Delhi discoms offer government a plan to cut power tariffs

Delhi's power distribution companies BSES Rajdhani Power Ltd (BRPL) and BSES Yamuna Power Ltd (BYPL), clearly stung by criticism that they are overcharging citizens for power, have written to the Delhi government asking for fuel linkages to be "re-directed" to high yielding plants - a proposal that they say could lead to a drop in tariffs by 5-7 per cent.

In the letter, the distribution companies or discoms have stressed the need for rationalisation and optimisation of the Delhi-based generation plants that could lead to a savings of about Rs77 crore and additional generation of about 820 million units (mu).

"The costs of state generating stations (SGS) have shown a dramatic increase in recent years from Rs3.43 per kWh in 2010-11 to Rs5.09 per kWh in 2012-13, i.e. an increase of 48 per cent. In 2013-14, it stands at Rs5.99 per kWh. NTPC Badarpur has recorded an increase from Rs3.81 per kWh in 2010-11 to Rs4.76 per kWh in 2012-13, an increase of 25 per cent. In 2013-14, it is Rs4.94 per kWh," said the letter signed by Gopal Saxena, chief executive of of BSES Rajdhani.

The discoms have urged the government to take up the closure of the Badarpur units with the power ministry. "When equipment at thermal plants becomes old, they become inefficient and require more fuel to produce the same amount of power.

The discoms also stated that while their power purchase costs had gone up over the last few years, the corresponding tariff hike had been only 75 per cent of this. "The cost at which discoms buy power has gone up by 300 per cent, while tariff has gone up by 75 per cent in the last 11 years. If this is implemented then the power tariff slabs will definitely see a reduction," discom officials said.

While the discoms in their letter to the Delhi government stated that the new plants at Aravalli and Bawana are much more efficient and have better heat rates, there remains a critical inadequacy of coal and gas allocation - a factor which they said would only improve once the existing three inefficient plants are shut down.

"The three plants are nearly 25 years old, wherein the Rajghat plant has also been recommended for closure by the Delhi Pollution Control Board. Fuel diversion would only enable a supply to the Aravalli and Bawana plants which are relatively new and much more fuel efficient," the official said.

While rotational load shedding is an option for discoms to address a situation of sudden shortage, North Delhi's discom Tata Power Delhi Distribution Limited (TPDDL) said it would approach commercial consumers to reduce their load, which would help the non-commercial consumers.

"Our Automatic Demand Response project will require commercial consumers such as malls and Delhi Metro to reduce their non-critical load. This means that in a mall if there are four elevators, during off-peak hours, we will request them to turn off two of them. We have identified 250 malls and industries whom we will contact as part of the project," the letter said.