Industry associations in Coimbatore have requested the Tamil Nadu Electricity Regulatory Commission (TNERC) to defer taking any decision on revision of power tariff now as it would have to again take up the revision process in a few weeks.
They also feel that any move to revise the power tariff now would snuff out the nascent revival of industries in the region.
Speaking to newsmen in Coimbatore on Wednesday evening after chairing a meeting of about 25 industry associations to discuss the power tariff revision proposal, D Balasundaram, President, Tamil Nadu Electricity Consumers’ Association (TECA), said the TNERC had taken up suo motu the issue of tariff revision since the TANGEDCO had failed to initiate the process. He said the stakeholders were given neither sufficient data nor time to go through any claim made for tariff revision and the process has been sought to be rushed through.
He conceded that the power tariff could be revised every year based on valid factors and the industry associations were not questioning that. But they wanted the tariff revision issue to be deferred since the tariff revision process would have to start afresh in the coming weeks so as to be given effect from April 1, 2015. Rather than revising the electricity tariff now, that would be in force for about four months only, the regulatory authority could wait for the fresh revision process to be completed for implementation from April 1, he argued.
Balasundaram said the TANGEDCO would have to submit its case for any tariff revision to be implemented from April 1 next year before the month-end. In case of any failure on its part, TNERC would have to kick-start the process before December 31. In view of this, he felt that the regulator need not rush through the revision process now, as it would be in effect for just about four months.
Asked what remedy the industry associations here would seek in case the TNERC went ahead with announcing its decision on tariff revision now, he said they were not in favour of adopting a confrontationist stance. But he hinted that the industries might go in appeal against any such decision by the TNERC.
The TECA President said to bridge the gap of about Rs 7,000 crore in its revenue, TANGEDCO should look at a basket of proposals, of which tariff revision should be a part. He said the power tariff in Tamil Nadu was amongst the highest in the country. Instead of utilising fully the State’s wind energy potential, which was the cheapest source of power, the State was scouting for power from other sources at a much higher cost. The interest cost suffered by TANGEDCO was the highest among the electricity boards and many times more than States such as Maharashtra, Gujarat and AP, he said.
He also raised the question of appropriateness of two members of TNERC, who were retired employees of TANGEDCO, deciding on the issue of tariff revision as TANGEDCO was an interested party in the issue. When the consumers were already reeling under the impact of load shedding and demand recession, the tariff hike had come as a shocker. He feared that if the proposed tariff hike was implemented for industrial consumers, energy charges would go up by nearly 31 per cent and demand charges would spike up by 17 per cent. With other levies, the hike would be much steeper.
Balasundaram said while the State electricity board had not added appreciable generation capacity as compared to States such as Maharashtra, Gujarat and Andhra Pradesh, the number of employees was far higher. While in Tamil Nadu the number of employees per million KWHrs (units) of power was 1.27, in Karnataka it was 0.83 and in Maharashtra, a bigger and more industrialised State, it was lesser still at 0.64. The State also suffered higher transmission and distribution losses compared to some of these States. By plugging revenue and power losses, the board would be able to boost its finances and need not have to depend entirely on tariff revision to present a healthier balance sheet, he said.
Jayakumar Ramdas, Chairman, Institute of Indian Foundrymen, Coimbatore chapter, said the foundry sector in Coimbatore had lost out to its rivals outside the State earlier because of problems such as an acute power shortage. The stabilisation of power supply had renewed hopes that the industry would be able to win back lost market share. But the threat of an upward revision of power tariff had shaken such hopes.
The meeting was attended, among others, by V Lakshminarayanasamy, President, Southern India Engineering Manufacturers’ Association (Siema), and E K Ponnuswamy, President, Coimbatore District Small Industries’ Association (Codissia).