04

Furniture & Fixtures 15.83 0.78 6.33% 10.53 9.20 0.42 0.02 0.44

Office Equipment 26.30 1.46 6.33% 19.41 16.80 0.60 0.05 0.65

SUB TOTAL 1,964.36 20.18 3.44% 1,050.73 640.64 67.10 0.53 67.63 Ad d : Consumers contribution deducted from

service connection under O.H.lines & cable

network

223.44 5.03 5.28% 91.68 11.80 0.13 11.93

Ad d : Assets not belonging to the entity 1,424.35 186.25 - - -

3,612.16 211.46 1,142.41 640.64 78.89 0.66 79.56

(All amount in Rs. Crores) Depreciation

Table 13: Depreciation claimed by APDCL for FY 2017-18(Rs Crores)

Grant for assets

not belonging

to entity

(RGGVY, MNRE

etc.)

Co

nsu

me

r

Co

ntr

ibu

tio

nTotal

As on

01.04.2005

As on

01.04.2017Sub total

Grants Available - 1,911.09 1,911.09 3,211.21 223.44 5,345.73

GFA (excluding Consumer Contribution and assets

not belonging to company)1,095.63 868.73 1,964.36 1,424.35 223.44 3,612.16

CWIP - 2,897.86 2,897.86 106.21 3,004.07

Total 1,095.63 3,766.59 4,862.22 1,530.56 223.44 6,616.22

Cumulative grants apportioned in the ratio of GFA

and CWIP

GFA - 440.78 440.78 2,988.38 3,429.15

CWIP - 1,470.31 1,470.31 222.83 1,693.14

Total - 1,911.09 1,911.09 3,211.21 - 5,122.30

Depreciation calculated as per the Regulation on

the GFA 37.72 29.91 67.63 - 67.63

Weighted Average Rate of Depreciation (%) 3.44% 3.44% 3.44% -

Depreciation to be deducted on the assets built on

the grants component on 90% asset value - 15.17 15.17 - 15.17

Depreciation claimed 37.72 14.73 52.45 - - 52.45

State Govt. grant

As on 01.04.2017

Particulars

4.57 The depreciation amount claimed works out to Rs. 52.45 Crores as shown above.

It is to be noted that the conversion of loan to grant as per the UDAY scheme did

not materialise during FY 2017-18 and the effect of the same has not been



considered.

4.58 In regard to the above claim, the following points are detailed below:

Rates of depreciation as notified in addendum to MYT Regulations 2015

are considered

As depreciation on assets created out of consumer contribution was not

charged in Profit and Loss account, the same has also not been considered

for claim

No funding from grant for Fixed Assets vis-à-vis CWIP transferred to

APDCL consequent to unbundling of erstwhile ASEB as on 1st April, 2005.

As such, total depreciation on the opening balance of GFA as on transfer

scheme 1st April, 2005 amounting to Rs. 37.72 Crores calculated at the

weighted average rate of 3.44% is claimed in totality

Depreciation on subsequent assets is claimed after apportionment of

available grant. Total amount of depreciation claimed on this account is Rs.

14.73Crores after adjustment of funding from grant for Rs. 15.17 Crores.

4.59 As no depreciation has been charged on assets created out of RGGVY, MNRE as

well as consumer contribution, grant received against such schemes are shown

separately with no claim of depreciation.

4.60 Thus, depreciation of Rs. 52.45 Crores be considered by the Hon’ble Commission

in the true-up of ARR for FY 2017-18.

Interest & Finance Charges

4.61 The Commission has approved interest on loan capital for the year on normative

basis in its previous tariff orders. The normative closing loan of Rs. 432.80

Crores for FY 2016-17 as approved in the true-up of FY 2016-17 was considered

as the normative loan outstanding as on April 1, 2017 during APR of FY 2017-18.

4.62 The Commission considered the amount of loan converted under UDAY to grant

equivalent to the net normative loan outstanding as on April 1, 2016, i.e., Rs.

343.06 Crores, as the net normative loan outstanding was lower than the amount

of loan converted to Grant by the GoA. Further, as the entire net normative loan

outstanding had been converted to grants, the Commission did not consider any

conversion of loan to equity during APR of FY 2017-18.

4.63 The treatment of loans under the UDAY MoU as considered by the Commission is



reproduced below:

Table 14: Treatment of Loans under UDAY MoU considered by the Commission (Rs Crores)

4.64 Accordingly, the Commission had considered the net addition of loan during FY

2017-18 as the sum of loan of Rs. 79.12 Crores taken for funding the

capitalization during FY 2017-18 and the reduction of loan of Rs. 343.06 Crores

due to conversion to grant. Thus, the Commission had considered a net reduction

of loan of Rs. 263.95Crores in FY 2017-18. Further, the loan repayment was

considered equivalent to depreciation approved. The Commission had

considered the interest rate of 9.40% for the balance loan amount as proposed

by APDCL in accordance with the UDAY MoU. Accordingly, the Commission had

approved interest charges of Rs. 27.41 Crores and finance charges of Rs. 3.78

Crores, thereby allowing Rs. 31.19 Crores as interest & finance charges during

APR of FY 2017-18.

4.65 In this context, it is to be submitted that the UDAY MoU was executed on 4th

January, 2017 and conversion of govt. loan requires going through process up to

the level of Cabinet approval, the same didn’t materialize during FY 2017-18. As

such, the benefit of reduction in interest on Govt. Loan consequent to conversion

as envisaged couldn’t be availed during FY 2017-18 and actual debt structure has

prevailed till the end of FY 2017-18.

4.66 Actual interest and finance charges booked vis-à-vis approved during FY 2017-

18 is presented in the table below:

Table 15: Interest & Finance Charges for FY 2017-18 (Rs Crores)

Particulars Approved Actual Claim

Interest on GoA Loan 193.33 77.67 Interest on Bank Overdraft 7.30 7.30

Sl. Particulars Amount As per UDAY MoU

A GoA Loan for capital works & payment of liabilities (as on Sep

2015) 1510.04

B GoA Loan to be taken over (75% of A) 1132.53

C Grant (75% of B) 849.40

D Equity (25% of B) 283.13

E Total GoA Loan taken over under UDAY 1132.53

Impact of UDAY considered by the Commission

F Net normative loan at the beginning of FY 2016-17 343.06

G Loan converted to Grant in FY 2017-18 343.06 H Loan converted to Equity in FY 2017-18 0.00



Particulars Approved Actual Claim Bank Charges 4.26 4.26

Interest on GPF 28.03 28.03

Interest on New Pension Fund 4.93 4.93 Interest on R-APDRP Loan 60.00 60.00 Less: Interest Capitalized 78.03 42.40

Total 31.19 219.82 139.79

4.67 Amount of interest on Govt. Loan and RAPDRP loan allowable as per regulations

with the actual debt structure is depicted below:

Table 16: Interest on GoA loan and RAPDRP loan for FY 2017-18 (Rs Crores)

Particulars

Opening Balance

Addition during

the year

Repayment/ Adj during

the Year

Closing Balance

RoI

Interest

GoA Loan 750.34 105.10 52.45 802.99 10% 77.67

RAPDRP Loan 410.44 173.31 583.75 11.50% 60.00

4.68 The Commission has not allowed interest on RAPDRP Loan, interest on GPF,

interest on NPS etc. In this context, the following points are submitted:

At the time of unbundling, no funding was accommodated to APDCL

against the accumulated GPF balance along with interest. The same was

considered as a part of internal resources in the Asset Financing Structure

on formation of the company. Considering the perennial resource crunch

vis-à-vis pendency of approval from concerned authorities, no dedicated

GPF can be formed. As most of the employees covered under GPF will be

attaining superannuation within a very short span of time, formation of

trust at this juncture doesn’t seem operationally prudent. However, as per

the terms of transfer scheme on unbundling, APDCL is committed to

disburse the share of interest on GPF to every incumbent.

All contributions under NPS are being deposited regularly to NSDL as per

norms. However, APDCL is liable to pay interest for the period of delay in

uploading or generation of PRAN etc.

With bank accounts spread all across the state of Assam, APDCL is liable to

pay various charges levied by banks viz. cash handling charges, remittance

charges, and RTGS/NEFT charges wherever applicable.

4.69 With the facts stated above, APDCL claims the right to claim of Rs. 139.79Crores



on account of Interest and Finance charges in the true-up of ARR for FY 2017-18.

4.70 However, considering the observations made by the Hon’ble Commission in its

previous Tariff Orders, revised claim excluding interest liabilities on GPF as well

as NPS as depicted below is claimed in the instant petition to provide tariff relief

to that extent. Further, the interest on GoA loan amounting to Rs. 77.67 Crores is

kept in abeyance in order to provide tariff relief to that extent.

Table 17: Revised claim for Interest & Finance Charges for FY 2017-18 (Rs Crores)

Particulars Approved Actual Revised Claim

Interest on GoA Loan 193.33 - Bank Charges 4.26 4.26 Interest on GPF 28.03 -

Interest on New Pension Fund 4.93 - Interest on R-APDRP Loan 60.00 60.00 Less: Interest Capitalized 78.03 18.48

Total 31.19 212.52 45.78

Normative IWC claimed in the petition 5.58

Actual IWC (interest on bank overdraft) 7.30

Difference (1.72)

Net claim for interest & finance charges in this petition 47.50

4.71 The Petitioner requests the Hon’ble Commission to allow recovery of Rs.

47.50 Crores on account of interest & finance charges during true-up of

ARR for FY 2017-18, including actual payment of interest on bank

overdraft.

4.72 The Petitioner craves leave of the Hon’ble Commission to allow recovery of

actual cost incurred on interest on GPF as well as NPS at an opportune time

so as to safeguard the financial viability of the utility. Also, the Petitioner

requests to allow recovery of the interest on GoA loan at an opportune time

so as to safeguard the financial viability of the utility.

Interest on Working Capital

4.73 The interest on working capital has been calculated on normative basis in line

with the formula given by the Hon’ble Commission in MYT Regulations, 2015.

The same is depicted in the table below.



Table 18: Interest on Working Capital for FY 2017-18 (Rs Crores)


MYT Order

Submitted in APR

Approved in APR

True-up Deviation

O&M Expenses-One month 72.51 68.49 72.35 80.95 8.44 2-month Receivables 839.05 869.15 881.92 793.24 (45.81) Maintenance spares @ 15% of O&M Expenses

130.52 123.29 130.23 145.70 15.18

Less: One-month Power Purchase Cost 364.69 359.00 358.16 375.53 10.84 Less: Consumer Security Deposit 579.25 515.02 617.11 600.04 20.79 Total Working Capital 98.14 186.91 109.23 44.33 (53.81) Rate of Interest on WC 12.80% 12.80% 12.60% 12.60% Interest on WC 12.56 23.92 13.76 5.58 (6.98)

4.74 As against Rs. 12.56 Crores approved in the MYT tariff order dated March 31’

2017, Rs. 5.58 Crores has been worked out on normative basis of the interest on

working capital for FY 2017-18. The normative values of the components of

working capital requirement as per revised claims have been considered for the

calculation of the interest on working capital. The rate of interest has been

considered equal to State Bank of India base rate as on 1st April 2017 plus 350

basis points i.e. 12.60%. It is to be noted that the consumer security deposit of

Rs. 35.63 Crores of the permanently disconnected consumers has not been

considered here for calculation of the interest on working capital.

4.75 The interest on working capital amounting to Rs. 5.58 Crores as shown

above may be considered by the Hon’ble Commission in the true-up of ARR

for FY 2017-18.

Interest on Consumer Security Deposit

4.76 The Commission had approved Rs. 15.37 Crores as interest on consumer security

deposit for FY 2017-18 (as approved in tariff order dated March 19’ 2018).

However, actual interest liability on Consumer Security Deposits as per the

Statement of Accounts for FY 2017-18 on the basis of load security as on 1st

April of the year is Rs. 47.57 Crores.

4.77 It is to be noted that the amount of interest on consumer security deposits

amounting to Rs. 47.57 Crores will be liquidated subsequently with energy bills

for respective consumers and actual payment during the year is Rs. 14.43 Crores.

The Petitioner is claiming amount of Rs. 14.43 Crores actually liquidated

during the year to provide tariff relief to that extent. Considering the above,

APDCL prays before the Hon’ble Commission to allow recovery of amount

of Rs. 33.14 Crores (Rs. 47.57 Crores - Rs. 14.43 Crores) pending liquidation

during the year at the time of actual payment in subsequent periods.



Other Debits

4.78 The Hon’ble Commission had approved an amount of Rs. 14.42 Crores as

provision for bad & doubtful debts during APR for FY 2017-18 in the tariff order

dated March 19’ 2018. Actual amount booked under various heads of ‘Other

Debits’ for FY 2017-18 including bad &doubtful debt written-off is Rs. 23.43

Crores as per the accounts for FY 2017-18.However, it is to be noted that

expenditure head of Rs. 8.99 Crores on purchase of LED, tubelight, fan etc. is not

being claimed as the same is provided separately under the UJALA scheme.

4.79 Further, the Petitioner under the head of ‘Bad and doubtful debt written off’ has

netted-off the amount of Rs. 4.29 Crores shown under the head of ‘Other Income’

in the accounts for FY 2017-18 and accordingly considered the amount of Rs

(13.10 – 4.29) = 8.82 Crores under this head.

4.80 Element-wise break up of expenses booked under ‘Other Debits’ is detailed in the

table below for kind consideration of the Hon’ble Commission.

Table 19: ‘Other Debits’ for FY 2017-18 (Rs Crores)


MYT Order

Submitted in APR

Approved in APR

True-up Deviation

Compensation for injuries, deaths and damage of outsiders

1.34 1.34

Bad and doubtful Debt written off 8.82 8.82 Expenditure on purchase of LED, tube-light, fan etc.

0.00

Provision for Bad & Doubtful Debts 12.42 14.42 14.42 - (12.42 ) Total 12.42 14.42 14.42 10.15 (2.27 )

4.81 The Hon’ble Commission is requested to approve the amount of Rs. 10.15

Crores under the head of ‘Other Debits’ in true-up of ARR for FY 2017-18.

Net Prior Period Income/Expenses

4.82 The Hon’ble Commission has not allowed any amount on this head in its earlier

tariff orders. However, the actual component-wise breakup is detailed in the

table below.



Table 20: Net prior period income/expense for FY 2017-18 (Rs Crores)


Actual Remarks Prior Period Expenses

Operating Losses for Prior Period 17.26 Adjustment of targeted subsidy for FY 2016-17

Power Purchase for Prior Period 26.42 Adjustment of power purchase cost and wheeling charges of previous periods

Employee Cost related to Prior Period 0.00 Prior Period Depreciation Charges 0.02

Interest & finance relating to Prior Period 9.61 Refund of REC Ltd. against interest earned on fund rcvd. from REC

Administration expenses relating to prior period 0.01 Sub-Total 53.32 Prior Period Income

Interest Income for Prior Period 30.51 Related to auto renewal of STDR relating to previous years

Excess Provision in Prior Period 0.32

Other Income relating to Prior Period 27.34

Rs. 25.33 Crores related to reversal of power swapping arrangement, Rs. 2 Crores related to reversal of excess booking of NEEPCO’s fees and charges in FY 2016-17

Sub- Total 58.17 Net Prior Period Expenses/(Income) (4.85)

4.83 From the above, amounts charged to power purchase for prior period (Rs. 26.42

Crores) and operating losses(Rs. 17.26 Crores) is not claimed in the instant

petition considering observation by Hon’ble Commission in its previous orders.

Likewise, amount charged under the head of ‘Other Income’ relating to prior

period of Rs. 27.34 Crores is not claimed in the instant petition.

4.84 Considering the above, the Petitioner has claimed prior period expenses of

Rs. 9.64 Crores and prior period income of Rs. 30.84 Crores, amounting to

net prior period income of Rs. (30.84 – 9.64) = 21.20 Crores. The Hon’ble

Commission is requested to approve net prior period income of Rs. 21.20

Crores in the true-up of ARR for FY 2017-18.

Return on Equity

4.85 Hon’ble Commission had considered equity of Rs.162.77 Crores and allowed

return@16% on the equity base. The share application money pending allotment

amounting to Rs. 88.04 Crores transferred from erstwhile ASEB on transfer of

trading function to APDCL w.e.f. 01-04-2009 and Rs. 0.63 Crores transferred on



dissolution of ASEB on 31- 03-2013 was not considered by the Commission in its

tariff order dated March 19’ 2018.The Return on Equity claimed by the Petitioner

in the true-up of ARR for FY 2017-18 vis-à-vis approved earlier is presented in

the table below.

Table 21: Return on Equity for FY 2017-18 (Rs Crores)


MYT Order

Submitted in APR

Approved in APR

True-up Deviation

Opening Equity 162.77 251.45 162.77 162.77 - Net Addition during the Year - - - Closing Equity 162.77 251.45 162.77 162.77 - Average Equity 162.77 251.45 162.77 162.77 - Rate of Return on Equity 16.00% 16.00% 16.00% 16.00% - Return on Equity 26.04 40.23 26.04 26.04 -

4.86 Accordingly, Return on Equity amounting to Rs. 26.04 Crores may be

considered by the Hon’ble Commission.

4.87 It is to be noted that pending notification by Govt. on Share Application Money

Pending Allotment amounting to Rs. 88.04 Crores transferred from erstwhile

ASEB on transfer of trading function to APDCL w.e.f. 01-04-2009 and Rs. 0.63

Crores transferred on dissolution of ASEB on 31-03-2013 during FY 2017-18,

claim is made to the extent of approval by the Hon’ble Commission. The

Petitioner prays before the Hon’ble Commission to allow return on equity

on the above said share application money pending allotment once the

notification on the same is issued.

Other Income

4.88 Other income amount as approved vis-à-vis actual as per statement of accounts

for FY 2017-18 is depicted in the table below.

Table 22: Other Income for FY 2017-18 (Rs Crores)


MYT Order

Submitted in APR

Approved in APR

True-up Deviation

Interest from banks and investment 60.48 87.63 Receipt from sale of LED bulb, Tube light, Fan etc.

- -

Rent from residential buildings 0.03 0.05 Miscellaneous receipts 14.51 26.83 Bad and doubtful debts provided for - dues from consumers*

-

Receipt from Pension Trust 51.11 73.09 Income on seasonal export of surplus 31.47 144.20




MYT Order

Submitted in APR

Approved in APR

True-up Deviation

power/Revenue from Sale of Power - IEX Total 172.96 157.60 187.24 341.87 168.91

Note: * The same has been netted-off under ‘Bad and doubtful debt written-off’ in ‘Other Debits’ head.

4.89 It is to be noted that the receipt amount of Rs. 14.15 Crores is not being claimed

here as it is provided separately under the UJALA scheme.

4.90 An increase of Rs.168.91Crores is seen on this account over the approved

amount. Primary factor leading to the increase is export of seasonal power from

allocated sources due to significant gap in demand during peak and off-peak

hours. The Hon’ble Commission is requested to approve actual amount of

Rs. 341.87 Crores as ‘Other Income’ in the true-up of ARR for FY 2017-18.

Non-Tariff Income

4.91 Non-tariff income amount as approved vis-à-vis actual as per statement of

accounts for FY 2017-18 is depicted in the table below.

Table 23: Non-Tariff Income for FY 2017-18 (Rs Crores)


MYT Order

Submitted in APR

Approved in APR

True-up Deviation

Rentals from Meters, Service Lines, Capacitors, etc.

22.04 22.04 21.29

Income from recoveries on account of theft of energy/ Malpractices

0.29 0.29 0.74

Delayed Payment Charges from Consumers

147.81 147.81 160.71

Miscellaneous Recoveries 24.9 24.9 21.63 Cross Subsidy Surcharge on Open Access Consumer

9.96 9.96 24.91

Wheeling Charges collected 2.92 2.92 3.92 TOTAL 166.28 207.92 207.92 233.20 66.92

4.92 An increase of Rs.66.92 Crores is seen on this account over the figure as

approved in the MYT order. The Hon’ble Commission is requested to approve

actual amount of Rs. 233.20 Crores as Non-Tariff Income for FY 2017-18

during true-up of ARR for FY 2017-18.

Revenue Grant/Subsidy

4.93 The Commission has approved the tariff on gross basis without factoring the



targeted subsidy allowed to various category of consumers by Govt. of Assam.

Total amount of targeted subsidy booked during FY 2017-18 as per the

statement of accounts is Rs. 390.10 Crores.

4.94 In addition to the above, Govt. of Assam has also provided an amount of Rs.

560.58 Crores as Operation Fund Requirement as per the UDAY MoU during FY

2017-18. Out of this amount, Rs. 230.28 Crores pertains to FY 2016-17 and Rs.

330.30 Crores pertains to FY 2017-18. In this regard, the Hon’ble Commission in

the last tariff order dated March 19’ 2018 noted that the OFR amount provided

by GoA is for liquidation of outstanding power purchase liabilities and is not

intended to meet the revenue gap or targeted subsidy requirement. The

Commission noted that for various reasons, APDCL has been unable to meet its

obligations to pay the power purchase liabilities, and the GoA, as the owner of

APDCL, has provided OFR cash support under the terms of the UDAY MoU. Under

these circumstances, the amount of OFR support provided by GoA cannot be

considered as income for the purposes of APR.

4.95 In line with the treatment adopted by the Hon’ble Commission, the Petitioner has

not considered the OFR amount as income for arriving at the revenue

gap/(surplus) of the utility.

4.96 As such, subsidy amount of Rs. 390.10 Crores, be considered by the Hon’ble

Commission in the true-up of ARR for FY 2017-18.

Revenue from Sale of Power

4.97 Against the approved revenue of Rs. 5584.71Crores, the actual revenue collected

from sale of power within the state amounted to Rs. 4,369.35 Crores (excluding

targeted subsidy received of Rs. 390.10 Crores). The lesser recovery is primarily

attributed to the following factors:

Negatively skewed consumer mix

4.98 Considering the above, the actual revenue from sale of power within the

state as per the statement of accounts for FY 2017-18 amounting to Rs.

4369.35Crores (excluding govt. subsidy of Rs. 390.10 Crores) be

considered by the Hon’ble Commission in the true-up of ARR for FY 2017-

18.

True-up of ARR for FY 2017-18

4.99 Based on the submission in the above paragraphs, the Aggregate Revenue

Requirement (ARR) and revenue deficit/(surplus) of the utility for FY 2017-18



vis-à-vis earlier approved figures is as shown below:

Table 24: True-up of ARR for FY 2017-18 (Rs Crores)


MYT Order

Submitted in APR

Approved in APR

Actual True-up Deviation

Power Purchase Expenses 4376.29 4307.99 4297.87 4496.24 4506.31 130.02 O&M Expenses Employee Expenses 728.12 777.96 723.57 742.06 802.39 74.27 R&M Expenses 103.21 109.35 109.41 124.26 124.26 21.05 A&G Expenses 38.82 59.96 35.19 44.72 44.72 5.90 Depreciation 21.93 63.62 18.47 53.94 52.45 30.52 Interest and Finance Charges 14.14 73.86 31.19 219.82 47.50 33.36 Interest on Working Capital 12.56 23.92 13.76 5.58 (6.98) Interest on CSD 40.00 15.95 15.37 47.57 14.43 (25.57) Return on Equity 26.04 40.23 26.04 - 26.04 0.00 Prior Period Debits/(Income) (4.85) (21.20) (21.20) Other Debits, incl. Provisioning for Bad Debts

12.42 14.42 14.42 14.44 10.15 (2.27)

Sharing of gains/(losses) due to excess distribution losses

(13.12) (13.12)

Revenue Gap/(Surplus) of FY 14-15

657.96 657.96 657.96 657.96 657.96 0.00

Carrying Cost on Revenue Gap/(Surplus) of FY 14-15

179.29 179.29 179.29 179.29 179.29 0.00


354.52 354.52 354.52 354.52 354.52 0.00

Carrying Cost on Revenue Gap/(Surplus) of FY 15-16

45.38 45.38 45.38 45.38 45.38 0.00


(686.74) (242.25) (686.74) (686.74) (686.74) 0.00

TotalExpenditure 5923.95 6482.16 5835.71 6288.61 6149.93 225.98 Less: Non-Tariff Income 166.28 207.92 207.92 233.20 233.20 66.92 Less: Other Income 172.96 157.60 187.24 345.95 341.87 168.91 Aggregate Revenue Requirement

5584.71 6116.64 5440.55 5709.45 5574.86 (9.85)

Revenue at Approved Tariff (including FPPPA)

5584.71 4869.07 5291.50 4369.35 4369.35 (1215.36)

State Government Targeted Subsidy

- 345.81 - 390.10 390.10 390.10

State Government - OFR - 560.58 - - - - Total Revenue incl. subsidy 5584.71 5775.46 5291.50 4759.45 4759.45 (825.26) Revenue Gap/(Surplus) 0.00 341.18 149.04 950.00 815.40 815.40

Note: The figures mentioned in the ‘Actual’ column are as per the audited accounts

4.100 It can be observed that the Revenue Gap/ Deficit of Rs. 815.40 Crores has to be

recovered by revising the tariff in subsequent periods keeping some legitimate

claims in abeyance to provide tariff relief in the instant petition.

4.101 APDCL requests the Hon’ble Commission to approve total gap of Rs.

815.40Crores during true-up of ARR for FY 2017-18, along with the carrying cost

to be adjusted in the tariff for FY 2019-20.



4.102 It is to be noted that as per the Commission’s tariff order dated March 19’ 2018,

the Commission had considered revenue gap of Rs. 149.04 Crores in the APR for

FY 2017-18 vis-à-vis revenue gap of Rs. 815.40 Crores arrived during the true-up

exercise. The Commission had observed that the revenue gap arrived during APR

of FY 2017-18 has not been carried forward to the ARR of FY 2018-19 and would

be done during the true-up exercise. Accordingly, the Petitioner requests the

Commission to allow revenue gap of Rs. 815.40 Crores in tariff for FY 2019-20.

4.103 As per Regulation 10.6 of the MYT Regulations 2015, the carrying cost is to be

allowed for the trued-up amount (positive or negative) at the State Bank of India

base rate as on 1st April of the respective year plus 350 basis points. Carrying

cost on the trued-up revenue gap has been considered for FY 2017-18 (half

year), FY 2018-19 (full year) and FY 2019-20 (half year). The total revenue gap

along with the carrying cost is as shown below.

Table 25: Revenue Gap along with carrying cost for FY 2017-18 (Rs. Crores)

Particulars Rate of

Interest Amount (Rs. Crores)

Revenue Gap/(Surplus) for FY 2017-18 815.40

Carrying/(Holding) cost for FY 2017-18 (half Year) 12.60% 51.37

Carrying/(Holding) cost for FY 2018-19 (full Year) 12.20% 99.48

Carrying/(Holding) cost for FY 2019-20 (half Year) 12.45% 50.76

Total Carrying/(Holding) Cost 201.61 Total Revenue Gap for FY 2017-18 to be adjusted in FY 2019-20

1017.01

4.104 Accordingly, the Petitioner requests the Hon’ble Commission to allow total

revenue gap of Rs. 1017.01 Crores on account of true-up of ARR for FY 2017-18.

4.105 The Petitioner submits that the present true-up is being submitted based on the

provisional accounts. The final audited accounts along with report from

statutory auditor is yet to be received. The receipt is expected to be received in

December 2018. As the petition will go through the process of scrutiny,

validation till notification for public, Hon’ble Commission is requested to admit

the instant petition pending submission of statutory audit report. The CAG audit

will start after receiving the statutory audit report. However, it is to be submitted

that APDCL is committed to all endeavors to ensure submission of audit report as

early as possible.



5: PRAYER

APDCL requests the Hon’ble Commission to:

a. To admit the petition for true-up of ARR for FY 2017-18

b. To approve the amount of revenue gap for true-up of ARR for FY 2017-18 as

mentioned above

c. To condone any inadvertent omissions/ errors/ shortcomings and permit the

petitioner to add/ change/ modify/ alter this filing and make further

submissions as may be required at a future date

d. To allow further submissions, addition and alteration to this Petition as may

be necessitated from time to time

e. Treat the filing as complete in view of substantial compliance as also the

specific requests for waivers with justification placed on record

f. To grant any other relief as the Hon'ble Commission may consider

appropriate

g. And pass such other and further orders as are deemed fit and proper in the

facts and circumstances of the case in the interest of justice

BY THE APPLICANT THROUGH

General Manager (Tariff Regulatory Cell)

APDCL, Guwahati

Documents

True-up Petition for FY 2017-18 · True-up Petition for FY 2017-18 Assam Power Distribution Company Limited (APDCL) Page 6 BEFORE THE HON’BLE ASSAM ELECTRICITY REGULATORY COMMISSION,