for assam power distribution company limited (apdcl)apdcl order for truing-up of fy 2019-20, apr of...

1

ASSAM ELECTRICITY REGULATORY COMMISSION

(AERC)

TARIFF ORDER

February 15, 2021

True Up for FY 2019-20, APR for FY 2020-

21 and Revised ARR and Tariff for FY

2021-22

for

Assam Power Distribution Company

Limited (APDCL)

Petition No.s 17, 18 & 19/2020


Table of Contents

1 INTRODUCTION ........................................................................................................ 19

1.1 CONSTITUTION OF THE COMMISSION .............................................................................. 19

1.2 TARIFF RELATED FUNCTIONS OF THE COMMISSION ............................................................. 19

1.3 BACKGROUND ........................................................................................................... 20

1.4 MULTI YEAR TARIFF REGULATIONS, 2018 ....................................................................... 20

1.5 PROCEDURAL HISTORY ................................................................................................ 21

1.6 STATE ADVISORY COMMITTEE MEETING.......................................................................... 24

2 SUMMARY OF APDCL’S PETITION .............................................................................. 25

2.1 TRUE-UP FOR FY 2019-20 ........................................................................................... 25

2.2 ANNUAL PERFORMANCE REVIEW (APR) FOR FY 2020-21 .................................................. 26

2.3 AGGREGATE REVENUE REQUIREMENT FOR FY 2021-22 ...................................................... 27

2.4 PRAYERS OF APDCL ................................................................................................... 29

3 BRIEF SUMMARY OF STAKEHOLDERS’ COMMENTS, RESPONSE OF THE APDCL AND

COMMISSION’S VIEW ..................................................................................................... 31

ISSUE 10: INTEREST ON WORKING CAPITAL ............................................................................. 42

STAKEHOLDERS’ COMMENTS ................................................................................................. 42

ISSUE 11: RETURN ON EQUITY ............................................................................................... 43

ISSUE 12: REVENUE GRANTS/ SURPLUS ................................................................................... 44

ISSUE 16: INCREASE IN FIXED & ENERGY CHARGES ..................................................................... 47

ISSUE 17: POWER QUALITY .................................................................................................. 48

ISSUE 18: DETERMINATION OF TARIFF BASED ON VOLTAGE-WISE COST OF SUPPLY ............................. 49

ISSUE 19: TEMPORARY DISCONNECTION .................................................................................. 49

ISSUE 20: CAG REPORT & INDEPENDENT AUDITOR’S REPORT ...................................................... 50

STAKEHOLDERS’ COMMENTS ................................................................................................. 50

RESPONSE OF APDCL ......................................................................................................... 50

COMMISSION’S VIEW .......................................................................................................... 50

4 TRUING UP FOR FY 2019-20 ...................................................................................... 58

APDCL Order for Truing-Up of FY 2019-20, APR of FY 2020-21, ARR & Tariff of FY 2021-22 Page 2

4.1 METHODOLOGY FOR TRUING UP ................................................................................... 58

4.2 ENERGY SALES .......................................................................................................... 59

4.3 DISTRIBUTION LOSS .................................................................................................... 61

4.4 ENERGY REQUIREMENT ............................................................................................... 63

4.5 POWER PURCHASE ..................................................................................................... 65

4.6 SHARING OF GAINS/(LOSSES) ON ACCOUNT OF EXCESS POWER PURCHASE COST DUE TO HIGHER

THAN APPROVED DISTRIBUTION LOSSES ................................................................................... 72

4.7 O&M EXPENSES ....................................................................................................... 72

4.8 SHARING OF EFFICIENCY GAINS/(LOSSES) ON ACCOUNT OF O&M EXPENSES ............................ 77

4.9 CAPITAL INVESTMENT & CAPITALISATION ........................................................................ 79

4.10 DEPRECIATION ........................................................................................................ 81

4.11 INTEREST AND FINANCE CHARGES ................................................................................ 85

4.12 INTEREST ON WORKING CAPITAL ................................................................................. 87

4.13 INTEREST ON CONSUMER SECURITY DEPOSIT .................................................................. 89

4.14 PROVISION FOR BAD & DOUBTFUL DEBTS ...................................................................... 90

4.15 NET PRIOR PERIOD INCOME/(EXPENSES) ....................................................................... 90

4.16 RETURN ON EQUITY .................................................................................................. 93

4.17 OTHER INCOME ....................................................................................................... 94

4.18 NON-TARIFF INCOME ................................................................................................ 95

4.19 REVENUE FROM SALE OF POWER ................................................................................. 97

4.20 REVENUE GRANT/SUBSIDY ......................................................................................... 98

4.21 ARR AND REVENUE GAP/(SURPLUS) AFTER TRUING UP OF FY 2019-20............................... 99

5 ANNUAL PERFORMANCE REVIEW (APR) FOR FY 2020-21 ......................................... 101

5.1 INTRODUCTION ....................................................................................................... 101

5.2 ENERGY SALES ........................................................................................................ 102

5.3 DISTRIBUTION LOSS .................................................................................................. 104

5.4 ENERGY BALANCE .................................................................................................... 105

5.5 POWER PURCHASE ................................................................................................... 107

5.6 OPERATION AND MAINTENANCE (O&M) EXPENSES......................................................... 115

5.7 CAPITAL INVESTMENT AND FINANCING OF CAPITAL INVESTMENT ......................................... 119

5.8 DEPRECIATION ........................................................................................................ 120


5.9 INTEREST ON LOAN CAPITAL ....................................................................................... 125

5.10 INTEREST ON WORKING CAPITAL ............................................................................... 127

5.11 INTEREST ON CONSUMERS’ SECURITY DEPOSIT .............................................................. 128

5.12 PROVISION FOR BAD AND DOUBTFUL DEBTS ................................................................ 128

5.13 RETURN ON EQUITY ................................................................................................ 129

5.14 OTHER INCOME ..................................................................................................... 130

5.15 NON-TARIFF INCOME .............................................................................................. 132

5.16 REVENUE FROM SALE OF ELECTRICITY AT EXISTING TARIFF ................................................ 134

5.17 OTHER SUBSIDY FROM GOA ..................................................................................... 134

5.18 ARR AND REVENUE GAP/(SURPLUS) .......................................................................... 135

6 ARR FOR FY 2021-22 ............................................................................................... 137

6.1 INTRODUCTION ....................................................................................................... 137

6.2 ENERGY SALES ........................................................................................................ 137

6.3 CATEGORY-WISE ENERGY SALES .................................................................................. 137

6.4 DISTRIBUTION LOSS .................................................................................................. 140

6.5 ENERGY BALANCE .................................................................................................... 141

6.6 POWER PURCHASE ................................................................................................... 142

6.7 OPERATION AND MAINTENANCE (O&M) EXPENSES......................................................... 150

6.8 CAPITAL EXPENDITURE AND CAPITALISATION .................................................................. 154

6.9 DEPRECIATION ........................................................................................................ 155

6.10 INTEREST & FINANCE CHARGES ................................................................................. 159

6.11 INTEREST ON WORKING CAPITAL ............................................................................... 160

6.12 INTEREST ON CONSUMERS’ SECURITY DEPOSIT .............................................................. 161

6.13 PROVISION FOR BAD & DOUBTFUL DEBTS .................................................................... 162

6.14 RETURN ON EQUITY ................................................................................................ 162

6.15 NON-TARIFF INCOME .............................................................................................. 163

6.16 OTHER INCOME ..................................................................................................... 165

6.17 REVENUE FROM SALE OF POWER AT EXISTING TARIFF ..................................................... 166

6.18 ARR FOR FY 2021-22 ............................................................................................ 166

7 CUMULATIVE REVENUE GAP TILL FY 2021-22 AND TARIFF FOR FY 2021-22 ............... 168


7.1 CUMULATIVE REVENUE GAP ....................................................................................... 168

7.2 TARIFF PHILOSOPHY AND DESIGN FOR FY 2021-22 ......................................................... 171

7.3 CATEGORY-WISE CROSS-SUBSIDY ................................................................................. 176

7.4 FUEL PRICE AND POWER PURCHASE ADJUSTMENT CHARGES (FPPPA).................................. 177

8 WHEELING CHARGES AND CROSS-SUBSIDY SURCHARGE .......................................... 179

8.1 INTRODUCTION ....................................................................................................... 179

8.2 ALLOCATION MATRIX ............................................................................................... 179

8.3 WHEELING CHARGES ................................................................................................ 181

8.4 APPLICABLE WHEELING LOSSES ................................................................................... 182

8.5 CROSS-SUBSIDY SURCHARGE (CSS) .............................................................................. 182

8.6 APPLICABILITY OF TARIFF ........................................................................................... 183

9 DIRECTIVES ............................................................................................................ 184

10 TARIFF SCHEDULE ................................................................................................. 192

11 ANNEXURE 1: MINUTES OF THE 27TH MEETING OF THE STATE ADVISORY COMMITTEE

205


LIST OF TABLES

Table 1:True-up for FY 2019-20 as submitted by APDCL (Rs. Crore)...................... 25

Table 2: APR for FY 2020-21 as submitted by APDCL (Rs. Crore) .......................... 26

Table 3: ARR for 2021-22 as submitted by APDCL (Rs. Crore) ............................... 27

Table 4: Cumulative Revenue Gap till FY 2021-22 as proposed by APDCL (Rs. Crore)

................................................................................................................................ 27

Table 5: ARR for FY 2021-22 as proposed by APDCL (Rs. Crore) .......................... 28

Table 6: ARR Proposed for Recovery in FY 2021-22 (Rs. Crore) ............................ 29

Table 7: Energy Sales for FY 2019-20 as submitted by APDCL (MU) ..................... 59

Table 8: Energy Sales for FY 2019-20 approved by the Commission (MU) ............. 60

Table 9: Energy Requirement for True-Up for FY 2019-20 as submitted by APDCL

(MU) ........................................................................................................................ 63

Table 10: Energy Requirement approved by the Commission after True-Up for FY

2019-20 (MU) .......................................................................................................... 64

Table 11: Power Purchase for FY 2019-20 as submitted by APDCL (MU) ............... 66

Table 12: Power Purchase approved by the Commission after True-Up for FY 2019-

20 ............................................................................................................................ 69

Table 13: Sharing of Efficiency Gain/(Loss) on account of Distribution Losses approved

by the Commission (Rs. Crore)................................................................................ 72

Table 14: O&M Expenses for FY 2019-20 as submitted by APDCL (Rs. Crore) ...... 73

Table 15: Normative Employee Expenses for FY 2019-20 as submitted by APDCL (Rs.

Crore) ...................................................................................................................... 73

Table 16: Normative R&M Expenses for FY 2019-20 as submitted by APDCL (Rs.

Crore) ...................................................................................................................... 74

Table 17: Normative A&G Expenses for FY 2019-20 as submitted by APDCL (Rs.

Crore) ...................................................................................................................... 75

Table 18: Approved Employee Expenses for FY 2019-20 (Rs. Crore) ..................... 75

Table 19: Approved R&M Expenses for FY 2019-20 (Rs. Crore) ............................. 76


Table 20: Approved A&G Expenses for FY 2019-20 (Rs. Crore) ............................. 77

Table 21: Normative O&M Expenses approved by Commission for FY 2019-20 (Rs.

Crore) ...................................................................................................................... 77

Table 22: Sharing of gains or losses for O&M Expenses for FY 2019-20 as submitted

by APDCL (Rs. Crore) ............................................................................................. 78

Table 23: Sharing of gains/(losses) for O&M Expenses approved by the Commission

for FY 2019-20 (Rs. Crore) ...................................................................................... 78

Table 24: Capital Expenditure and Capitalization submitted by APDCL (Rs. Crore) 79

Table 25: Capital Expenditure and capitalisation approved by the Commission (Rs.

Crore) ...................................................................................................................... 80

Table 26: Funding of Capitalised Works approved by the Commission (Rs. Crore) . 80

Table 27: Depreciation Calculation for FY 2019-20 as submitted by APDCL (Rs. Crore)

................................................................................................................................ 82

Table 28: Depreciation Claimed by APDCL (Rs. Crore) ........................................... 83

Table 29: Depreciation approved for FY 2019-20 (Rs. Crore) .................................. 85

Table 30: Normative Interest as submitted by APDCL for FY 2019-20 (Rs. Crore) .. 86

Table 31: Approved Interest & Financing Charges for FY 2019-20 (Rs. Crore) ........ 87

Table 32: IoWC as submitted by APDCL for FY 2019-20 (Rs. Crore) ...................... 87

Table 33: IoWC approved by the Commission for FY 2019-20 (Rs. Crore) .............. 89

Table 34: Interest on CSD approved for FY 2019-20 (Rs. Crore)............................. 89

Table 35: Provision for Bad & Doubtful Debts as submitted by APDCL (Rs. Crore) . 90

Table 36: Provision for Bad & Doubtful Debts approved by the Commission (Rs. Crore)

................................................................................................................................ 90

Table 37: Net Prior Period Income/(Expenses) claimed by APDCL for FY 2019-20 (Rs.

Crore) ...................................................................................................................... 91

Table 38: Prior Period Income/(Expenses) approved by the Commission for FY 2019-

20 (Rs. Crore) .......................................................................................................... 92

Table 39: RoE as submitted by APDCL (Rs. Crore)................................................. 93

Table 40: RoE approved by the Commission for FY 2019-20 (Rs. Crore) ................ 94


Table 41: Other Income submitted by APDCL for FY 2019-20 (Rs. Crore) .............. 94

Table 42: Other Income approved by the Commission for FY 2019-20 (Rs. Crore) . 95

Table 43: Non-Tariff Income submitted by APDCL for FY 2019-20 (Rs. Crore) ....... 96

Table 44: Non-Tariff Income approved for FY 2019-20 (Rs. Crore).................. 97

Table 45: ARR & Revenue Gap/(Surplus) approved in the Truing up for FY 2019-20

(Rs. Crore) .............................................................................................................. 99

Table 46: Category-wise Energy Sales Projected by APDCL for FY 2020-21 (MU) 102

Table 47: Energy Sales considered by the Commission for FY 2020-21 (MU) ....... 103

Table 48: Distribution Losses considered by the Commission for FY 2020-21 ....... 105

Table 49: Energy Balance for FY 2020-21 as projected by APDCL (MU) .............. 106

Table 50: Energy Balance for FY 2020-21 considered by the Commission (MU) ... 106

Table 51: Power Purchase for FY 2020-21 as submitted by APDCL (Rs. Crore) ... 109

Table 52: Power Purchase Quantum and Cost considered by the Commission for the

FY 2020-21 ........................................................................................................... 112

Table 53: Employee Expenses projected for FY 2020-21 by APDCL (Rs. Crore) .. 115

Table 54: R&M Expenses for FY 2020-21 as submitted by APDCL (Rs. Crore) ..... 115

Table 55: A&G Expenses for FY 2020-21 as submitted by APDCL (Rs. Crore) ..... 116

Table 56: Employee Expenses considered for FY 2020-21(Rs. Crore) .................. 117

Table 57: R&M Expenses considered for FY 2020-21 (Rs. Crore) ......................... 118

Table 58: A&G Expenses considered for FY 2020-21 (Rs. Crore) ......................... 119

Table 59: Proposed financing of Capitalization for FY 2020-21 (Rs. Crore) ........... 119

Table 60: Actual Capitalization for FY 2017-18 to FY 2019-20 (Rs. Crore) ............ 119

Table 61: Capitalization and Funding for FY 2020-21 (Rs. Crore) .......................... 120

Table 62: Depreciation calculation for FY 2020-21 as submitted by APDCL (Rs. Crore)

.............................................................................................................................. 122

Table 63: Depreciation claimed by APDCL for FY 2020-21 (Rs. Crore) ................. 123

Table 64: Depreciation considered for FY 2020-21 (Rs. Crore) ............................. 124


Table 65: Interest Expenses as submitted by APDCL for FY 2020-21 (Rs. Crore) . 125

Table 66: Interest on Loan Capital considered for FY 2020-21 (Rs. Crore) ............ 127

Table 67 : IoWC considered by the Commission for FY 2020-21 (Rs. Crore) ........ 128

Table 68: Equity Addition allowed by the Commission due to Conversion of Grant to

Equity in FY 2020-21 (Rs. Crore) ........................................................................... 130

Table 69: Return on Equity considered by the Commission for FY 2020-21 (Rs. Crore)

.............................................................................................................................. 130

Table 70: Other Income as submitted by APDCL for FY 2020-21 (Rs. Crore) ....... 131

Table 71: Other Income considered for FY 2020-21 (Rs. Crore) ............................ 132

Table 72: Non-Tariff Income as submitted by APDCL for FY 2020-21 (Rs. Crore) . 132

Table 73: Non-Tariff Income as considered by Commission for FY 2020-21 (Rs. Crore)

.............................................................................................................................. 133

Table 74 :ARR & Revenue Gap/ (Surplus) considered by the Commission for FY 2020-

21 (Rs. Crore) ........................................................................................................ 135

Table 75: Category-wise Energy Sales Projected by APDCL for FY 2021-22 (MU) 138

Table 76: Growth rates considered for various categories for FY 2021-22 ............. 139

Table 77: Category-wise Energy Sales approved for FY 2021-22 (MU) ................. 140

Table 78: Energy Balance for FY 2021-22 as Projected by APDCL (MU) .............. 141

Table 79: Energy Balance for FY 2021-22 approved by the Commission (MU) ..... 142

Table 80: Power Purchase Quantum and Cost submitted by APDCL for FY 2021-22

(Rs. Crore) ............................................................................................................ 144

Table 81: Power Purchase Quantum and Cost approved for FY 2021-22 .............. 147

Table 82: Employee Expenses Projected by APDCL for FY 2021-22 (Rs Crore) ... 150

Table 83: R&M Expenses Projected by APDCL for FY 2021-22 (Rs Crore) ........... 151

Table 84: A&G Expenses Projected by APDCL for FY 2021-22 (Rs. Crore) .......... 151

Table 85: Employee Expenses Approved for FY 2021-22 (Rs. Crore) ................... 152

Table 86: R&M Expenses Approved for FY 2021-22 (Rs. Crore) ........................... 153

Table 87: A&G Expenses Approved for FY 2021-22 (Rs. Crore) ........................... 153


Table 88: Financing of the Projected Capitalisation for FY 2021-22 (Rs Crore) ..... 154

Table 89: Capitalisation and proposed funding approved for FY 2021-22 (Rs Crore)

.............................................................................................................................. 155

Table 90: Depreciation calculation of FY 2021-22 as submitted by APDCL (Rs. Crore)

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

Table 91: Depreciation claimed by APDCL for FY 2021-22 (Rs. Crore) ................. 157

Table 92: Depreciation approved for FY 2021-22 (Rs. Crore) ................................ 158

Table 93: Interest on Loan Capital as submitted by APDCL (Rs. Crore) ................ 159

Table 94: Approved Interest Expenses for FY 2021-22 (Rs. Crore) ....................... 160

Table 95: Interest on Working Capital submitted by APDCL (Rs Crore) ................. 160

Table 96: IoWC approved by the Commission for FY 2021-22 (Rs. Crore) ............ 161

Table 97: Return on Equity approved by the Commission (Rs. Crore) ................... 163

Table 98: Non-Tariff Income Projected by APDCL (Rs. Crore) .............................. 163

Table 99: Non-Tariff Income approved by the Commission for FY 2021-22 (Rs. Crore)

.............................................................................................................................. 164

Table 100: Other Income as submitted by APDCL (Rs. Crore) .............................. 165

Table 101: Other Income as approved by the Commission for FY 2021-22 (Rs. Crore)

.............................................................................................................................. 166

Table 102: ARR of APDCL for FY 2021-22 as approved by the Commission (Rs. Crore)

.............................................................................................................................. 167

Table 103: Cumulative Revenue Gap till FY 2021-22 as submitted by APDCL (Rs.

Crore) .................................................................................................................... 168

Table 104: ARR for FY 2021-22 as submitted by APDCL (Rs. Crore).................... 168

Table 105: ARR for FY 2021-22 as submitted by APDCL (Rs. Crore).................... 169

Table 106: Cumulative Revenue Gap/(Surplus) till FY 2021-22 as approved by the

Commission (Rs. Crore) ........................................................................................ 170

Table 107: ACoS Projected by APDCL for FY 2021-22 ......................................... 171

Table 107: ACoS approved by the Commission for FY 2021-22 ............................ 173


Table 108: Full Cost Tariff approved by the Commission for FY 2021-22 .............. 174

Table 109: Category-wise Cross-Subsidy approved for FY 2021-22 ...................... 176

Table 110: Separation of ARR for Wires and Retail Supply Business for FY 2021-22

as submitted by APDCL (Rs. Crore) ...................................................................... 179

Table 111: Allocation Matrix for Separation of ARR for Wires Business and Retail

Supply Business for FY 2021-22 ........................................................................... 180

Table 112: Separation of ARR for Wires Business and Retail Supply Business for FY

2021-22 (Rs. crore) ............................................................................................... 180

Table 113: Wheeling Charges submitted by APDCL for FY 2021-22 ..................... 181

Table 114: Wheeling Charges approved by the Commission for FY 2021-22 ........ 181

Table 115: Wheeling Losses approved by the Commission for FY 2021-22 .......... 182

Table 116: Category-wise CSS submitted by APDCL for FY 2021-22 ................... 182

Table 117: Category-wise CSS for FY 2021-22 as approved by the Commission .. 183


List of Abbreviations

A&G Administrative & General

ABC Aerial Bunched Conductors

ABITA Assam Branch of Indian Tea Association

ABT Availability Based Tariff

ABP Average Basic Pay

ABR Average Billing Rate

ACoS Average Cost of Supply

ADB Asian Development Bank

AEGCL Assam Electricity Grid Corporation Limited

AERC Assam Electricity Regulatory Commission

APDCL Assam Power Distribution Company Limited

APDRP Accelerated Power Development Reforms Programme

APGCL Assam Power Generation Corporation Limited

APM Administered Pricing Mechanism

APR Annual Performance Review

ARR Aggregate Revenue Requirement

APTEL Appellate Tribunal for Electricity

ASEB Assam State Electricity Board

AT&C Aggregate Technical and Commercial

BPL Below Poverty Line

CAC Consumer Advocacy Cell

CAEDCL Central Assam Electricity Distribution Company Limited

CAGR Compounded Annual Growth Rate

CAIDI Customer Average Interruption Duration Index

CAIFI Customer Average Interruption Frequency Index

CBDF Collection Based Distribution Franchisee

CEA Central Electricity Authority

CERC Central Electricity Regulatory Commission

CGRF Consumer Grievance Redressal Forum

CGS Central Generating Station

COD Date of Commercial Operation

CPC Central Pay Commission


CPI Consumer Price Index

CPSU Central Public Sector Utility

CSD Consumer Security Deposit

CSS Cross-subsidy Surcharge

CTU Central Transmission Utility

CWIP Capital Work In Progress

DA Dearness Allowance

D/C Double Circuit

DD Demand Draft

DDUGJY Deendayal Upadhyay Gram Jyoti Yojana

DEEP Discovery of Efficient Electricity Price

DELP Domestic Efficient Lighting Programme

DISCOM Distribution Company

DMS Distribution Management System

DPR Detailed Project Report

DSM Demand Side Management

DT/DTR Distribution Transformer

EA, 2003 The Electricity Act, 2003

EE Energy Efficiency

EHV Extra High Voltage

ERP Enterprise Resource Planning

ERS Emergency Restoration System

FINER Federation of Industry & Commerce of North Eastern Region

FPPPA Fuel Price and Power Purchase Adjustment

FY Financial Year

GFA Gross Fixed Assets

GoA Government of Assam

GoI Government of India

GPF General Provident Fund

HEP Hydro Electric Project

HH Household

HP Horse Power

HT High Tension

HV High Voltage


HVCMS High Value Consumer Management System

IEX Indian Energy Exchange

IOCL Indian Oil Corporation Limited

IPDS Integrated Power Development Scheme

IT Information Technology

IWC/IoWC Interest on Working Capital

JNNSM Jawaharlal Nehru National Solar Mission

kV kilo Volt

kVA kilo Volt Ampere

kW kilo Watt

kWh kilo Watt Hour

LAEDCL Lower Assam Electricity Distribution Company Limited

LED Light Emitting Diode

LOA Letter of Award

LT Low Tension

LTC Leave Travel Concession

LV Low Voltage

MAT Minimum Alternate Tax

MCLR Marginal Cost of Funds Based Lending Rates

MCP Market Clearing Price

MIS Management Information System

MNRE Ministry of New and Renewable Energy

MoP Ministry of Power

MOU Memorandum of Understanding

MRI Meter Reading Instruments

MU Million Unit

MW Mega Watt

MYT Multi-Year Tariff

NEEPCO North Eastern Electric Power Corporation Limited

NEP National Electricity Policy

NERPSIP North Eastern Region Power System Improvement Project

NESSIA North Eastern Small Scale Industries Association

NETA North Eastern Tea Association

NHPC NHPC Ltd.


NLCPR Non-lapsable Central Pool of Resources

NTPC National Thermal Power Corporation Ltd.

O&M Operation and Maintenance

OA Open Access

OPGW Optical Ground Wire

PFA Power for All

PFC Power Finance Corporation Limited

PGCIL Power Grid Corporation of India Limited

PLF Plant Load Factor

PTCIL PTC Indian Limited

R&M Repairs and Maintenance

RAPDRP Restructured Accelerated Power Development & Reforms

Programme

REC Renewable Energy Certificate

RGGVY Rajiv Gandhi Grameen Vidyutikaran Yojana

ROE Return on Equity

ROW Right of Way

RPO Renewable Purchase Obligation

Rs. Rupees

SAC State Advisory Committee

SAIDI System Average Interruption Duration Index

SAIFI System Average Interruption Frequency Index

SAUBHAGYA Pradhan Mantri Sahaj Bijli Har Ghar Yojana

SBI PLR State Bank of India Prime Lending Rate

S/C Single Circuit

SCED Security Constrained Economic Despatch

SECI Solar Energy Corporation of India Limited

SHEP Small Hydro Electric Project

SOP Standards of Performance

SPV Special Purpose Vehicle

STU State Transmission Utility

SLDC State Load Dispatch Centre

TBCB Tariff Based Competitive Bidding

TOD Time of Day


TVS Technical Validation Session

UAEDCL Upper Assam Electricity Distribution Company Limited

UI Unscheduled Interchange

UDAY Ujwal DISCOM Assurance Yojana

VCoS Voltage-wise Cost of Supply

WB The World Bank

WPI Wholesale Price Index



Guwahati

Present

Shri K. S. Krishna, Chairperson

Smt. B. Borthakur, Member

Shri S. N. Kalita, Member

Petition No. 17, 18 & 19/2020

Assam Power Distribution Company Limited (APDCL) - Petitioner

ORDER

(Passed on February 15, 2021)

(1) APDCL filed Petitions for approval of Truing up for FY 2019-20, Annual

Performance Review (APR) for FY 2020-21, revised Aggregate Revenue

Requirement (ARR) for FY 2021-22 and determination of Tariff for FY 2021-22

as per MYT Regulations, 2018 on November 28, 2020. The same were

registered as Petition Nos. 17, 18 & 19/2020.

(2) The Commission observed that there were several inconsistencies in the

Petition. The Commission raised queries in order to clarify the discrepancies,

inconsistencies, and data gaps. The Commission sought additional data and

clarifications on the Petitions vide letters dated December 10, 2020 and January

21, 2021.

(3) The Commission held an Admissibility Hearing on December 14, 2020 and

admitted the Petitions (Petition No.17, 18 & 19/2020) vide Order dated December

14, 2020, with direction to furnish the additional data and clarifications, as sought

vide letter dated December 10, 2020, by January 05, 2021.


(4) On admission of the Petitions (Petition No.17, 18 & 19/2020), in accordance with

Section 64 of the Electricity Act 2003, the Commission directed APDCL to publish

a summary of the ARR and Tariff filings in local dailies to facilitate due public

participation.

(5) Accordingly, a Public Notice was issued by APDCL inviting

objections/suggestions from objectors to be submitted on or before January 11,

2021. The notice was published in five (5) leading newspapers and short notice

was published in five (5) leading newspapers of the State, as shown in the table

below:

Date Name of Newspaper Content Published

17.12.2020 The Assam Tribune Public Notice in English

Dainik Jugasankhya (Bangla) Public Notice in English

Purbanchal Prahari (Hindi) Public Notice in English

Amar Asom Public Notice in Assamese

Dainik Janambhumi Public Notice in Assamese

18.12.2020 Asomiya Pratidin Short Notice in English

The Times of India Short Notice in English

The Sentinel Short Notice in English

Bodosa Short Notice in English

Thekar Short Notice in English

(6) A copy of the summary of the Petitions and other relevant documents were also

directed to be made available to the consumers and other interested Parties at

the office of the Managing Director of APDCL, and offices of the Deputy General

Manager of each circle of APDCL. A copy of the Petition was also made available

on the websites of the Commission and APDCL.

(7) The Commission decided to extend the last date of submission of

objections/comments on Tariff Petitions up to January 19, 2021. The notice was

published in one leading Assamese and one leading English newspaper on

January 07, 2021, as shown in the Table below:

Date Name of Newspaper

07.01.2021 The Times of India

07.01.2021 Asomiya Pratidin


(8) In response to the Commission’s letter dated December 10, 2020, APDCL

submitted their replies to data gaps on January 5, 2021.

(9) A Technical Validation Session was also held on January 20, 2021 at the

conference room of the Commission.

(10) The Petitions were also discussed in the 27th meeting of the State Advisory

Committee (SAC) (constituted under Section 87 of the Electricity Act, 2003) held

on December 19, 2020 at Bidyut Niyamak Bhawan, Six Mile, Guwahati.

(11) The Commission received suggestions and objections from six (6) stakeholders

on the Petitions filed by APDCL. The objectors were notified about the place,

date and time of Hearing, to enable them to take part in the Hearing. A notice

was also published in Newspapers inviting participation from the general public

as well as the Respondents. The Hearing was held at Bidyut Niyamak Bhawan,

Six Mile, Guwahati on February 6, 2021 as scheduled. All

stakeholders/respondents who participated in the Hearing were given the

opportunity to express their views on the Petitions. The details are discussed in

the Chapters attached with this Order.

(12) The Commission, now in exercise of its powers vested under Sections 61, 62,

86 and 181 of the Electricity Act, 2003 and all other powers enabling it in this

behalf and taking into consideration the submissions made by the Petitioner,

objections and suggestions received from objectors and all other relevant

materials on record, has carried out the True-up for FY 2019-20, APR for FY

2020-21 and approval of ARR and determination of distribution and retail supply

tariff for FY 2021-22, as detailed in the Chapters attached with this Order.

(13) The Commission directs APDCL to publish a Public Notice intimating the revised

distribution and retail supply tariff before the implementation of this Order in

English and Vernacular newspapers and on the website of APDCL.

(14) The approved Retail Supply Tariffs, Wheeling Charges and Cross-Subsidy

Surcharge (CSS) for FY 2021-22 shall be effective from April 1, 2021 and shall

continue until replaced by any subsequent Order of the Commission.

(15) Accordingly, the Petition No.s 17, 18 and 19/2020 stand disposed of.

Sd/- Sd/- Sd/-

(S.N. Kalita)

Member, AERC

(B. Borthakur)

Member, AERC

(K.S. Krishna)

Chairperson, AERC


1 INTRODUCTION

1.1 Constitution of the Commission

1.1.1 The Assam Electricity Regulatory Commission (hereinafter referred to as the AERC or

the Commission) was established under the Electricity Regulatory Commissions Act,

1998 (14 of 1998) on February 28, 2001. The first proviso of Section 82(1) of the

Electricity Act, 2003 (hereinafter referred as the Act or the EA, 2003) has ensured

continuity of the Commission under the Electricity Act, 2003.

1.1.2 The Commission is mandated to exercise the powers and functions conferred under

Section 181 of the Electricity Act, 2003 (36 of 2003) and to exercise the functions

conferred on it under Section 86 of the Act from June 10, 2003.

1.2 Tariff related Functions of the Commission

1.2.1 Under Section 86 of the Act, the Commission has the following tariff related functions:

a) To determine the tariff for electricity, wholesale, bulk or retail, as the case may be;

b) To regulate power purchase and procurement process of the distribution utilities

including the price at which the power shall be procured from the generating

companies, generating stations or from other sources for transmission, sale,

distribution and supply in the State;

c) To promote competition, efficiency and economy in the activities of the electricity

industry to achieve the objects and purposes of this Act.

1.2.2 Under Section 61 of the Act in the determination of tariffs, the Commission is to be

guided by the following:

a) The principles and methodologies specified by the Central Commission for

determination of the tariff applicable to generating companies and transmission

licensees;

b) The electricity generation, transmission, distribution and supply are conducted on

commercial principles;

c) Factors that would encourage efficiency, economical use of the resources, good

performance, optimum investments, and other matters which the State

Commission considers appropriate for the purpose of this Act;

d) The interests of the consumers are safeguarded and at the same time, the

consumers pay for the use of electricity in a reasonable manner based on the cost


of supply;

e) The tariff progressively reflects the cost of supply of electricity at an adequate and

improving level of efficiency and also gradually reduces cross subsidies;

f) The National Power Plans formulated by the Central Government including the

National Electricity Policy and Tariff Policy.

1.3 Background

1.3.1 As a result of notifications by the Government of Assam, vide Memo No.

PEL151/2003/Pt./165 dated December 10, 2004, Notification No PEL.41/2006/199

dated May 13, 2009 and in accordance with the Assam State Reform (Transfer and

merger of Distribution Functions and undertakings) Scheme, 2009 and Certificate of

Incorporation dated October 23, 2009, the present Distribution Company, i.e., Assam

Power Distribution Company Limited (APDCL) got formed.

1.3.2 Presently, APDCL is undertaking all the functions as a Distribution Company within the

State of Assam.

1.4 Multi Year Tariff Regulations, 2018

1.4.1 The Commission, in exercise of the powers conferred under Section 61 read with

Section 181(2) (zd) of the Act, notified the AERC (Terms and Conditions for

determination of Multi Year Tariff) Regulations, 2018 (herein after referred as “MYT

Regulations, 2018”) on July 17, 2018. 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, 2019 onwards up to

March 31, 2022. These Regulations are applicable to all existing and future Generating

Companies, Transmission Licensees and Distribution Licensees within the State of

Assam.

1.4.2 Regulation 4.2 of the MYT Regulations, 2018, specifies the MYT framework, as

reproduced below:

“4.2 The Multi-Year Tariff framework shall be based on the following elements, for

calculation of Aggregate Revenue Requirement and expected revenue from tariff and

charges for Generating Companies, Transmission Licensee, SLDC, Distribution

Wheeling Business and Retail Supply Business:

…


(vi) Annual Performance review vis-à-vis the approved forecast and categorization of

variation in performance as those caused by factors beyond the control of the applicant

(uncontrollable items) shall be undertaken by the Commission;

(vii) True up of the past years based on audited annual accounts of the licensees and

the Generation companies.

(viii) The mechanism for pass-through of approved gains or losses on account of

uncontrollable items as specified by the Commission in these Regulations;

(ix) The mechanism for sharing of approved gains or losses arising out of controllable

items as specified by the Commission in these Regulations;

(x) Tariff determination for Generating Companies, SLDC, Transmission Licensee and

Distribution Wheeling Business and Retail Supply Business, for each financial year

within the Control period based on the approved forecast. The tariff shall be reviewed

at the time of the true-up and annual performance review.

(xi) There will be no true-up of the controllable items except on account of Force

Majeure events or on account of variations attributable to uncontrollable items. The

variations in the controllable items, as defined in regulation 10, over and above the

norms specified will be governed by incentive and penalty framework specified in these

regulations.

(xii) The tariff determined by the Commission and the directions given in the MYT order

shall be the quid pro quo and mutually inclusive. The tariff determined shall, within the

time period specified in the order, be subject to the compliance of the directions by the

generating company and the licensees to the satisfaction of the Commission. Non-

compliance of directions given in the tariff order may also lead to invocation of the

provisions of section 142 of the Act.

(xiii) The tariff determined by the Commission shall continue to operate till it is modified

or revised by the Commission.”

1.5 Procedural History

1.5.1 In accordance with Regulation 18 of the MYT Regulations, 2018, APDCL is required

to file an application for true-up for previous year, i.e., FY 2019-20, APR of current


year, i.e., FY 2020-21, and revised ARR and Tariff for ensuing year, i.e., FY 2021-22,

by 30th November of each year of the Control Period. APDCL filed its Petitions for

approval of Truing-Up of FY 2019-20, APR of FY 2020-21 and ARR & Tariff for FY

2021-22 on November 28, 2020, in accordance with the MYT Regulations, 2018. The

same were registered as Petition No.s 17, 18 & 19/2020.

1.5.2 The Commission observed that there were several inconsistencies in the Petition. The

Commission raised queries in order to clarify the discrepancies, inconsistencies, and

data gaps. The Commission sought additional data and clarifications on the Petitions

vide letters dated December 10, 2020 and January 21, 2021. As the regulatory process

has to be completed within the stipulated time, the Commission has relied upon data

considered to be more accurate/reliable within the multiple conflicting data made

available to the Commission and has made appropriate assumptions wherever

necessary.

1.5.3 The Commission held an Admissibility Hearing on December 14, 2020, and admitted

the Petitions (Petition No.s 17, 18 & 19/2020) vide Order dated December 14, 2020 .

1.5.4 On admission of the Petitions (Petition No.s 17, 18 & 19/2020), in accordance with

Section 64 of the Electricity Act 2003, the Commission directed APDCL to publish a

summary of the ARR and Tariff filings in local dailies to facilitate due public

participation.

1.5.5 Further, APDCL was directed to publish advertisement in few other newspapers stating

that the copy of the Petition is made available on their website. A copy of the summary

of the Petition and other relevant documents were also directed to make available to

the consumers and other interested Parties at the office of the Managing Director of

APDCL, and offices of the Deputy General Manager of each circle of APDCL. A copy

of the Petition was also made available on the websites of the Commission and

APDCL.

1.5.6 Accordingly, a Public Notice was issued by APDCL inviting objections/suggestions

from objectors to be submitted on or before January 11, 2021. The notice was

published in five (5) leading newspapers of the State on December 17, 2020, and short

notice was published in five (5) of the leading newspapers of the State on December

18, 2020, as shown in the Table below:


Date Name of Newspaper Content Published

17.12.2020 The Assam Tribune Public Notice in English

Dainik Jugasankhya (Bangla) Public Notice in English

Purbanchal Prahari (Hindi) Public Notice in English

Amar Asom Public Notice in Assamese

Dainik Janambhumi Public Notice in Assamese

18.12.2020 Asomiya Pratidin Short Notice in English

The Times of India Short Notice in English

The Sentinel Short Notice in English

Bodosa Short Notice in English

Thekar Short Notice in English

1.5.7 The Commission decided to extend the last date of submission of

objections/comments on Tariff petition filed by APDCL up to January 19, 2021.The

notice was published in one leading Assamese and one leading English newspaper on

January 07, 2021, as shown in the Table below:

Date Name of Newspaper

07.01.2021 The Times of India

07.01.2021 Asomiya Pratidin

1.5.8 In response to the Commission’s letter dated December 10, 2020, APDCL submitted

their replies to data gaps on January 5, 2021.

1.5.9 The Commission received suggestions and objections from six (6) stakeholders on the

Petitions filed by APDCL. APDCL was asked to submit its responses to the

submissions of the stakeholders. The stakeholders were notified about the place, date

and time of Hearing, to enable them to take part in the Hearing. A Newspaper notice

was also published inviting participation from the general public as well as the

Respondents. The Hearing was held at Bidyut Niyamak Bhawan, Six Mile, Guwahati

on February 6, 2021 as scheduled. All stakeholders/respondents who participated in

the Hearing were given the opportunity to express their views on the Petitions.

1.5.10 All the written representations submitted to the Commission and oral submissions

made before the Commission in the Hearing and the responses of APDCL have been

carefully considered while issuing this Tariff Order. The major issues raised by different


consumers and consumer groups along with the response of APDCL, and views of the

Commission are elaborated in Chapter 3 of this Order.

1.6 State Advisory Committee Meeting

1.6.1 The 27th meeting of the SAC was convened on December 19, 2020 and members were

briefed on the Tariff Petition of APDCL. The minutes of the SAC meeting are appended

to this Order as Annexure 1.


2 Summary of APDCL’s Petition

2.1 True-up for FY 2019-20

2.1.1 APDCL submitted the True-up Petition for FY 2019-20 based on the Statement of

Accounts duly audited by the Statutory Auditor. The summary of the ARR and Revenue

Gap/(Surplus) claimed by APDCL for FY 2019-20 is shown in the following Table:

Table 1:True-up for FY 2019-20 as submitted by APDCL (Rs. Crore)

Sl. No.

Particulars Approved in

Order dtd 01.03.2019

APDCL Submission

1 Cost of power purchase 4722.41 5525.37

2 Operation & Maintenance Expenses 1049.79 921.69

2.1 Employee Cost 850.68 733.00

2.2 Repair & Maintenance 149.97 148.84

2.3 Administrative & General Expenses 49.14 39.86

3 Depreciation 17.77 49.39

4 Interest and Finance Charge 6.99 68.96

5 Interest on Working Capital 0.00 1.90

6 Other Debits incl. Provision for Bad Debt 12.35 22.10

7 Interest on Consumer security deposit 16.14 38.06

8 Exceptional Items, if any

22.51

9 Sub-total (1+2+(3 to 8)) 5825.45 6649.98

10 Return on Equity 26.04 26.04

11 Total Expenditure (9 to 10) 5851.49 6676.02

12 Less: Non-Tariff Income 257.11 408.46

13 Sharing of efficiency gain/(losses)

a) Reduction in Power Purchase cost due to incremental losses

(93.41)

b) Sharing of gains/(losses) on account of O&M expenses

(3.67)

14 Aggregate Revenue Requirement (11-12+13) 5594.38 6170.48

15 Revenue with approved Tariff (including Targeted Subsidy)

5592.99 5391.51

16 Other Income (Consumer Related) 253.67 586.73

17 Total Revenue Before Other Subsidy (17+18) 5846.66 5978.23

18 Other subsidy/Revenue Grant

238.95

19 Total Revenue after subsidy 5846.66 6217.18

20 Gap/(Surplus) Standalone FY 2019-20 (252.28) (46.71)

21 True up adjustment

Differential Revenue Gap/(Surplus) of FY 2017-18 to be recovered in FY 2019-20

175.19 175.19

Net Carrying Cost 77.09 77.09


Sl. No.


Order dtd 01.03.2019

APDCL Submission

Sub-total (21): True Up adjustment 252.28 252.28

22 Gross Gap/(Surplus) 0.00 205.57

2.2 Annual Performance Review (APR) for FY 2020-21

2.2.1 APDCL submitted the APR for FY 2020-21, based on the first half actual and

projections for the second half. The submission made by APDCL is shown in the table

below:

Table 2: APR for FY 2020-21 as submitted by APDCL (Rs. Crore)

Sl. No.

Particulars

Approved in Order

dtd 07.03.2020

APDCL Submission



2.1 Employee Cost 779.26 771.83









9 Sub-total (1+2+(3 to 8)) 6315.68 7061.36




13 Aggregate Revenue Requirement (11-12) 6044.36 6767.43


5127.43 5344.36


16 Total Revenue Before Other Subsidy (14+15) 5644.36 5935.52

17 Other subsidy/Revenue Grant 400.00 300.00

18 Total Revenue after subsidy 6044.36 6235.52

19 Gap/(Surplus) Standalone FY 2020-21 0.00 531.91


2.3 Aggregate Revenue Requirement for FY 2021-22

2.3.1 APDCL has claimed the revised ARR for FY 2021-22 as detailed in the Table below:

Table 3: ARR for 2021-22 as submitted by APDCL (Rs. Crore)

Sl. No.


Order dtd 01.03.19

APDCL Submission



2.1 Employee Cost 934.52 837.99









9 Sub-total (1+2+(3 to 8)) 6730.50 7428.22




13 Aggregate Revenue Requirement (11-12-13) 6473.08 7305.80


* 6157.48


16 Total Revenue Before Other Subsidy (17+18) * 6498.88

17 Other subsidy/Revenue Grant

18 Total Revenue after subsidy * 6498.88

19 Gap/(Surplus) Standalone FY 2021-22 * 806.92

Note: * No tariff was approved for FY 2021-22, hence, the revenue was not approved

2.3.2 APDCL has thus estimated the Cumulative Revenue Gap for FY 2021-22 as shown in

the Table below:

Table 4: Cumulative Revenue Gap till FY 2021-22 as proposed by APDCL (Rs. Crore)

Sr. No. Particulars Rate of Interest

Revenue Gap

1 Revenue Gap after true-up for FY 2019-20 _ 205.57

2 Carrying/(Holding) cost for FY 2019-20 (half Year)

11.54% 11.86

3 Carrying/(Holding) cost for FY 2020-21 (full Year)

10.91% 22.42

4 Carrying/(Holding) cost for FY 2021-22 (half Year)

10.00% 10.28


Sr. No. Particulars Rate of Interest

Revenue Gap

5 Total carrying cost 44.57

6 Total Revenue Gap for FY 2020-21 250.14

7 Revenue Gap for FY 2021-22 806.92*

8 Cumulative Revenue Gap for FY 2021-22 1056.93*

Note: * corrected by APDCL vide its replies dated 05.01.2021

2.3.3 APDCL submitted that the ARR for FY 2021-22 works out to Rs. 7214.54 crore as

under:

Table 5: ARR for FY 2021-22 as proposed by APDCL (Rs. Crore)

Sr. No. Particulars Amount

A Standalone ARR 6964.40

B True-up for FY 2019-20

i Principal amount 205.57

Ii Carrying cost 44.57

Sub-total (B) 250.14

Grand Total (A+B) 7214.54

2.3.4 APDCL submitted that the Average Cost of Supply (ACoS) to recover entire ARR of

Rs. 7214.54 Crore during FY 2021-22 will be Rs. 8.62/kWh, as against the approved

ACoS of Rs. 7.87/kWh for FY 2020-21 (without Government Subsidy).

2.3.5 APDCL submitted that recovery of entire amount of Rs. 7214.54 Crore will lead to

average increase of existing retail tariff by 10% over approved ACoS. At the same

time, delayed recovery of dues will have adverse effect on APDCL regarding discharge

of its obligations.

2.3.6 APDCL submitted that it has received Rs. 69.99 Crore as rebate from CPSU

Generating Companies (Gencos) pursuant to Ministry of Power, Govt. of India’s

advisory during May, 2020 to provide some respite to the retail consumers of the

DISCOM. Further, enhancement of equity pursuant to conversion of loan/grant with

enhanced Authorised share capital, the RoE for FY 2021-22 is estimated at Rs. 287.33

Crore against prevailing Rs. 26.04 Crore.

2.3.7 APDCL submitted that being sensitive to its valued consumers and the global crisis

faced by every segment of consumers, APDCL is proposing to recover only Rs.

6883.26 Crore by passing the benefit of Rebate from CPSU Gencos for COVID during


FY 2020-21 and keeping the claim on additional RoE in abeyance for truing up as

under:

Table 6: ARR Proposed for Recovery in FY 2021-22 (Rs. Crore)

Sr. No. Particulars Amount

a Standalone ARR 6964.40

a1 Additional RoE on enhancement of equity 261.29

A Net amount with additional RoE (a – a1) 6703.11

B True-up for FY 2019-20

i Principal amount 205.57

Ii Carrying cost 44.57


C Rebate from CPSU Gencos for COVID during FY 2020-21

69.99

Grand Total (A+B-C) 6883.26

2.3.8 APDCL requested the Commission to consider passing of rebate from CPSU Gencos

for COVID-19 during FY 2020-21and actual RoE for FY 2021-22 at the time of Truing

Up for respective years.

2.3.9 APDCL submitted that recovery of the reduced amount of Rs. 6883.26 Crore will lead

to only 5% average increase on approved ACoS, i.e., ACoS of Rs. 8.26/kWh for FY

2021-22.

2.3.10 APDCL proposed revised tariffs in order to recover the Revenue of Rs. 6883.26 crore

for FY 2021-22, which is elaborated in the Chapter on Tariff Philosophy.

2.4 Prayers of APDCL

2.4.1 Prayers of APDCL, in its Petition, are reproduced below:

“

1. To admit the petition for true-up of ARR for FY 2019-20

2. To approve the amount of revenue gap for true-up of ARR for FY 2019-20 as

mentioned above

3. To admit the petition for annual performance review for FY 2020-21

4. To approve the amount of revenue gap as mentioned above for annual

performance review for FY 2020-21

5. To admit the petition for annual revenue requirement for FY 2021-22.

6. To approve the amount of revenue gap for FY 2021-22

7. 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

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

necessitated from time to time

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

requests for waivers with justification placed on record

10. To grant any other relief as the Hon’ble Commission may consider appropriate.

11. 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”.


3 Brief Summary of Stakeholders’ Comments,

Response of the APDCL and Commission’s View

3.1.1 The Commission received objections/suggestions from the following six (6)

stakeholders on the Petition filed by APDCL.

Sl. No. Name of Respondent

1 Assam Branch of India Tea Association (ABITA)

2. Consumer Advocacy Cell (CAC)

3. Federation of Industries and Commerce of North Eastern Region (FINER)

4. Indian Energy Exchange (IEX)

5. North Eastern Small Scale Industries Association (NESSIA)

6. North Eastern Tea Association (NETA)

3.1.2 APDCL submitted its responses to the objections/suggestions received from the above

stakeholders.

3.1.3 The Commission considered the objections / suggestions received and notified the

Respondents to take part in the Hearing process by presenting their views in person

before the Commission, if they so desired.

3.1.4 The Commission held Public Hearing at Bidyut Niyamak Bhawan, Six Mile, Guwahati

on February 06, 2021.

3.1.5 The respondents attended the Hearing and submitted their views/ suggestions. In

addition to the above respondents, Grahak Suraksha Sanstha (GSS) made oral

submissions on APDCL’s Petition during the Public Hearing.

3.1.6 All the written representations submitted to the Commission and the oral submission

made before the Commission in the Hearing and the responses of APDCL have been

carefully considered while issuing this Tariff Order.

3.1.7 The objections/ suggestions made by the stakeholders and responses of the Petitioner

are briefly dealt with in this Chapter. The major issues raised by the respondents are

discussed below along with the response of the Petitioner (APDCL) and views of the

Commission.

3.1.8 The figures quoted in the submissions by the respondents/Petitioner are as mentioned


by them in their respective submissions. While all the objections /suggestions have

been given due consideration by the Commission, only major responses/ objections

received on the Petitions and also those raised during the course of Hearing have been

grouped and addressed issue-wise, in order to avoid repetition.

Issue 1: Energy Sale & Projection

Stakeholders’ Comments

ABITA submitted that the actual sales for FY 2019-20 are lower than the approved sales.

ABITA requested the Commission to review the sales in Jeevan Dhara category and HT

Industries where the deviation from numbers in APR Order is more than +10%.

ABITA also observed that APDCL has projected energy sale of 7261 MU and 8366 MU

against approved sales of 7815 MU and 8962 MU for FY 2020-21 and FY 2021-22

respectively. ABITA analysed the sales projections across various categories and noticed

that although APDCL has taken into account the CAGR of 5 years across categories, the

projected numbers are inconsistent.

CAC submitted that projected sale for 2019-20 is lesser by an amount of 673 MU from the

approved figure of 7930 MU, although there was 4% growth in sales for FY 2018-19. CAC

observed that such reduction of load should reduce the distribution losses too. CAC

questioned as to how the breakup of category wise energy sales was derived at in absence

of any energy auditing scheme.

Response of APDCL

APDCL submitted that deviation in sales for respective category was elaborated in details

in relevant chapter of the petition. The proposition of growth trajectory for each category is

mentioned in respective chapters of respective petitions.

APDCL submitted that energy sales quantum as depicted in the petition is cumulative

energy billed during the FY 2019-20 to all category of consumers. APDCL submitted that

all the information submitted in the true up petition are supported by statement of accounts

duly audited by Statutory Auditors.

Commission’s View

The category-wise sales approved by the Commission are discussed in relevant Chapters

of this Order.


Issue 2: Distribution loss


ABITA and FINER submitted that APDCL’s actual distribution loss of 19.06% in FY 2019-

20 against the approved level of 16.00% is even higher than the distribution loss target set

for FY 2013-14. APDCL’s rationale for non-achievement of distribution loss includes

manifold increase in LV consumers, deferred implementation of various schemes, age of

assets and inverse HT/LT ratio.

ABITA submitted that all over India, there is increase in number of consumers through

various schemes such as RGGVY/ SAUBHAGYA. However, technological and

infrastructure improvement-oriented schemes under R-APDRP and IPDS have supported

the distribution utilities in obtaining substantial technical and commercial loss reduction

levels. ABITA observed that APDCL has also committed under UDAY scheme to reduce

AT&C loss levels in the State of Assam to 15% for FY 2019-20.

ABITA further submitted that, even after having hilly terrain and remote habitations, states

like Himachal Pradesh and Uttarakhand were able to reduce the losses in the range of 12-

13%. FINER submitted that Uttar Pradesh (UP) the distribution losses have reduced from

21.30% in FY 2017-18 to 18.68% in FY 2018-19, 11.96% in FY 2019-20 & 11.54% in FY

2020-21 despite implementation of Saubhagya Scheme.

In view of the above, ABITA & FINER requested the Commission to consider the loss

target of 16% for FY 2019-20, while computing power purchase cost.

Moreover, ABITA & FINER requested the Commission to consider distribution loss of

15.5% and 15% for FY 2021 and FY 2022 respectively instead of estimated 18.50%

for FY 2020-21 and 17.50% for FY 2021- 22.

CAC submitted that the figures of distribution losses appear to be fictitious and arbitrary

in the absence of system study followed by energy audit. However, APDCL has correctly

pointed out that high LT: HT ratio is one of major reasons for high distribution loss. CAC

submitted that rural consumers need the same quality of power as that of urban consumers

and APDCL must take up the required projects for rural consumers to improve LT: HT ratio

for which the State Government has to extend financial assistance. CAC requested the

Commission to advise the State Government on this crucial matter.

NETA opined that the Petitioner’s Transmission & Distribution loss is one of the highest

in the country and to mitigate it they are compelled to procure additional power at a higher

cost than the approved quantum and budget.


NETA stated that the reasons for higher losses can be attributed to power theft / Illegal

connections / inefficient supervision / Mismanagement / Corruption.

NETA requested the Commission not to allow excess transmission and distribution losses

and provide a reduction in power tariff across all sectors and categories.

Response from APDCL

APDCL submitted that domestic consumer base has increased by 40% over FY 17-18.

Such massive inclusion of consumers at low voltage without adequate HT infrastructure

has only distorted the HT:LT ratio.

APDCL further submitted that there is no comparison of Assam with Himachal Pradesh

(HP) and Uttarakhand. Share of Domestic consumption in Himachal and Uttarakhand is

16.55% and 22.54% against 46.31% in Assam with national average of 28.01% during FY

2018-19. Around 60% of consumption in HP is higher voltages unlike Assam.

APDCL submitted that all earnest efforts are taken on regular basis to optimize the

efficiency within the constrained resources. The submission on reduction of losses in

UP is factually incorrect.

APDCL submitted that it has already taken up various projects to improvise the adverse

LT:HT ratio through EAP. However, massive investment is required to reach the standard

level. APDCL stated that the Company is taking up projects in phased manner within its

constraints in complete support from the Government.

Commission’s Views:

Distribution Losses are a controllable parameter. The Commission has considered the

approved Distribution Loss level, and disallowed the excess power purchase cost in the

true-up of FY 2019-20 by restricting the power purchase quantum to that corresponding to

the approved Distribution Loss level. The Distribution Loss approved for FY 2021-22 is

elaborated in Chapter 6 of this Order.

Issue 3: Power Purchase


ABITA & FINER submitted that APDCL claimed Rs. 5525 Cr. as power purchase cost for

FY 2019-20 as against Rs. 4722 Cr. approved.


FINER & ABITA observed that large amounts have been spent through short term

procurement (IEX, DSM) which needs to be analysed. FINER observed that as per the

energy sales data available on Indian Energy Exchange website the average power

purchase rate for FY 2019-20 has been Rs. 2.997/kWh for North East Region, whereas

the average purchase cost of the energy procured by APDCL from short term market has

been Rs. 4.21/kWh and therefore, the burden of additional cost of Rs 137.18 Crore

incurred by APDCL on account of power purchase made through short term sources

should not be passed on the consumers of the state. FINER observed that APDCL may

be directed to engage and develop software based solution for Real Time Mechanism

(RTM) for better forecasting of power purchase from bilateral sources.

ABITA requested the Commission to direct the petitioner for planning its power

procurement in advance and undertake procurement through DEEP portal to ensure that

short-term power is procured at competitive rates. FINER observed that it would be critical

to examine as to whether APDCL has obtained any prior approval of the Commission for

procuring power form the short term where the rate of exceeded more than 105% of the

power purchase rate approved by the Commission in accordance with the AERC (Fuel

and Power Purchase Price Adjustment Formula) Regulations, 2010 and its amendments

thereof.

ABITA proposed that the rebate on power purchase payment may be adjusted from the

total power purchase amount. ABITA requested the Commission to undertake adequate

prudence check while approving the Power Purchase Cost

FINER requested the Commission to do prudence check on the floor price of solar and

non- solar REC procured by the Petitioner towards fulfilment of the RPO obligations.

CAC submitted that the unit cost of power for long term Power Purchase Agreement (PPA)

entered into by APDCL with various agencies like NTPC (BTPS), NVVL solar bundled,

Suryataap Solar, etc., is very high. CAC suggested that APDCL should have a dynamic

power purchase policy and constantly monitor the power market for cheaper power. CAC

observed that even without drawing power as envisaged in PPA, APDCL is liable to pay

fixed charges for the contracted load. CAC further observed that the State-run generating

Company continued to deliver poor performance and has contributed only 13% of energy

against an approved 22%.

NETA suggested that the Petitioner should purchase power through agencies like Indian

Energy Exchange (IEX), and from Bhutan, which is the cheapest in the world. This would


help to reduce Retail Tariff substantially.

Response of APDCL

APDCL mentioned that the Company procures power from IEX primarily to meet the peak

shortfall. As such, comparison is required to be made with Peak MCP and not with RTC

and claim of petitioner is in parity with that.

APDCL stated that weighted average rate of bilateral contracts (through DEEP portal) for

Peak power during FY 2019-20 is Rs. 5.87 per unit (without PoC drawal charges) against

actual expenditure of APDCL at Rs. 4.31 per unit during the same period from IEX & other

approved sources on short term basis, which only indicates the earnest efforts on part of

APDCL to optimize the available resources. Bilateral procurement was as per approval

from the Commission.

APDCL submitted that procurement of REC is an instrument to mitigate RPO compliance

and the same is passed through as considered by the Commission.

APDCL submitted that power procurement of APDCL is predominantly dependent on the

state generating stations of APGCL and allocation from central generating stations. With

31% share of hydro power with seasonal volatility and perennial low performance on part

of APGCL due to various factors, APDCL has to procure power during peak hours from

market. APDCL is taking various steps to optimize the power purchase cost with respect

to its consumer mix. Ministry of Power constituted an Expert Group to work out possible

reduction in the cost of power from Bongaigaon TPP of NTPC Ltd. to North Eastern States.

APDCL has already proposed for surrendering of power from NHPC Subansiri project

anticipating the higher tariff consequent to significant delay. APDCL further informed that

dedicated power purchase monitoring team is there for constant round the clock

monitoring of all activities to ensure optimal result.

Commission’s Views

The Commission has allowed power purchase cost as per provisions of MYT Regulations,

2018, only after prudence check, as elaborated in the relevant Chapters of this Order.

Issue 4: Power Exchange as part of the Merit Order Despatch


IEX submitted that in FY 2020-21 the Petitioner has procured 506 MUs from exchange at

an average rate of Rs. 3.26/ unit. IEX suggested that the Commission may consider


formalising the optimisation through market by evolving appropriate procedure for

considering short term market rates while finalising the Merit Order of the Discom. IEX

submitted that on similar grounds, UPERC has recently issued the Draft Merit Order

Despatch and Power Purchase Optimization Regulations, 2020, wherein it is mandated to

consider the opportunities in the market while procuring power.

In view of the above, IEX proposed that the Commission may consider evolving

appropriate framework by which the STOA/Power Exchange rates can be considered as a

part of the merit order of Discom.

Response from APDCL

APDCL submitted that the typical consumer mix vis-à-vis demand pattern coupled with

power from MUST RUN hydro and renewable sources compels partial drawal from

allocated sources with fixed cost burden. Such partial requisition is permissible only to the

extent of technical minimum for respective stations posing operational challenges over and

above commercial aspects.

APDCL mentioned that in the event of surrendering power from allocated sources, APDCL

will have to bear the fixed cost till the power is not allocated to other entity as per the

prevailing regulations. As such, detailed analysis on all aspects is required, particularly in

State perspective prior to making additional provisions as proposed.

Commission’s Views

Noted. The Commission directs the Petitioner to study the matter and take suitable actions

to optimise the Power Purchase Cost.

Issue 5: Purchase of Renewable power from the G-TAM market


IEX submitted that the Discom can fulfil its pending RPO obligations as well as the targets

in forthcoming years by procuring RE power through the GTAM market. Green Term

Ahead Market (GTAM) was introduced during FY 21 at IEX platform w.e.f. 21.08.2020

wherein Solar and Non-Solar renewable energy is being transacted in four contracts

namely intra-day, Day Ahead contingency, Daily and Weekly. The buyers of this market

can fulfil their respective RPOs at competitive price with flexibility of entry and exit in the

market.


IEX further submitted that the market has witnessed an encouraging response and has

registered trade of around 550 MUs since launch. Therefore, IEX requested the

Commission to allow an explicit provision of RE power purchase through GTAM market.

Commission’s View

The Commission directs the Petitioner to study the matter and take suitable actions to

optimise the Power Purchase Cost by exploring all available options.

Issue 6: O& M Expenses


ABITA submitted that APDCL has claimed higher O&M expenses than that approved by

the Commission for FY 2019-20, FY 2020-21 and FY 2021-22. ABITA recalculated these

expenses separately in accordance with the AERC MYT Regulations, 2018 and requested

the Commission to consider the same.

FINER too reviewed the calculations for O&M expenses for FY 2019-20, FY 2020-21 and

FY 2021-22 and requested the Commission to consider their revised submissions. FINER

submitted that the Petitioner has claimed a provision of Rs. 2.00 crore, without submitting

any details for the same.

CAC submitted that since all O&M expenses have been assessed at Normative basis

without reflecting the actual expenditure, it’s difficult to judge the performance of APDCL.

CAC submitted that the Cell has been underlining the need to change the norms of MYT

Regulation - 2018 for the simple reason that normative expenses do not bring out the

actual picture of the utility. CAC further submitted that for FY 2019-20, growth factor of

employee expenses is zero against 1% approved by the Commission. CAC suggested that

pragmatic manpower planning for the Company is required for future growth. CAC

suggested that a comprehensive training policy needs to be formulated also for outsourced

technical workers, office assistants, bill clerks and meter readers engaged by APDCL so

that they can be accommodated into the Company in future.

Response of APDCL

The submission of the respondent is very arbitrary and selective to suit its cause. Claims

against respective head of accounts are made in strict adherence to governing regulations.


All detailed calculations and justifications on heads of expenses are submitted before the

Commission for prudence check.

Details in regard to provision of Rs. 2.00 Crore has been submitted to the Commission.

APDCL requested the Commission not to take cognizance of the submissions by the

respondent.

Replying to the submissions of CAC, APDCL submitted that basis for consideration various

parameters for calculation as per regulation are aptly mentioned in the petition. Regarding

manpower planning vis-à-vis status of recruitment process was also mentioned in the

petition.

Commission’s View

The Commission has allowed O&M expenses as per provisions of MYT Regulations, 2018

after prudence check, as elaborated in the relevant chapters of this Order.

Issue 7: Capital Expenditure and Capitalization


ABITA & FINER submitted that APDCL has claimed actual capitalization during FY 2019-

20 is Rs. 1343.10 Cr. (Rs. 1295.54 Cr. from CWIP and rest through direct acquisition) as

against Rs. 650 Cr. approved in March 2019 order and the APR order of March 2020.

However, the respondents observed that APDCL didn’t provide the actual scheme-wise

capital expenditure and capitalisation achieved in FY 2019-20 with other details and also

the reasons for delay in execution of the projects.

The respondents requested the Commission to approve the actual capitalization of Rs.

650 Cr. for FY 2019-20 period and also direct APDCL to submit the details of works carried

out under various schemes against the asset addition.

FINER observed that the Hon’ble Uttar Pradesh Electricity Regulatory Commission while

passing the Order for Uttar Pradesh Power Corporation Limited has disallowed 25% of the

Capital Investment of the Discoms on account of failure in taking prior approval from the

UPERC. Further, FINER observed that the Petitioner has not provided Fixed Asset

Register for determining the original cost of Capital Expenditure of projects/ or original cost

of the fixed assets capitalized.

ABITA observed that the capital expenditure and capitalization claims for the MYT period


are not only overstated but also the operational efficiency of implementing such large

capex has never been demonstrated by APDCL in any of the past years. The CWIP of

APDCL has been increasing over the past years and efforts as well as funds should be

channelized towards completion of the ongoing works instead of initiation of new works.

ABITA requested the Commission to direct APDCL for prioritizing its various ongoing

schemes which may yield the desired benefits as opposed to increasing the CWIP.

Response of APDCL

APDCL submitted that all details in regard to capital expenditure vis-à-vis capitalisation is

provide to the Commission. Actual capitalisation as per audited statement of accounts is

to be considered as per the prevailing regulation. Projects capitalized are in strict

conformity with Capital Investment Plan approved by the Commission.

APDCL further submitted that needful steps for expeditious capitalization have been taken

by them in compliance to directives from the Commission, and projections were made

accordingly.

Commission’s View

Noted. The details regarding approved capital expenditure and capitalization are

discussed in the relevant Chapters of this Order.

Issue 8: Depreciation


ABITA submitted that APDCL has claimed a depreciation of Rs. 49.39 Cr. as against the

approved Rs. 17.77 Cr. ABITA requested the Commission to consider the closing assets

of Rs. 2199.70 Cr. along with the actual capitalization (after excluding assets created from

grants and consumer contribution) for FY 2019-20 for the purpose of computation of

depreciation. ABITA proposed depreciation of Rs. 19.79 Cr. in line with methodology

adopted by Commission in March 2020 Order.

ABITA further submitted that APDCL for APR of 2020-21 and revised projection of 2021-

22 has projected higher depreciation of Rs. 42.67 Cr. and Rs. 62.53 Cr. respectively

against approved Rs. 24.22 Cr. and Rs. 23.73 Cr. for FY21 and FY22 respectively.

Response of APDCL

APDCL submitted that it has provided the details of its claim in respective chapter of the

petition.


Commission’s View

The Commission has allowed depreciation after necessary prudence check in accordance

with the MYT Regulations, 2018 as discussed in the relevant Chapters of this Order.

Issue 9: Interest and Finance Charges


ABITA submitted that APDCL has calculated normative Interest on Loan of Rs. 63.76 Cr.

by applying actual rate of interest @10.74% on the closing loan for FY 2019-20. ABITA

highlighted that as per Audited Accounts that the actual interest cost is reduced on account

of conversion of 75% of outstanding loan amount into grant and equity as agreed under

UDAY MoU. Accordingly, 75% of the GoA loan of Rs. 1510.04 Cr. i.e., Rs. 1132.53 Cr. is

converted to grant (Rs. 849.40 Cr.) and Equity (Rs. 283.13 Cr.)

FINER submitted that APDCL has wrongly considered the net closing loan capital instead

of the average loan capital while calculating Interest and Finance Charges for FY 2019-

20, FY 2020-21 and FY 2021-22. FINER sought attention of the Commission that the

Petitioner has not provided any FAR wherein it is not possible to know whether asset are

constructed by Petitioner with its own funds or by consumer contribution and Grants.

ABITA & FINER requested the Commission to carry out prudence check while approving

the interest and finance charges.

CAC submitted that interest and financial charges claimed by APDCL hardly tally with

corresponding figures of the balance sheet. CAC observed that APDCL has become

financially unsustainable without any attempt being made to make a SWOT analysis of the

entity.

Response of APDCL

APDCL submitted that the impact of UDAY was already considered in previous tariff orders

and normative debt amount is computed accordingly.

APDCL submitted that the submission of respondent in regard to consideration of average

loan is noted for correction and requested the Commission to consider interest of Rs. 66.20

Crore against present claim of Rs. 63.94 Crore.

Replying to CAC, APDCL submitted that mere perusal of Actual column of True-up of ARR

for FY 2019-20 will depict the same net surplus/deficit as in the audited balance sheet. It

is general principle that representation of standard accounts in regulatory format


necessitates alignment of various items in different schedules as per regulations.

However, the financial impact remains unaltered.

Commission’s View

The Commission’s analysis regarding Interest and Finance Charges is elaborated in the

relevant chapters of this Order.

Issue 10: Interest on Working Capital


ABITA submitted that APDCL has claimed Rs. 1.90 Cr. towards Interest on Working

Capital for FY 2019-20. The Commission has provisionally approved NIL towards IOWC

in its March 2019 Order and further as NIL in APR in the March 2020 Order. ABITA has

adopted the principles followed by the Commission and proposes IOWC of Rs. 0.70 Cr.

for true-up of FY 2019-20.

FINER submitted that on scrutinizing the audited accounts of APDCL for FY 2019-20, it

has been observed that the value of consumer security deposit is Rs. 851.32crore,

whereas the Petitioner has considered the value at Rs. 685.60 crore excluding the value

of consumer security deposit of Rs. 35.73 crore of the permanently disconnected

consumers, without providing any justification for deviation from the audited accounts. In

addition to above, FINER submitted that the Petitioner while calculating the one month

power purchase cost has deducted the payment made to IEX, as it has been considered

pre-paid in nature which is not as per the methodology followed by the Commission.

CAC opined that interest on working capital is assessed on normative basis and it cannot

be understood whether the interest have really been paid as the same is not reflected in

audited balance sheet.

Response of APDCL

APDCL submitted that detailed calculation of claim is already depicted in the petition and

requested the Commission not to take cognizance of the submission by respondent.

APDCL explained that amount receivable against permanently disconnected consumers

will be recoverable from security deposit only and accordingly the deducted from gross

security deposit available.

APDCL informed that procurement from IEX is on advance basis. Logic of deducting one


month’s power purchase cost is in the premise of liquidity time. Accordingly, the amount

pertaining to IEX is deducted.

Regarding CAC observations, APDCL replied that the submission of respondent seems

diverged from the very concept of the regulation on the parameter. Mere perusal of Note

No. 2.24 of Statement of Accounts will be enough to observe the actual interest paid on

working capital.

Commission’s View

The Commission has computed IoWC in accordance with the MYT Regulations, 2018 and

the same is elaborated in the relevant Chapters of this Order.

Issue 11: Return on Equity


IEX observed that the Petitioner has considered additional ROE on enhancement of equity

to the tune of Rs. 261.29 Cr as a part of the net ARR. However, the Petitioner has

requested the Commission to consider this additional ROE amount during the true-up of

the respective financial year and thus reduced the same amount from the ARR while

computing the tariff change and cost of supply for FY 21-22. However, IEX noted that the

Petitioner has inadvertently included the amount in ARR while working out the wheeling

Charge to be applicable to consumers.

ABITA submitted that APDCL has claimed an amount of Rs. 26.04 Cr. towards RoE for

FY 2019-20. ABITA pointed out that APDCL has still requested to allow RoE on the share

application money pending allotment on account of transfer of trading function, even after,

the matter has been settled several times by the Commission in the past.

ABITA proposed RoE for FY21 and FY22 considering conversion of loan under UDAY-

Rs. 1261 Crore as grant, Rs. 283 Cr. as Equity and Rs. 89 Cr. of share application money,

pending allotment to equity. ABITA requested the Commission to only allow Return on

Equity on the Equity base as per extant audited accounts and on audited financial accounts

for FY 2020-21 and FY 2021-22.

Response of APDCL

APDCL submitted that the respondent has erroneously added the claim of True Up amount

in Table-3 mentioning that the same was considered by the petitioner. However, the


petitioner has not considered the same.

APDCL submitted that no amount is claimed on account of share application money

pending allotment. Moreover, APDCL has not proposed to recover the incremental RoE at

this instant to provide relief to the consumers to that extent.

Commission’s View

Noted. Computation of Return on Equity is discussed in relevant Chapters of this Order.

Issue 12: Revenue Grants/ Surplus


ABITA observed that APDCL submitted revenue subsidy of Rs. 238.95 Cr. to be

considered for true-up of ARR for FY 2019-20. ABITA pointed out that in the books of

accounts for FY 2019- 20, APDCL received total targeted subsidy for consumers on

account of Tariff of Rs.289.86 Cr. from GoA during FY 2019-20. Further, GoA has also

approved Rs. 20 Cr. towards loss funding under UDAY scheme. Thus, APDCL has actually

received total Rs. 548.81 Cr. towards subsidy/ grant for FY 2019-20. ABITA requested the

Commission to check the prudency of these grant/ subsidy booked and account for all the

financial support APDCL has received for FY 2019-20 to true-up the ARR for the period.

Response of APDCL

APDCL replied that amount of Rs. 289.86 Crore was booked as targeted subsidy during

the year and the same was adjusted in the ARR as a part of revenue from sale of power.

Treatment against grant of Rs. 20 Cr. towards loss funding under UDAY scheme received

was adjusted in line with the principles adopted by the Commission in its earlier order. The

same was elaborated in respective chapter of the petition.

Commission’s View

Noted. The computation of subsidy/grant is detailed in relevant Chapters of this Order.

Issue 13: Treatment of Financial Support received under UDAY Scheme


FINER submitted that as per the information available in the Audited Accounts of APDCL


for FY 2019-20, the Govt. of Assam approved an amount of Rs. 20.00 crore towards

‘Operational Fund Requirement (OFR) under the UDAY scheme’ @ 5% of operating loss.

FINER highlighted that any grant provided which does not carry any liability of repayment,

against the expenses already allowed as a part of tariff, should be reduced from the ARR

of the Petitioner.

FINER requested the Commission that Rs. 20.00 crore allowed as a grant by State Govt.

under the UDAY Scheme, for payment of power purchase dues should be disallowed for

determination of True-up for FY 2019-20.

Response of APDCL

APDCL submitted that Operational Fund Requirement (OFR) received under UDAY is

treated in line with earlier consideration of the Commission.

Commission’s View

The treatment regarding OFR Fund has been discussed in the subsequent chapters of this

Order.

Issue 14: ARR and Revenue Surplus/Gap


ABITA proposed revised revenue surplus of Rs. 1191.06 Cr. in FY 2020-21 and Rs.884.28

Cr. in FY 2021-22 respectively and requested the Commission to use the surplus revenue

for rationalizing the tariff of subsidizing consumers like industry, tea & coffee etc. ABITA

further requested the Commission is requested to carry forward the revenue surplus along

with carrying cost as per the regulatory practice and disallow the tariff hike being proposed

for FY 2021-22 by the Petitioner.

Further, ABITA proposed revised Aggregate Revenue Requirement (ARR) for FY22 of Rs

2246.29 Cr as against Rs. 6883.27 Cr projected by the petitioner,

FINER submitted that against the consolidated projected ARR Gap of Rs 1,544.40 crore,

by the petitioner, consolidated revenue surplus of Rs. 146.38 crore should be approved by

the Commission for FY 2021-22 (i.e., after considering the allowable Surplus of Rs. 70.26

crore for FY 2019-20 (True-up) and Rs. 168.19 crore for FY 2020-21 (APR)).


Response of APDCL

APDCL submitted that the respondent has computed the ARR vis-à-vis Cumulative

Revenue Gap on the premise of some arbitrary calculation without any merit. In view of

the above, the Commission is requested to reject the claim of the respondent.

Commission’s View

The ARR and Tariff for FY 2021-22 has been determined in accordance with the MYT

Regulations, 2018 and after necessary prudence check

Issue 15: High Tariff for tea Category


ABITA submitted that the Assam Tea industry produces 52% of the total Indian production;

however, the production in 2020 suffered a major setback due to the COVID -19 pandemic.

ABITA stated that the advisory committee appointed by the Government of Assam has

conducted a study on impact of the COVID on the Tea Industry. As per Committee’s report,

considering average price of Rs. 152.60 per KG, the loss to the Tea Industry is estimated

to be around Rs. 1173 Cr.

ABITA submitted that the existing tariff applicable to the Tea, Coffee Estates/ Plantations

is amongst the highest in the State of Assam. ABITA requested the Commission to disallow

any upward increase in the tariff for Tea, Coffee & Rubber consumer category for FY 2021-

22 as the same will render the affected manufacturing units in the State of Assam as

unviable.

NETA submitted that the proposed Tariff Chart, especially the hike in category Tea, Coffee

& Rubber, and TOD Tariff is highly objectionable, inflated, erroneous, arbitrary, biased,

disconnected from the ground realities of the respondent. NETA observed that unlike Oil

& Coal Sector, the Tea industry runs without significant Govt. Grants and Subsidies.

However, there is no tariff hike proposed in Oil and Coal Sector. NETA pleaded that the

same be reviewed and equated justifiably.

Response of APDCL

APDCL contended that the petitioner entity is also not insulated from the adverse impact

of COVID. APDCL submitted that being sensitive to its consumers, APDCL has proposed

to pass on the benefit received by it through Ministry of Power intervention at this juncture


without deferring till true up.

APDCL submitted that the petitions are prepared as per the principles of governing

regulations and justification on all amounts is specifically mentioned therein. APDCL

submitted that the proposed retail supply tariff tries to rationalise the tariff as well as the

cross-subsidy amongst the various consumer categories while proposing tariffs for the

various consumer categories.

Commission’s View

Noted.

Issue 16: Increase in Fixed & Energy Charges


ABITA submitted that APDCL has again proposed an abrupt increase in fixed and energy

charges across various categories to cover the erroneous computation of revenue gaps

for FY 2021-22. ABITA has already worked out ARR in accordance with the principles as

per previous tariff orders and there should be huge amount of surplus in FY 2021-22.

ABITA submitted that the element of cross-subsidy in HT tariff can further be reduced in

view of this surplus available.

ABITA further submitted that that the proposed increase of Rs. 30/kVA/month in fixed

charges and 50 paisa per unit increase in energy charges is exorbitantly high increase

(+8%) to Tea, Coffee & Rubber consumer category, which will unnecessarily burden the

consumers and badly affect the viability of the industry.

FINER submitted that the power tariff in Assam, is among top 5 in India. In the wake of

Advantage Assam, done by Govt of Assam, it won’t be lucrative for any industry to have

a plant here, if the power prices are on such a high. Therefore, the Commission should

not increase the power price increase further, but rather device means to bring this price

down, which shall ultimately help development of the State.

NESSIA submitted that with the power interruptions, unscheduled load shedding and poor

quality of power existing in different areas of the State, increase of fixed charge is not

justified. NESSIA further submitted that for HT Small Sector Industries upto 50 KVA even

the existing fixed charge is on a higher side. NESSIA requested the Commission to reduce

fixed charges for the Domestic and Small Industry categories.


NESSIA observed that APDCL and the Commission should insist Govt. of Assam for

additional funding as grant on regular basis to bail out the crisis of APDCL.

GSS during the public hearing submitted that there were frequent power interruptions and

unscheduled load shedding and therefore, claim for increase in fixed and energy charges

was unjustified.

Response of APDCL

APDCL submitted that Operation and Maintenance cost of electricity infrastructure has

been increasing manifold due to price rise of all commodities which determine the cost of

supply in distribution sector. APDCL submitted that estimated fixed cost of around 54%,

only 24% recovery is proposed in the form of fixed charges. The proposal was submitted

in the premises of improved supply conditions to tea gardens.

APDCL submitted that the petition did not consider any Government subsidy. However,

in case Government provides some subsidy to keep the tariff at a reasonable level like

previous years, the Commission will consider the same at the time of fixation of tariff.

Commission’s view

Noted.

Issue 17: Power Quality


NETA submitted that as Power Supply is very erratic, the respondent has to depend on

captive power generation, which unnecessarily increases expenses of the consumer, at

the same time the Petitioner themselves creates loss to its Revenue.

Response of APDCL

APDCL submitted that the supply quality to tea gardens have significantly improved over

the years.

Commission’s view

Noted. APDCL should take measures to improve power quality.


Issue 18: Determination of Tariff based on Voltage-wise Cost of Supply


ABITA & FINER requested the Commission to determine tariff based on voltage-level cost

of supply. This would enable cost reflective tariff in the State.

ABITA submitted that the existing voltage-wise cost of supply may be based on number

of assumptions but unless the Commission would implement the same, the Petitioner

would not be providing sufficient information in this regard.

FINER submitted that the proposed tariff increases by APDCL are higher for the already

subsidizing consumers. This shall further create an imbalance in the various tariff

categories and shall be against the principles laid down in the Tariff Policy. Therefore, the

tariff proposed by APDCL for the HT categories of consumers ought to be examined in

detail and a proper and viable tariff ought to be fixed by the Commission.

Response of APDCL

APDCL submitted that it has no issue on VCoS based tariff in principle subject to adequate

commercial safeguard to the utility. However, with typical consumer mix of Assam vis-à-

vis rationalisation of tariff as per Tariff policy and purchasing power parity, the same will

be very challenging at this juncture. Adequate metering arrangement projects is

undertaken for proper determination of VCoS. Therefore, it would not be appropriate to

determine tariffs on the basis of VCoS at this point in time.

APDCL further submitted that being a utility, APDCL has its limitation and guided by laid

down principles, policy, regulations etc. However, with massive domestic consumer base

with low purchasing power, APDCL has tried to balance amongst all categories.

Commission’s view

Noted.

Issue 19: Temporary Disconnection


FINER proposed that consumers should be allowed to get into temporary disconnection

of load, with a minimum period of 1 month and maximum period of 3 months, after giving

a 30 days’ notice. This can be allowed once a year maximum. During this time, no charges

should accrue to the consumer. This is basically, with regard to distressed industrial and


commercial consumers, who has to bear cost of fixed charges, irrespective of whether

they run the unit or not.

Response of APDCL

APDCL submitted that such proposition may lead to load volatility vis-à-vis excess fixed

charge burden on power under agreement. All these costs will ultimately be part of retail

tariff only.

Commission’s view

Noted.

Issue 20: CAG Report & Independent Auditor’s Report


FINER submitted that it is mandatory for APDCL to submit audited accounts including

C&AG report along with the Petition for truing up. However, APDCL has filed the Petition

based on provisional accounts. FINER submitted that true up of FY 2019-20 should be

conducted only after the audited accounts and C&AG’s report has been filed.

Response of APDCL

APDCL replied that Statutory Auditor’s report has been provided to the Commission as

per stipulated timeline. CAG audit is underway and report of the same will be made

available on receipt.

Commission’s View

The Petitioner submitted the Audited Accounts for FY 2019-20 on 15th January, 2021.

Accordingly, the Commission has considered these Audited Accounts for the purpose of

Truing Up of FY 2019-20.

Issue 21: Power factor Rebate


FINER submitted that several states levy penalty for low power factor on industries and

provide incentives for achieving higher power factor. FINER observed that for other States


the incentive is provided in steps for every 1% increase in power factor beyond 95%.

FINER opined that the industrial consumers should be incentivized more, as is being done

in the other States, by providing rebate for every 1% increase beyond 95% power factor

instead of just 2% rebate between 95%-100%. FINER requested the Commission that a

similar concept may be accepted for industrial consumers of APDCL.

Response of APDCL

APDCL submitted that being a regulated utility, APDCL is complying with the regulations

and admissible rebates are allowed.

Commission’s View

Noted.

Issue 22: Load factor Rebate


FINER submitted that many distribution companies in India, have started giving a load

factor rebate for maintaining an above average load by the unit. This helps the Discom in

planning the load requirement and optimum utilization of resources may happen, with

negligible shortages. The industry on the other hand gets incentivized to maintain a high

load factor, and thereby increasing efficiency and performance of the system.

Response of APDCL

Being a regulated utility, APDCL will comply with any such rebate allowed by Hon’ble

Commission after thorough deliberation.

Commission’s View

Noted.

Issue 23: Peak Load Shedding


FINER submitted that during Peak load, there is sometimes shedding for 3-6 hours for an

industry in a day, however the fixed charge is being charged in full from the consumer.


FINER submitted that, the fixed charges per unit shall be pro-rated, as per every available

during a day or a month.

FINER further submitted that in Assam, load shedding for industries happens during peak

load, due to this maintaining high power factor becomes difficult. It shall be imperative

that, APDCL provided the necessary power during peak load hours also, so that the

industrial consumers can maintain better Power factor, and get incentivized for

maintenance of better PF.

Response of APDCL

APDCL submitted that some generic submission of load shedding without any

substantiation doesn’t warrant any response. However, the respondent is free to move

competent APDCL authority with specific case details for redressal. Pro-rata billing of

fixed charge is done as per the regulation.

Commission’s View

Noted.

Issue 24: Timely payment & Bank Guarantee


FINER submitted that the consumers should be given a discount for timely payment of

dues so as to improve the cash flow of the Company.

FINER also submitted that Bank Guarantee be allowed to be given as security deposit for

any consumer.

Response of APDCL

APDCL submitted that submission of respondent calls for amendment in prevailing

regulations and beyond the scope of the instant petition.

Commission’s View

The requirement of giving security deposit in cash is as per the AERC (Electricity Supply

Code) Regulations, 2017. Any change would require amendment of the relevant

provisions of the aforesaid Regulations after necessary previous publication of the

proposed amendment.


Issue 25: Separate Tariff Category for Cold Storage Units


FINER submitted that currently APDCL has three tariff categories related to

agriculture/irrigation with no category made for cold storage units. Thus, currently all such

cold storage units are subjected to high industrial tariff. FINER submitted that in order to

encourage the local agricultural and food industry it is essential that a separate tariff

category be created for cold storage units.

Response of APDCL

APDCL submitted that the Commission may consider with detailed submission to assess

the tariff implication.

Commission’s View

In view of the Government Policy advocating simplification of tariff categories, the

Commission has decided not to introduce any new tariff category at present.

Issue 26: Cross Subsidy and Cross Subsidy Surcharge


ABITA submitted that the domestic and other LT consumers continue to remain highly

cross-subsidized. Therefore, the HT and industrial consumers are required to bear the

burden in absence of adequate tariff subsidy by the State Government to the

economically weaker sections like Jeevan Dhara or domestic consumers for which the

tariffs are considerably 27% and 16% below the average cost of supply respectively.

Cross subsidy Surcharge (CSS) is worked out by the Commission as the difference

between the ACoS and ABR of a particular category. IEX stated that the Petitioner in its

submission while computing the Avg. Cost of Supply has made an inadvertent summation

error while calculating the total ARR. Based on the corrected calculation of the Net ARR,

the ACoS comes out to be Rs. 8.29/ unit and not Rs. 8.23/ unit.

Response of APDCL

APDCL submitted that the tariff proposal is made with due care to keep the cross-subsidy

levels within ±20% to the extent possible.


Replying to IEX, APDCL submitted that calculation of the petitioner is correct.

Commission’s View

Noted.

Issue 27: Interest on Consumer Security Deposit


ABITA submitted that APDCL in its petition has claimed Rs. 38.06 Cr. towards interest on

consumer security deposit (CSD) for truing up of FY 2019-20. ABITA submitted that

APDCL has mentioned in the petition that Rs. 57.84 Cr. will be liquidated subsequently

with energy bills and actual payment during the years is Rs. 27.26 Cr, however, there is

no clarity regarding actual payment. In view of the same, ABITA proposed to keep the

Interest on CSD same as already approved by the Commission in prior two Orders.

FINER submitted that the Petitioner in FY 2019-20 has requested the Commission to

allow the interest liability on consumer security deposit as per the audited statement of

accounts, which is to the tune of Rs. 65.32 crore, whereas the actual payment made

during the year is only Rs.38.06 crore. FINER requested that the Petitioner’s plea for

allowing unpaid interest expenses on CSD should not be accepted.

Response of APDCL

APDCL submitted that the claim is made on the basis of actual payment as per annual

statement of accounts duly certified by auditors.

Commission’s View

The Commission has been allowing payment as per actual against the interest on

consumer security deposit in the ARR.

Issue 28: Special Tariff at 132 kV


FINER submitted that instead of proposing endless capital expenditure, the Distribution

Company should work on the transmissions lines in Assam to be upgraded to 132 KV

level, for the industrial consumers.

The EHT category is very much a reality and consumers desire to take power at 132 KV

level. However, as the tariff is not known, it is a detriment to consumers to not upgrade to

132 KV.


Response of APDCL

APDCL submitted that the Commission may consider with detailed submission to assess

the tariff implication.

Commission’s View

Noted. The Commission has already allowed a rebate of 1.5% on energy charge for

consumers availing power at 33 KV and 3% on energy charge for consumers availing

power at 132 KV and above.

Issue 29: Computation of Average Billing Rate


IEX observed that the Petitioner has proposed an increase in the average billing rate for

the HT industries-II category by Rs 1.50/ unit against the approved ABR for FY 2020-21

(almost 18% increase).

IEX requested the Commission to kindly assess the proposed increase of more than Rs.

1.5/ unit in the ABR of industries since the same will impact the operation of industries.

IEX also requested that the Commission may consider above submissions while

computing the Cross Subsidy Surcharge.

Response of APDCL

APDCL replied that the proposed retail supply tariff of APDCL for FY 2021-22 has been

guided by the provisions of the EA 2003, National Electricity Policy (NEP), Tariff Policy

and the MYT Regulations, 2018. It has tried to rationalise the tariff as well as the cross-

subsidy amongst the various consumer categories while proposing tariffs for the various

consumer categories. The proposed tariff for FY 2021-22 is designed so as to keep the

tariffs of most categories are within ±20% of the ACoS, while at the same time it was also

ensured that no category is faced with a tariff shock to the extent possible.

Commission’s View

The matter is discussed in the Tariff Section of this Order.


Issue 30: Dedicated feeders


NETA submitted that the works pertaining to dedicated feeders which were long approved

for Tea Estates and Bought Leaf Tea Factories have been moving at the pace of a

tortoise. NETA further submitted that since the cost is to be borne by the consumer, yet

the initiation and formalities are not taken seriously, for which not only the Tea Industry

has to suffer drastically, but APDCL too loses its prospective revenue by potentially

providing uninterrupted power supply through dedicated feeders.

Furthermore, the respondent submitted that transformer maintenance cost has to be also

borne by the respondent. NETA submitted that the clearances of the transmission lines

too are done at the cost of the consumers. NETA observed that yet APDCL proposes a

hike in fixed charges without providing due service upkeep.

NETA further requested the Commission to provide for conducting a field audit, and

determine whether the transmission lines under various rural electrification schemes are

built as per the original layout as there are recurrent faults in the transmission lines which

result in lower revenue generation for the APDCL.

Response of APDCL

APDCL replied that construction of dedicated tea feeders are carried out under various

projects funded by State Government (UDAY/SOPD/Annual Plan etc.) as well as EAP.

The Commission has constituted a Monitoring Committee to review the progress of

various projects periodically. The Committee also includes member from tea industry. The

respondent may approach competent authority(s) of petitioner in case of any specific

issue.

Commission’s View

Noted.

Issue 31: Overview of the Power Sector in Assam


CAC submitted that In the course of electricity reform the past government liability of

erstwhile ASEB was converted into equity of three companies viz APDCL, AEGCL and


APGCL. Assets were apportioned and fresh finance was infused as 90% grant and 10%

loan to the companies. However, the state of affairs of the companies today after almost

two decades of initiation of the process is not at all encouraging. APDCL has landed in

such a position that it could hardly manage its ARR without huge government subsidy.

Consumers are suffering due to failure of APGCL to supply cheaper thermal power to

APDCL. AEGCL with limited market has been functioning in a better position although it

has also failed to adhere to voltage regulation, transmission loss norms etc.

In such a situation, CAC suggested that a common road map for all the companies has

become the need of the hour with a common leadership at the top.

In view of the above, the Consumer Advocacy Cell requested the Commission to initiate

a technical and financial study to find out the real state of affairs of the entities and

undertake concrete corrective measures within a specific time frame. CAC observed that

even if tariff as claimed by APDCL in the instant petition is approved, there is hardly any

scope that APDCL would not claim for more subsidies in the next financial year to meet

up its annual revenue requirement. Therefore, the State Government intervention is

indispensable to revitalize the power utilities of Assam. CAC requested the Commission

to send an advisory to the Government of Assam to take action in this regard for the best

interest of the entities and the people of the State.

Response of APDCL

APDCL appreciated the submission of the respondent. APDCL admitted that power sector

in Assam is yet to be self-sufficient as envisaged at the time of reform process. However,

the picture as presented by the respondent is not so gloomy. After the reforms, the

petitioner utility has been able to expand its network to the last mile to cater the demand

of people at every nook and corner of the State. As per the 7th Integrated Rating of State

owned Discoms, APDCL is ranked 17th out of 41. APDCL is making all earnest efforts

within its limited resources to improve its performance and become one of the efficient

utilities in the country.

APDCL submitted that it submitted the petition without factorising any Government

subsidy. However, in case Government provides some subsidy to keep the tariff at a

reasonable level like previous years, the Commission may consider the same at the time

of fixation of tariff.

Commission’s View

Noted.


4 Truing up for FY 2019-20

4.1 Methodology for Truing Up

4.1.1 The Commission had approved the ARR for APDCL for FY 2019-20 in the Tariff Order

dated March 01, 2019.

4.1.2 APDCL submitted the Petition on November 28, 2020 seeking True-up for FY 2019-

20. APDCL submitted the Audited Accounts duly audited by the Statutory Auditor on

January 15, 2021.

4.1.3 The Commission approved the cost parameters through approval of the ARR of FY

2019-20 at the beginning of the year, keeping in view the data available at that point

of time. The cost approvals for each of the items were based on projection of expenses

and revenue before beginning of the year and the provisions of MYT Regulations,

2018, wherever applicable.

4.1.4 The actual cost/values for certain elements/parameters may vary as against the

approved cost during the year due to various controllable and uncontrollable factors.

The Licensee may end up with higher or lower expenditure, as the case may be, at the

end of the year as against the approved cost.

4.1.5 The Commission analyses the actual expenditure for the previous year based on the

audited Annual Accounts of the Licensee and allows/disallows the recovery of the

actual expenditure through the ensuing year’s tariff, subject to prudence check.

4.1.6 In this Chapter, the Commission has carried out the Truing up for FY 2019-20 based

on the submissions of APDCL, audited annual accounts for FY 2019-20 and provisions

of MYT Regulations, 2018.

4.1.7 In this Chapter, the Commission has analysed all the elements of actual expenditure

and revenue of APDCL for FY 2019-20 and undertaken the truing-up of expenses and

revenue in accordance with Regulation 9.1 of the MYT Regulations, 2018. The

Commission has approved the sharing of gains and losses on account of controllable

factors between APDCL and the consumers, in accordance with Regulation 12 of the

MYT Regulations, 2018.


4.2 Energy Sales

4.2.1 APDCL submitted the category-wise energy sales in its Truing Up Petition and stated

that the actual sales were 7257 MU as against approved sales of 7930 MU, as shown

in the Table below:

Table 7: Energy Sales for FY 2019-20 as submitted by APDCL (MU)

Category Name MYT Order dtd

01.03.2019

APDCL Submission

LT GROUP

Jeevan Dhara 0.5 kW &1 kWh/day 819 403

Domestic A-0.5 kW up to 5 kW 3364 3036

Domestic-B -5 kW up to 25 kW 336 358

Commercial Load up to 25 kW 680 757

General Load up to 25 kW 99 135

Public Lighting 13 16

Agriculture up to 25 kW 26 32

Small Industries Rural up to 25 kW 73 79

Small Industries Urban up to 25 kW 30 34

Temporary Supply 9 6

LT TOTAL 5449 4856

HT GROUP

HT Domestic above 25 kW 31 21

HT commercial above 25 kW 382 355

Public Water Works 71 80

Bulk Supply Govt. Edu Inst 76 76

Bulk Supply Others 391 380

HT Small Industries above 25 kW (30 kVA) and up to 50 kVA 23 18

HT Industries-1 50 kVA to 150 kVA 67 93

HT Industries-II above 150 kVA 798 850

Tea, Coffee &Rubber 550 447

Oil & Coal 76 65

HT Irrigation Load above 25 kW (30 kVA) 15 15

HT Electric Crematorium 0.5 0

HT Total 2481 2401

TOTAL 7930 7257

APDCL submitted that the actual total sales are lower by 8% vis-à-vis energy sales

approved as per the Tariff Order dated 1 March, 2019. However, the total sales in FY

2019-20 is 4% higher than the sales in FY 2018-19. Such deviation is primarily driven

by significantly lower consumption by Jeevan Dhara and Domestic-A category as

compared to the approved sales.


4.2.2 APDCL further submitted that the decline in consumption of Jeevan Dhara and

Domestic-A category is due to the impact of distribution of Energy Efficient appliances

at subsidised rates under Ministry of Power flagship programme(s) like Domestic

Efficient Lighting Programme (DELP)/Unnat Jyoti by Affordable LEDs for ALL (UJALA).

Such endeavour has also facilitated significantly in Peak Load Management to the

extent of around 150 MW.

Commission’s Analysis

4.2.3 On scrutiny of the actual Energy Sales submitted by APDCL for FY 2019-20, the

Commission observed that APDCL has reported a substantial reduction in Energy

Sales to Jeevan Dhara category. APDCL has linked the reduction in sales to the

distribution of energy efficient appliances under various schemes. The Commission, in

its previous Orders, has repeatedly stressed on the over-estimation of sales to the

Jeevan Dhara category, and has also highlighted discrepancies in the number of

consumers and sales reported by APDCL to this category.

4.2.4 In FY 2019-20, APDCL has reported significant migration of Jeevan Dhara category

consumers to Domestic A category, once their consumption exceeds the ceiling of 30

units per month. APDCL has shown net addition of 1,23,244 Jeevan Dhara consumers

from April to July 2019, while the net switchover from Jeevan Dhara category to

Domestic A category has been shown as 1,68,359 consumers, from August 2019 to

March 2020. The sales presently reported by APDCL to Jeevan Dhara category are

more logical, as the average consumption works out to 21 units per month for each

consumer as against the ceiling of 30 units per month per consumer.

4.2.5 The Commission has hence, approved the Energy Sales in the truing up for FY 2019-

20, as submitted by APDCL, as shown in the Table below:

Table 8: Energy Sales for FY 2019-20 approved by the Commission (MU)

Category Name MYT Order dt

01.03.2019

APDCL Submission

Approved after

True-up

LT GROUP

Jeevan Dhara 0.5 kW &1 kWh/day 819 403 403

Domestic A 3,364 3,036 3,036

Domestic-B -5 kW up to 25 kW 336 358 358

Commercial Load up to 25 kW 680 757 757

General Load up to 25 kW 99 135 135

Public Lighting 13 16 16

Agriculture up to 25 kW 26 32 32


Category Name MYT Order dt

01.03.2019

APDCL Submission

Approved after

True-up

Small Industries Rural up to 25 kW 73 79 79

Small Industries Urban up to 25 kW 30 34 34

Temporary Supply 9 6 6

LT TOTAL 5,449 4,856 4,856

HT GROUP

HT Domestic above 25 kW 31 21 21

HT commercial above 25 kW 382 355 355

Public Water works 71 80 80

Bulk Supply Govt. Edu Inst 76 76 76

Bulk Supply Others 391 380 380

HT Small Industries above 25 kW (30 kVA) and up to 50 kVA 23 18 18

HT Industries-1 50 kVA to 150 kVA 67 93 93

HT Industries-II above 150 kVA 798 850 850

Tea, Coffee &Rubber 550 447 447

Oil & Coal 76 65 65

HT Irrigation Load above 25 kW (30 kVA) 15 15 15

HT Temporary - - -

HT Electric Crematorium 0.5 - -

HT Electric Vehicle Charging Station - - -

HT Total 2,481 2,401 2,401

TOTAL 7,930 7,257 7,257

Accordingly, the Commission approves the total energy sales of 7,257 MU in the

Truing up for FY 2019-20.

4.3 Distribution Loss

4.3.1 APDCL, in its Petition, submitted that it has achieved distribution loss level of 19.06%

in FY 2019-20, as against the approved level of 16%.

4.3.2 APDCL submitted that over the years, it has been able to reduce the losses gradually,

except in FY 2009-10, FY 2011-12 and FY 2018-19. APDCL stated that the increase

in Distribution Losses in these years are primarily on account of enhancement of Low

Tension (LT) networks under RGGVY/DDUGJY without adequate High Tension (HT)

infrastructure. Further, in FY 2018-19, due to implementation of massive household

electrification carried out under Govt. of India’s flagship programme SAUBHAGYA, the

losses increased.

4.3.3 APDCL submitted that the ratio of primary line length to its concerned secondary


distribution line length is one of the important factors that influence the performance of

primary distribution. Over the years, large scale rural electrification programme has

resulted in considerable expansion of LT distribution network. The size of the

distribution transformers has been constantly increasing. As a result, the length of LT

lines/circuits is also increasing, resulting in high losses in LT lines, excessive voltage

drops, frequent faults on LT network and higher rate of failure of distribution

transformers. The LT-HT ratio of APDCL in terms of distribution infrastructure is 3.17:1

against the desired ratio of 1:1.2.

4.3.4 APDCL further submitted that the manpower strength of APDCL is badly affected with

pendency of recruitment processes initiated during 2018 due to various litigations.

Meanwhile, consumer base vis-à-vis infrastructure has experienced a huge surge

particularly due to SAUBHAGYA. The number of employees per thousand consumers

has significantly dropped from 2.95 in FY 2016-17 to 1.41 in FY 2019-20, with

implementation of SAUBHAGYA.

4.3.5 APDCL added that due to manifold increase in LT consumers, deferred implementation

of various schemes as per the approved Capital Investment Plan, inverse LT:HT ratio,

age of assets and restricted allowance of Repair & Maintenance (R&M) expenses,

APDCL is not able to maintain the Distribution Loss levels.

4.3.6 APDCL submitted that considering the actual distribution loss levels of previous years,

manifold increase in LV consumers, deferred implementation of various schemes as

per the approved Capital Investment Plan, age of assets, restricted R&M allowance as

per the MYT Regulations,2018 and inverse HT:LT ratio, the actual Distribution Loss of

19.06% should be approved in the true-up for FY 2019-20.


4.3.7 The Commission had approved the Distribution Loss of 16% for FY 2019-20 in its MYT

Order dated March 01, 2019.

4.3.8 The Commission had approved distribution loss of 16.85 % at the time of Truing-up of

FY 2018-19, as against the actual Distribution Loss of 19.70%. APDCL has now

reported a reduction in Distribution Loss level to 19.06% for FY 2019-20 as compared

to actual Distribution Loss in FY 2018-19.

4.3.9 The Commission also sought information on circle-wise distribution losses from


APDCL, which was submitted by APDCL. From this data, it can be seen that apart

from the 5 Circles of Guwahati – I, Guwahati – II, Rangia, Marigaon, and Tezpur, all

the remaining 14 Circles have reported Distribution Losses higher than the approved

level of 16%. The simple average of Distribution Losses in these 14 Circles is 23.92%,

with the reported Losses as high as 35.36% in Badarpur, followed by Kokrajhar with

32.81%, and Bongaigaon with 28.12%. This clearly shows that there is scope for lot of

improvement in terms of Distribution Losses, and APDCL should not maintain that the

Losses are already very low and that it is difficult to reduce it further.

4.3.10 Further, it can be observed that the contention of APDCL regarding worsening HT:LT

ratio resulting in increase in Distribution Losses, is not borne out by APDCL’s own

reported performance over the last 3-4 years. Though HT:LT ratio has steadily

worsened, APDCL has reported reduction in Distribution Losses in most of the years.

4.3.11 Distribution Loss being a controllable parameter as elaborated in the MYT Order

dated 01.03.2019 of the Commission, the Distribution Loss level is kept at the

approved level of 16.00% for truing up of FY 2019-20. 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

discussed subsequently in this Chapter.

4.4 Energy Requirement

4.4.1 APDCL submitted that the total energy requirement for sale of 7257 MU to retail

consumers and considering 1520 MU of surplus energy sale outside the State in FY

2019-20 was 10941 MU excluding Open Access consumption, against the approved

energy requirement of 10093 MU. The energy requirement has been computed based

on the actual sales, actual Distribution Losses, actual inter-State and intra-State

Transmission Losses, and surplus energy sale outside the State, as shown in the Table

below:

Table 9: Energy Requirement for True-Up for FY 2019-20 as submitted by APDCL (MU)

Sl.

No. Particulars

MYT

Order dt.

01.03.2019

APDCL

Submission

1 Energy Sales 7,930 7,257

2 Distribution Loss (%) 16.00% 19.06%

3 Energy Requirement at Distribution periphery 9,440 8,966

4 Intra-State (AEGCL) Transmission Loss (%) 3.39% 3.46%

5 Energy input to Transmission System 9,771 9,287


Sl.

No. Particulars

MYT

Order dt.

01.03.2019

APDCL

Submission

6 Sale of Surplus Energy outside the State 182 1,520

7 Inter-State (PGCIL) Pooled Loss (%) 1.40% 1.42%

8 Total Energy Requirement 10,092 10,941


4.4.2 The Commission has approved the energy requirement on the basis of approved

sales, approved Distribution Losses, actual Transmission Loss of AEGCL for FY 2019-

20, and proportionate PGCIL Losses on external power purchase for the respective

year.

4.4.3 The Commission sought SLDC verification for the intra-State Transmission Loss.

SLDC, vide its communication dated 26 January, 2021, submitted that the energy

accounting for FY 2019-20 has been reconciled with APDCL, and the verified intra-

State Transmission Losses for FY 2019-20 are 3.46%. The Commission has

considered the actual Transmission Loss of AEGCL for FY 2019-20, as against the

approved transmission loss for FY 2019-20, for approving the energy requirement for

APDCL. The Commission is of the view that APDCL should not be penalized for non-

achievement of approved Transmission Loss by AEGCL.

4.4.4 It may be noted that the actual quantum of Surplus Power sold outside the State has

been considered while computing the Energy Balance, and the revenue from the same

has been considered under Other Income, as discussed subsequently in this Order.

4.4.5 The gross Energy Requirement approved by the Commission in the truing up for FY

2019-20 is shown in the following Table:

Table 10: Energy Requirement approved by the Commission after True-Up for FY 2019-

20 (MU)

Sl.

No. Particulars

MYT Order

dtd

01.03.2019

APDCL

Submission

Approved

after

True-up

1 Energy Sales 7,930 7,257 7,257

2 Distribution Loss (%) 16.00% 19.06% 16.00%

3 Distribution Loss (MU) 1,510 1,709 1,382

4 Energy Requirement at Distribution periphery 9,440 8,966 8,639


Sl.

No. Particulars

MYT Order

dtd

01.03.2019

APDCL

Submission

Approved

after

True-up

5 Intra-State (AEGCL) Transmission Loss (%) 3.39% 3.46% 3.46%

6 Intra-State (AEGCL) Transmission Loss (MU) 331 321 310

7 Energy input to Transmission System 9,771 9,287 8,949

8 Sale of Surplus Energy outside the State 182 1,520 1,520

9 Inter-State (PGCIL) Pooled Loss (%) 1.40% 1.42% 1.42%

10 Inter-State (PGCIL) Pooled Loss (MU) 139 134 130

11 Total Energy Requirement 10,092 10,941 10,597

Therefore, the Commission approves Energy Requirement of 10,597 MU for sale

of 7257 MU to retail consumers in the truing up for FY 2019-20.

4.5 Power Purchase

4.5.1 APDCL submitted that power procurement of APDCL is predominantly dependent on

the State Generating Stations of Assam Power Generation Company Limited (APGCL)

and Central Sector Generating Stations (CSGS) to meet its base load. Around 31 %

of power is allocated from hydro power stations with seasonal volatility. In order to

meet the peak demand of the State, APDCL was required to procure additional power

on short-term basis through Traders and from Power Exchanges.

4.5.2 APDCL submitted that it has incurred an amount of Rs.5530.19 Crore against the

approved power purchase cost of Rs.4722.41 Crore for FY 2019-20. APDCL

purchased 10940.85 MU as against 10092.21 MU approved in the Tariff Order.

4.5.3 APDCL submitted the following reasons for increase in power purchase cost:

a) 8% increase in quantum with respective cost increase by 17% over approved

level.

b) Significant variation in performance of APGCL, as APGCL has contributed only

13% of energy requirement of APDCL against approved 22%.

c) Lower energy generation by APGCL not only led to higher cost of APGCL, but

also procurement of power from other Bilateral Sources / Power Exchanges at

average price of Rs. 4.21/kWh, which is 42% costlier, with added losses.

d) Although performance of CSGS was better than the approved level, higher

generation from costlier stations like NTPC Bongaigaon and unfortunate


stoppage of cheapest stations of NEEPCO Kopili has added to the cost.

e) Commissioning of Mangdechu HEP (Bhutan) with higher than average

approved tariff has added to the cost after adjustment with tariff approved for

Nikachchu.

f) PGCIL charges have increased by 44% over approved level.

4.5.4 Rebate on timely payment of power purchase of Rs.25.47 Crore has been considered

under the head of ‘Other Income’. The following Table shows the power purchase

quantum and cost claimed by APDCL in its Petition:

Table 11: Power Purchase for FY 2019-20 as submitted by APDCL (MU)

Sl. No.

Agency/Source FY 2019-20

MYT Order dt. 01.03.2019 APDCL Petition

Quantum (MU)

Total Cost (Rs

Cr)

Rs/kWh Quantum (MU)

Total Cost (Rs

Cr)

Rs/kWh

1 APGCL 2,337.57 706.70 3.02 1,497.90 498.21 3.33

2 NEEPCO (HYDRO) KOPILI I 422.79 44.78 1.06 380.80 42.35 1.11 KOPILI II 51.76 6.43 1.24 53.32 3.17 0.59 KHANDONG 111.29 17.59 1.58 102.89 8.70 0.85 RHEP 548.20 88.73 1.62 550.91 123.76 2.25 DHEP 97.97 45.53 4.65 74.98 42.91 5.72

KAMENG 225.41 99.61 4.42

3 NEEPCO (TH)

AGBPP 788.12 292.07 3.71 938.43 379.56 4.04 AGTPP 176.61 79.81 4.52 336.91 142.85 4.24 AGTPP-2 84.05 13.46 1.60

4 NHPC Existing Lg HEP 216.58 57.73 2.67 102.35 45.21 4.42

5 NTPC (Existing) FARAKKA 229.30 80.38 3.51 227.30 92.06 4.05 KAHELGAON - I 111.51 57.52 5.16 114.60 40.75 3.56 KAHELGAON -II 469.42 146.06 3.11 492.27 164.19 3.34 TALCHER 151.07 34.65 2.29 184.68 41.52 2.25

6 NTPC (New) BTPS 1,530.58 959.03 6.27 2,691.97 1,594.38 5.92

NTPC BTPS III 565.87 354.57 6.27

7 MeECL 2.17 1.55 7.14 0.04 0.01 2.50

8 Pare HEP 128.35 54.35 4.23 187.83 94.56 5.03

9 Suryatap Solar 4.19 3.68 8.78 6.06 5.32 8.78

11 JNNSM Bundled Solar power

8.74 10.38 11.88 7.74 9.61 12.42

12 SECI Solar 34.95 22.63 6.47 38.39 23.77 6.19

13 JNNSM Bundled Coal power

35.09 9.80 2.79 51.68 19.77 3.83

14 Bilateral Sources/Traders

627.20 269.67 4.30

15 Power Exchanges 504.82 206.78 4.10

16 OTPC 1,388.14 469.41 3.38 1,252.27 392.39 3.13


Sl. No.

Agency/Source FY 2019-20

MYT Order dt. 01.03.2019 APDCL Petition

Quantum (MU)

Total Cost (Rs

Cr)

Rs/kWh Quantum (MU)

Total Cost (Rs

Cr)

Rs/kWh

17 HHPCPL (Champawati) 14.66 6.33 4.32 5.35 2.20 4.11

18 Wind Power PTC 87.16 30.77 3.53 86.85 30.66 3.53

19 SECI Wind 87.16 23.71 2.72 75.98 20.67 2.72

20 Mangdechhu 207.13 96.64 4.67

21 PTC Nikachu 139.81 58.05 4.15

22 SPV Assam 43.69 14.53 3.33

23 Power Swapping Arrangement 7.19 0.19 0.26

Sub-total: 10,092.21 3,789.84 3.76 10,807.84 4,391.86 4.06

24 REC (Solar) 24.75 40.70

25 REC (Non-Solar) 5.96 -

26 Deviation Settlement Mechanism

132.98 73.91 5.56

Sub-total: 10,092.21 3,820.55 3.79 10,940.82 4,506.47 4.12

27 AEGCL Cost 360.84 251.00 0.23

28 SLDC Charges 3.85

29 PGCIL Transmission Charges

537.18 772.71

TOTAL 10,092.21 4,722.42 4.68 10,940.82 5,530.18 5.05

30 Less: Delayed Payment Charge

4.83

Net Power Purchase 10,092.21 4,722.42 4.68 10,940.82 5,525.35 5.05


4.5.5 The Commission has reconciled the amounts shown by APDCL as cost of power

purchase from APGCL and Transmission Charges payable to AEGCL, against the

amount of revenue shown by APGCL and AEGCL, respectively, for FY 2019-20. The

Commission observed that there are certain differences in the amounts claimed as

expenses by APDCL and the amounts shown as revenue by APGCL and AEGCL,

respectively. This difference is due to difference in revenue/cost recognition methods

adopted by APGCL, AEGCL and APDCL, with APGCL and AEGCL considering

revenue based on bills raised, while APDCL considers cost based on bills accepted.

4.5.6 As the true-up for APGCL, AEGCL and SLDC has been done by considering the

Revenue reported in their Audited Accounts for FY 2019-20, the Commission has

considered the amounts shown as revenue by APGCL, AEGCL, and SLDC as the cost

of power purchase from APGCL and the Transmission Charges paid/payable to

AEGCL, respectively. Similarly, the quantum of net generation shown by APGCL has


been considered as the net purchase by APDCL from APGCL. The Commission has

consistently been following this approach in the true-up of respective years, and over

the years, the differences will even out.

4.5.7 The Commission has not considered the Delayed Payment Charge of Rs. 4.83 Crore,

as recorded in the Audited Accounts of FY 2019-20, as the Delayed Payment Charge

is a penal payment and cannot be passed on to the consumers. The treatment of the

rebate earned by APDCL on timely payment of power purchase bills has been

elaborated under the head of ‘Other Income’.

4.5.8 The remaining source-wise purchases have been accepted as submitted by APDCL.

The summary of power purchase quantum and cost approved after true-up for FY

2019-20, is summarized in the Table below:


Table 12: Power Purchase approved by the Commission after True-Up for FY 2019-20

Sl. No.

Agency/Source

FY 2019-20

MYT Order dt. 01.03.2019 APDCL Petition Approved after True-up

Quantum (MU)

Total Cost (Rs Cr)

Rs/kWh Quantum

(MU) Total Cost

(Rs Cr) Rs/kWh

Quantum (MU)

Total Cost (Rs Cr)

Rs/kWh

1 APGCL 2,337.57 706.70 3.02 1,497.90 498.21 3.33 1,505.58 501.67 3.33 2 NEEPCO (HYDRO)

KOPILI I 422.79 44.78 1.06 380.80 42.35 1.11 380.80 42.35 1.11

KOPILI II 51.76 6.43 1.24 53.32 3.17 0.59 53.32 3.17 0.59

KHANDONG 111.29 17.59 1.58 102.89 8.70 0.85 102.89 8.70 0.85

RHEP 548.20 88.73 1.62 550.91 123.76 2.25 550.91 123.76 2.25

DHEP 97.97 45.53 4.65 74.98 42.91 5.72 74.98 42.91 5.72

KAMENG 225.41 99.61 4.42 _ _ _ _ _ _ 3 NEEPCO (TH)

AGBPP 788.12 292.07 3.71 938.43 379.56 4.04 938.43 379.56 4.04

AGTPP 176.61 79.81 4.52 336.91 142.85 4.24 336.91 142.85 4.24

AGTPP-2 84.05 13.46 1.60 4 NHPC Existing Lg HEP 216.58 57.73 2.67 102.35 45.21 4.42 102.35 45.21 4.42 5 NTPC (Existing)

FARAKKA 229.30 80.38 3.51 227.30 92.06 4.05 227.30 92.06 4.05

KAHELGAON - I 111.51 57.52 5.16 114.60 40.75 3.56 114.60 40.75 3.56

KAHELGAON -II 469.42 146.06 3.11 492.27 164.19 3.34 492.27 164.19 3.34

TALCHER 151.07 34.65 2.29 184.68 41.52 2.25 184.68 41.52 2.25 6 NTPC (New) BTPS 1,530.58 959.03 6.27 2,691.97 1,594.38 5.92 2,691.97 1,594.38 5.92

NTPC BTPS III 565.87 354.57 6.27 7 MeECL 2.17 1.55 7.14 0.04 0.01 2.50 0.04 0.01 2.50 8 Pare HEP 128.35 54.35 4.23 187.83 94.56 5.03 187.83 94.56 5.03 9 Suryatap Solar 4.19 3.68 8.78 6.06 5.32 8.78 6.06 5.32 8.78


Sl. No.

Agency/Source

FY 2019-20


Quantum (MU)

Total Cost (Rs Cr)

Rs/kWh Quantum

(MU) Total Cost

(Rs Cr) Rs/kWh

Quantum (MU)

Total Cost (Rs Cr)

Rs/kWh

11 JNNSM Bundled Solar power 8.74 10.38 11.88 7.74 9.61 12.42 7.74 9.61 12.42 12 SECI Solar 34.95 22.63 6.47 38.39 23.77 6.19 38.39 23.77 6.19 13 JNNSM Bundled Coal power 35.09 9.80 2.79 51.68 19.77 3.83 51.68 19.77 3.83 14 Bilateral Sources/Traders 627.20 269.67 4.30 627.20 269.67 4.30 15 Power Exchanges 504.82 206.78 4.10 504.82 206.78 4.10 16 OTPC 1,388.14 469.41 3.38 1,252.27 392.39 3.13 1,252.27 392.39 3.13 17 HHPCPL (Champawati) 14.66 6.33 4.32 5.35 2.20 4.11 5.35 2.20 4.11 18 Wind Power PTC 87.16 30.77 3.53 86.85 30.66 3.53 86.85 30.66 3.53 19 SECI Wind 87.16 23.71 2.72 75.98 20.67 2.72 75.98 20.67 2.72 20 Mangdechhu 207.13 96.64 4.67 207.13 96.64 4.67 21 PTC Nikachu 139.81 58.05 4.15 22 SPV Assam 43.69 14.53 3.33 23 Power Swapping

Arrangement 7.19 0.19 0.26 7.19 0.19 0.26

Sub-total: 10,092.21 3,789.84 3.76 10,807.84 4,391.86 4.06 10,815.52 4,395.34 4.06

24 REC (Solar) 24.75 40.70 40.70

25 REC (Non-Solar) 5.96 -

26 Deviation Settlement Mechanism

132.98 73.91 5.56 132.98 73.91 5.56

Sub-total: 10,092.21 3,820.55 3.79 10,940.82 4,506.47 4.12 10,948.50 4,509.95 4.12

27 AEGCL Cost 360.84 251.00

251.81

28 SLDC Charges 3.85 3.85

29 PGCIL Transmission Charges 537.18 772.71

772.71

TOTAL 10,092.21 4,722.42 4.68 10,940.82 5,530.18 5.05 10,948.50 5,538.32 5.06


Sl. No.

Agency/Source

FY 2019-20


Quantum (MU)

Total Cost (Rs Cr)

Rs/kWh Quantum

(MU) Total Cost

(Rs Cr) Rs/kWh

Quantum (MU)

Total Cost (Rs Cr)

Rs/kWh

30 Less: Delayed Payment Charge

4.83 4.83

Net Power Purchase 10,092.21 4,722.42 4.68 10,940.82 5,525.35 5.05 10,948.50 5,533.49 5.05

Therefore, the Commission approves Power Purchase Expenses of Rs. 5533.49 Crore in the truing up for FY 2019-20.


4.6 Sharing of Gains/(Losses) on account of excess Power Purchase cost

due to higher than approved Distribution Losses

4.6.1 As the actual Distribution Losses are higher than the approved Distribution Losses for

FY 2019-20, 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 13: Sharing of Efficiency Gain/(Loss) on account of Distribution Losses

approved by the Commission (Rs. Crore)

Particulars Unit APDCL Approved after

True-up

Total Power Purchase MU 10,941 10,949

Trading Sale MU 1,520 1,520

Energy Purchased for sale within

State MU 9,421 9,429

Allowable Energy Purchase for sale

within State MU 9,078 9,078

Excess Energy Purchase MU 344 351

Average power purchase rate Rs/kWh 4.08 4.12

Excess Power Purchase Cost Rs. Crore (140.24) (144.74)

Share of gain/(loss) to be borne by

APDCL Rs. Crore

(93.41)

(96.49)

Share of gain/(loss) to be borne by

consumers Rs. Crore (46.70) (48.25)

Therefore, the Commission disallows two third of the excess power purchase

cost, i.e., Rs. 96.49 crore in the truing up for FY 2019-20, which will be borne by

APDCL, and one third of the excess power purchase cost, i.e., Rs. 48.25 Crore is

passed on to the consumers as per the MYT Regulations, 2018.

4.7 O&M Expenses

4.7.1 APDCL has claimed O&M expenses of Rs. 921.70 Crore against the approved O&M

expenses of Rs. 1049.79 Crore for FY 2019-20, as shown in the following Table:


Table 14: O&M Expenses for FY 2019-20 as submitted by APDCL (Rs. Crore)

Sl. No.

Particulars MYT Order dt.

01.03.2019 APDCL

1 Employee Expenses 850.68 733.00

2 R&M Expenses 149.97 148.84

3 Administrative & General (A&G) Expenses 49.14 39.86

4 Total O&M expenses 1,049.79 921.70

Employee Expenses

4.7.2 APDCL submitted that against the normative Employee expenses of Rs.850.68 Crore

approved in the Tariff Order dated March 01,2019, the actual Employee expenses

incurred is Rs. 682.36 Crore as per Audited Accounts.

4.7.3 APDCL submitted that Employee Expenses comprise salaries, dearness allowance,

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

leave encashment, and staff welfare expenses.

4.7.4 Considering the stalemate of recruitment process due to legal complications, no

growth is considered and growth factor is taken as 0% against the approved growth

factor of 1%.

4.7.5 APDCL submitted the computation of normative employee expenses for FY 2019-20

as shown in the Table below:

Table 15: Normative Employee Expenses for FY 2019-20 as submitted by APDCL (Rs.

Crore)

Particulars MYT Order

dt. 01.03.2019 APDCL

Employee Expenses for previous year 811.62 703.34

Growth Factor 1% 0%

Consumer Price Index (CPI) Inflation 3.77% 4.22%

Employee Expenses 850.68 733.00

Repair & Maintenance (R&M) Expenses

4.7.6 APDCL submitted that as against the normative R&M expenses of Rs.149.97 Crore

approved in the Tariff Order dated March 01, 2019, the actual R&M expenses incurred

is Rs. 146.07 Crore.


4.7.7 APDCL submitted that R&M expenses are directly related to volume of operations

carried out. Manifold expansion of network with implementation of various

electrification programmes, viz., RGGVY/DDUGJY, SAUBHAGYA, IPDS, TDF and

EAP, necessitate extensive coverage for such works. However, adequate

maintenance of assets could not be carried out in time due to restricted allowance in

tariff for many previous years.

4.7.8 APDCL has computed the normative R&M expenses of Rs. 148.84 Crore on the basis

of “K” factor and Wholesale Price Index (WPI) index, as shown in the following Table:

Table 16: Normative R&M Expenses for FY 2019-20 as submitted by APDCL (Rs. Crore)


dt. 01.03.2019 APDCL

Average GFA for previous year 4,159.82 4,129.59

K Factor 3.50% 3.50%

WPI Inflation 3.00% 2.98%

R&M Expenses 149.97 148.84

Administrative and General (A&G) Expenses

4.7.9 APDCL submitted that A&G Expenses comprise rents, taxes, various statutory

charges, telephone and other communication expenses, professional charges, legal

charges, conveyance and travelling allowance, etc. Payment of fees to the

Commission amounting to Rs. 3.74 Crore is considered separately, in line with the

Commission’s approval in the APR of FY 2019-20.

4.7.10 APDCL submitted that the actual A&G Expenses are Rs.82.25 Crore, as per Audited

Accounts, as against approved normative A&G expenses of Rs. 49.14 Crore approved

in the MYT Order.

4.7.11 APDCL computed the normative A&G expenses of Rs. 39.86 Crore based on WPI and

provision, as shown in the following Table:


Table 17: Normative A&G Expenses for FY 2019-20 as submitted by APDCL (Rs. Crore)


dt. 01.03.2019 APDCL

A&G Expenses for Previous Year 45.76 33.13

WPI Inflation 3% 2.98%

Provision 2.00 2.00

Statutory Fees - 3.74

A&G Expenses 49.14 39.86


4.7.12 The Commission in the MYT Order dated March 1, 2019 has allowed O&M Expenses

on normative basis. For the purpose of truing up for FY 2019-20, the Commission has

computed the normative O&M Expenses as per Regulation 37 of the MYT Regulations,

2018. Any variation between normative O&M expenses and actual O&M Expenses

has been considered under sharing of gains/losses on account of controllable items

as per Regulation 12 of the MYT Regulations, 2018.

4.7.13 For computation of normative employee expenses for FY 2019-20, the Commission

has adopted the following approach:

a) The employee expenses approved after True-up for FY 2018-19 have been

considered as base expenses;

b) CPI inflation has been computed as average increase of CPI index for the period

from FY 2016-17 to FY 2018-19, which works out to 4.22%;

c) The growth factor has been considered as 0% against approved growth factor of

1%, as there has been a decline rather than growth in the number of employees.

4.7.14 The normative employee expenses approved in the true-up for FY 2019-20 are shown

in the following Table:

Table 18: Approved Employee Expenses for FY 2019-20 (Rs. Crore)


01.03.2019

APDCL Approved

after true-up

Employee Expenses for

Previous Year

811.62 703.34 703.34

Growth Factor 1% 0% 0%

CPI Inflation 3.77% 4.22% 4.22%



01.03.2019

APDCL Approved

after true-up

Employee Expenses 850.68 733.00 733.00

Therefore, the Commission approves Normative Employee Expenses of Rs. 733

Crore in the true-up for FY 2019-20.

4.7.15 For computation of normative R&M Expenses for FY 2019-20, the Commission has

considered the following approach:

a) The Commission has considered the average increase of WPI of FY 2016-17 to

FY 2018-19, i.e., 2.97 % for computation of R&M expenses;

b) The Commission has adopted the K-factor approved for the Control Period, i.e.,

3.50%;

c) Since, K-factor has been considered on the basis of average Gross Fixed Assets

(GFA), for computation of R&M expenses for FY 2019-20, average GFA for

previous years has been considered.

4.7.16 The normative R&M expenses approved in the true-up for FY 2019-20 are shown in

the following Table:

Table 19: Approved R&M Expenses for FY 2019-20 (Rs. Crore)


01.03.2019 APDCL

Approved

after True-up

Average GFA for previous year 4159.82 4,129.59 4,129.59

K Factor 3.50% 3.50% 3.50%

WPI Inflation 3% 2.98% 2.97%

R&M Expenses 149.97 148.84 148.83

Accordingly, the Commission approves R&M Expenses of Rs. 148.83 Crore in

the true-up for FY 2019-20.

4.7.17 For computation of normative A&G expenses for FY 2019-20, the Commission has

adopted the following approach:

a) The A&G expenses approved after True-up for FY 2018-19 have been considered

as base expenses;


b) As stated earlier, the WPI inflation has been considered as 2.97 %, for computation

of A&G expenses;

c) The provision of Rs. 2 crore allowed additionally against special initiatives has been

allowed, as APDCL has submitted details of actual expenditure of Rs. 3.28 crore

under this head;

d) The statutory fees of Rs. 3.74 crore have been allowed at actuals, in line with the

approach adopted in the APR for FY 2019-20.

4.7.18 The A&G expenses approved in the true-up for FY 2019-20 are shown in the following

Table:

Table 20: Approved A&G Expenses for FY 2019-20 (Rs. Crore)


01.03.2019 APDCL

Approved after

True-up

A&G Expenses for Previous

Year

45.76 33.13 34.60

WPI Inflation 3.00% 2.98% 2.97%

Provision 2.00 2.00 2.00

Statutory Fee - 3.74 3.74

A&G Expenses 49.14 39.86 41.37

Therefore, the Commission approves A&G Expenses of Rs. 41.37 crore in the

true-up for FY 2019-20.

4.7.19 The normative O&M expenses approved by the Commission in the true-up for FY


Table 21: Normative O&M Expenses approved by Commission for FY 2019-20 (Rs. Crore)

Sl.

No. Particulars

MYT Order dt.

01.03.2019

APDCL

submission

Approved after

True-up

1 Employee Expenses 850.68 733.00 733.00

2 R&M Expenses 149.97 148.84 148.83

3 A&G Expenses 49.14 39.86 41.37

Total 1,049.79 921.70 923.21

4.8 Sharing of Efficiency Gains/(Losses) on account of O&M Expenses

4.8.1 Regulation 10.2 of MYT Regulations, 2018 specifies O&M Expenses (excluding


terminal liabilities with regard to employees on account of changes in pay scales or

dearness allowance due to inflation) as a controllable factor. APDCL has submitted

the sharing of gains/(losses) on account of O&M Expenses for FY 2019-20, as shown

in the Table below. No sharing of gains and losses has been considered for terminal

benefits.

Table 22: Sharing of gains or losses for O&M Expenses for FY 2019-20 as submitted by

APDCL (Rs. Crore)

Sl. No.

Particulars Actual Normative

Gains/ (Losses)

1/3 of Gains/

(Losses)

A B C = (B-A) D = C x 1/3

1 Employee Cost 682.36 733.0 50.64 16.88

Less: Terminal Benefits

104.38 104.38

Employee Cost excl. Terminal Benefits

577.98 628.62 50.64 16.88

2 R&M Expenses 146.07 148.84 2.77 0.92

3 A&G Expenses 82.25 39.86 (42.40) (14.13)

4 TOTAL 910.68 921.69 11.02 3.67


4.8.2 The Commission has considered sharing of gains or losses after excluding terminal

liabilities from normative as well as actual employee expenses. Accordingly, terminal

liabilities are allowed on actual basis.

4.8.3 The sharing of gains/(losses) on account of O&M Expenses approved by the

Commission in the true-up for FY 2019-20, is shown in the following Table:

Table 23: Sharing of gains/(losses) for O&M Expenses approved by the Commission

for FY 2019-20 (Rs. Crore)

Sl. No.


Gains/ (Losses)

1/3 of Gains/ (Losses)

A B C = (B-A) D = C x 1/3

1 Employee Cost 682.36 733.00 50.64 16.88

Less: Terminal Benefits 104.38 104.38 0 0

Employee Cost excl. Terminal Benefits

577.98 628.62 50.64 16.88

2 R&M Expenses 146.07 148.84 2.77 0.92

3 A&G Expenses 82.25 41.37 (40.88) (13.63)


Sl. No.


Gains/ (Losses)

1/3 of Gains/ (Losses)

A B C = (B-A) D = C x 1/3

4 TOTAL 806.30 818.84 12.54 4.18

4.8.4 Since, actual O&M expenses are lower than the normative O&M expenses, 1/3rd of the

net gain, i.e., Rs 4.18 Crore, has been reduced from the ARR, after considering O&M

expenses on normative basis.

4.9 Capital Investment & Capitalisation

4.9.1 APDCL submitted that it has achieved actual Capital Expenditure of Rs. 1687.34 Crore

and Capitalization of Rs. 1343.10 Crore [including Rs. 1295.54 Crore through

capitalisation of Capital Work in Progress (CWIP) Schemes] during FY 2019-20, as

against the capitalisation of Rs. 650 crore approved by the Commission in the MYT

Order.

4.9.2 APDCL submitted that increase in Capital Expenditure is primarily due to

materialization of funding against projects executed under RGGVY XIIth Plan,

DDUGJY, SAUBHAGYA, IPDS, and EAP.

4.9.3 The following Table shows the Capital Expenditure and Capitalization achieved by

APDCL in FY 2019-20:

Table 24: Capital Expenditure and Capitalization submitted by APDCL (Rs. Crore)


01.03.2019 APDCL submission

Capital Expenditure 1000.00 1687.34

Capitalisation 650.00 1343.10

Note: Capitalisation considered based on clarification submitted by APDCL vide its replies dated 25 January, 2021


4.9.4 APDCL was asked to submit the actual scheme-wise capital expenditure and

capitalisation achieved in FY 2019-20, which was submitted by APDCL. APDCL further

submitted that the net addition to Gross Fixed Assets (GFA) for the purpose of

computing depreciation was Rs. 59.09 Crore, while capitalisation of Rs. 1283.88 Crore


is towards assets not belonging to APDCL, and Rs. 0.13 Crore is funded by Consumer

Contribution.

4.9.5 The Commission has verified the Capitalisation amounts from the Audited Accounts of

APDCL for FY 2019-20. The Commission has considered the actual capitalisation

based on the Audited Accounts in the true-up for FY 2019-20. Accordingly, the Capital

Expenditure and Capitalisation approved by the Commission in the true-up for FY


Table 25: Capital Expenditure and capitalisation approved by the Commission (Rs.

Crore)

Particulars Tariff Order dt.

01.03.2019

APDCL Approved

after True-up

Capital Expenditure 1000.00 1687.34 1687.34

Capitalisation 650.00 1343.10 1343.09

4.9.6 As regards the funding of capitalisation, the Commission has not considered any equity

funding. The grant funding has been considered as per the Audited Accounts, equal

to the assets capitalised but not belonging to APDCL, and the balance has been

considered as funded through debt. The funding of capitalized works, as approved by

the Commission in the true-up for FY 2019-20, is shown in the following Table:

Table 26: Funding of Capitalised Works approved by the Commission (Rs. Crore)

Particulars Approved

after True-up

Grant 1284.01

Equity -

Debt 59.08

Total Capitalisation 1343.09

Therefore, the Commission approves total Capitalisation of Rs. 1343.09 crore in

the true-up for FY 2019-20.


4.10 Depreciation

4.10.1 APDCL submitted that Opening Gross Fixed Assets (GFA) for FY 2019-20 as per the

statement of accounts is Rs. 4435.55 Crore and depreciable assets are Rs. 2414.79

Crore.

4.10.2 APDCL submitted that Depreciation has been calculated taking into consideration the

opening GFA as well as addition of assets during FY 2019-20 as per Audited Accounts.

APDCL submitted that the truing up claim of depreciation is based on the depreciation

rates specified in the MYT Regulations, 2018, as shown in the Table below:


Table 27: Depreciation Calculation for FY 2019-20 as submitted by APDCL (Rs. Crore)

(Gross Fixed Assets) Depreciation

Particulars As on

01.04.19 Net addition

during the year Rate of

Dep Accumulated as on 01.04.19

Assets fully depreciated

On Opening Balance

On Addition

Total

Land & Rights

i) Land owned under full title 18.59 0.15 - - - -

ii) Leasehold land 2.84 - 3.34% 0.14 0.09 - 0.09

Sub-total: 21.43 0.15 0.14 - 0.09 - 0.09

Building 55.91 1.06 3.34% 24.10 17.38 1.16 0.02 1.17

Other Civil Works 56.77 1.85 3.34% 26.72 20.20 1.10 0.03 1.13

Plant & Machinery 718.13 5.49 5.28% 372.61 211.76 24.06 0.13 24.19

Lines & Cable Network 1271.89 45.02 5.28% 653.16 382.23 42.28 1.07 43.35

Vehicles 27.24 0.00 5.28% 10.59 11.42 0.75 0.00 0.75

Furniture & Fixtures 17.59 0.64 6.33% 10.97 9.15 0.48 0.02 0.50

Office Equipment 30.73 4.88 6.33% 20.06 19.25 0.65 0.14 0.79

SUB TOTAL 2,199.70 59.09 3.30% 1,118.36 671.38 70.57 1.40 71.97

Add: Consumer contribution deducted from service connection under O.H. lines& cable network

233.68 0.13 5.28% 103.61 11.10 0.00 11.11

Add: Assets not belonging to the entity

2,002.18 1,283.88 -

- -

4435.55 1,343.10 1,221.97 671.38 81.67 1.40 83.08


Table 28: Depreciation Claimed by APDCL (Rs. Crore)

Particulars

State Govt. Grant

Grant for assets not belonging to entity (RGGVY,

MNRE etc.)

Co

nsu

mer

Co

ntr

ibu

tio

n

Total

As on 01.04.05

As on 01.04.19 Sub total As on 01.04.2019

Grants Available - 2,896.25 2,896.25 5,168.24 233.68 8,298.17

GFA (excluding Consumer Contribution and assets not belonging to company)

765.43 1,434.27 2,199.70 2,002.18 233.68 4,435.55

CWIP 330.20 2,599.78 2,929.99 2,472.20 5,402.18

Total 1,095.63 4,034.05 5,129.68 4,474.37 233.68 9,837.73

Cumulative grants apportioned in the ratio of GFA and CWIP

GFA - 1,029.73 1,029.73 2,312.67 233.68 3,576.08

CWIP - 1,866.51 1,866.51 2,855.57 4,722.09

Total - 2,896.25 2,896.25 5,168.24 233.68 8,298.17

Depreciation calculated as per the Regulation on the GFA

25.04 46.93 71.97 - 11.11 83.08

Weighted Average Rate of Depreciation (%) 3.27% 3.27% 3.27% - 4.75% 1.87%

Depreciation to be deducted on the assets built on the grants component on 90% asset

- 33.69 33.69 - 33.69

Depreciation claimed 25.04 13.24 38.28 - 11.11 49.39


4.10.3 APDCL has claimed depreciation of Rs. 49.39 Crore as shown in the Tables above.

4.10.4 APDCL has claimed the depreciation amount based on the following parameters:

a) Rates of depreciation notified in addendum to MYT Regulations 2018;

b) 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 total

depreciation on the opening balance of GFA as on Transfer Scheme dated 1st

April, 2005 amounting to Rs. 25.04 Crore calculated at the weighted average

rate of 3.27% is claimed in totality;

c) Depreciation on subsequent assets is claimed after apportionment of available

grant; Total amount of depreciation claimed on this account is Rs. 13.24 Crore

after adjustment of funding from grant.

d) As no depreciation has been claimed on assets created out of RGGVY, MNRE

grant received against such schemes are shown separately with no claim of

depreciation.


4.10.5 The Commission has considered the opening GFA for FY 2019-20 as per the closing

GFA value approved in True up of FY 2018-19 vide Tariff Order dated March 07, 2020.

The Commission has computed depreciation as per scheduled rates specified in the

MYT Regulations, 2018.

4.10.6 As per Regulation 32.2 of the MYT Regulations, 2018, the total depreciation during the

life of the asset shall not exceed 90% of the original cost of GFA. The Commission has

computed the depreciation separately for assets added under each asset head in each

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 has not considered depreciation on assets funded through grants and

consumer contribution in accordance with Regulations 30 and 32 of MYT Regulations,

2018, and in accordance with the Commission’s own Orders and the Hon’ble APTEL

Judgment in this regard.

4.10.7 Accordingly, the Commission has approved depreciation for FY 2019-20 as per the


MYT Regulations, 2018, as given in the Table below:

Table 29: Depreciation approved for FY 2019-20 (Rs. Crore)

Sl.

No. Particulars

FY 2019-20

Opening

GFA

Addition

during the

year

Rate of

depreciation

Approved

after true-up

1 Land & Rights 18.60 0.15 - -

2 Lease hold Land 2.84 - 0.09

3 Building 55.90 1.06 3.34% 1.89

4 Plant & Machinery 718.13 5.49 5.28% 26.74

5 Vehicle 27.24 - 9.50% 1.48

6 Furniture & Fixtures 17.59 0.64 6.33% 0.55

7 Office Equipment 30.73 4.88 6.33% 1.90

8 Other Civil Work 56.77 1.85 3.34% 1.93

9 Lines & Cable Network 1,271.89 45.02 5.28% 46.94

10 Total 2,199.69 59.09 81.53

11 Opening GFA excluding land 4,425.93

12 Closing GFA excluding land 5,757.06

13 Average Grant towards GFA 4,756.00

14 Less: Depreciation for

Grants/Consumer Contribution

76.15

13 Net Depreciation Allowed 5.37

Therefore, the Commission approves Depreciation of Rs. 5.37 crore in the truing

up for FY 2019-20.

4.11 Interest and Finance Charges

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

in its Orders. APDCL has considered the normative closing loan of Rs. 639.15 Crore

for FY 2018-19 as approved in the true-up of FY 2018-19, as the normative loan

outstanding as on April 1, 2019. The actual Interest rate has been considered to

compute the interest on the normative loan balance.

4.11.2 The net interest expenses claimed by APDCL are shown in the Table below:


Table 30: Normative Interest as submitted by APDCL for FY 2019-20 (Rs. Crore)

Particulars Tariff Order

dt. 01.03.2019 APDCL

Normative Opening Loan 50.76 639.15

Addition of Normative loan during the year 65.00 3.94

Normative repayment during the year 17.77 49.39

Net Normative closing Loan 97.99 593.71

Rate of Interest 9.40% 10.74%

Interest on Loan 6.99 63.76

Bank Charges - 2.68

Bill Desk Charges for Collecting Revenue - 2.52

Net Interest & Finance Charges 6.99 68.96

4.11.3 APDCL submitted that considering the Commission’s observations in its previous Tariff

Orders, APDCL has excluded the interest liabilities on GPF as well as NPS to provide

tariff relief to that extent. APDCL stated that it reserved its right to claim the amounts

in future.


4.11.4 The Commission has approved Interest on loan capital for FY 2019-20 on normative

basis as per Regulation 34 of the MYT Regulations, 2018.

4.11.5 The Normative closing loan of FY 2018-19, as approved in the true-up for FY 2018-

29, has been considered as the loan outstanding as on April 1, 2019. The Commission

has considered the net addition of loan during FY 2019-20 as Rs. 59.08 crore, in

accordance with the funding of capitalisation approved earlier in this Order. The loan

repayment has been considered equivalent to depreciation approved for FY 2019-20

in this Order. The Commission has considered the weighted average Interest rate of

10.74% of actual loan portfolio, as submitted by APDCL, in accordance with the MYT

Regulations, 2018. The actual Other Financing Charges and Bill Desk Charges have

been allowed as per Audited Accounts of APDCL.

The Interest and Financing Charges approved by the Commission after true-up for FY



Table 31: Approved Interest & Financing Charges for FY 2019-20 (Rs. Crore)


dt. 01.03.2019 APDCL

Approved

after True-up

Net Normative Opening Loan 50.76 639.15 639.15

Addition of normative loan during the year 65.00 3.94 59.08

Normative Repayment during the year 17.77 49.39 5.37

Net Normative Closing Loan 97.99 593.70 692.86

Interest Rate 9.40% 10.74% 10.74%

Interest Expenses 6.99 63.76 71.53

Interest & Financing Charges 2.68 2.68

Bill Desk Charges for collecting Revenue 2.52 2.52

Total Interest & Financing Charges 68.96 76.73

4.11.6 The Commission has continued with its approach on disallowing Interest on GPF and

NPS, as adopted in previous Tariff Orders.

4.11.7 Therefore, the Commission approves Interest on Loans of Rs. 76.73 Crore in the

truing up for FY 2019-20.

4.12 Interest on Working Capital

4.12.1 APDCL submitted that Interest on Working Capital (IoWC) has been calculated on

normative basis in accordance with the MYT Regulations, 2018, as shown in the Table

below:

Table 32: IoWC as submitted by APDCL for FY 2019-20 (Rs. Crore)


01.03.2019 APDCL

O&M Expenses-One month 87.48 76.81

2-month Receivables 890.12 930.63

Maintenance spares @ 15% of O&M Expenses 157.47 138.25

Less: One-month Power Purchase Cost 393.53 443.22

Less: Consumer Security Deposit 753.70 685.98

Total Working Capital (12.17) 16.49

Rate of Interest on WC 11.50% 11.54%

Interest on Working Capital - 1.90


4.12.2 APDCL has considered rate of interest equal to the State Bank of India (SBI) MCLR

(1-year tenor) as on 1st April 2019 plus 300 basis points, i.e., 11.54%.

4.12.3 APDCL submitted that the Consumer Security Deposit (CSD) of Rs. 35.73 Crore of

the permanently disconnected consumers has not been considered for calculation of

normative IoWC.

4.12.4 APDCL also submitted that as payment to IEX is pre-paid in nature, the same has

been deducted to derive one month’s power purchase cost, while computing the

normative working capital requirement.


4.12.5 The Commission has computed IoWC in accordance with Regulations 36.3 and 36.4

of the MYT Regulations, 2018. The normative O&M expenses approved after true-up

for FY 2019-20 in this Order has been considered. The working capital requirement

towards two months of receivables has been considered based on the actual revenue

earned by APDCL in FY 2019-20. The average amount of CSD for FY 2019-20 has

been taken from the Audited Accounts, after deducting the CSD of the permanently

disconnected consumers, in accordance with the approach adopted in previous years.

4.12.6 The amount towards one-month of power purchase cost has been reduced from the

normative working capital requirement. APDCL has submitted that as payment to

Power Exchange is pre-paid nature, the same should be deducted to derive one

month’s power purchase cost. The Commission funds merit in this submission of

APDCL, as one-month of power purchase cost is reduced while computing the working

capital requirement, because APDCL gets average credit period of one-month for

payment of power purchase bills. Hence, the Commission has reduced the cost of

power purchase from Power Exchange, as approved after true-up, while computing

the working capital requirement. The rate of Interest has been considered equal to SBI

MCLR Rate as on April 1, 2019 plus 300 basis points, i.e., 11.14%.

4.12.7 The IoWC approved by the Commission in the truing up for FY 2019-20 is shown in



Table 33: IoWC approved by the Commission for FY 2019-20 (Rs. Crore)

Particulars

Tariff

Order dt.

01.03.2019

True-up

Claimed

Approved

after True-

up

O&M Expenses for one month 87.48 76.81 76.93

2-month Receivables 890.12 930.63 898.59

Maintenance spares @ 15% of O&M

Expenses

157.47 138.25 138.48

Less: One-month Power Purchase Cost 393.53 443.22 443.89

Less: Consumer Security Deposit 753.70 685.98 724.75

Total Working Capital (12.17) 16.49 (54.64)

Rate of Interest on WC 11.50% 11.54% 11.14%

Interest on Working Capital - 1.90 -

Therefore, the Commission approves NIL Interest on Working Capital in the

truing up for FY 2019-20, as the net working capital requirement is negative.

4.13 Interest on Consumer Security Deposit

4.13.1 APDCL submitted that the actual liability of Interest on CSD as per Audited Accounts

is Rs. 65.32 Crore, out of which, Rs. 38.06 Crore is actually paid during FY 2019-20.

APDCL has claimed the amount of Rs. 38.06 Crore actually liquidated against interest

on CSD during FY 2019-20 and requested the Commission to allow pass through of

the remaining amount as and when payment is made.


4.13.2 The Commission has approved the actual interest paid by APDCL on CSD in the true-

up for FY 2019-20, as shown in the Table below:

Table 34: Interest on CSD approved for FY 2019-20 (Rs. Crore)


dt. 01.03.2019 APDCL

Approved

after True-up

Interest payable 65.32 65.32

Interest Actually Paid 16.15 38.06 38.06


The Commission approves the actual interest on CSD of Rs. 38.06 Crore paid by APDCL

to the consumers, in the truing up for FY 2019-20.

4.14 Provision for Bad & Doubtful Debts

4.14.1 APDCL submitted that the Commission has approved an amount of Rs. 12.35 Crore

as provision for bad & doubtful debts in the MYT Order dated March 01, 2019. APDCL

has claimed the Provision for Bad & Doubtful Debts of Rs. 22.10 Crore equivalent to

1% of amount receivable as on 31 March, 2020, as shown in the Table below:

Table 35: Provision for Bad & Doubtful Debts as submitted by APDCL (Rs. Crore)


01.03.2019 APDCL

Provision for Bad & Doubtful Debts 12.35 22.10


4.14.2 The Commission has allowed the provisioning for bad and doubtful debts at 1% of

receivables in the truing-up for FY 2019-20, as per the MYT Regulations, 2018, as

shown in the Table below:

Table 36: Provision for Bad & Doubtful Debts approved by the Commission (Rs. Crore)


dt. 01.03.2019

APDCL Approved after True-

up

Provision for Bad and Doubtful Debts 12.35 22.10 22.10

Therefore, the Commission approves Provision for Bad & Doubtful Debts of Rs.

22.10 crore in the truing up for FY 2019-20.

4.15 Net Prior Period Income/(Expenses)

4.15.1 APDCL submitted that Commission has not allowed any amount under this head in

the MYT Order. However, the actual component-wise breakup is detailed in the Table

below:


Table 37: Net Prior Period Income/(Expenses) claimed by APDCL for FY 2019-20 (Rs.

Crore)

Particulars Actual APDCL Claim

Prior Period Income

Interest income for prior period (35.31) (35.31)

Excess Provision for depreciation in prior periods 0.35

Excess provision for interest and finance charges in prior period

563.25

Excess provision in prior period (7.30) (7.30)

Other income relating to prior period (0.68) (0.68)

Total Prior Period Income 520.31 (43.29)

Prior Period Expenses

Operating losses for Prior Period 16.82 16.82

Employee cost relating to Prior Period 0.78

Interest and other finance charges relating to prior periods

(41.36) (41.36)

Administration expenses relating to prior periods 3.76 3.76

Total Prior Period Expenses (20.00) (20.78)

Net Prior Period Income/(Expenses) 540.31 (22.51)

4.15.2 APDCL submitted that an amount of Rs. 554.00 Crore has been waived off on account

of interest accrued on GoA loan as on 30.09.2015 as per GoA notification No.

PEL.137/2018/59 dt. 11.11.2019, in accordance with the UDAY MoU. As the interest

has been calculated on normative basis taking into consideration UDAY conversion,

the same has not been considered. Similarly, impact of Rs. 9.25 Crore, which is a book

adjustment due to pendency in notification of UDAY, has also not been considered.

4.15.3 APDCL has claimed Net Prior Period Expense of Rs. 22.51 Crore in the true-up for FY

2019-20 and submitted the details of each head of prior period expenses and prior

period income considered in the Audited Accounts of APDCL.


4.15.4 The Commission sought further clarification from APDCL regarding the heads of Prior

Period Income/(Expenses), as considered in the Audited Accounts and as claimed by

APDCL in the true-up for FY 2019-20, which was submitted by APDCL. The


Commission has analysed the component-wise details and justification for Net Prior

Period Income/(Expenses) for FY 2019-20 as submitted by APDCL. The Commission

has considered the treatment of prior period items based on the treatment allowed to

that particular item in the true-up of the year to which the income/(expenses) pertain.

4.15.5 For prior period income/(expenses) against controllable expenses such as O&M

expenses, 2/3rdof APDCL claim has been considered as in earlier years, sharing of the

gains/losses has been allowed.

4.15.6 The interest income/(expenses) and Operating Losses of prior period have been

considered based on the detailed head-wise explanation submitted by APDCL, in

replies to data gaps. The excess provision of prior periods have not been considered

as income/(expenses), as the Commission has not allowed provisioning in the past.

4.15.7 The Net Prior Period Income/(Expenses) approved by the Commission in the true up

for FY 2019-20 is shown in the Table below:

Table 38: Prior Period Income/(Expenses) approved by the Commission for FY 2019-20

(Rs. Crore)


Approved after

True-up

Prior Period Income

Interest income for prior period (35.31) (35.31) (35.31)

Excess Provision for depreciation in prior periods

0.35

Excess provision for interest and finance charges in prior period

563.25

Excess provision in prior period (7.30) (7.30) -

Other income relating to prior period (0.68) (0.68) (0.68)

Total Prior Period Income 520.31 (43.29) (35.99)

Prior Period Expenses

Operating losses for Prior Period 16.82 16.82 16.82

Employee cost relating to Prior Period 0.78 0.52

Interest and other finance charges relating to prior periods

(41.36) (41.36) (41.36)

Administration expenses relating to prior periods

3.76 3.76 2.51



Approved after

True-up

Prior Period Income

Total Prior Period Expenses (20.00) (20.78) (21.51)

Net Prior Period Income/(Expenses) 540.31 (22.51) (14.48)

Accordingly, the Commission approves the Net Prior Period Expenses of Rs.

14.48 Crore in the truing up for FY 2019-20.

4.16 Return on Equity

4.16.1 APDCL submitted that the Commission considered equity of Rs.162.77 Crore and

allowed return @16% on the equity base. APDCL submitted that pending

notification by GoA on Share Application Money amounting to Rs. 88.04 Crore

transferred from erstwhile ASEB to APDCL and Rs.0.63 Crore transferred on

dissolution of ASEB on 31-03-2013, it was restricting its claim to the amount allowed

by the Commission in the MYT Order. Accordingly, RoE of Rs 26.04 Crore has been

claimed, as shown in the following Table:

Table 39: RoE as submitted by APDCL (Rs. Crore)

Sl. No.


dt. 01.03.2019 APDCL

A Opening Equity 162.77 162.77

1 Net Addition during the Year - -

2 Closing Equity 162.77 162.77

3 Rate of Return on Equity 16.00% 16.00%



4.16.2 As equity shares are yet to be issued against the Share Application Money Pending

Allotment, the Commission has not considered RoE on this amount, in line with the

practice followed in earlier Orders. Further, the capitalization approved in this Order

has not been funded by equity and therefore, no equity addition during the year has


been considered.

4.16.3 The RoE allowed by the Commission at 16% of the equity capital of APDCL is shown

in the following Table:

Table 40: RoE approved by the Commission for FY 2019-20 (Rs. Crore)


dt. 01.03.2019

APDCL

Petition

Approved

after true up

Opening Equity 162.77 162.77 162.77

Net Addition during the Year 0.00 0.00 0.00

Closing Equity 162.77 162.77 162.77

Rate of Return on Equity 16.00% 16.00% 16.00%

Return on Equity 26.04 26.04 26.04

Therefore, the Commission approves RoE of Rs. 26.04 crore in the truing up for

FY 2019-20.

4.17 Other Income

4.17.1 The Commission had approved the Other Income at Rs. 253.67 Crore for FY 2019-20

in the MYT Order dated March 01, 2019, whereas APDCL has submitted actual Other

Income of Rs. 586.73 Crore as per the Audited Accounts for FY 2019-20. APDCL

stated that the increase in Other Income was primarily due to income from sale of

surplus power, made possible due to export of seasonal power from allocated sources

on account of significant gap in demand during peak and off-peak hours.

4.17.2 The following Table shows the Other Income as submitted by APDCL:

Table 41: Other Income submitted by APDCL for FY 2019-20 (Rs. Crore)

Sl. No.

Particulars Tariff

Order dt. 01.03.2019

APDCL

1 Income from Investment, Fixed & Call Deposits

253.67

94.09

2 Income from Trading of Power 382.51

Income from Sale of Scrap 0.23

3 Revenue from sale of LED's, Tubelight, Fan, etc. 0.92

4 Rent from residential buildings 0.02


Sl. No.

Particulars Tariff

Order dt. 01.03.2019

APDCL

5 Receipt from Pension Trust 67.10

6 Miscellaneous receipts 42.67

7 Total 253.67 587.54


4.17.3 The Commission has considered the actual Other Income as per the Audited Accounts

in the true up for FY 2019-20, as shown in the Table below:

Table 42: Other Income approved by the Commission for FY 2019-20 (Rs. Crore)

Sl. No.


dt. 01.03.2019

APDCL Approved after true-

up

1 Income from Investment, Fixed & Call Deposits

253.67

94.09 94.09

2 Income from Trading of Power 382.51 382.51

Income from Sale of Scrap 0.23 0.23

3 Revenue from sale of LED's, Tubelight, Fan, etc.

0.92 0.11

4 Rent from residential buildings 0.02 0.02

5 Receipt from Pension Trust 67.10 67.10

6 Miscellaneous receipts 42.67 42.67

7 Total 253.67 587.54 586.73

Therefore, the Commission approves Other Income of Rs. 586.73 crore in the true

up for FY 2019-20.

4.18 Non-Tariff Income

4.18.1 APDCL submitted that it has earned Non-Tariff Income (NTI) of Rs.408.46 Crore

during FY 2019-20, as per the Audited Accounts, as against the NTI of Rs. 257.11

crore approved in the MYT Order.

4.18.2 APDCL submitted that it has earned Rs. 25.47 Crore rebate on prompt payment of

power purchase bills, which has been considered under Non-Tariff Income. The


Delayed Payment Charges (DPC) of Rs. 4.83 crore paid to various Gencos has been

deducted from the income earned from DPC levied on its consumers. The following

Table shows the Non-Tariff Income submitted by APDCL for FY 2019-20:

Table 43: Non-Tariff Income submitted by APDCL for FY 2019-20 (Rs. Crore)

Sl. Particulars Tariff

Order dtd. 01.03.2019

Actual

1 Rentals from Meters, Service Lines, Capacitors, etc.

257.11

22.07

2 Income from recoveries on account of theft of energy/ Malpractices 0.38

3 Delayed payment charges from Consumers 235.34

4 Misc. recoveries 21.44

5 Rebate on prompt payment of Power purchase bills 25.47

6 Cross Subsidy surcharge on Open Access Consumer 33.79

7 Wheeling charges collected 4.33

8 Short Term Open Access (STOA) credit 60.06

9 Income on Reactive Power 0.21

10 Income From SCED 5.36

Total 408.46


4.18.3 On scrutiny of the submission made by APDCL, it is observed that APDCL has claimed

income from DPC of Rs. 235.34 Crore by deducting the amount of Rs. 4.83 Crore paid

as DPC to various Gencos. This is an incorrect approach. The DPC paid to Gencos is

in the nature of penal charges, and cannot be allowed as an expense. Hence, the

Commission has considered Rs 240.17 Crore of DPC as per Audited Accounts.

4.18.4 In line with the approach adopted in the previous Orders, the Commission has not

considered the rebate of Rs. 25.47 Crore received on prompt payment of power

purchase bills, as NTI.

4.18.5 The amount of Non-Tariff Income approved in the true up for FY 2019-20, is shown in

the Table below:


Table 44: Non-Tariff Income approved for FY 2019-20 (Rs. Crore)

Sl. No.


dt. 01.03.2019 APDCL

Approved after true-up

1 Meter Rent 257.11

22.07 22.07

2 Compensation charges for theft of energy/malpractices

0.38 0.38

3 Cross Subsidy surcharge on Open Access Consumer

33.79 33.79

4 Wheeling Charges collected 4.33 4.33

5 Short-term Open Access Credit 60.06 60.06

6 Rebate on PP bills 25.47 -

7 Miscellaneous Recoveries 21.44 21.44

8 Other Miscellaneous Income

a) Delayed Payment Charges 235.34 240.17

b) Income on Reactive Power 0.21 0.21

c) Income from SCED 5.36 5.36

Total 257.11 408.45 387.81

Therefore, the Commission approves Non-Tariff Income of Rs. 387.81 Crore based

on the Audited Accounts, in the truing up for FY 2019-20.

4.19 Revenue from Sale of Power

4.19.1 APDCL submitted that against the approved revenue of Rs. 5592.99 Crore, the actual

revenue collected from sale of power within the State amounted of Rs.5391.51 Crore,

including targeted subsidy of Rs. 289.85 Crore received from the Government of

Assam (GoA).

4.19.2 APDCL submitted that the revenue billed is lower than approved revenue

primarily due to lesser sales than approved, however, the Average Billing Rate

(ABR) is higher than the approved ABR.


4.19.3 APDCL has claimed Revenue from sale of power as per the Audited Accounts, i.e.,

Rs. 5391.51 Crore, including targeted subsidy of Rs. 289.85 Crore received from the

GoA.

4.19.4 The Commission has verified the actual category-wise ABR vis-à-vis the ABR

approved for FY 2019-20 in the MYT Order. It is observed that in all LT categories, the

actual ABR is lower than approved ABR, with overall ABR of LT category lower by Rs.


0.48/kWh as compared to approved ABR. For all HT categories, the actual ABR is

higher than approved ABR, with overall ABR of HT category higher by Rs. 0.56/kWh

as compared to approved ABR. For overall APDCL, the actual ABR is lower than

approved ABR by Rs. 0.14/kWh. This variation is considered reasonable, as the ABR

approved in the ARR is based on estimated contribution of fixed/demand charges and

energy charges, whereas the actual ABR is based on the actual contribution of

fixed/demand charges and energy charges.

Accordingly, the Commission has considered the revenue from sale of power as

Rs. 5391.51 Crore (including targeted subsidy) in the Truing up for FY 2019-20.

4.20 Revenue Grant/Subsidy

4.20.1 APDCL submitted that the targeted subsidy allowed to various category of consumers

by GoA amounting to Rs. 289.86 Crore is considered as a part of revenue from sale

of power.

4.20.2 In addition to the above, the GoA has also provided an amount of Rs. 20.00 Crore

during FY 2019-20 as Operation Fund Requirement (OFR) (Future loss funding) as

per the UDAY MoU. The same has not been considered as revenue for the purpose

of truing up, in line with the approach adopted by the Commission in previous Orders.

4.20.3 Additionally, an amount of Rs. 238.95 Crore has also been provided by GoA as

Revenue Grant to facilitate liquidation of outstanding power purchase liabilities. The

same has been considered for passing on to the consumers in totality, in the true-up

for FY 2019-20.


4.20.4 The amount of Rs. 289.96 Crore received from GoA against targeted subsidy for FY

2019-20 has already been considered by the Commission as a part of revenue from

sale of power, as discussed in earlier Section.

4.20.5 The OFR support has not been considered as revenue for the purpose of truing up, in

line with the approach adopted by the Commission in previous Orders.

4.20.6 The additional amount of Rs. 238.95 Crore provided by GoA as Revenue Grant to

facilitate liquidation of outstanding power purchase liabilities has been considered as


Revenue, in the true-up for FY 2019-20.

The Commission accordingly considers Other Subsidy of Rs. 238.95 Crore in the Truing

Up for FY 2019-20.

4.21 ARR and Revenue Gap/(Surplus) after Truing Up of FY 2019-20

4.21.1 Considering the above heads of expense and revenue approved after truing up for FY

2019-20, the Net ARR and Revenue Gap/(Surplus) for FY 2019-20 is shown in the

following Table:

Table 45: ARR & Revenue Gap/(Surplus) approved in the Truing up for FY 2019-20 (Rs. Crore)

Sl. No.


dt. 01.03.2019


up

1 Power Purchase Expenses 4722.41 5,525.35 5,533.49

2 O&M Expenses 1,049.79 921.69 923.21

a) Employee Expenses 850.68 733.00 733.00

b) R&M Expenses 149.97 148.84 148.83

c) A&G Expenses 49.14 39.86 41.37

3 Depreciation 17.77 49.39 5.37

4 Interest and Finance Charges 6.99 68.96 76.73

5 Interest on Working Capital - 1.90 -

6 Interest on CSD 16.14 38.06 38.06

7 Return on Equity 26.04 26.04 26.04

8 Income Tax - - -

9 Prior Period Expenses 22.51 14.48

10 Provisioning for Bad & Doubtful Debts

12.35 22.10 22.10

11 Reduction in Power Purchase cost due to excess losses

(93.41) (96.49)

12 Sharing of gains/(losses) on account of O&M expenses

(3.67) (4.18)

13 Total Expenditure 5,851.49 6,578.85 6,538.81

14 Less: Non-Tariff Income 257.11 408.45 387.81

15 Less: Other Income 253.67 586.73 586.73

16 Aggregate Revenue Requirement 5,340.71 5,583.67 5,564.27

17 Revenue Gap/(Surplus) after True Up of FY 2017-18

175.19 175.19 175.19

18 Net Carrying Cost on Gap/(Surplus) of FY 2017-18

77.09 77.09 77.09


Sl. No.


dt. 01.03.2019


up

19 Net Revenue Requirement 5,592.99 5,835.95 5,816.55

20 Revenue from sale of electricity 5,592.99 5,391.51 5,391.51

21 Other Subsidy for Power Purchase 238.95 238.95

22 Total Revenue incl. subsidy 5,592.99 5,630.46 5,630.46

23 Revenue Gap/(Surplus) - 205.49 186.09

The Revenue Gap of Rs. 186.09 Crore approved in the truing up for FY 2019-20, has been

considered for adjustment during FY 2021-22, along with associated Carrying Cost, as

elaborated in Chapter 7 of this Order.


5 Annual Performance Review (APR) for FY 2020-21

5.1 Introduction

5.1.1 The Commission vide its Order dated March 07, 2020 had approved the revised ARR

for FY 2020-21. This Chapter deals with APR for FY 2020-21 in accordance with the

provisions of MYT Regulations, 2018, based on the submissions made by APDCL.

5.1.2 Regulation 9.3 of the MYT Regulations, 2018 specifies that the Commission shall

undertake the APR and True-up for the respective years of the Control Period from FY

2019-20 to FY 2021-22, as reproduced below:

“9.3 The scope of the Annual Performance 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:

…

b) Annual Performance Review: a comparison of the performance targets

estimated to be achieved for the current financial year (based on 6 months

actual data) with the approved forecast for that financial year including

adjusting trajectories of uncontrollable if needed.” (emphasis added)

5.1.3 APDCL submitted the APR Petition for FY 2020-21, supported by actual information

available till September 2020 and estimated values for the next six months of FY 2020-

21.

5.1.4 The main objective of APR is to compare the actual performance for FY 2020-21 vis-

à-vis approved forecast in the Tariff Order for FY 2020-21 dated March 07, 2020. The

Revenue Gap/(Surplus) arising out of APR for FY 2020-21 has not been passed

on to the consumers, and the same shall be considered at the time of Truing-up

only.

5.1.5 In this Chapter, the Commission has analysed the revised estimate of all the

components of ARR vis-à-vis values approved in Tariff Order for FY 2020-21. The


Commission has computed the Revenue Gap/(Surplus) as an indication of the

performance in FY 2020-21. No sharing of (gains)/ losses has been undertaken at

this stage and the same shall be considered at the time of Truing up for FY 2020-

21.

5.2 Energy Sales

5.2.1 The Commission vide MYT Order dated March 07, 2020, had approved energy sales

of 7815 MU. APDCL has estimated energy sales for FY 2020-21, based on the actual

energy sales of FY 2019-20 and actual performance during first half (H1) of FY 2020-

21 and considering practical ground realities particularly in the wake of COVID.

5.2.2 APDCL submitted that the actual energy consumption during H1 of FY 2020-21 is

almost same as that of corresponding period of previous year.

5.2.3 APDCL further submitted that there is variation of around 554 MU in revised energy

sales vis-à-vis approved energy sales entirely due to COVID. Significant impact of

COVID is very much evident from the fact that that against decline in consumption for

all consumer categories, domestic consumption has shown an increasing trend.

5.2.4 APDCL has accordingly projected energy sales for FY 2020-21 as shown in the Table

below:

Table 46: Category-wise Energy Sales Projected by APDCL for FY 2020-21 (MU)

Category

Tariff Order

dt. 07.03.2020 Estimated

JEEVAN DHARA 322 403

DOMESTIC A 0.5 kW to 5 kW 3,193 3,363

Domestic-B above 5 kW to 25 kW 403 453

Commercial Load above 0.5 to 25 kW 849 629



Agriculture up to 7.5HP 47 19


Small Industries Urban 38 25

Temporary 8 6

LT TOTAL 5,119 5,076

HT Domestic 25 kW and above 17 22

HT commercial 25 kW & above 402 279



5.2.5 For the estimation of Energy Sales for FY 2020-21, the Commission has considered

the trued-up category-wise sales in FY 2019-20 as the base figure.

5.2.6 In view of the impact of COVID on the category-wise sales of APDCL, the category-

wise energy sales estimated by APDCL for FY 2020-21 have been accepted, as

APDCL would be in the best position to judge the impact of COVID and expected

increase in sales with the gradual economic recovery.

5.2.7 The category-wise sales estimated by APDCL and approved by the Commission in the

APR for FY 2020-21 are given in the Table below:

Table 47: Energy Sales considered by the Commission for FY 2020-21 (MU)

Category Tariff Order dt.

07.03.2020

APDCL

Submission

Approved

in APR

JEEVAN DHARA 322 403 403

DOMESTIC A 0.5 kW to 5 kW 3,193 3,363 3,363

Domestic-B above 5 kW to 25 kW 403 453 453

Commercial Load above 0.5 to 25 kW 849 629 629



Agriculture up to 7.5 HP 47 19 19


Small Industries Urban 38 25 25

Public Water works 103 67

Bulk Supply Govt. Edu Inst 85 57

Bulk Supply Others 387 386

HT Small Industries up to 50 kW 21 12

HT Industries-1 50kW to 150 kW 76 52

HT Industries-II above 150 kW 1,048 703

Tea Coffee & Rubber 456 524

Oil & Coal 77 73

HT Irrigation Load above 7.5 HP 23 9

HT Temporary - 2

HT Electric Crematorium - -

HT Railway Traction - -

HT Electric Vehicle Charging Station 0.2

HT TOTAL 2,696 2,186

All Total 7,815 7,261


Category Tariff Order dt.

07.03.2020

APDCL

Submission

Approved

in APR

Temporary 8 6 6

LT TOTAL 5,119 5,076 5,076

HT Domestic 25 kW and above 17 22 22

HT commercial 25 kW & above 402 279 279




HT Small Industries up to 50 kW 21 12 12

HT Industries-1 50 kW to 150 kW 76 52 52

HT Industries-II above 150 Kw 1,048 703 703

Tea Coffee & Rubber 456 524 524

Oil & Coal 77 73 73

HT Irrigation Load above 7.5 HP 23 9 9

HT Temporary Supply - 2 2

HT Electric Crematorium - - -

HT Railway Traction - - -

HT Electric Vehicle Charging Station 0.2 0.2

HT TOTAL 2,696 2,186 2,186

All Total 7,815 7,261 7,261

Therefore, the Commission considers total sales of 7,261 MU in the APR for FY

2020-21.


5.3.1 The Commission in the Tariff Order dated March 07, 2020 had approved Distribution

Loss of 15.50% for FY 2020-21. APDCL has estimated the Distribution Loss for FY

2020-21 as 18.50%.

5.3.2 APDCL submitted that, over the years, it has been able to reduce the losses gradually

except for the years with massive rural electrification, i.e., FY 2009-10, FY 2011-12,

and FY 2018-19. Also, the outbreak of COVID has made the prevailing challenges

more difficult to counter with restriction in meter reading, billing, etc.

5.3.3 APDCL further submitted that earnest efforts have been made to ensure provisional

billing based on historical consumption with IT initiative to tackle the situation.

However, it cannot be denied that regularization will take time, with very limited


manpower engaged in various activities.

5.3.4 APDCL requested the Commission to approve the Distribution Loss of 18.50% in the

APR of FY 2020-21.


5.3.5 The Commission has already elaborated on the issue of Distribution Loss in this Order,

while Truing up for FY 2019-20. The Commission is of the view that APDCL has

reported close to approved distribution loss levels till FY 2017-18, even when there

was significant increase in the LT consumers on account of household electrification.

5.3.6 In the Tariff Order dated March 07, 2020, the Commission had approved Distribution

Loss of 15.50%. The Commission, based on the contentions of APDCL such as

inverse LT:HT ratio and massive electrification under SAUBHAGYA, had approved

such Distribution Loss levels for APDCL. Therefore, the approved Distribution Loss of

15.50% already takes into account the aspects mentioned by APDCL.

5.3.7 The Commission has therefore, considered the Distribution Loss for FY 2020-21 as

approved in the Tariff Order dated March 7,2020, as shown in the Table below:

Table 48: Distribution Losses considered by the Commission for FY 2020-21

Particulars

Tariff Order

dtd.07.03.2020

APDCL

Projection

Approved

in APR

Distribution Loss (%) 15.50% 18.50% 15.50%

5.4 Energy Balance

5.4.1 APDCL has considered the revised estimates for energy requirement for FY 2020-21

based on the revised estimates of energy sales and Distribution Losses. APDCL has

submitted that it has considered the intra-State transmission losses as 3.38%, as

intimated by AEGCL. The inter-State (PGCIL) losses have been considered as 1.42%,

based on the actual losses in FY 2019-20.

5.4.2 The estimated Energy Balance for FY 2020-21 as submitted by APDCL is shown in



Table 49: Energy Balance for FY 2020-21 as projected by APDCL (MU)

Sl. Particulars Tariff Order dt.

07.03.2020 APDCL

1 Energy Sales (MU) 7,815 7,261

2 Distribution Loss (%) 15.50% 18.50%

3 Energy Requirement (MU) 9,249 8,910

4 AEGCL Transmission Loss (%) 3.34% 3.38%

5 Energy Input to AEGCL (MU) 9,568 9,221

6 Seasonal Export (MU) - 1645

6 Pooled Loss of PGCIL (%) 1.51% 1.42%

7 Total Energy Requirement (MU) 9,715 10,999


5.4.3 The Commission has approved the Energy Balance in the APR for FY 2020-21 based

on the estimated sales, approved Distribution Loss, approved Transmission Loss

trajectory for AEGCL, and proportionate PGCIL Losses on external power purchase.

The Energy Balance approved by the Commission in the APR for FY 2020-21 is shown

in the Table below:

Table 50: Energy Balance for FY 2020-21 considered by the Commission (MU)

Sl. Particulars Tariff Order

07.03.2020 APDCL

Approved

in APR

1 Energy Sales (MU) 7,815 7,261 7,261

2 Distribution Loss (%) 15.50% 18.50% 15.50%

3 Distribution Loss (MU) 1,434 1,648 1,332

4 Energy Requirement (MU) 9,249 8,910 8,593

5 Transmission Loss (%) 3.34% 3.38% 3.34%

6 Transmission Loss (MU) 320 312 297

7 Energy input to Transmission System 9,568 9,221 8,890

8 Seasonal Export (MU) - 1,645 1,645

9 Pooled Loss of PGCIL (%) 1.51% 1.42% 1.42%


Sl. Particulars Tariff Order

07.03.2020 APDCL

Approved

in APR

10 Pooled Loss of PGCIL (MU) 147 133 128

11 Total Energy Requirement (MU) 9,715 10,999 10,662

Therefore, the Commission considers total Power Purchase Requirement of

10,662 MU after APR for FY 2020-21.

5.5 Power Purchase

5.5.1 APDCL submitted that it is largely dependent on APGCL and CGS Stations for meeting

the Base Load. However, to meet the Peak Demand of the State, APDCL has tied up

certain bilateral power and also purchases power from Power Exchanges.

5.5.2 The power purchase quantum and cost has been estimated for FY 2020-21 based on

actuals for first half of the year and estimated for second half of the year.

5.5.3 APDCL submitted that it has projected the source-wise power purchase for FY 2020-

21 based on the following assumptions:

➢ APGCL: APDCL has firm allocation of power from the State generating stations

of APGCL. Thermal plants of APGCL include NTPS, LTPS and LRPP. Hydro

plants of APGCL supplying power to APDCL are MeHEP and KLHEP. For

projecting the energy availability from these stations, APDCL has considered

gross energy availability based on allocated capacity and actual PLF, and Auxiliary

consumption for these plants in recent past with the status of operation. The tariff

for these generating stations has been considered as per the latest Tariff Order of

APGCL.

➢ Central Generating Stations (NER): The key CGS of North Eastern Region

(NER) supplying power to APDCL include plants of NEEPCO, NHPC, OTPC and

NTPC (Thermal). The share allocation of the various plants of CGS (NER) has

been considered based on the latest Regional Energy Accounts (REA), while Plant

Load Factor (PLF) is considered based on past year actuals vis-à-vis shut down

of plants. Operational norms are considered as approved by Central Electricity

Regulatory Commission (CERC) in respective Tariff Orders. The latest available


inter-State transmission loss of 1.42% is considered while intra-State transmission

loss is considered at 3.38%. The cost for the CGS has been considered as per the

latest CERC orders for the respective plants. It is to be mentioned here that Kopili-

I, Kopili II, and Khandong Stations of NEEPCO have not been considered due to

its faulty machine.

➢ Central Generating Stations (Eastern Region): The share allocation of the

various plants of CGS (ER) has been considered based on the latest REA.

Operational parameters of these plants have been considered based on the actual

generation. APDCL is allocated power from Farakka I & II, Kahalgaon I, Kahalgaon

II and Talcher of NTPC located in ER. The cost for the CGS has been considered

as per the latest CERC orders for the respective plants.

➢ Other sources: For HHPPCL, PLF and auxiliary consumption is considered as

per the Commission’s Order dated April 12, 2013. Similarly, levelized tariff is

considered as approved in this Order.

➢ Power available from NVVNL Solar Bundled (JNNSM) and NVVNL Coal Bundled

(JNNSM) has been considered based on FY 2019-20 (True up) and actuals for FY

2020-21 (H1). For Suryatap Solar, normative parameters have been considered

and rate is as per latest Tariff Order of the Commission (Rs. 8.78/kWh). Trading

purchase quantum has been considered only for the previously approved bilateral

PPA with OTPC for merchant power.

➢ Renewable sources: APDCL has projected to meet the Renewable Purchase

Obligation (RPO) by mix of purchase power from Solar power projects (25 MW x

4) and allocation from many large hydro power stations, which are in the pipeline.

The Commission has deferred the RPO compliance for FY 2019-20 till December,

2020.

➢ Inter-State and Intra-State charges: PGCIL Transmission Charges have been

projected based on actuals in H1 of FY 2020-21. The AEGCL Transmission

Charges and SLDC Charges have been considered same as approved in latest

Tariff Order of AEGCL and SLDC.


5.5.4 APDCL has estimated power purchase quantum and cost for FY 2020-21 as shown in

the Table below:

Table 51: Power Purchase for FY 2020-21 as submitted by APDCL (Rs. Crore)

Sl. No.

Agency/Source Tariff Order APDCL Submission

Total Quantum

(MU)

Total Cost (Rs

Cr)

Rate (Rs/ kWh)

Total Quantum

(MU)

Total Cost

(Rs Cr)

Rate (Rs/ kWh)

1 APGCL 2,190.19 697.51 3.18 1,281.40 410.24 3.20

2 NEEPCO (HYDRO)

KOPILI I - -

KOPILI II - -

KHANDONG - -

RHEP 501.37 114.04 2.27 626.16 146.28 2.34

DHEP 43.90 30.73 7.00 88.75 48.84 5.50

KAMENG HEP 225.41 104.59 4.64 138.68 55.48 4.00

3 NEEPCO (TH)

AGBPP 875.64 367.37 4.20 884.92 331.73 3.75

AGTPP 257.48 120.32 4.67 376.98 154.21 4.09

AGTPP 2

4 NHPC Existing, Lg HEP 84.43 41.35 4.90 143.69 49.39 3.44

5 NTPC

FARAKKA 209.69 76.95 3.67 239.05 97.91 4.10

KAHELGAON - I 107.28 36.91 3.44 116.06 42.73 3.68

KAHELGAON -II 429.97 149.00 3.47 433.83 151.00 3.48

TALCHER 239.23 36.31 1.52 150.59 53.48 3.55

FARAKKA-III

NTPC (New) BTPS 2,328.93 1,456.42 6.25 2,620.99 1,661.95 6.34

NTPC BTPS III

6 MeECL 0.04 0.07 17.50

7 Pare HEP 173.49 88.78 5.12 210.79 103.74 4.92

8 Suryatap Solar 5.54 4.99 9.01 5.47 5.28 9.65


11.33 12.77 11.27 6.77 9.01 13.31

10 SECI Solar 41.12 25.38 6.17 37.10 23.48 6.33


30.28 9.61 3.17 46.53 21.31 4.58

12 Bilateral Sources/Traders 686.37 293.13 4.27

13 Power Exchanges - - 506.38 164.88 3.26

14 OTPC 1,567.86 484.22 3.09 1,343.03 441.52 3.29


16 Wind Power PTC 105.25 40.87 3.88 98.78 35.83 3.63


Sl. No.

Agency/Source Tariff Order APDCL Submission

Total Quantum

(MU)

Total Cost (Rs

Cr)

Rate (Rs/ kWh)

Total Quantum

(MU)

Total Cost

(Rs Cr)

Rate (Rs/ kWh)

17 SECI Wind 40.48 16.52 4.08 129.36 35.71 2.76

18 Mangdechhu 606.01 253.92 4.19 631.40 272.33 4.31

19 PTC Nikachu

20 SPV Assam 174.76 58.11 3.33 62.90 20.99 3.34

21 Power Swapping Arrangement

Sub-total: 10,254.94 4,228.90 4.12 10,871.90 4,633.12 4.26

22 Renewable Energy Certificate (Solar)

22.17 11.37

23 Renewable Energy Certificate (Non-Solar)

15.59 -

24 UI Pool/Deviation Settlement Mechanism

126.91 47.76 3.76

Sub-total: 10,254.94 4,266.66 4.16 10,998.81 4,692.25 4.27

25 AEGCL Transmission Charges

358.75 0.35 368.43

26 SLDC Charges 9.68


564.04 782.70

TOTAL 10,254.94 5,199.13 5.07 10,998.81 5,843.38 5.31


5.5.5 The Commission has accepted APDCL’s submissions regarding projected energy

availability from existing and new generating stations. The quantum of power purchase

from APGCL is kept in line with the generation approved for APGCL in the APR of FY

2020-21.

5.5.6 The Commission has considered the rate of purchase from various sources based on

the following approach:

a) Cost of power purchase from APGCL to APDCL has been considered same as

the revenue of APGCL considered in APR of FY 2020-21;

b) The Transmission Charges payable to AEGCL and SLDC Charges have been

considered as approved in the respective Tariff Order for FY 2020-21;

c) The Commission has accepted the fixed charges and energy charges considered

by APDCL for CGS (NER and ER);


d) The Commission has considered the actual fixed and variable cost in H1 of FY

2020-21 for other sources, for estimating power purchase cost for FY 2020-21.

e) The Commission has considered the balance quantum of purchase from Power

Exchange to meet the total energy requirement of APDCL, as approved in the

Energy Balance earlier in this Order.

5.5.7 The source-wise power purchase quantum and costs approved by the Commission for

FY 2020-21, is shown in the Table below:


Table 52: Power Purchase Quantum and Cost considered by the Commission for the FY 2020-21

Sl. No.

Agency/Source Tariff Order APDCL Submission APR FY 202021

Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/kWh)

Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/kWh)

Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/ kWh)

1 APGCL 2,190.19 697.51 3.18 1,281.40 410.24 3.20 1,380.69 468.16 3.39

2 NEEPCO (HYDRO)

KOPILI I - - - -

KOPILI II - - - -

KHANDONG - - - -

RHEP 501.37 114.04 2.27 626.16 146.28 2.34 626.16 135.28 2.16

DHEP 43.90 30.73 7.00 88.75 48.84 5.50 88.75 46.77 5.27

KAMENG HEP 225.41 104.59 4.64 138.68 55.48 4.00 138.68 55.48 4.00

3 NEEPCO (TH)

AGBPP 875.64 367.37 4.20 884.92 331.73 3.75 884.92 303.58 3.43

AGTPP 257.48 120.32 4.67 376.98 154.21 4.09 376.98 152.76 4.05

AGTPP 2

4 NHPC Existing LgHEP 84.43 41.35 4.90 143.69 49.39 3.44 143.69 49.39 3.44

5 NTPC

FARAKKA 209.69 76.95 3.67 239.05 97.91 4.10 239.05 92.01 3.85

KAHELGAON - I 107.28 36.91 3.44 116.06 42.73 3.68 116.06 42.41 3.65

KAHELGAON -II 429.97 149.00 3.47 433.83 151.00 3.48 433.83 146.20 3.37

TALCHER 239.23 36.31 1.52 150.59 53.48 3.55 150.59 36.46 2.42

FARAKKA-III

NTPC (New) BTPS 2,328.93 1,456.42 6.25 2,620.99 1,661.95 6.34 2,279.34 1,430.61 6.28


Sl. No.


Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/kWh)

Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/kWh)

Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/ kWh)

NTPC BTPS III

6 MeECL 0.04 0.07 17.50

7 Pare HEP 173.49 88.78 5.12 210.79 103.74 4.92 210.79 105.47 5.00

8 Suryatap Solar 5.54 4.99 9.01 5.47 5.28 9.65 5.47 4.81 8.79


11.33 12.77 11.27 6.77 9.01 13.31 6.77 9.01 13.31

10 SECI Solar 41.12 25.38 6.17 37.10 23.48 6.33 37.10 23.97 6.46


30.28 9.61 3.17 46.53 21.31 4.58 46.53 19.95 4.29


686.37 293.13 4.27 627.20 267.86 4.27

13 Power Exchanges - - 506.38 164.88 3.26 471.29 150.69 3.26

14 OTPC 1,567.86 484.22 3.09 1,343.03 441.52 3.29 1,343.03 456.17 3.40

15 HHPCPL (Champawati) 5.26 2.16 4.11 5.92 2.67 4.51 5.92 2.41 4.11

16 Wind Power PTC 105.25 40.87 3.88 98.78 35.83 3.63 98.78 40.43 4.09

17 SECI Wind 40.48 16.52 4.08 129.36 35.71 2.76 129.36 37.59 2.91

18 Mangdechhu 606.01 253.92 4.19 631.40 272.33 4.31 631.40 265.16 4.20

19 PTC Nikachu

20 SPV Assam 174.76 58.11 3.33 62.90 20.99 3.34 62.90 14.70 2.34

21 Power Swapping Arrangement

Sub-total 10,254.94 4,228.90 4.12 10,871.90 4,633.12 4.26 10,535.28 4,357.33 4.14

22 Renewable Energy Certificate (Solar)

22.17 11.37 13.34


Sl. No.


Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/kWh)

Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/kWh)

Total Quantum

(MU)

Total Cost (Rs Cr)

Rate (Rs/ kWh)

23 Renewable Energy Certificate (Non-Solar)

15.59 - 10.26


126.91 47.76 3.76 126.91 47.76 3.76

Sub-total: 10,254.94 4,266.66 4.16 10,998.81 4,692.25 4.27 10,662.19 4,428.69 4.15


358.75 0.35 368.43 377.81



564.04 782.70 782.70

28 TOTAL 10,254.94 5,199.13 5.07 10,998.81 5,843.38 5.31 10,662.19 5,593.88 5.25

Therefore, the Commission considers total Power Purchase Cost of Rs. 5593.88 Crore in the APR for FY 2020-21.


5.6 Operation and Maintenance (O&M) Expenses

5.6.1 The O&M expenses comprise Employee Expenses, R&M Expenses and A&G

Expenses.

5.6.2 Employee Expenses

APDCL has adopted the following approach for estimating Employee Cost:

a) The employee expenses arrived at in the true-up for FY 2019-20 have been

considered as base expenses for FY 2020-21;



c) Growth factor has been considered as 0% against approved growth factor of 1%,

as no recruitment has been done.

The Employee Cost as projected by APDCL:

Table 53: Employee Expenses projected for FY 2020-21 by APDCL (Rs. Crore)


dtd.07.03.2020 APDCL

Employee Expenses for Previous Year 740.33 733.00

Growth Factor 1% 0%

CPI Inflation 4.22% 5.30%


APDCL has projected the Employee expenses of Rs.771.83 Crore for FY 2020-21.

5.6.3 Repair and Maintenance (R&M) Expenses

APDCL has proposed R&M expenses based on of Regulation 37 the MYT Regulations,

2018. APDCL has considered the value of ‘K’ of 3.50% as considered in the last Tariff

Order, and WPI as 2.96%. The R&M expenses projected by APDCL are shown in the

Table below:

Table 54: R&M Expenses for FY 2020-21 as submitted by APDCL (Rs. Crore)



GFA for previous year 4,771.75 5,107.10




K Factor 3.50% 3.50%


R&M Expenses 171.98 184.05

APDCL has projected the R&M expenses at Rs.184.05 Crore for FY 2020-21.

5.6.4 Administrative and General (A&G) Expenses

APDCL has proposed A&G expenditure based on Regulation 37 of the MYT

Regulations, 2018. APDCL has considered WPI of 2.96% and considered the

approved provision of Rs. 2 Crore in FY 2020-21. Statutory Fees have been

considered as Rs. 1.61 crore as per actuals of FY 2019-20 as against approved

amount of Rs. Rs. 3.74 crore. APDCL submitted that an amount of Rs. 3.50 crore has

been considered against the approved Special Fund of Rs. 10 crore for metering for

Energy Audit on the basis of actual works awarded till date. APDCL submitted that

many works could not be awarded due to COVID protocols. The A&G expenses

projected by APDCL are shown in the Table below:

Table 55: A&G Expenses for FY 2020-21 as submitted by APDCL (Rs. Crore)



A&G Expenses for Previous Year 37.63 39.86


Provision 2.00 2.00

Statutory fees 3.74 1.61

Special fund for metering and

energy audit 10.00 3.50


APDCL has projected the A&G expenses at Rs.48.15 Crore for FY 2020-21.


5.6.5 The Commission has computed the normative O&M Expenses for FY 2020-21 as per

the MYT Regulations, 2018. Any variation between normative O&M expenses and

actual O&M Expenses shall be considered under sharing of gains and losses on

account of controllable items as per Regulation 12 of the MYT Regulations, 2018 at

the time of truing up for FY 2020-21.


Employee Expenses

5.6.6 For computation of employee expenses for FY 2020-21, the Commission has adopted


a) The employee expenses approved after True-Up for FY 2019-20 have been




c) The growth factor has been considered as 0%, due to reduction in number of

employees rather than the projected increase in number of employees.

5.6.7 Accordingly, the normative employee expenses approved in the APR for FY 2020-21

are shown in the following Table:

Table 56: Employee Expenses considered for FY 2020-21(Rs. Crore)

Particulars

Tariff Order

dtd.

07.03.2020

APDCL Approved

in APR

Employee Expenses for Previous Year 740.33 733.00 733.00


CPI Inflation 4.22% 5.30% 5.35%

Total Employee Expenses 779.26 771.83 772.24

Accordingly, the Commission approves Employee Expenses of Rs. 772.24 Cr in

the APR for FY 2020-21.

R&M Expenses

5.6.8 For computation of R&M Expenses for FY 2020-21, the Commission has considered


a) The Commission has considered the average increase of WPI index of FY 2017-

18 to FY 2019-20, i.e., 2.96% for computation of R & M expenses;

b) K-factor has been considered as 3.50% as approved in Tariff Order;

c) Since, K-factor has been computed on the basis of average GFA, for working out

R&M expenses for FY 2020-21, average GFA for previous year has been

considered.

5.6.9 The normative R&M expenses approved in the APR for FY 2020-21 are shown in the


following Table:

Table 57: R&M Expenses considered for FY 2020-21 (Rs. Crore)


dtd. 07.03.2020 APDCL

Approved in

APR

Average GFA for previous year 4771.75 5,107.10 5,107.10

K Factor 3.50% 3.50% 3.50%

WPI Inflation 2.97% 2.96% 2.96%

R&M Expenses 171.98 184.05 184.04

Therefore, the Commission approves R&M Expenses of Rs. 184.04 crore in the

APR for FY 2020-21.

A&G Expenses

5.6.10 For computation of A&G expenses for FY 2020-21, the Commission has adopted the

following approach:

a) The A&G expenses approved after Truing up for FY 2019-20 have been


b) Similar to R&M expenses, WPI inflation has been considered as 2.96%;

c) For APR of FY 2020-21, the Commission has considered a provision of Rs. 2

Crore, as approved in the Tariff Order dated March 7, 2020;

d) The actual statutory fees of Rs. 1.61 crore of FY 2019-20 have been considered

as a separate pass-through item, and added to the normative A&G expenses

computed for FY 2020-21 as above;

e) The Special Fund for metering for Energy Audit has been considered as Rs. 3.50

crore, as estimated by APDCL, against the amount of Rs. 10 crore approved in the

Tariff Order dated March 7, 2020, in view of the reduced expenses on account of

COVID protocols.

5.6.11 The normative A&G expenses approved in the APR for FY 2020-21 are shown in the

following Table:


Table 58: A&G Expenses considered for FY 2020-21 (Rs. Crore)

Particulars

Tariff Order


Approved

in APR

A&G Expenses for Previous Year 37.63 39.86 37.63

WPI Inflation 2.97% 2.96% 2.96%

Provision 2.00 2.00 2.00

Statutory Fees 3.74 1.61 1.61

Special Fund for metering for Energy Audit 10.00 3.50 3.50

A&G Expenses 54.49 48.15 45.86

Therefore, the Commission approves A&G Expenses of Rs. 45.86 crore in the

APR for FY 2020-21.

5.7 Capital Investment and Financing of Capital Investment

5.7.1 APDCL submitted that it has estimated the capital expenditure and capitalisation in

APR for FY 2020-21 based on the estimates of the capital expenditure works carried

on till date vis-à-vis budgetary allocation and pending CWIP.

5.7.2 APDCL has projected total Capital Expenditure and Capitalisation of Rs. 503.97 Crore

and Rs. 2641.91 Crore, respectively, during FY 2020-21. APDCL proposed to fund the

capitalisation of Rs. 2641.91 Crore during FY 2020-21, as shown in the Table below:

Table 59: Proposed financing of Capitalization for FY 2020-21 (Rs. Crore)

Particulars Amount

Debt 430.51

Equity 0.00

Grant 2211.40

Total 2641.91


5.7.3 The Commission has verified the actual capitalization achieved by APDCL in the past

three years, i.e., FY 2017-18 to FY 2019-20, as shown in the Table below:

Table 60: Actual Capitalization for FY 2017-18 to FY 2019-20 (Rs. Crore)

Particulars FY 2017-18 FY 2018-19 FY 2019-20

Actual

Capitalisation 211.46 611.93 1343.09


5.7.4 As seen from the above Table, based on the actual capitalization of last three years,

it can be observed that capitalisation is showing an increasing trend. In FY 2019-20,

actual capitalisation of APDCL was Rs.1343.09 Crore. In reply to the Commission’s

query regarding the delay in capitalisation due to impact of COVID, APDCL submitted

that a delay of around 6 months is expected in execution of Projects due to COVID.

Hence, the Commission has considered 50% of capitalisation estimated by APDCL for

FY 2020-21, i.e., Rs. 1320.96 Crore, which appears realistic, as it is very close to the

actual capitalisation achieved in FY 2019-20.

5.7.5 It is clarified that APDCL is at liberty to achieve capitalisation higher than the

considered amount. The Commission will approve the Capitalisation at the time of

truing up, subject to prudence check.

5.7.6 The Commission has not considered any equity funding of the estimated capitalisation,

based on APDCL’s submissions, and has considered the capitalisation to be funded

through Grants and Debt in the standard ratio of 90:10, based on past experience.

5.7.7 The Capitalisation and funding of Capitalisation approved by the Commission in the

APR of FY 2020-21, is given in the Table below:

Table 61: Capitalization and Funding for FY 2020-21 (Rs. Crore)


dtd.07.03.2020

APDCL Approved by

Commission

Grant 585.00 430.51 1188.86

Equity 0.00 0.00 -

Debt 65.00 2211.40 132.10

Total Capitalisation 650.00 2641.91 1320.96

Therefore, the Commission provisionally approves Capitalisation of Rs. 1320.96 crore

in the APR for FY 2020-21.

5.8 Depreciation

5.8.1 The Commission had approved depreciation of Rs. 24.22 Crore for FY 2020-21 in line

with the depreciation rates specified in MYT Regulations, 2018.

5.8.2 APDCL submitted that Depreciation has been claimed in accordance with the MYT

Regulations, 2018, after apportionment of depreciation for assets created out of


Consumer Contribution and Grants. APDCL added that the assets, which have been

depreciated to the extent of 90% of original cost are excluded from the asset base for

the purpose of calculating depreciation.

5.8.3 Total amount of depreciation claimed by APDCL is Rs. 42.67 Crore after adjustment

of funding from grant of Rs. 49.50 Crore.The depreciation projected by APDCL for FY

2020-21 is shown in the Tables below:


Table 62: Depreciation calculation for FY 2020-21 as submitted by APDCL (Rs. Crore)

Particulars

Gross Fixed Assets Depreciation

As on

01.04.20

Net addition

during the

year

Rate of

Depreciation

Assets fully

depreciated

On

Opening

Balance

On

Addition Total

Land & Rights

i) Land owned under full title 18.74 0.16 - - -

ii) Leasehold land 2.84 2.98 3.34% 0.09 0.04 0.13

Subtotal: 21.58 3.14

- 0.09 0.04 0.13

Building 56.97 1.11 3.34% 7.32 1.49 0.02 1.51

Hydraulic - -

- - -

Other Civil Works 58.62 1.94 3.34% 5.91 1.58 0.03 1.61

Plant & Machinery 723.62 83.84 5.28% 213.74 24.23 26.22

Lines & Cable Network 1,316.91 334.27 5.28% 442.45 41.55 7.94 49.50

Vehicles 27.25 0.50 5.28% 11.34 0.76 0.01 0.77

Furniture & Fixtures 18.23 0.64 6.33% 9.98 0.47 0.02 0.49

Office Equipment 35.61 5.00 6.33% 23.57 0.69 0.14 0.83

SUB TOTAL 2,258.79 430.45 3.59% 714.31 70.86 10.20 81.06

Add: Consumers

contribution etc 233.81 0.13 5.28% 11.11 0.00 11.11

Add: Assets not belonging to

the entity 3,286.06 2,211.33

- -

5,778.65 2,641.91 714.31 81.97 10.20 92.17


Table 63: Depreciation claimed by APDCL for FY 2020-21 (Rs. Crore)

Particulars

State Govt. grant

Grant for assets not

belonging to entity

(RGGVY, MNRE etc.)

Consumer

Contribution Total

As on

01.04.2005

As on

01.04.2020 Sub total As on 01.04.2020


GFA (excluding Consumer

Contribution and assets not

belonging to company)

765.43 1,493.36 2,258.79 3,286.06 233.81 5,778.65

CWIP 330.20 3,252.45 3,582.65 2,211.33

5,793.98

Total 1,095.63 4,745.81 5,841.44 5,497.39 233.81 11,572.64

Cumulative grants apportioned in

the ratio of GFA and CWIP

GFA - 1,379.33 1,379.33 3,737.09 233.81 5,350.23

CWIP - 3,004.10 3,004.10 2,514.85 5,518.95

Total - 4,383.43 4,383.43 6,251.95 233.81 10,869.18

Depreciation calculated as per the

Regulation on the GFA 27.47 53.59 81.06 - 11.11 92.17

Weighted Average Rate of

Depreciation (%) 3.59% 3.59% 3.59% - 4.75% 1.59%

Depreciation to be deducted on the

assets built on the grants

componentvalue

- 49.50 49.50 - 49.50




5.8.4 For computation of depreciation, the Commission has considered the closing GFA for

FY 2019-20 as approved in this Order as the Opening GFA for FY 2020-21. The

capitalisation approved for FY 2020-21 has been considered as asset addition during

the year. The Commission has considered the scheduled depreciation rates as

specified in MYT Regulations, 2018.

5.8.5 As per the MYT Regulations, 2018, the total depreciation during the life of the asset

shall not exceed 90% of the original cost of GFA. The Commission has computed the

depreciation separately for assets added under each asset head in each 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 has not considered depreciation on assets funded through grants and

consumer contribution, in accordance with Regulations 30 and 32 of MYT Regulations,

2018.

5.8.6 In view of the above, the Commission has approved depreciation in the APR for FY

2020-21 as per MYT Regulations, 2018, as given in the Table below:

Table 64: Depreciation considered for FY 2020-21 (Rs. Crore)

Sl. Particulars Opening

GFA

Addition

during

the year

Rate of

depreciation

Depreciation

as per MYT

Regulations,

2018

1 Land & Rights 18.75 0.34 -

2 Leasehold Land 2.84 - 3.34% 0.09

3 Building 56.96 2.37 3.34% 1.94

4 Plant & Machinery 723.62 12.27 5.28% 27.21

5 Vehicle 27.24 - 5.28% 1.47



8 Other Civil Work 58.62 4.14 3.34% 2.03


10 Total 2,258.78 132.10 86.54




14 Less: Depreciation for Grants 82.53



Accordingly, the Commission approves Depreciation of Rs. 4.02 crore in the APR for

FY 2020-21.

5.9 Interest on Loan Capital

5.9.1 The Commission had approved normative interest and finance charges of

Rs. 37.24 Crore in the Tariff Order for FY 2020-21.

5.9.2 APDCL submitted that it has projected interest on loan capital based on the existing

source-wise outstanding loans, repayment schedule and prevailing interest rates.

Presently, APDCL has loans from GoA and PFC. In order to reduce interest burden

and to achieve financial turnaround, APDCL has joined UDAY Scheme. The UDAY

MoU was executed on 4th January, 2017 and conversion of GoA loan into grant and

equity has materialized in FY 2020-21 with all approvals in place.

5.9.3 APDCL has claimed interest and finance charges in line with the approach followed in

Tariff Orders with addition of Bank Charges and Charges paid to Billdesk for online

payment facilitation to consumers. Bank charges, etc., have been projected with 5%

escalation over actuals of FY 2019-20. With more consumers availing digital platforms,

estimated facilitation charges to Billdesk have been escalated by 15% over actuals of

FY 2019-20.

5.9.4 Accordingly, APDCL has submitted interest expenses for FY 2020-21 as shown in the

Table below:

Table 65: Interest Expenses as submitted by APDCL for FY 2020-21 (Rs. Crore)


dtd. 07.03.2020

APDCL

Net Normative Opening Loan 684.36 593.70

Addition of normative loan during the year (619.36) 430.51

Normative Repayment during the year 24.22 42.67

Net Normative Closing Loan 40.78 981.54

Interest Rate 9.40% 10.74%

Interest Expenses 34.08 105.40

Other Finance Charges 3.16 2.81

Billdesk Charges for collecting Revenue 2.90

Total Interest and Finance Charges 37.24 111.12


APDCL has claimed Interest Expenses of Rs.111.12 Crore for FY 2020-21.


5.9.5 Interest on loan for FY 2020-21 is required to be allowed on normative basis as per

Regulation 34 of MYT Regulations, 2018. Accordingly, the normative closing loan for

FY 2019-20 of Rs. 692.86 Crore is considered as the normative loan outstanding as

on April 1, 2020.

5.9.6 The Commission has considered the normative addition of loan during FY 2020-21

towards capitalisation, as Rs. 132.10 Crore, as stated earlier. Under the UDAY MoU,

which has finally materialised in FY 2020-21 as confirmed by APDCL, the GoA has

converted 75% of the outstanding loans on APDCL’s books as on September 2015

(i.e., Rs. 849.40 Crore) into Grants, and the balance 25% of the outstanding loans as

on September 2015 (i.e., Rs. 283.13 Crore) has been converted into equity. However,

the Commission allows interest expenses on normative basis, and the outstanding

opening loans for FY 2020-21 are only Rs. 692.86 Crore. As the amount of loans

converted to Grants by GoA is higher than the outstanding opening loans for FY 2020-

21, the entire opening loan of Rs. 692.86 Crore has been considered as converted to

Grant by the GoA under UDAY MoU, in order to pass on the benefits of this loan

conversion to Grant to the intended beneficiaries, i.e., the consumers. Hence, the net

loan reduction in FY 2020-21 works out to Rs. 560.76 Crore (Rs. 692.86 Crore – Rs.

132.10 Crore), which has been considered for computing the normative interest

expenses for FY 2020-21.

5.9.7 The loan repayment has been considered equivalent to depreciation approved for FY

2020-21 in this Order. The Commission has considered the Interest rate of 10.00% for

new loans, in accordance with the UDAY MoU.

5.9.8 The Other Financing Charges and Billdesk Charges have been escalated by 5% over

the actual amounts incurred in FY 2019-20, for estimating the expenses for FY 2020-

21.

5.9.9 The interest on loan capital approved by the Commission in the APR for FY 2020-21

is shown in the following Table:


Table 66: Interest on Loan Capital considered for FY 2020-21 (Rs. Crore)


dtd. 07.03.2020

APDCL Approved in

APR


Addition of normative loan during the year (619.36) 430.51 (560.76)



Interest Rate 9.40% 10.74% 10.00%


Other Finance Charges 3.16 2.81 2.81

Bill Desk Charges for collecting Revenue 2.90 2.65

Total Interest and Finance Charges 37.24 111.11 46.51

Therefore, the Commission approves Interest Expenses of Rs. 46.51 Crore in the

APR for FY 2020-21.


5.10.1 APDCL submitted that it has projected IoWC on normative basis as per MYT

Regulations, 2018. For the purpose of APR of FY 2020-21, APDCL has not claimed

any interest on working capital, as the normative working capital requirement works

out to be negative.

5.10.2 Commission’s Analysis

5.10.3 The Commission has computed IoWC in accordance with Regulations 36.3 and 36.4

of the MYT Regulations, 2018. In line with the approach followed in the true-up for FY

2019-20, the expenses on account of power purchase from Power Exchanges have

not been reduced, while reducing the power purchase expenses, as advance payment

has to be made to the Power Exchanges. The normative interest rate has been

considered as SBI MCLR (one-year tenor) plus 300 basis points, i.e., 10.00%.

5.10.4 The IoWC approved by the Commission in the APR for FY 2020-21 is shown in the

following Table:


Table 67 : IoWC considered by the Commission for FY 2020-21 (Rs. Crore)

Particulars MYT

Order APDCL

Approved

in APR

One month of the amount of O&M expenses 83.81 83.67 83.51

Maintenance spares @15% of O&M expenses 150.63 150.60 150.32

Two months equivalent of expected revenue

from sale of electricity

921.24 840.73 912.32

Less: One-month Power Purchase Cost 433.26 473.21 453.60

Less: Amount held as CSD 850.73 722.07 763.51

Total Working Capital Requirement (128.31) (120.28) (70.95)

Rate of Interest 11.50% 10.91% 10.00%

Interest on Working Capital - - -

Therefore, the Commission considers IoWC as Nil in the APR for FY 2020-21.

5.11 Interest on Consumers’ Security Deposit

5.11.1 APDCL submitted that with successful roll out of software facilitating automatic

adjustment of interest on CSD in energy bills, the liquidation of liability on such account

has significantly increased. Considering the improving trend, an amount of Rs. 38.06

Crore (actuals for FY 2019-20) is estimated as interest on CSD in the APR for FY

2020-21.

5.11.2 Commission’s Analysis

5.11.3 The Commission has considered the submission of APDCL for FY 2020-21. The

Commission, therefore, approves interest on CSD of Rs. 38.06 Crore in the APR of

FY 2020-21.

5.12 Provision for Bad and Doubtful Debts

5.12.1 APDCL has projected the Provision for Bad & Doubtful Debts of Rs. 22.10 Crore in

line with the amount for FY 2019-20.


5.12.2 For the purpose of APR, the Commission has considered the provision for bad &


doubtful debts at the same level as the Trued-up amount for FY 2019-20, i.e., Rs 22.10

Crore, as the cumulative provisioning of bad and doubtful debts is lower than the

ceiling limit of 5% of receivables. The provision for bad & doubtful debts will be finally

approved at the time of truing up when actual data is available.


5.13.1 APDCL has submitted that the authorized share capital of APDCL has been enhanced

to Rs. 5000 Crore to materialize the conversion of loan/grant to equity. APDCL

submitted that the GoA has also accorded approval for conversion of loan worth Rs.

283 Crore under UDAY and Grant worth Rs. 1261 Crore to equity. APDCL has

accordingly claimed RoE of Rs. 156.69 Crore in the APR for FY 2020-21.


5.13.2 The Commission has verified the documentary evidence submitted by APDCL for the

conversion of Grants worth Rs. 1261 crore to Equity by the GoA in FY 2020-21.

5.13.3 In this regard, it should be noted that in accordance with the applicable Tariff notified

by the Commission for different periods, the capitalisation till date has been approved

based on the typical funding of 90:10 Grant:Debt, with zero equity funding. The

Commission’s with the applicable Tariff specify that the Debt:Equity funding of

capitalisation is to be considered, after reducing the capital cost to the extent of funding

from Grant/Consumer Contribution. Further, equity funding can be considered up to

maximum of 30% of the balance capitalisation to be funded, irrespective of the actual

equity invested by the Licensee.

5.13.4 The conversion of Grants to Equity by the GoA in FY 2020-21 has to accordingly be

considered in accordance with the Commission’s MYT Regulations,2018. The GoA

has converted Grants worth Rs. 1261 Crore to equity, out of the total average Grants

of Rs. 6118.74 Crore in FY 2020-21. Hence, the balance Grant funding available to

fund the Average GFA of Rs. 6439.12 Crore works out to Rs. 4857.74 Crore, i.e., the

GFA to be funded by Debt:Equity is Rs. 1581.38 Crore. Considering maximum 30%

equity funding, the maximum equity funding allowable works out to Rs. 474.41 Crore.

As the Opening Equity of Rs. 162.77 Crore has already been allowed by the

Commission in the Tariff Orders, the maximum additional equity that can be


considered for tariff computation purposes, on account of conversion of Grants to

Equity, thus, works out to Rs. 311.64 Crore, as shown in the Table below:

Table 68: Equity Addition allowed by the Commission due to Conversion of Grant to

Equity in FY 2020-21 (Rs. Crore)

5.13.5 The Commission has accordingly considered equity addition of Rs. 311.64 Crore in

FY 2020-21, and approved the RoE in accordance with MYT Regulations, 2018. The

Commission has considered the addition of Nil equity towards new Capitalisation for

FY 2020-21, based on the funding of capitalisation approved in this Order. Therefore,

the computation of RoE for FY 2020-21 at 16% is shown in the Table below:

Table 69: Return on Equity considered by the Commission for FY 2020-21 (Rs. Crore)

Therefore, the Commission considers RoE of Rs. 50.97 crore in the APR for FY

2020-21.

5.14 Other Income

5.14.1 APDCL has projected Other Income for FY 2020-21, on the basis of actuals for FY

Sr.

No. Particulars

Approved

in APR

1 Average GFA 6,439.12


3 Grants converted to Equity 1261.00

4 Net Grant towards GFA 4,857.74

5 Net GFA to be funded 1,581.38

6 Maximum Equity that can be considered 474.41

7 Equity already allowed 162.77

8 Equity that can be additionally allowed 311.64

Sr.

No. Particulars

Tariff

Order dtd.

07.03.2020

APDCL Approved

in APR

1 Opening Equity Capital 162.77 162.77 162.77

2 Equity addition during the year 1,633.06 311.64

3 Closing Equity 162.77 1,795.83 474.41

4 Average Equity 162.77 979.30 318.59

5 Rate of Return on equity 16.00% 16.00% 16.00%

6 Return on Equity 26.04 156.69 50.97


2019-20, except for the following:

(a) Miscellaneous receipt has been escalated by 5%;

(b) Seasonal export is estimated based on surplus energy estimate for FY 2020-

21 at the rate of Rs. 2.35/kWh (off-peak/night hours);

(c) Considering the high attrition ratio, receipt from pension trust is considered with

3% decline.

5.14.2 APDCL has projected Other Income for FY 2020-21, as shown in the Table below:

Table 70: Other Income as submitted by APDCL for FY 2020-21 (Rs. Crore)


dtd. 07.03.2020 APDCL

Interest on fixed deposits 143.01 94.09

Income from Trading 165.16 386.00

Income from Sale of Scrap 0.23

Revenue from sale of LED's, Tubelight, Fan, etc. 5.97 0.92

Rent from residential buildings 0.02 0.02

Receipt from Pension Trust 73.24 65.09

Miscellaneous receipts 129.52 44.80

Total 516.92 591.16

APDCL has estimated ‘Other Income’ of Rs. 591.16 Crore in the APR for FY 2020-21.


5.14.3 The Commission has projected the Other Income for FY 2020-21, by considering an

increase of 5% over the Trued-Up Other Income during FY 2019-20, except for Interest

on Fixed Deposits and income from sale of scrap, and receipt from Pension Trust,

which have been considered at FY 2019-20 levels. The revenue from sale of surplus

energy has been considered as per the approved Energy Balance for FY 2020-21. The

per unit rate for sale of surplus power has been considered at Rs. 2.52 per unit, i.e.,

actual rate for sale of surplus power in FY 2019-20.

5.14.4 The Commission has approved Other Income in the APR for FY 2020-21 as shown in

the Table below:


Table 71: Other Income considered for FY 2020-21 (Rs. Crore)

Particulars

Tariff Order

dtd.

07.03.2020

APDCL Approved

in APR

Interest on fixed deposits 143.01 94.09 94.09

Income from Trading 165.16 386.00 413.86


Revenue from sale of LED's, Tubelight,

Fan, etc.

5.97 0.92 0.11

Rent from residential buildings 0.02 0.02 0.02

Receipt from Pension Trust 73.24 65.09 67.10

Miscellaneous receipts 129.52 44.80 44.80

Total 516.92 591.16 620.21

Therefore, the Commission has estimated Other Income of Rs. 620.21 crore in

the APR for FY 2020-21.


5.15.1 APDCL submitted that it has projected NTI considering escalation of 5% over the NTI

of FY 2019-20, except for the following heads:

(a) Delayed Payment Charge is reduced by 5% considering the COVID relaxation

by the Commission;

(b) Inclusion of rebate from CPSU Gencos in line with Advisory from MoP;

(c) STOA credit on PoC bill, income from reactive power as well as SCED are kept

at same level of FY 2019-20, considering the uncertainty.

5.15.2 Accordingly, APDCL estimated NTI of Rs. 450.63 Crore for FY 2020-21, as shown in

the Table below:

Table 72: Non-Tariff Income as submitted by APDCL for FY 2020-21 (Rs. Crore)

Particulars

Tariff

Order dt.

07.03.2020 APDCL

Meter Rent 24.73 23.17

Compensation charges for theft of

energy/malpractices

1.86 0.40

Cross Subsidy surcharge on Open Access Consumer 31.27 35.48

Wheeling Charges collected 5.92 4.55

Short-term Open Access Credit 60.06


Particulars

Tariff

Order dt.

07.03.2020 APDCL

Rebate on PP bills 21.12 82.73

Miscellaneous Recoveries 21.68 22.51

Other Miscellaneous and General Charges

a) Delayed payment charges 190.78 216.16

b) Income on Reactive Power 0.21

c) Income from SCED 5.36

Grand Total 297.36 450.63


5.15.3 The Commission has considered annual increase of 5% over the approved NTI for FY

2019-20, except for the following heads of NTI:

(a) Meter rent, short-term OA Credit, and Miscellaneous Income, which have been

considered at the same level as in FY 2019-20;

(b) The rebate received by APDCL due to prompt payment on power purchase bills

has not been considered, in accordance with the approach elaborated in the

truing-up for FY 2019-20;

(c) The rebate of Rs. 69.99 crore received from CPSU’s in accordance with the

MoP Advisory has been considered, in order to pass on the benefit of the same

to the intended beneficiaries, i.e., the consumers;

(d) The income from DPC has been considered lower by 5%, based on the

rationale proposed by APDCL.

5.15.4 The following Table shows the Non-Tariff Income approved in the APR for FY 2020-

21:

Table 73: Non-Tariff Income as considered by Commission for FY 2020-21 (Rs. Crore)

Particulars

Tariff

Order dtd.

07.03.2020

APDCL Approved

in APR

Meter Rent 24.73 23.17 23.17

Compensation charges for theft of energy 1.86 0.40 0.40

Cross Subsidy Surcharge on Open Access

Consumer

31.27 35.48 35.48

Wheeling Charges 5.92 4.55 4.55

Short-term Open Access Credit 60.06 60.06

Rebate on PP bills 21.12 82.73 69.99

Miscellaneous Recoveries 21.68 22.51 22.51


Particulars

Tariff

Order dtd.

07.03.2020

APDCL Approved

in APR


(specify)

-

a) Delayed payment charges 190.78 216.16 228.16



Grand Total 297.36 450.63 449.89

Accordingly, the Commission has considered Non-Tariff Income of Rs. 449.89

Crore in the APR for FY 2020-21.

5.16 Revenue from sale of electricity at existing Tariff

5.16.1 APDCL has considered the revenue from sale of electricity for FY 2020-21, based on

approved tariff and the consumer profile. APDCL has considered the full-cost tariff,

without considering any targeted subsidy, for the purposes of estimating the revenue

from sale of electricity at existing tariff. Accordingly, APDCL has projected the Revenue

from Sale of Power at existing tariffs for FY 2020-21, as Rs. 5344.36 Crore.


5.16.2 The Commission has estimated the Revenue from sale of electricity at existing tariff

based on the applicable tariff, as per the Tariff Order dated March 7, 2020, and the

projected category-wise sales for FY 2020-21. The Commission has considered the

full-cost tariff, without considering any Targeted Subsidy, for the purposes of

estimating the revenue from sale of electricity at existing tariff.

5.16.3 The Revenue from Sale of Electricity from existing tariff has been computed by

the Commission as Rs. 5,473.94 Crore in the APR for FY 2020-21.

5.17 Other Subsidy from GoA

5.17.1 APDCL has submitted that although GoA vide No. PEL.323/2015/160 dated

04.03.2020 has committed Other Subsidy of Rs. 400 Crore, budgetary allocation was

made for Rs. 300 Crore only, and supplementary demand for balance Rs. 100 Crore

is being processed. In the absence of approval of supplementary demand, actual


budgeted amount of Rs. 300 Crore has been considered by APDCL.


5.17.2 The GoA has committed power purchase subsidy of Rs. 400 Crore against power

purchase dues for FY 2020-21. As the Commission has considered the entire power

purchase cost in the ARR, the Commission has considered the entire subsidy

commitment of Rs. 400 Crore, rather than Rs. 300 Crore as considered by APDCL.

5.18 ARR and Revenue Gap/(Surplus)

5.18.1 Considering the above heads of expense and revenue provisionally approved in the

APR for FY 2020-21, the summary of ARR and Revenue Gap/(Surplus) approved by

the Commission in the APR for FY 2020-21 is given in the Table below:

Table 74 :ARR & Revenue Gap/ (Surplus) considered by the Commission for FY 2020-

21 (Rs. Crore)

Sl. No.

Particulars Tariff Order dt. 07.03.2020

APDCL Approved in APR

1 Power Purchase Expenses 5,199.13 5,843.38 5,593.88

2 O&M Expenses 1,005.73 1,004.03 1,002.14


b) R&M Expenses 171.98 184.05 184.04

c) A&G Expenses 54.49 48.15 45.86

3 Depreciation 24.22 42.67 4.02


5 Interest on Working Capital - - -

6 Interest on CSD 33.85 38.06 38.06

7 Return on Equity 26.04 156.69 50.97

8 Provisioning for Bad & Doubtful Debts 15.52 22.10 22.10





13 Revenue Gap after True Up of FY 2018-19

525.45 525.45

14 Net Carrying Cost 123.74 123.74

15 Impact of True-Up of APGCL for FY 2019-20, along with holding cost

(20.40) (20.40)

16 Impact of True-Up of AEGCL for FY 2019-20, along with holding cost

(5.32) (5.32)

17 Net ARR 6,150.91 6,176.25 6,311.04

18 Revenue at Approved Tariff 6,150.91 5,344.36 5,473.94


Sl. No.

Particulars Tariff Order dt. 07.03.2020

APDCL Approved in APR

19 Power Purchase Subsidy 300.00 400.00

20 Total Revenue including Subsidy 6,150.91 5,644.36 5,873.94

21 Cumulative Revenue Gap/(Surplus) - 531.91 437.11

Accordingly, the Commission has arrived at a Revenue Gap of Rs 437.11 Crore in

the APR of FY 2020-21. The same has not been adjusted in this Order, as this is

only a provisional number. The Revenue Gap/(Surplus) after true-up for FY 2020-21

shall be adjusted in the ARR of FY 2022-23.


6 ARR for FY 2021-22

6.1 Introduction

6.1.1 This Chapter deals with the determination of ARR for FY 2021-22, in accordance with

the provisions of MYT Regulations, 2018 and the submissions made by APDCL.

6.2 Energy Sales

6.2.1 Appropriate estimation of category-wise energy sales for the year is essential to arrive

at the quantum of power to be purchased and the likely revenue from sale of energy.

This Section examines in detail the consumer category-wise energy sales projected by

APDCL in its Tariff Petition and the category-wise sales approved by the Commission

for FY 2021-22.

6.3 Category-Wise Energy Sales

6.3.1 APDCL submitted that the projections of energy sales for FY 2021-22 have been

revised based on actual energy sales for FY 2019-20 and average of decadal

Compounded Annual Growth Rate (CAGR). APDCL added that consumption for FY

2020-21 is significantly affected in the wake of COVID and the sales are expected to

remain almost at the FY 2019-20 levels.

6.3.2 In this backdrop and considering gradual resumption of economic activities, APDCL

has projected sales for FY 2021-22 based on appropriate CAGR over FY 2019-20

levels and not on estimated sales for FY 2020-21.

6.3.3 APDCL has considered actual addition of households under SAUBHAGYA vis-à-vis

extension thereon. Due to proper implementation of the Commission’s directive

regarding switching over of Jeevan Dhara consumers to Domestic-A category once

the consumption exceeds the threshold limit of 30 kWh/month; sharp decline in Jeevan

Dhara consumption has been recorded. Hence, for better estimates, Jeevan Dhara

and Domestic-A category have been considered as a block.

6.3.4 The category-wise sales projected by APDCL for FY 2021-22 are given in the Table

below:


Table 75: Category-wise Energy Sales Projected by APDCL for FY 2021-22 (MU)


6.3.5 As stated in the APR of FY 2020-21, the Commission has accepted the category-wise

sales projected by APDCL, in view of the COVID impact, which has disrupted the past

patterns of consumption. Hence, for assessing the trend of growth in consumption, the

Commission has excluded the FY 2020-21 estimates, and considered the trued-up

category-wise sales for FY 2019-20 as the base figure.

Consumer Category

MYT

Order dtd.

01.03.2019

APDCL

JEEVAN DHARA 869 479

DOMESTIC A - below 5 kW 3974 3,611

Domestic-B - 5 kW and above up to 25 kW 407 451

Commercial Load above 0.5 kW and up to 25 kW 738 887



Agriculture up to 25 kW 34 49


Small Industries Urban up to 25 kW 30 37

LT Electric Vehicles Charging Stations 0 -

Temporary 12 6

LT TOTAL 6,256 5,782

HT Domestic above 25 kW (30 kVA) 31 21

HT Commercial above 25 kW (30 kVA) 415 393

Public Water Works 71 86

Bulk Supply Govt. Edu Inst above 25 kW (30 kVA) 76 82

Bulk Supply Others above 25 kW (30 kVA) 399 394

HT Small Industries above 25 kW (30 kVA) and up

to 50 kVA

23 19

HT Industries-I 50 kVA to 150 kVA 67 110

HT Industries-II above 150 kVA 908 931

Tea Coffee & Rubber 624 466

Oil & Coal 76 67

HT Irrigation Load above 25 kW (30 kVA) 15 15

HT Temporary - -

HT Electric Crematorium 0.5 -

HT Electric Vehicles Charging Station - -

HT TOTAL 2,706 2,585

TOTAL 8,962 8,366


6.3.6 The 2-year, 3-year, 4-year, 5-year CAGR has been computed along with the Y-o-Y

growth seen in the consumer categories. Reasonable estimates about the growth rates

of the various consumer categories have been made to arrive at the energy sales

forecast for FY 2021-22. In case the growth trend in recent years is negative, the

Commission has considered 0% growth rate for those consumer categories. The

Commission has considered the same growth rate for Jeevan Dhara and Domestic A

categories, in view of the trend of migration from Jeevan Dhara category to Domestic

A category, due to exceeding the consumption limit.

6.3.7 The growth rate considered for projecting the sales to different categories of

consumers for FY 2021-22 is as shown in the Table below:

Table 76: Growth rates considered for various categories for FY 2021-22

Category

Growth rate

considered Remarks

Jeevan Dhara & Domestic A 0.5 kW to 5 kW 6% 4-year CAGR

Domestic-B above 5 kW to 25 kW 12% 5-year CAGR

Commercial Load above 0.5 to 25 kW 8% 5-year CAGR

General Load up to 25 Kw 4% 4-year CAGR

Public Lighting 3% 4-year CAGR

Agriculture up to 7.5 HP 26% 5-year CAGR

Small Industries Rural up to 25 kW 10% 5-year CAGR

Small Industries Urban 4% 5-year CAGR

Temporary 0% No growth

HT Domestic 25 kW and above 0% No growth

HT Commercial 25 kW above 0% No growth

Public Water Works 5% 4-year CAGR

Bulk Supply Govt. Edu Inst 1% 5-year CAGR

Bulk Supply Others 0% No growth

HT Small Industries up to 50 kW 0% No growth

HT Industries-1 50 kW to 150 kW 4% 5-year CAGR

HT Industries-II above 150 kW 3% 4-year CAGR

Tea Coffee & Rubber 2% 5-year CAGR

Oil & Coal 0% No growth

HT Irrigation Load above 7.5 HP 0% No growth

6.3.8 The category-wise sales approved by the Commission for FY 2021-22 is given in the

Table below:


Table 77: Category-wise Energy Sales approved for FY 2021-22 (MU)

Category MYT Order dtd.

01.03.2019 APDCL

Approved in

this Order

JEEVAN DHARA 869 479 452

DOMESTIC A 3974 3,611 3,407

Domestic-B above 5 kW to 25 kW 407 451 449

Commercial Load above 0.5 to 25 kW 738 887 882



Agriculture up to 7.5 HP 34 49 50


Small Industries Urban 30 37 37

LT Electric Vehicles Charging Stations - - -

Temporary 12 6 6

LT TOTAL 6,256 5,782 5,543

HT Domestic 25 kW and above 31 21 21

HT commercial 25 kW & above 415 393 355




HT Small Industries up to 50 kW 23 19 18

HT Industries-I 50 kW to 150 kW 67 110 101

HT Industries-II above 150 kW 908 931 902

Tea Coffee& Rub 624 466 468

Oil & Coal 76 67 65

HT Irrigation Load above 7.5 HP 15 15 15

HT Temporary - - 2

HT Electric Crematorium 0.5 - -

HT Electric Vehicle Charging Station - - 0.2

HT TOTAL 2,706 2,585 2,494

TOTAL ENERGY SALES 8,962 8,366 8,037

Therefore, the Commission approves total sales of 8037 MU for FY 2021-22.


6.4.1 The Commission had approved distribution loss of 15.00% for FY 2021-22 in the MYT

Order dated March 01, 2019.

6.4.2 APDCL submitted that with the massive increase in LT consumers without adequate

HT backbone, the stipulated distribution loss target of 15.00% will be very difficult to

achieve. The problem has got aggravated with high attrition ratio vis-à-vis pendency of


recruitment process due to some legal complications. However, it is expected that the

recruitment process will attain its finality with the recent developments.

6.4.3 Despite such adverse scenario, the Petitioner is hopeful of somehow reducing the

distribution loss levels and expects to be able to achieve Distribution Loss level of

17.50%. APDCL has requested the Commission to approve Distribution Loss of

17.50% for FY 2021-22.


6.4.4 It is observed from the submission of APDCL that there has been massive increase in

LT Jeevan Dhara and Domestic A consumers due to rural electrification. However, on

the other hand, APDCL is making a huge investment towards system strengthening

and system improvement.

6.4.5 Considering the above facts, at the time of finalizing the MYT Order, the Commission

had approved a loss level of 15.00% for FY 2021-22, which is still above the loss level

agreed under the UDAY MoU.

6.4.6 The Commission deems it fit to consider the Distribution Loss at the MYT Order level

of 15.00% considering the investments being undertaken by APDCL. As identified in

the Truing up for FY 2019-20, there is ample scope for improvement in the operational

efficiency of APDCL to achieve the target loss, as there are several Circles with

Distribution Losses significantly higher than the approved loss levels.

Accordingly, the Distribution Loss is approved as 15.00% for FY 2021-22.

6.5 Energy Balance

6.5.1 Based on the revised estimates of the energy sales, projected Distribution Losses and

approved inter-State and intra-State Transmission Losses, APDCL has projected the

revised estimate of the energy requirement for FY 2021-22.

6.5.2 APDCL has projected the Energy Balance for FY 2021-22 as shown below:

Table 78: Energy Balance for FY 2021-22 as Projected by APDCL (MU)

Particulars MYT Order dtd.

01.03.2019 Projected

Energy Sales 8,962 8,366

Distribution Loss (%) 15.00% 17.50%

Energy Requirement at Distribution Periphery 10,543 10,141

Intra-State (AEGCL) Transmission Loss (%) 3.29% 3.29%

Energy input to Transmission System 10,902 10,486



01.03.2019 Projected

Sale of Surplus Power 254 579

Inter-State (PGCIL) Pooled Loss (%) 1.40% 1.40%

Total Energy Requirement 11,311 11,214


6.5.3 The Commission approves the Energy Balance for FY 2021-22 based on the projected

sales, approved Distribution Loss trajectory, approved Transmission Loss trajectory

for AEGCL, and estimated PGCIL Losses, as shown in the Table below. The sale of

surplus power has been retained at the same level as projected by APDCL.

Table 79: Energy Balance for FY 2021-22 approved by the Commission (MU)

Particulars

MYT Order

dtd.

01.03.2019

APDCL Approved in

this Order

Energy Sales 8,962 8,366 8,037

Distribution Loss (%) 15.00% 17.50% 15.00%

Distribution Loss (MU) 1,582 1,775 1,418

Energy Requirement at Distribution

Periphery T-D

10,543 10,141 9,455

Intra-State Transmission Loss (%) 3.29% 3.29% 3.29%

Intra-State Transmission Loss (MU) 358 345 322

Energy input to Transmission System 10,902 10,486 9,776

Sale of Surplus Power 254 579 579

Inter-State (PGCIL) Pooled Loss (%) 1.40% 1.40% 1.40%

Inter-State (PGCIL) Pooled Loss (MU) 155 149 139

Total Energy Requirement 11,311 11,214 10,494

Therefore, the Commission approves total Power Purchase Requirement of 10,494 MU

for FY 2020-21.

6.6 Power Purchase

6.6.1 APDCL submitted that it is largely dependent on APGCL and Central Generating

Stations to meet the Base Load, however, to meet the Peak demand of the State,

APDCL has tied up with short-term sources like Traders as well as sourced power from


Power Exchanges to meet the deficit.

6.6.2 APDCL submitted that it has projected the source-wise power purchase for FY 2021-

22 based on the following assumptions:

➢ APGCL: APDCL has firm allocation of power from State Generating Stations

of APGCL. Thermal plants of APGCL include NTPS, LTPS and LRPP. Hydro

plants of APGCL supplying power to APDCL are MeHEP and KLHEP. The

gross energy availability from the existing stations based on the allocated

capacity and the actual PLF, Auxiliary consumptions for these plants. The fixed

as well as variable cost for the State Generating Stations has been considered

as per the latest available information.

➢ Central Generating Stations (NER & ER): The share allocation of the various

plants of CGS (NER and ER) has been considered based on the latest REA.

PLF is considered based on past year actuals vis-à-vis shut down of plants.

Kopili-I, Kopili II, and Khandong Stations of NEEPCO have not been considered

due to their faulty machines. Operational norms are considered as determined

by CERC in respective Tariff Orders. Rate of power purchase from the CGS

has been considered as per the latest available information for the respective

plants.

➢ Other sources: For HHPPCL, PLF and auxiliary consumption has been

considered as per the Commission’s Order dated April 12, 2013. The levelised

tariff as determined for this plant in the Tariff Order dated April 12, 2013 of Rs.

4.11/kWh has been considered.

Generation from NVVNL Solar Bundled (JNNSM) and NVVNL Coal Bundled

(JNNSM) for FY 2021-22 has been considered on the basis of latest available

information.

No purchase from OTPC under merchant power route has been considered, in

view of the expiry of the bilateral PPA.

For Suryapratap Solar, normative parameters of the PLF and auxiliary

consumption as approved by the Commission have been considered. The

purchase rate has been considered as Rs. 8.78/kWh as per the Commission’s

order.

For SECI (Solar) JNNSM, energy charge rate has been considered as per the

terms of the PSA.


Power from Nikachchu HEP (Bhutan) is estimated from 22.04.2021 as per

latest available information and cost is estimated as per the terms of the PSA.

For Mangdechchu (Bhutan), the agreement tariff (including trading margin of 7

paisa) has been considered.

➢ Renewable sources: APDCL has projected to meet the RPO by mix of

purchase from REC purchase and RE sources. REC purchase is kept same as

approved level.

➢ Inter-State and Intra-State Transmission Charges: AEGCL Transmission

Charges and SLDC Charges have been considered same as approved in latest

Tariff Order of AEGCL and SLDC, respectively. PGCIL Charges for FY 2021-

22 have been considered at level projected in APR of FY 2020-21.

6.6.3 The source-wise power purchase quantum and cost projected by APDCL for FY 2021-

22 is shown in the Table below:

Table 80: Power Purchase Quantum and Cost submitted by APDCL for FY 2021-22 (Rs.

Crore)

Sl. No.

Agency/Source

MYT Order dtd. 01.03.2019 APDCL Submission

Total Quantum

(MU)

Total Cost

(Rs Cr)

Rate (Rs/ kWh)

Total Quantum

(MU)

Total Cost

(Rs Cr)

Rate (Rs/ kWh)

1 APGCL 2523.31 769.93 3.05 1317.36 406.91 3.09

2 NEEPCO (HYDRO)

KOPILI I 422.79 49.37 1.17

KOPILI II 51.76 7.09 1.37

KHANDONG 111.29 19.40 1.74

RHEP 548.20 97.82 1.78 626.16 137.44 2.19

DHEP 97.97 50.19 5.12 88.75 48.84 5.50

KAMENG HEP 225.41 109.82 4.87 225.41 91.29 4.05

3 NEEPCO (TH)

AGBPP 788.12 322.01 4.09 884.92 331.73 3.75

AGTPP 176.61 87.99 4.98 376.98 154.21 4.09

AGTPP 2 84.05 14.84 1.77

4 NHPC Existing, Lg HEP 216.58 63.65 2.94 143.69 49.39 3.44

NHPC SUBANSIRI HEP 901.93 227.50 2.52

5 NTPC

FARAKKA 229.30 88.62 3.86 239.05 97.91 4.10

KAHELGAON - I 111.51 63.42 5.69 116.06 42.73 3.68

KAHELGAON -II 469.42 161.04 3.43 433.83 151.00 3.48

TALCHER 151.07 38.20 2.53 150.59 53.48 3.55


Sl. No.

Agency/Source

MYT Order dtd. 01.03.2019 APDCL Submission

Total Quantum

(MU)

Total Cost

(Rs Cr)

Rate (Rs/ kWh)

Total Quantum

(MU)

Total Cost

(Rs Cr)

Rate (Rs/ kWh)

NTPC (New) BTPS 1530.58 1057.33 6.91 2620.99 1661.95 6.34

NTPC BTPS III 565.87 391.25 6.91

6 MeECL 2.17 1.71 7.88

7 Pare HEP 128.35 59.92 4.67 210.79 103.74 4.92

8 Suryatap Solar 4.19 3.68 8.78 5.47 5.28 9.65


8.74 10.38 11.88 6.77 9.01 13.31

10 SECI Solar 34.95 24.95 7.14 37.10 23.48 6.33


35.09 10.80 3.08 46.53 21.31 4.58

13 Power Exchanges 657.98 298.04 4.53

14 OTPC 1388.14 517.52 3.73 1343.03 441.52 3.29


16 Wind Power PTC 87.16 30.77 3.53 98.78 35.83 3.63

17 SECI Wind 87.16 23.71 2.72 129.36 35.71 2.76

18 Mangdechhu 631.40 272.33 4.31

19 PTC Nikachu 139.81 58.05 4.15 471.28 195.67 4.15

20 SPV Assam 174.76 58.11 3.33 218.16 72.69 3.33

Sub-total: 11,310.95 4,426.05 3.91 11,086.99 4,744.18 4.28

22 REC (Solar) 25.39 25.39

23 REC (Non-Solar) 18.44 18.44


126.91 47.76 3.76

Sub-total: 11,310.95 4,469.88 3.95 11,213.90 4,835.78 4.31


403.65 403.65



592.24 782.70

TOTAL 11,310.95 5,471.43 4.84 11,213.90 6,028.52 5.38


6.6.4 The Commission has considered the quantum and cost of power purchase from

APGCL in line with the generation and rate approved for APGCL in the Tariff Order of

APGCL dated February 15, 2021 for FY 2021-22.

6.6.5 For all other sources except the following sources, the power purchase quantum and

cost has been taken same as APR of FY 2020-21:

a) The quantum and cost against Kopili-I, Kopili-II, and Khandong is considered as Nil,

because the projects are under shutdown;

b) The quantum of purchase from for Kameng HEP is considered same as proposed


by APDCL, as this is a new project, and the project was not generating for the ful;

year of FY 2020-21; the rate for purchase from Kameng has been considered same

as the actual rate of purchase in FY 2020-21;

c) JNNSM Bundled Solar projection considered same as APDCL proposal;

d) Power purchase quantum and cost for SPV Assam is considered same as APDCL

proposal;

e) No purchase from OTPC under merchant power route has been considered, in view

of the expiry of the bilateral PPA;

f) Cost and quantum from Mangdechhu and PTC Nikachu are considered in line with

the submissions of APDCL, as these are new stations, that were not present in FY

2020-21;

g) Power purchase through Power Exchanges has been considered to meet the

balance energy requirement, at the same rate as estimated for FY 2020-21

h) Solar and Non-Solar REC’s have been considered to meet the shortfall in RE

purchase vis-à-vis the RPO target specified in the RPO Regulations. The

consideration of RECs is only for the purpose of allowing power purchase cost to

the extent of RPO targets. However, APDCL should take all efforts to procure RE

power to the extent of RPO targets, rather than relying on REC purchase, especially

given the lower rates at which new RE power is presently available.

6.6.6 The Intra-State Transmission Charges and SLDC charges have been considered as

per the tariff approved by the Commission for AEGCL and SLDC, respectively, vide

Tariff Order dated February 15, 2021.

6.6.7 The PGCIL charges have been considered same as the estimated charges for FY

2020-21.

6.6.8 The source-wise power purchase quantum and costs approved by the Commission for

FY 2021-22, is shown in the Table below:


Table 81: Power Purchase Quantum and Cost approved for FY 2021-22

Sl. Agency/Source

MYT Order dtd. 01.03.2019 APDCL Approved in ARR

Quantum Total Cost Rate Quantum Total Cost Rate Quantum Total Cost Rate

MU Rs. Crore Rs./ kWh



1 APGCL 2523.31 769.93 3.05 1317.36 406.91 3.09 1458.77 385.21 2.64

2 NEEPCO (HYDRO) KOPILI I 422.79 49.37 1.17

KOPILI II 51.76 7.09 1.37 KHANDONG 111.29 19.40 1.74

RHEP 548.20 97.82 1.78 626.16 137.44 2.19 626.16 135.28 2.16 DHEP 97.97 50.19 5.12 88.75 48.84 5.50 88.75 46.77 5.27

3 NEEPCO (HYDRO) New

KAMENG HEP 225.41 109.82 4.87 225.41 91.29 4.05 225.41 90.18 4.00

4 NEEPCO (TH)

AGBPP 788.12 322.01 4.09 884.92 331.73 3.75 884.92 303.58 3.43 AGTPP 176.61 87.99 4.98 376.98 154.21 4.09 376.98 152.76 4.05

AGTPP 2 84.05 14.84 1.77 225.41 91.29 4.05

7 NHPC Existing, Lg HEP

216.58 63.65 2.94 143.69 49.39 3.44 143.69 49.39 3.44

8 NHPC New SUBANSIRI HEP 901.93 227.50 2.52

9 NTPC (Existing) FARAKKA 229.30 88.62 3.86 239.05 97.91 4.10 239.05 92.01 3.85

KAHELGAON - I 111.51 63.42 5.69 116.06 42.73 3.68 116.06 42.41 3.65 KAHELGAON -II 469.42 161.04 3.43 433.83 151.00 3.48 433.83 146.20 3.37

TALCHER 151.07 38.20 2.53 150.59 53.48 3.55 150.59 36.46 2.42


Sl. Agency/Source






FARAKKA-III

10 NTPC (New) BTPS 1530.58 1057.33 6.91 2620.99 1661.95 6.34 2279.34 1430.61 6.28

NTPC BTPS III 565.87 391.25 6.91

11 Pohmura SHEP

12 MeECL 2.17 1.71 7.88

13 Pare HEP 128.35 59.92 4.67 210.79 103.74 4.92 210.79 105.47 5.00

14 Suryatap Solar 4.19 3.68 8.78 5.47 5.28 9.65 5.47 4.81 8.79

15 IOCL(AOD)


8.74 10.38 11.88 6.77 9.01 13.31 6.77 9.01 13.31

17 SECI Solar 34.95 24.95 7.14 37.10 23.48 6.33 37.10 23.97 6.46


35.09 10.80 3.08 46.53 21.31 4.58 46.53 19.95 4.29


20 Power Exchanges 657.98 298.04 4.53 265.96 86.60 3.26

21 OTPC 1388.14 517.52 3.73 1343.03 441.52 3.29 1343.03 456.17 3.40

22 HHPCPL (Champawati)

14.66 6.98 4.76 6.55 2.69 4.11 5.92 2.41 4.07

23 Wind Power PTC 87.16 30.77 3.53 98.78 35.83 3.63 98.78 40.43 4.09

24 SECI Wind 87.16 23.71 2.72 129.36 35.71 2.76 129.36 37.59 2.91

25 Mangdechhu 631.40 272.33 4.31 631.40 272.33 4.31

26 PTC Nikachu 139.81 58.05 4.15 471.28 195.67 4.15 471.28 195.67 4.15

27 SPV Assam 174.76 58.11 3.33 218.16 72.69 3.33 218.16 72.69 3.33

Sub-total: 11,310.95 4,426.05 3.91 11,086.99 4,744.18 4.28 10,494.10 4,237.96 4.04


Sl. Agency/Source






29 REC (Solar) 25.39 25.39 11.04

30 REC (Non-Solar) 18.44 18.44 16.06

31 UI Pool/DSM 126.91 47.76 3.76 Sub-total: 11,310.95 4,469.88 3.95 11,213.90 4,835.77 4.31 10,494.10 4,265.07 4.06


403.65 403.65 389.09

33 SLDC Charges 6.40 6.40 7.36


592.24 782.70 782.70

TOTAL 11,310.95 5,471.43 4.84 11,213.90 6,028.52 5.38 10,494.10 5,444.22 5.19

Therefore, the Commission approves total Power Purchase Expenses of Rs. 5444.22 Crore for FY 2021-22.

The Average Power Purchase Cost (APPC) for FY 2021-22, applicable for settlement of energy in case of gross/net metering by

Rooftop Solar installations, and settlement of energy charges for REC purchases, shall be Rs. 4.02/kWh.


6.7 Operation and Maintenance (O&M) Expenses

The O&M expenses comprise Employee Expenses, R&M expenses and A&G

expenses.

6.7.1 Employee Expenses

APDCL submitted that the employee expenses have been projected on normative

basis as per MYT Regulations, 2018, based on the following approach:

a) The employee expenses estimated in the APR for FY 2020-21 have been



from FY 2018-19 to FY 2020-21 (up to August 2020), which works out to 5.41%;

c) Growth factor of 3% has been considered to accommodate proposed recruitment

of employees.

The normative employee expenses computed by APDCL for FY 2021-22 is as shown

below:

Table 82: Employee Expenses Projected by APDCL for FY 2021-22 (Rs Crore)


01.03.2019 APDCL

Employee Expenses for Previous Year 891.61 771.83

Growth Factor 1% 3%



Accordingly, APDCL has projected the Employee expenses at Rs.837.99 Crore

for FY 2021-22.

6.7.2 Repair and Maintenance (R&M) Expenses

APDCL submitted that it has proposed R&M expenditure based on the MYT

Regulations, 2018. APDCL has considered the value of ‘K’ as 3.50%, same as

approved in the MYT Order. APDCL has considered WPI of 2.99% (on the basis of

CPI till August 2020). Accordingly, APDCL has projected the R&M Expenses for FY

2021-22, as under:


Table 83: R&M Expenses Projected by APDCL for FY 2021-22 (Rs Crore)


01.03.2019 APDCL

GFA for previous year 5,459.82 7,099.61

Growth Factor 3.50% 3.50%


R & M Expenses 196.84 255.90

Accordingly, APDCL has projected the R&M Expense of Rs. 255.90 Crore for FY

2021-22.

6.7.3 Administrative and General (A&G) Expenses

APDCL submitted that it has proposed A&G expenses based on the MYT Regulations,

2018. APDCL has considered WPI of 2.99% (on the basis of WPI till October 2020).

The provision of Rs 2 Crore is kept same as approved in the MYT Order, while the

Statutory Fees has been considered same as estimated in the APR for FY 2020-21.

Table 84: A&G Expenses Projected by APDCL for FY 2021-22 (Rs. Crore)


01.03.2019 APDCL

A&G Expenses for previous year 52.62 48.15


Provision 2.00 2.00

Statutory fees - 1.61


Accordingly, APDCL has projected the A&G expenses of Rs. 53.19 Crore for FY

2021-22.


6.7.4 The Commission has computed the O&M Expenses for FY 2021-22 on normative basis

as per the MYT Regulations, 2018. Any variation between normative O&M expenses

and actual O&M Expenses shall be considered under sharing of gains and losses on

account of controllable items as per the MYT Regulations, 2018 at the time of truing

up for respective year.

6.7.5 For computation of employee expenses for FY 2021-22, the Commission has adopted



a) The employee expenses computed in the APR of FY 2020-21 have been

considered as base expenses;

b) CPI inflation has been computed as average increase of CPI index for the

period from FY 2017-18 to FY 2019-20, which works out to 5.35%;

c) Growth factor is considered at 0%, in view of the steep decline in the

number of employees..

6.7.6 The normative employee expenses approved for FY 2021-22 is shown in the following

Table:

Table 85: Employee Expenses Approved for FY 2021-22 (Rs. Crore)


01.03.2019 APDCL

Approved in ARR

Employee Expenses for Previous Year

891.61 771.83 772.24


CPI Inflation 3.77% 5.41% 5.35%

Employee Expenses 934.52 837.99 813.58

Therefore, the Commission approves Employee Expenses of Rs. 813.58 Crore,

for FY 2021-22.

6.7.7 For computation of R&M Expenses for FY 2021-22, the Commission has considered


a) Average GFA of previous year has been considered as approved in APR of FY

2020-21;

b) WPI inflation has been computed as average increase of WPI index for period from

FY 2017-18 to FY 2019-20, which works out to 2.96%;

c) K-factor of 3.50% has been considered as approved in the MYT Order.

6.7.8 The normative R&M expenses approved for FY 2021-22 is shown in the following

Table:


Table 86: R&M Expenses Approved for FY 2021-22 (Rs. Crore)


01.03.2019 APDCL

Approved in ARR

Average GFA for previous year 5,459.82 7,099.61 5,844.70

K Factor 3.50% 3.50% 3.50%

WPI Inflation 3.00% 2.99% 2.96%

R&M Expenses 196.84 255.90 210.62

Therefore, the Commission approves R&M Expenses of Rs. 210.62 crore for

FY 2021-22.

6.7.9 For computation of A&G expenses for FY 2021-22, the Commission has adopted the

following approach:

a) The A&G expenses approved in APR of FY 2020-21 have been considered as

base expenses;

b) WPI inflation has been computed as average increase of WPI index for period from

FY 2017-18 to FY 2019-20, which works out to 2.96%

c) As approved in MYT Order, the Commission has considered total provision of Rs.

2 Crore comprising Rs. 1 crore for consumer awareness initiatives and Rs. 1 crore

for capacity building of APDCL employees. As additional provision has been made

for these special initiatives, APDCL shall submit segregated details to the

Commission at the time of true-up;

d) The statutory fees of Rs. 1.61 crore estimated in the APR for FY 2020-21 have

been considered as a separate pass-through item, and added to the normative

A&G expenses computed for FY 2021-22 as above.

6.7.10 The approved A&G expenses for FY 2021-22 are shown in the following Table:

Table 87: A&G Expenses Approved for FY 2021-22 (Rs. Crore)


01.03.2019 APDCL

Approved in ARR

A&G Expenses for Previous Year 52.62 48.15 40.75

WPI Inflation 3.00% 2.99% 2.96%

Provision 2.00 2.00 2.00

Statutory Fees 1.61 1.61

A&G Expenses 56.20 53.19 45.56


Therefore, the Commission approves A&G Expenses of Rs. 45.56 Crore for FY

2021-22.

6.8 Capital Expenditure and Capitalisation

6.8.1 The Commission had approved capital expenditure and capitalization of Rs. 1000

Crore and Rs. 650 Crore, respectively, for FY 2021-22, in the MYT Order dated March

01, 2019.

6.8.2 APDCL submitted that the Capital Expenditure and Capitalisation for FY 2021-22 has

been computed based on the works carried out till date vis-à-vis pending CWIP.

Accordingly, APDCL has projected the capital expenditure and capitalisation for FY

2021-22 as Rs. 503.97 Crore and Rs. 2321.80 Crore, respectively.

6.8.3 APDCL has proposed the financing of the said capitalisation as under:

Table 88: Financing of the Projected Capitalisation for FY 2021-22 (Rs Crore)

Source Amount (Rs. Crore)

Debt 232.18

Equity -

Grant 2089.62

Total 2321.80


6.8.4 APDCL has proposed huge capitalization of Rs.2321.80 Crore as against the approved

capitalization of Rs. 650 Crore.

6.8.5 It is observed that APDCL has been projecting huge capitalization at the time of ARR

and achieving much lower capitalization. The Commission has therefore, considered

capitalization for FY 2021-22 in line with the capitalization estimated in the APR FY

2020-21, which is based on recent past trends and considers the impact of COVID.

6.8.6 The Commission hence, approves the capitalization of Rs.1320.96 Crore for FY 2021-

22. The Commission has considered funding of the Capitalization through Grant and

Debt in the ratio of 90:10, as per typical funding pattern, and as proposed by APDCL

in its Petition. The following Table shows the approved capitalization and its funding

considered for FY 2021-22.


Table 89: Capitalisation and proposed funding approved for FY 2021-22 (Rs Crore)

Source MYT Order dtd.

01.03.2019 APDCL Approved in ARR

Debt 65.00 232.18 132.10

Equity - - -

Grant 585.00 2,089.62 1,188.86

Total

Capitalization 650.00 2,321.80 1,320.96

6.9 Depreciation

6.9.1 The Commission had approved depreciation of Rs. 23.73 Crore for FY 2021-22 in the

MYT Order dated March 01, 2019.

6.9.2 Depreciation on subsequent assets is claimed after apportionment of available grant.

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

as consumer contribution, grant received against such schemes is shown separately

with no claim of depreciation. The total depreciation claimed is Rs. 62.53 Crore after

adjustment of funding from grant of Rs. 94.85 Crore.

6.9.3 Depreciation has been claimed in accordance with the MYT Regulations, 2018, after

apportionment of depreciation for assets created out of consumer contribution. Assets

which have been fully depreciated have been excluded from the asset base for the

purpose of calculating depreciation. Rates of depreciation as notified in the addendum

to MYT Regulations, 2018 have been considered.

6.9.4 The depreciation proposed by APDCL for FY 2021-22 is shown in the Tables below:


Table 90: Depreciation calculation of FY 2021-22 as submitted by APDCL (Rs. Crore)

Particulars

Gross Fixed Assets Depreciation

As on 01.04.2021

Asset Addition

Rate of Dep

Assets fully depreciated

On OB On Addition Total

Land & Rights

i) Land owned under full title

18.9 0.85 - - -

ii) Leasehold land 5.83 16.09 3.34% 0.18 0.24 0.42

Sub total: 24.72 16.94 - 0.18 0.24 0.42

Building 58.08 6 3.34% 7.32 1.53 0.09 1.62

Hydraulic - - - - -

Other Civil Works 60.56 10.46 3.34% 5.91 1.64 0.16 1.8

Plant & Machinery 807.46 452.22 5.28% 213.74 28.21 10.74 38.96

Lines & Cable Network 1,651.18 1,802.93 5.28% 442.45 57.44 42.84 100.28

Vehicles 27.75 2.7 5.28% 11.34 0.78 0.06 0.84

Furniture & Fixtures 18.86 3.44 6.33% 9.98 0.51 0.1 0.6

Office Equipment 40.61 26.97 6.33% 23.57 0.97 0.77 1.74

SUB TOTAL 2,689.23 2,321.66 5.44% 714.31 91.25 55 146.25

Add: Consumers contribution

233.94 0.13 5.28% 11.12 0 11.12

Add: Assets not belonging to the entity

5,497.39 - - -

Total 8,420.56 2,321.79 714.31 102.37 55 157.37


Table 91: Depreciation claimed by APDCL for FY 2021-22 (Rs. Crore)

Particulars State Govt. grant

Grant for

assets not

belonging to entity

(RGGVY, MNRE

etc.)

Consumer

Contribution Total

As on 01.04.2005 As on 01.04.2021 Sub total As on 01.04.2021


GFA (excluding Consumer

Contribution and assets not

belonging to company)

765.43 1,923.80 2,689.23

5,497.39

233.94 8,420.56

CWIP 330.20 3,252.45 3,582.65 2,211.33 5,793.98

Total 1,095.63 5,176.26 6,271.89 7,708.72 233.94 14,214.54

Cumulative grants apportioned

in the ratio of GFA and CWIP

GFA - 1,743.96 1,743.96 4,458.51 233.94 6,436.40

CWIP - 2,948.39 2,948.39 1,793.44 4,741.83

Total - 4,692.35 4,692.35 6,251.95 233.94 11,178.23

Depreciation calculated as per

the Regulation on the GFA

41.63 104.63 146.25 -

11.12 157.37

Weighted Average Rate of

Depreciation (%)

5.44% 5.44% 5.44% -

4.75% 1.87%

Depreciation to be deducted

on the assets built on the

grants component value

- 94.85 94.85

-

94.85


After adjustment of grant component, APDCL has claimed Depreciation of Rs 62.53 Crore for FY 2021-22.



6.9.5 For computation of depreciation, the Commission has considered the closing GFA for

FY 2020-21 as approved in the APR for FY 2020-21, as the Opening GFA for FY 2021-

22. The Capitalisation approved in the above section of this Order has been considered

as asset addition during FY 2021-22. The Commission has considered the scheduled

depreciation rates as specified in MYT Regulations, 2018.

6.9.6 As per the Regulation 32 of the MYT Regulations, 2018, the total depreciation during

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

has computed the depreciation separately for assets added under each asset head in

each 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.

6.9.7 The Commission has not considered depreciation on assets funded through grants in

accordance with Regulation 32 of the MYT Regulations, 2018.

6.9.8 In view of the above, the Commission has approved depreciation for FY 2021-22

as per MYT Regulations, 2018, as given in the Table below:

Table 92: Depreciation approved for FY 2021-22 (Rs. Crore)

SL Particulars Opening

GFA

Addition

during the

year

Rate of

depreciation

Depreciation

Approved

1 Land & Rights 19.09 0.34 0.00% -

2 Leasehold Land 2.84 - 3.34% 0.09

3 Building 59.33 2.37 3.34% 2.02

4 Plant & Machinery 735.89 12.27 5.28% 27.86

5 Vehicle 27.24 - 5.28% 1.46



8 Other Civil Work 62.76 4.14 3.34% 2.17


10 Total 2,390.88 132.10 93.19




14 Less: Depreciation for Grants 76.54



Therefore, the Commission approves Depreciation of Rs. 16.65 Crore for FY 2021-22.

6.10 Interest & Finance Charges

6.10.1 APDCL submitted that it has projected interest on loan capital based on the existing

source-wise loans outstanding, repayment schedule and prevailing interest rates.

Presently, APDCL has loans from Government of Assam and PFC. In order to reduce

the interest burden and to achieve financial turnaround, APDCL has joined UDAY

scheme, which has materialized in FY 2020-21.

6.10.2 APDCL has claimed interest and finance charges in line with the approach followed in

Tariff Orders. APDCL has projected 5% increase in Bank Charges, and 15% increase

in Billdesk Charges over FY 2020-21 estimates, considering that more consumers are

availing digital payment platforms.

6.10.3 Accordingly, APDCL has projected Interest Expenses for FY 2021-22 as shown in the

Table below:

Table 93: Interest on Loan Capital as submitted by APDCL (Rs. Crore)


01.03.2019 APDCL

Interest on Loan capital 15.29 123.62

Bank Charges - 2.95

Billdesk Charges for Collecting Revenue - 3.34

Total 15.29 129.91

Accordingly, APDCL projected Interest Expenses of Rs. 129.91 Crore for FY 2021-22.


6.10.4 The Commission notes that Interest on loan capital for FY 2021-22 is required to be

allowed on normative basis as per Regulation 34 of MYT Regulations, 2018.

6.10.5 For computation of Interest on Loan, the Commission has considered the closing loan

balance of FY 2020-21, as approved in the APR of FY 2020-21, as the opening balance

for FY 2021-22. The addition to loan has been considered based on the funding of

capitalisation in FY 2021-22, as elaborated earlier. The Loan repayment is considered

equal to the Depreciation allowed for FY 2021-22. The Commission has considered

interest rate of 10.00% for computing normative interest for FY 2021-22, in accordance

with the terms of UDAY MoU.


6.10.6 The Commission has considered 5% increase in Bank Charges and Billdesk Charges

over FY 2020-21 estimates.

6.10.7 Accordingly, the Interest Expenses approved by the Commission for FY 2021-22 is

shown in the following Table:

Table 94: Approved Interest Expenses for FY 2021-22 (Rs. Crore)


01.03.2019 APDCL

Approved

in ARR


Addition of normative loan during the

year

65.00 232.18 132.10



Interest Rate 9.40% 10.74% 10.00%


Interest & Financing Charges 2.95 2.95

Billdesk Charges for collecting Revenue 3.33 2.78

Total Interest & Financing Charges 15.29 129.91 24.31

Therefore, the Commission approves Interest Expenses of Rs. 24.31 Crore for

FY 2021-22.


6.11.1 APDCL submitted that it has computed the IoWC as per MYT Regulations, 2018, as


Table 95: Interest on Working Capital submitted by APDCL (Rs Crore)


01.03.2019 APDCL

O&M Expenses-One month 98.96 95.59

2-month Receivables 178.13 969.35

Maintenance spares @ 15% of O&M Expenses 1030.25 172.06

Less: One-month Power Purchase Cost 455.95 477.54

Less: Consumer Security Deposit 830.96 759.96

Total Working Capital 20.43 (0.50)

Rate of Interest on Working Capital 11.50% 10.00%

Interest on Working Capital 2.35 0.00


As the normative working capital requirement works out to be zero, no IoWC has been claimed

by APDCL.


6.11.2 The Commission has computed IoWC in accordance with Regulation 36 of the MYT

Regulations, 2018. The rate of Interest has been considered equal to SBI MCLR Rate

(one-year tenor) prevailing for last available 6 months plus 300 basis points, i.e.,

10.00%. In line with the approach adopted in true-up for FY 2019-20 and APR for FY

2020-21, the Commission has excluded the power purchase cost towards purchase

through Power Exchanges, while computing the normative working capital

requirement.

6.11.3 The IoWC approved by the Commission for FY 2021-22 is shown in the Table below:

Table 96: IoWC approved by the Commission for FY 2021-22 (Rs. Crore)


dtd.

01.03.2019

APDCL Approved

O&M Expenses for One Month 98.96 95.59 89.15

Maintenance spares @ 15% of O&M

Expenses 178.13 172.06 160.46

Two months equivalent of expected

revenue from sale of electricity 1030.25 969.35 1011.50

Less: 1 month of Power Purchase Cost 455.95 477.54 446.47

Less: Amount held as Consumer Security

Deposit 830.96 759.96 763.51

Total Working Capital Required 20.43 (0.50) 51.13

Interest rate 11.50% 10.00% 10.00%

Interest on Working Capital 2.35 - 5.11

Therefore, the Commission approves IoWC of Rs. 5.11 Crore for FY 2021-22.

6.12 Interest on Consumers’ Security Deposit

6.12.1 APDCL submitted that with successful roll out of software facilitating automatic

adjustment of interest on security deposit in energy bills, the liquidation of liability on

such account has significantly increased.


6.12.2 Considering the improving trend of liquidation of interest on security deposit, APDCL

has projected interest on CSD as Rs. 38.06 Crore, based on the actuals for FY 2019-

20.


6.12.3 The Commission has considered the submission of APDCL, and therefore, approves

interest on CSD of Rs. 38.06 Crore in the ARR of FY 2021-22.

6.13 Provision for Bad & Doubtful Debts

6.13.1 APDCL has requested to allow the Provision for Bad & Doubtful Debts equal to the

actual Provision for FY 2019-20, at Rs. 22.10 Crore, for FY 2021-22.


6.13.2 The Commission has considered the Provision for Bad & Doubtful Debts for FY 2021-

22 as approved in the APR of FY 2020-21. Accordingly, the Commission allows the

Provision for Bad & Doubtful Debts for FY 2021-22 as Rs. 22.10 Crore.


6.14.1 APDCL submitted that with conversion of loan and grants to equity in FY 2020-21,

equity capital at the beginning of FY 2021-22 is expected to be Rs. 1795.83 Crore.

Accordingly, the RoE @16.00% on Rs.1795.83 Crore has been claimed against

approved RoE of Rs. 26.04 Crore for FY 2021-22.


6.14.2 The Commission has approved the RoE in accordance with Regulation 33 of the MYT

Regulations, 2018. The closing equity approved in the APR for FY 2020-21 has been

considered as the opening equity of FY 2021-22. The Commission has considered the

addition of equity as Nil during FY 2021-22, based on the funding of capitalisation

approved in this Order. Therefore, the approved RoE for FY 2021-22 at 16% is shown

in the Table below:


Table 97: Return on Equity approved by the Commission (Rs. Crore)

Therefore, the Commission approves RoE of Rs.75.91 Crore for FY 2021-22.

The additional ROE allowed in this Order, on account of conversion of Grant to

equity, as elaborated in the APR of FY 2020-21, may be considered for transfer

to the Pension Fund. In this regard, the minutes of meeting of PIB circulated vide

letter no P.E/77/2015/234 dated 25th September, 2018 may be referred.


6.15.1 APDCL submitted that it has projected Non-Tariff Income (NTI) considering escalation

of 5% over the Non-Tariff Income estimated for FY 2020-21, except for STOA Credit

on PoC bill, income from reactive power as well as SCED, considering the uncertain

nature of this income.

6.15.2 The following Table shows the Non-Tariff Income projected by APDCL for FY 2021-

22:

Table 98: Non-Tariff Income Projected by APDCL (Rs. Crore)


01.03.2019 APDCL

Meter Rent 25.88 24.33


energy/malpractices 0.90 0.42

Cross Subsidy surcharge on Open Access

Consumer 30.29 37.25

Wheeling Charges collected 4.76 4.78

Short-term Open Access Credit 60.06

Rebate on PP bills 26.75

Miscellaneous Recoveries 26.28 23.63


Sr.

No. Particulars

MYT Order dtd.

01.03.2019 APDCL Approved

1 Opening Equity Capital 162.77 1795.77 474.41

2 Equity addition during the year - - -

3 Closing Equity 162.77 1,795.77 474.41

5 Rate of Return on equity 16.00% 16.00% 16.00%

6 Return on Equity 26.04 287.32 75.91



01.03.2019 APDCL

a) Delayed payment charges 195.35 226.97

b) Income on Reactive Power 0.21

c) Income from SCED 5.36

Grand Total 283.46 409.76

Accordingly, APDCL projected NTI of Rs. 409.76 Crore for FY 2021-22.


6.15.3 The Commission has considered a 5% increase in most of the sub-heads of NTI, as

submitted by APDCL, for projecting Non-Tariff Income for FY 2021-22. In line with the

approach elaborated in the true-up for FY 2019-20 and APR for FY 2021-22, the

Rebate earned by APDCL due to prompt payment of power purchase has not been

considered as NTI. The following Table shows the Non-Tariff Income approved by the

Commission for FY 2021-22:

Table 99: Non-Tariff Income approved by the Commission for FY 2021-22 (Rs. Crore)


01.03.2019 APDCL

Approved

Meter Rent 25.88 24.33 24.33


energy/malpractices

0.90 0.42 0.42

Cross Subsidy surcharge on Open Access

Consumer

30.29 37.25 37.25

Wheeling Charges collected 4.76 4.77 4.77

Short-term Open Access Credit 60.06 60.06

Rebate on PP bills 26.75 -

Miscellaneous Recoveries 26.28 23.64 23.64

Other Miscellaneous and General Charges -

a) Delayed payment charges 195.35 226.97 239.57



Grand Total 283.46 409.76 395.62


Therefore, the Commission approves Non-Tariff Income as Rs. 395.62 Crore for

FY 2021-22.

6.16 Other Income

6.16.1 APDCL submitted that all heads of ‘Other Income’ are estimated on the basis of actuals

for FY 2019-20 (True up) except for the following:

• Miscellaneous receipt is escalated by 5%.

• Revenue from Sale of Surplus Power is based on surplus energy estimate for

FY 2021-22 at IEX price of Rs. 2.35 per unit (off-peak/night hours)

• With high attrition ratio, receipt from pension trust is considered with 3%

decline.

6.16.2 Accordingly, Other Income projected by APDCL for FY 2021-22 is shown in the Table

below:

Table 100: Other Income as submitted by APDCL (Rs. Crore)


01.03.2019 APDCL

Interest on fixed deposits - 94.09

Income from Trading - 135.97

Income from Sale of Scrap - 0.23

Revenue from sale of LED's, Tubelight, Fan, etc. - 0.92

Rent from residential buildings - 0.02

Receipt from Pension Trust - 63.14

Miscellaneous receipts - 47.04

Total 291.61 341.40


6.16.3 The Commission has considered annual increase of 5% over the Other Income

approved in APR of FY 2020-21.

6.16.4 In case of Revenue from Sale of Surplus Power, the Commission has considered the

same on the basis of surplus energy arrived from the Energy Balance approved by the

Commission in this Order for FY 2021-22. The rate of Rs. 2.52 per kWh, which is the

actual rate achieved from surplus sale of power during FY 2019-20, has been

considered on the surplus energy available for sale.

6.16.5 The following Table shows the Other Income considered by the Commission for FY


2021-22:

Table 101: Other Income as approved by the Commission for FY 2021-22 (Rs. Crore)

Particulars

MYT

Order dtd.

01.03.2019

APDCL Approved in

ARR

Interest on fixed deposits - 94.09 94.09

Income from Trading 135.97 148.23


Revenue from sale of LED's, Tubelight,

Fan, etc. 0.92 0.11

Rent from residential buildings 0.02 0.02

Receipt from Pension Trust 63.14 67.10

Miscellaneous receipts 47.04 47.04

Total 291.61 341.40 356.82

Accordingly, the Commission approves Rs. 356.82 Crore as Other Income for FY

2021-22.

6.17 Revenue from sale of Power at Existing Tariff

6.17.1 APDCL has submitted that the Revenue from sale of electricity at existing tariff has

been computed based on the approved tariff as per MYT Order dated 07.03.2020 and

the category-wise sales projected by APDCL for FY 2021-22.

6.17.2 APDCL has considered full cost tariff, without considering any targeted subsidy, for the

purposes of estimating the revenue from sale of electricity at existing tariff. APDCL has

projected the revenue from existing tariff for FY 2021-22 as Rs. 6157.48 Crore.


6.17.3 The Commission has estimated the Revenue from sale of electricity at existing tariff

based on the approved tariff for FY 2020-21 and the approved category-wise sales for

FY 2021-22. The Revenue from Sale of Electricity from existing tariff for FY 2021-

22 as computed by the Commission works out to Rs. 5,792.64 crore.

6.18 ARR for FY 2021-22

6.18.1 Based on the component-wise approval of various expenses heads and revenue

heads, the summary of ARR as submitted by APDCL and as approved by the


Commission for FY 2021-22, is given in the Table below:

Table 102: ARR of APDCL for FY 2021-22 as approved by the Commission (Rs. Crore)

Sl.

No.


01.03.2019 APDCL Approved

1 Power Purchase Expenses 5,471.43 6,028.52 5,444.22

2 O&M Expenses 1,187.56 1,147.09 1,069.76


b) R&M Expenses 196.84 255.90 210.62

c) A&G Expenses 56.20 53.19 45.56

3 Depreciation 23.73 62.53 16.65


5 Interest on Working Capital 2.35 - 5.11

6 Interest on CSD 17.79 38.06 38.06

7 Return on Equity 26.04 287.33 75.91

8 Provisioning for Bad & Doubtful Debts 12.35 22.10 22.10





Accordingly, the Commission approves the ARR of Rs. 5943.69 Crore for FY

2021-22.


7 Cumulative Revenue Gap till FY 2021-22 and Tariff

for FY 2021-22

7.1 Cumulative Revenue Gap

7.1.1 APDCL submitted the total Revenue Gap of Rs. 250.14 Crore for FY 2019-20 including

carrying cost till FY 2021-22. The Cumulative Revenue Gap projected by APDCL for

FY 2021-22 is given in the Table below:

Table 103: Cumulative Revenue Gap till FY 2021-22 as submitted by APDCL (Rs. Crore)

Particulars Rate of

Interest Amount

Revenue Gap after true-up for FY 2019-20 205.57

Carrying/(Holding) cost for FY 2019-20 (half Year) 11.54% 11.86

Carrying/(Holding) cost for FY 2020-21 (full Year) 10.91% 22.42

Carrying/(Holding) cost for FY 2021-22 (half Year) 10.00% 10.28

Total carrying cost 44.57

Total Revenue Gap for FY 2019-20 250.14

Revenue Gap for FY 2021-22 1159.33*

Cumulative Revenue Gap for FY 2021-22 1409.47

Note: * Revised by APDCL to Rs. 806.92 Crore vide reply dated 05.01.2021; revised

Cumulative Revenue Gap works out to Rs. 1057.06

7.1.2 APDCL submitted that the Cumulative Revenue Gap/(Surplus) to be adjusted in the

tariff for FY 2021-22 works out to Rs.1409.47 Crore.

7.1.3 APDCL submitted the ARR for FY 2021-22 as Rs.7214.54 Crore, as shown in the

Table below:

Table 104: ARR for FY 2021-22 as submitted by APDCL (Rs. Crore)

Particulars Amount

A. Standalone ARR for FY 2021-22 6964.40

B. Truing Up for FY 2019-20

a) Principal Amount of Revenue Gap 205.57

b) Carrying cost on the Revenue Gap 44.57


Grand total (A+B) 7214.54


7.1.4 APDCL submitted that revenue from existing tariff for FY 2021-22 is assessed at Rs.

6157.48 Crore.

7.1.5 APDCL submitted that the Average Cost of Supply (ACoS) to recover the entire ARR

of Rs. 7214.54 Crore on projected retail sales of 8366.14 MU during FY 2021-22, will

be Rs. 8.62/kWh. APDCL submitted that recovery of entire amount of Rs. 7214.54

Crore in FY 2021-22 will lead to average increase in existing retail tariff by 10% over

the approved ACoS of Rs. 7.87/kWh for FY 2020-21 (without Government subsidy). At

the same time, delayed recovery of dues will have adverse effect on APDCL’s ability

to discharge its obligations.

7.1.6 APDCL submitted that it has received Rs. 69.99 Crore as rebate from CPSU Gencos

pursuant to Ministry of Power, Govt. of India’s advisory during May, 2020 to provide

some respite to the Discom’s retail consumers on account of COVID-19 pandemic.

Further, with enhancement of equity pursuant to conversion of loan/grant with

enhanced Authorised share capital vis-à-vis massive asset addition, the RoE for FY

2021-22 is estimated at Rs. 287.33 Crore against prevailing Rs. 26.04 Crore.

7.1.7 APDCL submitted that being sensitive to its valued consumers and the global crisis

faced by every segment of consumers, APDCL is proposing to recover only Rs.

6883.26 Crore by passing the benefit of Rebate from CPSU Gencos for COVID during

FY 2020-21 and keeping the claim on additional RoE in abeyance for truing up as


Table 105: ARR for FY 2021-22 as submitted by APDCL (Rs. Crore)

Particulars Amount

a. Standalone ARR for FY 2021-22 6964.40

a1. Additional RoE on enhanced equity 261.29

A. Net Amount without Additional RoE (a – a1) 6703.11

B. Truing Up for FY 2019-20

a) Principal Amount of Revenue Gap 205.57

b) Carrying cost on the Revenue Gap 44.57


C. Rebate from CPSU Gencos for COVID during FY 2020-21 69.99

Grand total (A+B-C) 6883.26

7.1.8 APDCL craved leave to consider passing of Rebate from CPSU Gencos for COVID


during FY 2020-21 and actual RoE for FY 2021-22 at the time of Truing Up for

respective years.

7.1.9 APDCL submitted that recovery of the reduced amount of Rs. 6883.26 Crore will lead

to only 5% average increase over approved ACoS.


7.1.10 The Commission has approved the Revenue Gap of Rs. 186.09 Crore after Truing-up

of FY 2019-20, as against Rs. 205.57 Crore submitted by APDCL.

7.1.11 The Commission has also considered the Revenue Gap/(Surplus)approved for

APGCL and AEGCL in their respective True-up Order for FY 2019-20, along with

carrying cost, by directly passing through the same in the Cumulative Revenue

Gap/(Surplus) of APDCL till FY 2021-22.

7.1.12 The Cumulative Revenue Gap/(Surplus) approved by the Commission till FY 2021-22,

is shown in the Table below:

Table 106: Cumulative Revenue Gap/(Surplus) till FY 2021-22 as approved by the

Commission (Rs. Crore)

Sr.

No. Particulars

Rate of

Interest (%) Amount

1

Revenue Gap/(Surplus) after Truing up of FY 2019-20 186.09

Carrying Cost for FY 2019-20 (Half Year) 11.14% 10.37

Carrying Cost for FY 2020-21 (Full Year) 10.00% 18.61

Carrying Cost for FY 2021-22 (Half Year) 10.00% 9.30

Total Revenue Gap/(Surplus) for FY 2019-20 (A) 224.37

2 Revenue Requirement for FY 2021-22 (B) 5,943.69

3 Impact of True-up of FY 2019-20 for APGCL along

with holding cost (C) (63.26)

4 Impact of True-up of FY 2019-20 for AEGCL along

with holding cost (D) (36.87)

5 Impact of True-up of FY 2019-20 for SLDC along with

holding cost (E) 1.07

7 Cumulative Revenue Requirement for FY 2021-22 (F)

= (A + B + C + D + E) 6,068.99

8 Revenue from Existing Tariff in FY 2021-22 (G)* 6,192.64

9 Cumulative Revenue Gap/(Surplus) till FY 2021-22

(H) = (F) – (G) (123.65)

Note: * Including Rs. 400 Crore of GoA Subsidy against power purchase


7.1.13 Thus, the Cumulative Revenue Surplus after passing through all the past Revenue

Gaps/(Surplus) after truing up for FY 2019-20 for APGCL, AEGCL and APDCL along

with carrying cost works out to Rs. 123.65 crore, which translates to an average tariff

reduction of 2% or ~15.0 paise/kWh for all categories, as a whole.

7.1.14 Accordingly, the Commission has rationalised the category-wise tariffs in order to

adjust the Revenue Surplus of Rs. 123.65 Crore as well as further reduce the cross-

subsidy between consumer categories, as elaborated in subsequent sections of this

Order.

7.2 Tariff Philosophy and Design for FY 2021-22

7.2.1 APDCL submitted that it has been guided by the provisions of the EA 2003, National

Electricity Policy (NEP), Tariff Policy and the MYT Regulations, 2018, while proposing

retail supply tariff for FY 2021-22.

7.2.2 APDCL submitted that it has tried to rationalise the tariff as well as further reduce the

cross-subsidy between the consumer categories while proposing tariffs for the various

consumer categories for FY 2021-22.

7.2.3 APDCL has worked out the ACoS for FY 2021-22 as Rs. 8.23/kWh based on the

proposed ARR and sales, as shown in the Table below. APDCL stated that 88% of the

cost is contributed by Power Purchase cost.

Table 107: ACoS Projected by APDCL for FY 2021-22

Sr. No.

Particulars Units Amount

1 Proposed ARR for FY 2021-22 Rs. Crore 6,883.26

2 Projected Sales for FY 2021-22 MU 8,366.14

3 Average Cost of Supply (ACoS) Rs/kWh 8.23

7.2.4 APDCL submitted that historically the consumer profile of Assam is heavily loaded with

Domestic consumers, which got further aggravated with successful implementation of

SAUBHAGYA. Such adverse consumer mix has already resulted in significantly higher

tariff for a microscopic group of industrial/ commercial consumers, which is creating

hurdle in industrialization in the State of Assam.

7.2.5 APDCL submitted that Govt. of Assam is providing targeted subsidies for a few

categories. In the absence of any written commitment from Govt. of Assam for

continuance of the same in FY 2021-22, APDCL has proposed full-cost recovery tariff


for FY 2021-22. In the event that the Govt. of Assam continues with the category-wise

tariff subsidy for FY 2021-22, the same would be adjusted in the retail tariffs being

charged to the respective consumer categories.


7.2.6 In determining the ARR and the retail supply tariff of APDCL for

FY 2021-22, the Commission has been guided by the provisions of the EA 2003,

National Electricity Policy (NEP), Tariff Policy, and the MYT Regulations, 2018.

7.2.7 Section 61 of the EA 2003 lays down the broad principles and guidelines for

determination of retail supply tariffs. The basic principle is to ensure that tariff should

progressively reflect the cost of supply of electricity and gradually reduce the cross-

subsidies between categories. The EA 2003 lays down special emphasis on

safeguarding of consumers’ interest and also requires that the costs should be

recovered in a reasonable manner. The EA 2003 mandates that tariff determination

should be guided by factors which “encourage competition, efficiency, economical

uses of resources, good performance and optimum investment”.

7.2.8 The EA 2003 provides that while determining the tariff, the Commission shall not show

undue preference to any consumer of electricity but may differentiate according to the

consumer's load factor, power factor, voltage, total consumption of electricity during

any specified period or the time at which the supply is required or the geographical

position of any area, the nature of supply and the purpose for which the supply is

required. The Tariff Policy notified by the Government of India provides comprehensive

guidelines for determination of tariff and determination of ARR of power utilities. The

Commission has followed these Guidelines, as far as possible.

7.2.9 The Commission has carried forward the process of tariff rationalization in this Order

to ensure that the tariffs of most of the categories are within +20% of the ACoS, while

at the same time ensuring that no category is faced with a tariff shock. The tariff of all

subsidising categories has been retained below +120% of ACoS.

7.2.10 The Commission has computed the ACoS of Rs. 7.55/kWh based on the ARR

approved for recovery in FY 2021-22. The ACoS approved by the Commission for FY

2021-22 after inclusion of Revenue Gap of FY 2019-20 along with carrying cost and

after adjustment of Revenue Surplus of APGCL and AEGCL works out to Rs.


7.55/kWh, as shown in the Table below:

Table 108: ACoS approved by the Commission for FY 2021-22

Sr. No.


1 Cumulative Revenue Requirement for FY 2021-22

Rs. Crore 6,068.99

2 Total Sales for FY 2021-22 MU 8.037

3 Average Cost of Supply (ACoS) Rs/kWh 7.55

7.2.11 The Commission has retained the tariff categories and tariff slabs as approved in

previous Tariff Order dated March 7, 2020.

7.2.12 The detailed applicability and description of tariff categories has been elaborated in

the Tariff Schedule under Chapter 10 of this Order.

7.2.13 The benefit of the Cumulative Revenue Surplus has been passed on to the consumers

by reducing the energy charges by 15 to 20 paise per unit across all categories. The

Fixed/Demand Charges have not been reduced, as the recovery of fixed cost through

Fixed/Demand Charges is already on the lower side.

7.2.14 There is an overall decrease of 2.1% (~15 paise/unit) as compared to the existing tariff.

The cross-subsidy in tariff between consumer categories has been reduced further.

7.2.15 The applicability of Time-of-Day (ToD) tariff has been extended to LT Small Industries

and HT Small Industries, on an optional basis, in order to increase the coverage of

ToD tariffs and incentivise small industries. The night off-Peak rebate has been

retained at Rs. 2.00 per kWh, while the additional charges during peak hours have

been increased from Rs. 1.50 per kWh to Rs. 2.00 per kWh, in order to further

incentivise eligible consumer categories to shift more of their consumption from peak

hours to night off-peak hours.

7.2.16 At present, in FY 2020-21, GoA is providing targeted subsidies for a few categories. In

the absence of any written commitment from GoA for providing category-wise subsidy

in FY 2021-22, the Commission has approved the full cost tariff for FY 2021-22, as



Table 109: Full Cost Tariff approved by the Commission for FY 2021-22

Sl. No.

Consumer Category

Increase/(Decrease) in tariffs

Revised tariffs

Fixed Charges

(Rs/kW/mth or

Rs/kVA/mth)

Energy Charges

(paise per kWh)

Fixed Charges

(Rs/kW/mth or

Rs/kVA/mth)

Energy Charges

(paise per kWh)

LT Category

LT-1 Jeevan Dhara 0.5 kW and 1 kWh/day

No Change No Change 20 425

LT-II Domestic A- above 0.5 kW to 5 kW

0 to 120 units per month

No Change (20) 50 490

121 to 240 units per month

No Change (20) 50 615

Balance units No Change (20) 50 715

LT-III Domestic-B above 5 kW to 25 kW

No Change (20) 50 675

LT-IV Commercial Load above 0.5 kW to 25 kW

No Change (20) 130 720

LT-V General Purpose Supply

A Non-commercial and Non-domestic users

No Change (15) 145 615

B

Government Primary and Secondary / Higher Secondary Schools

No Change (15) 70 615

LT-VI Public Lighting No Change (15) 120 625

LT-VII

Agriculture upto 7.5 HP

No Change (15) 45 430

LT-VIII(i)

Small Industries Rural upto 25 kW

No Change (15) 50 475

LT-VIII(ii)

Small Industries Urban upto 25 kW

No Change (15) 60 500

LT-IX Temporary Supply

Domestic No Change (15) 85 909

Non-Domestic Non- Agriculture

No Change (15) 135 1119

Agriculture No Change (15) 45 435

LT-X LT Electric Vehicles Charging Stations

No Change (15) 130 510

HT Category

HT-I HT Domestic 25 kW No Change (15) 50 680


Sl. No.

Consumer Category

Increase/(Decrease) in tariffs

Revised tariffs

Fixed Charges

(Rs/kW/mth or

Rs/kVA/mth)

Energy Charges

(paise per kWh)

Fixed Charges

(Rs/kW/mth or

Rs/kVA/mth)

Energy Charges

(paise per kWh)

and above

HT-II HT Commercial 25 kW & above

No Change (15) 180 710

HT-III Public Water Works

No Change (15) 135 605

HT-IV Bulk Supply 25 kW and above

HT-IV(i)

Educational Institutions

No Change (15) 130 645

HT-IV(ii)

Others No Change (15) 180 720

HT-V(A)

HT Small Industries upto 50 kVA

No Change (15) 70 545

HT-V(B)

HT Industries-1 50 kVA to 150 kVA

No Change (15) 160 585

HT-V(C)

HT Industries-II above 150 kVA (Option 1)

No Change (15) 220 635

HT Industries-II above 150 kVA (Option 2)

No Change (15) 300 595

HT-VI Tea, Coffee & Rubber

No Change (15) 270 635

HT-VII

Oil & Coal No Change (15) 300 740

HT-VIII

HT Irrigation Load above 7.5 HP

No Change (15) 65 580

HT - IX

HT Temporary Supply

No Change (15) 170 885

HT – X

HT Electric Crematorium

No Change (15) 170 415

HT – XI

HT Railway Traction

No Change (15) 300 595

HT-XII

Electric Vehicles Charging Station

No Change (15) 160 660

Note: These are Base Tariffs; Additional ToD tariffs have been detailed in the Tariff Schedule

7.2.17 In case the GoA desires to provide category-wise subsidy in FY 2020-21 under Section

65 of the EA 2003, after the issue of this Order, the GoA may do so under intimation

to the Commission. APDCL shall levy category-wise tariffs after adjusting the amount

of category-wise subsidy announced by the GoA, under intimation to the Commission


along with the complete calculations in this regard. APDCL shall obtain post-facto

approval of the Commission for the category-wise tariff after giving effect to the

targeted subsidy, as applicable.

The detailed Tariff Schedule is given in Chapter 10.

7.3 Category-wise Cross-subsidy

7.3.1 The Commission has computed the cross-subsidy with respect to the ACoS and

attempted to ensure that the cross-subsidies are within the limits of +20% of the ACoS,

as laid down in the Tariff Policy as well as several Judgments of Hon’ble APTEL. The

category-wise cross-subsidy approved for FY 2021-22 by the Commission in this Order

are given in the Table below:

Table 110: Category-wise Cross-Subsidy approved for FY 2021-22

Sr.

No.

Category of

consumers

Average

Billing

Rate

(Paise/

kWh)

Average

Cost of

Supply

(Paise/

kWh)

Ratio of

ABR to

ACOS (%)

Cross-subsidy

provided

/(received) (%)

LT Category

1. Jeevan Dhara 0.5 kW

and 1kWh/day 4.85 7.55 64% - (36%)

2. Domestic A- above 0.5

kW to 5 kW 5.98 7.55 79% - (21%)

3. Domestic-B above 5

kW to 25 kW 8.20 7.55 109% +(9%)

4. Commercial Load

above 0.5 kW to 25 kW 9.05 7.55 120% +(20%)

5. General Purpose

Supply 7.82 7.55 104% +(4%)

6. Public Lighting 7.05 7.55 93% -(7%)

7. Agriculture upto 7.5 HP 5.05 7.55 67% - (33%)

8. Small Industries Rural

upto 25 kW 6.04 7.55 80% - (20%)

9. Small Industries Urban 6.47 7.55 86% - (14%)

HT Category

11. HT Domestic 25 kW

and above 7.42 7.55 98% - (2%)


Sr.

No.

Category of

consumers

Average

Billing

Rate

(Paise/

kWh)

Average

Cost of

Supply

(Paise/

kWh)

Ratio of

ABR to

ACOS (%)

Cross-subsidy

provided

/(received) (%)

12. HT commercial 25 kW

& above 8.83 7.55 117% +(17%)

13. Public Water Works 6.88 7.55 91% - (9%)

14 Bulk Supply -

Educational Institutions 7.35 7.55 97% - (3%)

15 Bulk Supply Others 8.54 7.55 113% +(13%)

15. HT Small Industries

upto 50 kVA 6.31 7.55 84% - (16%)

16. HT Industries-1 50 kVA

to 150 kVA 7.15 7.55 95% - (5%)

17. HT Industries-II above

150 kVA 7.88 7.55 104% +(4%)

18. Tea, Coffee & Rubber 7.87 7.55 104% +(4%)

19. Oil & Coal 8.86 7.55 117% +(17%)

20. HT Irrigation Load

above 7.5 HP 8.15 7.55 108% +(8%)

Note: (+) Cross-subsidy provided to other consumer categories

(-) Cross-subsidy received from other consumer categories

7.3.2 As can be seen from the above Table, the Average Billing Rate for almost all categories

is within the band of 80% to 120% of ACoS, which is in accordance with the Tariff

Policy.

7.4 Fuel Price and Power Purchase Adjustment Charges (FPPPA)

7.4.1 Fuel Price and Power Purchase Adjustment charges as per the Regulations notified

by the Commission are applicable. As per Regulation 5.2 of the AERC (Fuel and Power

Purchase Price Adjustment) Regulations, 2010 “The FPPPA charges shall not exceed

25% of the variable cost component of tariff or such other ceiling as may be stipulated

by the Commission from time to time, where the variable component of tariff is defined

as total estimated revenue from energy charges (EC) in a year the approved in the

Tariff Order divided by total estimated sales of the year. When FPPPA charges exceed

25% of the variable component of tariff, the licensee shall make a petition to the

Commission for recovery of the charges over the specified cap which shall be


recovered after Commission’s scrutiny and directives”.

7.4.2 APDCL shall strictly follow the above Regulation and when FPPPA charges exceed

25% of the variable components of the tariff, APDCL shall file a Petition before the

Commission and FPPPA charges beyond 25% of the variable cost component of tariff

shall be recovered only after Commission’s scrutiny and approval.


8 Wheeling Charges and Cross-Subsidy Surcharge

8.1 Introduction

8.1.1 The Commission has, in the present Order, determined the Wheeling Charges and

Cross-Subsidy Surcharge applicable for Open Access consumers of APDCL for FY

2021-22.

8.2 Allocation Matrix

8.2.1 APDCL submitted that it has retained the Allocation Matrix considered in previous Tariff

Orders by the Commission for allocation of expenses between the Wires Business and

Retail Supply Business for FY 2021-22.

8.2.2 Accordingly, APDCL has proposed the following separation of ARR for Wires and

Supply Business for FY 2021-22:

Table 111: Separation of ARR for Wires and Retail Supply Business for FY 2021-22 as

submitted by APDCL (Rs. Crore)

Sr.

No. Particulars

Gross

Amount

Wires

Business

Retail

Supply

Business

1 Power Purchase Expenses 6028.53 0.00 6028.53

2 Employee Expenses 837.99 502.79 355.20

3 R&M Expenses 255.90 230.31 25.59

4 A&G Expenses 53.19 26.60 26.60

5 Depreciation 62.53 56.28 6.25


7 Interest on Working Capital - - -

8 Interest on CSD 38.06 - 38.06

9 Return on Equity 287.33 258.60 28.73

10 Provisioning for Bad & Doubtful Debts 22.10 - 22.10

11 Less: Non-Tariff Income 409.75 - 409.75


Total ARR 6964.40 1157.36 5807.04


8.2.3 The Commission has considered the following Allocation Matrix for allocation of


expenses between the Wires Business and Retail Supply Business, as adopted in its

previous Orders:

Table 112: Allocation Matrix for Separation of ARR for Wires Business and Retail

Supply Business for FY 2021-22

Sr.

No.

Particulars Wires

Business

Retail Supply

Business

1 Power Purchase expenses 0% 100%

2 Employee expenses 60% 40%

3 Repair and Maintenance expenses 90% 10%

4 Administration and General expenses 50% 50%

5 Depreciation 90% 10%

6 Interest and Finance charges 90% 10%

7 Interest on Working Capital 10% 90%

8 Interest on Consumers’ Security deposit 0% 100%

9 Provision for Bad & Doubtful debts 0% 100%

10 Return on Equity 90% 10%

11 Other Income 10% 90%

12 Non-Tariff Income 0% 100%

8.2.4 The Commission has adopted the above Allocation Matrix for segregation of the

approved ARR for the Wires Business and Retail Supply Business for APDCL for FY

2021-22, as given below:

Table 113: Separation of ARR for Wires Business and Retail Supply Business for FY

2021-22 (Rs. crore)

Sr.

No.

Particulars Total ARR Wires

Business

Retail

Supply

1 Power Purchase expenses 5,444.22 - 5,444.22

2 Employee expenses 813.58 488.15 325.43

3 R&M expenses 210.62 189.55 21.06

4 A&G expenses 45.56 22.78 22.78

5 Depreciation 16.65 14.99 1.67

6 Interest and Finance charges 24.31 21.88 2.43

7 Interest on Working Capital 5.11 0.51 4.60

8 Interest on Consumers’ Security

Deposit 38.06 - 38.06

9 Provision for Bad & Doubtful Debts 22.10 - 22.10


Sr.

No.

Particulars Total ARR Wires

Business

Retail

Supply

10 Return on Equity 75.91 68.32 7.59


12 Less: Non-Tariff Income 395.62 - 395.62

13 ARR 5,943.69 770.50 5,173.18

8.3 Wheeling Charges

8.3.1 APDCL submitted the projected Wheeling Charges applicable for distribution open

access consumers at 33 kV voltage level for FY 2021-22 based on the ARR allocated

to the Distribution Wires Business, as shown in the following Table:

Table 114: Wheeling Charges submitted by APDCL for FY 2021-22

Sr.

No.


1 Net ARR of Wires Business Rs. Crore 1157.36

2 Total Energy Input into Distribution system MU 10,141

3 Distribution Cost for Wires Business for 33 kV

voltage level (assuming 35% of cost at 33 kV) Rs. Crore 405.08

4 Wheeling charges for 33 kV Voltage level Rs./kWh 0.40


8.3.2 The Wheeling Charges applicable for Distribution Open Access consumers at 33 kV/11

kV voltage level for FY 2021-22, have been determined from the ARR allocated to the

Distribution Wires Business, as shown in the Table below:

Table 115: Wheeling Charges approved by the Commission for FY 2021-22

Sr.

No. Particulars Units Total

1 Net ARR of Wire Business Rs. Crore 770.50

2 Total Energy Input into Distribution system MU 9,455

3 Distribution Cost for Wires Business for 33 kV

voltage level (assuming 35% of cost at 33 kV) Rs. Crore 269.68

4 Wheeling charges for 33 kV/11 kV voltage level paise/kWh 29

8.3.3 The Wheeling Charges for FY 2021-22 as determined in the above Table, are


applicable for use of the distribution system of APDCL by other Licensees or

generating companies or captive power plants or consumers/users who are permitted

Open Access at 33 kV/11 kV voltage level under Section 42(2) of the Electricity Act,

2003.

8.4 Applicable Wheeling Losses

8.4.1 The Wheeling Losses applicable for Open Access transactions for FY 2021-22 shall

be as under:

Table 116: Wheeling Losses approved by the Commission for FY 2021-22

Sr. No. Particulars Total

1 At 33 kV level 5%

2 At 11 kV level 11%

8.5 Cross-Subsidy Surcharge (CSS)

8.5.1 The Open Access consumers are liable to pay the CSS to compensate the utility for

any loss of revenue due to the shifting of the consumer to the Open Access system.

Eligible consumers with a connected load of 1 MW and above shall be allowed Open

Access.

8.5.2 APDCL has proposed CSS for HT-II Commercial Category, HT-IV (i) Bulk Supply Govt.

Edu. Institutions category, HT-IV (ii) Bulk Supply Others category, HT-V (C) HT

Industry category, HT-VI Tea, Coffee & Rubber category, and HT-VII Oil & Coal

category, as shown in the Table below:

Table 117: Category-wise CSS submitted by APDCL for FY 2021-22

Particulars Legend Rs./kWh

Average Billing Rate for HT Commercial category A 9.54

Average Billing Rate for HT Bulk Supply - Govt. Edu. Inst.

Category B 8.69

Average Billing Rate for HT Bulk Supply Others category C 10.02

Average Billing Rate for HT-II Industry above 150 kW category D 9.88

Average Billing Rate for Tea, Coffee & Rubber category E 9.84

Average Billing Rate for Oil & Coal category F 9.33

Average Cost of Supply G 8.23

CSS for HT Commercial category H = A - G 1.31

CSS for HT Bulk Supply - Govt. Edu. Inst. Category I = B - G 0.47

CSS for HT Bulk Supply Others category J = C - G 1.80

CSS for HT-II Industry above 150 kW category K = D - G 1.65



CSS for Tea, Coffee & Rubber category L = E - G 1.62

CSS for Oil & Coal category M = F - G 1.10


8.5.3 The Commission has computed the CSS for relevant category of consumers for FY

2021-22, as the difference between the ABR and ACoS for the category, subject to the

limit of 20% of ABR in accordance with the Tariff Policy, 2016, as shown in the Table

below:

Table 118: Category-wise CSS for FY 2021-22 as approved by the Commission


ABR for HT Commercial category A 8.83

ABR for HT Bulk Supply - Govt. Edu. Inst. Category B 7.35

ABR for HT Bulk Supply Others category C 8.54

ABR for HT-II Industry above 150 kW category D 7.88

ABR for Tea, Coffee & Rubber category E 7.87

ABR for Oil & Coal category F 8.86

Average Cost of Supply G 7.55

CSS for HT Commercial category H = A - G 1.28

CSS for HT Bulk Supply - Govt. Edu. Inst. Category I = B - G 0.00

CSS for HT Bulk Supply Others category J = C - G 0.99

CSS for HT-II Industry above 150 kW category K = D - G 0.33

CSS for Tea, Coffee & Rubber category L = E - G 0.32

CSS for Oil & Coal category M = F - G 1.31

8.6 Applicability of Tariff

8.6.1 The approved Retail Supply Tariffs, Wheeling Charges and CSS for FY 2021-22 shall

be effective from April 01, 2021 and shall continue until replaced by a subsequent

Order of the Commission.

Sd/-

(S.N. Kalita)

Member, AERC

Sd/-

(B. Borthakur)

Member, AERC

Sd/-

(K.S Krishna)

Chairperson, AERC


9 Directives

The Commission issued certain directives to APDCL in the past Orders, with an objective of

attaining operational efficiency and streamlining the flow of information, which would be

beneficial to the sector and the Petitioner, both in the short-term and long-term.

As regards the directives issued by the Commission in the Tariff Order dated 7th March, 2020,

APDCL submitted a report to the Commission on compliance. The Commission has reviewed

the compliance of directives as submitted by APDCL and the status is as follows:

Status of Directives issued in the Tariff Order dated 7th March, 2020

Directive 1: Safety measures

The Commission directs APDCL to take up awareness campaigns related to Electrical Safety

among the consumers. The Commission further directs that APDCL should take up training

of their technical persons especially at the field levels, on electrical safety related matters.

Simultaneously, the maintenance works for ensuring safety of the network in identified

vulnerable areas during the monsoons should be taken up on priority.

APDCL is further directed to submit quarterly reports regarding the implementation of safety

measures as suggested in the detailed project report prepared by APDCL as per the direction

of the Commission.

Status:

APDCL submitted that the Company decided to observe Safety Day on 26th of every month to

review the safety practices and also to create and renew safety consciousness among its own

staff and consumers.

During the Covid-19 pandemic period, APDCL organized Zoom conferences on the Safety

Day where various topics were discussed including safety practices.

APDCL entrusted the duties and responsibilities of Electrical Safety Officer to CGM (Marketing

& CR) of APDCL. Directions have been issued from his Office to all field officials for

compulsorily use of safety equipment, PPE kit, etc; in all Electrical Construction, Maintenance

and other related works and also instructed that no worker should be engaged in such works

without proper protection equipment.

APDCL has also been regularly publishing safety related matters, quickies, etc. in print media,

electronic media and social media.


Commission’s views:

APDCL has complied with the directive. The Commission desires that APDCL continue to

carry out similar initiatives in future.

Directive 2: Energy Accounting

The Commission observes that there is no proper energy accounting in APDCL because of

absence of proper metering system at the interconnection points. This has become evident

during the execution of the pilot project of energy auditing taken up by the Commission in the

3 Electrical Circles, namely, GEC-II, Jorhat and Silchar.

The Commission directs APDCL to complete the metering at 33kV, 11 kV and DTR level for

ascertaining the voltage wise losses, proper energy accounting and assessment of technical

and commercial losses. The Commission is allocating an amount of Rs 10 (Ten) crore as

earmarked fund in addition to the fund already available to APDCL under various schemes.

The installation of the proper metering systems in the network should be completed within FY

2020-21.

APDCL is directed to submit the metering plan to be executed with the above Rs 10 crore

within 30th April, 2020.

Status:

APDCL informed that metering at different levels is being carried out under various Schemes

like IPDS, UDAY, SOPD, etc. The draft energy and revenue audit report of the three circles of

APDCL prepared by M/S PPS ENERGY SOLUTIONS is being examined for submission of

views/observations. Proper assessment can be made after finalisation of the report.

Meanwhile, various activities under different schemes got delayed in the wake of COVID

pandemic. APDCL requested the Commission to consider extension of the special allowance

considering the force majeure situation, as there is no certainty of State Govt. funding during

the year in the wake of COVID.

Commission’s views:

The Special Fund for metering for Energy Audit has been considered as Rs. 3.50 Crore, as

estimated by APDCL for FY 2020-21, against the amount of Rs. 10 Crore approved in the

Tariff Order in view of the reduced expenses on account of COVID protocols. The Commission

has issued fresh directive on the issue.


Directive 3: Replacement of Defective Consumer Meters

APDCL has stated that 9.06 lakh consumer meters are defective. APDCL should take up a

special drive to replace these meters by issuing notices to the consumers (where meters are

supplied by the consumers) and replacing the meters from APDCL fund (where APDCL is

collecting monthly rent against the meters).

APDCL shall draw up an action plan within 30th April, 2020 and submit the same to the

Commission.

Status:

APDCL informed that the Company procured 108500 numbers of 1-ph DLMS compliant

meters from funding under SOPD 2019-20 on 11.05.2020. All these meters were allocated to

each Electrical Circle for specific use against stopped/defective matters. APDCL further

informed that further procurement during FY 2020-21 is dependent on funding from State

Government after normalization of COVID situation. At present all funding has been stopped.


APDCL should continue to replace defective consumer meters and pursue the matter of funds

with the State Government. A fresh directive has been issued on this issue.

Directive 4: Sample Survey to detect tampering of Prepaid Meters

A number of cases of tampering / bypassing of prepaid meters has been brought to the notice

of the Commission. The Commission directs APDCL to carry out a sample survey to detect

any bypassing/ tampering of prepaid meters.

Status:

Sample survey was carried out on various prepaid meter installations in compliance to the

directive.


Noted.


Directive 5: Maintenance of Distribution Sub-stations

An appropriate mechanism for proper maintenance of the distribution sub-stations and lines

is necessary for good quality, reliable power supply and also for reduction of distribution

losses. While outsourcing of manpower for maintenance of the distribution substations may

be beneficial to the Company in the short-term, as financial involvement is less, however,

involving its own manpower for the task would help the Company in developing expertise

among the field level technical persons, which is likely to accrue greater benefits in the long

run.

The Commission, therefore, advises APDCL to have a relook at the strategy of managing

33/11 kV sub-stations through outsourcing, considering the long-term benefits.

Status:

APDCL submitted that with serious dearth in manpower vis-à-vis commissioning of various

sub-stations, APDCL was compelled to outsource maintenance of sub-stations. A RFP was

floated for handing over of 86 Sub-stations in 36 packages (14 packages with three Sub-

stations and 22 packages with two Sub-stations) with detailed cost benefit analysis.

Meanwhile, the same will be reviewed with materialisation of recruitment process in future for

optimal yield.

Commission views:

APDCL must build its own maintenance teams for every subdivision as a long-term strategy

and the Commission has issued fresh directive in this regard.

Directive 6: Formation of GPF Trust

Till formation of the GPF Trust, APDCL should keep the GPF contributions of employees

including the past liabilities in a separate bank account.

Status:

APDCL submitted that most of the employees under GPF are scheduled to attain age of

superannuation within 2024. As such, it is evident that the subscription amount will not be

adequate to meet the outflow. However, a dedicated bank account is maintained for

disbursement of GPF.

Commission views:

Noted.


New Directives:

The Commission hereby issues the following new Directives to APDCL:

Directive 1: Energy Accounting

• The Commission directs APDCL to complete the metering at 33 kV, 11 kV and

DTR level in order to have a proper energy accounting system in place.

• Status report as on 31st December, 2020 should be submitted within 1 month.

• 100% metering shall be completed by 31st December, 2021.

• An in-house system of monitoring of the meters and network at 33 kV, 11 kV and

DTR level at each Electrical Circle should be introduced.

• All the defective meters shall be replaced within 31st December, 2021. A detailed

Plan in this regard should be submitted to the Commission within 30th April,

2021.

Directive 2: Reduction of Power theft

The Distribution Losses are still quite high in many Circles, as detailed in this Order.

• APDCL should undertake frequent vigilance raids to catch incidences of power

theft so that the Distribution Losses are minimised.

• APDCL should submit quarterly reports within 15 days of the end of each quarter

regarding the vigilance drives undertaken, additional amounts billed, cases

filed, etc.

Directive 3: Power Purchase

• APDCL should take all measures to optimise its power purchase cost.

• APDCL is directed to study different options for optimising its power purchase

portfolios for peak and off-peak periods and submit a comprehensive report to

the Commission within 30th September, 2021.

Directive 4: Prepaid and Smart Meters

• APDCL should simply the process for recharging the prepaid meters and make

it more consumer friendly. APDCL should explore the possibility of automated


recharge as is the practice in the telecom sector. APDCL shall submit a detailed

plan in this regard within 30th June, 2021.

• APDCL shall submit a comprehensive report to the Commission on the status of

smart metering projects in the State within 30th June, 2021.

Directive 5: FPPPA

• APDCL shall comply with the AERC (Fuel and Power Purchase Price

Adjustment) Regulations, 2010, to adjust the differential cost of power purchase.

The Commission may be constrained to disallow the carrying cost arising out of

gap in power purchase cost if the same is on account of APDCL’s failure to

recover the variation in power purchase cost in accordance with the aforesaid

Regulations.

Directive 6: Capacity Building

• The Commission directs APDCL to complete the recruitment process within the

MYT Control Period, in line with the manpower planning study conducted for all

3 Companies. APDCL should submit the Report on manpower planning study

within 1 month of issue of this Order. The organisational structure should duly

incorporate the effect of ERP implementation.

• APDCL should submit the training calendar for its employees for FY 2021-22,

duly approved by its Board, within 2 months of issue of this Order.

• In order to facilitate preventive and scheduled maintenance of Distribution

Substations and lines on time, dedicated Maintenance Teams should be

developed for every subdivision. APDCL should also plan proper training

programmes for these Maintenance Teams, as part of the training calendar to be

submitted within 2 months of issue of this Order, i.e., within April 15, 2021.

Directive 7: Implementation of HVDS to reduce distribution losses

APDCL submitted that number of LT consumers and LT lines have increased with

implementation of RGGVY/ DDUGJY/Saubhagya Schemes and these have made reduction

in distribution losses difficult.

• The Commission directs APDCL to implement High Voltage Distribution System

(HVDS) to reduce distribution losses, reduce lengths of LT lines and improve

voltage regulation.


• APDCL is directed to submit an investment plan on the above to the

Commission within 30th September, 2021.

Directive 8: Improvement of Power Quality

• APDCL is directed to take appropriate steps to improve quality of service to its

consumers. The quality of power supply needs improvement, especially in the

rural areas. Adequate steps need to be taken so that reliable, uninterrupted and

quality power is made available to the consumers. A report on steps taken

should be submitted by 30th June, 2021.

• APDCL is further directed to furnish the Standards of Performance Reports in

pursuance to the provisions of the AERC (Distribution Licensees’ Standard of

Performance) Regulations, 2004 every quarter and a comparative statement of

the SOP achieved including reliability indices for past five years within 30th

September, 2021.

Directive 9: Consumer education and awareness

The Commission in the Tariff Order has already allocated special provision for consumer

awareness. The Commission is pleased to note that steps have been initiated by APDCL for

creating consumer awareness. However, further initiatives need to be taken.

• The Commission directs that APDCL should continue to take up awareness

campaigns on Electricity Safety and Consumer Grievance Redressal among the

consumers. An Activity Calendar for creating consumer awareness for FY 2021-

22 along with the cost estimation should be submitted to the Commission by

30th June, 2021.

Directive 10 – Coordination Committee

It has been observed by the Commission that there are common issues relating to power

generation, transmission, and distribution, which have been adversely affecting power supply

to consumers and which can be resolved by effective coordination between the three

Companies namely, APGCL, AEGCL and APDCL.

• The Commission, therefore, directs that a Coordination Committee be

constituted consisting of senior Officers from APGCL, AEGCL, SLDC and

APDCL for settlement of matters of common interests relevant to generation,


evacuation of power and supply to consumers. The Committee shall be headed

by the CGM, SLDC. This Coordination Committee shall meet as often as required,

but at least once in every quarter of each year. The Minutes of Meeting of each

Coordination Committee meeting shall be submitted to the Commission within

15 days of such meeting.

• The Commission directs that the Committee is to be constituted within 3 weeks

of issue of this Order, and a report regarding its constitution shall be submitted

to the Commission within 15th March, 2021.

APDCL is directed to submit the status of compliance of above Directives to the

Commission at the end of each quarter. The Commission will review the status in the

month following the end of that quarter.

Sd/- Sd/- Sd/-

(S.N. Kalita) (B. Borthakur) (K. S. Krishna)

Member, AERC Member, AERC Chairperson, AERC


10 Tariff Schedule

This Chapter details the tariffs applicable in the State of Assam with effect from April 1, 2021

until replaced/modified by a subsequent Order of the Commission.

For the purpose of this Schedule, the consumers are divided into two distinct groups based

on voltage of supply, i.e., LT Group and HT Group. The consumers are further divided into

categories based on purpose of supply and nature of supply.

Common Terms & Conditions for both, LT Group and HT Group

(a) Surcharge for delayed payment: Surcharge @ 1.5% per month or part thereof at simple

interest shall be levied, if payment is not made in full on or before the due date.

(b) Payments shall be made by cash/local cheque/DD/Electronic Transfer (where

applicable): For all payments made by DD, the commission shall be borne by the

consumers.

(c) The Tariff does not include any tax or duty, etc., on electrical energy that may be payable

at any time in accordance with any law/State Government Rule in force. Such charges,

if any, shall be payable by the consumers in addition to tariff charge.

LT GROUP

Supply Voltage 1 Ph, 230 V AC and 3 Ph, 415 V AC

Common Terms & Conditions for LT Group

(a) For the purpose of determination of monthly fixed charge based on Connected Load, the

Connected Load shall be rounded up to the next higher kW if the decimal is higher than 0.5

and the nearest lower kW if the decimal is lower than 0.5.

(b) For Jeevan Dhara consumers having Connected Load below 0.5 kW, Connected Load

shall be rounded off to 0.5 kW.

Power factor penalty and rebate

[Applicable for LT IV –Commercial, LT V – General Purpose Supply, LT VIII – Small Industries,

and HT I – Domestic, HT II – Commercial, HT III – Public Water Works, HT IV – Bulk Supply,

HT V (A) - Small Industries, HT V (B) – HT I Industry, HT V (C) – HT II Industry, HT VI – Tea,

Coffee & Rubber, HT VII – Oil & Coal, HT VIII – Irrigation, and HT X – Electric Crematorium]


(a) Power Factor Rebate:

a. In case, the average PF (leading or lagging) maintained by the consumer is

more than 0.85 and up to 0.95, a rebate of 1% on the Energy Charges on unit

consumption shall be applicable;

b. For PF (leading or lagging) of 0.95 and above up to 0.97, a rebate of 2% on the

Energy Charges on unit consumption shall be applicable;

c. For PF (leading or lagging) of 0.97 and above up to Unity PF, a rebate of 3%

on the Energy Charges on unit consumption shall be applicable.

(b) Power Factor Penalty:

a. In case average PF (leading or lagging) in a month for a consumer falls below

0.85, a penalty @1% for every 1% fall in PF (leading or lagging) from 0.85 to

0.60; plus 2% for every 1% fall below 0.60 shall be levied on total unit

consumption. PF penalty shall be levied on those consumers where PF is

recorded electronically.

LT Category-1 Jeevan Dhara:

Applicability

This Tariff shall be applicable for supply of power to any premises exclusively for the purpose

of own requirements with a Connected Load of not more than 0.5 kW and consumption up to

1 kWh/day or 30 kWh per month.

Consumption Energy Charge Fixed Charge

For consumption upto 30

kWh per month.

Rs. 4.25/kWh Rs. 20 per connection per

month

If any Jeevan Dhara consumer consumes more than 30 units per month for 2 consecutive

months, then such consumer should be transferred to Domestic A category and billed

accordingly thereafter, irrespective of the number of units consumed

LT Category –II: Domestic A:

Applicability

This tariff shall be applicable for supply of power to consumers having connected load below

5 kW for residential premises, exclusively for domestic purposes only. This shall also include

supply of power to occupants of flats in multi-storied buildings, if the premises have not been

classified under Domestic B or HT Domestic and receiving bulk power at single point without


any individual metering arrangements for domestic purposes.

Consumption Energy Charge Fixed Charge

First 120 kWh per month Rs. 4.90/kWh

Rs. 50/kW/ month From 121 – 240 kWh per

Month

Rs. 6.15/kWh

Balance kWh Rs. 7.15/kWh

NOTE:

If any part of the domestic connection is utilised for any use other than dwelling purpose like

commercial, industrial, etc., the entire consumption shall be treated under that category and

the respective tariff shall be applied for the entire consumption.

LT Category-III: Domestic-B:

Applicability

This tariff shall be applicable for supply of power to consumers having Connected Load of 5

kW and above up to 25 kW exclusively for domestic purposes only. This shall also include

bulk supply at single point for supply to occupants of flats in multi-storied buildings having

individual metering for domestic purposes.

Energy Charge Fixed Charge

For all consumption Rs 6.75/kWh Rs. 50/kW/month

NOTE:




LT Category-IV: LT Commercial:

Applicability

This tariff shall be applicable for supply of power to consumers having Connected Load up to

25 kW to all establishments and institutions of commercial nature and connected with trading

activities, including commercial offices, Government and public sector commercial

installations, commercial houses, optical houses, shops, hotels, restaurants, bars,

refreshment stalls, showcases of advertisements, theatres, cinema halls, guest houses,

laundries, dry-cleaners, Railway stations, public and private bus-stands not covered under any


other category of consumers, copy works, X-ray installations, private nursing homes/clinical

laboratories, photographic studios, battery charging units, workshops, petrol pumps, factory &

printing presses not using motive power in the manufacturing process, private educational and

cultural institutions (excluding institutions covered under the LT V General Purpose Supply),

lodging and boarding houses.


For all consumption Rs. 7.20/kWh Rs. 130/kW/month

LT Category V- LT General Purpose Supply:

Applicability

a. This tariff shall be applicable for supply of power to consumers having Connected Load

up to 25 kW to all Non-commercial and Non-domestic users of electric power like

Government offices, Government Educational and cultural institutions, Government

hospitals, dispensaries, Charitable institutions and Trusts (public or private formed

solely for charitable or religious purposes), Dharamshala, Non-commercial boarding

and lodging houses and other Non-commercial institutions, Private Educational

Institutions affiliated to Secondary Education Board of Assam (SEBA) / Assam Higher

Secondary Education Council (AHSEC) / Central Board of Secondary Education

(CBSE) / Council for the Indian School Certificate Examination (CISCE) and

Universities approved by Government of Assam



b. Government Primary and Secondary / Higher Secondary Schools


For all consumption. Rs. 6.15/kWh Rs. 70/kW/month

LT Category VI-Public Lighting:

Applicability

This tariff is applicable to supply of power for street lighting systems in Municipalities, Town

Committees and Panchayat, etc., Signal systems in roads and park lighting, in areas of

Municipality/Town Committee/Panchayat, etc.




N.B. In case any unmetered supply is provided in exigency, the energy shall be assessed

considering 12 hours per day burning hours for the energy charge. For example, if the total

connected load of the street light service is 1 kW, energy shall be assessed as 12 units per

day.

LT Category VII-Agriculture:

Applicability

This tariff shall be applicable for supply of power for agriculture / irrigation purpose in the

agricultural sector having Connected Load up to 25 kW.


For all consumption. Rs. 4.30/kWh Rs. 45/kW/month

LT Category VIII – Small Industries:

Applicability

This tariff is applicable for supply of power for industrial purposes having licence from

designated authority of appropriate Government and not covered under any other category,

for consumers having Contract Demand/Connected Load up to 25 kW.

Category Energy Charge Fixed Charge

Rural Industries – for all consumption Rs. 4.75/kWh Rs. 50/kW/month

Urban Industries - for all consumption Rs. 5.00/kWh Rs. 60/kW/month

In addition to the above Base Tariff, the following Time of Day (TOD) tariff for LT-VIII Small

Industries shall be optionally applicable:

Time Slot Energy charge (Rs./kWh)

0600 hrs to 1700 hrs (normal) 0.00

1700-2200 hrs (peak) (+) 2.00


2200-0600 hrs (night off-peak) (-) 2.00

LT Category IX: Temporary Supply:

Applicability

This Tariff will be applicable for electric supply of power at LT, which is temporary in nature for

a period not exceeding one month.

Category Charges

Domestic Rs. 85/kW/day or Rs. 9.09/kWh whichever is higher

Non-Domestic Non- Agricultural Rs.135/kW/day or Rs. 11.19/kWh whichever is higher

Agricultural Rs. 45/kW/day or Rs. 4.35/kWh whichever is higher.

LT Category X- Electric Vehicles Charging Station:

Applicability

This tariff is applicable to consumers who use electricity exclusively for Electric Vehicle

Charging installations at LT level.



Note: Consumers can charge their own Electric Vehicles at their respective premises, paying

the charge applicable to the consumer category.

HT GROUP

Tariff for this group is applicable for those consumers availing power supply at 11 kV or above.

Calculations shall be deemed to be in kVA for consumers under this part of the tariff schedule.

However, consumers above 25 kW (or 30 kVA) Connected Load and drawing power at LT are

also covered under this Group. During the period of conversion from LT supply to HT supply,

the consumer shall have to pay the necessary compensatory charges (10% and 3% of total

energy consumption for LT line & DTR, respectively).

Common Terms & Conditions for HT Group

a. For supply at voltages higher than as applicable to the consumers, rebate @ 3% shall be

applicable on energy consumption for each higher level of voltage, and a surcharge of 3%

shall be applicable if consumer draws power at lower than the applicable voltage level.


b. In case, metering is done on the L.T. side of the distribution transformer, for a group of

consumers receiving power, then for the purpose of billing, an additional energy

consumption on account of transformer loss computed @ 3% on the consumer’s Energy

Charges shall be added.

c. Voltage Rebate

i. A rebate of 3% in the Energy Charges shall be applicable for all consumers taking

supply at 132 kV.

ii. ii) A rebate of 1.5% in the Energy Charges shall be applicable for all consumers

taking supply at 33 kV.

d. Contract Demand: The Contract Demand shall be as per the Agreement executed

between the consumer and APDCL. In case declaration/option is not made by the

consumer, 100% of the Connected Load converted to kVA shall be the contracted demand.

e. Billable Demand: Billing demand shall be 100% of Contracted Demand or Recorded

Demand, whichever is higher. In case the meter remains defective in a month, billing

demand shall be considered as per clause 6.3.4 of AERC (Electricity Supply Code)

Regulations, 2017, as amended from time to time.

f. Overdrawal Penalty: If the Recorded Demand is higher than the Contracted Demand in

a month, then fixed charge based on Contracted Demand shall be levied at three times

the normal rate for the portion of demand exceeding the Contracted Demand.

HT Category I: HT Domestic

Applicability

This tariff shall be applicable for supply of power to consumers having Connected Load above

25 kW (or 30 kVA) to residential premises, exclusively for domestic purposes only. This shall

also include supply of power to occupants of flats in multi storied buildings/ residential colony,

receiving bulk power at single point with single metering for domestic purposes.


For all consumption Rs 6.80/kWh Rs 50/kVA/month

NOTE:





HT Category-II: HT Commercial

Applicability

This tariff shall be applicable for supply of power to consumers having Connected Load above

25 kW (or 30 kVA) to all establishments and institutions of commercial nature and connected

with trading activities, including commercial offices, Government and public sector commercial

installations, commercial houses, optical houses, shops, shopping malls, restaurants, hotels,

bars, refreshment stalls, showcases of advertisements, theatres, cinema halls, guest houses,

laundries, dry-cleaners, Railway stations, public and private bus-stands not covered under any

other category of consumers, copy works, X-ray installations, private nursing homes/clinical

laboratories, photographic studios, battery charging units, workshops, petrol pumps, factory &

printing presses not using motive power in the manufacturing process, private educational and

cultural institutions (excluding institutions covered under the HT IV (i) Bulk Supply –

Educational Institutions), lodging and boarding houses.


For all consumption. Rs. 7.10/kWh Rs. 180/kVA/month

HT Category - III: Public Water Works

Applicability

This tariff is applicable for public water supply maintained by Government or Government

Corporations, Municipalities, Town Committees and Panchayats.



HT Category – IV: Bulk Supply

Applicability

This tariff is applicable to Bulk consumers with a Connected Load above 25 kW (or 30 kVA)

provided that the consumers not covered by any other category such as any domestic

connection, industries, tea, etc., and who make their own internal distribution arrangement at

their own cost and receive power at the point of supply at high or extra high voltage. This is

further classified as under:


(i) Educational institution-

a. Government Educational Institutions

b. Private Educational Institutions affiliated to Secondary Education Board of

Assam (SEBA) / Assam Higher Secondary Education Council (AHSEC) /

Central Board of Secondary Education (CBSE) / Council for the Indian

School Certificate Examination (CISCE) and Universities approved by

Government of Assam

(ii) Others - categories not included in any of the above categories, including

Government offices, Railways, Military Engineering Services, etc.

(i) Educational Institutions



(ii) Others


For all consumption. Rs. 7.20/kWh Rs.180/kVA/month

HT Category V (A): HT Small Industries;

Applicability

This tariff is applicable for supply of power for industrial purposes having licence from


for consumers with Connected Load above 25 kW (or 30 kVA) and up to 50 kVA, irrespective

of location of the industry in rural area or urban area.



In addition to the above Base Tariff, the following Time of Day (TOD) tariff for HT-V (A)

Industries shall be optionally applicable:



1700-2200 hrs (peak) (+) 2.00



HT Category V (B)-HT-I Industries

Applicability

This tariff is applicable for supply of power to industrial consumers having licence from


at a single point for industrial purposes with Contract Demand/Connected Load above 50 kVA

and up to 150 kVA.

Energy Charge (Base

Tariff)

Fixed Charge

For all consumption Rs. 5.85/kWh Rs. 160/kVA/month

TOD tariff

In addition to the above Base Tariff, the following Time of Day (TOD) tariff for HT-I industries

shall be applicable:

Time Slot Energy charge (Rs. /kWh)


1700-2200 hrs (peak) (+) 2.00


HT Category V (C): HT-II Industries

Applicability

This tariff is applicable for supply of power at a single point for industrial purposes having

licence from designated authority of appropriate Government and not covered under any other

category, for Contract Demand/Connected Load above 150 kVA.

(a) Tariff

A consumer may opt for any one of the following Options depending on his requirements by

prior intimation to concerned billing unit of Discom. A consumer may change his Option only

after six months of availing that particular Option.

Option -1

Energy Charge

(Base Tariff)

Fixed Charge



In addition to the above Base Tariff, the following Time of Day (TOD) tariff for HT-II Industries

shall be applicable:



1700-2200 hrs (peak) (+) 2.00


Option -2



No TOD Tariff will be applicable for consumers who opt for Option-2.

HT Category VI-Tea, Coffee and Rubber:

Applicability

This tariff is applicable for tea, coffee and rubber plantation/production by utilisation of

electrical power in factory, irrigation, lighting, etc., in the Estate.

Energy Charge

(Base Tariff)

Fixed Charge


In addition to the above Base Tariff, the following Time of Day (TOD) tariff for HT-VI Tea,

Coffee & Rubber shall be applicable:



1700-2200 hrs (peak) (+) 2.00


HT Category VII - Oil and Coal

Applicability

This tariff shall be applicable for supply of power to consumers at a single point for installations

of Oil and Coal Sector.


Energy Charge (Base

Tariff)

Fixed Charge

For all consumption Rs 7.40/kWh Rs. 300/kVA/month

In addition to the above Base Tariff, the following Time of Day (TOD) tariff for HT-VII Oil and

Coal shall be applicable:



1700-2200 hrs (peak) (+) 2.00


HT Category VIII: HT Irrigation

Applicability

This tariff shall be applicable for electricity supply for agriculture / irrigation purpose in the

agricultural sector for pump set above 25 kW (or 30 kVA) and for whom power has been

supplied at 11 kV or above.



HT Category IX: Temporary Supply

Applicability

This Tariff will be applicable for electric supply of power at HT which is temporary in nature for

a period not exceeding one month.

HT Category – X: Electric Crematorium

Applicability

This tariff is applicable for electricity used in Electric Crematoriums for all purposes, including

lighting.

Charges

Rs. 170/kVA/day or Rs. 8.85/kWh, whichever is higher




HT Category – XI: Railway Traction

Applicability

This tariff is applicable to the Railways for traction loads.



HT Category – XII: Electric Vehicles Charging Stations

Applicability

This tariff is applicable to consumers who use electricity exclusively for Electric Vehicle

Charging installations at HT level.



Note: Consumers can charge their own Electric Vehicles at their respective premises, paying

the charge applicable to the consumer category.

This Tariff Order shall continue to be applicable until it is replaced/modified by a

subsequent Order of the Commission.

This Tariff Order is signed by the Assam Electricity Regulatory Commission on February

15, 2021.

These Tariffs take effect from April 01, 2021.

Sd/- Sd/- Sd/-

(S.N. Kalita)

Member, AERC

(B. Borthakur)

Member, AERC

(K.S. Krishna)

Chairperson, AERC


11 Annexure 1: Minutes of the 27th Meeting of the

State Advisory Committee

VENUE: AERC Conference Hall.

DAY/DATED: Saturday, 19th December, 2020.

LIST OF MEMBERS/SPECIAL INVITEES: At Annexure-1 (Enclosed)

The 27th Meeting of State Advisory Committee (SAC) was chaired by the Hon’ble Chairperson,

AERC, Shri S C Das, IAS, (Retd.)

The Hon’ble Chairperson, welcomed all members and invitees to the 27th meeting of SAC and

thanked all members for their presence, even after postponing the meeting twice due to

COVID and the demise of former CM Late Tarun Gogoi. Thereafter, Hon’ble Chairperson

asked new members of SAC which had been notified vide No AERC.37/2002/Pt-VI/146 dated

5th August,2020 to introduce themselves. Hon’ble Chairperson opined that all new members

should advise the Commission regarding actions, schemes, etc. for better functioning of the

power sector in the State of Assam.

The welcome address was followed by an introductory session among the members and

invitees. Thereafter, the agenda items were taken up for discussion in seriatim. The important

points discussed in the course of the meeting are briefly recorded below.

Agenda: Confirmation of the Minutes of the 26th Meeting of SAC held on 13.02.2020.

The draft Minutes of the 26th meeting of the Committee was circulated among the Members

and Special Invitees in August 2019. Comments were received from a few members and these

were incorporated in the minutes before finalizing. During the discussion Shri K Medhi,

Secretary NESSIA advised the Commission to fix the timeline for every action to be taken.

The final minutes were confirmed and accepted by the members.

Agenda: Action taken on the minutes of the 26th Meeting of SAC.

A powerpoint presentation was made by Assistant Director (Engineering) AERC, Shri J.

Bezbaruah on the salient features of action taken reports submitted by the power utilities.

Important points of the discussion are noted below-

The members of SAC enquired about the status of 250 MW Natural gas based power station

at Chandrapur and 725 MW Gas based Thermal power station at north bank of Brahmaputra.


APGCL in its action taken report informed that M/S TATA Consulting Engineers Limited has

submitted the draft PFRs for setting up of these power stations.

Shri D.K Sarma, Member, SAC advised that there should be a comprehensive generation plan

of APGCL so that it can cater to the growing load demand of the state. Hon’ble Chairperson

said that Principal Secretary, Department of Power, GoA had already taken note of that.

Regarding high cost of power from NEEPCO’s Pare Hydro Electric Project and the expected

high cost of power from NHPC’s Subansiri Hydro Electric Project, the Hon’ble Chairperson

and Hon’ble Member (Technical) advice GoA to take up the matter with MoP. Shri Subodh

Sharma also advised APDCL to take up the matter with GoA, he also pointed out regarding

high PoC charge on with Hon’ble Chairperson information the members that new regulation

by CERC is going to be placed very soon.

Shri Subodh Sharma, Member, SAC advised APDCL to make a study on the Solar project and

its commercial effect.

Agenda: Presentation by Power Grid on NERPSIP Project.

A brief presentation was made by M/s Power Grid Corporation of India Ltd. on North Eastern

Region Power System Improvement Project (NERPSIP),

➢ Sanctioned Project Cost : Rs.1473.80 Cr (Feb’14 price level)

➢ Revised Project Cost : Rs.1914.58 Cr.

➢ Funding of the Project : 50:50 (Govt. of India : World Bank)

➢ Expected Completion: Progressively till Dec’21

In the presentation, PGCIL has also submitted the present progress of EHV SS, Extn. & Aug.

of Existing EHV Substations, EHV Transmission Lines, New 33/11kV Substations, Extn. of

33/11kV Substations and 33kV Line,

PGCIL highlighted certain RoW issues where they sought assistant for early completion of the

line. Hon’ble Chairperson advised to take assistance from local administration to complete the

projects.

Agenda: Discussion on the approach to the Tariff determination by AEGCL, APGCL and

APDCL.

The three companies APDCL, APGCL, and AEGCL made a brief presentation on the tariff

determination for the FY 2021-22. Salient features of the tariff determination as mentioned

below –


APDCL -

Particulars for FY 2021-22 APDL Projected

(Rs Crore)

a. Standalone Aggregate Revenue Requirement

6964.4

a1. Addl RoE on enhancement of equity

261.29

A. Net amount without addl RoE (a - a1)

6703.1

B. True up for FY 2019-20 250.14

C. Rebate from CPSU for COVID during FY 20-21

69.99

Total (A+B-C): 6883.25

Average Rate (Rs./kWh) 8.23

Proposed increase (%) 5%

APGCL -

Particulars for FY 2021-22 APGCL Projected

Gross Generation (MU) 1480.35

Auxiliary Consumption (%) 3.40%

Net Generation (MU) 1430.27

Total Fixed Charges (Rs. Crore)

220.52

Fuel Cost (Rs. Crore) 151.48

Total Revenue Requirement (Rs. Crore)

371.99

Fixed Charge Per Unit (INR / kWh)

1.54

Energy Charge Per Unit (INR / kWh)

1.06

Proposed Tariff (INR / kWh) 2.6

AEGCL

Particulars for FY 2021-22 AEGCL Projected

Aggregate Revenue Requirement

427.79

Net Aggregate Revenue Requirement

417.79

Transmission Charge (Rs./ kWh)

0.396


During the presentation of APGCL was asked to give a supplementary tariff petition

incorporating estimated generation of NRPP.

Agenda: Comment and suggestion of the Members.

MD, APDCL has mentioned that APDCL is going to hold a recruitment drive as the acute

shortage of manpower is hampering its functions. Prof. M.P Bezbaruah and Sri Subodh

Sharma advised APDCL to train the employees to multitask so that in case of future

automation in meter reading and billing the same employees can be engaged in other

functions.

Hon’ble Chairperson has emphasized on improving the power quality in the state of Assam

and also informed the members that AERC has formulated power quality regulation which is

available on the website.

Harsh Sutodia, Member, AIMO acknowledged the working of the power utilities during the

pandemic situation and managing the power situation efficiently during this time. He advised

APDCL in regards to ease the process of service connection to HT consumers. He mentioned

that the power supply to the industries and tea gardens of Golaghat and Tinsukia has been

unreliable during past months which will adversely affect the revenue of APDCL. In this regard,

ABITA added that the progress of work of the dedicated tea garden feeder is very slow.

Hon’ble Chairperson advised MD, APDCL to co-ordinate with ABITA to ensure early

completion of tea garden dedicated feeders so that power supply to tea gardens become

reliable.

The meeting ended with a vote of thanks from and to the Chair.

Sd/-

Secretary,

Assam Electricity Regulatory Commission


ANNEXURE-1

LIST OF MEMBERS, SPECIAL INVITEES AND OFFICERS PRESENT.

Members

1. Shri Subhash Ch.Das, IAS (Retd.), Chairperson, AERC

2. Smt. Bulbuli Borthakur, Member (Law), AERC

3. Shri Satyendra Nath Kalita, Member (Technical), AERC

4. Shri Neeraj Verma, IAS, Principal Secretary, GoA, Deptt. Of Power (Elec)

5. Shri Probin Ch Bora, Joint Secretary, Department of Food, Civil Supplies &

Consumer Affairs, GoA

6. Shri Subodh Sarma, Power Engineer

7. Shri Champak Barua, Former – Member (Technical), APDCL

8. Shri Dilip Sarma, Former Executive Director, Power Grid

9. Shri Uttpal Kr Sharma, representative from Senior Engineers Forum, Guwahati

10. Shri Abhijit Sharma, Secretary, ABITA

11. Shri Harsh Sutodiya, EC Member, AIMO, Assam

12. Shri J N Baruah, General Secretary, AASSIA, Assam

13. Shri Saurabh Agarwal, Chairperson, FINER

14. Shri Sailen Baruah, President, NESSIA

15. Shri Kumud Ch Medhi, General Secretary, NESSIA

16. Shri M P Bezbaruah, Professor, Guwahati

17. Shri A B Kandali, Associate Professor, JEC

Special Invitees

1. Sri Rakesh Agarwal, IAS, MD, APDCL

2. Shri Dhrubajyoti Hazarika, MD, AEGCL

3. Shri Balbir Singh, Sr.GM, PGCIL

4. Shri Somiran Das, Sr.DGM, PGCIL

Officers from APDCL, AEGCL & APGCL

1. Shri Chandan Sharma, CGM, SLDC, AEGCL

2. Shri Deepankar Deka, CGM (O&M), AEGCL

3. Shri P K Saikia, CGM (PP&D), AEGCL

4. Shri A K Nath, GM (HQ), AEGCL

5. Shri G K Bhuyan, GM, AEGCL

6. Shri Suresh Kaimal, DGM (F&A), AEGCL


7. Shri H S Mohan, DGM, SLDC, AEGCL

8. Shri A J Choudhury, AGM (HQ), AEGCL

9. Shri Ashok Kalita, CGM (Gen), APGCL

10. Shri A Bhuyan, CGM (PP&I), APGCL

11. Shri J P Choudhury,CGM (NRE), APGCL

12. Mrs Lipika Das, AGM, APGCL

13. Mrs Pinki Deb, AM(F&A), APGCL

14. Shri Prodyut Kr Nath, JM, APGCL

15. Shri Nilmadhab Deb, AGM (F&A), APDCL

for assam power distribution company limited (apdcl)apdcl order for truing-up of fy 2019-20, apr of...

Documents