GUJARAT ELECTRICITY REGULATORY COMMISSION

Tariff Order
Truing up for FY 2017-18,
Mid-Term Review of ARR for FY 2019-20 to 2020-21
and Determination of Tariff for FY 2019-20

For

Uttar Gujarat Vij Company Limited

(UGVCL)

Case No. 1759 of 2018

24th April, 2019

6thFloor, GIFT ONE, Road 5 - C, Zone 5, GIFT CITY

Gandhinagar-382335 (Gujarat), INDIA
Phone: +91-79-23602000 Fax: +91-79-23602054/55
E-mail: gerc@gercin.org: Website www.gercin.org
GUJARAT ELECTRICITY REGULATORY COMMISSION
(GERC)
GANDHINAGAR

Tariff Order
Truing up for FY 2017-18,
Mid-Term Review of ARR for FY 2019-20 to FY 2020-21
And Determination of Tariff for FY 2019-20

For

Uttar Gujarat Vij Company Limited

(UGVCL)

Case No. 1759 of 2018

24th April, 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

ABBREVIATIONS
A&G Administration and General Expenses
AB Cable Aerial Bunched Cable
APR Annual Performance Review
ARR Aggregate Revenue Requirement
CAGR Compound Annual Growth Rate
CAPEX Capital Expenditure
CERC Central Electricity Regulatory Commission
Control Period FY 2016-17 to FY 2020-21
DGVCL Dakshin Gujarat Vij Company Limited
DISCOM Distribution Company
EHV Extra High Voltage
FPPPA Fuel and Power Purchase Price Adjustment
FY Financial Year
GEB Gujarat Electricity Board
GERC Gujarat Electricity Regulatory Commission
GETCO Gujarat Energy Transmission Corporation Limited
GFA Gross Fixed Assets
GoG Government of Gujarat
GSECL Gujarat State Electricity Corporation Limited
GUVNL Gujarat UrjaVikas Nigam Limited
HT High Tension
JGY Jyoti Gram Yojna
kV Kilo Volt
kVA Kilo Volt Ampere
kVAh Kilo Volt Ampere Hour
kWh Kilo Watt Hour
LT Low Tension Power
MCLR Marginal Cost of Funds based Lending Rate
MGVCL Madhya Gujarat Vij Company Limited
MTR Mid-Term Review
MUs Million Units (Million kWh)
MW Mega Watt
MYT Multi Year Tariff
O&M Operation & Maintenance
PF Power Factor
PFC Power Finance Corporation
PGCIL Power Grid Corporation of India Limited
PGVCL Paschim Gujarat Vij Company Limited
PPA Power Purchase Agreement
PPPA Power Purchase Price Adjustment
R&M Repair and Maintenance
RE Revised Estimate
RLDC Regional Load Despatch Centre
SBAR State Bank Advance Rate
SBI State Bank of India
SLDC State Load Despatch Centre
UGVCL Uttar Gujarat Vij Company Limited
WRLDC Western Regional Load Despatch Centre
YoY Year on Year

Gujarat Electricity Regulatory Commission Page v

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

CONTENTS

1 Background and Brief History..............................................................................2

1.1 Background ................................................................................................................. 2
1.2 Uttar Gujarat Vij Company Limited (UGVCL) ............................................................... 2
1.3 Commission’s Orders for the second Control period ................................................... 3
1.4 Commission’s Order for approval of True Up for FY 2016-17 and determination of
Tariff for FY 2018-19.......................................................................................................... 3
1.5 Background for the present petition ............................................................................. 4
1.6 Admission of the Petition and Public Hearing Process ................................................ 4
1.7 Approach of this Order ................................................................................................ 6
1.8 Contents of this Order ................................................................................................. 7

2 Summary of Truing up for FY 2017-18 and Tariff for FY 2019-20 ......................8

2.1 Introduction ................................................................................................................. 8
2.2 True Up for FY 2017-18 .............................................................................................. 8
2.3 Revenue Surplus/(Gap) for FY 2017-18 ..................................................................... 9
2.4 Mid-Term Review for FY 2019-20 and FY 2020-21 ..................................................... 9
2.5 Request of UGVCL ................................................................................................... 10

3 Brief outline of objections raised, response from UGVCL and the

Commission’s View................................................................................................... 11
3.1 Stakeholders’ suggestions / objections, Petitioner’s Response and Commission’s
observation ...................................................................................................................... 11
3.2 Suggestions/Objections Common to all DISCOMs .................................................... 11
3.3 Issues pertaining to UGVCL ...................................................................................... 46

4 Truing up of FY 2017-18 ...................................................................................... 48

4.1 Energy sales ............................................................................................................. 48
4.2 Distribution Losses .................................................................................................... 49
4.3 Energy requirement ................................................................................................... 50
4.4 Power Purchase Cost................................................................................................ 51
4.5 Gain / (Loss) due to Distribution Losses .................................................................... 53
4.6 Fixed Charges ........................................................................................................... 55
4.6.1 Operation and Maintenance (O&M) Expenses for FY 2017-18 .................................. 55
4.6.2 Capital expenditure, Capitalization and Funding of CAPEX ....................................... 61
4.6.3 Depreciation ................................................................................................................ 69
4.6.4 Interest and Finance charges...................................................................................... 72
4.6.5 Interest on Working Capital ......................................................................................... 74
4.6.6 Bad Debts Written Off ................................................................................................. 76
4.6.7 Return on Equity ......................................................................................................... 77
4.6.8 Taxes........................................................................................................................... 79
4.6.9 Non-Tariff Income ....................................................................................................... 80
4.7 Revenue from Sale of Power ..................................................................................... 81
4.8 ARR approved in the truing up .................................................................................. 82
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 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

4.9 Sharing of Gain / Loss for FY 2017-18 ...................................................................... 83

4.10 Revenue (Gap) / Surplus for FY 2017-18 ............................................................ 84

5 Mid-Term Review of ARR for FY 2019-20 and FY 2020-21 ............................... 87

5.1 Introduction ............................................................................................................... 87
5.2 Submission of UGVCL .............................................................................................. 87
5.2.1 Summary of the petition for Mid-Term review for the remaining control period, FY
2019-20 and FY 2020-21 .......................................................................................................... 87
5.3 Estimation of ARR for the remaining years of control period, FY 2019-20 and FY
2020-21 ........................................................................................................................... 88
5.4 Energy Sales ............................................................................................................. 89
5.4.1 Projection of Energy sales for FY 2019-20 and FY 2020-21 ...................................... 89
5.4.2 Consumer Profile ........................................................................................................ 90
5.4.3 Category-wise Connected Load .................................................................................. 91
5.4.4 Category-wise Projected Growth rates of energy sales .............................................. 92
5.4.5 Detailed Analysis of Energy Sales projected .............................................................. 93
5.4.6 Total Energy Sales .................................................................................................... 100
5.5 Distribution Losses .................................................................................................. 101
5.6 Energy Requirement and Energy Balance............................................................... 101
5.7 Energy Balance ....................................................................................................... 102
5.8 Power Purchase Cost – Petitioner’s Submission ..................................................... 103
5.8.1 Power Purchase Sources.......................................................................................... 103
5.8.2 Power Purchase Cost ............................................................................................... 107
5.8.3 Transmission and other Cost .................................................................................... 111
5.8.4 Total Power Purchase Cost ...................................................................................... 112
5.8.5 Net Power Purchase Cost ......................................................................................... 113
5.8.6 Bulk Supply Tariff (BST)............................................................................................ 113
5.9 Power Purchase Cost – Commission’s analysis ...................................................... 114
5.9.1 Power Purchase Sources.......................................................................................... 114
5.9.2 Power Purchase during FY 2019-20 and FY 2020-21 .............................................. 114
5.9.3 Merit Order dispatch and Total Energy requirement including tradable energy ....... 119
5.9.4 Power Purchase Cost for the period FY 2019-20 and FY 2020-21 .......................... 121
5.9.5 Transmission and Other Costs.................................................................................. 126
5.9.6 Total Power Purchase Cost ...................................................................................... 127
5.10 Allocation of Power Purchase Cost ................................................................... 128
5.11 Capital Expenditure .......................................................................................... 132
5.12 Fixed Charges .................................................................................................. 136
5.12.1 Operations and Maintenance (O&M) Expenses ....................................................... 136
5.12.2 Depreciation .............................................................................................................. 140
5.12.3 Interest and Finance Charges .................................................................................. 141
5.12.4 Interest on Working Capital ...................................................................................... 143
5.12.5 Provision for Bad and Doubtful Debts ...................................................................... 144
5.12.6 Return on Equity ....................................................................................................... 145
5.12.7 Income Tax ............................................................................................................... 146
5.12.8 Non-Tariff Income ..................................................................................................... 146
5.13 Aggregate revenue Requirement (ARR) ........................................................... 147

6 ARR and (Gap) for FY 2019-20 ......................................................................... 149

Gujarat Electricity Regulatory Commission Page vii

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

6.1 Revenue from existing Tariff................................................................................... 149

6.2 Revenue from FPPPA charges ............................................................................... 150
6.3 Other consumer related income .............................................................................. 152
6.4 Agriculture Subsidy ................................................................................................. 152
6.5 Total Expected Revenue for FY 2019-20................................................................. 153
6.6 ARR for FY 2019-20 ................................................................................................ 153
6.7 Estimated Revenue (Gap)/Surplus for FY 2019-20 for UGVCL ............................... 154
6.8 Consolidated Revenue (Gap)/Surplus of the State Owned DISCOMs ..................... 155

7 Compliance of directives .................................................................................. 156

7.1 Compliance to earlier directives .............................................................................. 156
7.2 Fresh directives ....................................................................................................... 162

8 Fuel and Power Purchase Price Adjustment .................................................. 163

8.1. Fuel Price and Power Purchase Price Adjustment .................................................. 163
8.2. Base Price of Power Purchase (PPCB) ................................................................... 163
8.3. Shifting of Base FPPPA .......................................................................................... 164

9 Wheeling charges and cross subsidy surcharge ........................................... 166

9.1. Allocation matrix ...................................................................................................... 166
9.2. Wheeling charges ................................................................................................... 167
9.3. Cross Subsidy Surcharges ...................................................................................... 168

10 Tariff Philosophy and Tariff Proposals ........................................................... 170

10.1. Introduction ....................................................................................................... 170
10.2. DISCOMs Tariff Proposal and Changes in Tariff Structure ............................... 170
10.3. Rationalization of Tariff ..................................................................................... 171
10.3.1 Extending benefit of Optional Demand Based Tariff to small consumers ................ 171
10.3.2 Numbers of Slabs in RGP Tariff Category................................................................ 171
10.3.3 Reduction in the Tariff for Lift Irrigation. ................................................................... 171
10.4. Deletion of Prompt Payment Rebate clause from the Tariff Schedule ............... 172
COMMISSION’S ORDER .............................................................................................. 173
ANNEXURE: TARIFF SCHEDULE ............................................................................... 174

Gujarat Electricity Regulatory Commission Page viii

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

LIST OF TABLES
Table 2-1: ARR proposed by UGVCL for FY 2017-18 True up ................................................................. 8
Table 2-2: Revenue Surplus/(Gap) as claimed by UGVCL ....................................................................... 9
Table 2-3: Mid-Term Review for FY 2019-20 and FY 2020-21 as projected by UGVCL .......................... 9
Table 4-1: Category-wise sales for FY 2017-18 ...................................................................................... 48
Table 4-2: Energy sales approved in truing up for FY 2017-18 ............................................................... 49
Table 4-3: Distribution Losses.................................................................................................................. 49
Table 4-4: Distribution Losses approved for truing up for FY 2017-18 .................................................... 50
Table 4-5: Energy requirement and Energy balance as submitted by UGVCL for FY 2017-18 .............. 50
Table 4-6: Energy requirement approved by the Commission for truing up for FY 2017-18 ................... 51
Table 4-7: Power Purchase Cost claimed by UGVCL for FY 2017-18 .................................................... 51
Table 4-8: Power Purchase Cost submitted by UGVCL for FY 2017-18 ................................................. 52
Table 4-9: Power Purchase Cost as per the audited accounts for FY 2017-18 ...................................... 53
Table 4-10: Power Purchase Cost approved by the Commission for truing up for FY 2017-18 .............. 53
Table 4-11: Gain/ (Loss)on account of Distribution Losses for FY 2017-18 as submitted by UGVCL .... 54
Table 4-12: Approved Gain/ (Loss) on account of Distribution Losses for FY 2017-18 .......................... 54
Table 4-13: Approved gain / (loss) – power purchase expenses for truing up for FY 2017-18 ............... 55
Table 4-14: O&M Expenses claimed in the truing up for FY 2017-18 ..................................................... 55
Table 4-15: O&M Expenses and Gain / Loss claimed in the truing up for FY 2017-18 ........................... 56
Table 4-16: Employee Cost claimed by UGVCL in the truing up for FY 2017-18.................................... 56
Table 4-17: Employee Cost approved in the truing up for FY 2017-18 ................................................... 57
Table 4-18: R&M Expenses claimed by UGVCL for the truing up for FY 2017-18 .................................. 58
Table 4-19: R&M Expenses approved for the truing up for FY 2017-18 ................................................. 58
Table 4-20: A&G Expenses claimed by UGVCL in the truing up for FY 2017-18.................................... 59
Table 4-21: A&G Expenses approved in the truing up for FY 2017-18 ................................................... 60
Table 4-22: Other Expenses Capitalized as claimed by UGVCL in the truing up for FY 2017-18 .......... 60
Table 4-23: Other Expenses Capitalized approved in the truing up for FY 2017-18 ............................... 61
Table 4-24: Approved O&M expenses and Gain / Loss in the truing up for FY 2017-18 ........................ 61
Table 4-25: Capital expenditure claimed by UGVCL for FY 2017-18 ...................................................... 61
Table 4-26: Proposed Capitalisation and sources of funding by UGVCL for FY 2017-18 ....................... 68
Table 4-27: Approved Capitalisation and sources of funding in the truing up for FY 2017-18 ................ 69
Table 4-28: Fixed assets & depreciation computed by UGVCL for FY 2017-18 ..................................... 70
Table 4-29: Gain / Loss due to deprecation claimed in the truing up for FY 2017-18 ............................. 71
Table 4-30: Approved fixed assets & depreciation for FY 2017-18 ......................................................... 71

Gujarat Electricity Regulatory Commission Page ix

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

Table 4-31: Gain / Loss due to Depreciation approved in the truing up for FY 2017-18 ......................... 72
Table 4-32: Interest and Finance Charges claimed by UGVCL in the truing up for FY 2017-18 ............ 72
Table 4-33: Interest and Finance Charges claimed by UGVCL in the truing up for FY 2017-18 ............ 72
Table 4-34: Gain / (Loss) claimed due to Interest & Finance Charges for FY 2017-18 .......................... 73
Table 4-35: Interest and Finance Charges approved by the Commission in the truing up for FY 2017-
18 ............................................................................................................................................................. 74
Table 4-36: Gain / (Loss) approved in the truing up for FY 2017-18 ....................................................... 74
Table 4-37: Interest on Working Capital claimed by UGVCL in the truing up for FY 2017-18 ................ 75
Table 4-38: Interest on working capital claimed by UGVCL in the truing up for FY 2017-18 .................. 75
Table 4-39: Interest on working capital approved in the truing up for FY 2017-18 .................................. 76
Table 4-40: Bad Debts claimed by UGVCL in the truing up for FY 2017-18 ........................................... 76
Table 4-41: Bad Debts Written Off for FY 2017-18 .................................................................................. 76
Table 4-42: Gain/ (Loss)due to Bad Debts approved in the Truing up for FY 2017-18 ........................... 77
Table 4-43: Return on Equity claimed by UGVCL in the truing up for FY 2017-18 ................................. 77
Table 4-44: Return on Equity claimed by UGVCL in the truing up for FY 2017-18 ................................. 78
Table 4-45: Return on Equity approved for FY 2017-18 .......................................................................... 78
Table 4-46: Approved Gain / Loss due to Return on Equity in the truing up for FY 2017-18 .................. 79
Table 4-47: Taxes claimed by UGVCL in the truing up for FY 2017-18 .................................................. 79
Table 4-48: Gain / (Loss) claimed due to provision for taxes for FY 2017-18 ......................................... 79
Table 4-49: Approved Gain / Loss due to tax in the truing up for FY 2017-18 ....................................... 80
Table 4-50: Non-Tariff Income claimed by UGVCL in the truing up for FY 2017-18 ............................... 80
Table 4-51: Gain / (Loss) claimed due to Non-Tariff Income for FY 2017-18 .......................................... 80
Table 4-52: Approved Gain / losses due to Non-Tariff Income in the truing up for FY 2017-18 ............. 81
Table 4-53: Revenue submitted in the truing up for FY 2017-18 ............................................................. 81
Table 4-54: Revenue approved in the truing up for FY 2017-18 ............................................................. 82
Table 4-55: ARR approved in truing up for FY 2017-18 .......................................................................... 83
Table 4-56: Revenue Surplus/ (Gap) for FY 2017-18 .............................................................................. 85
Table 4-57: Revenue Surplus/(Gap) approved in the truing up for FY 2017-18 ...................................... 86
Table 5-1: Mid-Term Review for FY 2019-20 and FY 2020-21................................................................ 88
Table 5-2: Historical Trend in Category-wise Units sold .......................................................................... 89
Table 5-3: Category-wise Growth rate of Units Sold ............................................................................... 90
Table 5-4: Category-wise number of Consumers .................................................................................... 90
Table 5-5: Growth rate of Number of Consumers .................................................................................... 90
Table 5-6: Category-wise of Connected Load ......................................................................................... 91
Table 5-7: Growth Rate of Connected Load ............................................................................................ 91

Gujarat Electricity Regulatory Commission Page x

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

Table 5-8: Projected Growth Rates .......................................................................................................... 92

Table 5-9: Projected Energy sales for FY 2018-19, 2019-20 and 2020-21 ............................................. 92
Table 5-10: Sales approved for Residential category in the Mid-Term Review....................................... 93
Table 5-11: Sales approved for GLP category in the Mid-Term Review ................................................. 94
Table 5-12: Approved Sales for Non-RGP & LTMD Category together in the Mid-Term Review ........... 95
Table 5-13: Sales approved for Public Water Works in the Mid-Term Review........................................ 95
Table 5-14: New Metered connections to Agricultural Consumer ........................................................... 96
Table 5-15: Consumption of metered Consumers approved in the Mid-Term Review............................ 98
Table 5-16: Approved Sales for Agriculture Consumers in the Mid-Term Review .................................. 98
Table 5-17: Energy Sales approved for FY 2019-20 and FY 2020-21 .................................................... 99
Table 5-18: Approved Sales for Industrial HT category in the Mid-Term Review .................................. 100
Table 5-19: Energy Sales approved in the Mid-Term Review ............................................................... 100
Table 5-20: Projected Distribution Losses for FY 2019-20 and FY 2020-21 ......................................... 101
Table 5-21: Projected Energy Requirement and Energy Balance ......................................................... 102
Table 5-22: Total approved Energy Requirement in the Mid-Term Review .......................................... 102
Table 5-23: Approved Energy Balance in the Mid-Term Review ........................................................... 103
Table 5-24: Existing Capacity contracted by GUVNL ............................................................................ 103
Table 5-25: Capacity Addition during the remaining control Period ...................................................... 105
Table 5-26: Procurement from RE for Meeting Projected RPO ............................................................ 106
Table 5-27: Projected Power Purchase cost for FY 2019-20 ................................................................ 108
Table 5-28: Projected Power Purchase cost for FY 2020-21 ................................................................ 109
Table 5-29: Projected Transmission charges for FY 2019-20 and FY 2020-21 .................................... 112
Table 5-30: GUVNL Cost for FY 2019-20 and FY 2020-21 ................................................................... 112
Table 5-31: Projected Fixed cost for DISCOMs for FY 2019-20 and FY 2020-21................................. 113
Table 5-32: Projected Variable cost for DISCOMs and trading of energy from FY 2019-20 and FY 2020-
21 ........................................................................................................................................................... 113
Table 5-33: Projected Net Power Purchase cost for FY 2019-20 and FY 2020-21 ............................... 113
Table 5-34: Capacity Contracted Source – Wise by GUVNL in the MYT Order and Now Submitted by
UGVCL for the period FY 2019-20 and FY 2020-21 .............................................................................. 114
Table 5-35: Energy Available & Dispatchable as approved in MYT order and projected in MTR for FY
2019-20 .................................................................................................................................................. 115
Table 5-36: Energy Available & Dispatchable as approved in MYT order and projected in MTR for FY
2020-21 .................................................................................................................................................. 117
Table 5-37: Availability and Dispatchable as approved in MYT Order and as Projected in MTR for FY
2019-20 and FY 2020-21 ....................................................................................................................... 119
Table 5-38: Energy requirement and Energy dispatchable as projected by the DISCOMs .................. 120

Gujarat Electricity Regulatory Commission Page xi

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

Table 5-39: Energy requirement projected and approved for each DISCOM for .................................. 120
Table 5-40: Approved Power Purchase Cost for FY 2019-20 ............................................................... 121
Table 5-41: Approved Power Purchase Cost for FY 2020-21 ............................................................... 123
Table 5-42: Transmission charges approved by the Commission for period ........................................ 126
Table 5-43: GUVNL Costs approved by the Commission for the period FY 2019-20 and FY 2020-21 127
Table 5-44: SLDC charges approved by the Commission for FY 2019-20 and FY 2020-21 ................ 127
Table 5-45: Fixed cost of DISCOMs for the period FY 2019-20 and FY 2020-21 ................................. 127
Table 5-46: Variable cost for DISCOMs and Trading Units for the period FY 2019-20 and FY 2020-
21 ........................................................................................................................................................... 128
Table 5-47: Total Cost of Power for DISCOMs for FY 2019-20 and FY 2020-21.................................. 128
Table 5-48: Category Wise sales approved and existing average tariff in Rs./kWh .............................. 129
Table 5-49: Revenue with existing Tariffs for FY 2019-20 and FY 2020-21 with approved sales ......... 130
Table 5-50: Aggregate Revenue Requirement for Power Purchase for FY 2019-20 and FY 2020-21 . 131
Table 5-51: Total Revenue (Gap) for FY 2019-20 and FY 2020-21 ...................................................... 131
Table 5-52: Energy Requirement and Percentage Energy required for FY 2019-20 and FY 2020-21 . 131
Table 5-53: Allocation of Gap for FY 2019-20 ....................................................................................... 131
Table 5-54: Allocation of Gap for FY 2020-21 ....................................................................................... 132
Table 5-55: Bulk Supply Tariff for FY 2019-20....................................................................................... 132
Table 5-56: Bulk Supply Tariff for FY 2020-21....................................................................................... 132
Table 5-57: Capital Expenditure loan in the Mid-Term Review for FY 2019-20 and FY 2020-21 ......... 133
Table 5-58: Funding of Capitalisation projected in Mid-Term Review ................................................... 135
Table 5-59: Approved CAPEX vs Actual CAPEX & Actual Capitalization for FY 2016-17 and FY 2017-18
............................................................................................................................................................... 136
Table 5-60: Approved CAPEX, Capitalization and Funding for the FY 2019-20 and FY 2020-21 ........ 136
Table 5-61: O&M expenses projected for the FY 2019-20 and FY 2020-21 ......................................... 137
Table 5-62: Consolidated Employee Cost of all DISCOMs ................................................................... 138
Table 5-63: O&M expenses approved in the Mid-Term Review ............................................................ 139
Table 5-64: Depreciation projected for the Control Period FY 2019-20 to FY 2020-21 ........................ 140
Table 5-65: Depreciation approved in the Mid-Term Review ................................................................ 141
Table 5-66: Interest and Guarantee Charges projected in the Mid-Term Review ................................. 141
Table 5-67: Approved Interest and Finance Charges in the Mid-Term Review..................................... 142
Table 5-68: Interest on Working Capital projected in the Mid-Term Review ......................................... 143
Table 5-69: Interest on Working Capital approved in the Mid-Term Review ......................................... 143
Table 5-70: Provision for Bad and Doubtful debts projected for the FY 2019-20 and FY 2020-21 ...... 144
Table 5-71: Bad and Doubtful Debts Written-off approved in the .......................................................... 144

Gujarat Electricity Regulatory Commission Page xii

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

Table 5-72: Return on Equity projected for the Mid-Term Review......................................................... 145
Table 5-73: Approved Return on Equity for the Mid-Term Review ........................................................ 145
Table 5-74: Income Tax projected in the Mid-Term Review .................................................................. 146
Table 5-75: Income Tax approved in the Mid-Term Review .................................................................. 146
Table 5-76: Non-Tariff Income projected in the Mid-Term Review ........................................................ 147
Table 5-77: Non-Tariff income approved for FY 2019-20 and FY 2020-21 ........................................... 147
Table 5-78: Aggregate Revenue Requirement for the FY 2019-20 and FY 2020-21 ............................ 147
Table 6-1: Sales (MUs) and Revenue (Crs.) from existing tariff projected for FY 2019-20 ................... 149
Table 6-2: Approved Sales (MUs) and Revenue from existing tariff for FY 2019-20 ............................ 149
Table 6-3: Projected Revenue from FPPPA Charges for the FY 2018-19 ............................................ 150
Table 6-4 FPPPA Charges for the FY 2019-20 ..................................................................................... 150
Table 6-5: FPPPA Charges for the FY 2019-20 .................................................................................... 151
Table 6-6: Approved Revenue from FPPPA Charges for the FY 2019-20 ............................................ 151
Table 6-7: Other Consumer related Income for FY 2019-20 ................................................................. 152
Table 6-8: Approved other consumer related Income for FY 2019-20 .................................................. 152
Table 6-9: Projected Agriculture Subsidy for FY 2019-20 ..................................................................... 152
Table 6-10: Approved Agriculture Subsidy for FY 2019-20 ................................................................... 153
Table 6-11: Projected Revenue for FY 2019-20 .................................................................................... 153
Table 6-12: Approved Total Revenue for FY 2019-20 ........................................................................... 153
Table 6-13: Approved Mid-Term Review ARR for FY 2019-20 ............................................................. 154
Table 6-14: Estimated Revenue (Gap)/Surplus for FY 2019-20 at Existing Tariff for UGVCL .............. 154
Table 6-15: Consolidated (Gap)/Surplus computed for FY 2019-20 ..................................................... 155
Table 8-1: Base price of power purchase .............................................................................................. 164
Table 9-1: Allocation matrix for segregation of wheeling and retail supply for UGVCL for the FY 2019-
20 ........................................................................................................................................................... 166
Table 9-2: Allocation of ARR between wheeling and retail supply business for UGVCL for FY 2018-
19 ........................................................................................................................................................... 166
Table 9-3: Wheeling Charges for FY 2019-20 ....................................................................................... 167
Table 9-4: Cross subsidy surcharge for FY 2019-20 ............................................................................. 168

Gujarat Electricity Regulatory Commission Page xiii

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

GUJARAT ELECTRICITY REGULATORY COMMISSION

GANDHINAGAR

Case No. 1759 of 2018

Date of the Order 24.04.2019

CORAM

Shri Anand Kumar, Chairman

Shri K. M. Shringarpure, Member
Shri P. J. Thakkar, Member

ORDER

Gujarat Electricity Regulatory Commission Page 1

April 2019
 Uttar Gujarat Vij Company Limited
Truing up for FY 2017-18, Mid- Term Review of FY 2019-20 and FY 2020-21
and Determination of Tariff for FY 2019-20

1 Background and Brief History

1.1 Background
Uttar Gujarat Vij Company Ltd., (hereinafter referred to as “UGVCL” or the “Petitioner”)
has on 30th November, 2018 filed a petition under Section 62 of the Electricity Act,
2003, read with Gujarat Electricity Regulatory Commission (Multi-Year Tariff)
Regulations, 2016, for the Truing up of FY 2017-18, Mid-Term Review of ARR for FY
2019-20 to FY 2020-21 and Determination of retail supply tariff for FY 2019-20.

Gujarat Electricity Regulatory Commission notified the GERC (Multi-Year Tariff)

Regulations, 2016 on 29th March, 2016 which shall be applicable for determination of
tariff in all cases covered under the Regulations from 1st April, 2016 onwards.
Regulation 17.2 (c) of the GERC (Multi-Year Tariff) Regulations, 2016 of GERC
provides for submission of detailed application comprising of truing up for FY 2017-18,
modification of the ARR for the remaining years of the control period, revenue from the
sale of power at existing tariffs and charges for the ensuing year (FY 2019-20), revenue
(Gap) or revenue Surplus for the ensuing year calculated based on Aggregate
Revenue Requirement approved in the MYT Order and truing up for the previous year,
application for determination of tariff for the ensuing year (FY 2019-20) to be carried
out under Gujarat Electricity Regulatory Commission (Multi-Year Tariff) Regulations,
2016 and Amendment there of time to time.

After technical validation of the petition, it was registered on 04th December, 2018 and
as provided under Regulation 29.1 of the GERC (MYT) Regulations, 2016, the
Commission has proceeded with this tariff order.

1.2 Uttar Gujarat Vij Company Limited (UGVCL)

Government of Gujarat unbundled and restructured the Gujarat Electricity Board with
effect from 1st April, 2005. The Generation, Transmission and Distribution businesses
of the erstwhile Gujarat Electricity Board were transferred to seven successor
companies. The seven successor companies are listed below:

Generation Company Gujarat State Electricity Corporation Limited (GSECL)

Transmission Company Gujarat Energy Transmission Corporation Limited (GETCO)

Distribution Companies:

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Sr. No. Name of Company

1 Dakshin Gujarat Vij Company Limited (DGVCL)
2 Madhya Gujarat Vij Company Limited (MGVCL)
3 Uttar Gujarat Vij Company Limited (UGVCL)
4 Paschim Gujarat Vij Company Limited (PGVCL)

Gujarat Urja Vikas Nigam Limited (GUVNL), a holding company, is responsible for
purchase of electricity from various sources and supply to Distribution Companies and
also other activities including trading of electricity.

The Government of Gujarat, vide Notification dated 3rd October, 2006, notified the final
opening balance sheets of the transferee companies as on 1st April, 2005. The value
of assets and liabilities, which stand transferred from the erstwhile Gujarat Electricity
Board to the transferee companies, include Uttar Gujarat Vij Company Limited
(UGVCL). Assets and liabilities (gross block, loans and equity), as on the date
mentioned in the notification, have been considered by the Commission in line with the
Financial Restructuring Plan (FRP), as approved by Government of Gujarat.

1.3 Commission’s Orders for the second Control period

The Petitioner filed its petition for Truing up for 2015-16, Approval of Final ARR for
2016-17, Approval of Multi-Year ARR for FY 2016-17 to FY 2020-21 and Determination
of tariff for 2017- 18 on 30th November 2016. The petition was registered on 03rd
December 2016 (Case No. 1622 of 2016). The Commission vide Order dated 31st
March, 2017 approved the Truing up for 2015-16, Final ARR for 2016-17, Approval of
Multi-Year ARR for FY 2016-17 to FY 2020-21 and determined the tariff for FY 2017-
18.

1.4 Commission’s Order for approval of True Up for FY 2016-

17 and determination of Tariff for FY 2018-19

The Petitioner filed its Petition for Truing-up of FY 2016-17 and determination of tariff
for FY 2018-19 on 15th January, 2018. After technical validation of the petition, it was
registered on 17th January, 2018 (Case No. 1699/2018). The Commission vide Order
dated 31st March, 2018 approved truing up for FY 2016-17 and determined the tariff
for FY 2018-19.

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1.5 Background for the present petition

The Commission has notified the GERC (MYT) Regulations, 2016 for the control period
of FY 2016-17 to FY 2020-21. Regulation 16.2 (i) of the GERC (MYT) Regulations,
2016, provides for filing of Mid- Term Review petition by the utilities and based on
which the Commission shall undertake review of ARR of the utilities for remaining years
of the control period. Further, Regulation 16.2(iii) of the GERC (MYT) Regulations,
2016 provides for the truing up of previous year’s expenses and revenue based on
audited accounts vis a vis the approved forecast and categorisation of variation in
performance as those caused by factors within the control of applicant (controllable
factors) and those caused by factors beyond the control of applicant (uncontrollable
factors).

Also, Regulation 16.2(vi) of the GERC (MYT) Regulations, 2016 provides for annual
determination of tariff for Generating Company, Transmission Licensee ,SLDC,
Distribution Wires Business and Retail Supply Business for each financial year, within
the control period, based on the approved forecast and results of the truing up exercise.

1.6 Admission of the Petition and Public Hearing Process

The Petitioner submitted the current Petition for Truing–up of FY 2017-18, Mid-Term
review of ARR for FY 2019-20 to FY 2020-21 and Determination of retail supply tariff
for FY 2019-20. After technical validation of the petition, it was registered on 04th
December, 2018 (Case No. 1759/2018) and as provided under Regulation 29.1 of the
GERC (MYT) Regulations, 2016, the Commission has proceeded with this tariff order.

In accordance with Section 64 of the Electricity Act, 2003, the Commission directed
UGVCL to publish its application in the abridged form to ensure public participation.

The public notice was issued in the following newspapers on 08th December, 2018
inviting objections / suggestions from its stakeholders on the Mid-Term Review Petition
filed by it.

Sr. No. Name of Newspaper Language Date of Publication

1 The Indian Express English 08.12.2018
2 Sandesh Gujarati 08.12.2018

The petitioner also placed the public notice and the petition on the website
(www.ugvcl.com) for inviting objections and suggestions on its petition. The interested

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parties/stakeholders were asked to file their objections / suggestions on the petition on

or before 07th January,2019.

The Commission also placed the petition and additional details received from the
petitioner on its website (www.gerc.in.org) for information and study of all the
stakeholders. The Commission also issued a notice for public hearing in the following
newspapers in order to solicit wider participation by the stakeholders.

Sl. No. Name of the Newspaper Language Date of publication

1 DNA English 01.02.2019
2 Gujarat Samachar Gujarati 01.02.2019
3 Sandesh Gujarati 01.02.2019

The Commission received objections/suggestions from the consumers/consumer

organizations as shown in the Table below. The Commission examined the objections
/ suggestions received and fixed the date for public hearing for the petition on 07 th
February, 2019 at the Commission’s Office, Gandhinagar, and subsequently a
communication was sent to the objectors to take part in the public hearing process for
presenting their views in person before the Commission. The public hearing was
conducted in the Commission’s Office at Gandhinagar as scheduled on the above
date. The objectors participated in the public hearing and presented its objections.

The status of stakeholders who submitted their written suggestion / objections, those
who remained present in public hearing, those who could not attend the public hearings
and those who made oral submissions is given in the Table below:

Sr. Written Oral Present on

Name of Stakeholders
NO. Submission Submission 07.02.2019
1 Shri Mahavir Jain Aradhana Kendra YES NO NO
Gujarat Krushi Vij Grahak
2 YES YES YES
Surakhsya Sangha (GKVKSS)
Gujarat Udvahan Piyat Sahkari
3 YES YES YES
Sangh Ltd.
4 Bharatiya Kisan Sangh YES NO NO
5 RMG Alloys Steel Ltd. YES YES YES
6 K.K. Bajaj YES YES YES
Federation of Solar Manufacturers
7 YES YES YES
& Intermediaries
8 Greenko Energies Private Ltd. YES NO NO
9 Laghu Udyog Bharati - Gujarat YES YES YES
Utility Users Welfare Associations
10 YES YES YES
(UUWA)
The Gujarat Dyestuff
11 YES YES YES
Manufacturers Associations
12 GCCI YES YES YES

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Sr. Written Oral Present on

Name of Stakeholders
NO. Submission Submission 07.02.2019
Southern Gujarat Chamber of
13 YES YES YES
Commerce & Industries
14 Akhil Gujarat Grahak Sewa Kendra YES NO NO
15 R.G.Tillan No YES YES
16 Rajesh Joshi No YES YES

The issues raised by the objectors, along with the response of UGVCL and the
Commission’s views on the response, are dealt with in Chapter 3 of this Order.

1.7 Approach of this Order

The GERC (Multi-Year Tariff) Regulations, 2016 provide for Truing up of the previous
year, modification of the ARR for the remaining years of the control period and
determination of Tariff for ensuing year for the third Control Period i.e. FY 2016-17 to
FY 2020-21.

UGVCL has approached the Commission with the present petition for Truing up of FY
2017-18, Mid-Term review of ARR for FY 2019-20 and FY 2020-21 and determination
of retail supply tariff for FY 2019-20.

The Commission has undertaken Truing up for the FY 2017-18, based on the
submissions of the Petitioner. The Commission has undertaken the computation of
Gain and losses for FY 2017-18, based on the audited annual accounts.

While truing up of FY 2017-18, the Commission has been primarily guided by the
following principles:
 Controllable parameters have been considered at the level approved as per the
MYT Order, unless the Commission considers that there are valid reasons for
revision of the same.
 Uncontrollable parameters have been revised, based on the actual performance
observed.

The Truing up for the FY 2017-18 has been considered, based on the GERC (MYT)
Regulations, 2011.

Mid-Term review for FY 2019-20 and FY 2020-21 and Determination of Tariff for FY
2019-20 have been considered as per the GERC (Multi-Year Tariff) Regulations, 2016.

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1.8 Contents of this Order

The Order is divided into Ten Chapters as detailed under:-

1. The First Chapter provides a background of the Petitioner, the petition and
details of the public hearing process and approach adopted for this Order.
2. The Second Chapter provides a summary of the petition.
3. The Third Chapter deals with the Public hearing process including the
Objections raised by Stakeholders, UGVCL’s response and the Commission’s
views on the response.
4. The Fourth Chapter deals with the Truing up for FY 2017-18.
5. The Fifth Chapter deals with Mid-Term Review of ARR for FY 2019-20 and FY
2020-21 and
6. The Sixth Chapter deals with Determination of retail supply tariff for FY 2019-
20.
7. The Seventh Chapter deals with compliance of the Directives and issue of
fresh directives for UGVCL.
8. The Eighth Chapter deals with fuel and power purchase adjustments.
9. The Ninth Chapter deals with wheeling and cross subsidy surcharges.
10. The Tenth Chapter deals with tariffs for FY 2019-20.

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2 Summary of Truing up for FY 2017-18 and Tariff

for FY 2019-20

2.1 Introduction
This chapter deals with highlights of the petition as submitted by UGVCL for truing up
of FY 2017-18, Mid-Term Review for Aggregate Revenue Requirement for FY 2019-
20 and FY 2020-21 and determination of retail supply tariff for FY 2019-20.

2.2 True Up for FY 2017-18

UGVCL submitted the petition on 30th November’ 2018 seeking approval of truing up
of ARR for FY 2017-18. UGVCL has worked out its Aggregate Revenue Requirement
(ARR) for FY 2017-18 as a part of the True Up for FY 2017-18. UGVCL has presented
the actual cost components based on audited annual accounts for FY 2017-18. A
summary of the proposed ARR for Truing-up of FY 2017-18 compared with the
approved ARR for FY 2017-18 in the MYT Order dated 31st March, 2017 is presented
in the Table given below:

Table 2-1: ARR proposed by UGVCL for FY 2017-18 True up

(Rs. Crore)
Sr. 2017-18 2017-18
Particulars Deviation
No. (Approved) (Actual)
1 Cost of Power Purchase 8866.95 9004.23 (137.38)
2 Operation & Maintenance Expenses 443.05 623.31 (180.26)
2.1 Employee Expenses 423.58 531.92 (108.34)
2.2 Repairs & Maintenance 80.50 61.36 27.14
2.3 Administration & General Expenses 75.69 99.22 (23.53)
2.4 Other Debits - - -
2.5 Extra Ordinary Item - - -
2.6 Net Prior Period Expenses/(Income) - - -
2.7 Other Expenses Capitalised (144.72) (69.19) (75.53)
3 Depreciation 331.74 262.25 69.49
4 Interest & Finance Charges 136.61 127.71 8.90
5 Interest on Working Capital - - -
6 Provision for Bad Debts 0.70 0.31 .39
7 Sub-Total [1 to 6] 9779.05 10017.81 (238.76)
8 Return on Equity 181.11 179.73 1.38
9 Provision for Tax/Tax Paid 17.14 14.38 2.76
10 Total Expenditure [7 to 9] 9977.30 10211.92 (234.62)
11 Less: Non-Tariff Income 146.76 138.68 8.08
Aggregate Revenue Requirement
12 9830.54 10073.24 (242.70)
[10-11]

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

The revenue (Gap)/ Surplus of UGVCL for FY 2017-18 has been computed taking into
account actual ARR incurred for FY 2017-18 and after treatment of gain/(loss) due to
controllable / uncontrollable factors which is computed at Rs. 34.52 Crore as shown
in the Table below:

Table 2-2: Revenue Surplus/(Gap) as claimed by UGVCL

(Rs. Crore)
Sr.
Particulars Amount
No.
1 Aggregate Revenue Requirement originally approved for 2017-18 9830.54
Gain / (Loss) on account of Uncontrollable factors to be passed on to
2 (314.79)
consumer
Gain / (Loss) on account of Controllable factors to be passed on to
3 24.03
consumer (1/3rd of Total Gain /Loss)
4 Revenue (Gap)/Surplus from True-up of FY 2015-16 126.99
5 Revised ARR for FY 2017-18 (1-2-3-4) 9994.31
6 Revenue from Sale of Power 9129.81
7 Other Income (Consumer related) 256.74
8 Agriculture subsidy 542.26
9 GUVNL Profit / (Loss) allocation 30.98
10 Total Revenue including Subsidy (6+7+8+9) 9959.79
Revised Surplus/(Gap) after treating Gain/(Loss)due to
11 (34.52)
Controllable/ Uncontrollable factors (10-5)

The above revenue Surplus/(Gap) arising based on the true up for FY 2017-18
mentioned above shall be added in the ARR for the FY 2019-20.

2.4 Mid-Term Review for FY 2019-20 and FY 2020-21

The comparison of revised projections for FY 2019-20 and FY 2020-21 in the Mid-
Term Review Vis-a-Vis the costs approved by the Commission in the MYT Order dated
31st March, 2017 as shown in the Table below:

Table 2-3: Mid-Term Review for FY 2019-20 and FY 2020-21 as projected by UGVCL

(Rs. Crore)
2019-20 2019-20 2020-21 2020-21
Sr.
Particulars (Approved in (Projected in (Approved in (Projected in
No.
MYT Order) MTR) MYT Order) MTR)
1 Cost of Power Purchase 9760.79 11156.97 10499.76 11835.84
Operations& Maintenance
2 495.19 840.71 523.51 942.07
Expenses
2.1 Employee Cost 473.43 734.53 500.51 829.82
2.2 Repair & Maintenance 98.91 98.91 104.57 104.57
Administration & General
2.3 84.60 84.60 89.44 89.44
Charges
2.4 Other Debits - - - -
2.5 Extraordinary Items - - - -

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2019-20 2019-20 2020-21 2020-21

Sr.
Particulars (Approved in (Projected in (Approved in (Projected in
No.
MYT Order) MTR) MYT Order) MTR)
Net Prior Period Expenses /
2.6 - - - -
(Income)
2.7 Other Expenses Capitalised (161.75) (77.33) (171) (81.76)
3 Depreciation 399.19 248.47 427.81 273.65
4 Interest & Finance Charges 140.89 189.21 139.64 201.94
5 Interest on Working Capital - - - -
6 Provision for Bad Debts 0.70 0.31 0.70 0.31
7 Sub-Total [1 to 6] 10796.76 12435.67 11591.42 13253.82
8 Return on Equity 212.51 215.36 226.97 231.86
9 Provision for Tax / Tax Paid 17.14 14.38 17.14 14.38
10 Total Expenditure (7 to 9) 11026.41 12665.41 11835.53 13500.06
11 Less: Non-Tariff Income 146.76 138.68 146.76 138.68
Aggregate Revenue
12 Requirement 10879.65 12526.72 11688.77 13361.38
(10 - 11)

2.5 Request of UGVCL

1. To admit this Petition seeking True up of FY 2017-18, Mid-Term Review of ARR
for FY 2019-20 to FY 2020-21 and Determination of Tariff for FY 2019-20.
2. To approve the True up for FY 2017-18 and allow sharing of Gain/(Loss) with the
Consumers as per sharing mechanism prescribed in the GERC (MYT)
Regulations, 2016.
3. To approve Mid-Term Review of ARR for FY 2019-20 to FY 2020-21 as per GERC
(MYT) Regulations 2016.
4. To consider approved True up parameters & Multi-Year ARR of GSECL, GETCO
and SLDC while finalizing Tariff of the Petitioner.
5. To approve the terms and conditions of Tariff for FY 2019-20 and various other
matters as proposed in this petition and proposed changes therein.
6. Pass suitable orders for implementation of Tariff Proposal for FY 2019-20 for
making it applicable from 1st April, 2019 onwards.
7. To grant any other relief as the Commission may consider appropriate.
8. The Petitioner craves leave of the Commission to allow further submissions,
addition and alteration to this Petition as may be necessary from time to time.
9. Pass any other order as the Commission may deem fit and appropriate under the
circumstances of the case and in the interest of justice.

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3 Brief outline of objections raised, response from

UGVCL and the Commission’s View

3.1 Stakeholders’ suggestions / objections, Petitioner’s

Response and Commission’s observation
In response to the public notice, inviting objections/ suggestions of the stakeholders
on the petitions filed by DISCOMs for truing up of FY 2017-18, Mid-Term Review of FY
2019-20 and FY 2020-21 and determination of tariff for FY 2019-20, a number of
consumers/ consumer organisations filed their objections/ suggestions within the
prescribed timeline. Some of these objectors participated in the public hearing also.
Further, some of the objections are general in nature and some are specific to the
proposals submitted by the petitioner. It is also noted that many of the objections/
suggestions are common to all the four DISCOMs and some are specific to concerned
DISCOM. The objections/ suggestions connected with the current petition are
segregated into two groups viz. common to all DISCOMs and specific to concerned
DISCOM. The Commission, has, therefore, addressed the objections/ suggestions
issue-wise rather than objector-wise.

3.2 Suggestions/Objections Common to all DISCOMs

1. Supply of water to the Bricks manufacturers should be removed from
Agriculture.
The Objector stated that supply of water to the Bricks manufacturers under the head
of Agriculture category should be removed.

Response of the Petitioners:

Supply to Bricks Manufactures by an Agriculture consumer is an optional facility and

an Ag consumer can opt for it if he desires. This is not a compulsory requirement.

Commission’s view:

The Commission has noted the response of the Petitioners which is self explanatory.

2. Quantum and Quality of supply to Agriculture and Supply Hours to

Agriculture

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The objector sought information on quantum of power supply given to Agriculture

Consumers and hours of such power supply. Issue of quality power supply to
Agriculture Consumers is also raised.

Response of the Petitioners:

Petitioners submitted that minimum Average eight hours power supply is provided to
agriculture sector. Further, a policy related to power supply to agriculture sector has
also been formulated by Gujarat Urja Vikas Nigam Ltd as per guidelines from GoG for
uniform power supply to agriculture sector in the State and DISCOMs have been
implementing the same by ensuring minimum average eight hours 3 phase power
supply to agriculture sector. Moreover, during cropping seasons as per the requirement
in order to save standing crops, more than 8 hours of power supply is also provided to
agriculture sector. In case power supply to Ag Sector is given less than 8hrs during the
day due to technical constraints related issues in that case the shortfall in power supply
of previous day is compensated during the subsequent period. It is the endeavor of the
Distribution Companies to provide the quality power and best possible services well
within the time limits specified in Regulations.

Commission’s view:

The Commission has always emphasised on providing quality power supply and is of
view that Petitioners should take every measure to deliver quality power supply.

3. Un-realistic Projections of demand

The Objector stated that projections are un-realistic for estimating demand of
consumers.

Response of the Petitioners:

Petitioners submitted that it estimated Sales, No. of consumers and Connected load
based on the growth rates in the past and sale to agriculture metered category are
projected based on methodology done in past. This has been done as per Tariff
Regulation notified by the Commission

Commission’s view:

The Commission has carried out the Mid-Term Review after due diligence and
prudence check.

4. Bad Debt accounts:

The objector sought information on bad and doubtful debts written off.
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Response of the Petitioners:

Petitioners submitted that every Year, certain billing amount of some consumers are
ascertained to be non recoverable and is charged in P&L of the Company under the
head of other debits for the respective year.

Commission’s view:

The Commission has approved the actual Bad and Doubtful Debts written off in
accordance with the provision of the GERC (MYT) Regulations, 2016.

5. Overload Feeders:
The objector sought information on overloaded feeders.

Response of the Petitioners:

Loading on any of the feeder is highly dynamic phenomena. However, feeders having
either more length or found to be overloaded on sustained basis are bifurcated on
priority. Information on Nos. of Feeders bifurcated during last three years and proposed
to be bifurcated during rest of the period of 2018-19 is provided along with expenditure
details.

Commission’s view:

The Commission is of the view that adequate planning is to be carried out for load
management in accordance with provisions of the GERC Distribution Code, 2004, so
that overload condition of the feeders is avoided.

6. Reduction in HP Based tariff and special sub-category for AG

consumers
The Objector requested for reduction of tariff for HP based tariff category consumers.
It is also requested for introduction of new special sub category for Agriculture
Consumers and/ or grant relief to the farmers, who accept in a group of entire feeder,
the metered tariff.

Response of the Petitioners:

The National Tariff Policy mentions to have rationalization of tariff of various consumer
categories such that it is more aligned to the cost of supply and in a band of +/-20 %
to the average cost of supply. In order to ensure uniform tariff rates for all four State
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Owned DISCOMs, differential bulk supply tariff mechanism is in place. Average

recovery from agriculture category consumers is much less than average cost of
supply.

The present tariff of agriculture is highly subsidized and hence further categorization is
not appropriate.

Commission’s view:

Agriculture consumers category is a highly subsidized category. The Commission

while determining tariff emphasizes to maintain balance between subsidized category
and subsidizing category.

7. Concessional tariff to the micro-irrigation system

The Objector requested for introduction of a special concessional tariff rate for
individual farmer adopting Micro irrigation systems.

Response of the Petitioners:

Irrigation to agricultural field through micro/drip irrigation system requires less energy
consumption compared with normal mode of irrigation. Thus such agriculture
consumers are automatically benefitted. Giving benefit to one class of consumer will
result into increase in tariff of other class of consumers.

Commission’s view:

The Commission noted the response of the Petitioners which is self-explanatory.

8. Abolition of Tatkal Scheme:

The Objector requested for abolition of Tatkal Scheme.

Response of the Petitioners:

The Petitioner had filed Petition No. 1087/2011 on the said issue and the Commission
has disposed of the petition.

Commission’s view:

The Commission has no role to play in this matter as the scheme is introduced by the
State Government.

9. Discontinuation of Energy Efficient Pump Set scheme

The Objector requested to restart Energy Efficient Pump Set scheme.

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Response of the Petitioners:

Efficient utitization of electrical energy helps in less energy consumption for the same
quantum of work. This phenomenon is equally applicable to the agricultural
consumers. A demonstrative project was undertaken by replacing old pump sets with
efficient pump sets. If the metered agricultural consumer installs energy efficient pump
set, energy consumption as well as energy bill can be reduced.

Commission’s view:

The Energy Efficient Pump Set scheme is in place in the area of PGVCL under
Demand Side Management Programme was introduced by PGVCL. It is experienced
that consumers are not coming forward to avail the benefits of this scheme. The
objector being a consumers organisation should make the consumers aware about
benefits of the said scheme by opting it.

10. Clarification in LTP-V Tariff Category:

The Objector requested for clarification in LTP – V Tariff Category.

Response of the Petitioners:

LTP-V tariff category is to incentivize use of surface water sources such as river, canal,
dam etc. and supplying water directly to the field of farmers for irrigation only. Further
this is to motivate the farmers for utilization of surface water and thereby to promote
energy and water conservation particularly for the consumers in the command area of
Sardar Sarovar project area and such other mini irrigation system. Mainly such projects
or system requires 24 hours power supply and therefore a separate tariff category is
provided. Since specific tariff is provided for surface water irrigation, the same cannot
be extended for filling up the ‘houze’ etc. prepared in farm for water collection

Commission’s view:

Th response of the Petitioners is self explanatory.

11. Introduction of new Tariff Categories

The Objector suggested to introduce new tariff categories for luxury purpose,
amusement purpose and entertainment purpose.

Response of the Petitioners:

No response is submitted by the Petitioners.

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Commission’s view:

The Commission determines the tariff in accordance with provisions of the Electricity
Act, 2003 which provides that no undue preferences to any consumer of electricity will
be shown while determining the tariff.

12. Not to approve FPPPA

The Objector requested not to allow any interim extra charges by way of FPPPA in
between the year.

Response of the Petitioners:

The basic nature of FPPPA/PPPA is 'adjustment' related to power purchase cost i.e.
pass through of increase or decrease, as the case may be, in the power purchase cost
over the base power purchase cost. The PPPA charge is being levied on the consumer
categories on account of the change in the cost of power purchase, which comprises
almost 85 to 93% of the Distribution Licensee's Aggregate Revenue Requirement. Any
expense pertaining to the regulated business of the Distribution Licensee has to be
recovered from all consumers in some manner; therefore the PPPA charges are
recovered in the form of an incremental energy charge (Rs/kwh) recovered as per
formulae approved by the Commission.

Commission’s view:

The cost of Power Purchase varies with variation in the cost of coal freight and other
energy sources which is recovered through FPPPA charges. If such FPPPA revisions
are not carried out on quarterly basis, huge burden will get imposed on the consumers
at the time of truing up.

13. Restrict supply of electricity to non-productive activity

The power supply should be restricted for day and night cricket matches and other non
productive activities, until all pending Agri. connections are released.

Response of the Petitioners:

No response is furnished by Petitioners.

Commission’s view:

The DISCOMs cannot differentiate amongst the class of consumers.

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14. Transmission and Distribution losses

The Objector stated that Distribution Loss and Transmission should be restricted up to
9% and 1.0% respectively. T & D Loss to be restricted up to 10.00 % and above that
no loss to be passed on the consumers.

Distribution Losses are being controlled by

(i) Reducing the Supply Hours from 16 To 8

(ii) Sufficient Rain Fall

Feeder Management system has totally failed. Post of Feeder Managers should be
totally free from the routine work. No sincere efforts have been made towards reduction
of Technical losses.

Response of the Petitioners:

The Commission has approved distribution loss trajectory for the entire MYT control
period from FY 2016-17 to FY 7020-71. Except PGVCL, other three DISCOMs have
projected same distribution losses as approved by the Commission in MYT Order
dated 31.03.2017, while PGVCL has projected lower distribution losses in the Mid-
Term Review than approved in the MYT Order dated 31.03.2017. Distribution losses
being controllable factor, the Petitioners have given appropriate treatment to the
deviation from approved loss in the true up petition for FY 2017-18. It is also submitted
that as Transmission losses are beyond the control of Distribution Company, the actual
transmission losses are considered by the Petitioners.

Commission’s view:

While appreciating the efforts made by the Petitioners in achieving loss reduction up
to target level, the Commission is of the view that sustained and concerted efforts
should be continued to further reduce the losses than the approved in the MYT Order
dated 31.03.2017.
15. Power purchase ceiling rate
The ceiling rate of power purchase during the year has to be decided along with Tariff.

Response of the Petitioners:

No response is furnished.

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Commission’s view:

The Commission approves base power purchase cost. Any variation in power
purchase cost due to variation in cost of coal/ other energy sources is recovered
through FPPPA charges to avoid tariff burden at the time of truing up. However, at this
time of true up, the Commission examines the purchase cost on prudent basis and as
per Regulations.

16. Remove the row of Interest on Working Capital from ARR Table and
consider Return on Equity at 12%
The Interest on working Capital is not grantable and the row to be removed from ARR
format. It is also stated that the ROE at 14% is too high. It should be reconsidered and
reduced to 12%.

Response of the Petitioners:

In true up petition for FY 2017-18, no claim for Interest on working capital is proposed
and RoE is worked out as per the GERC (MYT) Regulations, 2016.

Commission’s view:

As the Petitioners have huge amount of Security Deposit with them, which they use for
Working Capital requirement the Working Capital requirement works out to be negative
and accordingly, interest on Working Capital is not calimed by the Petitioners and
approved as NIL by the Commission. Further, RoE is approved as per provisions of
the GERC (MYT) Regulations, 2016.

17. High projection of Power Purchase Cost

The projection of power purchase cost is too high and Merit Order not being
implemented and monitored.

Response of the Petitioners:

No response is furnished.

Commission’s view:

The Commission has after due diligence approved the Power Purchase Cost for FY
2019-20 and 2020-21 considering actual fixed and variable cost of FY 2017-18. The
issue is discussed in the relevant section of Chapter 5 of this Order.

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18. Agriculture Subsidy

The Budgetary provision for Agriculture Subsidy is stagnant at Rs. 1100/- Crores from
years and not increased to match with Nos. of Agri. Consumers in the State. It must
be at least Rs. 5000/- Crores.

Response of the Petitioners:

No response is furnished.

Commission’s view:

Subsidy to agriculture consumers is provided by Government of Gujarat and not

decided by the Commission.

19. Large number of pending meters for replacement

There are still 1.50 Lacs meters under non-woring conditions, Detailed status report is
required to be submitted with reasons.

Response of the Petitioners:

Petitioners have submitted status of meters replaced.

Commission’s view:

The Commission has already provided directive to Distribution Utilities to adhere to the
time lines specified in the GERC (SoP) Regulations, 2005 for replacement of faulty
meters.

20. Abolish Fixed Charges for Agriculture and Residential consumers

The Fixed charges on Agriculture and Residential consumers is required to be
abolished totally.

Response of the Petitioners:

It is a basic commercial principle for any organization to recover its fixed costs through
recovery of fixed charges. In case of DISCOMs even with the proposed tariff, only 36
% fixed cost is recovered through fixed charges. Therefore it is not possible for
DISCOMs to abolish fixed charges

Commission’s view:

The Commission noted the response of the Petitioners and agrees with the response.

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21. Directives of the Commission not fulfilled

The directives of the Commission are not complied as feeder bifurcation work is
unsatisfactory, distribution transformer centre review work is reduced, conductor
replacement work is reduced, HVDS is not satisfactory and erection work under
KHUSHY scheme is poor.

Response of the Petitioners:

The compliance of directive is submitted to the Commission from time to time. Actual
expenditure incurred under various schemes vis-à-vis approved by the Commission is
provided in the petition.

Commission’s view:

The compliance of directives is discussed in detail in Chapter 7 of this Order where the
Commission’s observation on the compliance is also deliberated in the said Chapter
7.

22. Distribution losses on JGY feeders

The distribution losses on JGY feeders remain uncontrolled and a separate status
report is required for work done, expenses and output, results.

Response of the Petitioners:

Petitioners have furnished various activities carried out for loss reduction in JGY
feeders.

Commission’s view:

The Commission is of the view that thorough energy audit need to be carried out on
JGY feeders having higher distribution losses as per the directives issued in previous
tariff orders and as discussed during previous meetings of Co-ordination Forum.

23. Distribution Transformer Failure rate

The Distribution Transformer Failure rate is not mentioned.

Response of the Petitioners:

Distribution Transformer Failure Rate is submitted.

Commission’s view:

DISCOMs are furnishing quarterly data on Distribution Transformer failure as a part of

reports on SoP which are available on the Commission’s website.

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24. Information on agriculture connections to be released under Normal

scheme and Dark Zone scheme
The projections are not made for agriculture connections to be released under Normal
scheme and Dark Zone area scheme.

Response of the Petitioners:

Releasing of connections is an on-going task and every year agriculture connections

are released under various schemes like Normal, Tatkal, etc. Information on agriculture
connections released is provided.

Commission’s view:

The response of the Petitioners is self explanatory.

25. Incomplete Consumer Charter

The Consumer Charter related to agriculture consumers does not specify maximum
waiting period after registration of agriculture connection application.

Response of the Petitioners:

The consumer charter is prepared for all categories of consumers including agriculture
consumers.

Commission’s view:

The Commission noted the objection of the Objector and the response of the
Petitioners.

26. Demand for establishing new administrative offices

The demand for creation of new administrative offices is pending since long.

Response of the Petitioners:

Theadministrative offices are created for convenience of administration for the

Petitioners as well as the consumers. Petitioners are creating new offices as per the
requirement.

Commission’s view:

The Commission noted the objection of the Objector and response of the Petitioners..

27. To show FPPPA & PPA charges separately

The Objector requested to separate FPPPA charges and mention fuel Charges and
Power Purchase charges separately.
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Response of the Petitioners:

The Commission has approved the FPPPA formula through its order dated 29.10.2013
and accordingly any incremental power purchase cost compared to base year power
purchase cost would be a Power Purchase Price Adjustment only.

Commission’s view:

The Commission noted the response of the Petitioners and is in agreement with the
same.

28. Prompt Payment Discount

The prompt payment discount @1% is not implemented by DISCOMs and the word
“may be” be replaced by “must be”.

Response of the Petitioners:

The expenses of prompt payment discount is to be borne by the DISCOMs and

considering present bank interest rate and liquidity of DISCOMs, it is not possible for
DISCOMs to offer such discount for early payment of bills just three days before the
end of grace period of ten days and therefore, it should be left to the discretion of
DISCOMs.

Commission’s view:

The Commission, after careful consideration, has decided to delete the provision of
Prompt Payment Discount from the Tariff Schedule to avoid confusion.

29. Not to increase Tariff

The objector requested not to increase electricity tariff.

Response of the Petitioner:

The petition is filed for Truing up of FY 2017-18, Mid-Term Review of FY 2019-20 and
FY 2020-21 and Determination of Tariff for FY 2019-20. No tariff increase has been
sought.

Commission’s view:

The Commission, after due diligence and prudence check of financials and submission
of Petitioners, has made certain decisions which are deliberated in Chapter 9 of this
Order.

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30. Tariff of LTP – V and HTP – V category

The objector requested to keep the Tariff for HTP V/LTP V at par with normal
Agriculture Tariff.

Response of the Petitioners:

The consumers of LTP-V/HTP-V category are provided with 24 hours power supply
while agriculture consumers are being provided 8 hours power supply on rotation
basis. As the hours of power supply are different for these categories of consumers, it
is not viable to keep tariff rate same.

Commission’s view:

The issue is discussed in detail in Chapter 10 of this Order.

31. One tariff for all Agriculture Consumers

The objector stated that there should be only one tariff for all the Agriculture consumers

Response of the Petitioners:

The tariff rates are decided by the Commission. Prior to year 2001, agriculture
consumers were supplied power without meter. After the year 2001, power supply to
agriculture consumers is supplied with meter and accordingly, electricity bill is prepared
based on readings. Agriculture consumers who are supplied power without meters are
charged based on their contracted demand and such consumers are considered under
A-1 category.

Further, agriculture connections are provided under Normal scheme and Tatkal
scheme. Estimates provided under Normal scheme and Tatkal scheme are also
different and tariff rates for agriculture connections under Normal scheme and Tatkal
scheme are different as decided by the Commission. Agriculture connections provided
under Normal scheme are considered under A-2 category while agriculture
connections provided under Tatkal scheme are considered under A-3 category.
Further, the consumers under Tatkal scheme shall be eligible for normal metered tariff
on completion of five years period from the date of commencement of supply.

Commission’s view:

The Commission has noted the objection of the Objector and the response of the
Petitioners.

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32. Reduction in flat rate tariff for agriculture consumers

The Objector requested to reduce flat rate tariff for agriculture consumers to Rs.
500/HP/year.

Response of the Petitioners:

As per Tariff Policy, tariff should be within range of +/- 20% of cost to serve and
therefore, it is not viable to provide any more concession to agriculture consumers.

Commission’s view:

The Commission noted the response of the Petitioners which is self-explanatory.

33. Special dispensation in the tariff to sick industrial units

Sick industrial units should be provided with special dispensation in the tariff at
maximum Rs. 4.40 per unit (including all charges but not limited to demand charges,
Time of Use Charge (TOU), Fuel Surcharge, Energy Charges, Meter Charges, P.F.
adjustment/rebate charges, Security Deposit for additional Load etc.). Sick units should
also be given relief to pay cross subsidy (at present it is Rs. 2.51/unit)

Response of the Petitioners:

Pursuant to letter dated 16.1.2019 & 31.1.2019 from Energy & Petrochemicals Dept.,
Govt of Gujarat, the Company has filed a supplementary submission before the
Commission for deciding flat rate tariff in-between Rs 4.40 per Unit and Cost to Serve
for viable Sick industry provided their ARR is protected.

Commission’s view:
This issue is being dealt with separately by the Commission in the petition filed by the
Objector.

34. Separate Tariff for each Distribution Company

Determination of separate tariff for each of the State owned Distribution Utility
considering different distribution loss of four State Owned Distribution Utilities.

Response of the Petitioners:

Uniform retail supply tariff for all four DISCOMs (Unbundled entities of erstwhile GEB)
has been envisaged so that consumer in the similar categories in the State could have

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similar tariff and there may not be any discrimination, which is also one of the objectives
of the EA 2003.
The four Distribution Companies are incorporated on the basis of zonal configuration.
Since the 80% - 90% of the total cost incurred by DISCOMs is for Power Purchase,
the same plays a major role in determining the Annual Revenue Requirement as well
as Gap / (Surplus) for the DISCOM for a particular year. Since the consumer profile
and consumption profiles are different in the four Distribution Companies, the revenue
earning capabilities of each of the DISCOMs differs resulting in different Annual
Revenue Requirement.
Therefore, it is necessary to build a mechanism to bring them to a level playing field.
This is achieved through differential Bulk Supply tariff (BST) to each of the DISCOMs
which is approved in the MYT Order. In this way, it becomes possible to ensure uniform
retail consumer tariffs in the four DISCOMS. Moreover, performance of all the
Distribution Companies is monitored by the Commission and accordingly Distributions
Loss is approved by the Commission.
Commission’s view:
Response of the Petitioners is self-explanatory.

35. Additional higher consumption slab for Residential Consumers

Introduction of higher consumption slab of above 400 units per month for residential
consumers and to remove existing slab of 200 -250 which has tariff difference of 10
Paise /unit only.

Response of the Petitioners:

Tariff structure of the different States are designed keeping in mind the different social,
economic, technical, demographic and other relevant parameters specific to the state.
The Commission has been time to time reviewing the Tariff structure and rationalizing
the tariff. However, any change in the tariff structure may be revenue neutral.

Commission’s view:
The Commission has taken appropriate decision regarding this in the Tariff Philosophy
chapter of this Order.

36. Non-submission of performance parameters

Only financial performance has been submitted by the Petitioners while other
performance parameters are not submitted.
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Response of the Petitioners:

Petitioners have submitted requisite performance details.

Commission’s view:
The Commission timely reviews performance of Petitioners through data submitted as
part of SoP Reports and RIMs reports and necessary directives are also issued in case
performance is not found satisfactory. Further, during meetings of State Advisory
Committee and State Co-Ordination Forum, such performance parameters are
deliberated. Minutes of the said Meetings along with SoP and RIMs reports are
available on the Commission’s website.

37. Review of Performance during 2017-18

Revenue Gap and distribution losses of PGVCL out of four Petitioners are highest
during 2017-18. It is requested to not to approve any parameter which is above the
limit of approved parameters.

Response of the Petitioner:

Various steps are taken for reduction of distribution losses and all efforts are being
made to achieve further reduction in distribution losses. Petitioner endeavours to
achieve the loss reduction trajectory as approved by the Commission.

Commission’s view:
The Commission appreciates the efforts being made by the Petitioners in achieving
the target of loss reduction. However, loss reduction activity being continuous,
sustained and concerted efforts should be made to reduce the losses in coming years
also.

All the four Distribution Companies are catering to different mix of consumers having
different characteristics of geographical area. Comparing losses of one DISCOM with
another is not appropriate. Instead, comparison of current year’s performance in loss
reduction activities with that of previous years is more appropriate.

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38. 30% increase in employee cost during FY 2017-18

Inspite of increase of 30% in the employee cost no improvement is seen in the quality
of power and services to the consumers. The Commission should direct the Petitioners
to reduce their cost by reducing manpower.

Response of the Petitioners:

Employee expenses comprise of salaries, dearness allowance, bonus, terminal
benefits in the form of gratuity and leave encashment and staff welfare expenses. The
increase in employee cost is purely statutory increase on the basis of the guidelines
issued by competent authorities like the State Government. Hence, the entire
expenditure is a legitimate expenditure and variation is purely beyond its control.

Commission’s view:
The Commission in the true up orders of previous year did not consider provision made
for salary increase on account of 7th Pay Commission Order and decided to consider
Pay revision at the time of actual pay out. Accordingly, the Commission has considered
the impact of actual pay out of 7th Pay Commission Order.

39. Increase in Power purchase cost:

The Petitioners have procured power at higher rate due to non-availability of power
from the IPPs.

Response of the Petitioners:

The power is procured from different sources during FY 2017-18 following Merit Order
Principle only. The variation in the actual viz-a-viz approved power purchase expenses
is on account of various factors such as variation in the fuel cost, variation in the power
purchase mix due to operation of merit order principle and availability of generating
stations, variation in the quantum of power purchased due to variation in demand
during the year as well as variation in the T& D losses in the system.

Commission’s view:
The response of the Petitioner is self-explanatory. However, a separate study on
principles of Merit Order Despatch was conducted and no discrepancies were found in
MoD. The said report was made available to the consumers.

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40. Over recovery of FPPPA

The Petitioners are collecting Rs. 990 Crores from consumers by increasing power
purchase cost by 12 Paise and FPPPA by 14 Paise per unit. The collection of additional
Rs. 990 Crores amounts to increase in tariff by 11 per cent per unit. The Objector
requested to merge Rs. 1.00 of FPPPA charges into tariff slabs and revise the base
FPPPA.

Response of the Petitioners:

The basic nature of FPPPA/PPPA is 'adjustment' related to power purchase cost i.e.
pass through of increase or decrease, as the case may be, in the power purchase cost
over the base power purchase cost. The PPPA charge is being levied on account of
change in the cost of power purchase, which comprises almost 85% to 93% of the
Distribution Licensee's Aggregate Revenue Requirement. Any expense pertaining to
the regulated business of the Distribution Licensee has to be recovered from all
consumers; therefore, the PPPA charges are recovered in the form of an incremental
energy charge (Rs/kwh) recovered as per formulae approved by the Commission and
as per directives of the Commission.

Commission’s view:
As explained by the Petitioners, incremental power purchase cost over the base power
purchase cost is to be recovered through FPPPA charges over and above the base
FPPPA charges (i.e. Rs. 1.43/unit for FY 2017-18). Detailed clarification has been
provided in past years Tariff Orders and also in the Chapter 8 of this Order.

41. Revenue Gap of four DISCOMs for 2019-20

The Petitioners have submitted a deficit of nearly Rs. 1677 Crores to be met from
subsidy receivable from Government. The Petitioners have not demanded any
increase in tariff for any category of consumers. But there is indirect increase of Rs.
0.11 per unit by increasing base price of PPC and FPPPA charges, which is not
justified.

Response of the Petitioners:

In the True up Order for FY 2016-17 dated 31st March, 2018, the Commission has
considered the base power purchase cost at Rs. 4.72/unit and base FPPPA at Rs.

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1.49/unit. As per approved FPPPA formula, any increase in power purchase cost
during the year over and above base power purchase cost of Rs. 4.27/unit is to be
recovered through FPPPA over and above base FPPPA of Rs. 1.49/unit on quarterly
basis. As per projected ARR for FY 2019-20, the weighted average power purchase
cost is worked out to Rs.4.34/unit as against earlier approved base power purchase
cost of Rs. 4.22/unit. Thus, the incremental power purchase cost of Rs. 0.12/unit for
FY 2019-20 (i.e. Rs. 4.34 - 4.22) will be recovered through FPPPA over and above
base FPPPA of Rs. 1.49/unit. Therefore, estimated revenue from FPPPA for FY 2019-
20 is considered at Rs. 1.63/unit for FY 2019-20 (i.e. grossing up by approved losses)
and accordingly revenue gap has been worked out.

Commissions’ view:
As explained by the Petitioners, incremental power purchase cost over the base power
purchase cost is to be recovered through FPPPA charges over and above the base
FPPPA charges (i.e. Rs. 1.49/unit for FY 2017-18). Detailed clarification has been
provided in past years Tariff Orders and also in the Chapter 8 of this Order.

42. Reduction in Electricity Duty in Gujarat:

The Objector has requested for rationalization of Electricity Duty which is highest in
Gujarat for few categories. It is requested to reduce the Electricity Duty for Residential,
Commercial consumers by 5% each and for HT industrial consumers by 2.5%.

Response of the Petitioners:

Electricity Duty is being levied as per the provisions of the Electricity Duty Act.

Commission’s view:
Electricity Duty is the subject matter of the State Government.

43. Submission of Average Power Purchase Cost

The Petitioner should submit the "Average Power Purchase Cost" (APPC) for the year
2017-18 applicable to the solar project commissioned in FY 2018- 19 along with
detailed calculation.
Response of the Petitioners:

The issue is not relevant to the present petition.

Commission’s view:

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The Petitioner’s response is self-explanatory.

44. Submission of details on source wise planning to purchase power from

renewable sources
The Petitioner should submit the detail source wise planning to purchase power from
renewable energy source to comply with the relevant Regulations.

Response of the Petitioners:

The issue is not relevant to the present petition.

Commission’s view:

The Commission is of view that the issue of source wise planning to purchase power
from renewable sources of energy to meet RPO obligation is very much relevant to this
petition and the Petitioners should have responded in this regard. In this petition, the
Petitioners have furnished source wise planning of purchase of power for FY 2019-20
and FY 2020-21 in the Power Purchase Cost section. The Commission has considered
quantity of purchase of power from renewable sources in accordance with RPO targets
fixed by the Commission.

45. Encourage Investment in the State to achieve the Renewable energy

target
The State Government can notify a policy to encourage investment in the State by
allowing setting up of generating plants, including from renewable energy sources out
of which a maximum of 35% of the installed capacity can be procured by the
Distribution Licensees of that State for which the tariff may be determined under
Section 62 of the Electricity Act, 2003.

Response of the Petitioners:

The issue is not relevant to the present petition.

Commission’s view:

It is prerogative of the State Government to notify policies to encourage investment in

renewable energy sources.

46. To allow 100% of contract demand for rooftop solar for HT consumers
The objector requested to allow 100 % of capacity for rooftop Solar with reference to
contract demand for HT consumers, out of total generation 25 to 35 % generation may

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be retained by DISCOM to meet its RPO Target at a Preferential tariff or may be

decided by the Commission.

Response of the Petitioners:

The issue is not relevant to the present petition.

Commissions’ view:

The response of the Petitioner is self-explanatory.

47. Procure power from renewable energy sources through competitive

bidding
State shall endeavor to procure power from renewable energy sources through
competitive bidding to keep the tariff low, except from the waste to energy plants.

Response of the Petitioners:

The issue is not relevant to the present petition.

Commissions’ view:

GUVNL has already started procuring renewable energy power through competitive
bidding for four State Owned DISCOMs.

48. To Allow RESCO in rooftop Solar

Allow RESCO in rooftop solar.

Response of the Petitioners:

The issue is not relevant to the present petition.,

Commissions’ view:

Not to allow RESCO model in GERC (Net Metering Rooftop Solar PV Grid Interactive
Systems) Regulations, 2016 was a decision taken after deliberations and inviting
comments/ suggestion from the stakeholders. However, the Commission is of the view
that this matter is not a part of this Tariff petition.

49. Innovative Ideas

The Commission should direct the Petitioners to come with some innovative ideas in
the national interest to protect environment as well as for the benefit of consumers.

Response of the Petitioners:

This issue is not relevant to the present petition.

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Commissions’ view:

The response of the Petitioner is self-explanatory.

50. To install Rooftop solar at Client’s premises on lease basis.

The objector suggested that Solar EPC companies install rooftop solar at client's
premises on lease basis and DISCOM will collect EMI to reimburse to EPC Company
with certain service charge. The Commission may issue the guideline in this regard

Response of the Petitioners:

The issue is not relevant to the present petition.,

Commissions’ view:

The Commission noted the objection of the Objector. The Commission is of the view
that this matter may be dealt separately and not as a part of this Tariff petition.

51. GUVNL to remain present during hearing on Tariff Petitions

The GUVNL representatives should remain present during hearing on Tariff Petitions.

Response of the Petitioners:

GUVNL is co-petitioner of the petitions filed.

Commission’s view:

GUVNL representatives, as a Co-petitioner or otherwise, have always remained

present during the hearing to satisfy the queries of the stakeholders.

52. Power Purchase

The Petitioners have procured more power than demand.

Response of the Petitioners:

Power purchase on behalf of all four Discoms is undertaken by GUVNL on the basis
of requirement of each Discom. In the process, the surplus power is sold by GUVNL
on behalf of DISCOMs and proceeds from the sale are passed on to Discom which
ultimately pass on to general mass of consumers.

Commission’s view:

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For the Petitioners to procure power only as per demand of the consumers is difficult
considering the fact that it is not possible to predict exact demand of the consumers.
Further, the Petitioners have to supply power 24x7x365 to consumers as per
provisions of the Electricity Act, 2003. The revenue from sale of power to GUVNL is
reduced from the power purchase cost and thus consumers are given benefit out of
the revenue earned from sale of power by GUVNL.

53. Subsidies not accounted in the Annual Accounts

The Agriculture tariff subsidies, FPPPA and water works subsidies are not accounted
in Annual Financial Reports. This great financial irregularity need to be corrected.
Response of the Petitioners:

As per the tariff order of the Commission, FPPPA charge is a part of tariff. In case of
Agricultural consumers, the FPPPA charges payable by the Agriculture consumers is
not recovered from the consumers but it is being compensated by State Government.
Revenue received from Agriculture consumers is mentioned in the Annual Accounts of
the Petitioners for FY 2017-18 which is inclusive of FPPPA subsidy and the subsidy
for tariff compensation from Government for FY 2017-18, as tabulated below;

Subsidy for tariff

FPPPA subsidy (Rs.
DISCOM Note No. compensation (Rs.
Crore)
Crore)
DGVCL 49 75.16 42.15
PGVCL 29 672.87 442.31
MGVCL 30 114.38 48.52
UGVCL 29 837.58 602.79

Similarly, Subsidy received from the State Government towards the Water Works
connections is also mentioned in the Annual Accounts as shown below:

Subsidy towards Water Works

DISCOM Note No.
Connections (Rs. Crore)
DGVCL 49 37.21
PGVCL 29 181.52
MGVCL 30 46.80
UGVCL 29 134.46

It may be noted that FPPPA subsidy received from State Government and subsidy for
the Water Works connections have been duly considered in the Revenue from Sale of
Power for respective category of consumers both in Annual Accounts of the Company
and also in the True up proposal.

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Commission’s view:
The response of the Petitioners is self-explanatory.

54. Basis of charging GETCO and PGCIL charges

The Objector requested the Commission to direct GUVNL to submit its basis for
charging PGCIL and GETCO charges from individual Petitioner.

Response of the Petitioners:

PGCIL and POSOCO charges are applicable in accordance with Order / Regulations
of Hon'ble CERC. PGCIL and GETCO charges and losses both are separate matter
and governed as per the Order/ Regulations of Hon'ble CERC and GERC respectively
and therefore appropriate treatment is given for the losses and charges.

Commission’s view:

GETCO losses are considered to work out total energy requirement and thus, per unit
power purchase cost to determine gain/ loss on account of distribution loss. However,
PGCIL and GETCO Charges are part of power purchase cost, considering distribution
utilities as beneficiaries of State and National transmission system, and thus part of
ARR to determine gap/ surplus of the truing up year.

55. Higher Return on Equity

The Objector objected to give Return on Equity @ 14% due to non-audited assets of
the Petitioners.

Response of the Petitioners:

Return on Equity is claimed as per the relevant provisions of MYT Regulations and as
explained in the petition, for assessing actual return on equity for FY 2017-18,
Company has considered the opening balance of equity of FY 2017-18 equivalent to
the closing balance of equity of FY 2016-17 as approved by the Commission in the
True up order dated 31st March, 2018 and normative addition during FY 2017-18
based on actual capitalization

Commission’s view:

The Commission approves normative equity addition at 30% of approved capitalization

and allows Return on Equity at the rate of 14%. Further, as per Regulation 33 of the

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GERC (MYT) Regulations, 2016, where actual equity employed is more than 30% of
capital cost approved by the Commission, the amount of equity for the purpose of tariff
is limited to 30% and the balance is considered as loan, thereby capping the equity at
30% of the capital cost approved by the Commission.

56. Disclosure of Total Income-

The objector has sought for disclosure of total income by the petitioners recovered
from the consumers in accordance with various Regulations notified by the
Commission and revenue earned from FPPPA Charges.

Response of the Petitioners:

As per Accounting practice, revenue accounted in the Annual Accounts includes

revenue from sale of power to GUVNL (surplus sale) and DSM charges, besides
revenue from sale of power to retail consumer categories. Whereas in the ARR
petition, net power purchase cost is shown i.e. after reducing amount towards sale of
surplus power to GUVNL from total power purchase cost, as per requirement of ARR
mechanism. Therefore the amounts of revenue in the annual accounts and in the true-
up petition cannot be same being requirement of different accounting treatment in the
ARR and Annual Accounts. Revenue from sale of Power includes revenue through
FPPPA charges, revenue from temporary connections also. Further, the head "Other
Income" is classified under the head of non-tariff income in the petition and the same
has been reduced from total ARR rather than including it in the revenue. So the total
income is disclosed in the petition but presentation is different as per Accounting
Practice and requirement as per MYT Regulations.

Commission’s view:
During prudence check of the submission from licensee, whenever required the
Commission asks licensee to provide additional details and clarification and all such
additional information received from licensee in tariff determination exercise are placed
on the Commissions’ website and made it available to all the stakeholders. Non-Tariff
Income is reduced from ARR to work out at Revenue Gap/ Surplus while carrying out
truing up exercise so that consumers get the benefit of the Non-Tariff Income.

57. Higher rates of temporary connection

The tariff rates for temporary connections are higher than tariff rates for normal supply
of electricity and income from such temporary connections is not disclosed by the
petitioners.
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Response of the Petitioners:

Being temporary by nature, the tariff for “Temporary Connection” should always be
higher than the tariff for permanent category consumers.

Commission’s view:
The response of the Petitioners is self-explanatory.

58. Introduction of LTMD Tariff above 6 kW in all categories

The Objector requested either to create new demand based NRGP/RGP/GLP tariff
(Both for Rural and General area) for consumers having connected load from 1 kW to
15 kW (LTMD 1) or LTMD tariff should be applicable to all small consumers having
load from 6 kW and above in all categories including Residential /Commercial/
Industrial and GLP category.

Response of the Petitioners:

This is the suggestion to the Commission and any modification to be made by the
Commission should be revenue neutral to the Company.

Commission’s view:

The Commission has dealt with this issue appropriately in the tariff Schedule attached
to this order.

59. High loss making feeders

The Objector sought the list of high loss making feeders with plan of action and
improvement in reducing the losses. The objector requested the Commission to
differentiate between Tariff and Tariff schedule.

Response of the Petitioners:

Petitioners submitted that they have achieved a significant reduction in distribution

losses, during recent years. These efforts shall continue and will be enhanced.
However, loss reduction is a slow process and becomes increasingly difficult as the
loss level goes down. Distribution Loss of Agriculture category is highly influenced by
the amount and spells of rainfall etc. particularly during monsoon season. However,
with the continuous efforts and expeditious release of new connections, the loss of
Agriculture category has also reduced.
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Commission’s view:

While appreciating the efforts of the Petitioners to achieve loss reduction target, the
Commission is of view as part of compliance of directives, where Petitioners have been
submitting identified high loss making JGY feeders and steps to reduce losses of such
feeders, the Petitioners should continue identifying high loss making feeders and target
shall be set for loss reduction and steps should be taken to achieve the set target.

60. Revenue Billed and Revenue Collected

The Objector asked the petitioners to submit Revenue Billed and Revenue Collected
for FY 2017-18.

Response of the Petitioners:

Petitioners submitted their collection efficiency as tabulated below;

Collection efficiency
DISCOM
(%)
DGVCL 100.08
MGVCL 100.05
PGVCL 100.00
UGVCL 100.00

Commission’s view:
The response of the Petitioner is self-explanatory.

61. Higher recovery of FPPPA Charges

The FPPPA recovered is more than the basic FPPPA approved in the tariff order.

Response of the Petitioners:

As per the order of the Commission, incremental power purchase cost over the base
power purchase cost is to be recovered through FPPPA charges over and above the
base FPPPA charges (i.e. Rs. 1.43/unit for FY 2017-18). Therefore, during FY 2017-
18 incremental power purchase cost over the base power purchase cost was
recovered over and above the base FPPPA of Rs. 1.43/unit during the quarter. Thus,
there is no excess recovery of FPPPA charges from the consumers during FY 2017-
18.

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Commission’s view:
As explained by the Petitioners, incremental power purchase cost over the base power
purchase cost is to be recovered through FPPPA charges over and above the base
FPPPA charges (i.e. Rs. 1.43/unit for FY 2017-18).

62. Non submission of GETCO, PGCIL and SLDC charges in Power

Purchase Cost-
In truing up of FY 2017-18, Petitioners have not submitted GETCO, GUVNL, SLDC
Charges and PGCIL Charges.

Response of the Petitioners:

Petitioners have not furnished any response in this regard.

Commission’s view:
PGCIL and GETCO Charges are part of power purchase cost, considering the
distribution utilities as beneficiaries of State and National transmission system, and
thus part of ARR to determine gap/ surplus of the truing up year. SLDC Charges as
shown in A & G expenses in the accounts have been considered in Power Purchase
Cost. GUVNL cost is included in Power Purchase Cost.

63. Quantum of UI/DSM sales not submitted, sale of bulk supply not
considered in energy balance and DSM charges are less and SLDC charges are
different for four DISCOMs.
Details regarding quantum of UI/DSM sales to GUVNL along with UI charges borne by
the petitioners are not submitted. Sale of bulk supply power is also not considered in
energy balance and DSM charges are less. It is also submitted that SLDC charges are
different for four DISCOMs.

Response of the Petitioners:

"Energy Balance" is carried out to estimate the "Energy Requirement" for retail sale to
the consumers of the Company. To meet the "Energy Requirement" Power is procured
by the Petitioners from different sources and during the process of real time operation,
"Surplus" Energy is sold to others through GUVNL.

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Commission’s view:
DSM charges depend on system frequency. Treatment of DSM charges i.e. cost and
revenue is given while determining Power Purchase Cost. It is also to mention that
SLDC charges are levied based on contracted capacity which is different in case of
four DISCOMs and therefore, SLDC charges are different. Moreover, sale of bulk
supply in case of PGVCL is sale of power to KPT. It is not considered in energy balance
so as to not distribute power purchase cost of KPT amongst other consumers.

64. Less revenue shown in the ARR/ True up proposal

Less revenue is shown in the ARR / True Up proposal.

Response of the Petitioners:

Revenue in annual accounts includes revenue from sale of surplus power to GUVNL
and DSM charges, besides revenue from sale to different consumer categories as per
Accounting practice. Whereas in the ARR petition, the net power purchase cost is
shown after reducing the amount of surplus power as per requirement of ARR. Netting
of the same heads i.e. revenue from sale of power to GUVNL and DSM Charges have
been done and they have been reduced from total power purchase cost so the amount
of revenue from annual accounts and shown in petition is not same. Revenue from
sale of Power from respective category includes revenue through FPPPA. Also the
head "Other lncome" is classified under the head of non-tariff income in the petition
and the same has been reduced from total ARR rather than including it in the revenue.
So there is no error in the petition but presentation is in different format as per
Accounting Practice and requirement as per MYT Regulations.

Commission’s view:
The Commission has approved the proposal after prudence check considering
revenue from different sources.

65. Subsidizing Agriculture Tariff category consumers

Though agriculture tariff category consumers are being subsidized, subsidizing
category consumers should not pay such tariff rates to subsidize agriculture tariff
category consumers with the reason that agriculture tariffs will be paid by the State
Government.

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Response of the Petitioners:

The National Tariff Policy mentions the need to have a rationatization of tariff to various
consumer categories such that it is more aligned to the cost of supply and in a band of
+-20 % to the average cost of supply. However, while implementing the above, ground
realities of the sector have to be kept in view. One of the primary beneficiaries of the
State's efforts to supply good quality, uninterrupted power is the industries and
commercial entities in the State. On the other hand, agriculture category is being
supplied only limited power per day for 8 hours. Further, mostly this power is supplied
to them during off peak hours and during night time, when the average cost of power
purchase from various generating stations is much lower due to merit order stacking
mechanism for power off take. ln effect, the cost of supply to agriculture category would
be much lower than to other categories enjoying power during peak hours also. Thus,
it is natural that the tariff rates for agriculture is significantly lower than other consumer
categories.
While in the long run it would be desirable to have some rationalization of tariff across
consumer categories, the socio-economic situation of power consumers cannot be
neglected as supplying power at affordable rates to all classes of consumers is a
primary responsibility of a power utility.
In the era when most of the public utilities are working with the principle of subsidising
some part of the consumers, it is not possible for the utility to bill a particular category
on the basis of cost to serve without changing the tariff of the other categories of
consumer. Further, to ensure uniform tariff rates for all four state owned Distribution
Companies, differential bulk supply tariff mechanism is in place.

Commission’s view:
The Commission has always endeavoured to reduce the cross subsidy as provided
under the Electricity Act, 2003 and the Tariff Policy.

66. Waiver of Bad loans

The write off of the dues from Essar Group as indicated in annual accounts has not be
shown in the petition.

Response of the Petitioners:

Generally the amount settled through Lok Adalat, Order received from any of the
judicial forum etc. or amount which is otherwise not recovered even after completing
process / efforts, the same is written-off. This is the practice followed in all business.

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Commission’s view:
DGVCL has shown written off amount as Extra Ordinary Items as part of O & M
expenses in the Petition and also in the annual accounts.

67. No reason provided for deviation from MYT parameters and CAPEX
The Petitioners have not specified reasons for deviation in Mid-Term Review from MYT
parameters and CAPEX

Response of the Petitioners:

The petitions have been as per the principles laid down by the Commission in the
applicable GERC (MYT) Regulations. Growth rates observed for various category of
consumers during the initial two years of the Control Period target for releasing new
connections, implementation of various schemes necessitated review of ARR and
therefore, Company has filed petition for mid-term review of ARR. Capital Expenditure
is mainly proposed to meet with the supply obligation and for System Improvement etc.
GUVNL trades the eventual surplus power and income earned through trading is being
passed on to the consumers of its subsidiary Distribution Companies. GUVNL's Annual
Accounts are available on GUVNL’s website.

Commission’s view:
The Commission has approved CAPEX after prudence check in accordance with the
provisions of the GERC (MYT) Regulations, 2016.

68. Energy savings due to LED bulbs

The Petitioners have not provided any details of energy savings by sale of LED bulbs
in their licensed area.

Response of the Petitioners:

Energy consumption by the consumers is a function of many parameters, therefore, it
is very difficult to derive the exact saving due to LED Bulbs. However, 9 Watts LED
lamps are being used in place of higher wattages of CFL or GLS lamps etc., therefore,
there is energy savings due to LED bulbs.

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Commission’s view:
The Commission, with an intention of monitoring the progress of implementation of
DSM Programmes, has asked the Petitioners to submit quarterly reports in which
energy saving due to implementation of the DSM Programmes is also included.

69. Tariff Proposal not in accordance with law and incomplete formats
The tariff proposals submitted by the Petitioner is not in accordance with the Electricity
Act, 2003, National Electricity Policy and other notifications. Further, the formats of the
Petitions are not complete.

Reply of the petitioner:

The Petitioners have filed the petitions under the provisions of the GERC (MYT)
Regulations, 2016 along with other guidelines and directions issued by the
Commission from time to time and accordingly, all formats to the petition have been
submitted.

Commission’s view:
As provided in Tariff Policy, the Commission has to initiate tariff determination exercise
suo-motu in the absence of filing by the licensee or incomplete filing so as to decide
the tariff timely. Information gaps observed, if any, during processing of the petitions
are sought to be made good from the Petitioners and these are placed on the
Commission’s website for the stakeholders to study.

70. Audit of Distribution Utilities

The objector requested for audit of distribution utilities
Response of the Petitioners:
The Petitioner being a State Government owner Distribution Company, financial
accounts of the Company are always audited by CAG every year

Commission’s view:
The accounts of the Petitioners, being Government owned undertakings, are audited
by the Statutory Auditors appointed by the C & AG. Further, the accounts of the
Petitioners are subject to supplementary audit by the C & AG. Moreover, the C & AG
also conduct issue based performance/ propriety audit of the Petitioners. The
Commission, therefore, does not find any merit in the objector’s submission.

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71. GUVNL’s Audited Accounts

The Objector requested the Commission to ask GUVNL to submit its Annual Accounts.

Response of the Petitioners:

GUVNL’s Annual Accounts are available on GUVNL website.

Commission’s view:
The Commission noted the response of the Petitioners.

72. Tariff for Industrial Category Consumers

The tariff for Industrial Category Consumers is higher.

Response of the Petitioners:

The National Tariff Policy mentions the need to have a rationalization of tariff to various
consumer categories such that it is more aligned to the cost of supply in the band of
+/- 20% to the average cost of supply. It is further submitted that in order to ensure
uniform tariff rates for all four State Owned DISCOMs, bulk supply tariff mechanism is
in place. Further, average recovery from all categories remains within the band of +/-
20% to the average cost of supply.

Commission’s view:
The response of the Petitioners is self-explanatory.

73. Minimize O & M expenses

The Objector stated that O & M expenses are high and should be minimized

Response of the Petitioners:

----

Commission’s view:
O & M expenses are approved in accordance with relevant provisions of the GERC
(MYT) Regulations, 2016 as detailed in Chapter 4 of this Order.

74. Rate of Delayed Payment Charges should be brought down to 7%

The Objector stated that as loan interest rate is reduced, banks have reduced deposit
rates to make up the difference. Considering this fact, the DPC rate of 15% (other than

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agriculture consumers) and of 12% (for agriculture consumers) should be brought

down to 7% per annum.

Response of the Petitioner:

----------

Commission’s view:

Delayed Payment Charges is a penalty and cannot be equated with Bank Interest
Rates.

75. Metering of Distribution Transformers

Metering should be done at all Distribution Transformer Centres to ascertain losses
and taking corrective action.

Response of the Petitioners:

----

Commission’s view:
Necessary directive to meter all Distribution Transformer Centres has already been
issued and the Commission has periodically reviewed progress made by the
Petitioners in metering Distribution transformers.

76. Allow Bank Guarantee towards Security Deposit and not to levy Security
Deposit from consumers who have pre-paid meters.
The Objector requested to allow Bank Guarantee towards Security Deposit for all the
categories of consumers. It is also requested to refund Security Deposit collected from
consumers when smart pre-paid meters are installed.

Response of the Petitioners:

----

Commission’s view:
The said option to furnish Security Deposit in the form of irrevocable Bank Guarantee
is available for the consumers whose Security Deposit exceeds Rs. 25 Lakhs.
However, the Commission is of the view that the matter is related to Regulations on
Security Deposit and may be dealt separately.

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77. Cost of Supply at EHV level

The Objector stated that there is no need to work out Cost of Supply at EHV level.

Response of the Petitioners:

----

Commission’s view:
Tariff determination is based on overall Average Cost to Serve. Consumers are being
connected at different voltage level according to their load requirement and as per
relevant provisions of the Electricity Supply Code. Therefore, the Commission is of the
view that consumer being supplied at a certain voltage level by virtue of its load
requirement, Cost of Supply at EHV level is necessary and accordingly directive to
work out Cost of Supply at EHV level was given in past year’s Tariff Order.

78. Disclosure of Expenditure incurred for the projects which were

outsourced
The expenditure incurred for the projects which are outsourced should be shown
separately.

Response of the Petitioners:

----
Commission’s view:
The Commission is of the view that expenditure incurred for the projects whether
outsourced or implemented through internal workforce, treatment is given same to
CAPEX and capitalization and thus do not make any difference.

79. Consumers not to pay PGCIL charges

The consumers should not be made to pay PGCIL charges

Response of the Petitioners:

----
Commission’s view:
PGCIL Charges are part of the total power purchase cost, considering distribution
utilities as the beneficiaries of the State and National transmission system, and thus
part of ARR to determine gap/ surplus of the truing up year.

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80. Fixed cost of stranded generation capacity

The Objector objected the consumers being made to pay fixed cost for stranded
generation capacity.

Response of the Petitioners:

----
Commission’s view:
Petitioners, against one of the objections above, have submitted that with the existing
fixed charges, DISCOMs are able to recover 36% of fixed cost. It is also to state here
that even though generation capacity is stranded, DISCOMs are bound to provide 24*7
power supply to the consumers and are also bound to keep the capacity ready in case
OA consumers need it. Considering these requirements, DISCOMs are paying fixed
cost to generating stations based on their Plant Availability and not on Plant Load
Factor and this is in line with the present Regulations.

81. To make last 5 years’ Petitions as well as data of FPPPA available on

website
The Petitioner should make available last 5 years’ Petitions and FPPPA data on their
websites

Response of the Petitioners:

----
Commission’s view:
The Commission is of the view that Petitioner should examine the suggestion of the
Respondent about uploading the last 5 years Petitions at the time of uploading tariff
petitions for the truing up of last year and tariff determination of ensuing year so that
consumers can have access to past data for comparison and take appropriate actions
including upgradation of its IT system. Licensees/ GUVNL should also keep the FPPPA
data for last 8 quarters on their websites.

3.3 Issues pertaining to UGVCL

1. Objection against Petition

The Objector has objected against the petition filed by the Petitioner for determination
of tariff for FY 2019-20.

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Response of the Petitioner:

The issue raised by the Objector is not a specific objection to the present petition filed
by the Petitioner.

Commission’s view:

The Commission has noted the response of the Petitioner. The Commission carries
out tariff determination exercise in accordance with relevant Regulations

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4 Truing up of FY 2017-18

This Chapter deals with truing up of FY 2017-18.

UGVCL, in its submission for True-up of FY 2017-18, has furnished details of the actual
energy sales, expenditure and revenue, based on the audited annual accounts for FY
2017-18. The Petitioner has stated that the truing up for FY 2017-18 is based on the
comparison of the actual performance of FY 2017-18 with the approved aggregate
revenue requirement for FY 2017-18 in the MYT Order dated 31st March, 2017 to
arrive at the Gain/(Loss), as per the GERC (MYT) Regulations.

The Commission has analysed the components of the actual energy sales, expenses,
revenue and computed Gain/(Loss) in the process of truing up for FY 2017-18.

4.1 Energy sales

Petitioner’s submission
The Petitioner has submitted the category-wise actual energy sales for FY 2017-18 as
given in the Table below:

Table 4-1: Category-wise sales for FY 2017-18

(MUs)
Approved in Actual
Particulars the MYT Claimed in
Order Truing up
A LT Consumers
1 RGP 2200 2102
2 GLP 48 45
3 Non-RGP & LTMD 1733 1763
4 Public Water Works 718 708
5 Agriculture- Unmetered 6219 6313
6 Agriculture-Metered 3253 2736
7 Public Lighting 59 52
LT Total (A) 14230 13718
B HT Consumers
8 Industrial HT 4716 6418
9 Railway Traction 0 0
HT Total (B) 4716 6418
Grand Total (A+B) 18946 20137

Commission’s Analysis

The Commission, in the MYT Order, dated 31st March, 2017, had approved the energy
sales of 18946 MUs for FY 2017-18 against which, UGVCL has submitted the actual
sales of 20137 MUs.

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As can be observed from the Table above that the actual energy sales to LT categories
are lower than those approved by the Commission for FY 2017-18 in the MYT Order
dated 31st March, 2017. However energy sales in Industrial HT category is higher by
36.09% than approved in the MYT Order dated 31st March, 2017.
Overall, the actual energy sales of UGVCL is higher by 1191 MUs, against what is
approved in the MYT Order dated 31st March, 2017. As energy sales depend upon
factors, which are related to income level and overall growth of the economy, it remains
largely uncontrollable in nature.
The Commission approves the energy sales of 20137 MUs as detailed in the Table
below:

Table 4-2: Energy sales approved in truing up for FY 2017-18

(MUs)
Approved in Actual Approved
Sr.
Particulars the MYT Claimed in in Truing
No.
Order Truing up up for
A LT Consumers
1 RGP 2200 2102 2102
2 GLP 48 45 45
3 Non-RGP & LTMD 1733 1763 1763
4 Public Water Works 718 708 708
5 Agriculture-Unmetered 6219 6313 6313
6 Agriculture-Metered 3253 2736 2736
7 Public Lighting 59 52 52
LT Total (A) 14230 13718 13718
B HT Consumers
8 Industrial HT 4716 6418 6418
9 Railway Traction 0 0 0
HT Total (B) 4716 6418 6418
Grand Total (A+B) 18946 20137 20137

4.2 Distribution Losses

Petitioner’s submission

The Petitioner has submitted that the actual distribution losses for FY 2017-18 are
8.31%, as against the approved losses of 9.90% in the MYT Order dated 31st March,
2017 as given in the Table below:

Table 4-3: Distribution Losses

Approved Actual
Sr. No. Particulars in the MYT Claimed in
Order Truing up
1 Distribution Losses 9.90% 8.31%

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The Petitioner submitted that as per the GERC (MYT) Regulations, 2016 the
distribution losses need to be treated as controllable and any gain or loss has to be
dealt with, accordingly, as per the provisions of the MYT Regulations.
The Petitioner submitted that it has achieved significant reduction in distribution losses
during recent years and shall continue its efforts to reduce the distribution losses
further.
Commission’s Analysis
UGVCL has contended that the actual distribution losses are 8.31% for FY 2017-18,
as against 9.90% approved in the MYT Order dated 31st March, 2017.
The Commission considers distribution losses as controllable as per the GERC (MYT)
Regulations, 2016. Accordingly, the Commission considers the distribution losses of
9.90% as shown in the Table below for computation of Gain/ (Loss) due to variance in
distribution losses.

Table 4-4: Distribution Losses approved for truing up for FY 2017-18

Approved in the Actual Claimed in Approved in
Particulars
MYT Order truing up True Up
Distribution Losses 9.90% 8.31% 9.90%

4.3 Energy requirement

Petitioner’s submission

UGVCL has submitted the energy requirement for FY 2017-18 based on the actual
energy sales and the actual distribution losses, as given in the Table below.

Table 4-5: Energy requirement and Energy balance as submitted by UGVCL for FY
2017-18
Approved Actual
Sr.
Particulars Unit in the MYT Claimed in
No.
Order Truing up
1 Energy Sales MUs 18946 20137
2 MUs 2082 1824
Distribution Losses
% 9.90% 8.31%
3 Energy Requirement MUs 21028 21961
4 Local Power Purchase by Discom MUs 50
5 Power Purchase at T<>D periphery from GUVNL 21911
5 Transmission Losses MUs 842 853
5 Total Energy to be input to Transmission System MUs 21870 22764
6 Pooled Losses in PGCIL System MUs 336 396
7 Total Energy Requirement MUs 22206 23210

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Commission’s Analysis

UGVCL has computed the energy requirement based on the distribution losses of
8.31%, actual energy sales of 20137 MUs and transmission losses of 3.75%
The Commission had approved the distribution losses of 9.90% and the transmission
losses of 3.85% in the MYT Order dated 31st March, 2017.

Accordingly, the Commission has worked out the energy requirement of 23210 MUs
for truing up of FY 2017-18 as shown in the Table below:

Table 4-6: Energy requirement approved by the Commission for truing up for FY
2017-18
Approved Actual Approved
Sr.
Particulars Unit in MYT Claimed in in truing
No.
Order truing up up
1 Energy Sales MUs 18946 20137 20137
2 MUs 2082 1824 1824
Distribution Losses
% 9.90% 8.31% 8.31%
3 Energy Requirement MUs 21028 21961 21961
4 Transmission Losses MUs 842 853 853
Total Energy to be input to
5 Transmission System MUs 21870 22764 22764
6 Pooled Losses in PGCIL System MUs 336 396 396
7 Total energy requirement MUs 22206 23210 23210

4.4 Power Purchase Cost

Petitioner’s submission
The Petitioner has submitted that the company has been allocated share of generation
capacities as per the scheme worked out by GUVNL.
UGVCL has submitted the actual power purchase cost incurred during FY 2017-18, as
shown below:

Table 4-7: Power Purchase Cost claimed by UGVCL for FY 2017-18

(Rs. Crore)
Approved in the MYT Actual Claimed in
Particulars
Order truing up
Total Power Purchase Cost 8866.95 9004.23

Power Purchase Cost given above is the net power purchase cost after considering
the SLDC Charges, net UI/ DSM Charges Payable/Receivable and the revenue from
sale of power to GUVNL. UGVCL has submitted the break-up of actual power purchase
cost incurred during FY 2017-18, as shown in the Table below:

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Table 4-8: Power Purchase Cost submitted by UGVCL for FY 2017-18

(Rs. Crore)
Sr. Approved in Actual Claimed
Particulars
No. the MYT Order in Truing up
A Cost
1 Power Purchase from GUVNL 9142.76
2 Unscheduled Interchange/DSM Charges 5.95
3 Power Purchase from Wind Farm 11.04
4 Power Purchase from Solar 22.70
5 SLDC Charges 3.49
B Income
1 Sale of Power to GUVNL 87.55
2 Unscheduled Interchange/DSM Charges 94.16
Net Power Purchase Cost 8866.95 9004.23

UGVCL submitted that the total power purchase cost for FY 2017-18 consists of the
basic power purchase cost, transmission charges payable to GETCO and PGCIL,
SLDC charges and the DISCOM’s share of GUVNL cost.
The quantum of power purchase depends upon sales during the year as well as the
losses in the system. Though the actual distribution losses in UGVCL distribution
network have been lower than the approved level and the sales are higher than that
approved by the Commission and hence, the overall quantum of power purchased was
higher than the approved quantum of power required.

As per the GERC (MYT) Regulations, 2016 the Commission has categorised the
variation in the price of fuel and/or price of power purchase according to the FPPPA
formula approved by the Commission as an uncontrollable factor. Further, the
Commission has also identified the variation in the number or mix of consumers or
quantity of electricity sold to consumers as an uncontrollable factor. Thus, the variation
in these factors affects the power purchase expenses and results into either a loss or
gain. Accordingly, any gain or loss on this account is to be entirely passed on to the
consumers as per the methodology approved by the Commission.
In addition to the above, there is an incidence of lower power purchase cost on account
of the lower Distribution loss as compared to the loss approved by the Commission.
These gain has resulted in lower power purchase expenses as the quantum of power
required to be purchased to meet the same level of demand would be lower hence
resulting in the gain.

The increase or reduction in quantum of power purchase and power purchase cost
due to variation in distribution loss is a controllable factor which would result in
Gain/Loss under the GERC (MYT) Regulations, 2016 and is dealt with accordingly.

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Commission’s Analysis

The Commission has examined the actual quantum of power purchased and the power
purchase cost during FY 2017-18, based on the actual energy sales and the
distribution losses submitted by UGVCL. The sales and the quantum of power
purchase and the power purchase cost are as per the audited annual accounts for FY
2017-18. The Commission has observed that the Petitioner has, in the audited
accounts included the SLDC charges of Rs. 3.49 Crore in A & G Expenses. Since the
same is a part of Power Purchase Cost, it is reduced from A & G Expenses and
included in the Power Purchase Cost. After addition of SLDC charges of Rs. 3.49
Crore, deduction of Income of Rs. 87.55 Crore towards Sale of Power to GUVNL and
UI/DSM Expenses or Income, the Power Purchase Cost works out to Rs. 9004.23
Crore as shown in the Table below:

Table 4-9: Power Purchase Cost as per the audited accounts for FY 2017-18
(Rs. Crore)
Sr. No. Particulars Amount
1 Power Purchased from GUVNL 9142.76
2 Power Purchased from CPP/Wind Farms 11.04
3 Power Purchased from Solar 22.70
4 UI/DSM Charges (Expense) 5.95
5 SLDC Charges 3.49
6 Total Power Purchase 9185.94
7 Power sold to GUVNL (Income) 87.55
8 UI/DSM Charges (Income) 94.16
9 Net Power Purchase Cost (6-7-8) 9004.23

The Commission approves the power purchase cost of Rs. 9004.23 Crore for FY 2017-
18 as per the audited annual accounts.

Table 4-10: Power Purchase Cost approved by the Commission for truing up for FY
2017-18
(Rs. Crore)
Approved in the Actual Claimed Approved in
Particulars
MYT Order in Truing up Truing up
Total Power Purchase Cost 8866.95 9004.23 9004.23

4.5 Gain / (Loss) due to Distribution Losses

Petitioner’s Submission
UGVCL has claimed that there is gain of Rs. 150.64 Crore in the power purchase cost
due to lower distribution losses as compared to distribution losses approved in the

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MYT Order dated 31st March, 2017. The gain is considered as controllable variation.
The calculation of gain on account of lower distribution losses as submitted by UGVCL
is shown in the Table below:

Table 4-11: Gain/ (Loss)on account of Distribution Losses for FY 2017-18 as submitted
by UGVCL

With
With Actual
Sr. Approved
Particulars Unit Distribution
No. Distribution
Losses
Losses
1 Energy Sales MUs 20136.78 20136.78
2 MUs 2212.59 1824.28
Distribution Losses
% 9.90% 8.31%
3 Energy Requirement MUs 22349.37 21961.06
4 Saving due to Distribution Losses MUs - 388.31
5 Average Cost of Power Purchase Rs./kWh - 3.88
6 Gain/(Loss) Due to Dist. Losses Rs. Crore - 150.64

Commission’s Analysis
The Commission has approved distribution losses at 9.90% for FY 2017-18 in the MYT
Order dated 31st March, 2017 against which UGVCL has achieved distribution losses
of 8.31%. However, as discussed in Section 4.2, the Commission approves 9.90% as
the distribution loss for truing up of FY 2017-18.
The total Gain / (Loss) on account of lower distribution losses are computed in the
Table below:

Table 4-12: Approved Gain/ (Loss) on account of Distribution Losses for FY 2017-18
(Rs. Crore)
with
Approved
Sl. Approved
Particulars Units for truing
no. Distribution
up
Losses
1 Energy Sales MUs 20136.78 20136.78
2 MUs 2212.59 1824.28
Distribution Losses
% 9.90% 8.31%
3 Energy Requirement MUs 22349.37 21961.06
4 Saving due to Distribution Losses MUs - 388.30
5 Average Power Purchase Cost Rs./Unit - 3.88
6 Gain/(Loss) due to Dist. Losses - 150.64

The total gain on account of lower distribution losses, as computed by the Commission
of Rs. 150.64 Crore is attributable to controllable factors.
While computing the Gain / (Loss) due to change in distribution losses, the
Commission has considered the distribution losses at 9.90% of actual energy sales to
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arrive at change in energy requirement at the distribution periphery and did not
consider the transmission losses to factor the efficiency of distribution activities only.
The Commission considered change in power purchase cost as uncontrollable and
attributable to the variation in cost and quantum of power due to variations in sales and
transmission losses, while variations in quantum of power due to distribution losses
are considered as controllable. Accordingly, Gain/Loss computed on account of power
purchase are shown in the Table below:

Table 4-13: Approved gain / (loss) – power purchase expenses for truing up for FY
2017-18
(Rs. Crore)
Gain/(Los
Approve Gain/(Loss)
Approved s) due to
d in Deviatio due to
Particulars in the MYT Controlla
Truing n + (-) Uncontrolla
Order ble
up ble Factors
Factors
Total Power Purchase Cost 8,866.95 9,004.23 (137.28) 150.64 (287.92)

4.6 Fixed Charges

4.6.1 Operation and Maintenance (O&M) Expenses for FY 2017-18

UGVCL has claimed O&M Expenses of Rs. 623.31 Crore, which is inclusive of
Employee Cost of Rs. 531.92 Crore, Repairs & Maintenance Expenses of Rs. 61.36
Crore, Administration & General Expenses of Rs. 99.22 Crore and Other Expenses
Capitalized of Rs. 69.19 against the approved O&M Expense of Rs. 443.05 Crore as
per the details given in the Table below:

Table 4-14: O&M Expenses claimed in the truing up for FY 2017-18

(Rs. Crore)
Approved Actual
Deviation
Sr.No. Particulars in the MYT Claimed in
+ (-)
Order Truing up
1 Employee Cost 423.58 531.92 (108.34)
2 Repairs & Maintenance Expenses 88.50 61.36 27.14
3 Administration & General Expenses 75.69 99.22 (23.53)
4 Other Debits - - -
5 Extraordinary Items - - -
6 Net Prior Period Expenses /(Income) - - -
7 Other Expenses Capitalised (144.72) (69.19) (75.53)
8 Operation & Maintenance Expenses 443.05 623.31 (180.26)

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Petitioner’s submission

UGVCL has compared the O&M expenses actually incurred during FY 2017-18 with
the expenses approved by the Commission in the MYT Order dated 31st March, 2017
and arrived at gain/ (loss) as shown in the Table below:

Table 4-15: O&M Expenses and Gain / Loss claimed in the truing up for FY 2017-18
(Rs. Crore)
Actual Gain/(Loss) Gain/(Loss)
Approved
Sr. Claimed due to due to
Particulars in the MYT
No. in Truing Controllabl Uncontrollabl
Order
up e Factors e Factors
1 Employee Cost 423.58 531.92 (82.56) (25.78)
Repairs & Maintenance
88.50 61.36 27.14
2 Expenses
Administration & General
75.69 99.22 (23.53)
3 Expenses
4 Other Debits - - -
5 Extraordinary Items - -
Net Prior Period Expenses
- -
6 /(Income)
7 Other Expenses Capitalised (144.72) (69.19) (75.53)
8 Total O & M Expenses 443.05 623.31 (78.95) (101.31)

The component-wise O&M expenses are discussed in the following paragraphs.

4.6.1.1 Employee Cost

UGVCL has claimed Rs. 531.92 Crore towards the employee cost in the truing up for
FY 2017-18. The employee cost approved for FY 2017-18 in the MYT Order dated 31st
March, 2017 and claimed by UGVCL in the truing up are given in the Table below:

Table 4-16: Employee Cost claimed by UGVCL in the truing up for FY 2017-18
(Rs. Crore)
Gain/(Loss) Gain/(Loss)
Approved Actual
Sr. due to due to
Particulars in the MYT Claimed in
No. Controllable Uncontrollable
Order Truing up
Factors Factors
1 Employee Cost 423.58 531.92 (82.56) (25.78)

Petitioner’s submission

UGVCL has submitted that the actual employee cost for FY 2017-18 was Rs. 531.92
Crore which excludes the provision made towards 7th Pay Commission of Rs. 54.80
but includes the actual amount paid towards 7th Pay Commission of Rs. 25.78 Crore
and Rs. 60.91 Crore of Re-measurement of defined benefits plans. The Commission
in the MYT Order dated 31st March, 2017 and True Up Order of FY 2016-17 dated 31st

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March, 2018 had not approved the provision made for respective years towards the
impact of 7th Pay Commission considering that actual payment is not made and had
ruled that as and when the actual expenses are incurred, the Commission would
consider such claims, which would be accounted for during the true up of annual
account of the respective year as uncontrollable factor. The employee cost was
incurred on the basis of the guidelines issued by the competent authorities like the
State Government and that the entire expenditure estimated is a legitimate expenditure
and any variation is purely beyond its control. Accordingly, UGVCL has estimated a
loss of Rs. 82.56 Crore on account of controllable factors and Rs. 25.78 Crore on
account of uncontrollable factors.
Commission’s Analysis

UGVCL has compared the actual employee cost of Rs. 531.92 Crore incurred during
FY 2017-18 with Rs. 423.58 Crore approved in the MYT Order dated 31st March, 2017.
The actual employee cost, as per the audited annual accounts for FY 2017-18 is Rs.
525.81 Crore before capitalization of Rs. 59.85 Crore. Further, the Petitioner has
submitted that the aforesaid employee cost excludes Rs. 54.80 Crore towards
Provision for 7th Pay Commission but includes Rs. 25.78 Crore towards the actual
payout on account of wage revision. The Petitioner has added the Re-measurement
of the Defined Benefit Plans of Rs. 60.91 Crore as appearing in the Statement of P&L
for the year ended 31st March, 2018 being the component of employee cost to arrive
at claimed figure of Rs. 531.92 Crore.
Therefore, the Commission considers Rs. 531.92 Crore as employee expenses for the
purpose of true up of FY 2017-18. The Commission considers the employee cost as a
controllable expense, which is in line with the MYT Regulations. Further, the actual
payments towards the 7th Pay Commission of Rs. 25.78 Crore has been considered
as uncontrollable.
The Commission, accordingly, approves the employee cost at Rs. 531.92 Crore in the
truing up for FY 2017-18.

Table 4-17: Employee Cost approved in the truing up for FY 2017-18

(Rs. Crore)
Gain/(Loss) Gain/(Loss)
Approved Approved
Sr. due to due to
Particulars in the MYT in truing
No. Controllabl Uncontrollabl
Order up
e Factors e Factors
1 Employee Cost 423.58 531.92 (82.56) (25.78)

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4.6.1.2 Repairs & Maintenance (R&M) Expenses

UGVCL has claimed Rs. 61.36 Crore towards R&M expenses in the truing up for FY
2017-18. The R&M expenses approved for FY 2017-18 in the MYT Order dated 31st
March, 2017 and claimed by UGVCL in the truing up are as given in the Table below:

Table 4-18: R&M Expenses claimed by UGVCL for the truing up for FY 2017-18
(Rs. Crore)
Approved Actual Gain/(Loss) Gain/(Loss)
Sr. in the Claimed due to due to
Particulars
No. MYT in Truing Controllable Uncontrolla
Order up Factors ble Factors
Repairs & Maintenance
1 88.50 61.36 27.14
Expenses

Petitioner’s submission

UGVCL has submitted that the assets of UGVCL are old and require regular
maintenance to ensure uninterrupted operations. It has been further submitted that
UGVCL has been trying its best to ensure uninterrupted operations of the system by
undertaking necessary expenditure for R&M activities. UGVCL has worked out a gain
of Rs. 27.14 Crore due to controllable factors as provided in the GERC (MYT)
Regulations, 2016.
Commission’s Analysis

The actual R&M expenses incurred during FY 2017-18 are Rs. 61.36 Crore, as per the
audited annual accounts. The Commission has observed that R&M expenditure
incurred by UGVCL is lower than the amount approved in the MYT Order dated 31st
March, 2017. The R&M expenses is a controllable item of expenditure under the GERC
(MYT) Regulations, 2016.
The Commission accepts the contention of UGVCL and accordingly approves the R&M
expenses at Rs. 61.36 Crore in the truing up for FY 2017-18.

Table 4-19: R&M Expenses approved for the truing up for FY 2017-18
(Rs. Crore)
Gain/(Loss) Gain/(Loss)
Approved Approved
Sr. due to due to
Particulars in the MYT in truing
No. Controllable Uncontrolla
Order up
Factors ble Factors
Repairs & Maintenance
1 88.50 61.36 27.14
Expenses

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4.6.1.3 Administration & General (A&G) Expenses

UGVCL has claimed Rs. 99.22 Crore towards A&G expenses in the truing up for FY
2017-18. The A&G expenses approved for FY 2017-18 in the MYT Order dated 31st
March, 2017 and claimed by UGVCL in the truing up are given in the Table below:

Table 4-20: A&G Expenses claimed by UGVCL in the truing up for FY 2017-18
(Rs. Crore)
Gain/(Loss
Actual Gain/(Loss)
Approved ) due to
Sr. Claimed due to
Particulars in the MYT Uncontroll
No. in Truing Controllabl
Order able
up e Factor
Factors
Administration & General
1 75.69 99.22 (23.53)
Expenses

Petitioner’s submission

UGVCL has submitted that the A&G expenses are categorised as controllable
expenses in the GERC (MYT) Regulations, 2016 and the actual A&G expenses, when
compared with the approved value, resulted in a loss of Rs. 23.53 Crore for FY 2017-
18.
Commission’s Analysis
The Commission verified the audited annual accounts of UGVCL and observed that
actual A&G Expenses as per audited annual accounts is Rs. 171.91 Crore before
Capitalization of Expenses of Rs. 9.34 Crore. It is further observed that this amount
has included Repairs & Maintenance Expenses of Rs. 61.36 Crore, SLDC Charges of
Rs. 3.49 Crore, Bad Debts Written Off of Rs. 0.31 Crore, CSR Expenses of Rs. 0.35
Crore and Provision for Bad & Doubtful Debts of Rs. 7.18 Crore in A & G Expenses.
While the Commission has dealt with the R&M Expenses separately in Para 4.6.1.2
above, SLDC Charges are included in Power Purchase Cost approved at Table 4.9 of
this Order. The Commission has also dealt with the Bad Debts Written Off separately
in this Order. Accordingly, the Commission has excluded these items of expenditure
from A & G Expenses along with CSR Expenses and Provision for Bad & Doubtful
Debts in terms of the GERC (MYT) Regulations, 2016 to arrive at the net A & G
Expenses of Rs. 99.22 Crore and approves the same. The Commission observes that
the actual A&G expenses of Rs. 99.22 Crore is higher than Rs. 75.69 Crore approved
in the MYT Order dated 31st March, 2017 by Rs. 23.53 Crore.

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The parameters impacting A&G expenses are controllable in nature, as specified in

the GERC (MYT) Regulations, 2016. The Commission, accordingly, considers Rs.
23.53 Crore as loss on account of controllable factors.
The Commission, accordingly, approves the A&G expenses at Rs. 99.22 Crore
in the truing up for FY 2017-18.

Table 4-21: A&G Expenses approved in the truing up for FY 2017-18

(Rs. Crore)
Approved Gain/(Loss) Gain/(Loss)
Approved
Sr. in the due to due to
Particulars in truing
No. MYT Controllable Uncontrolla
up
Order Factors ble Factors
Administration & General
1 75.69 99.22 (23.53)
Expenses

4.6.1.4 Other Expenses Capitalised

UGVCL has claimed the actual expenses capitalised at Rs. 69.19 Crore in the truing
up for FY 2017-18, as against Rs. 144.72 Crore approved in the MYT Order dated 31st
March, 2017 as shown in the Table below:

Table 4-22: Other Expenses Capitalized as claimed by UGVCL in the truing up for FY
2017-18
(Rs. Crore)
Approved Actual Gain/(Loss) Gain/(Loss)
Sr. in the Claimed due to due to
Particulars
No. MYT in Truing Controllable Uncontrollable
Order up Factors Factors
Other Expenses
(144.72) (69.19) (75.53)
1 Capitalized

Commission’s Analysis
The Commission has observed that the other expenses capitalised represent the
capitalisation of Employee Cost and A&G Expenses, as seen from the annual accounts
for FY 2017-18. The actual other expenses capitalised is Rs. 69.19 Crore, as per the
audited annual accounts for FY 2017-18.
The Commission, accordingly, approves the Other Expenses Capitalised at Rs. 69.19
Crore against Rs. 144.72 Crore approved in the MYT Order dated 31st March, 2017.
The Commission allows Rs. 75.53 Crore as loss due to uncontrollable factors as shown
in the Table below:

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Table 4-23: Other Expenses Capitalized approved in the truing up for FY 2017-18
(Rs. Crore)
Approved Gain/(Loss) Gain/(Loss)
Approved
Sr. in the due to due to
Particulars in truing
No. MYT Controllable Uncontrollabl
up
Order Factors e Factors
Other Expenses
1 (144.72) (69.19) (75.53)
Capitalized

The total O&M expenses approved in the truing up for FY 2017-18 and the Gain /
(Loss) due to controllable and uncontrollable factors are detailed in the Table below:

Table 4-24: Approved O&M expenses and Gain / Loss in the truing up for FY 2017-18
(Rs. Crore)
Actual Gain/(Los Gain/(Loss
Approved
Claimed Approved s) due to ) due to
in the Deviation
Particulars in in truing Controlla Uncontroll
MYT + (-) (2-4)
Truing up ble able
Order
up Factors Factors
1 2 3 4 5 6 7
Employee Cost 423.58 531.92 531.92 (108.34) (82.56) (25.78)
Repairs & Maintenance
88.50 61.36 61.36 27.14 27.14
Expenses
Administration &
75.69 99.22 99.22 (23.53) (23.53)
General Expenses
Other Debits - - - -
Extraordinary Items - - - -
Net Prior Period
- - - -
Expenses /(Income)
Other Expenses
(144.72) (69.19) (69.19) (75.53) (75.53)
Capitalised
Total O & M Expenses 443.05 623.31 623.31 (180.26) (78.95) (101.31)

4.6.2 Capital expenditure, Capitalization and Funding of CAPEX

UGVCL has furnished actual capital expenditure of Rs. 629.31 Crore in the truing up
for FY 2017-18, against Rs. 784.43 Crore approved in the MYT Order dated 31st March,
2017 as given in the Table below:

Table 4-25: Capital expenditure claimed by UGVCL for FY 2017-18

(Rs. Crore)

Actual
Approved in
Particulars Claimed in Deviation
the MYT Order
Truing up
Distribution Schemes
Normal Development Scheme 175.00 241.70 (66.70)
System Improvement Scheme 35.00 24.54 10.46
HVDS in selected sub-division 5.50 4.93 0.57
Underground cables 100.00 0.07 99.93
Plan Load management Transformer 4.00 0.00 4.00
Others (VDS) 0.65 1.02 (0.37)
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Actual
Approved in
Particulars Claimed in Deviation
the MYT Order
Truing up
Total 320.15 272.26 47.89
Rural Electrification Schemes Plan -
TASP (Wells) & Petapara 35.00 22.65 12.35
Scheduled Caste Sub Plan(Wells) 5.00 0.16 4.84
Scheduled Caste Sub Plan(lighting) 3.00 1.63 1.37
Electrification of Hutments 5.00 12.21 (7.21)
Kutir Jyoti Scheme 0.50 59.25 (58.75)
Dark Zone 150.00 90.18 59.82
Sagarkhedu 4.50 2.03 2.47
Solar home light 25.00 0.00 25.00
Total 228.00 188.11 39.89
Central Government Schemes- Plan
DDUJGY 60.00 43.65 16.35
R-APDRP Part A 2.05 0.00 2.05
IPDS 51.00 40.77 10.23
SCADA Part A 0.21 7.54 (7.33)
SCADA Part B 0.00 1.14 (1.14)
Smart Grid 14.00 3.46 10.54
Total 127.26 96.56 30.70
Other Schemes (Non Plan) -
RE (Tatkal) 6.00 6.05 (0.05)
AG Normal (SPA) 60.00 45.50 14.50
Energy Conservation 0.10 0.08 0.02
Total 66.10 51.63 14.47
Other New Schemes
Automation and Computerization 4.35 0.00 4.35
Civil Work / New Building 16.00 0.06 15.94
GIS in Cities 0.20 3.44 (3.24)
Other Schemes (Earthing) 0.87 0.00 0.87
Other Repairing Work/Civil Work 2.00 1.26 0.74
New Furniture and Fixtures 2.00 0.00 2.00
Vehicles 0.50 1.79 (1.29)
DSM 2.00 0.71 1.29
DISS 10.00 0.00 10.00
Solar Pump 5.00 13.49 (8.49)
Total 42.92 20.75 22.17
Capital Expenditure Total 784.43 629.31 155.12

Petitioner's Submission
UGVCL has submitted that the actual capital expenditure incurred during FY 2017-18
is Rs. 629.31 Crore which is lower by Rs. 155.12 Crore than what was approved in the
MYT Order dated 31st March, 2017. UGVCL has explained the scheme wise deviation
in the capital expenditure as below:

1. Normal Development: Under the head Normal Development Scheme, generally

expenses are incurred to meet with the Supply Obligation. During the FY 2017-18,
growth of the Company in terms of number of consumers and load has exceeded

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than envisaged, therefore, company had to incur Rs. 241.70 Crore against
approved Rs. 175.00 Crore.

2. System Improvement Scheme: The system improvement scheme i.e. S.I.

scheme include various activities such as bifurcation of feeders, overhead to
underground cable conversion, new substation link line work, H.T. Aerial bunch
conductor, replacement of deteriorated conductor, L.T. Aerial bunch conductor
and distribution transformer review etc. The S.I. scheme is required for providing
quality and reliable power supply to our esteemed consumers. As per the capital
expenditure report for F.Y. 2017-18, the approved cost for system improvement
scheme is Rs. 35.00 Crore against which UGVCL has incurred Rs. 24.54 Crore
for activities related to S.I. scheme. The reduction in expenditure with reference to
the approved is due to the fact that UGVCL has carried out replacement of
deteriorated conductor in SKJY scheme and Feeder bifurcation work in IPDS and
DDUGJY scheme.

3. Under Ground cables scheme: In Underground cables scheme, work related to

conversion of overhead to underground network in mahanagarpalika area,
approved cost for this scheme is Rs. 100 Crore. In this scheme, necessary DPR
was not approved hence the work was not carried out in year 2017-18.

4. Other (VDS) Scheme: Agriculture Voluntary disclosure scheme (AG VDS) was
announced in year 2017-18. Expenditure of Rs. 1.02 Crore is incurred for releasing
the load of Agriculture connection under the scheme.

5. RE Scheme: Release of Agriculture Connection is a continuous process and it is

governed by Government of Gujarat by monitoring the Fund, availability of Energy
and Infrastructure. Under the head RE Schemes, the Company releases
Agriculture category connections. The Company has invited applications for switch
over to Tatkal Scheme from the registered pending applicants in the year 2017-18
in addition to TASP and Normal scheme. During the FY 2017-18, UGVCL has
planned to clear the application registered in Year 2012 to 2016 in TASP, SPA
and Dark Zone Scheme. During the FY 2017-18, Company has released 14909
Agriculture connections. In TASP Scheme, 2068 wells are electrified against the
target of 2000 wells, the financial expenditure incurred per Ag well is decreased,
hence the deviation observed. In SCSP AG well scheme it is directed to clear all

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the pending applications of SC beneficiaries so the booked amount is increased.

In Kutirjyoti (Lighting) and electrification of Hutments (Zupadpatti) scheme the
more number of beneficiaries came forward for getting Household electrification,
hence the expenditure increased. In Darkzone and AG Normal Well (SPA) scheme
the cost is decreased with reference to the approved as the network has been
extended year by year, hence actual average cost per Ag. Wells has been
decreased even though physically 100 % Agriculture well target was completed
by the UGVCL during FY 2017-18. Application registered under dark zone scheme
under dark zone area was pending since 1990 due to Ban in agriculture connection
in Dark Zone area. Government of Gujarat has lifted the ban for Dark Zone area
vide latter no ELC/2012/773/K1/708 dated 12.04.2012. Accordingly UGVCL has
processed all pending application as per the guidelines issued for the scheme.
Company has released 13136 Nos. of Ag conn. in Dark Zone Scheme from the
year 2012-13 and cleared all the old pending applications. At present status there
is no pending application registered up to 31.12.2015 at UGVCL level.

6. SCADA/DMS Project: SCADA/DMS helps in achieving the objective of supply of

quality power, faster identification of faults & early restoration of power, proper
metering, strategic placement of capacitor banks & switches and proper planning
& designing of distribution networks and the real time monitoring & control of the
distribution system. SCADA/DMS project is being implemented in Ahmedabad
Peri area. Total loan of Rs. 33.82 Crore is sanctioned under Part A of RAPDRP
and covers all distribution substations under the project area & 11kV urban feeder
network. For deriving maximum benefits, it is essential that necessary up
gradation of distribution Substation & 11/22 kV network is being carried out to meet
the SCADA/DMS requirements. M/s Chemtrols India Ltd is selected as SIA for all
Gujarat DISCOMs. M/s Chemtrols was issued order by UGVCL on 1st April, 2013.
At present installation of FRTUs are under progress. The actual cost incurred is
Rs. 7.54 Crore (R-APDRP Part-A plus SCADA and other I.T. expenditure) against
approved cost of Rs. 0.21 Crore. the PO was awarded in Apr-13, but the SCADA
implementation work for substation depend upon the GETCO support and also on
the installation, commissioning and testing work of RMUs and associated H.T.
infrastructure work such as underground cable work as well as the said SCADA
project work involves high techno skill and being as first project, hence there is a
dependence on the SCADA implementing agency. So, work has been carried out

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during 2017-18. Further, payment shall be made to M/s Chemtrols based on the
achievement of the milestones of this turnkey project.

7. Smart Grid Project: The broad scope of the pilot project is (1) AT&C Loss
Reduction (2) Peak Load Management, (3) AMI for Industrial, commercial &
residential consumers, (4) Outage Management and (5) Demand Side
Management and Demand Response and ToU tariff for consumers. The PO was
awarded to M/s Genus power in June-17. M/s Genus has started activity like site
survey, consumer details gathering after 3 months and mobilization advance has
been given to M/s Genus in Dec-17. The actual cost incurred is Rs. 3.46 Crore
against approved cost of Rs. 14.00 Crore. The timeline for completion of the
project is 18 months and M/s Genus has started hardware and meter purchasing
after Apr-18. So only Rs. 3.46 Crore has been expend during 2017-18. At present,
total 20358 single phase and 2021 three phase meters are installed. Control room
hardwares are installed and only MDM software application work is in process.

8. High Voltage Distribution System (HVDS): The Company is having large nos.
of Low Tension category consumers. To eliminate low voltage distribution and to
have better voltage profile as well as for reduction of technical loss and associated
commercial loss, the Company has proposed to shift over on High Voltage
Distribution System by erecting small capacity transformers matching with the
connected load of individual consumer or very small group of consumers in a
phased manner. The Company has started to do some of the work on its own. The
Company is desirous to implement HVDS scheme in its distribution area and shall
endeavour to achieve the approved target. The cost is decreased with reference
to the approved due to as the L.T. network has been reduced year by year.

9. Solar Water Pumping: Government of Gujarat has introduced solar pumping

system. In this scheme agriculture application registered under general scheme,
TASP scheme, Dark zone scheme can be switched over into solar water
agriculture pumping scheme. Agriculture application registered up to 3.0 HP , 5.0
HP and 7.5 HP can be switched over into solar scheme. This scheme is turnkey
base scheme. There are 475 Nos. of solar pump installation work carried out
during FY 2017-18. During FY 2017-18, Rs. 22.65 Crore expenditure has been
incurred.

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10. Demand Side Management: Government of Gujarat has been started domestic
efficient lighting programme. This programme is implemented by EESL at Gujarat
to provide energy efficient 9W LED lighting for grid connected consumers in the
state of Gujarat on 26.05.2016 for General Lighting Purpose (GLP), Manufacturing
and Service Industries (MSI) and Residential Category consumers of DISCOM in
the entire operational area after approval of Hon'ble Commission. At present Up
to March-2018, Total 79.50 lacs of 9W LED bulb have been sold in UGVCL
licensee area. The claim may be raised by EESL during this Year. The combo
project of replacement of 50W five star rated energy efficient fan and 20W LED
tube light has been started by Government of Gujarat for grid connected
consumers in the state of Gujarat on 26.01.2017. Hence UGVCL has projected 2
Crore, for F.Y. 2019-20 and F.Y. 2020-21. This programme is also implemented
by EESL at Gujarat. At present Up to March-2018, Total 2.65 lacs of 20W LED
tube light and 1.62 lac of 50W five star rated energy efficient fan has been sold in
UGVCL licensee area. No any ongoing Project at present in this activity, but
expenditure is done as per Invoice received from EESL of “UJALA Gujarat”
project, hence total approved amount is not used.

11. Din Dayal Upadhyay Gramin Jyoti Yojna (DDUGJY): It is to state that, under
this scheme various activities were covered like New Feeder / Feeder Bifurcation,
LT Line Augmentation, Aerial Bunch Cables, Consumer Meter Replacement, New
Connections, HVDS etc. DPR was submitted in March – 2015 based on the SOR
rate which was approved in May – 2016. Funding mechanism for the said scheme
is 60% grant from REC and 40% from own fund. Hence, considering the same,
Capital Expenditure was proposed. Further, for the proposed work, tenderization
process done by respective field offices and letter of award given to contractors.
Based on the actual labour and supply rate expenditure was booked, which was
less than the proposed rate of DPR. Hence, actual capital expenditure is
decreased from Rs. 60.00 Crore to Rs. 43.65 Crore due to actual execution of
work based on the rates of supply and labour work orders, even though progress
of scheme was 72%.

12. Integrated Power Development Scheme (IPDS): It is to state that, under this
scheme various activities were covered like New Feeder / Feeder Bifurcation,
Underground Cable work, Distribution Transformers, LT Line Augmentation, Aerial
Bunch Cables, Consumer Meter Replacement, New Connections, HVDS etc. DPR

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was submitted in February – 2015 based on the SOR rate which was approved in
Mar – 2016. Funding mechanism for the said scheme is 60% grant from REC and
40% from own fund. Hence, considering the same, Capital Expenditure was
proposed. Further, for the proposed work, tenderization process done by
respective field offices and letter of award given to contractors. Based on the
actual labour and supply rate expenditure was booked, which was less than the
proposed rate of DPR. Further, for the partial turnkey work of overhead to
underground network electrification work, AT was issued in June-18 which covers
work of almost Rs. 27.0 Crore. Hence, actual capital expenditure is decreased
from Rs. 51.00 Crore to Rs. 40.77 Crore due to actual execution of work based on
the rates of supply and labour work orders, even though progress of scheme was
62%.

Commission’s Analysis

The capital expenditure approved in MYT Order dated 31st March, 2017 for FY 2017-
18 is Rs. 784.43 Crore. The actual capital expenditure incurred is Rs. 629.31 Crore,
which is lower by Rs. 155.12 Crore than the CAPEX approved in the MYT Order dated
31st March 2017.
The Commission observed that there is good growth in terms of number of consumers
and load and therefore there is an increase in expenditure under the Normal
Development scheme as compared to the amount approved in the MYT, the company
incurred Rs. 241.70 Crore as against 175.00 Crore approved. In the underground cable
work as the necessary DPR was not approved there was no expenditure. Further it is
observed that in IPDS and DDUGJY capital expenditure was less than the planned
expenditure by Rs. 10.23 Crore and Rs. 16.35 Crore respectively. UGVCL submitted
that very little work like capital expenditure on replacement of single phase meters and
SMC box replacements was carried and as a result capex booking against projection
is less.
The Commission further observed that actual expenditure was less than the target
expenditure as work performed in schemes like HVDS in selected s/dn and TAPS
(Wells) was less than targeted work. UGVCL has submitted that expenditure under
electrification of hutments and kutirjyoti scheme was Rs. 12.21 Crore and Rs. 59.25
Crore respectively.
The Commission also looked at ‘Dark Zone ‘ scheme and observed that expenditure
under this scheme was Rs. 90.18 Crore as compared to approved expenditure of Rs.

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150.00 Crore, the actual average cost per Ag well is decreased even though physically
100% Agriculture well target was completed.
The Commission also observed that UGVCL has incurred capital expenditure under
Scheme for Solar Pumps and DSM.
The Commission further observed that most of the capital expenditure schemes by the
DISCOMs are of continuous and on-going nature. These are based on yearly targets
set for meeting the supply obligation, providing quality and reliable power to the
consumers, reduction in losses, release of agriculture connections, etc. Generally,
there are no pre-defined timelines as the schemes are further bifurcated into various
works under the scheme. Nevertheless, the licensee shall be more realistic in
projecting the capital expenditure.
The Commission, verified the audited annual accounts of UGVCL and has
observed that UGVCL has incurred actual capital expenditure of Rs. 629.31
Crore and the capitalisation of Rs. 672.04 Crore. The Commission, therefore
approves the same in the truing up for FY 2017-18.

4.6.2.1 Funding of Capex

Petitioner’s Submission
The funding of actual capitalisation is done through various sources categorised under
four headings namely: Consumer Contribution, Grants, Equity and Debt. The detailed
breakup of funding of capitalised asset during FY 2017-18 is given in the Table below:

Table 4-26: Proposed Capitalisation and sources of funding by UGVCL for FY 2017-18
(Rs. Crore)
Approved for Claimed in
Sr.
Schemes 2017-18 in MYT truing up for
No.
Order 2017-18
1 Capitalization 784.43 672.04
2 Less: Consumer Contribution 89.95 117.84
3 Less: Grants 277.10 33.36
4 Balance CAPEX 417.38 520.84
5 Debt @ 70% 292.17 364.59
6 Equity @ 30% 125.21 156.25

Commission’s Analysis
It is observed that UGVCL has claimed the funding of Capitalization net of Consumer
Contribution and Govt. Grant through mix of Debt and Equity by observing the 70:30
ratio as provided in the GERC (MYT) Regulations, 2016.

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The Commission has noted that under Government Grants and Consumer
Contribution MGVCL has considered Rs. 33.36 Crore and Rs. 117.84 Crore
respectively, which are in conformity with audited annual accounts for FY 2017-18.
The CAPEX, therefore, approves the funding of Capitalization as given in the Table
below:

Table 4-27: Approved Capitalisation and sources of funding in the truing up for FY
2017-18
(Rs. Crore)
Approved in Actual Approved
Sr.
Schemes the MYT Claimed in for Truing
No.
Order Truing up up
1 Capex 784.43 629.31 629.31
2 Capitalization 784.43 672.04 672.04
3 Less: Consumer Contribution 89.95 117.84 117.84
4 Less: Grants 277.10 33.36 33.36
5 Balance Capitalization 417.38 520.84 520.84
6 Debt @ 70% 292.17 364.59 364.59
7 Equity @ 30% 125.21 156.25 156.25

4.6.3 Depreciation
UGVCL has claimed Rs. 262.25 Crore towards depreciation in the truing up for FY
2017-18 against the depreciation of Rs. 331.74 Crore approved in the MYT Order
dated 31st March, 2017.

Petitioner’s submission
The Petitioner submitted that it had been charging the Depreciation on the fixed assets
of the Company, on the useful life of the assets at the rates prescribed under Schedule
XIV to the Companies Act, 1956. The Company being engaged in the business of
Electricity Distribution, the provisions of the Electricity Act, 2003 would be applicable
and would supersede the provisions of the Companies Act, 2013.
While claiming Depreciation UGVCL has quoted the provisions of the GERC (MYT)
Regulations, 2016 and the directives given by the Commission in the MYT Order dated
31st March, 2017 as given hereunder:-

In case of Depreciation, the MYT Regulations, 2016 provides that-

“Depreciation shall be computed annually based on the straight line method at the
rates specified in the Annexure I to these Regulations:
Provided that the remaining depreciable value as on 31st March of the year closing
after a period of 12 years from date of commercial operation shall be spread over the
balance useful life of the assets:
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Provided further that for a Generating Company or a Transmission Licensee or SLDC

or a Distribution Licensee formed as a result of a Transfer Scheme, the depreciation
on assets transferred under the Transfer Scheme shall be charged as per rates
specified in these Regulations for a period of 12 years from the date of Transfer
Scheme, and thereafter depreciation will be spread over the balance useful life of the
assets”

MYT Order dated 31st March, 2017:

“The petitioner came into existence through Transfer Scheme of the State Government
effective from 1st April 2005 and the period of 12 years is getting completed on
31.03.2017. Accordingly, the petitioner is required to consider depreciation for the FY
2017-18 in accordance with the MYT Regulations, 2016 as stated above. At present
the Commission has considered the depreciation charges as projected by the
petitioner for the MYT Control Period, but the petitioner is required to book depreciation
charges in accordance with the MYT Regulations. The Commission will consider and
allow depreciation charges for FY 2017-18 in accordance with the MYT Regulations,
2016.”

Accordingly, UGVCL has calculated depreciation for FY 2017-18 in accordance with

the provisions of the MYT Regulations, 2016 and the aforementioned directives of the
Hon’ble Commission:

Table 4-28: Fixed assets & depreciation computed by UGVCL for FY 2017-18
(Rs. Crore)
Sr. Approved in Actual Claimed
Particulars
No. MYT Order in Truing up
1 Gross Block at the Beginning of the year 6019.33 4223.75
2 Additions during the Year (Net) 784.43 672.04
3 Depreciation for the Year 331.74 262.25
4 Average Rate of Depreciation 5.17% 5.75%

UGVCL has further submitted that actual depreciation for FY 2017-18, as against the
value approved in the MYT, resulted in a net uncontrollable gain of Rs. 69.49 Crore as
shown in the Table below:

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Table 4-29: Gain / Loss due to deprecation claimed in the truing up for FY 2017-18
(Rs. Crore)
Gain/(Loss) Gain/(Loss) due
Approved Actual
due to to
Particulars in MYT Claimed in
Controllable Uncontrollable
Order Truing up
Factors Factors
Depreciation 331.74 262.25 69.49

Commission’s Analysis

It is observed that the Petitioner has taken Opening GFA as per Audited accounts
which is readjusted as per Ind AS. However, the Commission has considered the
Opening Balance of GFA as per last true up for FY 2016-17 and accordingly the
Closing Balance of GFA as on 31.03.2017 has been considered as Opening Balance
of GFA as on 1.04.2017.
The net addition during the year of Rs. 672.04 Crore is confirmed from the audited
annual accounts for FY 2017-18. The depreciation as per P&L Account for FY 2017-
18 is Rs. 262.25 Crore.
The Commission, accordingly, approves Depreciation at Rs. 262.25 Crore in the
truing up for FY 2017-18 as shown in the Table below:

Table 4-30: Approved fixed assets & depreciation for FY 2017-18

(Rs. Crore)
Sr. Approved in Approved in
Particulars
No. the MYT Order truing up
1 Gross Block at the Beginning of the year 6019.33 5680.50
2 Additions during the Year (Net) 784.43 672.04
3 Gross Block at the end of the year 6803.76 6352.54
4 Depreciation for the Year 331.74 262.25
5 Average Rate of Depreciation 5.17% 4.36%

The amount of depreciation is dependent on the quantum of capitalisation, rate of

depreciation, etc. The Commission has, therefore, considered the parameters
impacting depreciation as uncontrollable.
The Commission, accordingly, approves the Gain / Loss on account of depreciation in
the truing up for FY 2017-18, as detailed in the Table below:

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Table 4-31: Gain / Loss due to Depreciation approved in the truing up for FY 2017-18
(Rs. Crore)
Gain/(Loss) Gain/(Loss)
Approved Approved
due to due to
Particulars in the MYT in truing
Controllabl Uncontrollable
Order up
e Factors Factors
Depreciation 331.74 262.25 69.49

4.6.4 Interest and Finance charges

UGVCL has claimed Rs.127.71 Crore towards interest and finance charges in the
truing up for FY 2017-18, as against Rs.136.61 Crore approved in the MYT Order dated
31st March, 2017 as shown in the Table below:

Table 4-32: Interest and Finance Charges claimed by UGVCL in the truing up for FY
2017-18
(Rs. Crore)
Approved in the Actual Claimed
Particulars Deviation
MYT Order in Truing up
Interest and Finance Charges 136.61 127.71 8.90

Petitioners’ submission

UGVCL has submitted that for assessing the actual Interest charges on loans in FY
2017-18, they have considered Opening Balance of loans for FY 2017-18 same as the
Closing Balance of Loans approved by the Commission for FY 2016-17 in the Tariff
Order dated 31st March, 2018. The loan addition in FY 2017-18 is computed at Rs.
364.59 Crore towards funding of CAPEX for FY 2017-18. As per the GERC (MYT)
Regulations, 2016 repayment during the year has been considered equal to the
depreciation for the financial year.
UGVCL has considered the weighted average rate of interest of 8.54% as against
7.27% approved in the MYT Order dated 31st March, 2017 for FY 2017-18.
In addition to the above, UGVCL has considered the interest on security deposits as
per the provisions of the GERC (MYT) Regulations, 2016. The details of interest and
finance charges claimed by UGVCL are as given in the Table below:

Table 4-33: Interest and Finance Charges claimed by UGVCL in the truing up for FY
2017-18
(Rs. Crore)
Approved Actual
Sr.
Particulars in the MYT Claimed in Deviation
No.
Order Truing up
1 Opening Loans 603.62 560.29
2 Additions during the year 292.17 364.59

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Approved Actual
Sr.
Particulars in the MYT Claimed in Deviation
No.
Order Truing up
3 Repayment during the year 331.74 262.25
4 Closing Loans 564.05 662.63
5 Average Loans 583.84 611.46
6 Interest on Loan 42.44 52.23 (9.79)
7 Interest on Security Deposit 93.33 75.48 17.85
8 Guarantee Charges 0.83 - 0.83
9 Total Interest & Finance Charges 136.61 127.71 8.89
10 Weighted Average Rate of Interest 7.27% 8.54%

UGVCL has further submitted that interest and finance charges are categorised as
uncontrollable as per the GERC (MYT) Regulations, 2016 and accordingly worked out
deviation in the actual vis-à-vis the approved expenses under uncontrollable factors,
as given in the Table below:

Table 4-34: Gain / (Loss) claimed due to Interest & Finance Charges for FY 2017-18
(Rs. Crore)
Gain/(Loss Gain/(Loss) due
Approved Actual
) due to to
Particulars in the MYT Claimed in
Controllab Uncontrollable
Order Truing up
le Factors Factors
Interest and Finance
136.61 127.71 8.90
Charges

Commission’s Analysis

The Commission observed that the Closing Balance of Loans approved in true up
Order for FY 2016-17 is Rs. 560.29 Crore and the same has to be taken as the Opening
Loans Balance for FY 2017-18.
The capitalisation and funding of CAPEX have been approved for FY 2017-18, as per
Table 4.27 of this Order.
The normative addition of loans during FY 2017-18 has been considered at Rs. 364.59
Crore as approved in Table 4.27 of this Order. The interest on security deposits of Rs.
75.48 Crore is as per audited accounts for FY 2017-18.
The repayment of loan is Rs. 262.25 Crore in the truing up for FY 2017-18, which is
equivalent to the depreciation, approved in Table 4.30 of this Order. The guarantee
charges and other finance charges, as per audited accounts for FY 2017-18 are Rs.
Nil.
UGVCL has submitted details of the actual loan portfolio and the rate of interest
applicable for each loan portfolio for FY 2017-18. The Commission has worked out the

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weighted average rate of interest as 9.96% in accordance with the Regulation 38 of

the GERC (MYT) Regulations, 2016.
Taking all these factors into consideration, the interest and finance charges have been
computed as detailed in the Table below:

Table 4-35: Interest and Finance Charges approved by the Commission in the truing up
for FY 2017-18
(Rs. Crore)
Sr. Approved in the MYT Approved in Truing
Particulars
No. Order up
1 Opening Loans 603.62 560.29
2 Additions during the year 292.17 364.59
3 Repayments during the year 331.74 262.25
4 Closing Loans 564.04 662.63
5 Average Loans 583.84 611.46
6 Interest on Loan 42.44 60.92
7 Interest on Security Deposit 93.33 75.48
8 Guarantee Charges 0.83 -
9 Total Interest & Finance Charges 136.60 136.40
10 Weighted Average Rate of Interest 7.27% 9.96%

The Commission, accordingly, approves the interest and finance charges at Rs. 136.40
Crore in the truing up for FY 2017-18.

As per the GERC (MYT) Regulations, 2016, the Commission is of the view that the
parameters which impact interest and finance charges should be treated as
uncontrollable. The Commission, accordingly, approves the Gain / Loss on account of
interest and finance charges in the truing up for FY 2017-18, as detailed in the Table
below:

Table 4-36: Gain / (Loss) approved in the truing up for FY 2017-18

(Rs. Crore)
Gain/(Loss)
Approved Approved
due to
Particulars in the MYT in Truing Deviation
Uncontrollab
Order up
le Factors
Interest and Finance charges 136.60 136.40 0.21

4.6.5 Interest on Working Capital

UGVCL has not claimed any interest on working capital in the truing up for FY 2017-
18, against Nil provision approved in the MYT Order dated 31st March, 2017 as detailed
in the Table below:

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Table 4-37: Interest on Working Capital claimed by UGVCL in the truing up for FY
2017-18
(Rs. Crore)
Approved in the Actual Claimed in
Particulars
MYT Order Truing up
Interest on Working Capital - -

Petitioner’s submission

UGVCL has submitted that working capital has been calculated and the rate of interest
is considered as the rate equal to the weighted average of the 1 year MCLR of State
Bank of India during the year plus 250 basis points, as per the GERC (MYT)
Regulations, 2016. This rate works out to 10.50%.
The detailed computation of Working Capital requirement as per the provisions of the
GERC (MYT) Regulations, 2016 and interest on working capital is as given in the Table
below:

Table 4-38: Interest on working capital claimed by UGVCL in the truing up for FY
2017-18
(Rs. Crore)
Approved Actual
Sr.
Particulars in the MYT Claimed in
No.
Order Truing up
1 O&M Expenses 36.92 52.00
2 Maintenance Spares 60.19 42.00
3 Receivables 816.28 827.00
4 Less: Amount held as Security Deposit from Consumers 1,204.28 1,200.00
5 Total Working Capital (290.89) (279.00)
6 Rate of Interest on Working Capital 11.70% 10.50%
7 Interest on Working Capital - -

Commission’s Analysis

The Commission has examined the computation of normative working capital under
the GERC (MYT) Regulations, 2016. The working capital requirement works out to be
negative during FY 2017-18. As the working capital requirement works out to be
negative, there cannot be any interest on working capital. Accordingly, neither any
interest is claimed by UGVCL nor any interest is approved by the Commission.
The detailed computation of the Working Capital and interest thereon is given in the
Table below:

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Table 4-39: Interest on working capital approved in the truing up for FY 2017-18
(Rs. Crore)
Actual Approved
Sr.
Particulars Claimed in in Truing
No.
Truing up up
1 O&M Expenses 52.00 51.94
2 Maintenance Spares 42.00 56.81
3 Receivables 827.00 827.40
4 Less: Amount held as Security Deposit from Consumers 1,200.00 1,200.10
5 Total Working Capital (279.00) (263.95)
6 Rate of Interest on Working Capital 10.50% 10.50%
7 Interest on Working Capital - -

The Commission, accordingly, approves the interest on working capital as Nil in the
truing up for FY 2017-18.

4.6.6 Bad Debts Written Off

UGVCL has claimed Rs. 0.31 Crore towards bad debts written off in the truing up for
FY 2017-18, as against Rs. 0.70 Crore approved in the MYT dated 31st March 2017 as
given in the Table below:

Table 4-40: Bad Debts claimed by UGVCL in the truing up for FY 2017-18
(Rs. Crore)
Sr. Approved in the Actual Claimed in
Particulars
No. MYT Order Truing up
1 Bad Debts Written Off 0.70 0.31

Petitioner’s submission
UGVCL submitted that comparison of the actual Bad Debts Written Off with the amount
approved in the MYT Order dated 31st March, 2017 resulted in a gain of Rs. 0.39 Crore
on account of controllable factors, as shown in the Table below:

Table 4-41: Bad Debts Written Off for FY 2017-18

(Rs. Crore)
Actual Gain/(Loss) Gain/(Loss)
Approved
Sr. Claimed due to due to
Particulars in the MTR
No. in Truing Controllable Uncontrollab
Order
up Factors le Factors
1 Bad Debts Written Off 0.70 0.31 0.39

Commission’s Analysis

The Commission has observed that UGVCL has claimed Rs. 0.31 Crore towards Bad
& Doubtful Debts Written off during FY 2017-18.

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The Commission verified from the audited annual accounts that UGVCL has made a
provision of Rs. 7.18 Crore for bad debts and has also written off Rs. 0.31 Crore
towards Bad & Doubtful Debts. Regulation 94.9 of the GERC (MYT) Regulations, 2016
specifies that the Commission may allow bad debts written off as a pass through in the
aggregate revenue requirement subject to prudence check. The Commission notes
that the Provision for Bad & Doubtful Debts is towards the future write offs and
accordingly, the actual write offs only are considered as a pass through in the ARR as
per the GERC (MYT) Regulations, 2016.
The Commission, therefore, approves Rs. 0.31 Crore towards bad and doubtful debts
written off in the truing up for FY 2017-18.
The deviation on account of bad debts written off is Rs. 0.39 Crore and the Commission
considers the same as gain due to controllable factors, as detailed in the Table below:

Table 4-42: Gain/ (Loss)due to Bad Debts approved in the Truing up for FY 2017-18
(Rs. Crore)
Gain/(Loss
Gain/(Loss)
Approved Approved ) due to
Sr. due to
Particulars in the MYT in Truing Uncontroll
No. Controllable
Order up able
Factors
Factors
1 Bad Debts Written Off 0.70 0.31 0.39

4.6.7 Return on Equity

UGVCL has claimed Rs. 179.73 Crore towards return on equity in the truing up for FY
2017-18 as against Rs. 181.11 Crore approved in the MYT Order dated 31st March
2017, as given in the Table below:

Table 4-43: Return on Equity claimed by UGVCL in the truing up for FY 2017-18
(Rs. Crore)
Approved in the Actual Claimed in
Particulars
MYT Order Truing up
Return on Equity 181.11 179.73

Petitioner’s submission
UGVCL has computed return on equity considering the rate of 14% on the average of
opening and closing equity, taking into account the additions during the year as given
in the Table below:

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Table 4-44: Return on Equity claimed by UGVCL in the truing up for FY 2017-18
(Rs. Crore)
Sr. Approved in the Actual Claimed
Particulars
No. MYT Order in Truing up
1 Opening Equity 1231.02 1205.68
2 Additions during the year 125.21 156.25
3 Closing Equity 1356.23 1361.93
4 Average Equity 1293.63 1283.81
5 Rate of Return on the Equity 14% 14%
6 Return on Equity 181.11 179.73

Commission’s analysis

UGVCL has furnished the Opening Equity of Rs. 1205.68 Crore for FY 2017-18 and
submitted Equity addition as Rs. 156.25 Crore during FY 2017-18. The actual Opening
Equity as on 01.04.2017 was Rs. 1205.68 Crore being the Closing Balance of Equity
approved in the True Up for FY 2016-17.The Commission has approved the normative
Equity addition of Rs. 156.25 Crore in Table 4.27 of this Order
The Commission has computed the Return on Equity in the truing up for FY 2017-18
considering the rate of 14% as provided in the GERC (MYT) Regulations, 2016 as
detailed in the Table below:

Table 4-45: Return on Equity approved for FY 2017-18

(Rs. Crore)
Sr. Actual Claimed in Approved in Truing
Particulars
No. Truing up up
1 Opening Equity 1205.68 1205.68
2 Additions during the year 156.25 156.25
3 Closing Equity 1361.93 1361.93
4 Average Equity 1283.81 1283.81
5 Rate of Return on Equity 14.00% 14.00%
6 Return on Equity 179.73 179.73

The Commission approves the Return on Equity at Rs. 179.73 Crore in the truing
up for FY 2017-18.

It is considered that deviation is due to uncontrollable factors as the return on equity is

being allowed on a normative basis and the quantum of equity addition in the year
depends upon the capital expenditure and the capitalization achieved during the year.
As mentioned in the GERC (MYT) Regulations, 2016, the factors impacting the Return
on Equity are considered uncontrollable. The Commission, accordingly, approves the
Gain and Loss, on account of Return on Equity, in the Truing up for FY 2017-18 as
uncontrollable.
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The Commission, accordingly, approves the Gain / Loss on account of Return on

Equity in the truing up for FY 2017-18, as detailed in the Table below:

Table 4-46: Approved Gain / Loss due to Return on Equity in the truing up for FY
2017-18
(Rs. Crore)
Gain/(Loss) Gain / (Loss)
Approved Approved
due to due to Un
Particulars in the MYT in Truing
Controllable controllable
Order up
Factors Factors
Return on Equity 181.11 179.73 0 1.37

4.6.8 Taxes
UGVCL has claimed Rs. 14.38 Crore towards income tax for FY 2017-18, as against
Rs. 17.14 Crore approved in the MYT Order dated 31st March, 2017, as given in the
Table below:

Table 4-47: Taxes claimed by UGVCL in the truing up for FY 2017-18

(Rs. Crore)
Approved in the MYT Actual Claimed in
Particulars
Order Truing up
Income Tax (MAT) 17.14 14.38

Petitioner’s submission

UGVCL has submitted that income tax being a statutory expense, any variation on this
account is uncontrollable. UGVCL has claimed a gain of Rs. 2.76 Crore on this
account, as given in the Table below:

Table 4-48: Gain / (Loss) claimed due to provision for taxes for FY 2017-18
(Rs. Crore)
Approved Actual Gain /(Loss) Gain / (Loss)
in the Claimed due to due to Un
Particulars
MYT in Truing Controllable Uncontrollable
Order up Factors Factors
Income Tax (MAT) 17.14 14.38 2.76

Commission’s Analysis

The Commission has obtained the copies of the Challans of Tax payer’s counterfoil,
26 AS and also verified from the audited annual accounts of the company and found
that the licensee has paid/provided income tax of Rs. 14.38 Crore.

The Commission, accordingly, approves the Income Tax of Rs. 14.38 Crore in the
truing up for FY 2017-18.

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With regard to the computation of Gain/(Loss), Regulation 22 of the GERC(MYT)

Regulations, 2016 considers variation in taxes on income as uncontrollable. The
Commission, accordingly, approves the Gain/(Loss)on account of tax on income in the
truing up for FY 2017-18, as detailed in the Table below:

Table 4-49: Approved Gain / Loss due to tax in the truing up for FY 2017-18
(Rs. Crore)
Approved Gain /(Loss) Gain / (Loss)
Approved
in the due to due to
Particulars in Truing
MYT Controllable Uncontrollable
up
Order Factors Factors
Tax on Income 17.14 14.38 2.76

4.6.9 Non-Tariff Income

UGVCL has claimed the actual Non-Tariff Income at Rs.138.68 Crore in the truing up
for FY 2017-18, as against Rs. 146.76 Crore approved in the MYT Order dated 31st
March 2017, as detailed in the Table below:

Table 4-50: Non-Tariff Income claimed by UGVCL in the truing up for FY 2017-18
(Rs. Crore)
Approved in the MYT Actual Claimed in
Particulars
Order Truing up
Non-Tariff Income 146.76 138.68

Petitioner’s submission
The Petitioner has Claimed the actual Non-Tariff Income of Rs. 138.68 Crore, as
against Rs. 146.76 Crore approved in the MYT Order dated 31st March, 2017. This has
resulted in a uncontrollable gain of Rs. 8.08 Crore, as detailed in the Table below:

Table 4-51: Gain / (Loss) claimed due to Non-Tariff Income for FY 2017-18
(Rs. Crore)
Actual Gain /(Loss) Gain / (Loss)
Approved
Claimed due to due to Un
Particulars in the MYT
in Truing Controllable Uncontrollable
Order
up Factors Factors
Non-Tariff income 146.76 138.68 8.08

Commission’s Analysis
The Commission observed that as per audited annual accounts the Non-Tariff Income
is Rs. 139.78 Crore which includes interest on staff loans (Rs. 1.10 Crore) for FY 2017-
18.

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The Commission, approves the Non-Tariff Income at Rs. 138.68 Crore after negating
the interest on staff loan of Rs. 1.10 Crore in the truing up for FY 2017-18.
The deviation in non-tariff income is considered as uncontrollable. The Commission,
accordingly, approves the Gain / losses on account of non-tariff income in the truing
up for FY 2017-18, as detailed in the Table below:

Table 4-52: Approved Gain / losses due to Non-Tariff Income in the truing up for FY
2017-18
(Rs. Crore)
Gain
Approved Gain / (Loss)
Approve /(Loss)
in the due to Un
Particulars d in due to
MYT Uncontrollable
Truing up Controllab
Order Factors
le Factors
Non-Tariff income 146.76 138.68 8.08

4.7 Revenue from Sale of Power

UGVCL has claimed the total revenue of Rs. 9928.81 Crore in the truing up for FY
2017-18 as against Rs. 9795.42 Crore approved in the MYT Order dated 31st March,
2017 as detailed in the Table below:

Table 4-53: Revenue submitted in the truing up for FY 2017-18

(Rs. Crore)
Sr. Approved in Actual Claimed
Particulars
No. the MYT Order in Truing up
1 Revenue from Sale of Power 9007.01 9129.81
2 Other Income (Consumer related) 252.35 256.74
3 Total Revenue excluding subsidy (1+2) 9259.36 9386.55
4 Agriculture Subsidy 536.06 542.26
5 Total Revenue including subsidy (3+4) 9795.42 9928.81

Commission’s Analysis

The Commission has verified the total revenue for FY 2017-18 from the audited
accounts. The actual revenue from category-wise sales, as per audited accounts, is
Rs. 9311.51 Crore. This includes the revenue from sale of power to GUVNL of Rs.
87.55 Crore and DSM charges Income of Rs. 94.16 Crore. Since these have been
adjusted against the power purchase cost for the FY 2017-18, as shown in Table 4.9
of this Order, the net revenue from sale of power works out to Rs. 9129.81 Crore.
It is further observed that other operating income as per audited annual accounts is
Rs. 825.49 Crore, which includes Rs. 26.49 Crore towards Delayed Payment Charges

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and Rs. 542.26 Crore towards Agriculture Subsidy. After excluding these two
elements, the other consumer related income works out to of Rs. 256.74 Crore
The Commission has considered Agriculture Subsidy separately while Delayed
Payment Charges Income and Delayed Payment Charges Expenditure are not
considered as per the GERC (MYT) Regulations, 2016.

The aforesaid Agriculture Subsidy has been claimed as a separate item of revenue.

Table 4-54: Revenue approved in the truing up for FY 2017-18

(Rs. Crore)
Sr. Actual Claimed Approved in
Particulars
No. in Truing up Truing up
1 Revenue from Sale of Power 9129.81 9129.81
2 Other income (Consumer related) 256.74 256.74
3 Total revenue excluding subsidy (1+2) 9386.55 9386.55
4 Agriculture Subsidy 542.26 542.26
5 Total revenue including subsidy (3+4) 9928.81 9928.81

The Commission, accordingly, approves the total revenue of Rs. 9928.81 Crore,
including consumer related income of Rs. 256.74 Crore and Agriculture Subsidy
of Rs. 542.26 Crore in the truing up for FY 2017-18.

4.8 ARR approved in the truing up

The Commission reviewed the performance of UGVCL under Regulation 21 of the
GERC (MYT) Regulations, 2016, with reference to the audited accounts for FY 2017-
18. The Commission computed the Gain/(Loss)for FY 2017-18, based on the truing up
for each of the component discussed in the above paragraphs.
The Aggregate Revenue Requirement (ARR) approved in the MYT Order dated 31st
March 2017, actual claimed in truing up and approved for truing up and
Gain/(Loss)computed in accordance with the GERC (MYT) Regulations, 2016 are
given in the Table below:

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Table 4-55: ARR approved in truing up for FY 2017-18

(Rs. Crore)
Gain /
Gain /
(Loss)
Approv Approve (Loss)
Actual due to
Sr. Annual Revenue ed in d in Deviation due to
Claimed in Contro
No. Requirement the MYT Truing +/(-) Uncontr
Truing up llable
Order up ollable
Factor
Factors
s
1 2 3 4 5 6=(3-5) 7 8
Cost of Power
1 8866.95 9004.23 9004.23 (137.28) 150.64 (287.92)
Purchase
2 O&M Expenses 443.05 623.31 623.31
2.1 Employee Cost 423.58 531.92 531.92 (108.34) (82.56) (25.78)
Repairs &
2.2 Maintenance 88.50 61.36 61.36 27.14 27.14
Expenses
Administration &
2.3 75.69 99.22 99.22 (23.53) (23.53)
General Expenses
2.4 Other Debits - - - - -
Other Expenses
2.5 (144.72) (69.19) (69.19) (75.53) (75.53)
Capitalised
3 Depreciation 331.74 262.25 262.25 69.49 - 69.49
Interest and
4 136.61 127.71 136.40 0.21 - 0.21
Finance Charges
Interest on working
5 - - - - -
capital
Bad Debts Written
6 0.70 0.31 0.31 0.39 0.39
Off
7 Return on Equity 181.11 179.73 179.73 1.38 - 1.38
Provision for Tax /
8 17.14 14.38 14.38 2.76 - 2.76
Tax paid
Total Expenditure
9 9977.30 10211.92 10220.61 (243.31) 72.08 (315.39)
(1 to 8)
Less: Non -Tariff
10 146.76 138.68 138.68 8.08 - 8.08
income
Aggregate
11 Revenue 9830.54 10073.24 10081.93 (251.39) 72.08 (323.47)
Requirement

4.9 Sharing of Gain / Loss for FY 2017-18

The Commission has analyzed the Gain / (Loss)on account of controllable and
uncontrollable factors. The relevant Regulations are extracted below
“Regulation 23. Mechanism for pass-through of Gain or Loss on account of
uncontrollable factors

23.1 The approved aggregate gain or loss to the Generating Company or Transmission
Licensee or SLDC or Distribution Licensee on account of uncontrollable factors shall
be passed through as an adjustment in the tariff of the Generating Company or
Transmission Licensee or SLDC or Distribution Licensee over such period as may be
specified in the Order of the Commission passed under these Regulations.

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23.2 The Generating Company or Transmission Licensee or SLDC or Distribution

Licensee shall submit such details of the variation between expenses incurred and
revenue earned and the figures approved by the Commission, in the prescribed format
to the Commission, along with the detailed computations and supporting documents
as may be required for verification by the Commission.

23.3 Nothing contained in this Regulation 23shall apply in respect of any gain or loss
arising out of variations in the price of fuel and power purchase, which shall be dealt
with as specified by the Commission from time to time.
Regulation 24. Mechanism for sharing of Gain or Loss on account of controllable
factors

24.1The approved aggregate gain to the Generating Company or Transmission

Licensee or SLDC or Distribution Licensee on account of controllable factors shall be
dealt with in the following manner:
(a) One-third of the amount of such gain shall be passed on as a rebate in tariffs over
such period as may be stipulated in the Order of the Commission under Regulation
21.6;
(b) The balance amount, which will amount to two-thirds of such gain, may be utilised
at the discretion of the Generating Company or Transmission Licensee or SLDC or
Distribution Licensee.
24.2 The approved aggregate loss to the Generating Company or Transmission
Licensee or SLDC or Distribution Licensee on account of controllable factors sohall be
dealt with in the following manner:
(a) One-third of the amount of such loss may be passed on as an additional charge in
tariffs over such period as may be stipulated in the Order of the Commission under
Regulation 21.6; and
(b) The balance amount of loss, which will amount to two-thirds of such loss, shall be
absorbed by the Generating Company or Transmission Licensee or SLDC or
Distribution Licensee.”

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

As shown in the Table below, UGVCL has claimed a revenue (Gap) of Rs. Crore in
the truing up considering the treatment of Gain/(Loss) due to controllable/
uncontrollable factors, after comparing the performance with the Tariff Order for FY
2017-18.

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Table 4-56: Revenue Surplus/ (Gap) for FY 2017-18

(Rs. Crore)
Sr. FY 2017-
Particulars
No. 18
1 Aggregate Revenue Requirement approved for 2017-18 in MYT Order 9830.54
Gain / (Loss) on account of Uncontrollable Factors to be passed on to
2 (314.79)
Consumers
Gain / (Loss) on account of Controllable Factors to be passed on to
3 24.03
Consumers (1/3rd of Total Gain /Loss)
4 Revenue (Gap)/Surplus from True-up of FY 2015-16 126.99
5 Revised ARR for FY 2017-18 (1-2-3-4) 9994.31
6 Revenue from Sale of Power 9129.81
7 Other Income (Consumer related) 256.74
8 Agriculture subsidy 542.26
9 GUVNL Profit / (Loss) allocation 30.98
10 Total Revenue including Subsidy (9+10+11) 9959.79
Revised Surplus/ (Gap) after treating Gain/(Loss)due to
11 (34.52)
Controllable/ Uncontrollable Factors (8-12)

Petitioner’s Submission
The Petitioner submitted that the Commission in the MYT Order dated 31st March,
2017 has approved Aggregate Revenue Requirement of Rs.9830.54 Crore for FY
2017-18.
As per the mechanism specified in the GERC (MYT) Regulation 2016, UGVCL propose
to pass on a sum of 1/3rd of total gain on account of controllable factors i.e. Rs. 24.03
Crore out of Rs. 72.08 Crore and total loss on account of uncontrollable factors i.e. Rs.
(314.79) Crore to the consumers.
The past revenue (Gap) / Surplus of Rs. 126.99 Crore, for FY 2015-16 is also adjusted
in the approved Aggregate Revenue Requirement. Accordingly, UGVCL has arrived at
the revised Aggregate Revenue Requirement for FY 2017-18 at Rs. 9994.31 Crore as
shown in above Table.
This revised Aggregate Revenue Requirement is compared against the revised income
under various heads including Revenue with Existing Tariff of Rs. 9129.81 Crore, Other
Consumer related Income of Rs. 256.74 Crore and Agriculture Subsidy of Rs. 542.26
Crore. GUVNL profit of Rs. 126.05 Crore for FY 2017-18 is allocated amongst four
DISCOMs with UGVCL’s share being Rs. 30.98 Crore. Accordingly, the Total Revenue
considering all these elements works out to Rs. 9959.79 Crore. Revenue Gap of
UGVCL for FY 2017-18 after considering all the above adjustments is computed at Rs.
34.52 Crore.

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Commission’s Analysis

The Commission compared the actual performance of UGVCL with the values
approved in the MYT Order dated 31st March 2017. The Commission also verified the
Tariff Order dated 31st March, 2017 in Petition No. 1622 of 2016 and observed that the
Petitioner has claimed the Surplus of Rs. 126.99 Crore of FY 2015-16 approved by the
Commission in the said Order while determining tariff for FY 2017-18.
The Commission has arrived at the revised ARR and revenue (Gap), based on the
expenses and the Gain / (Loss) approved in the truing up for FY 2017-18 and the
earlier year’s Surplus. The revenue Surplus/ (Gap) as approved by the Commission
for FY 2017-18 is summarised in the Table below:

Table 4-57: Revenue Surplus/(Gap) approved in the truing up for FY 2017-18

(Rs. Crore)
Sr.
Particulars 2017-18
No.
Aggregate Revenue Requirement approved for 2017-18 in MYT
1 9830.54
Order
Gain / (Loss) on account of Uncontrollable Factors to be passed on
2 (323.47)
to Consumers
Gain / (Loss) on account of Controllable Factors to be passed on to
3 24.03
Consumers (1/3rd of Total Gain /Loss)
4 Revenue (Gap)/Surplus from True-up of FY 2015-16 126.99
5 Revised ARR for FY 2017-18 (1-2-3-4) 10002.99
6 Revenue from Sale of Power 9129.81
7 Other Income (Consumer related) 256.74
8 Agriculture Subsidy 542.26
9 GUVNL Profit / (Loss) allocation 30.98
10 Total Revenue including Subsidy (6+7+8+9) 9959.79
Revised Surplus/ (Gap) after treating Gain/(Loss)due to
11 (43.20)
Controllable/ Uncontrollable factors (10-5)

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5 Mid-Term Review of ARR for FY 2019-20 and FY

2020-21

5.1 Introduction
In terms of Regulation 16.2 (i) of the GERC (MYT) Regulations, 2016, a Mid-Term
Review of the Annual Revenue Requirement shall be undertaken for the Generating
Company, Transmission Licensee, SLDC and Distribution Licensee on an application
that shall be filed by utilities along with the petition for truing up for the second year of
the control period and tariff determination for the fourth year of the control period.

5.2 Submission of UGVCL

In accordance with the above provisions Uttar Gujarat Vij Company (UGVCL) has filed
the petition for Mid-Term review of ARR for the remaining control period i.e., FY 2019-
20 and FY 2020-21.

5.2.1 Summary of the petition for Mid-Term review for the remaining
control period, FY 2019-20 and FY 2020-21

UGVCL has projected its Revised Aggregate Revenue Requirement for FY 2019-20
and FY 2020-21 as part of Mid-Term Review process for the remaining years of the
control period of the GERC (MYT) Regulations, 2016.

The comparison of revised projections for FY 2019-20 and FY 2020-21 vis-a-vis the
figures approved by the Commission in the MYT order dated 31st March, 2017 is given
in the Table below:

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Table 5-1: Mid-Term Review for FY 2019-20 and FY 2020-21

(Rs. Crore)
2019-20 2020-21
Sr. Approved Approved
Particulars Projected Projected
No. in the MYT in the MYT
in MTR in MTR
Order Order
1 Power Purchase 9760.79 11156.97 10499.76 11835.84
Operations & Maintenance
2 495.19 840.71 523.51 942.07
Expenses
2.1 Employee Cost 473.43 734.53 500.51 829.82
Repairs & Maintenance
2.2 98.91 98.91 104.57 104.57
Expenses
Administration & General
2.3 84.60 84.60 89.44 89.44
Expenses
2.4 Other Debits - - - -
2.5 Extraordinary Items - - - -
Net Prior Period Expenses
2.6 - - - -
/ (Income)
Other Expenses
2.7 (161.75) (77.33) (171.00) (81.76)
Capitalised
3 Depreciation 399.19 248.47 427.81 273.65
Interest & Finance
4 140.89 189.21 139.64 201.94
Charges
Interest on Working
5 0.00 0.00 0.00 0.00
Capital
6 Bad Debts Written off 0.70 0.31 0.70 0.31
7 Sub-Total [1 to 6] 10796.76 12435.67 11591.42 13253.82
8 Return on Equity 212.51 215.36 226.97 231.86
Provision for Tax / Tax
9 17.14 14.38 17.14 14.38
Paid
Total Expenditure (7 to
10 11026.41 12665.41 11835.53 13500.06
9)
11 Less: Non-Tariff Income 146.76 138.68 146.76 138.68
Aggregate Revenue
12 10879.65 12526.72 11688.77 13361.38
Requirement (10 - 11)

5.3 Estimation of ARR for the remaining years of control

period, FY 2019-20 and FY 2020-21

The Mid-Term Review covers the following items of ARR for the remaining years of
control period i.e., FY 2019-20 and FY 2020-21.
 Energy projection
 Consumer profile
 Distribution loss
 Energy Requirement and energy balance
 Power purchase – Bulk supply tariff
 Transmission charges
 Capital expenditure and Funding of CAPEX.
 Operations and Maintenance Expenses
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 Depreciation
 Interest on loan and Finance Expenses
 Interest on Working Capital
 Return on Equity
 Provision for Tax

The Commission has analysed the energy sales and components of expenditure and
discussed the same hereunder.

5.4 Energy Sales

5.4.1 Projection of Energy sales for FY 2019-20 and FY 2020-21

UGVCL has projected the energy sales for FY 2019-20 and FY 2020-21 based on the
trends during the past years. Wherever the trend has seemed unreasonable or
unsustainable, the growth factors have been corrected to arrive at more realistic
projections.
The Petitioner has furnished actual category-wise energy sales for the last 5 years (FY
2012-13 to FY 2017-18) and projected the sales for FY 2019-20 and FY 2020-21 and
also underlying CAGR for (5 year, 3 year and YoY).
Category-wise sales over the last 5 years are shown in Table below:

Table 5-2: Historical Trend in Category-wise Units sold

(MUs)
Sr.
Category 12-13 13-14 14-15 15-16 16-17 17-18
No.
LOW TENSION
1 RGP 1480 1573 1764 1881 1971 2102
2 GLP 32 34 37 41 43 45
3 Non-RGP & LTMD 1326 1337 1432 1557 1643 1763
4 Public Water Works 515 518 572 610 645 708
5 Agriculture-Unmetered 6094 6164 6177 6219 6284 6313
6 Agriculture-Metered 1536 1332 1893 2330 2407 2736
7 Street Light 43 46 48 52 54 52
Sub-Total 11027 11005 11923 12690 13046 13718
HIGH TENSION
1 Industrial HT 3771 3465 4469 4550 5307 6418
2 Railway Traction 17 15 16 14 0 0
Sub Total 3788 3481 4485 4564 5307 6418
Total 14816 14486 16408 17254 18352 20137

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Table 5-3: Category-wise Growth rate of Units Sold

Sr. No. Category 5 year 4 year 3 year 2 year 1 year
LOW TENSION
1 RGP 7.26% 7.51% 6.02% 5.70% 6.65%
2 GLP 6.80% 7.48% 6.44% 4.52% 5.46%
3 Non-RGP & LTMD - - 7.17% 6.39% 7.30%
4 Public Water Works 6.57% 8.12% 7.39% 7.73% 9.82%
5 Agriculture-Unmetered 0.71% 0.60% 0.72% 0.75% 0.46%
6 Agriculture-Metered 12.24% 19.71% 13.08% 8.37% 13.67%
7 Street Light 3.81% 3.05% 2.58% 0.03% -3.34%
Sub-Total 4.46% 5.67% 4.79% 3.97% 5.16%
HIGH TENSION
1 Industrial HT 11.22% 16.66% 12.82% 18.77% 20.95%
2 Railway Traction - - - - -
Sub Total 11.12% 16.53% 12.69% 18.59% 20.95%
TOTAL 6.33% 8.58% 7.06% 8.03% 9.72%
*Railway is no more a discom consumer, therefore CAGR is not Computed.

5.4.2 Consumer Profile

UGVCL has furnished the category-wise number of consumers for the past period and
the CAGR for different periods (5 year, 3year and year on year) as given below:

Table 5-4: Category-wise number of Consumers

(Nos.)
Sr.
Category 12-13 13-14 14-15 15-16 16-17 17-18
No.
LOW TENSION
1 RGP 2298488 2368434 2432,337 2520821 2612174 2672013
2 GLP 19209 19410 20483 21932 23334 23538
3 Non-RGP & LTMD 267930 281035 295632 315654 335774 346316
4 Public Water Works 14511 15412 16540 18158 19642 20393
5 Agriculture-Unmetered 155009 154695 154384 154182 154041 152760
6 Agriculture-Metered 90070 106859 129011 154386 171337 195034
7 Street Light 9693 10274 10923 11788 12778 14007
Sub-Total 2854910 2956119 3059310 3196921 3329080 3424061
HIGH TENSION
1 Industrial HT 2551 2743 3001 3284 3511 3755
2 Railway Traction 1 1 1 1 0 0
Sub Total 2552 2744 3002 3285 3511 3755
TOTAL 2857462 2958863 3062312 3200206 3332591 3427816

Table 5-5: Growth rate of Number of Consumers

Sr. No. Category 5 year 4 year 3 year 2 year 1 year
LOW TENSION
1 RGP 3.06% 3.06% 3.18% 2.96% 2.29%
2 GLP 4.15% 4.94% 4.74% 3.60% 0.87%
3 Non-RGP & LTMD 0.00% 0.00% 5.42% 4.74% 3.14%
4 Public Water Works 7.04% 7.25% 7.23% 5.98% 3.82%
5 Agriculture-Unmetered -0.29% -0.31% -0.35% -0.46% -0.83%
6 Agriculture-Metered 16.71% 16.23% 14.77% 12.40% 13.83%

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Sr. No. Category 5 year 4 year 3 year 2 year 1 year

7 Street Light 7.64% 8.06% 8.64% 9.01% 9.62%
Sub-Total 3.70% 3.74% 3.83% 3.49% 2.85%
HIGH TENSION
1 Industrial HT 8.04% 8.17% 7.76% 6.93% 6.95%
2 Railway Traction - - - - -
Sub Total 8.03% 8.16% 7.75% 6.91% 6.95%
TOTAL 3.71% 3.75% 3.83% 3.50% 2.86%
*Railway is no more a discom consumer, therefore CAGR is not Computed.

5.4.3 Category-wise Connected Load

The Petitioner has also submitted category-wise connected load for the past period
and CAGR for different periods (5 year, 3 year and year on year) as given below:

Table 5-6: Category-wise of Connected Load

(MW / MVA)
Sr. No. Category 12-13 13-14 14-15 15-16 16-17 17-18
LOW
TENSION
1 RGP 1756 1911 2066 2286 2491 2l691
2 GLP 36 40 43 47 51 55
Non-RGP
3 1226 1278 1384 1516 1657 1792
& LTMD
Public
4 Water 243 292 310 334 354 371
Works
Agriculture-
5 2691 2710 2718 2736 2750 2763
Unmetered
Agriculture-
6 1083 1284 1546 1838 2130 2346
Metered
7 Street Light 28 21 22 25 27 30
Sub-Total 7063 7535 8088 8781 9459 10047
HIGH
TENSION
Industrial
1 1473 1657 1725 1877 2130 2287
HT
Railway
2 5 5 5 5 0 0
Traction
Sub Total 1478 1662 1730 1882 2130 2287
TOTAL 8541 9197 9818 10662 11589 12334

Table 5-7: Growth Rate of Connected Load

Sr. No. Category 5 year 4 year 3 year 2 year 1 year
LOW TENSION
1 RGP 8.91% 8.93% 9.21% 8.49% 8.04%
2 GLP 8.89% 8.40% 8.73% 8.21% 9.09%
3 Non-RGP & LTMD 0.00% 0.00% 9.00% 8.73% 8.12%
4 Public Water Works 8.85% 6.22% 6.22% 5.45% 4.76%
5 Agriculture-Unmetered 0.53% 0.49% 0.55% 0.49% 0.48%
6 Agriculture-Metered 16.71% 16.26% 14.91% 12.97% 10.13%
7 Street Light 1.19% 9.45% 9.89% 10.05% 9.96%

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Sr. No. Category 5 year 4 year 3 year 2 year 1 year

Sub-Total 7.30% 7.46% 7.50% 6.97% 6.22%
HIGH TENSION
1 Industrial HT 9.19% 8.38% 9.85% 10.37% 7.34%
2 Railway Traction - - - - -
Sub Total 9.12% 8.31% 9.75% 10.24% 7.34%
TOTAL 7.63% 7.61% 7.90% 7.55% 6.42%

5.4.4 Category-wise Projected Growth rates of energy sales

The Petitioner has considered following growth rates for projection of energy sales for
FY 2019-20 and FY 2020-21:

Table 5-8: Projected Growth Rates

Connected
Sr. No. Particulars Sales Consumers
Load
LOW TENSION
1 RGP 8.91% 7.26% 3.06%
2 GLP 8.73% 6.44% 4.74%
3 Non-RGP & LTMD 9.00% 7.17% 5.42%
4 Public Water Works 6.22% 7.39% 7.23%
5 Agriculture-Unmetered - - -
6 Agriculture-Metered - - -
7 Street Light 1.19% 3.81% 7.64%
HIGH TENSION
1 Industrial HT 9.85% 12.82% 7.64%
2 Railway Traction - - -

Category-wise projected energy sales for the FY 2019-20 and FY 2020-21

The Petitioner has projected the energy sales for FY 2019-20 and FY 2020-21, the
balance period of the control period, by applying the growth rates shown in the Table
above on the energy sales of FY 2017-18.

Table 5-9: Projected Energy sales for FY 2018-19, 2019-20 and 2020-21
(MUs)
Sr. Projection
Sales
No FY 2018-19 FY 2019-20 FY 2020-21
LOW TENSION
1 RGP 2254 2418 2594
2 GLP 48 51 54
3 Non-RGP & LTMD 1889 2025 2170
4 Public Water Works 760 816 877
5 Agriculture-Unmetered 6313 6313 6313
6 Agriculture-Metered 2927 3119 3301
7 Street Light 54 56 58
Sub-Total 14245 14798 15366
HIGH TENSION
1 Industrial HT 7241 8170 9218
2 Railway Traction 0 0 0
Sub Total 7241 8170 9218
TOTAL 21487 22968 24584

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5.4.5 Detailed Analysis of Energy Sales projected

UGVCL has, in the Tables 5.3, 5.5 & 5.7 mentioned the growth rates as 5 year CAGR
for the period from FY 2012-13 to FY 2017-18 and 3 year CAGR for the period from
FY 2014-15 to FY 2017-18.
The category-wise sales given in Table 5.2 for the period from FY 2012-13 to FY 2017-
18 are the actual. The energy sales for FY 2019-20 and FY 2020-21 are projected
based on 5 year and 3 year CAGR between FY 2012-13 and FY 2017-18 and year on
year between the FY 2017-18 over FY 2016-17. The projected sales for FY 2019-20
and FY 2020-21 are considered based on actuals for FY 2017-18.

Residential (RGP)

UGVCL has projected the energy sales to Residential category for FY 2019-20 and FY
2020-21 as given below:
(MUs)
Category 2018-19 2019-20 2020-21
Residential (RGP) 2254 2418 2594

Petitioner’s submission:

UGVCL has submitted that the company has witnessed a remarkable growth in the
units sold in the last five years in this category. The CAGR between FY 2012-13 and
FY 2017-18 was 7.26%. The company expects this trend to continue in FY 2019-20
and FY 2020-21.

Commission’s Analysis:

The Commission considered the growth rate of 8.14% which was the historical growth
rate for 5 years (FY 2010-11 to FY 2015-16) in the MYT Order dated 31 Match, 2017.
The Petitioner expects the 5 year growth of 7.26% to continue during the rest of the
control period, FY 2019-20 and FY 2020-21 which is considered reasonable and the
Commission, therefore, approves the energy sales at 2418 MUs for FY 2019-20 and
2594 MUs for FY 2020-21 in the Mid-Term Review.
The Commission approves the energy sales to Residential category at 2418 MUs
and 2594 MUs for FY 2019-20 and FY 2020-21 respectively at a growth rate of
7.26% against 2573 MUs and 2783 MUs approved in the MYT order for respective
years .
Table 5-10: Sales approved for Residential category in the Mid-Term Review
(MUs)
Category 2019-20 2020-21
Residential (RGP) 2418 2594

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GLP – General Lighting Purpose

Petitioner’s submission:
UGVCL has submitted that the 3 year CAGR between FY 2014-15 and FY 2017-18
was 6.44% and the company expects this trend to continue in FY 2019-20 and FY
2020-21.

Commission’s Analysis:
The Petitioner has worked out actual 3 Year CAGR of 6.44% and expects this trend to
continue.
The rate 6.44% adopted by the Petitioner is considered reasonable by the
Commission, and accordingly, the Commission approves the energy sales at 51 MUs
for FY 2019-20 and 54 MUs for FY 2020-21 in the Mid-Term Review.

The Commission approves the energy sales to GLP category at 51 MUs and 54
MUs for FY 2019-20 and FY 2020-21 respectively at a growth rate of 6.44% against
57 MUs and 61 MUs approved in the MYT order for respective years.

Table 5-11: Sales approved for GLP category in the Mid-Term Review
(MUs)
Category 2019-20 2020-21
GLP 51 54

Non-RGP and LTMD

Petitioner’s submission:
For the purpose of projection of units sold 3 year CAGR of 7.17% between FY 2014-
15 and FY 2017-18 has been considered by the Petitioner. The company expects this
trend to continue in FY 2019-20 and FY 2020-21.

Commission’s Analysis:
The Commission had considered the 3 year growth rate of 5.50% (3 Years CAGR
between FY 2012-13 to FY 2015-16) for Non-RGP and LTMD category for FY 2019-
20 and FY 2020-21 in MYT Order dated 31st March 2017. In the Mid-Term Review,
UGVCL has adopted 7.17% growth rate(3 Years CAGR).
The Commission considers it reasonable to adopt the 3 year CAGR of 7.17% over the
sales of FY 2017-18 and has worked out the projected sales of these categories (Non-
RGP & LTMD).

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Table 5-12: Approved Sales for Non-RGP & LTMD Category together in the Mid-Term
Review
(MUs)
Category 2019-20 2020-21
Non-RGP & LTMD 2025 2170

The Commission approves the energy sales to Non-RGP & LTMD category at
2025 MUs and 2170 MUs for FY 2019-20 and FY 2020-21 respectively against 1929
MUs and 2035 MUs approved in the MYT order for respective years at a growth
rate of 7.17%.

Public Water Works

Petitioner’s Submission:

UGVCL has submitted that the 2 year CAGR for this category was coming out to be
7.73% and y-o-y at 9.82% which is on a higher side when compared to the 3 year
CAGR of 7.39%. Therefore, a more realistic growth rate at 3 year CAGR has been
considered. The company expects this trend to continue in FY 2019-20 and FY 2020-
21.

Commission’s Analysis:

The Commission had approved the sales of 846 MUs & 918 MUs for FY 2019-20 and
FY 2020-21 respectively considering the growth rate of 8.52% (2 Years CAGR) in the
MYT Order dated 31st March, 2017. However considering the actual growth during the
3 years period, the Petitioner has projected lower sales. The growth rate of 7.39%
adopted by UGVCL is therefore, considered reasonable for FY 2019-20 and FY 2020-
21 and accordingly, the Commission accepts the sales projection as given in the Table
below:

Table 5-13: Sales approved for Public Water Works in the Mid-Term Review
(MUs)

Category 2019-20 2020-21

Public Water Works 816 877

The Commission approves the energy sales to Public Water Works category at
816 MUs and 877 MUs for FY 2019-20 and FY 2020-21 respectively against 846
MUs and 918 MUs approved in the MYT order for respective years at a growth
rate of 8.52%.

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Agriculture
Petitioner’s Submission:
UGVCL has submitted that based on Government & internal targets the Company is
planning to release new connections under this category but only under the metered
category. For the unmetered category the company has decided not to release any
new connections and has accordingly assumed a growth rate of 0% to project the
sales, no. of consumers and connected load during the control period.

The Company has planned new connections under metered category during the
balance control period as under:

Sl. No. Year No. of new Connections

1 2018-19 11100
2 2019-20 11150
3 2020-21 10600

In order to estimate the consumption, UGVCL has gone with the same methodology
as was followed by the Commission in its previous tariff orders i.e. estimating the
overall consumption assuming an average consumption, calculated based on the
weighted average consumption of the metered category during the past years. UGVCL
has calculated the weighted average consumption based on the data available for the
last five years in order to achieve a more reasonable consumption estimate. This
approach is same as adopted and approved by the Commission in the MYT Order.
Thus, based on the figures arrived at as above, the total sales for each year has been
calculated based on the average connected load per consumer for metered and
unmetered categories combined in FY 2017-18 and the number of new connections to
be added during each year. The year wise addition of new metered connections during
the control period in the service area of the company has been presented in the Table
below:

Table 5-14: New Metered connections to Agricultural Consumer

No. of Averag
Agriculture HP MW Per HP Additional
Connecti e HP of
Metered Increase Increase Consumption Sale (MUs)
ons Discom
2018-19 11100 20 218643 163 873 191
2019-20 11150 20 219628 164 873 192
2020-21 10600 20 208795 156 873 182

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Commission’s Analysis:
The Commission had approved the energy consumption of 6219 MUs for Unmetered
Consumers for FY 2019-20 and FY 2020-21 in the MYT Order dated 31st March, 2017.
UGVCL has now projected 6313 MUs for FY 2019-20 and FY 2020-21. The
Commission approves the sales for Unmetered Consumers at 6313 MUs for the FY
2019-20 and FY 2020-21 at the same level of FY 2017-18.
As regards the Metered Consumers, UGVCL has projected the sales of 3119 MUs and
3301 MUs for FY 2019-20 and FY 2020-21 respectively at a consumption of 873
kWh/HP/Annum as against 928 kWh/HP/Annum considered in MYT Order dated 31st
March, 2017 which is the weighted average consumption of Metered Consumers
during FY 2010-11 and FY 2015-16. After detailed examination of the average
consumption of Metered Consumers submitted by UGVCL, the Commission
considered the average consumption for Metered Consumers at 873 kWh/HP/Annum,
being the average consumption as given in Table below:

2013-14 Details
Number of Consumers (Nos.) 106859
Connected Load (HP) 1721872
Consumption (MUs) 1332
2014-15
Number of Consumers (Nos.) 129011
Connected Load (HP) 2073220
Consumption (MUs) 1893
2015-16
Number of Consumers (Nos.) 154386
Connected Load (HP) 2464610
Consumption (MUs) 2330
2016-17
Number of Consumers (Nos.) 171337
Connected Load (HP) 2856094
Consumption (MUs) 2407
2017-18
Number of Consumers (Nos.) 195034
Connected Load (HP) 3145500
Consumption (MUs) 2736

From the above, the total avg. connected load for 5 years works out to 2452259.26 HP
[(1721872+2073220+2464610+285094+3145500)/5] and the total average
consumption works out to 2140 MUs [(1332+1893+2330+2407+2736)/5]. Based on
this, the weighted average consumption of Metered Consumers in UGVCL area for the
FY2013-14 to 2017-18 works out to 873 kWh/HP/Annum.
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The Commission, therefore, considers the consumption at 873 kWh/HP/annum for

Metered Consumers for FY 2019-20 and FY 2020-21. Based on the above , the sales
to Metered category is under :-

Table 5-15: Consumption of metered Consumers approved in the Mid-Term Review

(MUs)
Year Consumption
2019-20 3119
2020-21 3301

The consumption (sales) to Agricultural category both for un-metered and metered
category would be as below:)

Table 5-16: Approved Sales for Agriculture Consumers in the Mid-Term Review
(MUs)
Category 2019-20 2020-21
Un-metered 6313 6313
Metered 3119 3301
Total 9432 9614

The Commission approves the sales to Agriculture Category at 9432 MUs and
9614 MUs for FY 2019-20 and FY 2020-21 respectively.

Public Lighting

Petitioner’s Submission:

UGVCL has submitted that the 5 year CAGR observed between FY 2012-13 and FY
2017-18 was 3.81% and it is expected that this trend will continue in FY 2019-20 and
FY 2020-21 also.

Commission Analysis:

UGVCL has projected the sales at a growth rate (5 Years CAGR) of 3.81%. The
Commission had approve the sales for this category at 66 MUs and 58 MUs for FY
2019-20 and FY 2020-21 respectively in the MYT Order dated 31st March 2017
considering 5 Years CAGR 5.97%. UGVCL has projected the sales for FY 2019-20
and FY 2020-21 at 56 MUs and 58 MUs respectively at a 5 Year CAGR of 3.81%. The
Commission considers the projected sales as reasonable and approves the sales for
FY 2019-20 and FY 2020-21 as below:

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Table 5-17: Energy Sales approved for FY 2019-20 and FY 2020-21

(MUs)
Sl. No. Category 2019-20 2020-21
1 Public Lighting 56 58

The Commission approves the sales to Public Lighting Category at 56 MUs and
58 MUs for FY 2019-20 and FY 2020-21 respectively.

Industrial HT

Petitioner’s Submission:
UGVCL has submitted that this category has observed a constant variation in sales in
the last five years due to presence of open access, slowdown in the economy, etc. The
5-year and 4-year CAGR are higher at 11.22% and 16.66% respectively whereas the
y-o-y growth is also higher at 20.95%. Therefore, a more realistic 3-year CAGR of
12.82% is considered as reasonable. The company expects this trend to continue in
FY 2019-20 and FY 2020-21 also.

Commission’s Analysis:

It is observed that the growth in sales of this category was 11.22% during the 5 year
period (FY 2012-13 to FY 2017-18), 12.82% during 3 year period ( FY 2015-16 to FY
2017-18) and 20.95% during the FY 2017-18 over FY 2016-17. It is also observed that
there is an increasing trend in this category. The growth rate of number of consumers
has been consistently decreasing. (5 year CAGR at 8.04%, 3 year CAGR at 7.76%
and FY 17 over FY 16 at 6.95%).

The actual sales for this category during FY 2017-18 was 6418 MUs. Sales projected
by the Petitioner for the FY 2019-20 and FY 2020-21 is 8170 MUs and 9218 MUs by
taking the growth rate of 12.82% against the sales actually approved by the
Commission for FY 2019-20 and 2020-21, 4889 MUs and 4977 MUs in the MYT Order
dated 31st March, 2017 considering Y-o-Y Growth Rate of 1.81%. The Commission
considered rate of 12.82% (3 Year CAGR) as reasonable and approves the sales for
the purpose of Mid-Term Review.

Accordingly, the energy sales approved for Industrial HT category for FY 2019-20 and
FY 2020-21 applying the growth rate of 12.82% over the sales of FY 2017-18 is given
in the Table below:

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Table 5-18: Approved Sales for Industrial HT category in the Mid-Term Review
(MUs)
SI. No. Category 2019-20 2020-21
1 Industrial HT 8170 9218

Railway Traction

UGVCL has submitted that no projection has been made for sales, consumers and
connected load for the control period as the consumer has moved out of the company’s
consumer base.

Commission’s Analysis:

The Commission approved the energy sales of “0” MUs for FY 2019-20 and FY 2020-
21 respectively in the MYT Order. Against this, UGVCL has not projected sales,
consumers and connected load for FY 2019-20 and FY 2020-21. As the consumer has
moved out of the company’s consumer base, the Commission approves the Nil sales
for Railway Traction as below:

5.4.6 Total Energy Sales

Total Energy sales for FY 2019-20 and FY 2020-21 approved by the Commission
based on the above analysis is summarised in the Table below:

Table 5-19: Energy Sales approved in the Mid-Term Review

(MUs)
Sr. No Category 2019-20 2020-21
LOW TENSION
1 Residential (RGP) 2418 2594
2 GLP 51 54
3 Non-RGP & LTMD 2025 2170
4 Public Water Works 816 877
5 Agriculture Unmetered 6313 6313
6 Agriculture Metered 3119 3301
7 Public Lighting 56 58
8 Total LT 14798 15366
HIGH TENSION
9 Industrial HT 8170 9218
10 Railway Traction 0 0
11 Total HT 8170 9218
TOTAL (LT + HT) (8+11) 22968 24584

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5.5 Distribution Losses

UGVCL has projected distribution losses for FY 2019-20 and FY 2020-21 in the Mid-
Term Review as given in the Table below:

Table 5-20: Projected Distribution Losses for FY 2019-20 and FY 2020-21

Sl. No. Particulars FY 2019-20 FY 2020-21
1 Distribution Losses 9.70% 9.60%

Petitioner’s Submission:

UGVCL has submitted that the company has, through its constant endeavours, tried
to reduce its losses in the past. These efforts shall continue and will be enhanced.
However, loss reduction is a slow process and becomes increasingly difficult as the
loss levels come down.

Commission’s Analysis:

The Commission in the MYT Order dated 31st March 2017, considered distribution
losses at 9.70% during FY 2019-20 and 9.60% during FY 2020-21 and the distribution
losses projected by UGVCL is 9.70% for FY 2019-20 and 9.60% for FY 2020-21.Thus,
there is no change in the distribution losses approved by the Commission in the MYT
Order and the losses projected by UGVCL in the Mid-Term Review for FY 2019-20 and
FY 2020-21. Hence, the Commission approves the distribution losses of 9.70% for FY
2019-20 and 9.60% for FY 2020-21.

5.6 Energy Requirement and Energy Balance

The total energy requirement of the distribution company to meet the total demand of
its consumers is the sum of the estimated energy sales and the system losses
(distribution losses) approved by the Commission.

Petitioner’s Submission:

UGVCL has submitted that to arrive at the total energy requirement, the total sales in
MUs as projected have been grossed up by factoring in transmission and distribution
losses. Intra-state transmission losses are assumed as per the projection by GETCO
in its MTR Petition for FY 2019-20 and FY 2020-21. The inter-state transmission losses
viz. PGCIL pooled losses are assumed at same level as in FY 2017-18 for the entire
control period. Further, the distribution losses are taken as per the projections above.
Based on the information provided above, Energy Balance of the Company for FY
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2019-20 to 2020-21 is as shown below:

Table 5-21: Projected Energy Requirement and Energy Balance

Particulars Unit 2019-20 2020-21
Energy Sales MUs 22967.58 24583.98
MUs 2467.17 2610.69
Distribution Losses
% 9.70% 9.60%
Energy Requirement MUs 25434.75 27194.67
Transmission Losses MUs 1018.00 1089.00
Total Energy input to Transmission System % 3.85% 3.85%
Total Energy input to Transmission System MUs 26452.75 28283.67
Pooled Losses in PGCIL System MUs 396.26 396.26
Total Energy Requirement MUs 26849.02 28679.93

Commission’s Analysis:

Based on the energy sales and the distribution losses approved by the Commission in
Paragraphs 5.4 and 5.5 above, the energy requirement is arrived at as given in the
Table below:

Table 5-22: Total approved Energy Requirement in the Mid-Term Review

(MUs)
Sr. No. Particulars Unit 2019-20 2020-21
1 Estimated Energy Sales MUs 22967.58 24583.98
MUs 2467.17 2610.69
2 Distribution Losses
% 9.70% 9.60%
Energy requirement at the Distribution
3 MUs 25434.75 27194.67
periphery

5.7 Energy Balance

Commission’s Analysis:

Energy Balance projected by UGVCL is given in Table 5-22 above. UGVCL has
considered Transmission losses at 3.85% which is the same as approved by the
Commission in the MYT Order dated 31st March, 2017. The pooled losses in PGCIL
system are considered at 396.26 MUs for FY 2019-20 and FY 2020-21 same as the
actual for FY 2017-18 by UGVCL. The Commission considers the Transmission losses
at 3.85% and pooled losses in PGCIL system as projected by UGVCL to arrive at the
Energy Balance in the Table below:

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Table 5-23: Approved Energy Balance in the Mid-Term Review

Particulars Unit 2019-20 2020-21
Energy Sales MUs 22967.58 24583.98
MUs 2467.17 2610.69
Distribution Losses
% 9.70 9.60
Energy Requirement MUs 25434.75 27,194.67
Transmission Losses MUs 1018.00 1089.00
Total Energy input to Transmission System % 3.85 3.85
Total Energy input to Transmission System MUs 26452.75 28283.67
Pooled Losses in PGCIL System MUs 396.26 396.26
Total Energy Requirement MUs 26849.02 28679.93

5.8 Power Purchase Cost – Petitioner’s Submission

5.8.1 Power Purchase Sources

Petitioner’s submission

The various sources of power purchase by GUVNL on behalf of four Distribution

Companies consists of (i) Generating Plants of GSECL (ii) Central Sector Power
Plants- NTPC and NPC, (iii) Renewable sources of power - Hydro, Solar Wind, Other
RE Sources (iv) IPPs and (v) Power tied up through competitive bidding etc. The power
purchase sources have been differentiated into existing capacity and additional
capacity envisaged during the control period.

(i) Existing capacity with GUVNL

The existing contracted capacity tied up by GUVNL as on 31st March 2018 is 22616
MW. Given below are the names of the existing power plants, their operational
parameters, capacity allocated to GUVNL, their fixed cost along with the variable cost
of generation per unit as per actual of FY 2017-18:

Table 5-24: Existing Capacity contracted by GUVNL

Plant Fixed
Sr. Capacity Auxiliary Variable
Load Cost
No Name of the Station allocated to Consumpti Cost
Factor (Rs.
. GUVNL (MW) on (%) (Rs./kWh)
(%) Crore)
GSECL
1 GSECL Gandhinagar – 5 210 9.00% 78.49% 23 3.50
2 GSECL Wanakbori – 7 210 9.00% 80.11% 62 3.21
3 GSECL Utran Expan 375 3.00% 7.85% 250 5.35
4 GSECL Dhuvaran – 7 107 3.00% 21.08% 61 1.49
5 GSECL Dhuvaran – 8 112 3.00% 37.78% 86 1.28
6 GSECL Ukai 610 9.00% 85.00% 262 3.39
7 GSECL Ukai Expan 500 6.00% 85.00% 447 3.04
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Plant Fixed
Sr. Capacity Auxiliary Variable
Load Cost
No Name of the Station allocated to Consumpti Cost
Factor (Rs.
. GUVNL (MW) on (%) (Rs./kWh)
(%) Crore)
8 GSECL Gandhinagar 1-4 420 10.00% 61.97% 204 3.74
9 GSECL Wanakbori 1-6 1,260 9.00% 85.00% 448 3.29
10 GSECL Sikka Expansion 500 9.00% 70.00% 629 3.65
11 GSECL Kutch Lignite 1-3 215 12.00% 52.31% 207 2.16
12 GSECL Kutch Lignite 4 75 12.00% 42.72% 62 1.98
13 GSECL Ukai Hydro 305 0.60% 11.71% 42 -
14 GSECL Kadana Hydro 242 1.00% 13.72% 73 -
15 BECL 500 6.50% 85.00% 879 2.15
16 Dhuvaran CCPP III 376 3.00% 0.94% 159 5.77
Sub Total 6,017 3894
IPP's
Gujarat State Energy
1 156 3.00% 0.15% 49 6.11
Generation
Gujarat State Energy
2 351 0.00% 6.08% 180 5.19
Generation Expansion
Gujarat Industries Power
3 165 3.00% 0.00% - 4.5
Co Ltd (165 MW)
Gujarat Industries Power
4 250 10.00% 71.59% 129 1.71
Co Ltd (SLPP)
Gujarat Mineral
5 250 10.00% 57.38% 124 1.26
Development Corp.
Gujarat Industries Power
6 42 3.00% 29.42% 5 2.27
Co Ltd (145 MW)
Gujarat Industries Power
7 250 10.00% 75.29% 273 1.88
Co Ltd (SLPP - Exp)
8 GPPC Pipavav 702 3.00% 2.80% 325 4.37
Sub Total 2,166 1085
Central Sector
1 NPC-Tarapur (1 & 2) 160 10.00% 42.73% - 2.08
2 NPC-Tarapur (3 & 4) 274 10.00% 59.81% - 3.1
3 NPC-Kakrapar 125 12.50% 52.60% - 2.39
4 NTPC-Vindhyachal - I 230 9.00% 87.98% 23 1.62
5 NTPC-Vindhyachal - II 239 6.50% 91.75% 128 1.52
6 NTPC-Vindhyachal - III 266 6.50% 95.29% 212 1.52
7 NTPC-Korba 360 6.50% 89.91% 23 1.46
8 NTPC-Korba –II 96 6.50% 91.19% 98 1.43
9 NTPC-Kawas 187 3.00% 43.80% 113 2.56
10 NTPC-Jhanor 237 3.00% 55.42% 132 2.39
11 NTPC-Sipat-I 540 6.50% 89.04% 519 1.3
12 NTPC-Sipat – II 273 6.50% 90.03% 250 1.35
13 NTPC-Kahlagaon 141 6.50% 78.80% 106 2.31
14 NTPC-Vindhyachal – IV 240 6.50% 90.40% 280 1.51
15 NTPC-Mauda 240 6.50% 85.00% 320 2.79
16 NTPC-Vindhyachal – V 93 6.50% 100.00% 118 1.57
17 NTPC-Mauda II 294 5.75% 85.05% 380 2.5
18 SSNL 232 0.00% 7.18% - 2.03
19 Mundra UMPP CGPL 1,805 0.00% 73.93% 1,129 1.66
Sub Total 6,032 3831
Others
1 Captive Power 8 0.00% 2.85% - 2.13
- Renewable
1 Wind Farms 3,695 0.00% 20.61% - 3.78
2 Solar 1,116 0.00% 17.84% - 11.45
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Plant Fixed
Sr. Capacity Auxiliary Variable
Load Cost
No Name of the Station allocated to Consumpti Cost
Factor (Rs.
. GUVNL (MW) on (%) (Rs./kWh)
(%) Crore)
3 Small/Mini Hydal 10 0.00% 65.00% - 3.39
4 Biomass 30 0.00% 80.00% 40 4.17
Competitive Bidding
1 Adani Power Ltd 2,000 0.00% 45.79% 975 1.81
2 Essar Power Bid 2 1,000 0.00% 28.13% 354 1.92
3 ACB India Ltd 200 0.00% 80.48% 201 0.82
4 Power Exchange 342 0.00% 100.00% - 4.5
Short term power
5 342 0.00% 100.00% - 3.5
purchase
Sub Total 8,401 1570
Total 22,616 10380

(ii) Capacity additions during FY 2019-20 and FY 2020-21

The capacity addition plan which includes capacity additions of GSECL, Central
stations and IPPs is presented in the Table below with details of the capacity allocated
to GUVNL and their unit wise tentative commissioning schedule. It is submitted that
the PPA is already signed for the stations listed below and are expected to get
commissioned during the FY 2019-20 to FY 2020-21.
The capacity addition envisaged against these petitions during FY 2019-20 to FY 2020-
21 is around 1,995 MW. The operational parameters, annual fixed cost and variable
cost per unit for these plants is given below. The Annual fixed cost and the availability
from the envisaged capacity during FY 2019-20 to FY 2020-21 have been considered
on pro-rata basis depending upon the tentative date of commissioning:

Table 5-25: Capacity Addition during the remaining control Period

Capacity
Plant Fixed
allocated Auxillary Variable
Sr. Load Cost
Name of the Stations to consumpt Cost COD
No. Factor Rs.
GUVNL ion (%) Rs./kWh
(%) Crore
(MW)
1 Small/Mini Hydal (New) 12 - - - 3.29 Apr-19
2 NTPC- Lara U#1 79 5.75% 85% 110 1.50 Oct-18
3 NTPC-Gadarwara Stage-1 U#1 152 5.75% 85% 152 1.50 Dec-18
4 NTPC-Gadarwara Stage-1 U#2 152 5.75% 85% 152 1.50 Sep-19
5 NTPC- Lara U#2 79 5.75% 85% 110 1.50 Sep-19
6 NPC Kakrapar Ext U#1 238 5.75% 85% 120 2.38 Mar-21
7 NPC Kakrapar Ext U#2 238 5.75% 85% 120 2.38 Mar-21
8 GSECL Wanakbori Ext U#8 800 5.75% 85% 905 2.94 Dec-18
9 NTPC- Khargone U#1 123 5.75% 85% 172 1.50 Jul-19
10 NTPC- Khargone U#2 123 5.75% 85% 172 1.50 Nov-19
11 Total Capcity Addition 1995

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(iii) Renewable Purchase Obligation

In accordance with the GERC (Procurement of Energy from Renewable Sources)

Regulations, 2010 and its First and Second Amendments in 2014 and 2018
respectively, the DISCOMS are obligated to procure electricity (in kWh) from
renewable energy sources, at a defined minimum percentage of the total consumption
of its consumers including T&D losses during a year. The percentage of procurement
is defined from FY 2017-18 to FY 2021-22. The minimum Renewable Energy purchase
in FY 2017-18 is 1.75% from Solar, 7.75% from Wind and 0.5% from others sources
like Biomass, Bagasse, MSW, etc.
As per Clause 6.4 of the National Tariff Policy 2016 dated 28th January, 2016 the
States have to achieve 8% Solar RPO targets by FY 2021-22. The relevant extract
from the Tariff Policy is given below:

“6.4 Renewable sources of energy generation including Co-generation from renewable

energy sources:
(i) Within the percentage so made applicable, to start with, the SERCs shall also
reserve a minimum percentage for purchase of solar energy from the date of
notification of this policy which shall be such that it reaches 8% of total consumption of
energy, excluding Hydro Power, by March 2022 or as notified by the Central
Government from time to time.

While the Commission has defined the RPO targets for FY 2017-18 to FY 2021-22
through the Second Amendment to the RPO Regulations, GUVNL/DISCOMS
proposes to purchase renewable power up to tied up RE capacity only for each of the
respective years as per the PPA price. The Petitioner has submitted that it is very
difficult to meet such high level of RPO targets and it will not be appropriate to show
RE purchase in the absence of any firm PPA. Hence, GUVNL/ DISCOM has only
considered RE purchase based on actual tied up capacity.

The year wise purchase from RE sources based on actual tied up capacity has been
detailed below:
Table 5-26: Procurement from RE for Meeting Projected RPO
Particulars FY 2019-20 FY 2020-21
Solar Wind Others Total Solar Wind Others Total

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Particulars FY 2019-20 FY 2020-21

Available Capacity upto FY
1744 6671 309 8724 1744 6671 309 8724
2017-18 (MUs)
10565 10565 10565
Total Requirement (MUs) 99680 99680 99680 99680 105652
2 2 2
RPO Obligation fulfilled 1.75% 6.69% 0.31% 8.75% 1.65% 6.31% 0.29% 8.25%
14.30 15.65
RPO Target 5.50% 8.05% 0.75% 6.75% 8.15% 0.75%
% %
RPO Target (MUs) 5482 8024 748 14254 7132 8611 792 16535
Unmet Target (MUs) 3738 1353 439 5530 5388 1940 483 7810
Additional Capacity based on PPAs executed
Additional Power
950 589 14 1554 2161 1058 177 3397
Purchase (MUs)
Power Purchase Cost
2.66 2.44 6.66 2.62 2.54 2.44 6.90 2.73
(Rs./kwh)
Power Purchase Cost
253 144 10 407 549 258 122 929
(Rs. Crore)
Unmet Capacity (MUs) 2788 764 424 3976 3226 881 306 4414

5.8.2 Power Purchase Cost

Petitioner’s submission:

UGVCL has submitted that in order to optimise the power purchase cost, GUVNL has
worked out a comprehensive Merit Order Dispatch (MOD) available from tied up
generating capacities. The dispatch from individual generating stations is worked out
based on the merit order of the variable cost of each generating unit as shown below:

 The NPC power plants, renewable and hydro plants have been considered as must
run power plants.
 During merit order despatch, at least 5% availability of each plant has been
considered to take care of the peak loads and peak season requirements.
 Availability of Thermal Stations has been considered at 85% / 80% as defined in
Regulations (CERC/GERC) and performance in previous years.
 The Fixed & Variable Cost for existing GSECL, IPP, Renewables and Central
Sector plants is taken as per actuals of FY 2017-18 as base power purchase cost

Based on the above factors, the plant-wise dispatchable energy and cost of
purchase by GUVNL from various plants of GSECL, Central generating stations, IPPs
and other sources, the generation fixed cost due to the capacity contracted,
and variable cost of generation per unit are given in the Table below. The dispatchable
energy (MUs) based on the allocated capacity and merit order stacking consists both
for supplying power to DISCOMs as well as for trading purpose.

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Table 5-27: Projected Power Purchase cost for FY 2019-20

Fixed Variable Variable Total
Available Dispatch
Sr. Cost Cost Cost Cost
Name of the Station
No. (Rs. (Rs. (Rs.
(MUs) (MUs) (Rs. Cr.)
Cr.) /kWh) Cr.)
GSECL
1 GSECL Gandhinagar – 5 1,314 1,314 23 3.50 460 483
2 GSECL Wanakbori – 7 1,341 1,341 62 3.21 430 492
3 GSECL Utran Expan 250 159 250 5.35 85 335
4 GSECL Dhuvaran – 7 191 191 61 1.49 28 89
5 GSECL Dhuvaran – 8 361 361 86 1.28 46 132
6 GSECL Ukai 4,133 4,133 262 3.39 1401 1663
7 GSECL Ukai Expan 3,500 3,500 447 3.04 1064 1511
8 GSECL Gandhinagar 3-4 2,052 166 204 3.74 62 266
9 GSECL Wanakbori 1-6 8,538 8,538 448 3.29 2809 3257
10 GSECL Sikka Expansion 2,790 199 629 3.65 73 702
11 GSECL Kutch Lignite 1-3 867 867 207 2.16 187 394
12 GSECL Kutch Lignite 4 247 247 62 1.98 49 111
13 GSECL Ukai Hydro 311 311 42 - - 42
14 GSECL Kadana Hydro 288 288 73 - - 73
15 BECL 3,481 3,481 879 2.15 748 1627
16 Dhuvaran CCPP III 30 30 159 5.77 17 176
GSECL Wanakbori Ext
17 5,614 5,614 905 2.94 1651 2556
U#8
Sub Total 35308 30740 4798 9113 13910
.
IPP's
Gujarat State Energy
1 2 2 49 6.11 1 50
Generation
Gujarat State Energy
2 187 154 180 5.19 80 260
Generation Expansion
Gujarat Industries Power
3 - - - 4.50 - -
Co Ltd (165 MW)
Gujarat Industries Power
4 1,411 1,411 129 1.71 241 370
Co Ltd (SLPP)
Gujarat Mineral
5 1,131 1,131 124 1.26 143 267
Development Corp.
Gujarat Industries Power
6 105 105 5 2.27 24 29
Co Ltd (145 MW)
Gujarat Industries Power
7 1,484 1,484 273 1.88 279 552
Co Ltd (SLPP - Exp)
8 GPPC Pipavav 167 167 325 4.37 73 398
9 Mundra UMPP CGPL 11,689 11,689 1,129 1.66 1940 3069
10 Adani Power Ltd 8,023 8,023 975 1.81 1452 2427
11 Essar Power Bid 2 2,464 2,464 354 1.92 473 827
12 ACB India Ltd 1,410 1,410 201 0.82 116 317
13 Power Exchange 3,000 150 - 4.5 68 68
Short Term Power
14 3,000 1,187 - 3.5 415 415
Purchase
Sub Total 34073 29377 3744 5304 9048

Central Sector
1 NPC-Tarapur (1 & 2) 539 539 - 2.08 112 112
2 NPC-Tarapur (3 & 4) 1,292 1,292 - 3.10 401 401
3 NPC-Kakrapar 504 504 - 2.39 120 120
4 NTPC-Vindhyachal – I 1,613 1,613 23 1.62 261 284
5 NTPC-Vindhyachal – II 1,796 1,796 128 1.52 273 401
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Fixed Variable Variable Total

Available Dispatch
Sr. Cost Cost Cost Cost
Name of the Station
No. (Rs. (Rs. (Rs.
(MUs) (MUs) (Rs. Cr.)
Cr.) /kWh) Cr.)
6 NTPC-Vindhyachal – III 2,076 2,076 212 1.52 316 528
7 NTPC-Korba 2,651 2,651 23 1.46 387 410
8 NTPC-Korba –II 717 717 98 1.43 103 201
9 NTPC-Kawas 696 696 113 2.56 178 291
10 NTPC-Jhanor 1,116 1,116 132 2.39 267 399
11 NTPC-Sipat-I 3,938 3,938 519 1.30 512 1031
12 NTPC-Sipat – II 1,445 1,445 250 1.35 195 445
13 NTPC-Kahlagaon 910 910 106 2.31 210 316
14 NTPC-Vindhyachal – IV 1,777 1,777 280 1.51 268 548
15 NTPC-Mauda 1,671 1,671 320 2.79 466 786
16 NTPC-Vindhyachal – V 765 765 118 1.57 120 238
17 NTPC-Mauda II 2,063 2,063 380 2.50 516 896
18 SSNNL 146 146 - 2.03 30 30
19 NTPC-Lara U#1 551 551 110 1.50 83 193
NTPC-Gadarwara Stage-I
20 1,067 1,067 152 1.50 160 312
U#1
NTPC-Gadarwara Stage-I
21 622 622 89 1.50 93 182
U#2
22 NTPC-Lara U#2 321 321 64 1.50 48 112
23 NPC Kakrapar Ext U#1 - - - 2.38 - -
24 NPC Kakrapar Ext U#2 - - - 2.38 - -
25 NTPC-Khargone U#1 647 647 129 1.50 97 226
26 NTPC-Khargone U#2 360 360 72 1.50 54 126
Sub Total 29,283 29,283 3,318 5,271 8,589

Others
1 Captive Power 2 2 - 2.13 - -
Renewable
1 Wind Farms 6,671 6,671 - 3.78 2522 2522
2 Solar 1,744 1,744 - 11.45 1997 1997
3 Small/Mini Hydal 55 55 - 3.39 19 19
4 Small/Mini Hydal (New) 44 44 - 3.29 14 14
5 Biomass 210 210 40 4.17 88 128
6 Solar(New) 950 950 - 2.66 253 253
7 Wind (New) 589 589 - 2.44 144 144
8 Others (New) 14 14 - 6.66 9 9
Sub Total 10,280 10,280 40 5,045 5,085
TOTAL 108944 99680 11900 24734 36634

Table 5-28: Projected Power Purchase cost for FY 2020-21

Availabl Dispatc Fixed Variabl Variabl Total
Sr.
e h Cost e Cost e Cost Cost
No Name of the Station
(Rs. (Rs. (Rs.
. (MUs) (MUs) (Rs.Cr.)
Cr.) /kWh) Cr.)
GSECL
1 GSECL Gandhinagar – 5 1,314 1,314 23 3.50 460 483
2 GSECL Wanakbori – 7 1,341 1,341 62 3.21 430 492
3 GSECL Utran Expan 250 159 - 5.35 85 85
4 GSECL Dhuvaran – 7 191 191 61 1.49 28 89
5 GSECL Dhuvaran – 8 361 361 86 1.28 46 132
6 GSECL Ukai 4,133 4,133 262 3.39 1401 1663

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Availabl Dispatc Fixed Variabl Variabl Total

Sr.
e h Cost e Cost e Cost Cost
No Name of the Station
(Rs. (Rs. (Rs.
. (MUs) (MUs) (Rs.Cr.)
Cr.) /kWh) Cr.)
7 GSECL Ukai Expan 3,500 3,500 447 3.04 1065 1512
8 GSECL Gandhinagar 3-4 2,052 166 204 3.74 62 266
9 GSECL Wanakbori 1-6 8,538 8,538 448 3.29 2809 3257
10 GSECL Sikka Expansion 2,790 844 629 3.65 308 937
11 GSECL Kutch Lignite 1-3 867 867 207 2.16 187 394
12 GSECL Kutch Lignite 4 247 247 62 1.98 49 111
13 GSECL Ukai Hydro 311 311 42 - - 42
14 GSECL Kadana Hydro 288 288 73 - - 73
15 BECL 3,481 3,481 879 2.15 748 1627
16 Dhuvaran CCPP III 30 30 159 5.77 17 176
17 GSECL Wanakbori Ext U#8 5,614 5,614 905 2.94 1651 2555
Sub Total 35308 31384 4,548 9349 13897

IPPs
Gujarat State Energy
1 2 2 49 6.11 1 50
Generation
Gujarat State Energy
2 187 154 180 5.19 80 260
Generation Expansion
Gujarat Industries Power Co
3 - - - 4.5 - -
Ltd (165 MW)
Gujarat Industries Power Co
4 1,411 1,411 129 1.71 241 370
Ltd (SLPP)
Gujarat Mineral Development
5 1,131 1,131 124 1.26 143 267
Corp.
Gujarat Industries Power Co
6 105 105 5 2.27 24 29
Ltd (145 MW)
Gujarat Industries Power Co
7 1,484 1,484 273 1.88 279 552
Ltd (SLPP - Exp)
8 GPPC Pipavav 167 167 325 4.37 73 398
9 Mundra UMPP CGPL 11,689 11,689 1,129 1.66 1943 3072
10 Adani Power Ltd 8,023 8,023 975 1.81 1450 2425
11 Essar Power Bid 2 2,464 2,464 354 1.92 473 827
12 ACB India Ltd 1,410 1,410 201 0.82 116 317
13 Power Exchange 3,000 150 - 4.50 68 68
14 Short Term Power Purchase 3,000 3,000 - 3.50 1050 1050
Sub Total 34073 31190 3744 5939 9683

Central Sector
1 NPC-Tarapur (1 & 2) 539 539 - 2.08 112 112
2 NPC-Tarapur (3 & 4) 1,292 1,292 - 3.10 401 401
3 NPC-Kakrapar 504 504 - 2.39 121 121
4 NTPC-Vindhyachal – I 1,613 1,613 23 1.62 262 285
5 NTPC-Vindhyachal – II 1,796 1,796 128 1.52 273 401
6 NTPC-Vindhyachal – III 2,076 2,076 212 1.52 316 528
7 NTPC-Korba 2,651 2,651 23 1.46 387 410
8 NTPC-Korba –II 717 717 98 1.43 103 201
9 NTPC-Kawas 696 696 113 2.56 178 291
10 NTPC-Jhanor 1,116 1,116 132 2.39 267 399
11 NTPC-Sipat-I 3,938 3,938 519 1.30 512 1031
12 NTPC-Sipat – II 1,445 1,445 250 1.35 194 444
13 NTPC-Kahlagaon 910 910 106 2.31 210 316
14 NTPC-Vindhyachal – IV 1,777 1,777 280 1.51 269 549
15 NTPC-Mauda 1,671 1,671 320 2.79 466 786

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Availabl Dispatc Fixed Variabl Variabl Total

Sr.
e h Cost e Cost e Cost Cost
No Name of the Station
(Rs. (Rs. (Rs.
. (MUs) (MUs) (Rs.Cr.)
Cr.) /kWh) Cr.)
16 NTPC-Vindhyachal – V 765 765 118 1.57 120 238
17 NTPC-Mauda II 2,063 2,063 380 2.50 516 896
18 SSNNL 146 146 - 2.03 30 30
19 NTPC-Lara U#1 551 551 110 1.50 83 193
NTPC-Gadarwara Stage-I
20 1,067 1,067 152 1.50 160 312
U#1
NTPC-Gadarwara Stage-I
21 1,067 1,067 152 1.50 160 312
U#2
22 NTPC-Lara U#2 551 551 110 1.50 83 193
23 NPC Kakrapar Ext U#1 139 139 10 2.38 33 43
24 NPC Kakrapar Ext U#2 139 139 10 2.38 33 43
25 NTPC-Khargone U#1 863 863 172 1.50 129 301
26 NTPC-Khargone U#2 863 863 172 1.50 129 301
Sub Total 30955 30955 3590 5547 9137

Others
1 Captive Power 2 2 - 2.13 - -
Renewable
1 Wind Farms 6,671 6,671 - 3.78 2522 2522
2 Solar 1,744 1,744 - 11.45 1997 1997
3 Small/Mini Hydal 55 55 - 3.39 19 19
4 Small/Mini Hydal (New) 44 44 - 3.29 14 14
5 Biomass 210 210 40 4.17 88 128
6 Solar(New) 2,161 2,161 - 2.54 549 549
7 Wind (New) 1,058 1,058 - 2.44 258 258
8 Others (New) 177 177 - 6.9 122 122
Sub Total 12,123 12,123 40 5,567 5,607
TOTAL 112459 105652 11923 26401 38323

5.8.3 Transmission and other Cost

Petitioner’s submission:

UGVCL has submitted that the total power purchase cost for the company for the
remaining control period, FY 2019-20 to FY 2020-21 consists of: Transmission
Charges, GUVNL cost and SLDC fees and charges.

5.8.3.1 Transmission charges

 Transmission charges to GETCO have been considered as per the approved
charges for GETCO in the MYT Order for the remaining control period FY 2019-
20 to FY 2020-21.
 PGCIL charges of FY 2017-18 are escalated at 5% y-o-y to derive PGCIL
charges for FY 2019-20 to FY 2020-21.
 SLDC Fees & Charges also have been considered as per the MYT Order of

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SLDC for FY 2019-20 & FY 2020-21.

Based on the transmission charges for PGCIL and GETCO, the transmission
costs included in the calculation of bulk supply tariff of all DISCOMs is given below:

Table 5-29: Projected Transmission charges for FY 2019-20 and FY 2020-21

(Rs. Crore)

Sr. No. Particulars 2019-20 2020-21

1 PGCIL Charges 2077 2181
2 Annual Transmission Charges of GETCO 4115 4502
3 SLDC Charges 16 15

5.8.3.2 GUVNL Cost

UGVCL has submitted that GUVNL is entrusted with the function of Bulk Power
Purchase on behalf of four Distribution Companies and Bulk Supply of power to
Distribution Companies for onwards retail supply to consumers, trading of Surplus
power on behalf of Distribution Companies and activities related to overall coordination
between the subsidiary companies. GVUNL is procuring power on behalf of all four
Discoms to have economical and optimized power purchase cost. It also undertakes
the function of raising and managing overall loan portfolio of GUVNL and its
subsidiaries.
GUVNL is charging Rs.0.04 for every transaction of the unit. The total cost has been
arrived at after considering the total dispatchable units required to be served to
all the four DISCOMs during FY 2019-20 to FY 2020-21 as shown below:

Table 5-30: GUVNL Cost for FY 2019-20 and FY 2020-21

(Rs. Crore)
Sr. No. Particulars 2019-20 2020-21
1 GUVNL Cost at 4.00 Paisa per Unit 399 423

5.8.4 Total Power Purchase Cost

The total power purchase cost consists of the cost of power purchase from various
generating stations, transmission charges of PGCIL and GETCO, SLDC charges,
GUVNL costs and trading units.
The total fixed costs, due to the capacity contracted, are passed on to the
DISCOMs as shown in the Table below:

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Table 5-31: Projected Fixed cost for DISCOMs for FY 2019-20 and FY 2020-21
(Rs. Crore)

Fixed GETCO PGCIL SLDC Total Fixed Discom

Year
Cost Cost Charges Charges Cost Fixed Cost
2019-20 11900 4115 2077 16 18108 18108
2020-21 11923 4502 2181 15 18621 18621

The Table below shows the total variable cost for FY 2019-20 to FY 2020-21

Table 5-32: Projected Variable cost for DISCOMs and trading of energy from FY 2019-20
and FY 2020-21
(Rs. Crore)

Total Variable
Variable GUVNL Dispatched Discom Variable
Year Variable Cost Rs./
Cost Cost (MUs) (MUs) Cost
Cost kWh
2019-20 24734 399 25132 99680 2.52 99680 25132
2020-21 26401 423 26824 105652 2.54 105652 26824

5.8.5 Net Power Purchase Cost

The net power purchase cost is shown in the Table below:

Table 5-33: Projected Net Power Purchase cost for FY 2019-20 and FY 2020-21
(Rs. Crore)

Discom Discom Total Power

Year
Fixed Cost Variable Cost Purchase Cost
2019-20 18108 25132 43241
2020-21 18621 26824 45445

5.8.6 Bulk Supply Tariff (BST)

The Objective of the differentiation of the BST between DISCOMs is due to the fact
that the revenue from tariffs for each DISCOMs are different due to different consumer
mix and therefore, it is necessary to build a mechanism in the projections to bring them
to a level playing field. The basic objective of Bulk Supply Tariff is that:
 GUVNL shall purchase power from various sources in bulk and supply power
in bulk to DISCOMs for onward retail supply.
 To ensure uniform retail consumer tariffs in four state owned DISCOMs.
 Since each of the DISCOMs were incorporated on the basis of earlier zonal
system, the consumer mix and consumption mix is different for each DISCOM.
Consequently, the revenue earning capability of each DISCOM is different.
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 It is necessary to build a mechanism to bring them to a level playing field in

their paying capacity for power purchase to be achieved through Bulk Supply
Tariff (BST) to each of the DISCOMs.
By undertaking the BST method, it would be possible to ensure uniform retail consumer
tariffs in the four DISCOMs.

5.9 Power Purchase Cost – Commission’s analysis

5.9.1 Power Purchase Sources

As mentioned in Para 5.8.1, UGVCL has submitted that GUVNL has entered into
contracts for the existing capacity with GSECL, Central Generating Companies, IPPs,
renewable energy sources, Hydro, Solar, Wind, Other RE Sources, IPPs and Power
tied up through competitive bidding etc. The details of the existing plants are given in
Table 5-24. GUVNL has also entered into contract for additional capacity likely to be
commissioned during FY 2019-20 and FY 2020-21. The details of additional plants
likely to be commissioned during FY 2019-20 and FY 2020-21 are given in Table 5-25.
The capacity approved by the Commission in the MYT Order dated 31st March, 2017
and projected by petitioner in Mid-Term Review from each of the sources are
summarised in the Table below:

Table 5-34: Capacity Contracted Source – Wise by GUVNL in the MYT Order and Now
Submitted by UGVCL for the period FY 2019-20 and FY 2020-21
(MW)

2019-20 2020-21
SI.
Particulars Approved in Projected in Approved in Projected in
No.
MYT Order the MTR MYT Order the MTR
1 GSECL 6817 6817 8417 6817
2 IPPs 2001 2166 2001 2166
3 Central Generating
5577 6740 5654 7216
Stations
4 Renewable 3409 4863 3409 4863
5 Competitive Bidding 5005 3884 5005 3884
6 Others – CPP 8 8 8 8
7 Total 22817 24478 24494 24954

5.9.2 Power Purchase during FY 2019-20 and FY 2020-21

The power purchase for the period FY 2019-20 and FY 2020-21 is based on the energy
requirement of UGVCL / four DISCOMs approved by the Commission.

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The source wise Power available and dispatchable units based on the merit despatch
in the MYT Order and as projected in Mid-Term Review for FY 2019-20 and FY 2020-
21 are given in the Table below:

Table 5-35: Energy Available & Dispatchable as approved in MYT order and projected
in MTR for FY 2019-20
Approved in the MYT Order Projected in MTR
Sr.
Particulars Available Dispatch Availabe Dispatch
No.
MUs MUs MUs MUs
GSECL
1 GSECL Gandhinagar – 5 1339 84 1,314 1,314
2 GSECL Wanakbori – 7 1339 84 1,341 1,341
3 GSECL Utran Expan 1910 32 250 159
4 GSECL Dhuvaran – 7 362 45 191 191
5 GSECL Dhuvaran – 8 382 48 361 361
6 GSECL Ukai 3890 243 4,133 4,133
7 GSECL Ukai Expan 3294 395 3,500 3,500
8 GSECL Gandhinagar 3-4 2649 166 2,052 166
9 GSECL Wanakbori 1-6 8035 502 8,538 8,538
10 GSECL Sikka Expansion 3189 3189 2,790 199
11 GSECL Kutch Lignite 1-3 1243 1243 867 867
12 GSECL Kutch Lignite 4 463 463 247 247
13 GSECL Ukai Hydro 478 478 311 311
14 GSECL Kadana Hydro 287 287 288 288
15 BECL 3084 3084 3,481 3,481
16 Dhuvaran CCPP III 1917 32 30 30
17 GSECL Wanakbori Ext U#8 5608 330 5,614 5,614
Sub Total 39471 10704 35,308 30,740

IPP's
Gujarat State Energy
1 795 13 2 2
Generation
Gujarat State Energy
2 1845 31 187 154
Generation Expansion
Gujarat Industries Power Co
3 - - - -
Ltd (165 MW)
Gujarat Industries Power Co
4 1433 1433 1,411 1,411
Ltd (SLPP)
Gujarat Mineral Development
5 1577 1577 1,131 1,131
Corp.
Gujarat Industries Power Co
6 214 4 105 105
Ltd (145 MW)
Gujarat Industries Power Co
7 1265 1265 1,484 1,484
Ltd (SLPP - Exp)
8 GPPC Pipavav 472 60 167 167
9 Mundra UMPP CGPL 12649 12649 11,689 11,689
10 Adani Power Ltd 14892 14892 8,023 8,023
11 Essar Power Bid 2 7446 7446 2,464 2,464
12 ACB India Ltd 1489 1489 1,410 1,410
13 Power Exchange - - 3,000 150
14 Short Term Power Purchase - - 3,000 1,187
Sub Total 44077 40859 34,073 29,377

Central Sector
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Approved in the MYT Order Projected in MTR

Sr.
Particulars Available Dispatch Availabe Dispatch
No.
MUs MUs MUs MUs
1 NPC-Tarapur (1 & 2) 1072 1072 539 539
2 NPC-Tarapur (3 & 4) 1836 1836 1,292 1,292
3 NPC-Kakrapar 814 814 504 504
4 NTPC-Vindhyachal – I 1467 1467 1,613 1,613
5 NTPC-Vindhyachal – II 1566 1566 1,796 1,796
6 NTPC-Vindhyachal – III 1859 1852 2,076 2,076
7 NTPC-Korba 2506 2506 2,651 2,651
8 NTPC-Korba –II 668 668 717 717
9 NTPC-Kawas 636 79 696 696
10 NTPC-Jhanor 806 101 1,116 1,116
11 NTPC-Sipat-I 3759 3759 3,938 3,938
12 NTPC-Sipat – II 1901 1901 1,445 1,445
13 NTPC-Kahlagaon 924 924 910 910
14 NTPC-Vindhyachal – IV 1573 1573 1,777 1,777
15 NTPC-Mauda 1573 98 1,671 1,671
16 NTPC-Vindhyachal – V 612 612 765 765
17 NTPC-Mauda II U#1 & U#2 2064 2064 2,063 2,063
18 SSNNL 335 335 146 146
19 NTPC-Lara U#1 982 982 551 551
20 NTPC-Gadarwara Stage-I U#1 772 772 1,067 1,067
21 NTPC-Gadarwara Stage-I U#2 772 772 622 622
22 NTPC-Lara U#2 982 982 321 321
23 NPC Kakrapar Ext U#1 1542 1542 - -
24 NPC Kakrapar Ext U#2 1542 1542 - -
25 NTPC-Khargone U#1 515 515 647 647
26 NTPC-Khargone U#2 193 193 360 360
27 NTPC-North Karanpura U#1 540 540 - -
28 NTPC-North Karanpura U#2 270 270 - -
Sub Total 34081 31337 29283 29283

Others
1 Captive Power 6 6 2 2
Renewable
1 Wind Farms 4280 4280 6,671 6,671
2 Solar 1368 1368 1,744 1,744
3 Small/Mini Hydal 45 45 55 55
4 Small/Mini Hydal (New) - - 44 44
5 Biomass 1 1 210 210
6 Solar(New) 3832 3832 950 950
7 Wind (New) 3331 3331 589 589
8 Others (New) 663 663 14 14
Sub Total 13526 13526 10,280 10,280
TOTAL 131154 96426 1,08,944 99,680

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Table 5-36: Energy Available & Dispatchable as approved in MYT order and projected in MTR
for FY 2020-21
Approved in the MYT Order Projected in MTR

Sr.
Particulars Available Dispatch Available Dispatch
No.
MUs MUs MUs MUs

GSECL
1 GSECL Gandhinagar – 5 1339 84 1,314 1,314
2 GSECL Wanakbori – 7 1339 84 1,341 1,341
3 GSECL Utran Expan 1910 32 250 159
4 GSECL Dhuvaran – 7 362 45 191 191
5 GSECL Dhuvaran – 8 382 48 361 361
6 GSECL Ukai 3890 243 4,133 4,133
7 GSECL Ukai Expan 3294 854 3,500 3,500
8 GSECL Gandhinagar 3-4 2649 166 2,052 166
9 GSECL Wanakbori 1-6 8035 502 8,538 8,538
10 GSECL Sikka Expansion 3189 3189 2,790 844
11 GSECL Kutch Lignite 1-3 1243 1243 867 867
12 GSECL Kutch Lignite 4 463 463 247 247
13 GSECL Ukai Hydro 478 478 311 311
14 GSECL Kadana Hydro 287 287 288 288
15 BECL 3084 3084 3,481 3,481
16 Dhuvaran CCPP III 1917 32 30 30
17 GSECL Wanakbori Ext U#8 5608 330 5,614 5,614
18 Dhuvaran STPS 11217 660 - -
Sub Total 50688 11824 35,308 31,384

IPP's
Gujarat State Energy
1 795 13 2 2
Generation
Gujarat State Energy
2 1845 31 187 154
Generation Expansion
Gujarat Industries Power Co
3 1433 1433 1,411 1,411
Ltd (SLPP)
Gujarat Mineral Development
4 1577 1577 1,131 1,131
Corp.
Gujarat Industries Power Co
5 214 4 105 105
Ltd (145 MW)
Gujarat Industries Power Co
6 1265 1265 1,484 1,484
Ltd (SLPP - Exp)
7 GPPC Pipavav 472 60 167 167
8 Mundra UMPP CGPL 12649 12649 11,689 11,689
9 Adani Power Ltd 14892 14892 8,023 8,023
10 Essar Power Bid 2 7446 7446 2,464 2,464
11 ACB India Ltd 1489 1489 1,410 1,410
12 Power Exchange - - 3,000 150
13 Short Term Power Purchase - - 3,000 3,000
Sub Total 44077 40859 34,073 31,190

Central Sector
1 NPC-Tarapur (1 & 2) 1072 1072 539 539
2 NPC-Tarapur (3 & 4) 1836 1836 1,292 1,292
3 NPC-Kakrapar 814 814 504 504
4 NTPC-Vindhyachal – I 1467 1467 1,613 1,613
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Approved in the MYT Order Projected in MTR

Sr.
Particulars Available Dispatch Available Dispatch
No.
MUs MUs MUs MUs

5 NTPC-Vindhyachal – II 1566 1566 1,796 1,796

6 NTPC-Vindhyachal – III 1859 1852 2,076 2,076
7 NTPC-Korba 2506 2506 2,651 2,651
8 NTPC-Korba –II 668 668 717 717
9 NTPC-Kawas 636 79 696 696
10 NTPC-Jhanor 806 101 1,116 1,116
11 NTPC-Sipat-I 3759 3759 3,938 3,938
12 NTPC-Sipat – II 1901 1901 1,445 1,445
13 NTPC-Kahlagaon 924 924 910 910
14 NTPC-Vindhyachal – IV 1573 1573 1,777 1,777
15 NTPC-Mauda 1573 98 1,671 1,671
16 NTPC-Vindhyachal – V 612 612 765 765
17 NTPC-Mauda II U#1 & U#2 2064 2064 2,063 2,063
18 SSNNL 335 335 146 146
19 NTPC-Lara U#1 982 982 551 551
20 NTPC-Gadarwara Stage-I U#1 772 772 1,067 1,067
21 NTPC-Gadarwara Stage-I U#2 772 772 1,067 1,067
22 NTPC-Lara U#2 982 982 551 551
23 NPC Kakrapar Ext U#1 1542 1542 139 139
24 NPC Kakrapar Ext U#2 1542 1542 139 139
25 NTPC-Khargone U#1 772 772 863 863
26 NTPC-Khargone U#2 772 772 863 863
27 NTPC-North Karanpura U#1 540 540 - -
28 NTPC-North Karanpura U#2 540 540 - -
29 NTPC-North Karanpura U#3 540 540 - -
Sub Total 35727 32986 30,955 30,955

Others
1 Captive Power 6 6 2 2
Renewable
1 Wind Farms 4280 4280 6,671 6,671
2 Solar 1368 1368 1,744 1,744
3 Small/Mini Hydal 45 45 55 55
4 Small/Mini Hydal (New) - - 44 44
5 Biomass 1 1 210 210
6 Solar (New) 5332 5332 2,161 2,161
7 Wind (New) 3809 3809 1,058 1,058
8 Others (New) 699 699 177 177
Sub Total 15540 15540 12,123 12,123
TOTAL 146031 101205 112459 105652

The availability and dispatchable energy from all sources projected by UGVCL in the
Mid-Term Review for FY 2019-20 and FY 2020-21 and as approved by the
Commission in the MYT Order dated 31st March, 2017 are summarised below:

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Table 5-37: Availability and Dispatchable as approved in MYT Order and as Projected in
MTR for FY 2019-20 and FY 2020-21
(MUs)

SI. Approved in MYT Order Projected in MTR

Particulars
No. 2019-20 2020-21 2019-20 2020-21
1 Available 131154 146031 108944 112459
2 Dispatchable 96426 101205 99680 105652

The availability projected in the Mid-Term Review of FY 2019-20 and FY 2020-21 is

less by 22210 MUs during FY 2019-20 and 33572 MUs during FY 2020-21 compared
to availability approved in the MYT order. The reduced availability is due to delay in
commissioning of some of the generating stations.

5.9.3 Merit Order dispatch and Total Energy requirement including

tradable energy

As discussed in Para 5.8.1, GUVNL has entered into contract for the existing capacity
with GSECL, Central generating stations, IPPs, renewable energy sources and power
tied up through competitive bidding. The details of existing plants etc., are given in
Table 5-24.
GUVNL has also entered in to contract for new capacity that is likely to be
commissioned during FY 2019-20 and FY 2020-21. The details of new plants likely to
be commissioned during FY 2019-20 and FY 2020-21 are given in Table 5-25.
The details of capacity contracted by GUVNL, from the existing plant and the additional
plants envisaged during FY 2019-20 and FY 2020-21 with operational parameters,
fixed and variable costs are given in Tables 5-27 and 5-28.

Power Purchase in merit order

As discussed in Para 5.8.2, in order to optimize the Power Purchase Cost GVUNL has
worked out a comprehensive merit order despatch (MOD).
The quantum of power dispatchable (to be purchased) is arrived at based on the
energy available from various sources less energy requirement by the four DISCOMs
and energy that could be traded by GUVNL as given in the Table below:

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Table 5-38: Energy requirement and Energy dispatchable as projected by the DISCOMs

Energy Requirement (MUs)

Sr. No. DISCOM
2019-20 2020-21
1 DGVCL 22552 23688
2 MGVCL 12523 13256
3 UGVCL 26849 28680
4 PGVCL 37757 40028
5 Total requirement of four DISCOMs 99680 105652
6 Tradable energy projected by GUVNL 0 0
7 Total Despatch units 99680 105652

Though the availability is in the order of 108944 MUs and 112459 MUs during FY 2019-
20 and FY 2020-21, the despatch is limited to 99680 MUs and 105652 MUs as above
to meet the total requirement of the four DISCOMs.
The projected dispatchable energy is about 91.49% of the projected available energy
during FY 2019-20 (the available energy being 108944 MUs and dispatchable energy
99680 MUs) and 93.95% during FY 2020-21 (the available energy being 112459 and
dispatchable energy 105652 MUs) as shown in Tables 5-37.
The Commission in the analysis of energy sales projected by DISCOMs has approved
energy sales and energy requirement of each DISCOM.
The energy requirement projected and energy requirement approved for each
DISCOM by the Commission are summarised below:

Table 5-39: Energy requirement projected and approved for each DISCOM for
(MUs)

Energy Requirement
Sr.
DISCOM 2019-20 2020-21
No.
Projected Approved Projected Approved
1 DGVCL 22552 22552 23688 23688
2 MGVCL 12523 12523 13256 13256
3 PGVCL 37757 37757 40028 40028
4 UGVCL 26849 26849 28680 28680
Total requirement of four
5 99680 99680 105652 105652
DISCOMs
Tradable energy projected by
6 - - - -
GUVNL
7 Total Despatch units 99680 99680 105652 105652

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5.9.4 Power Purchase Cost for the period FY 2019-20 and FY 2020-21

UGVCL has submitted the power purchase costs as given in Table 5.33.

It is observed that Petitioner has not projected the purchase of power in accordance
with the RPO requirement. The Commission has therefore, worked out the purchase
of power from renewable sources in accordance with the RPO Regulations. Further,
while considering the power purchase requirement, the merit order dispatch has been
applied as specified in Para 5.8.2 above. It is also observed by the Commission that
the Petitioner inadvertently not considered fixed cost of Utran Expansion for FY 2020-
21. The Commission has considered the same.
Also, the fixed cost and variable cost for GSECL stations, IPPs, renewable and Central
plants are taken as per actuals of FY 2017-18 as base power purchase cost. The
approved requirement of power for all the DISCOMs put together, the Trading Units
and revised dispatchable units for the FY 2019-20 and FY 2020-21 as discussed above
are given in the Tables below:

Table 5-40: Approved Power Purchase Cost for FY 2019-20

Fixed Variabl Variabl Total
Sr. Available Dispatch Cost e Cost e Cost Cost
Particulars
No. (MUs) (MUs) (Rs. (Rs. (Rs. (Rs.
Crore) /Unit) Crore) Crore)
GSECL
1 GSECL Gandhinagar – 5 1,314 84 23 3.50 29 52
2 GSECL Wanakbori – 7 1,341 1,341 62 3.21 430 492
3 GSECL Utran Expan 250 159 250 5.35 85 335
4 GSECL Dhuvaran – 7 191 191 61 1.49 28 89
5 GSECL Dhuvaran – 8 361 361 86 1.28 46 132
6 GSECL Ukai 4,133 2,424 262 3.39 822 1084
7 GSECL Ukai Expan 3,500 3,500 447 3.04 1065 1512
8 GSECL Gandhinagar 3-4 2,052 166 204 3.74 62 266
9 GSECL Wanakbori 1-6 8,538 8,538 448 3.29 2809 3257
10 GSECL Sikka Expansion 2,790 199 629 3.65 73 702
11 GSECL Kutch Lignite 1-3 867 867 207 2.16 187 394
12 GSECL Kutch Lignite 4 247 247 62 1.98 49 111
13 GSECL Ukai Hydro 311 311 42 0.00 0 42
14 GSECL Kadana Hydro 288 288 73 0.00 0 73
15 BECL 3,481 3,481 879 2.15 748 1627
16 Dhuvaran CCPP III 30 30 159 5.77 17 176
GSECL Wanakbori Ext
17 5,614 5,614 905 2.94 1651 2555
U#8
Sub Total 35,308 27,800 4,798 8103 12,901

IPPs

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Fixed Variabl Variabl Total

Sr. Available Dispatch Cost e Cost e Cost Cost
Particulars
No. (MUs) (MUs) (Rs. (Rs. (Rs. (Rs.
Crore) /Unit) Crore) Crore)
Gujarat State Energy
1 2 2 49 6.11 1 50
Generation
Gujarat State Energy
2 187 154 180 5.19 80 260
Generation Expansion
Gujarat Industries Power
3 0 0 0 4.50 0 0
Co Ltd (165 MW)
Gujarat Industries Power
4 1,411 1,411 129 1.71 241 370
Co Ltd (SLPP)
Gujarat Mineral
5 1,131 1,131 124 1.26 142 266
Development Corp.
Gujarat Industries Power
6 105 105 5 2.27 24 29
Co Ltd (145 MW)
Gujarat Industries Power
7 1,484 1,484 273 1.88 279 552
Co Ltd (SLPP - Exp)
8 GPPC Pipavav 167 167 325 4.37 73 398
9 Mundra UMPP CGPL 11,689 11,689 1,129 1.66 1943 3072
10 Adani Power Ltd 8,023 8,023 975 1.81 1450 2425
11 Essar Power Bid 2 2,464 2,464 354 1.92 473 827
12 ACB India Ltd 1,410 1,410 201 0.82 115 316
13 Power Exchange 3,000 150 0 4.50 68 68
Short Term Power
14 Purchase / Power 3,000 150 0 3.50 52 52
Exchange
Sub Total 34,073 28,340 3,744 4941 8,685

Central Sector
1 NPC-Tarapur (1 & 2) 539 539 0 2.08 112 112
2 NPC-Tarapur (3 & 4) 1,292 1,292 0 3.10 400 400
3 NPC-Kakrapar 504 504 0 2.39 121 121
4 NTPC-Vindhyachal – I 1,613 1,613 23 1.62 262 285
5 NTPC-Vindhyachal – II 1,796 1,796 128 1.52 273 401
6 NTPC-Vindhyachal – III 2,076 2,076 212 1.52 316 528
7 NTPC-Korba 2,651 2,651 23 1.46 387 410
8 NTPC-Korba –II 717 717 98 1.43 103 201
9 NTPC-Kawas 696 696 113 2.56 178 291
10 NTPC-Jhanor 1,116 1,116 132 2.39 267 399
11 NTPC-Sipat-I 3,938 3,938 519 1.30 513 1032
12 NTPC-Sipat – II 1,445 1,445 250 1.35 194 444
13 NTPC-Kahlagaon 910 910 106 2.31 210 316
14 NTPC-Vindhyachal – IV 1,777 1,777 280 1.51 269 549
15 NTPC-Mauda 1,671 1,671 320 2.79 466 786
16 NTPC-Vindhyachal – V 765 765 118 1.57 120 238
17 NTPC-Mauda II 2,063 2,063 380 2.50 516 896
18 SSNNL 146 146 0 2.03 30 30

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Fixed Variabl Variabl Total

Sr. Available Dispatch Cost e Cost e Cost Cost
Particulars
No. (MUs) (MUs) (Rs. (Rs. (Rs. (Rs.
Crore) /Unit) Crore) Crore)
19 NTPC-Lara U#1 551 551 110 1.50 83 193
NTPC-Gadarwara Stage-I
20 1,067 1,067 152 1.50 160 312
U#1
NTPC-Gadarwara Stage-I
21 622 622 89 1.50 93 182
U#2
22 NTPC-Lara U#2 321 321 64 1.50 48 112
23 NPC Kakrapar Ext U#1 0 0 0 2.38 0 0
24 NPC Kakrapar Ext U#2 0 0 0 2.38 0 0
25 NTPC-Khargone U#1 647 647 129 1.50 97 226
26 NTPC-Khargone U#2 360 360 72 1.50 54 126
Sub Total 29,283 29,283 3,318 5271 8,589

Others
1 Captive Power 2 2 0 2.13 0 0
Renewable 0 0 0 0.00
1 Wind Farms 6,671 6,671 0 3.78 2520 2520
2 Solar 1,744 1,744 0 11.45 1997 1997
3 Small/Mini Hydal 55 55 0 3.39 19 19
4 Small/Mini Hydal (New) 44 44 0 3.29 15 15
5 Biomass 210 210 40 4.17 88 128
6 Solar (New) 3738 3,738 0 2.66 996 996
7 Wind (New) 1353 1,353 0 2.44 330 330
8 Others (New) 438 438 0 6.66 292 292
Sub Total 14256 14,256 40 6256 6,296
TOTAL 112920 99680 11900 24572 36472

Table 5-41: Approved Power Purchase Cost for FY 2020-21

Variab
Fixed Variabl Total
Availa le
Sr. Dispatch Cost e Cost Cost
Particulars be Cost
No. (MUs) (Rs. (Rs. (Rs.
(MUs) (Rs.
Crore) Crore) Crore)
/Unit)
GSECL
1 GSECL Gandhinagar – 5 1,314 84 23 3.50 29 52
2 GSECL Wanakbori – 7 1,341 1,341 62 3.21 430 492
3 GSECL Utran Expan 250 159 250 5.35 85 335
4 GSECL Dhuvaran – 7 191 191 61 1.49 28 89
5 GSECL Dhuvaran – 8 361 361 86 1.28 46 132
6 GSECL Ukai 4,133 3,800 262 3.39 1289 1551
7 GSECL Ukai Expan 3,500 3,500 447 3.04 1065 1512
8 GSECL Gandhinagar 3-4 2,052 166 204 3.74 62 266
9 GSECL Wanakbori 1-6 8,538 8,538 448 3.29 2809 3257

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Variab
Fixed Variabl Total
Availa le
Sr. Dispatch Cost e Cost Cost
Particulars be Cost
No. (MUs) (Rs. (Rs. (Rs.
(MUs) (Rs.
Crore) Crore) Crore)
/Unit)
10 GSECL Sikka Expansion 2,790 844 629 3.65 308 937
11 GSECL Kutch Lignite 1-3 867 867 207 2.16 187 394
12 GSECL Kutch Lignite - 4 247 247 62 1.98 49 111
13 GSECL Ukai Hydro 311 311 42 0.00 0 42
14 GSECL Kadana Hydro 288 288 73 0.00 0 73
15 BECL 3,481 3,481 879 2.15 748 1627
16 Dhuvaran CCPP III 30 30 159 5.77 17 176
GSECL Wanakbori Ext
17 5,614 5,614 905 2.94 1651 2555
U#8
Sub Total 35,308 29,821 4,798 8,805 13,603

IPPs
Gujarat State Energy
1 2 2 49 6.11 1 50
Generation
Gujarat State Energy
2 187 154 180 5.19 80 260
Generation Expansion
Gujarat Industries Power
3 0 0 0 4.50 0 0
Co Ltd (165 MW)
Gujarat Industries Power
4 1,411 1,411 129 1.71 241 370
Co Ltd (SLPP)
Gujarat Mineral
5 1,131 1,131 124 1.26 142 266
Development Corp.
Gujarat Industries Power
6 105 105 5 2.27 24 29
Co Ltd (145 MW)
Gujarat Industries Power
7 1,484 1,484 273 1.88 279 552
Co Ltd (SLPP - Exp)
8 GPPC Pipavav 167 167 325 4.37 73 398
9 Mundra UMPP CGPL 11,689 11,689 1,129 1.66 1943 3072
10 Adani Power Ltd 8,023 8,023 975 1.81 1450 2425
11 Essar Power Bid 2 2,464 2,464 354 1.92 473 827
12 ACB India Ltd 1,410 1,410 201 0.82 115 316
13 Power Exchange 3,000 150 0 4.50 68 68
Short Term Power
14 Purchase / Power 3,000 150 0 3.50 53 53
Exchange
Sub Total 34,073 28,340 3,744 4,941 8,685

Central Sector
1 NPC-Tarapur (1 & 2) 539 539 0 2.08 112 112
2 NPC-Tarapur (3 & 4) 1,292 1,292 0 3.10 400 400
3 NPC-Kakrapar 504 504 0 2.39 121 121
4 NTPC-Vindhyachal – I 1,613 1,613 23 1.62 262 285
5 NTPC-Vindhyachal – II 1,796 1,796 128 1.52 273 401
6 NTPC-Vindhyachal – III 2,076 2,076 212 1.52 316 528
7 NTPC-Korba 2,651 2,651 23 1.46 387 410
8 NTPC-Korba –II 717 717 98 1.43 103 201
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Variab
Fixed Variabl Total
Availa le
Sr. Dispatch Cost e Cost Cost
Particulars be Cost
No. (MUs) (Rs. (Rs. (Rs.
(MUs) (Rs.
Crore) Crore) Crore)
/Unit)
9 NTPC-Kawas 696 696 113 2.56 178 291
10 NTPC-Jhanor 1,116 1,116 132 2.39 267 399
11 NTPC-Sipat-I 3,938 3,938 519 1.30 513 1032
12 NTPC-Sipat – II 1,445 1,445 250 1.35 194 444
13 NTPC-Kahlagaon 910 910 106 2.31 210 316
14 NTPC-Vindhyachal – IV 1,777 1,777 280 1.51 269 549
15 NTPC-Mauda 1,671 1,671 320 2.79 466 786
16 NTPC-Vindhyachal – V 765 765 118 1.57 120 238
17 NTPC-Mauda II 2,063 2,063 380 2.50 516 896
18 SSNNL 146 146 0 2.03 30 30
19 NTPC-Lara U#1 551 551 110 1.50 83 193
NTPC-Gadarwara Stage-I
20 1,067 1,067 152 1.50 160 312
U#1
NTPC-Gadarwara Stage-I
21 1,067 1,067 152 1.50 160 312
U#2
22 NTPC-Lara U#2 551 551 110 1.50 83 193
23 NPC Kakrapar Ext U#1 139 139 10 2.38 33 43
24 NPC Kakrapar Ext U#2 139 139 10 2.38 33 43
25 NTPC-Khargone U#1 863 863 172 1.50 129 301
26 NTPC-Khargone U#2 863 863 172 1.50 129 301
Sub Total 30,955 30,955 3,590 5,547 9,137

Others
1 Captive Power 2 2 0 2.13 0.43 0.43
Renewable 0 0
1 Wind Farms 6,671 6,671 0 3.78 2520 2,520
2 Solar 1,744 1,744 0 11.45 1997 1,997
3 Small/Mini Hydal 55 55 0 3.39 19 19
4 Small/Mini Hydal (New) 44 44 0 3.29 15 15
5 Biomass 210 210 40 4.17 88 128
6 Solar(New) 5387 5,387 0 2.54 1368 1,368
7 Wind (New) 1939 1,939 0 2.44 473 473
8 Others (New) 483 483 0 6.90 333 333
Sub Total 16536 16536 40 6812 6852
TOTAL 116872 105652 12173 26105 38277

The Commission has considered the despatchable and available energy from the
sources considered by the Petitioner to arrive at projection of Power Purchase Cost
for FY 2019-20 and FY 2020-21, however, the Petitioner shall follow the Merit Order
Principles and Prudence Practices while availing power from different sources.

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5.9.5 Transmission and Other Costs

5.9.5.1 Transmission Cost

Transmission cost include the cost to be paid to PGCIL for regional transmission and
cost of GETCO for intra-state transmission.
Transmission charges of PGCIL are approved by the CERC and to be paid by GUVNL
on the basis of calculation of Regional Energy Account of Western Region by WRLDC,
hence the Commission accepts the projection of UGVCL/GUVNL for PGCIL charges.
These charges are escalated at 5.72% y-o-y considering the actual charges of FY
2017-18 as the base.
The Petitioner has submitted that the Transmission charges of GETCO have been
considered as per the MYT Order of GETCO for FY 2019-20 and FY 2020-21. The
Commission has considered the Transmission charges of GETCO as approved in the
MYT Order dated 31st March, 2017. The Commission accordingly approves the
Transmission Charges payable to PGCIL and GETCO as given in the Table below:

Table 5-42: Transmission charges approved by the Commission for period

(Rs. Crore)

SI. No. Particulars 2019-20 2020-21

1 PGCIL Charges (Rs.Cr/annum) 2077 2181
2 Annual Transmission charges of GETCO (Rs. Crore) 4115 4502

5.9.5.2 GUVNL Cost

UGVCL has submitted in Para 5.8.3 above that GUVNL is charging Rs. 0.04 for every
transaction of one unit of energy for providing the services of procuring power and
supply to DISCOMs, the overall co-ordination between the subsidiary companies and
also undertaking the function of raising and managing the overall loan portfolio of
GUVNL and its subsidiaries.
The Commission observed that the charges of Rs. 0.04/unit to handle power
procurement and supply etc., as approved in MYT Order are reasonable and
accordingly, approves the GUVNL cost as given below, based on energy handled
during FY 2019-20 and FY 2020-21.

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Table 5-43: GUVNL Costs approved by the Commission for the period FY 2019-20 and
FY 2020-21

Sr. No. Particulars Unit 2019-20 F2020-21

1 Energy handled MUs 99680 105652
2 GUVNL Cost at 4.00 Paise/unit Rs. Crore 399 423

5.9.5.3 SLDC Fees and Charges

UGVCL has submitted that SLDC fees and charges have been taken as approved by
the Commission in SLDC MYT Order dated 31st March, 2017.
The Commission approves the SLDC charges in Mid Term review order in respect to
SLDC for FY 2019-20 and FY 2020-21 as given in Table below:

Table 5-44: SLDC charges approved by the Commission for FY 2019-20 and FY 2020-21
(Rs. Crore)
SI. No. Particulars 2019-20 2020-21
1 SLDC Charges 29 33

5.9.6 Total Power Purchase Cost

5.9.6.1 Fixed Cost

The total fixed cost consists of the fixed cost of the energy procured from various
sources, transmission costs of PGCIL and GETCO, SLDC Charges & fees and Trading
Costs approved by the Commission. These are aggregated to arrive at the total fixed
cost of power purchase for all DISCOMs.

The fixed costs due to capacity contracted by GUVNL are passed on to DISCOMs as
given in the Table below:

Table 5-45: Fixed cost of DISCOMs for the period FY 2019-20 and FY 2020-21
(Rs. Crore)
Fixed GETCO PGCIL SLDC Total Fixed DISCOMS
Year
Cost Cost Charges Charges Cost Fixed Cost
2019-20 11,900 4115 2077 29 18121 18121
2020-21 12,173 4502 2181 33 18888 18888

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5.9.6.2 Variable Costs

The total variable cost consists of the variable cost of energy supplied to DISCOMs
and GUVNL cost. The total variable cost and variable cost per unit are given in the
Table below:

Table 5-46: Variable cost for DISCOMs and Trading Units for the period FY 2019-20 and
FY 2020-21

Variable GUVNL Total Variable Variable

Total MUs
Year Cost (Rs. Cost (Rs. Cost (Rs. Cost (Rs.
Despatched
Crore Crore Crore) /Unit

2019-20 24572 399 24971 99680 2.51

2020-21 26105 423 26528 105652 2.51

Table 5-47: Total Cost of Power for DISCOMs for FY 2019-20 and FY 2020-21
(Rs. Crore)
Total
Total Fixed
Year Variable Total Cost
Cost
Cost
2019-20 18121 24971 43092
2020-21 18888 26528 45416

5.10 Allocation of Power Purchase Cost

Power Purchase Cost worked out as above for FY 2019-20 and FY 2020-21 is
allocated based on the methodology adopted by the Commission in the MYT Order
dated 31st March, 2017 by working out revenue available for purchase of power, Non-
Tariff Income, Agricultural Subsidy and Aggregate Revenue requirement other than
power purchase as given in the following Tables:

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Table 5-48: Category Wise sales approved and existing average tariff in Rs./kWh
DGVCL MGVCL PGVCL UGVCL
2019- 2020- Averag 2020- Averag Averag
2019-20 2020-21 Averag Averag 2019-20 2020-21 Averag 2019-20
Average Average 20 21 e Tariff 21 e Tariff e Tariff
Sr. e Tariff e Tariff e Tariff
Category Tariff Tariff Rs./kW Rs./kW Rs./kW
No. Rs./kW Rs./kW Rs./kW
Sales Sales Rs./kWh Rs./kWh Sales Sales Sales Sales h Sales Sales h h
h 2019- h 2020- h (2019-
(MUs) (MUs) 2019-20) 2020-21) (MUs) (MUs) (MUs) (MUs) (2020- (MUs) (MUs) (2019- (2020-
20) 21) 20)
21) 20) 21)
1 RGP 3400 3690 3.88 3.89 2801 2979 3.73 3.74 3996 4205 3.64 3.65 2418 2594 3.56 3.57
2 GLP 68 77 4.13 4.12 66 70 4.23 4.23 136 146 4.10 4.10 51 54 4.33 4.32
Non-RGP
3 5927 6,350 5.09 5.11 1,628 1716 5.42 5.44 3,744 3920 5.30 5.31 2,025 2,170 5.53 5.55
and LTMD
Public
4 Water 268 295 3.66 3.66 363 409 3.38 3.38 876 945 3.44 3.43 816 877 3.62 3.62
Works
Agriculture
5 417 417 1.41 1.41 475 475 1.41 1.41 4570 4570 1.42 1.42 6313 6313 1.41 1.41
Unmetered
Agriculture
6 461 499 1.19 1.19 933 1023 0.96 0.96 3601 4060 1.09 1.08 3119 3301 0.89 0.89
metered
7 Street Light 70 76 4.25 4.25 63 64 4.07 4.07 81 81 4.07 4.07 56 58 4.09 4.09
Industrial
8 8687 8901 5.40 5.45 4116 4339 5.35 5.39 12666 13932 5.11 5.15 8170 9218 5.08 5.06
HT
Railway
9 - - - - - - - - - - - - - - - -
Traction
10 Total 19297 20304 10446 11076 29668 31859 22968 24584

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Table 5-49: Revenue with existing Tariffs for FY 2019-20 and FY 2020-21 with approved sales
(Rs. Crore)
DGVCL MGVCL PGVCL UGVCL TOTAL
Sr. No. DISCOM
2019-20 2020-21 2019-20 2020-21 2019-20 2020-21 2019-20 2020-21 2019-20 2020-21
1 RGP 1318 1434 1044 1114 1456 1536 862 927 4680 5010
2 GLP 28 32 28 29 56 60 22 23 134 144
3 Non-RGP and LTMD 3019 3242 883 933 1983 2082 1119 1205 7003 7462
4 Public Water Works 98 108 123 138 301 325 296 318 817 889
Agriculture Unmetered 59 59 67 67 649 649 889 889 1664 1664
5 Agriculture Metered 55 59 90 99 392 439 278 295 815 892
6 Public Lighting 30 32 26 26 33 33 23 24 111 115
7 Industrial HT 4690 4852 2202 2338 6477 7174 4152 4662 17521 19026
8 Railway Traction 0 0 0 0 0 0 0 0 0 0
9 Total 9296 9817 4462 4745 11346 12299 7641 8343 32745 35204
Approved Sales
FPPPA @ 1.61 Rs./kWh
for FY 2019-20
10 3107 3208 1682 1750 4777 5034 3698 3884 13263 13876
and @ 1.58 Rs./kWh
for FY 2020-21
11 Other Income 235 235 109 109 215 215 203 203 763 763
12 Agriculture Subsidy 49 49 78 80 452 460 522 512 1100 1100
13 Grand Total 12687 13309 6331 6684 16790 18008 12063 12942 47871 50943

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Table 5-50: Aggregate Revenue Requirement for Power Purchase for FY 2019-20 and
FY 2020-21

(Rs. Crore)
Sr. No. Particulars 2019-20 2020-21
A Total Revenue of DISCOMS (A) 47871 50943
1 DGVCL 12687 13309
2 MGVCL 6331 6684
3 PGVCL 16790 18008
4 UGVCL 12063 12942
B Expenditure Other than Power Purchase (B) 5816 6296
5 DGVCL 991 1069
6 MGVCL 1001 1057
7 PGVCL 2609 2863
8 UGVCL 1214 1307
Amount available with the DISCOM for Power
C Purchase (A-B) 42055 44647
9 DGVCL 11695 12240
10 MGVCL 5330 5627
11 PGVCL 14180 15144
12 UGVCL 10849 11635

Table 5-51: Total Revenue Surplus/(Gap) for FY 2019-20 and FY 2020-21

(Rs. Crore)
Sr.
Particulars 2019-20 2020-21
No.
1 Total Power Purchase Cost (A) (As per Table 5.47) 43092 45416
Aggregate Amount available for Power Purchase (B) (As
2 42055 44647
per Table 5.50 C)
3 Surplus/(Gap)[B-A] (1037) (769)

Table 5-52: Energy Requirement and Percentage Energy required for FY 2019-20 and
FY 2020-21
2019-20 2020-21
Sr. Energy Energy
DISCOM
No. Required Percentage Required Percentage
(MUs) (MUs)
1 DGVCL 22552 23% 23688 22%
2 MGVCL 12523 13% 13256 13%
3 PGVCL 37757 38% 40028 38%
4 UGVCL 26849 27% 28680 27%
Total 99680 100% 105652 100%

Table 5-53: Allocation of Gap for FY 2019-20

Sr.
Details DGVCL MGVCL PGVCL UGVCL
No.
1 Total Gap for the year (Rs. Cr.) (1037)
2 Ratio of allocation of Gap 23% 13% 38% 27%
3 Gap allocation (Rs. Cr.) (235) (130) (393) (279)

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Table 5-54: Allocation of Gap for FY 2020-21

Sr.
Details DGVCL MGVCL PGVCL UGVCL
No.
1 Total Gap for the year (Rs. Cr.) (769)
2 Ratio of allocation of Gap 22% 13% 38% 27%
3 Gap allocation (Rs. Cr.) (172) (97) (291) (209)

Table 5-55: Bulk Supply Tariff for FY 2019-20

Sr.
Details DGVCL MGVCL PGVCL UGVCL
No.
Amount available for power purchase
1 11695 5330 14180 10849
(Rs. Cr.)
2 Gap allocated (Rs. Cr.) (235) (130) (393) (279)
Power purchase cost for DISCOM (1-
3 11930 5460 14573 11129
2) (Rs. Cr.)
4 Energy Purchase in DISCOM (MUs) 22552 12523 37757 26849
5 Bulk Supply Tariff (Rs./kWh) 5.29 4.36 3.86 4.14

Table 5-56: Bulk Supply Tariff for FY 2020-21

Sr.
Details DGVCL MGVCL PGVCL UGVCL
No.
Amount available for power purchase
1 12240 5627 15144 11635
(Rs. Cr.)
2 Gap allocated (Rs. Cr.) (172) (97) (291) (209)
Power purchase cost for DISCOM (1-
3 12413 5724 15436 11844
2) (Rs. Cr.)
4 Energy Purchase in DISCOM (MUs) 23688 13256 40028 28680
5 Bulk Supply Tariff (Rs./kWh) 5.24 4.32 3.86 4.13

5.11 Capital Expenditure

Petitioner’s submission
UGVCL has projected capital expenditure of Rs. 643.35 Crore for FY 2019-20 and Rs.
541.26 Crore for FY 2020-21 in Mid-Term Review against Rs. 541.81 Crore and Rs.
541.26 Crore approved in the MYT Order dated 31st March, 2017 as detailed in the
Table below:

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Table 5-57: Capital Expenditure loan in the Mid-Term Review for FY 2019-20 and FY 2020-21

(Rs. Crore)
2019-20 2020-21
Approved Approved
as per Projected as per Projected
Particulars
MYT in MTR MYT in MTR
Order Order
A Distribution Schemes
Normal Development Scheme 177.00 208.14 180.00 180.00
System Improvement Scheme 40.00 40.00 40.00 40.00
HVDS in selected Sub-division 4.50 4.50 4.50 4.50
Under Ground Cables 100.00 100.00 100.00 100.00
Plan Load Management Transformer 4.00 4.00 4.00 4.00
Others (VDS) 0.65 0.65 0.65 0.65
Total 326.15 357.29 329.15 329.15
B Rural Electrification Schemes – Plan - -
TASP(Wells & Petapara) 20.00 20.00 20.00 20.00
Schedule Caste Sub Plan (Wells) 4.00 4.00 3.00 3.00
Schedule Caste Sub Plan (lighting) 2.50 2.50 2.50 2.50
Electrification of Hutments 4.00 4.00 4.00 4.00
Kutir Jyoti Scheme 0.45 0.45 0.40 0.40
Dark Zone 100.00 140.00 100.00 100.00
Sagarkhedu 4.50 4.50 4.00 4.00
Sardar Krushi Jyoti (SKJY) Scheme - 16.40 - -
Solar home light 15.00 15.00 15.00 15.00
Total 150.45 206.85 148.90 148.90
C Central Government Scheme - Plan - -
Din Dayal Upadhyay Gramin Jyoti Yojana
- - - -
(DDUGJY)
RAPDRP Part A 2.05 2.05 2.05 2.05
Integrated Power Development Scheme
- - - -
(IPDS)
SCADA Part A 0.21 0.21 0.21 0.21
Smart grid 2.00 2.00 2.00 2.00
Total 4.26 4.26 4.26 4.26
D Non Plan Schemes - -
RE Non Plan (Tatkal) 2.00 2.00 1.00 1.00
AG Normal (SPA) 30.00 30.00 30.00 30.00
Energy Conservation 0.10 0.10 0.10 0.10
Total 32.10 32.10 31.10 31.10
E Other New Schemes - -
Automation and computerisation 4.35 4.35 4.35 4.35
Civil work New Building 12.00 12.00 12.00 12.00
GIS in cities 0.20 0.20 0.20 0.20
Other Schemes (earthing) 0.80 0.80 0.80 0.80
Other Repairing work / Civil work 2.00 2.00 2.00 2.00
New Furniture and Fixtures 1.00 1.00 1.00 1.00
Vehicles 0.50 0.50 0.50 0.50
DSM 2.00 2.00 2.00 2.00
DISS 5.00 15.00 - -
Solar Pump 5.00 5.00 5.00 5.00
Total 32.85 42.85 27.85 27.85
F Capital Expenditure Total 545.81 643.35 541.26 541.26

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UGVCL has furnished the justification for revision in the capital expenditure as given
below:

(A) Revised Capex : Looking to the present infrastructure growth among the
peripheral area of Ahmedabad and Gandhinagar hence the revision of capex for
the year 2019-20 is increased to Rs. 208.14 Crore from Rs. 177.00 Crore for FY
2019-20.Following is the revised Capex for the year FY 2019-20:

Particular 2019-20 (Revision) in Rs. Crore

A Distribution schemes
Normal Development scheme 208.14
SardarkrushiJyoti (SKJY) scheme 16.40
DISS Scheme 15.00
Dark Zone 140.00

(B) Distribution Schemes:

(a) SardarKrushiJyotiYojana - in this scheme capex is added for Rs. 16.40
Crore for FY 2019-20. This scheme includes the works like such as
replacement of deteriorated conductor and other maintenance works
(b) Diss – in Diss work, the budget is increased Rs. 15 Crore against
approved budget of Rs. 5 Crore for the FY 2019-20 as per revision in
targets.

(C) Rural Electrification Schemes:

The Scheme Wise Details for the projected capital expenditure for the MYT petition
under control period from FY 2019-20to FY 2020-21 is as follows:
 RE and non-plan Scheme: It is to state that Release of Agriculture Connection
is a Continuous process and it is governed by Government of Gujarat by
monitoring the Fund, availability of Energy and Infrastructure. Under the head RE
Schemes, the Company releases Agriculture category connections under
various schemes. There are 18078 Nos. of registered pending application for
Agriculture connections and also there are 18000 application per year registered
for Agriculture connections. Looking the flow of application, UGVCL has to carry
out the work for releasing agriculture connection about 15000-20000 Nos. of
wells per year. As the network has been extended year by year, hence average
cost per Ag. Wells has been decreased for each well. Hence UGVCL has

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projected Rs. 124.00 Crores, Rs. 123.00 Crores for the FY 2019-20 and FY 2020-
21 respectively.

Commission’s Approval
The Commission accepts the justification given by UGVCL for the projected capital
expenditure in the Mid-Term Review for FY 2019-20 and FY 2020-21 and approves
the capital expenditure of Rs. 643.35 Crore and Rs. 541.26 Crore for these years
respectively. The Commission has approved the scheme wise CAPEX as proposed by
the Petitioner for FY 2019-20 and FY 2020-21. While truing up, Petitioner is required
to submit the details of scheme wise CAPEX including target and actual date of
commissioning. The Commission shall allow such CAPEX after prudence check in
respect to cost incurred, time taken to complete the project and cost benefit analysis.
The Petitioner shall also justify the competitiveness of the cost incurred.

Capitalization and Funding

Petitioner’s Submission
UGVCL has submitted that it is expecting that all the capital expenditure incurred
during the year will be capitalised in the same year as per the past trends. The funding
of Capital Expenditure is envisaged through various sources categorised under four
headings namely: Consumer Contribution, Grants, Equity and Debt. UGVCL has
submitted that Consumer Contribution is the major source of funding the Normal
Distribution Schemes while Grant is received from State Government for funding
various governmental schemes like DDUGY, IPDS and others. The balance is
proposed to be funded through debt and equity in the ratio of 70:30. The detailed
breakup of approved and projected funding of capitalisation for FY 2019-20 to 2020-
21 is given in the Table below.

Table 5-58: Funding of Capitalisation projected in Mid-Term Review

(Rs. Crore)
2019-20 2020-21
Sr. Approved Approved
Particulars Projected Projected
No. in MYT in MYT
in MTR in MTR
Order Order
1 Capitalisation 545.81 643.35 541.26 541.26
2 Less : Consumer Contribution 72.65 72.65 73.20 73.20
3 Grants 129.95 129.95 122.90 122.90
4 Balance CAPEX 343.21 440.75 345.16 345.16
5 Debt @ 70% 240.25 308.53 241.61 241.61
6 Equity @ 30% 102.96 132.23 103.55 103.55

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Commission’s Analysis

The Commission has observed that UGVCL has proposed capitalization of the entire
capital expenditure proposed to be incurred during FY 2019-20 and FY 2020-21. The
Commission has verified the actual capitalization against capital expenditure incurred
during the first two financial years of the control period of the MYT and has observed
that the Petitioner has achieved more than 90% capitalization during FY 2016-17 and
more than 100% capitalization during FY 2017-18 as can be seen from the table below

Table 5-59: Approved CAPEX vs Actual CAPEX & Actual Capitalization for FY 2016-17
and FY 2017-18
(Rs. in Crore)
Particulars 2016-17 2017-18
Approved CAPEX in MYT Order 813.66 784.43
Actual CAPEX 517.82 629.31
Capitalization 474.83 672.04

In view of the above, the Commission approves the capitalization and funding thereof
proposed by UGVCL as given in the table below:

Table 5-60: Approved CAPEX, Capitalization and Funding for the FY 2019-20 and FY
2020-21
(Rs. Crore)
Particulars 2019-20 2020-21
CAPEX 643.35 541.26
Capitalization 643.35 541.26
Less: Consumer contribution 72.65 73.20
Less: Grants 129.95 122.90
Balance Capitalisation 440.75 345.16
Debt @ 70% 308.53 241.61
Equity @ 30% 132.23 103.55

5.12 Fixed Charges

5.12.1 Operations and Maintenance (O&M) Expenses

UGVCL has projected the O&M expenses at Rs. 840.71 Crore for FY 2019-20 and
Rs.942.07 Crore for FY 2020-21 in the Mid-Term Review petition. The O&M expenses
approved for these years in the MYT Order dated 31st March 2017 and the revised
projection submitted by UGVCL are given in the Table below:

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Table 5-61: O&M expenses projected for the FY 2019-20 and FY 2020-21
(Rs. Crore)
2019-20 2020-21
Sr.
Particulars Approved Projected Approved Projected
No.
in MYT in MTR in MYT in MTR)
1 Employee Cost 473.43 734.53 500.51 829.82
2 Repair & Maintenance 98.91 98.91 104.57 104.57
Administration & General
3 84.60 84.60 89.44 89.44
Charges
4 Other Debits 0.00 0.00 0.00 0.00
5 Extraordinary Items 0.00 0.00 0.00 0.00
Net Prior Period Expenses /
6 0.00 0.00 0.00 0.00
(Income)
7 Other Expenses Capitalised (161.75) (77.33) (171.00) (81.76)
Operation & Maintenance
8 495.19 840.71 523.51 942.07
Expenses

Petitioner’s Submission
UGVCL has submitted that the O&M Expenses consist of Employee Cost,
Administration & General Expenses, Repairs and Maintenance Expenses, Other
Debits, Extraordinary Items, and Net Prior Period Income/Expenses.

Regulation 94.8 of GERC MYT Regulations, 2016 states the following methodology for
projection of O&M Expenses:

“Operation and Maintenance expenses:

The Operation and Maintenance expenses shall be derived on the basis of the average
of the actual Operation and Maintenance expenses for the three (3) years ending
March 31, 2015, subject to prudence check by the Commission.
The average of such operation and maintenance expenses shall be considered as
operation and maintenance expenses for the financial year ended March 31, 2014 and
shall be escalated year on year at the escalation factor of 5.72% to arrive at operation
and maintenance expenses for subsequent years up to FY 2020-21.”

The increase in O&M expenses is on two counts (i) inflationary increase and (ii)
increase in the scale of distribution network operation due to increase in network
length, load handling capacity and number of consumers being served, etc. as
compared to base years. The escalation factor of 5.72% per annum takes care of only
the change in O&M expenses on account of inflationary increase. However, it is not
addressing the issue of escalation in O&M expenses due to increased scale of
distribution operations which is beyond the control of the distribution licensee.

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The growth in the Employee expenses at 3-year CAGR for the period from FY 2014-
15 to FY 2017-18 excluding the impact of 7th Pay Commission is shown in the following
Table:

Table 5-62: Consolidated Employee Cost of all DISCOMs

2014-15 2015-16 2016-17 2017-18 3 Year

Rs. Crore CAGR
1531.19 1699.62 1945.96 2175.23 12.42%

UGVCL submitted that considering the above, the actual Employee expenses of FY
2017-18 excluding the impact of 7th Pay Commission is escalated at 12.42% for FY
2019-20 and FY 2020-21. Further, the actual impact of 7th Pay Commission in FY 2017-
18 was there only for the part of the year and that too for only a part of the employees
and is therefore expected to be substantially higher in subsequent years when the
impact is considered for full year for all employees. Considering this, the impact of 7 th
Pay Commission is considered at 20% of salary component for FY 2019-20 and FY
2020-21.

UGVCL submitted that the A&G and R&M expenses for FY 2019-20 and FY 2020-21
are computed as per the GERC (MYT) Regulations, 2016 according to which the
Operation and Maintenance expenses shall be derived on the basis of the average of
the actual Operation and Maintenance expenses for the three (3) years ending 31st
March, 2015. The average of such Operation and Maintenance expenses shall be
considered as Operation and Maintenance expenses for the financial year ended 31st
March, 2014 and shall be escalated year on year at the escalation factor of 5.72% to
arrive at Operation and Maintenance expenses for subsequent years up to FY 2020-
21. Accordingly, the A&G and R&M expenses for FY 2019-20 and FY 2020-21 have
been computed.

The expenses capitalised for FY 2017-18 have been escalated at 5.72% to derive the
expenses capitalised for FY 2019-20 and FY 2020-21.

Other Debits, Extraordinary Items and Net Prior Period Expense/ (Income) are not
considered for projection.

Commission’s Analysis
The Commission examined the O&M expenses incurred by UGVCL during FY 2017-
18 component wise. The GERC (MYT) Regulations, 2016 provides for escalation of
O&M Expenses viz, Employee Cost, Repairs and Maintenance Expenses,
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Administration and General Expenses and Expenses Capitalized @ 5.72% p.a. for FY
2017-18 onwards.

The Commission, accordingly, approves the R&M Expenses, A&G Expenses and
Expenses Capitalised with 5.72% escalation p.a for FY 2019-20 and FY 2020-21 over
the actuals incurred under these heads during FY 2017-18 as trued up in this Order.
The Other Debits are not projected by the Petitioner and therefore, not considered by
the Commission in this Order.

The Commission noted that there is a revision in the Pay Scale of employees of the
Petitioner on account of 7th Pay Commission. It is also noted by the Commission that
only a part of the employees availed the revised salary and that too for a part of the
year during FY 2017-18. On a query from the Commission, the Petitioner vide e-mail
dated 27.02.2019 confirmed that during FY 2017-18, all non-technical employees and
Class III and IV technical employees opted the revised salary and Class I and II
technical employees did not opt the revised salary. It is clarified by the Petitioner that
the revised salary was paid from 1st August, 2017. It is also clarified that no arrears
was paid to the employees during FY 2017-18 on account of revision of salary.

In view of above, the Commission has considered eight months actual paid out amount
due to revision in salary annualised for twelve months plus the pre-revised annual
salary for FY 2017-18 to escalate @ 5.72% Y-o-Y to arrive at employee expenses for
FY 2019-20 and FY 2020-21. The Commission shall consider actual employee
expenses as uncontrollable to the extent of actual payout on account of revision in
salaries and allowances while truing up of FY 2019-20 and FY 2020-21.

Accordingly, the approved O&M expenses are given in the Table below:

Table 5-63: O&M expenses approved in the Mid-Term Review

(Rs. Crore)
Sr. No. Particulars 2019-20 2020-21
1 Employee Cost 608.92 643.75
2 Repairs & Maintenance Expenses 68.58 72.50
3 Administration & General Expenses 110.90 117.24
4 Other Debits 0.00 0.00
5 Extraordinary Items 0.00 0.00
6 Net Prior Period Expenses / (Income) 0.00 0.00
7 Other Expenses Capitalised (77.33) (81.76)
8 Operations & Maintenance Expenses 711.06 751.74

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5.12.2 Depreciation

UGVCL has projected Depreciation at Rs.248.47 Crore for FY 2019-20 and Rs. 273.65
Crore for FY 2020-21 based on the revised capital expenditure projected in the Mid-
Term Review for these years. The depreciation approved for these years in the MYT
order dated 31st March, 2017 and revised projections submitted by UGVCL are given
in the Table below:

Table 5-64: Depreciation projected for the Control Period FY 2019-20 to FY 2020-21

(Rs. Crore)
2019-20 2020-21
Sr.
Particulars Approved Projected Approved Projected
No.
in MYT in MTR in MYT in MTR
1 Gross Block in Beginning of the year 7419.87 5511.90 7965.68 6155.25
2 Additions during the Year (Net) 545.81 643.35 541.26 541.26
3 Depreciation for the Year 399.19 248.47 427.81 273.65
4 Average Rate of Depreciation 5.19% 4.26% 5.19% 4.26%

Petitioner’s Submission
UGVCL has considered the Closing Gross Block of fixed assets of FY 2017-18 as the
Opening Gross Block of fixed assets of FY 2018-19. The addition during 2018-19 to
2020-21 has been projected considering projected capitalisation for the same for each
year. Depreciation has been calculated taking into consideration the Opening Balance
of assets at the beginning of the year and the projected capitalisation. The depreciation
for assets which have completed 12 years from the Transfer Scheme of the State
Government effective from 1st April 2005, has been computed considering the balance
depreciation (difference of GFA as on 1st April, 2017 less accumulated depreciation)
spread equally over the remaining useful life of these assets (23 years considering
useful life of 35 years). This methodology is in line with the GERC (MYT) Regulations,
2016 and the directives of the Commission. The depreciation for the other assets has
also been computed in accordance with the rates specified in the GERC (MYT)
Regulations, 2016.

Commission’s Analysis
The Commission has observed that the Petitioner has computed the depreciation
based on the proviso to Regulation 39(b) of the GERC(MYT), Regulations, 2016.
Accordingly, the Commission has approved the Depreciation as given in the Table
below:

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Table 5-65: Depreciation approved in the Mid-Term Review

(Rs. Crore)
Sr. No. Particulars 2018-19 2019-20 2020-21
1 Gross Block at Beginning of the year 6352.54 6968.65 7612.00
2 Additions during the Year (Net) 616.11 643.35 541.26
3 Closing GFA 6968.65 7612.00 8153.26
4 Avg. GFA 7290.33 7882.63
5 Avg. Rate of Depreciation 3.41% 3.47%
6 Depreciation For the year 248.47 273.65

The Commission approves the Depreciation at Rs. 248.47 Crore for FY 2019-20
and Rs. 273.65 Crore for FY 2020-21 in the Mid-Term Review.

5.12.3 Interest and Finance Charges

UGVCL has projected the interest and finance charges including interest on security
deposit from consumers and guarantee charges at Rs. 189.21 Crore for FY 2019-20
and Rs. 201.94 Crore for FY 2020-21 in the Mid-Term Review petition. The interest
charges approved for these years in the MYT Order dated 31st March, 2017 and the
revised projections submitted in the Mid-Term Review are given in the Table below:

Table 5-66: Interest and Guarantee Charges projected in the Mid-Term Review
(Rs. Crore)
Sr. 2019-20 2020-21
No. Particulars Approved Projected Approved Projected
in MYT in MTR in MYT in MTR
1 Opening Loans 452.67 699.05 293.72 759.11
2 Additions during the Year 240.25 308.53 241.61 241.61
3 Repayments during the Year 399.19 248.47 427.81 273.65
4 Closing Loans 293.72 759.11 107.53 727.07
5 Average Loans 373.19 729.08 200.63 743.09
6 Weighted Average Rate of Interest 0.07 0.11 0.07 0.11
7 Interest on Loan 27.13 76.63 14.59 78.10
8 Interest on Security Deposit 112.93 112.58 124.22 123.84
9 Guarantee Charges 0.83 0.00 0.83 0.00
10 Total Interest & Financial Charges 140.89 189.21 139.64 201.94

Petitioner’s submission
UGVCL has submitted that it has considered the Closing Balance of loans for FY 2017-
18 as the Opening Balance of FY 2018-19. The normative loan addition in FY 2018-19
to FY 2020-21 is computed as per the Capex funding plan. Repayment of loan is
considered equivalent to depreciation and the rate of interest has been taken as the

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weighted average rate of interest on the actual loan portfolio being 10.51%. The
interest on security deposit has been considered at 7.75% prevailing RBI bank rate as
approved by the Commission in the MYT Order dated 31st March, 2017. Security
Deposit is projected based on year on year growth rate of 10% over the actuals for FY
2017-18 for the remaining control period. Other finance charges comprising guarantee
and bank charges are proposed same as actuals of FY 2017-18.

Commission’s Analysis
The Opening Balance of loans for FY 2018-19 is taken as per actual normative Closing
Balance for FY 2017-18. The Commission has approved the capitalisation and funding
of capital expenditure in Table 5-60 above. The Commission has considered the
weighted average rate of interest of 9.96% based on the actual loan portfolio submitted
by UGVCL vide e-mail dated 19.01.2019 for FY 2017-18, as per the GERC (MYT)
Regulations, 2016.
In respect of Interest on Security Deposit, UGVCL has proposed the bank rate of
7.75%. However, the RBI bank rate was 6.25% as on 07.02.2019 and the Commission
has applied this rate on the average balance of security deposit to arrive at the interest
on security deposit. The growth in deposit is considered at 10.00% p.a. as proposed
by UGVCL. The repayment of loan is considered equivalent to depreciation approved
in Table 5-65 above accordance with the GERC (MYT) Regulations, 2016. The
guarantee and other bank charges are considered at the level of actuals for FY 2017-
18. Considering all the above, the Commission has computed the interest and finance
charges in the Mid-Term Review as detailed in the Table below:

Table 5-67: Approved Interest and Finance Charges in the Mid-Term Review
(Rs. Crore)
Sr. No. Particulars 2018-19 2019-20 2020-21
1 Opening Loans 662.63 699.05 759.11
2 Additions during the year 257.22 308.53 241.61
3 Repayments during the year 220.80 248.47 273.65
4 Closing Loans 699.05 759.11 727.07
5 Average Loans 680.84 729.08 743.09
6 Rate of Interest 9.96% 9.96% 9.96%
7 Interest Charges 67.83 72.64 74.03
8 Opening Security Deposit 1257.76 1383.54 1521.89
9 Additions during the year 125.78 138.35 152.19
10 Closing Security Deposit 1383.54 1521.89 1674.08
11 Average Security Deposit 1320.65 1452.72 1597.99
12 Rate of Interest on Security Deposit 6.25% 6.25%
13 Interest on Security Deposit 90.79 99.87
14 Guarantee Charges 0.00 0.00
15 Interest and Finance Charges (7+13+14) 163.43 173.91

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The Commission approves the Interest and Finance charges at Rs. 163.43 Crore
for FY 2019-20 and Rs. 173.91 Crore for FY 2020-21 in the Mid-Term Review.

5.12.4 Interest on Working Capital

UGVCL has not claimed any interest on working capital as detailed in the Table below:

Table 5-68: Interest on Working Capital projected in the Mid-Term Review

(Rs. Crore)
2019-20 2020-21
Sr.
Particulars Approved Projected Approved Projected
No.
in MYT in MTR in MYT in MTR
1 O & M Expenses 41.27 70.06 43.63 78.51
2 Maintenance Spares 74.20 55.12 79.66 61.55
3 Receivables 885.95 1009.12 923.15 1078.50
Less : Amount held as Security
4 1457.18 1452.71 1602.90 1597.98
Deposit from Consumers
5 Total Working Capital (455.77) (318.41) (556.47) (379.42)
Rate of Interest on Working
6 11.70% 10.65% 11.70% 10.65%
Capital
7 Interest on Working Capital - - - -

UGVCL has not claimed Interest on Working Capital as the Security Deposit available
is higher than the allowable normative Working Capital.

Commission’s Analysis
The Commission has examined the computation of Interest on Working Capital
submitted by DGVCL. Based on the approved O & M Expenses, GFA, Total Revenue
and Average Security Deposit the Commission has computed the Working Capital and
Interest on Working Capital, as detailed in the Table below;
Table 5-69: Interest on Working Capital approved in the Mid-Term Review
(Rs. Crore)
2019-20 2020-21
Sr.
Particulars Approved Approved Approved Approved
No.
in MYT in MTR in MYT in MTR
1 O & M Expenses 41.27 59.26 43.63 62.64
2 Maintenance Spares 74.20 69.69 79.66 76.12
3 Receivables 885.95 1005.29 923.15 1078.50
Less : Amount held as Security
4 Deposit 1457.18 1452.72 1602.90 1597.98
from Consumers
5 Total Working Capital (455.77) (318.48) (556.47) (380.72)
Rate of Interest on Working
6 11.70% 10.65% 11.70% 10.65%
Capital
7 Interest on Working Capital - - - -

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5.12.5 Provision for Bad and Doubtful Debts

UGVCL has considered the provision for bad and doubtful debts at Rs. 0.31 Crore for
FY 2019-20 and Rs. 0.31 Crore for FY 2020-21 in the Mid-Term Review petition. The
provision approved for these years in the MYT order dated 31st March 2017, and the
revised provision submitted in the Mid-Term Review are given in the Table below:

Table 5-70: Provision for Bad and Doubtful debts projected for the FY 2019-20 and FY
2020-21
(Rs. Crore)
2019-20 2020-21
Sr.
Particulars Approved Projected Approved Projected
No.
in MYT in MTR in MYT in MTR
1 Provision for Bad Debts 0.70 0.31 0.70 0.31

Petitioner’s Submission
UGVCL has submitted that it has considered the provision for bad & doubtful debts for
the remaining control period FY 2019-20 and FY 2020- as actuals of FY 2017-18.
UGVCL has further submitted that it is a very legitimate expenditure which is
associated with the business risk and is a consumer related expense as UGVCL is in
a distribution business.

Commission’s Analysis
Regulations 94.9 of the GERC (MYT) Regulations, 2016, specifies that the
Commission may allow bad debts written off as a pass through, in the ARR. The
allowable actual bad debts written off were Rs. 0.31 Crore as per audited annual
accounts for FY 2017-18.

The Commission approves the bad and doubtful debts written off at the level of actual
bad debts written off FY 2017-18 for FY 2019-20 and FY 2020-21 in the Mid-Term
Review. However, actual bad debts written off shall be allowed by the Commission
after prudence check at the time of truing up for FY 2019-20 and FY 2020-21.

The approved bad and doubtful debts written off in the Mid-Term Review is given in
the Table below:

Table 5-71: Bad and Doubtful Debts Written-off approved in the Mid-term Review
(Rs. Crore)
Sl. No. Particulars 2019-20 2020-21
1 Bad and Doubtful Debts Written off 0.31 0.31

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5.12.6 Return on Equity

UGVCL has projected the Return on Equity at Rs. 215.36 Crore for FY 2019-20 and
Rs. 231.86 Crore for FY 2020-21 @14% in the Mid-Term Review petition. The Return
on Equity approved for these years in the MYT Order dated 31st March, 2017 and the
revised projection submitted in the Mid-Term Review are given in the Table below:

Table 5-72: Return on Equity projected for the Mid-Term Review

(Rs. Crore)
2019-20 2020-21
Sr.
Particulars Approved Projected Approved Projected
No.
in MYT in MTR in MYT in MTR
1 Opening Equity 1466.47 1472.17 1569.43 1604.40
2 Equity Additions during the Year 102.96 132.23 103.55 103.55
3 Closing Equity 1569.43 1604.40 1672.98 1707.94
4 Average Equity 1517.95 1538.28 1621.21 1656.17
5 Rate of Return on the Equity 14.00% 14.00% 14.00% 14.00%
6 Return on Equity 212.51 215.36 226.97 231.86

Petitioner’s Submission
UGVCL has submitted that Return on Equity has been computed @ 14% on average
Equity based on the Opening Balance of Equity and normative additions during the
year, which has been arrived at by considering 30% of the capitalization net of
consumer contribution and grants as funded from Equity.

Commission’s Analysis
The Commission has computed Return on Equity @14% on the average Equity of
Opening and Closing Balance with additions during the year approved in Table 5-60
above as given in the Table below:

Table 5-73: Approved Return on Equity for the Mid-Term Review

(Rs. Crore)
Sr. No. Particulars 2018-19 2019-20 2020-21
1 Opening Equity 1361.93 1472.17 1604.40
2 Additions during the year 110.24 132.23 103.55
3 Closing Equity 1472.17 1604.40 1707.94
4 Average Equity 1538.28 1656.17
5 Rate of Return on Equity 14% 14%
6 Return on Equity 215.36 231.86

The Commission approves Return on Equity at Rs. 215.36 Crore for FY 2019-20
and Rs. 231.86 Crore for FY 2020-21 in the Mid-Term Review.

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5.12.7 Income Tax

UGVCL has considered Income Tax at Rs. 14.38 Crore for FY 2019-20 and FY 2020-
21 in the Mid-Term Review against Rs. 17.14 Crore for each year approved in the MYT
Order dated 31st March 2017 as detailed in the Table below:

Table 5-74: Income Tax projected in the Mid-Term Review

(Rs. Crore)
2019-20 2020-21
Sr.
Particulars Approved in Projected Approved in Projected
No.
MYT Order in MTR MYT Order in MTR
1 Income Tax 17.14 14.38 17.14 14.38

Petitioner’s Submission
UGVCL has submitted it has considered Income Tax as per the actual Income Tax
paid in FY 2017-18 as per the audited accounts.

Commission’s Analysis
Regulation 41.1 of the GERC (MYT) Regulations, 2016, specifies that the Commission
in the MYT Order shall provisionally approve income tax payable for each year of the
control period, if any, based on the actual income tax paid as per the latest audited
accounts available for the applicant, subject to prudence check. The latest audited
accounts available for UGVCL is for FY 2017-18 and the Income Tax for FY 2017-18
is Rs. 14.38 Crore.

The Commission accordingly approves the Income Tax as per actual Income Tax paid
for FY 2017-18 in the Mid-Term Review for these years as given in the Table below:

Table 5-75: Income Tax approved in the Mid-Term Review

(Rs. Crore)
Sr. No. Particulars 2019-20 2020-21
1 Income Tax 14.38 14.38

5.12.8 Non-Tariff Income

UGVCL has projected the Non-Tariff Income at Rs. 138.68 Crore for. FY 2019-20 and
FY 2020-21 in the Mid-Term Review against Rs. 146.76 Crore approved for these
years in the MYT Order dated 31st March, 2017 as detailed in the Table below:

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and Determination of Tariff for FY 2019-20
Table 5-76: Non-Tariff Income projected in the Mid-Term Review
(Rs. Crore)
2019-20 2020-21
Sr. Approved Approved
Particulars Projected Projected
No. in MYT in MYT
in MTR in MTR
Order Order
1 Non-Tariff Income 146.76 138.68 146.76 138.68

Petitioner’s Submission
UGVCL has submitted that it has considered Non-Tariff Income for the remaining
control period for FY 2019-20 and FY 2020-21 under respective heads (excluding
Delayed Payment Charges as per Regulation 97.2 of the GERC (MYT) Regulations,
2016) same as the actual figures of FY 2017-18.

Commission’s Analysis
The Commission has approved the actual Non-Tariff Income of Rs. 138.68 Crore at
Table 4-52 of this Order in the True up of FY 2017-18 which excludes the Delayed
Payment Charges. Accordingly, the Commission approves Non-Tariff Income in the
Mid-Term Review as given in the Table below:

Table 5-77: Non-Tariff income approved for FY 2019-20 and FY 2020-21

(Rs. Crore)
Sr. No. Particulars 2019-20 2020-21
1 Non-Tariff Income 138.68 138.68

5.13 Aggregate revenue Requirement (ARR)

As discussed in the above paragraphs, the approved revised Annual Revenue
Requirement for FY 2019-20 and FY 2020-21 is summarised as given in the Table
below:

Table 5-78: Aggregate Revenue Requirement for the FY 2019-20 and FY 2020-21
(Rs. Crore)
Approved for Mid-Term Review
Sr. No. Particulars
2019-20 2020-21
1 Cost of Power Purchase 11128.50 11843.65
2 Operations & Maintenance Expenses 711.06 751.74
2.1 Employee Cost 608.92 643.75
2.2 Repairs & Maintenance Expenses 68.58 72.50
2.3 Administration & General Expenses 110.90 117.24
2.4 Other Debits 0.00 0.00
2.5 Extraordinary Items 0.00 0.00
2.6 Net Prior Period Expenses / (Income) 0.00 0.00
2.7 Other Expenses Capitalised (77.33) (81.76)
3 Depreciation 248.47 273.65
4 Interest & Finance Charges 163.43 173.91

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Approved for Mid-Term Review
Sr. No. Particulars
2019-20 2020-21
5 Interest on Working Capital 0.00 0.00
6 Bad Debts Written off 0.31 0.31
7 Sub-Total [1 to 6] 12251.77 13043.26
8 Return on Equity 215.36 231.86
9 Provision for Tax / Tax Paid 14.38 14.38
10 Total Expenditure (7 to 9) 12481.51 13289.50
11 Less: Non-Tariff Income 138.68 138.68
12 Aggregate Revenue Requirement (10 - 11) 12342.83 13150.82

The Commission approves the revised ARR at Rs. 12342.83 Crore for FY 2019-
20 and Rs. 13150.82 Crore for FY 2020-21 in the Mid-Term Review.

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6 ARR and (Gap) for FY 2019-20

6.1 Revenue from existing Tariff

The UGVCL has estimated the category-wise revenue based on existing tariff at Rs.
4461.60 Crore in respect of category-wise sale projected in term of MUs for FY 2019-
20, as detailed in the Table below:

Table 6-1: Sales (MUs) and Revenue (Crs.) from existing tariff projected for FY 2019-20

Sr. No. Particulars Units Amount in Rs. Crore

A LT Consumers
1 RGP 2418.12 861.90
2 GLP 50.79 21.98
3 Non-RGP & LTMD 2024.59 1118.68
4 Public Water Works 816.42 295.87
5 Agriculture-Metered 3118.88 278.44
6 Agriculture-Unmetered 6312.65 889.25
7 Street Light 56.19 22.98
LT Total (A) 14797.64 3489.10
B HT Consumers
1 Industrial HT 8169.94 4151.68
2 Railway Traction 0.00 0.00
HT Total (B) 8169.94 4151.68
Grand Total (A + B) 22967.58 7640.78

Petitioner’s submission
UGVCL submitted that it has considered sale of 22967.58 MUs to different categories
of consumers as per MTR petition as shown in the Table above and the existing retail
tariff to work out the revenue from sale of power at Rs. 7640.78 Crore for FY 2019-20.

Commission’s Analysis

The Commission observed UGVCL has considered the category-wise sales for FY
2019-20, as approved in Table 5.19 of this Order. Taking into consideration the same
and the exiting tariff for each category, the Commission has computed the revenue
from sale of power for FY 2019-20 as detailed in the Table below:

Table 6-2: Approved Sales (MUs) and Revenue from existing tariff for FY 2019-20
Sr. No. Particulars Units Amount in Rs. Crore
A LT Consumers
1 RGP 2418.12 861.90
2 GLP 50.79 21.98
3 Non-RGP & LTMD 2024.59 1118.68
4 Public Water Works 816.42 295.87

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Sr. No. Particulars Units Amount in Rs. Crore
5 Agriculture-Metered 3118.88 278.44
6 Agriculture-Unmetered 6312.65 889.25
7 Street Light 56.19 22.98
LT Total (A) 14797.64 3489.10
B HT Consumers
1 Industrial HT 8169.94 4151.68
2 Railway Traction 0.00 0.00
HT Total (B) 8169.94 4151.68
Grand Total (A + B) 22967.58 7640.78

6.2 Revenue from FPPPA charges

UGVCL has estimated revenue from FPPPA charges for FY 2019-20, as detailed in
the Table below:

Table 6-3: Projected Revenue from FPPPA Charges for the FY 2018-19
(Rs. Crore)
Particulars Amount
Rate of FPPPA (Rs./.kWh) 1.63
Sales (MUs) 22967.58
FPPPA charges in Rs. Crore 3743.72

Petitioner’s submission
UGVCL has submitted that In the True up Order for FY 2016-17 dated 31st March,
2018, the Commission has considered the base power purchase cost at Rs. 4.22/unit
and base FPPPA at Rs. 1.49/unit. As per the approved FPPPA formula, any increase
in power purchase cost during the year over and above base power purchase cost of
Rs. 4.22/unit is to be recovered through FPPPA over and above base FPPPA of Rs.
1.49/unit on quarterly basis. As per projected ARR for FY 2019-20, the weighted
average power purchase cost is worked out to Rs. 4.34/unit as against base power
purchase cost of Rs. 4.22/unit. Thus, the incremental power purchase cost of Rs.
0.12/unit for FY 2019-20 (i.e. Rs. 4.34 - 4.22)will be recovered through FPPPA over
and above base FPPPA of Rs. 1.49/unit. Therefore, estimated revenue from FPPPA
for FY 2019-20 is considered at Rs. 1.63/unit for FY 2019-20 (i.e. grossing up by
approved losses), as shown below:

Table 6-4 FPPPA Charges for the FY 2019-20

(Rs. Crore)
Sr. No. Particulars 2018-19 2019-20
1 Fixed Cost 13520 11900
2 Variable Cost 19523 24734
3 GETCO Cost 3749 4115
4 GUVNL Cost 368 399
5 PGCIL Charge 1670 2077

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Sr. No. Particulars 2018-19 2019-20
6 SLDC Charge 8 16
7 Total Power Purchase Cost 38838 43240
8 Total Energy Requirements 91973 99680
9 Power purchase Cost (Rs. /kWh) 4.22 4.34
10 Increase in Power Purchase Cost 0.12
Additional FPPPA Charges (Grossed up by
11 0.14
Loss)
12 Existing FPPPA Charges (Rs./kWh) 1.49
13 Revised FPPPA Charges (Rs./kWh) 1.63

Commission’s Analysis
The Commission allows FPPPA charges FY 2019-20 at 1.61 Rs. per kWh considering
the Fixed Cost and variable Cost as approved at Table 5.46 and 5.47 of this Order as
shown in Table below:

Table 6-5: FPPPA Charges for the FY 2019-20

Sr. As per MYT Order Projected in Approved in

Particulars
No. for 2018-19 MTR MTR
1 Fixed Cost in Rs. Crore 13520 11900 11900
2 Variable Cost in Rs. Crore 19523 24734 24572
3 GETCO Cost in Rs. Crore 3749 4115 4115
4 GUVNL Cost in Rs. Crore 368 399 399
5 PGCIL Charge in Rs. Crore 1670 2077 2077
6 SLDC Charge in Rs. Crore 8 16 29
Total Power Purchase
7 38838 43240 43092
Cost in Rs. Crore
Total Energy
8 91973 99680 99680
Requirements in MUs
Power purchase Cost
9 4.22 4.34 4.32
(Rs./kWh)
Increase in Power
10 Purchase Cost in 0.12 0.10
Paise/Unit
Additional FPPPA Charges
11 (Grossed up by Loss 0.14 0.12
@17.36%) in Paise/Unit
Existing FPPPA Charges
12 1.49 1.49
(Rs./kWh)
Revised FPPPA Charges
13 1.63 1.61
(Rs./kWh)

Accordingly, the Commission allows FPPPA charges and revenue therefrom on the approved
sales of 22967.58 MUs for FY 2019-20 at 1.61 Rs./kWh as shown in the Table below:

Table 6-6: Approved Revenue from FPPPA Charges for the FY 2019-20
(Rs.Crore)
Particulars Amount
Rate of FPPPA considered (Rs./.kWh) 1.61
Sales (MUs) 22967.58
Base FPPPA Charges (Rs. Crore) 3697.78

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6.3 Other consumer related income

UGVCL has estimated the other consumer related income at Rs. 203.30 Crore for FY
2018-19, as detailed in the Table below:
Table 6-7: Other Consumer related Income for FY 2019-20
(Rs. Crore)
Particulars 2019-20
Other Income Consumer Related 203.30

Petitioner’s submission

UGVCL has submitted that the revenue from other consumer related income
comprises of revenue on account of charges other than the basic charges applicable
to the Consumers. These include income on account of meter rent, wheeling charges,
inspection charges and miscellaneous charges.
Commission’s Analysis
The Commission has observed that UGVCL has projected the other consumer related
income for FY 2019-20 as actuals of FY 2017-18 excluding the meter rent.

The Commission, accordingly, approves the other consumer related income at Rs.
203.30 Crore for FY 2019-20.
Table 6-8: Approved other consumer related Income for FY 2019-20
(Rs. Crore)
Particulars 2019-20
Other Income Consumer Related 203.30

6.4 Agriculture Subsidy

Petitioner’s submission

UGVCL submitted that the annual Agricultural Subsidy that was being received by the
erstwhile GEB from the State Government will continue to be received by the four
DISCOMs i.e. Rs 1100 Crores. The share of Agricultural Subsidy for FY 2019-20 is
considered on pro-rata basis of agriculture consumption.

Table 6-9: Projected Agriculture Subsidy for FY 2019-20

(Rs. Crore)
Particulars 2018-19
Share of Agriculture Subsidy 521.64

Commission’s Analysis
The Commission considered the Agriculture Subsidy as claimed by the Petitioner.

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Table 6-10: Approved Agriculture Subsidy for FY 2019-20

(Rs. Crore)
Particulars 2018-19
Share of Agriculture Subsidy 521.64

The Commission considered the the Agriculture subsidy claimed by the Petitioner
The Commission, accordingly, approves Agricultural Subsidy as Rs.521.64
Crore for FY 2019-20.

6.5 Total Expected Revenue for FY 2019-20

Petitioner’s submission

The total expected revenue for UGVCL comprises of revenue from sale of power at
existing tariff, FPPPA charges, other consumer related income and Agriculture
Subsidy. Total revenue for FY 2019-20 is shown in the Table below:
Table 6-11: Projected Revenue for FY 2019-20
(Rs. Crore)
Sr. No. Particulars Amount
1 Revenue with Existing Tariff 7640.78
2 Base FPPPA Charges @ 163 paisa/kWh 3743.72
3 Other Income (Consumer related) 203.3
4 Agriculture Subsidy 521.64
5 Total Revenue including subsidy (1 to 4) 12109.44

Commission’s Analysis
The total revenue as estimated by the Commission for FY 2019-20 is shown in the
Table below:

Table 6-12: Approved Total Revenue for FY 2019-20

(Rs. Crore)
Sr. No. Particulars Amount
1 Revenue with Existing Tariff 7640.78
2 Base FPPPA Charges @ 161 paisa/kWh 3697.78
3 Other Income (Consumer related) 203.3
4 Agriculture Subsidy 521.64
5 Total Revenue including subsidy (1 to 4) 12063.51

6.6 ARR for FY 2019-20

The Table below shows approved Aggregate Revenue Requirement including power
purchase cost of UGVCL for the FY 2019-20.

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Table 6-13: Approved Mid-Term Review ARR for FY 2019-20
(Rs. Crore)
Sr. No. Particulars Amount
2019-20
1 Cost of Power Purchase 11128.50
2 Operations & Maintenance Expenses 711.06
2.1 Employee Expenses 608.92
2.2 Repairs & Maintenance 68.58
2.3 Administration & General Expenses 110.90
2.4 Other Debits 0.00
2.5 Extraordinary Items 0.00
2.6 Net Prior Period Expenses / (Income) 0.00
2.7 Other Expenses Capitalised (77.33)
3 Depreciation 248.47
4 Interest & Guarantee Charges 163.43
5 Interest on Working Capital 0.00
6 Provision for Bad Debts 0.31
7 Sub-Total [1 to 6] 12251.77
8 Return on Equity 215.36
9 Provision for Tax / Tax Paid 14.38
10 Total Expenditure (7 to 9) 12481.51
11 Less: Non-Tariff Income 138.68
12 Aggregate Revenue Requirement (10 - 11) 12342.83

6.7 Estimated Revenue (Gap)/Surplus for FY 2019-20 for

UGVCL
Based on the above, the estimated revenue (Gap) for FY 2019-20 at the existing tariff
is worked out as outlined in the Table below:

Table 6-14: Estimated Revenue (Gap)/Surplus for FY 2019-20 at Existing Tariff for
UGVCL
(Rs. Crore)
Approved by
Sr. Projected
Particulars the
No. by UGVCL
Commission
1 Aggregate revenue requirement 12526.72 12342.83
2 Revenue (Gap)/ Surplus from True up of FY 2017-18 (34.52) (43.20)
3 Total aggregate revenue requirement (1-2) 12,561.25 12386.03
4 Revenue with existing tariff 7640.78 7640.78
5 PPPA charges @ 161 paisa/kWh 3743.72 3697.78
6 Other income (Consumer related) 203.30 203.30
7 Agriculture Subsidy 521.64 521.64
8 Total revenue including subsidy (4+5+6+7) 12109.44 12063.51
9 (Gap)/Surplus (8-3) (451.81) (322.53)

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6.8 Consolidated Revenue (Gap)/Surplus of the State Owned

DISCOMs
Since the uniform tariff for State owned DISCOMs has been envisaged in the MYT
Order dated 6th September, 2011 as well as MYT Order dated 31st March, 2017, it is
necessary to consider the consolidated (Gap)/Surplus of FY 2019-20 for all the State-
owned DISCOMs, while determining the tariff for FY 2019-20. The consolidated
(Gap)/Surplus computed for FY 2019-20 is shown in the Table below:
Table 6-15: Consolidated (Gap)/Surplus computed for FY 2019-20
(Rs. Crore)
Particulars DGVCL MGVCL PGVCL UGVCL Total
Trued Up (Gap)/ Surplus of
409.64 116.83 (295.40) (43.20) 187.87
FY 2017-18
Total (Gap)/ Surplus for FY
2019-20 including (Gap)/ 175.01 (13.46) (688.19) (322.53) (849.17)
Surplus of Trued Up Year

UGVCL has stated that there is a pending Ag. Subsidy of Rs. 1665 Crore against
subsidy for FY 2017-18 from Government of Gujarat. As per Section 65 of the
Electricity Act, 2003, the subsidy was required to be released in advance. GUVNL has
requested Government of Gujarat for release of outstanding subsidy amount.
Accordingly, after consideration of the amount of outstanding subsidy, the resultant
Surplus works out to Rs. 815.83 Crore (1665-849.17) for FY 2019-20.

It is observed that there is a Surplus of Rs. 187.87 Crore against the true up of FY
2017-18, which is due to disallowance of Rs. 440.40 Crore claim of DGVCL on account
of non-recovery of dues pending before various adjudicating authorities on the amount
receivable from M/s Essar Steel India Limited. Therefore, this Surplus is not allowed
to be passed through at this stage.
Further, the remaining surplus is on account of Mid-Term Review sought by the
Petitioners and approval of the Commission based on the various parameters and
Regulations of the third MYT period. The Commission feels that it may not be
reasonable that such surplus to be passed through in the tariff as in response of
representations of certain category of consumers, the Commission has made some
changes in slab rate, optional tariff and reduction in Lift Irrigation tariff. Similarly, there
are certain changes likely in the energy sales of high value consumers due to Open
Access, uncertainty in power market, impact of revision in employee cost of DISCOMs
on account of 7th Pay Commission etc. Hence, the Commission may consider such
variations in the ARR of respective year true up.

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7 Compliance of directives

7.1 Compliance to earlier directives

The Commission had given various directives to UGVCL in the Order dated 31st March
2017, compliance of which is mentioned below:

Directive 1: Meters on Distribution Transformers

UGVCL should install meters on balance transformers by 31.12.2016 and submit a
report to the Commission. The DISCOM should submit the results of energy audit
conducted along with counter measures taken into account by 31.12.2016.

Compliance:
UGVCL has submitted the progress report on providing Meters on Distribution
Transformers as on September, 2018 as under:
Distribution Transformer Metering SEPT.18
DTR with Single
Metered No. of
No. of No. of
Consumer DTs % DT
Discom Category Distribution DTs Pending
which is metered Metered
Transformer metered
considered as physically
DTR with Meter
UGVCL Industrial 7235 2333 4902 7235 100.00 0
GIDC 1490 363 1127 1490 100.00 0
Urban 13792 640 13152 13792 100.00 0
JGY 29744 3129 26615 29744 100.00 0
AG. DOM 225403 142608 82795 225403 100.00 0
Total 277664 149073 128591 277664 100.00 0

Commission’s comments:

UGVCL has completed 100% work of installation of energy meters on Distribution

Transformer. They are directed to initiate energy audit of Distribution Transformer of
each category of feeders having higher distribution losses and report the action taken
on such energy audit report.

Directive 2: Losses on Jyoti Gram Yojana feeders

DISCOMs are directed to identify the feeders with more than 50 % loss level and 5%
loss reduction should be targeted for such feeders.
Compliance:

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UGVCL has submitted the status of Distribution losses of JGY Feeders as under:

Sr. Unit sent Unit sold

Year % Loss
No. out [MUs] out [MUs]
1 2012-13 2362.185 1837.117 22.23
2 2013-14 2529.814 1974.876 21.94
3 2014-15 2766.467 2182.678 21.10
4 2015-16 2955.158 2346.743 20.59
5 2016-17 3139.246 2511.423 20.00
6 2017-18 3398.128 2753.756 18.96

The Status of Distribution losses of 54 Nos of JGY Feeders are as follows:

Sr. Unit sent Unit sold

Year % Loss
No. out [MUs] out [MUs]
1 2016-17 278.575 92.435 66.82
2 2017-18 281.813 98.955 64.89
3 2017-18(Aug-17) 125.927 42.023 66.64
4 2018-19(Aug-18) 131.948 45.856 65.25

UGVCL has submitted that in JGY category overall % distribution losses are reduced
from 22.23% (2012-13) to 18.96% (2017-18) i.e reduced by 3.27% in last five years.
Also in 54 Nos of JGY High losses feeders having more than 50% distribution losses
is in reducing trends as per above table and out of 54 Nos of feeders up to Aug-18, 22
Nos of JGY feeders losses are reducing trends compared to target and 33 Nos of JGY
feeders losses are in reducing trend compared to previous year same period.
Company has made full efforts for reducing distribution losses on JGY feeders.

Commission’s comments:

Compliance submitted by the Petitioner is noted. The Petitioner is directed to continue

the efforts for reduction in the losses of the selected JGY feeders and submit quarterly
report about actions taken in this regard to the Commission

Directive 3: Energy Audit and Segregation of HT & LT losses

The Commission has directed UGVCL to submit a report about actions taken to reduce
technical and commercial losses on HT system and LT system including different
feeders, transformers (DTC) on monthly basis to the Commission so as to monitor the
losses

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Compliance: .
UGVCL submitted that the Cmpany has carried out activities like replacement of stop
meters, provided Static meters in place of slow and sluggish old electromechanical
meters, provided SMC, provided Aerial Bunch Conductor in place of open bare
conductors, increase in HT/LT ratio, adoption of high voltage distribution system
(HVDS), preventive and regular maintenance, Load Balancing, publicity campaign on
theft of electricity as a social and economic crime and people informed of the provisions
in electricity laws, public relation and awareness campaigns by utility, etc. As per BIS
guideline, from FY: 2018-19 our utility is implemented to install star rated distribution
transformer so that level 2 in agriculture feeders. Also by constant monitoring from
higher authority and respective officers on all the high losses feeders allocated, the
micro plan has already been implemented for further reduction of losses on feeders.

In this context, following specific activities has been carried out on feeders by the
Company:

General Activity Carried Out:

Particulars Unit Apr-18 May-18 June-18 July-18 Aug-18 Sep-18 Oct-18

Maintenance HT line Km 7916.5 9468.2 9365.7 7790.9 7442.7 7817.6 8675.3
Maintenance LT line Km 4134.8 4423.8 4535.9 4067.0 3753.6 3159.2 3971.1
Maintenance of T’mer Nos 6684 7892 9518 8679 8753 7979 8714
Feeder bifurcation Nos 18 15 19 34 25 31 38
Arial Bunch Conductor Km 4.36 0.83 67.5 273.5 216.5 182.6 267.1
XLPE Cable Km 11.41 22.33 14.28 22.76 13.89 22.08 15.67
Meter Replacement 1-Ph No. 12433 14781 12835 15887 17082 11602 32668
Meter Replacement 3-Ph No. 2326 1846 1802 2733 2202 1581 3410
Renovation of Conductor Km 10 25 91 125 194 277.3 302
Installation of 1-Ph SMC No. 7392 7763 9188 9143 6559 7463 11039
Installation of 3-Ph SMC No. 1639 2740 2871 2911 1812 2469 3335
Sealing 1-Ph No. 17162 23663 26734 26574 23634 19354 23098
Sealing 3-Ph No. 4510 7028 6902 6307 4595 4835 6347
Nos of conn. Checked No. 42094 51152 49366 44321 44147 48432 39783
Nos of conn. Detected No. 1335 1488 1547 657 935 1165 1326
Theft Assessment Lacs. 268.72 459.95 287.21 211.72 275.25 194.46 241.47

Commission’s comments:

The Commission noted the compliance submitted by the Petitioner.

Directive 4: Replacement of Defective Meters

The Commission directed to ensure correct functioning of the meters so that the energy
consumption is reflected correctly and accordingly correct revenue is earned from the
consumers against cost of supply.

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Compliance:
UGVCL has submitted that the faulty or improperly functioning meters are replaced
regularly based on the monthly generated reports. This is a continuous process as new
faulty meters are added during the month and the replacement of the same is also
being carried out during the month.

The status of faulty meters quarter wise is as under:

Faulty meters pending to be replaced at the end

Sr.
Reporting Quarter period of reporting quarter
No.
1 phase 3 phase Total
1 June-18 4633 3101 7734
2 Sept-18 4638 2311 6949
3 Oct-18 3890 2448 6338

Commission’s comments:

The Commission noted the compliance submitted by the Petitioner and directed to
continue efforts to replace the defective energy meters as planned. Utilities may also
conduct a study to understand the nature of fault and take up the issue with the
manufacturers of such meters for mitigation.

Directive 5: Optimization of Power purchase Cost with varying demand at

competitive rate.
The Commission has directed to plan out power purchase in advance on priority to
optimise power purchase cost with the varying demand at competitive rate so as to
maintain consistent and reliable supply in the State.

Compliance:
GUVNL has tied up adequate capacity on long term basis which can successfully meet
the entire power demand including peak demand. However, availability of power from
imported coal based projects has been highly varying during last 2 years specifically
after Hon’ble Supreme Court’s Order dated 11.4.2017.

As per the directive of the Commission and in order to ensure procurement of power
at competitive rates and to optimize overall power purchase cost, GUVNL in
consultation with SLDC, had invited bids well in advance in Jan-18 and tied up around
300 MW power for the period of March 2018 to May 2018 and also tied up 200-1025
MW for the period of September 2018 to December 2018 by inviting tender in July-18

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through competitive bidding followed by reverse auction through DEEP Portal in

accordance with Ministry of Power’s Guidelines for Short term procurement of power.

In addition, GUVNL had invited bid for tie up of 500 MW power under Flexible Coal
Utilization Scheme of Ministry of Power wherein supply is already commenced from
Jan-18 which has enabled savings in coal transportation cost and ensured supply at
competitive rates. GUVNL has also invited second bid for tie-up of 1000 MW power
under flexible coal utilization scheme.

Further, considering the future requirement of power, GUVNL is contemplating to invite

bids for capacity tie-up on long term basis for meeting the future power requirement
without relying on short term arrangement.

Commission’s comments:
The Commission noted the compliance of the Petitioner. It is further directed to sale
Surplus power in the market looking to the availability of significant amount of cheaper
RE power in the State by optimizing grid operations in consultation with SLDC/GUVNL
so as end consumer gets benefited.

Directive 6: Detailed study to work out cost of supply at EHV level

In order to promote supply at higher voltages the DISCOMs are directed to carry out a
detailed study to work out cost of supply at EHV level, reduction in technical loss for
supplying electricity at higher voltages, and submit it to the Commission on or before
30th September, 2018.

Compliance:
On behalf of 4 DISCOMs, GUVNL has engaged a consultant to carry out a detailed
study as per above directive of the Commission. The study work is under progress and
the study report shall be submitted to the Commission in due course upon successful
completion of study.

Commission’s comments:

DISCOMs are directed to ensure timely completion of the study and submit the report
by 30th June, 2019.

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Directive 7: Scheme for Installation of solar pump for agriculture

consumers
In order to promote renewable energy, the Commission has directed to explore the
possibilities for promotion of installation of solar pump for agriculture consumers
thereby promoting de-centralised energy generation.

Compliance:
In order to achieve multiple objectives of addressing the energy requirement of farmers
and to promote de-centralized renewable energy generation, the State Government
decided to utilize solar resources available in the State for the benefits of the farmers
and accordingly notified the Scheme namely Suryashakti Kisan Yojna (SKY) to be
implemented on pilot basis.

Major objectives of the scheme are:

 To provide adequate and reliable day time power to farmers by installation of

solar PV panels.
 To incentivize farmers by selling Surplus solar power to DISCOM and to provide
secondary source of income to farmers thereby encouraging farmers to
efficiently utilization of power and water.
 To help farmers to become self reliant for their power requirement.
 To Create employment opportunities in rural area.
 To reduce financial burden of DISCOMs and Government by reducing the
subsidized power to farmers.

 To promote source of renewable energy and meet solar renewable purchase

obligation of DISCOMs.
As per the directive of the Commission, the scheme has been implemented on Pilot
basis in the areas of all four DISCOMs.
Commission’s comments:

Commission noted compliance of the Petitioner and directed to submit the outcome of
pilot project.

Directive 8: Iinitiate study for implementing Demand Response Measures

The Commission has directed DISCOM to initiate study for implementing Demand
Response Measures and submit its action plan by 30th Sept 2018.

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Compliance:
On behalf of 4 DISCOMs, GUVNL has engaged a consultant to carry out a detailed
study as per above directive of the Commission. The study work is under progress and
the study report shall be submitted to the Commission in due course upon successful
completion of study.

Commission’s comments:

DISCOMs are directed to ensure timely completion of the study and submit the report
by 30th June, 2019

7.2 Fresh directives

Directive 1:

Petitioner is directed to report the outcome of HVDS implementation along with the
petition of next Tariff Order.

Directive 2:

Petitioner is directed to keep the FPPPA information available on their website for all
the quarters of a year till the truing up exercise of that particular year is completed.

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8 Fuel and Power Purchase Price Adjustment

8.1. Fuel Price and Power Purchase Price Adjustment

The Commission its Order in Case No. 1309/2013 and 1313/2013 vide dated
29.10.2013, has approved the formula as mentioned below:

FPPPA = [(PPCA-PPCB)] / [100-Loss in %]; Where,

is the average power purchase cost per unit of delivered energy (including
transmission cost), computed based on the operational parameters
approved by the Commission or principles laid down in the Power Purchase
Agreements in Rs./kWh for all the generation sources as approved by the

PPCA Commission while determining ARR and who have supplied power in the
given quarter and transmission charges as approved by the Commission for
transmission network calculated as total power purchase cost billed in Rs.
Million divided by the total quantum of power purchase in Million Units made
during the quarter.
is the approved average base power purchase cost per unit of delivered
energy (including transmission cost) for all the generating stations
considered by the Commission for supplying power to the company in
PPCB Rs./kWh and transmission charges as approved by the Commission
calculated as the total power purchase cost approved by the Commission in
Rs. Million divided by the total quantum of power purchase in Million Units
considered by the Commission.
is the weighted average of the approved level of Transmission and
Distribution losses (%) for the four DISCOMs / GUVNL and TPL applicable
for a particular quarter or actual weighted average in Transmission and
Loss in %
Distribution losses (%) for four DISCOMs / GUVNL and TPL of the previous
year for which true-up have been done by the Commission, whichever is
lower.

8.2. Base Price of Power Purchase (PPCB)

The Commission has approved the total energy requirement and the total Power
Purchase Cost for all the DISCOMs including fixed cost, variable cost, GETCO cost,
PGCIL charges, SLDC charges for FY 2019-20 from various sources as given in the
Table below:

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Table 8-1: Base price of power purchase

Sr.No. Particulars FY 2019-20

1 Fixed Cost 11900
2 Variable Cost 24572
3 GETCO Cost 4115
4 GUVNL Cost 399
5 PGCIL Charge 2077
6 SLDC Charge 29
7 Total Power Purchase Cost 43092
8 Total Energy Requirement 99680
9 Power Purchase Cost (Rs./ kWh) 4.32

As mentioned above the base Power Purchase cost for the DISCOMs is Rs. 4.32/kWh.

GUVNL/DISCOMs may claim difference between actual power purchase cost and
base power purchase cost approved in the Table above as per the approved FPPPA
formula mentioned above.

Information regarding FPPPA recovery and the FPPPA calculations shall be kept on
the website of the Licensee / GUVNL.

For any increase in FPPPA, worked out on the basis of above formula, beyond ten (10)
paise per kWh in a quarter, prior approval of the Commission shall be necessary and
only on approval of such additional increase by the Commission, the FPPPA can be
billed to consumers.

FPPPA calculations shall be submitted to the Commission within one month from the
end of the relevant quarter.

8.3. Shifting of Base FPPPA

DISCOMs have submitted that in the True up Order dated 31st March, 2018, the
Commission have considered the base power purchase cost at Rs. 4.22/unit and base
FPPPA at Rs. 1.49/unit. As per approved FPPPA formula, any increase in power
purchase cost of Rs. 4.22/unit is to be recovered through FPPPA over and above base
FPPPA of Rs. 1.49/unit on quarterly basis. As per projected ARR for FY 2019-20, the
weighted average power purchase cost worked out to Rs. 4.34/unit. Thus, the
incremental power purchase cost of Rs. 0.12/unit for FY 2019-20 (i.e. 4.34-4.22) to be
recovered, after grossing up by approved loss, through FPPPA over and above base
FPPPA of Rs. 1.49/unit. Accordingly, Discoms have proposed to shift base FPPPA
from Rs. 1.49/unit to Rs. 1.63/unit.

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The Commission has approved base power purchase cost for FY 2019-20 as Rs.
4.32/unit as stated above. Thus, there is an increase of Rs. 0.10/unit in the base
power purchase cost of DISCOMs for FY 2019-20 over that of for FY 2018-19. The
Commission finds it appropriate to increase the base FPPPA by Rs. 0.12/unit
after grossing up the incremental base power purchase cost of Rs. 0.10/unit with
the approved loss. Accordingly, the base FPPPA for FY 2019-20 is approved as
Rs. 1.61/unit (1.49+0.12).

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9 Wheeling charges and cross subsidy surcharge

9.1. Allocation matrix

Regulations 87 of the GERC (MYT) Regulations, 2016 stipulates that the Commission
shall specify the wheeling charges of distribution wires business of the distribution
licensees in the ARR and Tariff Order.

UGVCL has provided the allocation matrix for allocation of costs between wires
business and retail supply business as notified in the GERC (MYT) Regulations, 2016
(Regulation 87) as shown in the table below:

Table 9-1: Allocation matrix for segregation of wheeling and retail supply for UGVCL
for the FY 2019-20
Sr. Retail Supply
Allocation Matrix Wire Business
No. Business
1 Power Purchase Expenses 0% 100%
2.1 Employee Expenses 60% 40%
2.2 Repairs & Maintenance Expenses 90% 10%
2.3 Administration & General Expenses 50% 50%
2.4 Other Debits 50% 50%
2.5 Extraordinary Items 50% 50%
2.6 Net Prior Period Expenses / (Income) 25% 75%
2.7 Other Expenses Capitalized 55% 45%
3 Depreciation 90% 10%
4 Interest & Finance charges 90% 10%
5 Interest on Working Capital & Security Deposit 10% 90%
6 Bad Debts Written off 0% 100%
7 Income Tax 90% 10%
8 Return on Equity 90% 10%
9 Non-tariff income 10% 90%

Based on the above allocation the approved ARR for wires business and retail supply
business for FY 2019-20 are computed as shown in the table below:.

Table 9-2: Allocation of ARR between wheeling and retail supply business for UGVCL
for FY 2018-19
(Rs. Crore)
Sr. Wire Retail Supply
Particulars Distribution
No. Business Business
1 Power Purchase Expenses 11128.50 - 11128.50
2 O & M Expenses 711.06 439.99 271.07
2.1 Employee Expenses 608.92 365.35 243.57
2.2 Repairs & Maintenance Expenses 68.58 61.72 6.86
2.3 Administration & General Expenses 110.90 55.45 55.45
2.4 Other Debits - - -
2.5 Extraordinary Items - - -
2.6 Net Prior Period Expenses /(Income) - - -

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Sr. Wire Retail Supply
Particulars Distribution
No. Business Business
2.7 Other Expenses Capitalized (77.33) (42.53) (34.80)
3 Depreciation 248.47 223.62 24.85
4 Interest & Finance Charges 72.64 65.38
7.26
5 Interest on Security Deposit 90.79 9.08 81.72
6 Interest on Working Capital - - -
7 Bad Debts Written Off 0.31 - 0.31
Contribution to Contingency
8 - - -
Reserves
9 Total Revenue Expenditure 12251.77 738.06 11513.71
10 Return on Equity Capital 215.36 193.82 21.54
11 Income Tax 14.38 12.94 1.44
12 Aggregate Revenue Requirement 12481.51 944.83 11536.68
14 Less: Non-Tariff Income 138.68 13.87 124.81
15 Aggregate Revenue Requirement 12342.83 930.96 11411.87

9.2. Wheeling charges

The Wheeling Charges for the four Distribution Companies, DGVCL, MGVCL, PGVCL
and UGVCL for the FY 2019-20, as given below are applicable for use of the
distribution system of a licensee by other licenses or generating companies or captive
power plants or consumers / users who are permitted open access under Section 42
(2) of the Electricity Act, 2003.
Table 9-3: Wheeling Charges for FY 2019-20

Sr. No. Particulars Units FY 2019-20

1 Distribution costs of the four DISCOMs Rs. Crore 4659.44
Distribution cost of the four DISCOMs at 11 kV
2 Rs. Crore 1397.83
level (30% of total distribution cost)
Distribution cost of the four DISCOMs at LT level
3 Rs. Crore 3261.61
(70% of total distribution cost)
4 Energy input at 11 kV MUs 94414
5 Wheeling Charges at 11 kV Ps./kWh 14.81
6 Energy Input at 400 V MUs 51334
7 Wheeling Charges at 400 V (LT) Ps./kWh 63.54

Accordingly, the Commission approves wheeling charges for HT network (11 KV

system) at 14.81 Paise per unit and wheeling charges for LT network (400 V
system) at 63.54 Paise per unit.
Distribution Loss
The distribution loss at 11 kV and 400 V during FY 2019-20 are given below:
Point of energy delivered
Particulars
11 kV 400 Volts
11 kV, 22 kV and 33 kV 10% 12.75%
400 Volts 5.05%

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The losses in HT and LT network are 10% and 5.05% respectively, with respect to
energy input to the segment of the system. In case injection at 11 kV levels and drawal
at LT level envisages use of both the networks i.e. 11 kV and LT, in that case, the
combined loss works out to 12.75% of the energy injection at 11 kV network.

The above wheeling charges payable shall be uniform in all the four distribution
companies, DGVCL, MGVCL, PGVCL and UGVCL.

9.3. Cross Subsidy Surcharges

The cross subsidy surcharge is based on the formula given in the Tariff Policy as
below:
S = T-[C/ (1-L/100) +D +R]

Where,

 T is the tariff payable by the relevant category of consumers, including reflecting

the Renewable Purchase Obligation
 C is the per unit weighted average cost of power purchase by the Licensee,
including meeting the Renewable Purchase Obligation
 D is the aggregate of transmission, distribution and wheeling charge applicable
to the relevant voltage level
 L is the aggregate of transmission, distribution and commercial losses,
expressed as a percentage applicable to the relevant voltage level
 R is the per unit cost of carrying regulatory assets.

The cross subsidy surcharge based on the above formula is worked out as shown in
the Table below:

Table 9-4: Cross subsidy surcharge for FY 2019-20

Sr. No. Particulars Units HT Industry

1 T Rs./ kWh 6.82
2 C Rs./ kWh 4.32
3 D Paise/ kWh 14.81
4 L % 10%
5 S (Cross Subsidy Surcharge) Rs./ kWh 1.87

S= 6.82 – [4.32/(1-0.10) + (14.81/100) + 0]= 1.87

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Thus, Cross Subsidy Surcharge as per Tariff Policy, 2016 works out to Rs. 1.87 /kWh
for the four State owned Distribution companies viz. DGVCL, MGVCL, PGVCL and
UGVCL.
However, Tariff Policy, 2016 provides that the surcharge shall not exceed 20% of the
tariff applicable to the category of the consumers seeking Open Access.
In view of above, the Commission decided to restrict the Cross Subsidy Surcharge
leviable from the consumers of the four State Owned Distribution Companies, seeking
Open Access, for FY 2019-20 at Rs. 1.36 /kWh.

Accordingly, Cross Subsidy Surcharge for HT Category = 1.36 Rs. /kWh for FY 2019-
20.

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10 Tariff Philosophy and Tariff Proposals

10.1. Introduction
The Commission is guided by the provisions of the Electricity Act, 2003, the National
Electricity Policy (NEP), the Tariff Policy, the Regulations on Terms and Conditions of
Tariff issued by the Central Electricity Regulatory Commission (CERC) and GERC
(MYT) Regulations, 2016 notified by the Commission.
Section 61 of the Act lays down the broad principles, and guidelines for determination
of retail supply tariff. The basic principle is to ensure that the tariff should progressively
reflect the cost of supply of electricity and reduce the cross subsidies amongst
categories within a period to be specified by the Commission.

10.2. DISCOMs Tariff Proposal and Changes in Tariff Structure

Petitioner’s Submission

The change/revision/modification proposed in the tariff structure proposed by the

Petitioner for FY 2019-20 is as under:
Existing Provision
“Tariff Schedule”

10. RATE AG

This tariff is applicable to services used for irrigation purposes only excluding
installations covered under LTP- Lift Irrigation category.

Proposed Provision
“Tariff Schedule”

10. RATE AG

This tariff is applicable to services used for irrigation purposes only excluding (i)
installations covered under LTP- Lift Irrigation category, (ii) Floriculture, (iii)
Horticulture, (iv) Sericulture, (v) Fishries, (vi) Dairy, (vii) Tissue Culture activities, (viii)
Nursery.

Commission’s Analysis

The Commission has examined the proposal of the Licensee. Since, no detail was
produced by the Petitioner in the proposed change, the Commission has decided not

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to accept proposal of the Petitioner at this stage. Accordingly, there will be no change
in Tariff Schedule.

10.3. Rationalization of Tariff

Some of the stake holder have suggested to modify the Tariff Schedule. The details
suggestions considered by the Commission is given as under;

10.3.1 Extending benefit of Optional Demand Based Tariff to small

consumers
Some of the stake holder have suggested to insert option clause about availability of
demand-based tariff in the description of NRGP category also for the knowledge of the
consumers. It is also suggested to reduce minimum billing criteria for LTMD category
from 10 KW to 6 KW. The Commission has accepted both the suggestions and
necessary changes have been made in the Tariff Schedule attached with this Order.

10.3.2 Numbers of Slabs in RGP Tariff Category

It has been suggested by stake holders that one slab of 200 to 250 Unit should be
removed and one more slab for consumption more than 400 Unit is to be introduced
with higher rate of energy charges as consumers with higher capacity to pay have to
pay higher charges. The Commission agrees with the suggestion of removal of slab of
200 to 250 Unit and decides to merge it with the Slab of 100 to 200 Unit. Thus, the
Energy Charge Rate for the Consumption between 100 to 250 Unit/Month shall be
charged at Rs. 4.15 per Unit. In order to keep the slabs minimum, the Commission
does not accept the suggestion of introduction of new slab. With this modification there
will be total reduction of Rs. 5.31 Crore in the revenue of the four DISCOM.

10.3.3 Reduction in the Tariff for Lift Irrigation.

It has been represented before the Commission to reduce the tariff of Lift Irrigation and
make it at par with tariff of AG category since the end purpose of the usage of electricity
by consumers of both the categories is same. The Petitioner responded that the
consumers of Lift Irrigation category are being provided with 24 Hrs. supply whereas
consumers of AG category are getting supply for 8-10 hours on roster basis. Hence
both categories can not be equated though the end use of electricity by both the
categories is same. The Commission find it appropriate to differentiate among AG and
Lift Irrigation category. It has been observed by the Commission that in LTP-Lift
Irrigation category there are generally more than one consumers and in HTP V
category there is a group of consumers. In order to motivate the farmers who do not

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have at present any electricity connection form a co-operative society and take
advantage of Lift Irrigation wherein under one single connection a group of farmers
stand to benefit. This will also reduce their waiting period and on the other hand utilities’
list of pending applications will also get reduced, if a group of farmers form a co-
operative society and opts for Lift Irrigation under LTP-Lift Irrigation category / HTP V
category. This will help utilities in reducing their losses also. Accordingly, the
Commission considers to offer a tariff of Rs. 1.50/unit to the consumers of these
categories. With this modification, there will be impact of Rs. 0.71 Crore in the revenue
of the four DISCOMs.

With changes in Tariff as mentioned at Para 10.3.2 and 10.3.3, the total reduction is
expected to be Rs. 6.02 Crore in the Revenue of the four DISCOMs in FY 2019-20.

10.4. Deletion of Prompt Payment Rebate clause from the Tariff

Schedule
As per Clause 42.3 of the GERC (MYT) Regulations, 2016, it is optional for the
Distribution Utilities to allow rebate to consumer on payment of bills within seven days
of presentation of bills. Thus, providing rebate to consumer is not mandatory for
Distribution Licensees. The same provision was mentioned in the Tariff Schedule of
FY 2018-19, but was creating confusion amongst consumers that Distribution
Licensees are required to give rebate but are not giving. To avoid such kind of
confusion now onwards, the Commission finds it appropriate to delete the provision
from the Tariff Schedule of FY 2019-20. However, the stipulation made in Clause 42.3
read with Clause 42.4 of the GERC (MYT) Regulations, 2016 continues to be in force.
Hence, the Distributions licensees are free to provide rebate to the consumers but will
not be allowed as a cost item in the ARR of the Licensee.

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COMMISSION’S ORDER
The Commission approves the Aggregate Revenue Requirement for FY 2019-20 and FY
2020-21 in the Mid Term Review for UGVCL as shown in the Table below:

Approved ARR for FY 2019-20 and FY 2020-21

Sr. Approved for Mid-Term Review

Particulars
No. 2019-20 2020-21
1 Cost of Power Purchase 11128.50 11843.65
2 Operations & Maintenance Expenses 711.06 751.74
2.1 Employee Cost 608.92 643.75
2.2 Repair & Maintenance 68.58 72.50
2.3 Administration & General Charges 110.90 117.24
2.4 Other Debits 0.00 0.00
2.5 Extraordinary Items 0.00 0.00
2.6 Net Prior Period Expenses / (Income) 0.00 0.00
2.7 Other Expenses Capitalised (77.33) (81.76)
3 Depreciation 248.47 273.65
4 Interest & Guarantee Charges 163.43 173.91
5 Interest on Working Capital 0.00 0.00
6 Provision for Bad Debts 0.31 0.31
7 Sub-Total [1 to 6] 12251.77 13043.26
8 Return on Equity 215.36 231.86
9 Provision for Tax / Tax Paid 14.38 14.38
10 Total Expenditure (7 to 9) 12481.51 13289.50
11 Less: Non-Tariff Income 138.68 138.68
12 Aggregate Revenue Requirement (10 - 11) 12342.83 13150.82

The retail supply tariffs for UGVCL distribution area for FY 2019-20 determined by the
Commission are annexed to this Order. This Order shall come into force with effect from the
1st May 2019. The revised rate shall be applicable for the electricity consumption from the 1 st
May, 2019 onwards.

Sd/- Sd/- Sd/-

P. J. THAKKAR K. M. SHRINGARPURE ANAND KUMAR
Member Member Chairman

Place: Gandhinagar
Date: 24/04/2019

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ANNEXURE: TARIFF SCHEDULE

TARIFF FOR SUPPLY OF ELECTRICITY AT LOW TENSION, HIGH TENSION,

AND EXTRA HIGH TENSION
Effective from 1st May, 2019

GENERAL
1. The tariff figures indicated in this tariff schedule are the tariff rates payable by the
consumers of Distribution Licensees viz. DGVCL, MGVCL, PGVCL and UGVCL.
2. These tariffs are exclusive of Electricity Duty, tax on sale of electricity, taxes and other
charges levied by the Government or other competent authorities from time to time which
are payable by the consumers, in addition to the charges levied as per the tariff.
3. All these tariffs for power supply are applicable to only one point of supply.
4. The charges specified are on monthly basis. Distribution Licensee may decide the period
of billing and adjust the tariff rate accordingly.
5. Except in cases where the supply is used for purposes for which a lower tariff is provided
in the tariff schedule, the power supplied to any consumer shall be utilized only for the
purpose for which supply is taken and as provided for in the tariff.
6. The various provisions of the GERC (licensee’s power to recover expenditure incurred in
providing supply and other miscellaneous charges) Regulations, except Meter Charges,
will continue to apply.
7. Conversion of Ratings of electrical appliances and equipments from kilowatt to B.H.P. or
vice versa will be done, when necessary, at the rate of 0.746 kilowatt equal to 1 B.H.P.
8. The billing of fixed charges based on contracted load or maximum demand shall be done
in multiples of 0.5 (one half) Horse Power or kilo watt (HP or kW) as the case may be.
The fraction of less than 0.5 shall be rounded off to next 0.5. The billing of energy charges
will be done on complete one kilo-watt-hour (kWh).
9. The Connected Load for the purpose of billing will be taken as the maximum load
connected during the billing period.
10. The Fixed charges, minimum charges, demand charges, and the slabs of consumption of
energy for energy charges mentioned shall not be subject to any adjustment on account
of existence of any broken period within billing period arising from consumer supply being
connected or disconnected any time within the duration of billing period for any reason.
11. Contract Demand shall mean the maximum kW / kVA for the supply of which licensee

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undertakes to provide facilities to the consumer from time to time.

12. Fuel Cost and Power Purchase Adjustment Charges shall be applicable in accordance
with the Formula approved by the Gujarat Electricity Regulatory Commission from time to
time.
13. Payment of penal charges for usage in excess of contract demand / load for any billing
period does not entitle the consumer to draw in excess of contract demand / load as a
matter of right.
14. The payment of power factor penalty does not exempt the consumer from taking steps to
improve the power factor to the levels specified in the Regulations notified under the
Electricity Act, 2003 and licensee shall be entitled to take any other action deemed
necessary and authorized under the Act.
15. Delayed payment charges for all consumers:
 No delayed payment charges shall be levied if the bill is paid within ten days from the date
of billing (excluding date of billing).
 Delayed payment charges will be levied at the rate of 15% per annum in case of all
consumers except Agricultural category for the period from the due date till the date of
payment if the bill is paid after due date. Delayed payment charges will be levied at the
rate of 12% per annum for the consumer governed under Rate AG from the due date till
the date of payment if the bill is paid after due date.
 For Government dues, the delayed payment charges will be levied at the rate provided
under the relevant Electricity Duty Act.

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PART - I
SCHEDULE OF TARIFF FOR SUPPLY OF ELECTRICITY
AT LOW AND MEDIUM VOLTAGE
1. RATE: RGP

This tariff is applicable to all services in the residential premises which are not covered under
‘Rate: RGP (Rural)’ Category.
 Single-phase supply- Aggregate load up to 6 kW
 Three-phase supply- Aggregate load above 6 kW

1.1 FIXED CHARGES / MONTH:

Range of Connected Load: (Other than BPL Consumers)

(a) Up to and including 2 kW Rs. 15/- per month

(b) Above 2 to 4 kW Rs. 25/- per month

(c) Above 4 to 6 kW Rs. 45/- per month

(d) Above 6 kW Rs. 70/- per month

For BPL Household Consumers:

Fixed charges Rs. 5/- per month

PLUS
1.2 ENERGY CHARGES: FOR THE TOTAL MONTHLY CONSUMPTION:
(OTHER THAN BPL CONSUMERS)
(a) First 50 units 305 Paise per Unit

(b) Next 50 units 350 Paise per Unit

(c) Next 150 units 415 Paise per Unit

(d) Above 250 units 520 Paise per Unit

1.3 ENERGY CHARGES: FOR THE TOTAL MONTHLY CONSUMPTION:

FOR THE CONSUMER BELOW POVERTY LINE (BPL)**

(a) First 30 units 150 Paise per Unit

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(b) For remaining units Rate as per RGP

**The consumer who wants to avail the benefit of the above tariff has to produce a copy of the
Card issued by the authority concerned at the sub-division office of the Distribution Licensee.
The concessional tariff is only for 30 units per month.

1.4 MINIMUM BILL

Payment of fixed charges as specified in 1.1 above.

2. RATE: RGP (RURAL)

This tariff is applicable to all services for residential premises located in areas within Gram
Panchayat as defined in the Gujarat Panchayats Act.

 Single-phase supply- Aggregate load up to 6 kW

 Three-phase supply- Aggregate load above 6 kW

2.1 FIXED CHARGES / MONTH:

Range of Connected Load: (Other than BPL Consumers)

(a) Up to and including 2 kW Rs. 15/- per month

(b) Above 2 to 4 kW Rs. 25/- per month

(c) Above 4 to 6 kW Rs. 45/- per month

(d) Above 6 kW Rs. 70/- per month

For BPL Household Consumers:

Fixed charges Rs. 5/- per month

PLUS
2.2 ENERGY CHARGES: FOR THE TOTAL MONTHLY CONSUMPTION:

(OTHER THAN BPL CONSUMERS)

(a) First 50 units 265 Paise per Unit

(b) Next 50 units 310 Paise per Unit

(c) Next 150 units 375 Paise per Unit

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(d) Above 250 units 490 Paise per Unit

2.3 ENERGY CHARGES: FOR THE TOTAL MONTHLY CONSUMPTION:

FOR THE CONSUMER BELOW POVERTY LINE (BPL) **

(a) First 30 units 150 Paise per Unit

(b) For remaining units Rate as per RGP (Rural)

**The consumer who wants to avail the benefit of the above tariff has to produce a copy of the
Card issued by the authority concerned at the sub-division office of the Distribution Licensee.
The concessional tariff is only for 30 units per month.

2.4 MINIMUM BILL:

Payment of fixed charges as specified in 2.1 above.

Note: If the part of the residential premises is used for non-residential (commercial) purposes
by the consumers located within ‘Gram Panchayat’ as defined in Gujarat Panchayat Act, entire
consumption will be charged under this tariff.

3. RATE: GLP

This tariff is applicable to the educational institutes and other institutions registered with the
Charity Commissioner or similarly placed authority designated by the Government of India for
such intended purpose and research and development laboratories.

(a) Fixed charges Rs. 70/- per month

(b) Energy charges 390 Paise per Unit

4. RATE: NON-RGP

This tariff is applicable to the services for the premises those are not covered in any other tariff
categories and having aggregate load up to and including 40 kW.

Consumer under this category may opt to be charged as per category – ‘RATE:LTMD’.

4.1 FIXED CHARGES PER MONTH:

(a) First 10 kW of connected load Rs. 50/- per kW

(b) For next 30 kW of connected load Rs. 85/- per kW

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PLUS
4.2 ENERGY CHARGES:

(a) For installation having contracted load up to and including 10

435 Paise per Unit
kW: for entire consumption during the month

(b) For installation having contracted load exceeding 10 kW: for

465 Paise per Unit
entire consumption during the month

4.3 MINIMUM BILL PER INSTALLATION FOR SEASONAL CONSUMERS

(a) “Seasonal Consumer”, shall mean a consumer who takes and uses power supply
for ice factory, ice candy machines, ginning and pressing factory, oil mill, rice mill,
huller, salt industry, sugar factory, khandsari, cold storage plants (including such plants
in fisheries industry), tapioca industries manufacturing starch, etc.
(b) Any consumer, who desires to be billed for the minimum charges on annual basis
shall intimate to that effect in writing at least one month before commencement of
billing period about the off-season during which energy consumption, if any, shall be
mainly for overhauling of the plant and machinery. The off-season period at any time
shall be a full calendar month/months. The total period of the off-season so declared
and observed shall be not less than three calendar months in a calendar year.
(c) The total minimum amount under the head “Fixed and Energy Charges” payable
by the seasonal consumer satisfying the eligibility criteria under sub-clause (a) above
and complying with the provision stipulated under sub-clause (b) above shall be Rs.
1800 per annum per kW of the contracted load.
(d) The units consumed during the off-season period shall be charged for at a flat rate
of 480 Paise per unit.
(e) The electricity bills related to the off-season period shall not be taken into account
towards the amount payable against the annual minimum bill. The amount paid by the
consumer towards the electricity bills related to the seasonal period only under the
heads “Fixed Charges” and “Energy Charges”, shall be taken into account while
determining the amount of short-fall payable towards the annual minimum bill as
specified under sub-clause (c) above.

5. RATE: LTMD

This tariff is applicable to the services for the premises those are not covered in any other tariff

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categories and having aggregate load above 40 kW and up to 100 kW.

This tariff shall also be applicable to consumer covered in category- ‘Rate: Non-RGP’ so opts
to be charged in place of ‘Rate: Non-RGP’ tariff.

5.1 FIXED CHARGES:

For billing demand up to the contract demand

(i) For first 40 kW of billing demand Rs. 90/- per kW per month

(a) (ii) Next 20 kW of billing demand Rs. 130/- per kW per month

(iii) Above 60 kW of billing demand Rs. 195/- per kW per month

For billing demand in excess of the contract

(b) Rs. 265/- per kW
demand

PLUS
5.2 ENERGY CHARGES:

For the entire consumption during the month 460 Paise per Unit

PLUS

5.3 REACTIVE ENERGY CHARGES:

For all the reactive units (KVARH) drawn during the month 10 paise per KVARH

5.4 BILLING DEMAND

The billing demand shall be highest of the following:

(a) Eighty-five percent of the contract demand
(b) Actual maximum demand registered during the month
(c) 6 kW

5.5 MINIMUM BILL

Payment of demand charges every month based on the billing demand.

5.6 SEASONAL CONSUMERS TAKING LTMD SUPPLY:
5.6.1 The expression, “Seasonal Consumer”, shall mean a consumer who takes and uses
power supply for ice factory, ice-candy machines, ginning and pressing factory, oil mill,
rice mill, salt industry, sugar factory, khandsari, cold storage plants (including such

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plants in fishery industry), tapioca industries manufacturing starch, pumping load or

irrigation, white coal manufacturers etc.
5.6.2 Any consumer, who desires to be billed for the minimum charges on annual basis shall
intimate to that effect in writing at least one month before commencement of billing
period about the off-season during which energy consumption, if any, shall be mainly
for overhauling of the plant and machinery. The off-season period at any time shall be
a full calendar month/months. The total period of the off-season so declared and
observed shall be not less than three calendar months in a calendar year.
5.6.3 The total minimum amount under the head “Demand and Energy Charges” payable by
a seasonal consumer satisfying the eligibility criteria under sub-clause 5.6.1 above and
complying with provisions stipulated under sub-clause 5.6.2 above shall be Rs. 2970
per annum per kW of the billing demand.
5.6.4 The billing demand shall be the highest of the following:
(a) The highest of the actual maximum demand registered during the calendar year.
(b) Eighty-five percent of the arithmetic average of contract demand during the year.
(c) 6 kW
5.6.5 Units consumed during the off-season period shall be charged for at the flat rate of
470 Paise per unit.

6. RATE: NON-RGP NIGHT

This tariff is applicable for aggregate load up to 40 kW and using electricity exclusively during
night hours from 10:00 PM to 06:00 AM next day. (The supply hours shall be regulated
through time switch to be provided by the consumer at his cost.)

6.1 FIXED CHARGES PER MONTH:

50% of the Fixed charges specified in Rate Non-RGP above.

PLUS
6.2 ENERGY CHARGES:

For entire consumption during the month 260 Paise per Unit

NOTE:
1. 15% of the contracted demand can be availed beyond the night hours prescribed as per
para 6 above.
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2. 10% of total units consumed during the billing period can be availed beyond the night hours
prescribed as per para 6 above.
3. In case the consumer failed to observe condition no. 1 above during any of the billing
month, then demand charge during the relevant billing month shall be billed as per Non-
RGP category demand charge rates given in para 4.1 of this schedule.
4. In case the consumer failed to observe condition no. 2 above during any of the billing
month, then entire energy consumption during the relevant billing month shall be billed as
per Non-RGP category energy charge rates given in para 4.2 of this schedule.
5. In case the consumer failed to observe above condition no. 1 and 2 both during any of the
billing month, then demand charge and entire energy consumption during the relevant
billing month shall be billed as per Non-RGP category demand charge and energy charge
rates given in para 4.1 and 4.2 respectively, of this schedule.
6. This tariff shall be applicable if the consumer so opts to be charged in place of Non-RGP
tariff by using electricity exclusively during night hours as above.
7. This option can be exercised to shift from NON-RGP tariff category to NON-RGP NIGHT
tariff or from NON-RGP NIGHT tariff category to NON-RGP tariff four times in a calendar
year by giving not less than 15 days’ advance notice in writing before commencement of
billing period.

7. RATE: LTMD- NIGHT

This tariff is applicable for aggregate load above 40 kW and using electricity exclusively
during night hours from 10.00 PM to 06.00 AM next day. (The supply hours shall be
regulated through time switch to be provided by the consumer at his cost.)

7.1 FIXED CHARGES PER MONTH:

50% of the Fixed charges specified in Rate LTMD above.

PLUS
7.2 ENERGY CHARGES:

For entire consumption during the month 260 Paise per Unit

PLUS

7.3 REACTIVE ENERGY CHARGES:

For all reactive units (KVARH) drawn during the month 10 Paise per KVARH

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NOTE:
1. 15% of the contracted demand can be availed beyond the night hours prescribed as per
para 7 above.
2. 10% of total units consumed during the billing period can be availed beyond the night
hours prescribed as per para 7 above.
3. In case the consumer failed to observe condition no. 1 above during any of the billing
month, then demand charge during the relevant billing month shall be billed as per LTMD
category demand charge rates given in para 5.1 of this schedule.
4. In case the consumer failed to observe condition no. 2 above during any of the billing
month, then entire energy consumption during the relevant billing month shall be billed as
per LTMD category energy charge rates given in para 5.2 of this schedule.
5. In case the consumer failed to observe above condition no. 1 and 2 both during any of the
billing month, then demand charge and entire energy consumption during the relevant
billing month shall be billed as per LTMD category demand charge and energy charge
rates given in para 5.1 and 5.2 respectively, of this schedule.
6. This tariff shall be applicable if the consumer so opts to be charged in place of LTMD tariff
by using electricity exclusively during night hours as above.
7. This option can be exercised to shift from LTMD tariff category to LTMD-NIGHT tariff or
from LTMD-NIGHT tariff category to LTMD tariff four times in a calendar year by giving not
less than 15 days’ advance notice in writing before commencement of billing period.

8. RATE: LTP- LIFT IRRIGATION

Applicable for supply of electricity to Low Tension Agricultural consumers contracting load up
to 125 HP requiring continuous (twenty-four hours) power supply for lifting water from surface
water sources such as canal, river, & dam and supplying water directly to the fields of farmers
for agricultural irrigation only.

(a) Fixed charges per month Rs. 20/- per HP

PLUS

Energy charges
(b) 150 Paise per Unit
For entire consumption during the month

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9. RATE: WWSP

This tariff shall be applicable to services used for water works and sewerage pumping
purposes.
9.1 Type I – Water works and sewerage pumps operated by other than local authority:

(a) Fixed charges per month Rs. 25/- per HP

PLUS

Energy charges per month:

(b) 430 Paise per Unit
For entire consumption during the month

9.2 Type II – Water works and sewerage pumps operated by local authority such as
Municipal Corporation, Gujarat Water Supply & Sewerage Board located outside Gram
Panchayat Area will also attract this tariff:

(a) Fixed charges per month Rs. 20 per HP

PLUS

Energy charges per month:

(b) 410 Paise per Unit
For entire consumption during the month

9.3 Type III – Water works and sewerage pumps operated by Municipalities / Nagarpalikas
and Gram Panchayats or Gujarat Water Supply & Sewerage Board for its installations
located in Gram Panchayats:

Energy charges per month:

320 Paise/Unit
For entire consumption during the month

9.4 TIME OF USE DISCOUNT:

Applicable to all the water works consumers having connected load of 50 HP and above for
the energy consumption during the Off-Peak Load Hours of the Day.

For energy consumption during the off-peak period, viz., 1100

40 Paise per Unit
Hrs. to 1800 Hrs.

For energy consumption during night hours, viz., 2200 Hrs. to

85 Paise per Unit
0600 Hrs. next day

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10. RATE: AG

This tariff is applicable to services used for irrigation purposes only excluding installations
covered under LTP- Lift Irrigation category.

10.1 The rates for following group are as under:

10.1.1 HP BASED TARIFF:

For entire contracted load Rs. 200 per HP per month

ALTERNATIVELY
10.1.2 METERED TARIFF:

Fixed Charges Rs. 20 per HP per month

Energy Charges: For entire consumption 60 Paise per Unit per month

10.1.3 TATKAL SCHEME:

Fixed Charges Rs. 20 per HP per month

Energy Charges: For entire consumption 80 Paise per Unit per month

NOTE: The consumers under Tatkal Scheme shall be eligible for normal metered tariff as
above, on completion of five years period from the date of commencement of supply.

10.2 No machinery other than pump water for irrigation (and a single bulb or CFL up to 40
watts) will be permitted under this tariff. Any other machinery connected in the
installation governed under this tariff shall be charged separately at appropriate tariff
for which consumers shall have to take separate connection.
10.3 Agricultural consumers who desire to supply water to brick manufacturing units shall
have to pay Rs. 100/HP per annum subject to minimum of Rs. 2000/- per year for each
brick Mfg. Unit to which water is supplied in addition to existing rate of HP based /
metered agricultural tariff.
10.4 Such Agricultural consumers shall have to pay the above charges for a full financial
year irrespective of whether they supply water to the brick manufacturing unit for full
or part of the Financial Year.

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Agricultural consumers shall have to declare their intention for supply of the water to
such brick manufacturing units in advance and pay charges accordingly before
commencement of the financial year (i.e. in March every year).

11. RATE: SL

11.1 Tariff for Street Light for Local Authorities and Industrial Estates:

This tariff includes the provision of maintenance, operation and control of the street lighting
system.

11.1.1 ENERGY CHARGES:

For all the units consumed during the month: 405 Paise per Unit

11.1.2 OPTIONAL KVAH CHARGES:

For all the kVAh units consumed during the month: 305 Paise per Unit

11.1.3 Renewal and Replacements of Lamps:

The consumer shall arrange for renewal, maintenance and replacement of lamp, associated
Fixture, connecting wire, disconnecting device, switch including time switch etc. at his cost by
person authorised by him in this behalf under Rule-3 of the Indian Electricity Rules, 1956 /
Rules issued by CEA under the Electricity Act, 2003.

11.1.4 Maintenance other than Replacement of Lamps:

Maintenance of the street lighting conductor provided on pole to connect the street light shall
be carried out by Distribution Licensee.

11.2 Tariff for power supply for street lighting purposes to consumers other than the
local authorities and industrial estates:

11.2.1 FIXED CHARGES:

Rs. 30 per kW per month

11.2.2 ENERGY CHARGES:

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For all units consumed during the month 405 Paise per kWh

11.2.3 Renewal and Replacement of Lamps:

The consumer shall arrange for renewal, maintenance and replacement of lamp, associated
Fixture, connecting wire, disconnecting device, switch including time switch etc. at his cost by
person authorised by him in this behalf under Rule-3 of the Indian Electricity Rules, 1956 /
Rules issued by CEA under the Electricity Act, 2003.

11.2.4 Maintenance other than Replacement of Lamps:

Maintenance of the street lighting conductor provided on pole to connect the street light shall
be carried out by Distribution Licensee.

12. RATE: TMP

This tariff is applicable to services of electricity supply for temporary period at the low voltage.
A consumer not taking supply on regular basis under a proper agreement shall be deemed to
be taking supply for temporary period.

12.1 FIXED CHARGE

Fixed Charge per Installation Rs. 15 per kW per Day

12.2 ENERGY CHARGE

A flat rate of 465 Paise per Unit

Note: Payment of bills is to be made within seven days from the date of issue of the bill. Supply
would be disconnected for non-payment of dues on 24 hours’ notice.

13. RATE: LT ELECTRIC VEHICLE (EV) CHARGING STATIONS

This tariff is applicable to consumers who use electricity exclusively for Electric Vehicle
Charging installations.

Other consumers can use their regular electricity supply for charging electric vehicle under
same regular category i.e. RGP, RGP (RURAL), GLP, LTMD, NON-RGP NIGHT, LTMD-
NIGHT, etc. as the case may be.

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13.1 FIXED CHARGES / MONTH:

Fixed Charge Rs. 25 per installation

13.2 ENERGY CHARGES: FOR THE ENTIRE MONTHLY CONSUMPTION

ENERGY CHARGE 410 Paise per Unit

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PART - II
TARIFFS FOR SUPPLY OF ELECTRICITY AT HIGH TENSION
(3.3 KV AND ABOVE, 3-PHASE 50 HERTZ), AND EXTRA HIGH TENSION

The following tariffs are available for supply at high tension for large power services for
contract demand not less than 100 kVA

14. RATE: HTP-I

This tariff will be applicable for supply of electricity to HT consumers contracted for 100 kVA
and above for regular power supply and requiring the power supply for the purposes not
specified in any other HT Categories.

14.1 DEMAND CHARGES:

14.1.1 For billing demand up to contract demand

(a) For first 500 kVA of billing demand Rs. 150/- per kVA per month

(b) For next 500 kVA of billing demand Rs. 260/- per kVA per month

(c) For billing demand in excess of 1000 kVA Rs. 475/- per kVA per month

14.1.2 For Billing Demand in Excess of Contract Demand

For billing demand in excess over the contract

Rs. 555 per kVA per month
demand

PLUS
14.2 ENERGY CHARGES

For entire consumption during the month

(a) Up to 500 kVA of billing demand 400 Paise per Unit

For billing demand above 500 kVA and up to 2500

(b) 420 Paise per Unit
kVA

(c) For billing demand above 2500 kVA 430 Paise per Unit

PLUS
14.3 TIME OF USE CHARGES:

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For energy consumption during the two peak periods,

viz., 0700 Hrs. to 1100 Hrs. and 1800 Hrs. to 2200 Hrs.

(a) For Billing Demand up to 500 kVA 45 Paise per Unit

(b) For Billing Demand above 500 kVA 85 Paise per Unit

14.4 BILLING DEMAND:

The billing demand shall be the highest of the following:

(a) Actual maximum demand established during the month
(b) Eighty-five percent of the contract demand
(c) One hundred kVA

14.5 MINIMUM BILLS:

Payment of “demand charges” based on kVA of billing demand.

14.6 POWER FACTOR ADJUSTMENT CHARGES:
14.6.1 Penalty for poor Power Factor:
(a) The power factor adjustment charges shall be levied at the rate of 1% on the total
amount of electricity bills for the month under the head “Energy Charges”, arrived
at using tariff as per para 14.2 of this schedule, for every 1% drop or part thereof
in the average power factor during the month below 90% up to 85%.
(b) In addition to the above clause, for every 1% drop or part thereof in average power
factor during the month below 85% at the rate of 2% on the total amount of
electricity bill for that month under the head “Energy Charges”, arrived at using
tariff as per para 14.2 of this schedule, will be charged.
14.6.2 Power Factor Rebate:

If the power factor of the consumer’s installation in any month is above 95%, the consumer
will be entitled to a rebate at the rate of 0.5% (half percent) in excess of 95% power factor on
the total amount of electricity bill for that month under the head “Energy Charges”, arrived at
using tariff as per para 14.2 of this schedule, for every 1% rise or part thereof in the average
power factor during the month above 95%.

14.7 MAXIMUM DEMAND AND ITS MEASUREMENT:

The maximum demand in kW or kVA, as the case may be, shall mean an average kW / kVA
supplied during consecutive 30/15 minutes or if consumer is having parallel operation with the

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grid and has opted for 3 minutes, period of maximum use where such meter with the features
of reading the maximum demand in KW/KVA directly, have been provided.

14.8 CONTRACT DEMAND:

The contract demand shall mean the maximum KW/KVA for the supply, of which the supplier
undertakes to provide facilities from time to time.

14.9 REBATE FOR SUPPLY AT EHV:

On Energy charges: Rebate @

(a) If supply is availed at 33/66 kV 0.5%

(b) If supply is availed at 132 kV and above 1.0%

14.10 CONCESSION FOR USE OF ELECTRICITY DURING NIGHT HOURS:

For the consumer eligible for using supply at any time during 24 hours, entire consumption
shall be billed at the energy charges specified above. However, the energy consumed during
night hours of 10.00 PM to 06.00 AM next morning shall be eligible for concession at the rate
of 40 Paise per unit.

14.11 SEASONAL CONSUMERS TAKING HT SUPPLY:

14.11.1 The expression, “Seasonal Consumer”, shall mean a consumer who takes and uses
power supply for ice factory, ice-candy machines, ginning and pressing factory, oil
mill, rice mill, salt industry, sugar factory, khandsari, cold storage plants (including
such plants in fishery industry), tapioca industries manufacturing starch, pumping
load or irrigation, white coal manufacturers etc.
14.11.2 Any consumer, who desires to be billed for the minimum charges on annual basis
shall intimate to that effect in writing at least one month before commencement of
billing period about the off-season during which energy consumption, if any, shall be
mainly for overhauling of the plant and machinery. The off-season period at any time
shall be a full calendar month/months. The total period of the off-season so declared
and observed shall be not less than three calendar months in a calendar year.
14.11.3 The total minimum amount under the head “Demand and Energy Charges” payable
by a seasonal consumer satisfying the eligibility criteria under sub-clause 14.11.1
above and complying with provisions stipulated under sub-clause 14.11.2 above
shall be Rs. 4550 per annum per kVA of the billing demand.
14.11.4 The billing demand shall be the highest of the following:

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(a) The highest of the actual maximum demand registered during the calendar year.
(b) Eighty-five percent of the arithmetic average of contract demand during the year.
(c) One hundred kVA.
14.11.5 Units consumed during the off-season period shall be charged for at the flat rate of
430 Paise per unit.
14.11.6 Electricity bills paid during off-season period shall not be taken into account towards
the amount payable against the annual minimum bill. The amount paid by the
consumer towards the electricity bills for seasonal period only under the heads
“Demand Charges” and “Energy Charges” shall be taken into account while
determining the amount payable towards the annual minimum bill.

15. RATE HTP-II

Applicability: This tariff shall be applicable for supply of energy to HT consumers contracting
for 100 kVA and above, requiring power supply for Water Works and Sewerage pumping
stations run by Local Authorities and GW & SB. GIDC Water Works.

15.1 DEMAND CHARGES:

15.1.1 For billing demand up to contract demand

(a) For first 500 kVA of billing demand Rs. 115/- per kVA per month

(b) For next 500 kVA of billing demand Rs. 225/- per kVA per month

(c) For billing demand in excess of 1000 kVA Rs. 290/- per kVA per month

15.1.2 For billing demand in excess of contract demand

For billing demand in excess of contract demand Rs. 360 per kVA per month

PLUS
15.2 ENERGY CHARGES:

For entire consumption during the month

(b) Up to 500 kVA of billing demand 435 Paise per Unit

(c) For billing demand above 500 kVA and up to 2500 kVA 455 Paise per Unit

(d) For billing demand above 2500 kVA 465 Paise per Unit

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PLUS
15.3 TIME OF USE CHARGES:

For energy consumption during the two peak periods,

viz., 0700 Hrs. to 1100 Hrs. and 1800 Hrs. to 2200 Hrs.

(a) For Billing Demand up to 500 kVA 45 Paise per Unit

(b) For Billing Demand above 500 kVA 85 Paise per Unit

15.4 Billing demand

15.5 Minimum bill
Same as per
15.6 Maximum demand and its measurement
HTP-I Tariff
15.7 Contract Demand
15.8 Rebate for supply at EHV
15.9 Concession for use of electricity during night hours

15.10 POWER FACTOR ADJUSTMENT CHARGES:

15.10.1 Penalty for poor Power Factor:
(a) The power factor adjustment charges shall be levied at the rate of 1% on the total
amount of electricity bills for the month under the head “Energy Charges”, arrived
at using tariff as per para 15.2 of this schedule, for every 1% drop or part thereof
in the average power factor during the month below 90% up to 85%.
(b) In addition to the above clause, for every 1% drop or part thereof in average power
factor during the month below 85% at the rate of 2% on the total amount of
electricity bill for that month under the head “Energy Charges”, arrived at using
tariff as per para 15.2 of this schedule, will be charged.

15.10.2 Power Factor Rebate:

If the power factor of the consumer’s installation in any month is above 95%, the consumer
will be entitled to a rebate at the rate of 0.5% (half percent) in excess of 95% power factor on
the total amount of electricity bill for that month under the head “Energy Charges”, arrived at
using tariff as per para 15.2 of this schedule, for every 1% rise or part thereof in the average
power factor during the month above 95%.

16. RATE: HTP-III

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This tariff shall be applicable to a consumer taking supply of electricity at high voltage,
contracting for not less than 100 kVA for temporary period. A consumer not taking supply on
regular basis under a proper agreement shall be deemed to be taking supply for temporary
period.

16.1 DEMAND CHARGES:

For billing demand up to contract demand Rs. 18/- per kVA per day

For billing demand in excess of contract demand Rs. 20/- per kVA per day

PLUS
16.2 ENERGY CHARGES:

For all units consumed during the month 660 Paise/Unit

PLUS
16.3 TIME OF USE CHARGES:

Additional charge for energy consumption during two peak

periods, viz., 0700 Hrs. to 1100 Hrs. and 1800 Hrs. to 2200 85 Paise per Unit
Hrs.

16.4 Billing demand

16.5 Minimum bill
Same as per
16.6 Maximum demand and its measurement
HTP-I Tariff
16.7 Contract Demand
16.8 Rebate for supply at EHV

16.9 POWER FACTOR ADJUSTMENT CHARGES:

16.9.1 Penalty for poor Power Factor:
(a) The power factor adjustment charges shall be levied at the rate of 1% on the total
amount of electricity bills for the month under the head “Energy Charges”, arrived at
using tariff as per para 16.2 of this schedule, for every 1% drop or part thereof in the
average power factor during the month below 90% up to 85%.
(b) In addition to the above clause, for every 1% drop or part thereof in average power
factor during the month below 85% at the rate of 2% on the total amount of electricity
bill for that month under the head “Energy Charges”, arrived at using tariff as per para
16.2 of this schedule, will be charged.

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16.9.2 Power Factor Rebate:

If the power factor of the consumer’s installation in any month is above 95%, the consumer
will be entitled to a rebate at the rate of 0.5% (half percent) in excess of 95% power factor on
the total amount of electricity bill for that month under the head “Energy Charges”, arrived at
using tariff as per para 16.2 of this schedule, for every 1% rise or part thereof in the average
power factor during the month above 95%.

17 RATE: HTP-IV

This tariff shall be applicable for supply of electricity to HT consumers opting to use electricity
exclusively during night hours from 10.00 PM to 06.00 AM next day and contracted for regular
power supply of 100 kVA and above.

17.1 DEMAND CHARGES:

1/3rd of the Fixed Charges specified in Rate HTP-I above.

PLUS
17.2 ENERGY CHARGES:

For all units consumed during the month 225 Paise per Unit

17.3 Billing demand

17.4 Minimum bill
17.5 Maximum demand and its measurement Same as per HTP-
I Tariff
17.6 Contract Demand
17.7 Rebate for supply at EHV

17.8 POWER FACTOR ADJUSTMENT CHARGES:

17.8.1 Penalty for poor Power Factor:
(a) The power factor adjustment charges shall be levied at the rate of 1% on the total
amount of electricity bills for the month under the head “Energy Charges”, arrived
at using tariff as per para 17.2 of this schedule, for every 1% drop or part thereof
in the average power factor during the month below 90% up to 85%.
(b) In addition to the above clause, for every 1% drop or part thereof in average power
factor during the month below 85% at the rate of 2% on the total amount of
electricity bill for that month under the head “Energy Charges”, arrived at using
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tariff as per para 17.2 of this schedule, will be charged.

17.8.2 Power Factor Rebate:

If the power factor of the consumer’s installation in any month is above 95%, the consumer
will be entitled to a rebate at the rate of 0.5% (half percent) in excess of 95% power factor on
the total amount of electricity bill for that month under the head “Energy Charges”, arrived at
using tariff as per para 17.2 of this schedule, for every 1% rise or part thereof in the average
power factor during the month above 95%.

NOTE:
1. 15% of the contracted demand can be availed beyond the night hours prescribed as
per para 16 above.
2. 10% of total units consumed during the billing period can be availed beyond the night
hours prescribed as per para 16 above.
3. In case the consumer failed to observe condition no. 1 above during any of the billing
month, then demand charge during the relevant billing month shall be billed as per
HTP-I category demand charge rates given in para 14.1 of this schedule.
4. In case the consumer failed to observe condition no. 2 above during any of the billing
month, then entire energy consumption during the relevant billing month shall be billed
as per HTP-I category energy charge rates given in para 14.2 of this schedule.
5. In case the consumer failed to observe above condition no. 1 and 2 both during any of
the billing month, then demand charge and entire energy consumption during the
relevant billing month shall be billed as per HTP-I category demand charge and energy
charge rates given in para 14.1 and 14.2 respectively, of this schedule.
6. This tariff shall be applicable if the consumer so opts to be charged in place of HTP-I
tariff by using electricity exclusively during night hours as above.
7. This option can be exercised to shift from HTP-I tariff category to HTP-IV tariff or from
HTP-IV tariff category to HTP-I tariff four times in a calendar year by giving not less
than 15 days’ advance notice in writing before commencement of billing period

18 RATE: HTP- V

HT - Agricultural (for HT Lift Irrigation scheme only)

This tariff shall be applicable for supply of electricity to High Tension Agricultural consumers
contracting for 100 kVA and above, requiring power supply for lifting water from surface water

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sources such as canal, river and dam, and supplying water directly to the fields of farmers for
agricultural irrigation only.

18.1 DEMAND CHARGES:

Demand Charges Rs. 25 per kVA per month

PLUS
18.2 ENERGY CHARGES:

For all units consumed during the month 150 Paise per Unit

18.3 Billing demand

18.4 Minimum bill
Same as per
18.5 Maximum demand and its measurement
HTP-I Tariff
18.6 Contract Demand
18.7 Rebate for supply at EHV

18.8 POWER FACTOR ADJUSTMENT CHARGES:

18.8.1 Penalty for poor Power Factor:
(a) The power factor adjustment charges shall be levied at the rate of 1% on the
total amount of electricity bills for the month under the head “Energy Charges”,
arrived at using tariff as per para 18.2 of this schedule, for every 1% drop or
part thereof in the average power factor during the month below 90% up to
85%.
(b) In addition to the above clause, for every 1% drop or part thereof in average
power factor during the month below 85% at the rate of 2% on the total amount
of electricity bill for that month under the head “Energy Charges”, arrived at
using tariff as per para 18.2 of this schedule, will be charged.

18.8.2 Power Factor Rebate:

If the power factor of the consumer’s installation in any month is above 95%, the consumer
will be entitled to a rebate at the rate of 0.5% (half percent) in excess of 95% power factor on
the total amount of electricity bill for that month under the head “Energy Charges”, arrived at
using tariff as per para 18.2 of this schedule, for every 1% rise or part thereof in the average

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power factor during the month above 95%.

19 RATE: RAILWAY TRACTION

This tariff is applicable for power supply to Railway Traction at 132 kV/66 kV.

19.1 DEMAND CHARGES:

(a) For billing demand up to the contract demand Rs. 180 per kVA per month

(b) For billing demand in excess of contract demand Rs. 425 per kVA per month

NOTE: In case of the load transfer for traction supply due to non-availability of power supply
at preceding or succeeding point of supply or maintenance at Discom’s level, excess demand
over the contract demand shall be charged at normal rate at appropriate point of supply.

Normal Demand Charges will also apply in case of bunching of trains. However, Discoms shall
charge excess demand charges while raising the bills and Railways have to give convincing
details and documentary proof of bunching of trains if they want to be charged at the normal
demand charges. If satisfactory proof of bunching of trains is provided, Discom shall consider
that occasion for normal demand charges, otherwise excess demand charges will be
applicable specified as above at 19.1 (b).

PLUS
19.2 ENERGY CHARGES:

For all units consumed during the month 500 Paise per Unit

19.3 Billing demand

19.4 Minimum bill
19.5 Maximum demand and its measurement Same as per

19.6 Contract Demand HTP-I Tariff

19.7 Rebate for supply at EHV

19.8 POWER FACTOR ADJUSTMENT CHARGES:

19.8.1 Penalty for poor Power Factor:
(a) The power factor adjustment charges shall be levied at the rate of 1% on the total
amount of electricity bills for the month under the head “Energy Charges”, arrived at
using tariff as per para 19.2 of this schedule, for every 1% drop or part thereof in the

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average power factor during the month below 90% up to 85%.

(b) In addition to the above clause, for every 1% drop or part thereof in average power
factor during the month below 85% at the rate of 2% on the total amount of electricity
bill for that month under the head “Energy Charges”, arrived at using tariff as per para
19.2 of this schedule, will be charged.

19.8.2 Power Factor Rebate:

If the power factor of the consumer’s installation in any month is above 95%, the consumer
will be entitled to a rebate at the rate of 0.5% (half percent) in excess of 95% power factor on
the total amount of electricity bill for that month under the head “Energy Charges”, arrived at
using tariff as per para 19.2 of this schedule, for every 1% rise or part thereof in the average
power factor during the month above 95%.

20 RATE: HT ELECTRIC VEHICLE (EV) CHARGING STATIONS

This tariff is applicable to consumers who use electricity exclusively for Electric Vehicle
Charging installations.

Other consumers can use their regular electricity supply for charging electric vehicle under
same regular category i.e. HTP-I, HTP-II, HTP-III, HTP-IV, HTP-V, RAILWAY TRACTION as
the case may be.

20.1 DEMAND CHARGES:

For billing demand up to contract demand Rs. 25/- per kVA per Month

For billing demand in excess of contract demand Rs. 50/- per kVA per Month

PLUS

20.2 ENERGY CHARGES: FOR THE TOTAL MONTHLY CONSUMPTION

ENERGY CHARGE 400 Paise per Unit

20.3 BILLING DEMAND:

The billing demand shall be the highest of the following:

(a) Actual maximum demand established during the month
(b) Eighty-five percent of the contract demand

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(c) One hundred kVA

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