Paschim Gujarat Vij Company Ltd

BEFORE THE GUJARAT ELECTRICITY REGULATORY COMMISSION GANDHINAGAR

CASE NO. 1914 of 2020

Filing of Petition for True Up for FY 2019-20

Under GERC (Multi Year Tariff) Regulations, 2016 along with other Guidelines and Directions issued by the GERC from time to time AND under Part VII (Section 61 to Section 64) of the Electricity Act, 2003 read with the relevant Guidelines

Filed by:- Paschim Gujarat Vij Company Ltd.

Corp. Office: Paschim Gujarat Vij Seva Sadan, Off. Nana Mava Main Road, Laxminagar, Rajkot– 360004.

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Petition for True Up for FY 2019-20

BEFORE THE GUJARAT ELECTRICITY REGULATORY COMMISSION

GANDHINAGAR

Filing No:

Case No:

IN THE MATTER OF Filing of the Petition for True Up for FY 2019-20, under GERC (Multi Year Tariff) Regulations, 2016 along with other Guidelines and Directions` issued by the GERC from time to time AND under Part VII (Section 61 to Section 64) of the Electricity Act, 2003 read with the relevant Guidelines

AND

IN THE MATTER OF Paschim Gujarat Vij Company Limited, Paschim Gujarat Vij Seva Sadan, Off. Nana Mava Main Road, Laxminagar, Rajkot – 360004.

PETITIONER

Gujarat Urja Vikas Nigam Limited Sardar Patel Vidyut Bhavan, Race Course, Vadodara - 390 007

CO-PETITIONER

THE PETITIONER ABOVE NAMED RESPECTFULLY SUBMITS

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TABLE OF CONTENTS

Section 1. Introduction ...... 6 1.1. Preamble ...... 6 1.2. Introduction ...... 6 1.3. Filing of True-up Petition for FY 2019-20 ...... 7 Section 2. Executive Summary ...... 8 2.1. Preamble ...... 8 2.2. True Up of FY 2019-20 ...... 8 Section 3. True Up for FY 2019-20 ...... 11 3.1. Preamble ...... 11 3.2. Principles for True Up for FY 2019-20 ...... 11 3.3. Category wise Sales ...... 11 3.4. Distribution Losses ...... 12 3.5. Energy Requirement and Energy Balance ...... 12 3.6. Power Purchase Cost...... 13 3.7. Capital Expenditure ...... 15 3.8. Funding of Capitalisation ...... 19 3.9. Fixed Cost for FY 2019-20 ...... 19 3.10. Operation & Maintenance Expenses ...... 19 3.11. Depreciation ...... 24 3.12. Interest & Financial Charges ...... 25 3.13. Interest on Working Capital ...... 26 3.14. Provision for Bad Debts ...... 26 3.15. Return on equity ...... 27 3.16. Income Taxes ...... 27 3.17. Non-Tariff Income for FY 2019-20 ...... 28 3.18. Aggregate Revenue Requirement for FY 2019-20 ...... 28 3.19. Sharing of Gains & Losses ...... 29 3.20. Sharing of Gain/ (Loss) for FY 2019-20...... 30 3.21. Revenue for FY 2019-20 ...... 31 3.22. Revenue Gap/Surplus for FY 2019-20 ...... 31 Section 4. compliance of Directives ...... 33 4.1. Preamble ...... 33 4.2. Compliance of Directives ...... 33 Section 5. Prayer ...... 39 Section 6. ANNEXURE 1: Tariff Filing Formats ...... 42

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LIST OF TABLES Table 1 : True Up For FY 2019-20 ...... 8 Table 2 : Summary of Controllable and Uncontrollable Factors for FY 2019-20 ...... 9 Table 3 : Revenue Gap for FY 2019-20 ...... 10 Table 4 : Category-wise Sales ...... 12 Table 5 : Distribution Losses ...... 12 Table 6 : Energy Requirement and Energy Balance ...... 13 Table 7: Net Power Purchase Cost ...... 13 Table 8 : Gain/ (Loss) on account of Distribution Losses for FY 2019-20 ...... 14 Table 9 : Gains / (Loss) - Power Purchase Expenses ...... 15 Table 10 : Capital Expenditure ...... 16 Table 11 : Funding of Capitalisation ...... 19 Table 12 : Operation & Maintenance Expenses ...... 20 Table 13 : Treatment of Operation & Maintenance Expenses ...... 21 Table 14 : Calculation of uncontrollable Employee Cost during FY 2019-20 ...... 22 Table 15 : Employee Cost for FY 2019-20 ...... 22 Table 16 : Repair & Maintenance Cost for FY 2019-20 ...... 23 Table 17 : Administration & General Expenses for FY 2019-20 ...... 23 Table 18: Other Expenses Capitalised ...... 23 Table 19 : Fixed Asset and Depreciation for FY 2019-20 ...... 24 Table 20 : Treatment of Depreciation ...... 25 Table 21 : Interest & Finance Charges ...... 25 Table 22 : Treatment of Interest & Finance Charges ...... 26 Table 23 : Interest on Working Capital ...... 26 Table 24: Bad & Doubtful Debts Written Off ...... 26 Table 25 : Treatment of bad & doubtful debts ...... 27 Table 26 : Return on Equity ...... 27 Table 27 : Treatment of Return on Equity ...... 27 Table 28 : Income Tax ...... 28 Table 29 : Treatment of Income Tax ...... 28 Table 30 : Treatment of Non-tariff Income ...... 28 Table 31 : Aggregate Revenue Requirement for FY 2019-20...... 29 Table 32 : Net Gain/ (Loss) for FY 2019-20 ...... 31 Table 33 : Revenue for FY 2019-20 ...... 31 Table 34 : Revenue Gap/ (Surplus) for FY 2019-20 ...... 32

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ABBREVIATIONS 1. ARR Aggregate Revenue Requirement 2. DGVCL Dakshin Gujarat Vij Company Limited 3. FPPPA Fuel and Power Purchase Price Adjustment 4. FY Financial Year 5. GEB Erstwhile Gujarat Electricity Board 6. GERC Gujarat Electricity Regulatory Commission GERC MYT 7. GERC (Multi Year Tariff) Regulations, 2016 Regulations, 2016 8. GETCO Gujarat Energy Transmission Corporation Limited 9. GoG Government of Gujarat 10. GoI Government of India 11. GSECL Gujarat State Electricity Corporation Limited 12. GUVNL Gujarat Urja Vikas Nigam Limited 13. kV Kilo Volt 14. kVA Kilo Volt Ampere 15. kVAh Kilo Volt Ampere Hour 16. kWh Kilo Watt Hour 17. MCLR Marginal Cost of Funds based Lending Rate 18. MGVCL Madhya Gujarat Vij Company Limited 19. MTR Mid-Term Review 20. MU Million Units (Million kWh) 21. MVA Mega Volt Ampere 22. MW Mega Watt 23. MYT Multi Year Tariff FY 2016-17, FY 2017-18, FY 2018-19, FY 2019-20 & FY 2020- 24. MYT Control Period 21 25. O&M Operation & Maintenance 26. PGVCL Paschim Gujarat Vij Company Limited 27. UGVCL Uttar Gujarat Vij Company Limited

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SECTION 1. INTRODUCTION

1.1. PREAMBLE

1.1.1. This section presents the background and reasons for filing this Petition.

1.2. INTRODUCTION

1.2.1 The Government of Gujarat (hereinafter referred to as “GoG”) notified the Gujarat Electricity Industry (Reorganization and Regulation) Act 2003 (herein after called as “Act”) in May 2003 for the reorganization of the entire power sector in the State of Gujarat.

1.2.2 Pursuant to the above, Government of Gujarat in their letter vide GO / 19th August 2003 had directed GEB to form four Distribution Companies (Discoms) based on geographical location of the circles. Accordingly the four distribution companies had been incorporated with the Registrar of Companies (RoC) on September 15th, 2003. Paschim Gujarat Vij Company Limited (PGVCL) is one of the distribution companies engaged in distribution of electricity in the south zone area of Gujarat.

1.2.3 The Paschim Gujarat Vij Co. Ltd obtained its Certificate of Commencement of Business on the 15th October, 2003. However, the company did not commence its commercial operations during the financial year ending 31st March, 2005. The Company has started its commercial function w.e.f. 1st April 2005.

1.2.4 The Gujarat Electricity Regulatory Commission (hereinafter referred to as “GERC” or “the Hon’ble Commission”), an independent statutory body constituted under the provisions of the Electricity Regulatory Commissions (ERC) Act, 1998 and is currently under purview of the Electricity Act, 2003. GERC is vested with the authority of regulating the power sector in the State inter alia including determination of Tariff for electricity consumers.

1.2.5 The Hon’ble Commission notified the Gujarat Electricity Regulatory Commission (Multi-Year Tariff) Regulations, 2016 (“ MYT Regulations, 2016”) on 29th March 2016 and shall be applicable for determination of tariff in all cases covered under the regulations from 1st April, 2016 onwards till 31st March 2020.

1.2.6 The Hon’ble Commission issued Order in Case No. 1625 of 2016 dated 31st March 2017 for Truing up of FY 2015-16, approval of final ARR for FY 2016-17 and approval of Multi-Year ARR for FY 2016-17 to FY 2020-21 and determination of Tariff for FY 2017- 18. Subsequently, the Hon’ble Commission issued Order in Case No. 1702 of 2018 dated 31st March 2018 for Truing up of FY 2016-17 and determination of Tariff for FY 2018-19. The Hon’ble Commission also issued Order in Case No.1762 of 2018 dated 24th April 2019 for Truing up of FY 2017-18 and determination of Tariff for FY 2019-20. The Hon’ble Commission has also issued Order in Case No. 1842 of 2019 dated 31st March 2020 for Truing up of FY 2018-19 and determination of Tariff for FY 2020-21.

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1.3. FILING OF TRUE-UP PETITION FOR FY 2019-20

1.4.1 The Hon’ble Commission has issued MYT Order in Case No. 1625 of 2016 dated 31st March, 2017 for Truing up of FY 2015-16, approval of final ARR for FY 2016-17 and approval of Multi-Year ARR for FY 2016-17 to FY 2020-21 and determination of Tariff for FY 2017-18. Subsequently, the Hon’ble Commission also issued MTR Order in Case No.1762 of 2018 dated 24th April, 2019 for Truing up of FY 2017-18 and determination of Tariff for FY 2019-20.

1.4.2 As the FY 2019-20 is over and annual accounts of PGVCL are also audited, PGVCL is filing its Petition for True-up of FY 2019-20 in accordance with MYT Regulations, 2016, to the Hon’ble Commission for its approval.

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SECTION 2. EXECUTIVE SUMMARY

2.1. PREAMBLE

2.1.1. This section highlights the summary of the Petition for True Up for FY 2019-20.

2.2. TRUE UP OF FY 2019-20

2.2.1 PGVCL has worked out its actual Aggregate Revenue Requirement (ARR) for FY 2019- 20 based on the audited accounts and the principles adopted by the Hon’ble Commission in its previous Orders.

2.2.2 The actual expenses have been compared against those approved for FY 2019-20 in the MTR of ARR for FY 2019-20 to FY 2020-21 Order dated 24th April, 2019. The detailed comparison of various cost components with the values approved by the Hon’ble Commission has been presented in the next Chapter on True up of FY 2019- 20. A summary of the actual ARR for Truing-up of FY 2019-20 compared with the approved ARR for FY 2019-20 is presented in the table given below:

TABLE 1 : TRUE UP FOR FY 2019-20 Rs in Crores

FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual)

1 Cost of Power Purchase 14,573.28 15,447.77 (874.49) 2 Operation & Maintenance Expenses 1,099.71 1,201.03 (101.32) 2.1 Employee Cost 1,004.74 1,098.41 (93.67) 2.2 Repair & Maintenance 165.09 176.89 (11.80) 2.3 Administration & General Charges 177.35 182.01 (4.66) 2.4 Other Expenses Capitalised (247.47) (256.28) 8.81 3 Depreciation 712.43 848.34 (135.91) 4 Interest & Finance Charges 444.62 442.34 2.28 5 Interest on Working Capital - - - 6 Provision for Bad Debts 2.15 74.22 (72.07)

7 Sub-Total [1 to 6] 16,832.19 18,013.71 (1,181.52)

8 Return on Equity 577.65 588.11 (10.46) 9 Provision for Tax / Tax Paid 28.71 5.32 23.39

10 Total Expenditure (7 to 9) 17,438.55 18,607.14 (1,168.59) 11 Less: Non-Tariff Income 258.58 323.75 (65.17) 12 Add: DSM Expenses 2.50 Aggregate Revenue Requirement (10 - 13 17,182.47 18,283.39 (1,100.92) 11)

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2.2.3 In line with the provisions of the MYT Regulations, 2016, PGVCL has computed the gains and losses on account of controllable and uncontrollable parameters and its proposed sharing mechanism.

2.2.4 The cost components have been segregated into controllable and uncontrollable factors as per the methodology outlined in Regulation 22 of the MYT Regulations, 2016. Summary of the difference allocation to controllable & Uncontrollable factors is outlined as per the table below:

TABLE 2 : SUMMARY OF CONTROLLABLE AND UNCONTROLLABLE FACTORS FOR FY 2019-20 Rs in Crores Gain/(Loss) Gain/(Loss) FY 2019-20 FY 2019-20 due to due to Sr. No. Particulars (Approved) (Actual) Controllable Uncontrollabl Factors e Factors 1 Cost of Power Purchase 14,573.28 15,447.77 (151.22) (723.27) 2 Operation & Maintenance Expenses 1,099.71 1,201.03 21.18 (122.50) 2.1 Employee Cost 1,004.74 1,098.41 25.84 (119.51) 2.2 Repair & Maintenance 165.09 176.89 - (11.80) 2.3 Administration & General Charges 177.35 182.01 (4.66) - 2.4 Other Expenses Capitalised (247.47) (256.28) - 8.81 3 Depreciation 712.43 848.34 - (135.91) 4 Interest & Finance Charges 444.62 442.34 - 2.28 5 Interest on Working Capital - - - - 6 Provision for Bad Debts 2.15 74.22 (72.07) - 7 Return on Equity 577.65 588.11 - (10.46) 8 Provision for Tax / Tax Paid 28.71 5.32 - 23.39 9 ARR (1 to 8) 17,438.55 18,607.14 (202.11) (966.47) 10 Non - Tariff Income 258.58 323.75 - (65.17) 11 Total ARR (9-10) 17,179.97 18,283.39 (202.11) (901.31)

2.2.1. As per the mechanism specified in the MYT Regulations, 2016, PGVCL proposes to pass on a sum of 1/3rd of total gain/(loss) on account of controllable factors i.e. Rs. (67.37) Crores and total gain/(loss) on account of uncontrollable factor i.e. Rs. (901.31) Crores to the consumers. Further, the revenue gap/ (surplus) approved by the Hon’ble Commission on True up of FY 2017-18 of Rs. (295.40) Crores is also considered. Adjusting these to the net Aggregate Revenue Requirement, PGVCL has arrived at the Revised Aggregate Revenue Requirement for FY 2019-20 at Rs. 17,855.75 Crores.

2.2.2. This revised Aggregate Revenue Requirement is compared against the revised income under various heads including Revenue from Existing Tariff of Rs. 16,780 Crores, Other Consumer related Income of Rs. 248.66 Crores, Agriculture Subsidies of Rs. 395.42 Crores and GUVNL profit allocation of Rs. 36.09 Crores, summing up to a Total Revenue of Rs. 17,460.17 Crores. Accordingly, total Revenue Gap/(Surplus) of PGVCL for FY 2019-20 after treatment of gain/(loss) due to controllable / uncontrollable factors is computed at Rs. 395.58 Crores as shown in the table below:

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TABLE 3 : REVENUE GAP FOR FY 2019-20 Rs in Crores FY 2019-20 Sr. No. Particulars (Actual) Aggregate Revenue Requirement 1 17,182.47 originally approved for FY 2019-20 2 Add: Gap/(Surplus) of FY 2017-18 (295.40) Gain / (Loss) on account of 3 Uncontrollable factor to be passed on to (901.31) Consumer Gain / (Loss) on account of Controllable 4 factor to be passed on to Consumer (67.37) (1/3rd of Total Gain / Loss) Revised ARR for FY 2019-20 5 17,855.75 (1 + 2 - 3 - 4)

6 Revenue from Sale of Power 16,780.00 7 Other Income (Consumer related) 248.66 Total Revenue excluding Subsidy 8 17,028.66 (6 + 7) 9 Agriculture Subsidy 395.42 10 GUVNL Profit / (Loss) Allocation 36.09 Total Revenue including Subsidy 11 17,460.17 (8 + 9 + 10) Revised Gap after treating gains/(losses) 12 due to Controllable/ Uncontrollable 395.58

factors (5 - 11)

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SECTION 3. TRUE UP FOR FY 2019-20

3.1. PREAMBLE

3.1.1. This section outlines the performance of PGVCL for FY 2019-20. In line with the provisions of the MYT Regulations, 2016, PGVCL hereby submits the True-Up Petition comparing the actual performance of PGVCL during FY 2019-20 with the forecast approved by the Hon’ble Commission vide MTR Order dated 24th April, 2019.

3.2. PRINCIPLES FOR TRUE UP FOR FY 2019-20

3.2.1. As per MYT Regulations, 2016, the Hon’ble Commission is required to undertake the True-Up of the licensees for FY 2019-20 based on the comparison of the actual performance of the past year with the approved estimates for such year. Section 21.1 of the MYT Regulations, 2016 is read as below:

“the Generating Company or Transmission Licensee or SLDC or Distribution Licensee shall be subject to truing up of expenses and revenue during the Control Period in accordance with these Regulations.”

3.2.2. In line with the provisions of MYT Regulations, 2016, PGVCL has filed this Petition for True-Up for the year FY 2019-20. Information provided in the True-Up for FY 2019-20 is on the basis of audited actual performance and considering principles adopted by the Hon’ble Commission in its previous Orders. The actual performance has been compared with the approved numbers as per the MTR Order dated 24th April, 2019.

3.2.3. Accordingly, actual data for revised Aggregate Revenue Requirement, revenue and gap for FY 2019-20 are given in the following paragraphs of this chapter.

3.2.4. For the purpose of True-Up all the expense heads have been categorized into Controllable and Uncontrollable factors. A head-wise comparison has been made between the values approved by the Hon’ble Commission and the actual values for various expenditures for FY 2019-20.

3.3. CATEGORY WISE SALES

3.3.1. The actual category wise sales for FY 2019-20 were 27,622.31 MUs as against the approved sales of 29,668.17 MUs. The table below highlights the comparison of actual category wise sales of PGVCL against that approved by the Hon’ble Commission vide its Tariff Order.

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TABLE 4 : CATEGORY-WISE SALES Sr. No. Particulars Sales(MUs) FY 2019-20 FY 2019-20 (Actual) (Approved) A LT Consumers 1 RGP 3,995.53 3,791.39 2 GLP 135.79 122.69 3 Non-RGP & LTMD 3,743.75 3,672.00 4 Public Water Works 875.55 624.52 5 Agriculture - Metered 3,600.83 2,695.07 6 Agriculture - Unmetered 4,570.16 4,677.80 7 Street Lighting 81.00 73.36 LT Total (A) 17,002.61 15,656.83 B HT Consumers 8 Industrial HT 12,665.56 11,965.48 9 Licensee HT Total (A) 12,665.56 11,965.48 Grand Total (A + B) 29,668.17 27,622.31

3.4. DISTRIBUTION LOSSES 3.4.1. In FY 2019-20, the actual distribution losses were 17.85% as against the approved level of 17.00%. The table below highlights the comparison of actual distribution losses of PGVCL against that approved by the Hon’ble Commission vide its Tariff Order.

TABLE 5 : DISTRIBUTION LOSSES FY 2019-20 Sr. No. Particulars FY 2019-20 (Actual) (Approved) 1 Distribution Losses 17.00% 17.85%

3.4.2. The MYT Regulations, 2016 categorise the Distribution Losses as a controllable factor and accordingly any gain or loss on account of this would be shared with the consumers as per the provisions of the regulations.

3.4.3. The Hon’ble Commission had approved the distribution loss levels for PGVCL at 17.00% for FY 2019-20 and the actual loss achieved were 17.85% for FY 2019-20. PGVCL shall put more efforts to lower distribution losses.

3.4.4. Since PGVCL has losses little higher than those approved by the Hon’ble Commission, its effect has been discussed in the section relating to power purchase and the gains and losses has been captured there itself.

3.5. ENERGY REQUIREMENT AND ENERGY BALANCE

3.5.1. The gross energy requirement of PGVCL is as follows given in the table below:

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TABLE 6 : ENERGY REQUIREMENT AND ENERGY BALANCE Energy Balance FY 2019-20 FY 2019-20 S.No. Particulars Unit Approved Actual 1 Energy Sales MUs 29,668.17 27,622.31 2 Distribution Losses MUs 6,076.61 6,003.46 % 17.00% 17.85% 3 Energy Requirement MUs 35,744.78 33,625.77 Less: Local Power Purchase by Discom (Net of sale 4 MUs 165.68 to KPT) 5 Power Purchase at T<>D periphery from GUVNL MUs 35,745 33,460 6 Transmission Losses MUs 1,431.00 1,294.08 % 3.85% 3.72% 7 Total Energy to be input to Transmission System MUs 37,175.78 34,754 8 Pooled Losses in PGCIL System MUs 581.10 412.45 9 Add: Local Power Purchase by Discom MUs 165.68 10 Total Energy Requirement MUs 37,756.88 35,332.30

3.5.2. The gross energy requirement for sale to the consumers in FY 2019-20 is 35,332.30 MUs as compared to 37,756.88 MUs as approved by the Hon’ble Commission.

3.6. POWER PURCHASE COST

3.6.1. The company has been currently allocated share of generation capacities as per the scheme worked out by GUVNL. In order to minimize power purchase cost, GUVNL adopts the Merit Order Despatch principles for despatching power from the generating stations based on the demand and accordingly power gets allocated to PGVCL.

3.6.2. The actual power purchase from GUVNL is different from allocation because the demand from PGVCL is not constant and it varies from time to time.

3.6.3. The total power purchase cost of PGVCL for FY 2019-20 consists of the basic power purchase cost, transmission charges payable to GETCO and PGCIL, SLDC charges and the DISCOM’s share of GUVNL cost. Based on the same, the comparison of the approved and the actual cost of power purchase are as shown below:

TABLE 7: NET POWER PURCHASE COST Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars (Approved) (Actual) A Cost 1 Power Purchased from GUVNL 15,472.43 2 Power purchase from Windfarm 31.15 3 Power Purchased from Solar 26.33 4 DSM Charges 5 SLDC Charges 4.70 Total Cost 15,534.61 B Income 1 Sale of Power to GUVNL 38.32 2 DSM charges income 48.52

Net Power Purchase Cost 14,573.28 15,447.77

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3.6.4. The variation in the approved and the actual power purchase expenses is on account of various reasons including change in approved cost of power, change in quantum of power purchased allowed, consequent changes in the transmission charges payable and change in cost allocation to GUVNL.

3.6.5. The quantum of power purchase depends upon the sales during the year as well as the losses in the system. The actual distribution losses in PGVCL distribution network have been little higher than the approved level but the sales are lower than that approved by the Hon’ble Commission and hence, the quantum of power purchased was lower than the approved quantum of power required.

3.6.6. As per the MYT Regulations, 2016, the Hon’ble Commission has categorised the variation in the price of fuel and/or price of power purchase according to the FPPPA formula approved by the Hon’ble Commission as an uncontrollable factor. Further, the Hon’ble 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 the above 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 Hon’ble Commission.

3.6.7. In addition to the above, there is an incidence of higher power purchase cost on account of the higher Distribution losses as compared to the losses approved by the Hon’ble Commission. These loss has resulted in higher power purchase expenses as the quantum of power required to be purchased to meet the same level of demand would be higher hence resulting in the loss as explained below:

TABLE 8 : GAIN/ (LOSS) ON ACCOUNT OF DISTRIBUTION LOSSES FOR FY 2019-20

Gain/(Loss) due to Distribution Losses FY 2019-20 FY 2019-20 (with Approved (with Actual S.No. Particulars Unit Distribution Distribution Losses) Losses) 1 Energy Sales MUs 27,622.31 27,622.31 2 Distribution Losses MUs 5,657.58 6,003.46 % 17.00% 17.85% 3 Energy Requirement MUs 33,279.89 33,625.77 4 Saving due to Distribution Losses MUs (345.87) 5 Average Power Purchase Cost Rs./Unit 4.37 6 Gain/(Loss) due to Dist. Losses (151.22)

3.6.8. As can be seen from the above, the total gain/ (loss) on account of higher distribution losses as compared to approved is Rs. (151.22) Crores. This gain is categorised as on account of controllable factors and the appropriate treatment is given below:

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TABLE 9 : GAINS / (LOSS) - POWER PURCHASE EXPENSES Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Total Power Purchase Cost 14,573.28 15,447.77 (151.22) (723.27)

3.6.9. Thus, as can be seen from the above table, the power purchase gain/(loss) due to controllable & uncontrollable factors are Rs. (151.22) Crores and Rs. (723.27) Crores respectively which would have to be passed on to the consumers as per the methodology approved by the Hon’ble Commission.

3.7. CAPITAL EXPENDITURE

3.7.1. Capital expenditure incurred by PGVCL in FY 2019-20 was Rs. 1766.16 Crores. The actual capital expenditure by PGVCL during the FY 2019-20 is lower than that approved by the Hon’ble Commission. The scheme-wise capital expenditure incurred in FY 2019-20 against approved by the Hon’ble Commission is as shown below:

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TABLE 10 : CAPITAL EXPENDITURE Rs in Crores Particulars FY 2019-20 FY 2019-20 Deviation (Approved) (Actual) A Distribution Schemes - Normal Development Scheme 348.60 336.86 11.74 System Improvement Scheme 100.00 166.75 (66.75) Electrification of hutments 7.00 3.07 3.93 Scheme for meters including installation 80.00 38.94 of SMART Meters 41.06 Total 535.60 547.73 (12.13) B Rural Electrification Schemes - Special Component plan 1.50 2.93 (1.43) RE Normal + Tatkal + Dark Zone 935.00 997.69 (62.69) Total 936.50 1,000.62 (64.12) C Non Plan Schemes - SCADA/DMS - 1.17 (1.17) Total - 1.17 (1.17) D Other New Schemes - - Civil work 10.00 - 10.00 Shunt Capacitor 10.00 - 10.00 Fencing to Distribution Transformer 15.00 - 15.00 Aerial Bunch Conductors 1.00 - 1.00 HVDS 100.00 59.59 40.41

Under Ground System at Pilgim Places 75.00 0.12 74.88 like Dwarka, Somnath, Bhavnath (Junagadh) etc. and important GIDC area SKJY 50.00 86.22 (36.22) Marine Cable for Shiyalbet - - - IPDS - 5.46 (5.46) DDUGJY - 6.71 (6.71) Solar Ag Pump - - - FPI 1.00 - 1.00 DISS 10.00 17.17 (7.17) Others schemes (General Schemes) - - - Smart Village - 0.05 (0.05) Coastal area scheme 40.00 41.31 (1.31) Total 312.00 216.64 95.36 Capital Expenditure Total 1,784.10 1,766.16 17.94

3.7.2. Scheme wise deviation in capital expenditure is explained as under:

• Normal Development: Under the head Normal Development Scheme, generally expenses are incurred to meet with the Supply Obligation which is mainly based on the numbers of applications received. Therefore, during the FY 2019-20, company had to incur Rs. 336.80 Crore against approved Rs. 348.60 Crore. Hon’ble Commission is requested to approve it.

• System Improvement: Under the head System Improvement, PGVCL carries out renovation/replacement of old Distribution line, bifurcation of feeder, installation/augmentation of Distribution Transformer etc. System Improvement

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is carried out on requirement basis with the objective to improve reliability of power supply and also to reduce distribution loss. Company incurred Rs. 166.75 Crore against approved Rs. 100 Crore. Hon’ble Commission is requested to approve it.

• Scheme for meters including installation of SMART Meters: The scheme involves replacement of meters at exiting consumers’ premises by static/ electronics meters and also installation of meters at Distribution Transformer level. Under the scheme, PGVCL incurred expenditure of Rs. 41.06 Crore during FY 2019-20. Hon’ble Commission is requested to approve the same.

• RE Normal+Tatkal+Dark Zone: Under the head RE Schemes, Company releases Agriculture Category connections. Following the directive of Hon’ble Commission, Company has maximised the targets for releasing the Connections of Agriculture category. Accordingly, during FY 2019-20 Company released more than 85000 Agriculture connections during the year at the cost of Rs. 997.69 Crore against approved Rs. 935 Crore.

Following the policy framed by State Government, Company has started releasing connection in the Dark Zone area too from the year 2013-14. The scheme involves replacement of meters at exiting consumers’ premises by static/ electronics meters and also installation of meters at Distribution Transformer level. Under the scheme, PGVCL incurred expenditure of Rs.42.50 Crore during FY 2018-19. Hon’ble Commission is requested to approve the same.

• SCADA/DMS: The objective of reducing Aggregate Technical and Commercial (AT&C) losses in the project areas can be achieved by plugging pilferage points, 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. The real time monitoring & control of the distribution system through state-of-the art SCADA/DMS system encompassing all distribution substations & 11 KV network would help in achieving this objective of R-APDRP. For deriving maximum benefits it is essential that necessary upgradation of distribution S/S & 11kV network shall be carried out to meet the SCADA/DMS requirements. SCADA is to be implemented through SCADA Implementation Agency (SIA). The scheme involves replacement of meters at exiting consumers’ premises by static/ electronics meters and also installation of meters at Distribution Transformer level. Under the scheme, PGVCL incurred expenditure of Rs.42.50 Crore during FY 2018-19. Hon’ble Commission is requested to approve the same.

• High Voltage Distribution System (HVDS): 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 in Technical loss and associated commercial loss company has proposed to shift over on High Voltage Distribution System by erecting small capacity Transformer matching with the connected load of individual consumer or very small group of consumers in phased manner.

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During the year company has incurred Rs. 59.59 Crore as against approved Rs. 100 Crore. Hon’ble Commission is requested to approve the same.

• Coastal Area Scheme: PGVCL covers largest costal area of the state. Majority of the Distribution network of the Company is “Overhead” type. “Overhead” network is highly susceptible to environmental changes in general and particularly in coastal area. To provide better quality power supply in the coastal belt, Company undertakes various activities like renovation of Distribution network, Distribution Transformer review, providing Aerial Bunch Conductor, conversion of LT Distribution network into High Voltage Distribution System etc. Scope of work is planned depending on time to time requirement and exigency of work. Accordingly, Company has spent Rs. 41.31 Crore during FY 2019-20 against approved Rs. 40 Crore. Hon’ble Commission is requested to approve the same.

• Underground Network: Government of India has notified “Integrated Power Development System”. One of the main components of the scheme is to convert existing Overhead System to Underground System. Therefore, the earlier proposed “Underground” schemes has been now implemented in the limited area like Pilgrim places etc. and accordingly Company spent Rs. 0.12 Crore under the scheme during FY 2019-20. Hon’ble Commission is requested to approve the same.

• Integrated Power Development Scheme (IPDS): Scheme is applicable in the town/ urban areas having population 5000 and more as per Census 2011. Scheme involves strengthening of Sub-transmission and Distribution network in urban areas including provisioning of solar panels on Govt. buildings including Net- metering, Metering of feeders / distribution transformers / consumers in urban areas and, IT enablement of distribution sector and strengthening of distribution network, etc. Under the scheme, Company spent Rs. 5.46 Crore during FY 2019- 20. Hon’ble Commission is requested to approve the same.

• Deen Dayal Upadhyay Gram Jyoti Yojna (DDUGJY): Scheme is applicable in the Rural areas of the Company. Scheme involves strengthening and augmentation of sub-transmission & distribution to ensure reliable and quality power supply in rural areas, Conversion of existing LV network to HV network, improving consumer level metering system, installation of meter at distribution transformers for proper energy accounting, identifying high loss pockets etc. Under the scheme, Company spent Rs. 6.71 Crore during FY 2019-20. Hon’ble Commission is requested to approve the same.

• Sardar Krushi Jyoti Yojna (SKJY): Under the head Sardar Krushi Jyot Yojna (SKJY), PGVCL carries out replacement, strengthening, renovation etc. of Agriculture Dominant Distribution network under the financial assistance from the State Government. Main objective of the scheme is to improve reliability of power supply and also to reduce distribution loss. Company incurred Rs. 86.22 Crore against approved Rs. 50.00 Crore. Hon’ble Commission is requested to approve the same.

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• DISS: Under this scheme, PGVCL shifts the network obstructing to Local bodies, urban authorities in their development activities, road widening etc. Under the scheme, Company spent Rs. 17.17 Crore during FY 2019-20 against approved Rs. 10.00 Crore. Hon’ble Commission is requested to approve the same.

3.8. FUNDING OF CAPITALISATION

3.8.1. 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 2019-20 is mentioned in the table below.

TABLE 11 : FUNDING OF CAPITALISATION Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 Capitalization 1,784.10 1,796.23 (12.13) 2 Less : Consumer Contribution 209.27 230.85 (21.58) 3 Grants 107.50 141.76 (34.26) 4 Balance CAPEX 1,467.33 1,423.62 43.71 5 Debt @ 70% 1,027.13 996.54 30.59 6 Equity @ 30% 440.20 427.09 13.11

3.9. FIXED COST FOR FY 2019-20

3.9.1. The fixed cost of PGVCL for FY 2019-20 has been determined in accordance with the MYT Regulations, 2016. As outlined under the regulations, the fixed cost for PGVCL has been determined under the following major heads:

• Operation and Maintenance Expenses • Depreciation • Interest and Finance Charges • Interest on Working Capital • Income Tax • Return on Equity 3.9.2. Net Annual Revenue Requirement of PGVCL has been computed after netting off expenses capitalised and Non-Tariff Income.

3.9.3. For the purpose of True-Up, all the heads mentioned above have been categorized into Controllable or Uncontrollable in line with provisions of MYT Regulations, 2016. A head wise comparison of cost has been made between the values approved by the Hon’ble Commission vide MTR Order dated 24th April, 2019 and the actual expenses of PGVCL in FY 2019-20.

3.10. OPERATION & MAINTENANCE EXPENSES

3.10.1. Operations and Maintenance (O&M) Expenses of PGVCL consists of the following

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elements:

• Employee Expenses • Repairs and Maintenance Expenses • Administrative and General Expenses 3.10.2. Employee expenses comprise of salaries, dearness allowance, bonus, terminal benefits in the form of pension & gratuity, leave encashment and staff welfare expenses.

3.10.3. Repairs and Maintenance expenses are incurred towards the day to day upkeep of the distribution network and form an integral part of the efforts towards reliable and quality power supply as also in the reduction of losses in the distribution system.

3.10.4. Administration & General expenses mainly comprise of rents, telephone and other communication expenses, professional charges, conveyance and travelling allowances, etc.

3.10.5. PGVCL is also required to include the expenses of the following items of the ARR into O&M expenses by the Hon’ble Commission:

• Other Debits • Extraordinary Items • Net Prior Period Expenses/(Income) • Other Expenses Capitalised 3.10.6. After the combination of all the above parameters for FY 2019-20, PGVCL’s actual O&M expenses were Rs. 1,201.03 Crores which is inclusive of Employee cost of Rs. 1098.41 Crores, Repair & Maintenance Charges of Rs. 176.89 Crores and Administration & General Expenses of Rs. 182.01 Crores along with other debits, extraordinary items and net prior period expense/ (income) as nil and other expenses capitalized against the approved O&M expense which is Rs. (256.28) Crores.

TABLE 12 : OPERATION & MAINTENANCE EXPENSES Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 Employee Cost 1,004.74 1,098.41 (93.67) 2 Repair & Maintenance 165.09 176.89 (11.80) 3 Administration & General Charges 177.35 182.01 (4.66) 4 Other Debits - - - 5 Extraordinary Items - - - 6 Net Prior Period Expenses / (Income) - - - 7 Other Expenses Capitalised (247.47) (256.28) 8.81

8 Operation & Maintenance Expenses 1,099.71 1,201.03 (101.32)

3.10.7. Comparison of actual O&M charges during FY 2019-20 with the value approved by the Hon’ble Commission reflects gain/(loss) of Rs. 21.18 Crores on account of controllable factors and gain/ (loss) of Rs. (122.50) Crores on account of uncontrollable factors to

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PGVCL.

TABLE 13 : TREATMENT OF OPERATION & MAINTENANCE EXPENSES

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Employee Expenses 1,004.74 1,098.41 25.84 (119.51) 2 Repair & Maintenance Cost 165.09 176.89 - (11.80) 3 Administration & General Charges 177.35 182.01 (4.66) - 4 Other Debits - - - - 5 Extraordinary Items - - - - 6 Net Prior Period Expenses / (Income) - - - - 7 Other Expenses Capitalised (247.47) (256.28) - 8.81 8 Total O&M Expenses 1,099.71 1,201.03 21.18 (122.50)

Employee Cost

3.10.8. The employee cost incurred by the company is purely on the basis of the guidelines issued by competent authorities like the state government. The actual employee cost as per profit & loss account for FY 2019-20 were Rs. 978.90 Crores which excludes the provision made towards 7th Pay Commission of Rs. 68.82 Crore but includes Rs. 90.97 Crore of Re-measurement of defined benefit plans. The Hon’ble Commission in the MTR Order dated 24th April, 2019 and True up Order of FY 2018-19 dated 31st March, 2020 had not approved the provision made for respective years towards 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 Hon’ble Commission would consider such claims, which would be accounted for during the true up of annual account of the respective year as uncontrollable factor.

3.10.9. It is to note that employee cost as per 7th Pay Commission was paid to the employees of PGVCL during FY 2019-20. The Hon’ble Commission has allowed partial impact of 7th Pay Commission while approving employee cost projection for FY 2019-20 in its MTR Order in Case No. 1762 of 2018 dated 24th April, 2019. The relevant part of the same is reproduced here below:

“5.12.1 Operation and Maintenance (O&M) Expenses

…

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 15.04.2019 confirmed that during FY 2017-18, Technical category 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 Paschim Gujarat Vij Company Limited Page 21

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2019-20 and FY 2020-21. The Commission shall consider actual employee expenses as uncontrollable to the extent of actual pay out on account of revision in salaries and allowances while truing up of FY 2019-20 and FY 2020-21.

…”

3.10.10. It is to note that PGVCL has also paid arrears payment from its provision and cost has not reflected in P&L accounts. It is also to note that provisions made from FY 2015-16 to FY 2019-20 are not approved by the Hon’ble Commission. To work out actual pay out on account of 7th Pay Commission impact, 7th Pay Commission provision as on 31st March, 2020 is reduced from various provisions made for 7th Pay Commission (which was not allowed by the Hon’ble Commission) is reduced to work out uncontrollable employee expense during FY 2019-20. The working of the same is as shown below:

TABLE 14 : CALCULATION OF UNCONTROLLABLE EMPLOYEE COST DURING FY 2019-20 Sr. No. Particulars Amount 7th Pay Provision not considered while approval of Employee Cost by the Hon'ble Commisison 1 FY 2015-16 29.77 2 FY 2016-17 126.95 3 FY 2017-18 86.62 4 FY 2018-19 66.89 5 FY 2019-20 68.82 A Total (1 to 5) 379.05 B 7th Pay Provision as on 31st March, 2020 259.54

C Actual Arrears Pay out to employees from Cumulative 119.51 Provisions which has not reflected in Employee Cost (P&L) (A - B)

3.10.11. Hence, total employee cost of PGVCL for FY 2019-20 is Rs. 1098.41 Crore (Rs. 978.90 Crore as per employee cost in P&L + Rs. 119.51 Crore as per arrears payment from disallowed provisions). Accordingly, PGVCL has estimated a gain/ (loss) of Rs. 25.84 Crores on account of controllable employee cost and Rs. (119.51) Crores of actual payment towards 7th Pay Commission towards the uncontrollable employee cost.

3.10.12. The summary of the comparison of the actual employee expenses for FY 2019-20 vis- à-vis the expenses approved by the Hon’ble Commission is given in the table below:

TABLE 15 : EMPLOYEE COST FOR FY 2019-20

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Employee Cost 1,004.74 1,098.41 25.84 (119.51)

Repair & Maintenance Cost

3.10.13. Repair and Maintenance expenditure is dependent on various factors. The assets of PGVCL are old and require regular maintenance to ensure uninterrupted operations.

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PGVCL has been trying its best to ensure uninterrupted operations of the system and accordingly has been undertaking necessary expenditure for R&M activities. The MYT Regulations, 2016 provides for R&M expenditure as a controllable expenditure.

3.10.14. However, during the year there was huge rainfall and devastating cyclones “VAYU”, “MAHA” etc were struck within the Company area and damaged the network of the Company. Due to cyclones, 786.516 Kms HT Line, 140.64 Kms LT Line , 1547 nos of transformers and 18011 nos of Poles were damaged among others, which has resulted in additional expenditure under R&M. Therefore, PGVCL requests to Hon’ble Commission to consider the additional expenditure as “Uncontrollable”.

3.10.15. The actual R&M cost for FY 2019-20 is Rs. 176.89 Crores. Accordingly, on the basis of comparison of actual R&M expenditure of PGVCL with the values approved by the Hon’ble Commission, there is a gain/(loss) of Rs. (11.80) Crores as indicated in the table below:

TABLE 16 : REPAIR & MAINTENANCE COST FOR FY 2019-20

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Repair & Maintenance Cost 165.09 176.89 (11.80)

Administration & General Expenses 3.10.16. The actual A&G expense for FY 2019-20 were Rs. 182.01 Crores. As per the provisions of the MYT Regulations, 2016, A&G expenses are categorised as controllable expenses and accordingly, the comparison of value approved by the Hon’ble Commission with the actual A&G expenses of PGVCL shows a gain/(loss) of Rs. (4.66) Crores as highlighted in the table below:

TABLE 17 : ADMINISTRATION & GENERAL EXPENSES FOR FY 2019-20

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Administration & General Charges 177.35 182.01 (4.66)

Other Expenses Capitalised

3.10.17. The Other expenses including expenses capitalised, etc. are beyond the control of PGVCL and therefore are considered as uncontrollable.

TABLE 18: OTHER EXPENSES CAPITALISED

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Other Expenses Capitalised (247.47) (256.28) 8.81

3.10.18. The comparison of actual O&M expenses by PGVCL during FY 2019-20 with the value

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approved by the Hon’ble Commission shows a net gain/ (loss) on account of controllable factors of Rs. 21.18 Crores and gain/ (loss) of Rs. (122.50) Crores on account of uncontrollable factors to PGVCL.

3.11. DEPRECIATION

3.11.1. PGVCL had been charging depreciation on fixed assets of the Company, on the useful life of the assets at rates prescribed under Schedule XIV to the Companies Act, 1956. The Company being engaged in electricity distribution business is covered under the Electricity Act, 2003 and provisions of the Electricity Act supersede the provisions of the Companies Act, 2013.

3.11.2. 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:

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”

3.11.3. Accordingly, PGVCL has calculated the Depreciation for FY 2019-20 in accordance with the provisions of the MYT Regulations, 2016 and the aforementioned directives of the Hon’ble Commission.

3.11.4. The actual and approved depreciation for FY 2019-20 is as shown below:

TABLE 19 : FIXED ASSET AND DEPRECIATION FOR FY 2019-20 Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 Gross Block in Beginning of the year 16,877.44 17,100.97 2 Additions during the Year (Net) 1,784.10 1,796.23 3 Closing GFA 18,661.54 18,897.20 4 Average GFA 17,769.49 17,999.09 5 Depreciation for the Year 712.43 848.34 (135.91) 6 Average Rate of Depreciation 4.01% 4.71%

3.11.5. The actual depreciation for FY 2019-20 as against the value approved by the Hon’ble Commission results into a uncontrollable gain/(loss) of Rs. (135.91) Crores as indicated below:

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TABLE 20 : TREATMENT OF DEPRECIATION

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Depreciation 712.43 848.34 - (135.91)

3.12. INTEREST & FINANCIAL CHARGES

3.12.1. For assessing actual Interest charges on Loans in FY 2019-20, PGVCL has considered the opening balance of loans for FY 2019-20 same as the closing loan approved by the Hon’ble Commission for FY 2018-19 in the True up Order dated 31st March, 2020. The loan addition in FY 2019-20 is computed at Rs. 996.54 Crores which consists of loans for funding the capital expenditure.

3.12.2. In line with the approach adopted by the Hon’ble Commission and as prescribed by MYT Regulations, 2016 repayment during the year has been considered equal to the depreciation for the financial year.

3.12.3. Based on the provisions of the MYT Regulations, 2016, the weighted average rate of interest during the year for Truing up of FY 2019-20 is 9.71 % as against 9.69 % as approved by the Hon’ble Commission.

3.12.4. PGVCL has also claimed interest on security deposits of Rs. 126.41 Crore paid to the consumers during FY 2019-20

3.12.5. PGVCL submits that it has been allocated some guarantees of Govt. of Gujarat, for which it is required to pay the guarantee charges. These are the legacy loans which have come from the erstwhile GEB. These charges are, thus, beyond control of PGVCL and hence are required to be considered in the total financial cost.

3.12.6. The total Interest & Financial charges for FY 2019-20 computed by PGVCL as against that approved by the Hon’ble Commission is as shown below:

TABLE 21 : INTEREST & FINANCE CHARGES FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 Opening Loans 3,104.83 3,158.88 2 Loan Additions during the Year 1,027.13 996.54 3 Repayment during the Year 712.43 848.34 4 Closing Loans 3,419.53 3,307.08 5 Average Loans 3,262.18 3,232.98

6 Interest on Loan 315.99 313.92 7 Interest in Security Deposit 126.02 126.41 8 Other Bank Charges 2.62 2.01 9 Total Interest & Financial Charges 444.62 442.34 10 Weighted Average Rate of Interest 9.69% 9.71%

3.12.7. The MYT Regulations, 2016 categorise the interest and finance charges as uncontrollable expenses. Any changes on account of changes in applicable interest

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rates should be considered as uncontrollable. Accordingly, PGVCL has considered deviation in the actual vis-à-vis the approved expenses towards interest and finance charges as uncontrollable. The same has been provided in the table given below:

TABLE 22 : TREATMENT OF INTEREST & FINANCE CHARGES

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Interest & Finance Charges 444.62 442.34 2.28

3.13. INTEREST ON WORKING CAPITAL

3.13.1. The interest on working capital has been calculated on the basis of the provisions of the MYT Regulations, 2016.

3.13.2. In line with the First Amendment to the MYT Regulations, 2016 dated 2nd December, 2016, the rate of interest considered is the weighted average of the 1-year MCLR of the State Bank of India during the year plus 250 basis points. This rate works out to 10.66%. Also, as per these Regulations, one month of receivables are to be considered for calculation of interest on working capital. Also amount held as security deposit from consumers under clause (a) and clause (b) of sub-section (1) of Section 47 of the Electricity Act 2003 except the security deposit held in the form of Bank Guarantees is to be deducted from it. Since the interest on working capital for FY 2019-20 incurred by PGVCL is nil, PGVCL has not claimed interest on working capital for FY 2019-20 as shown below:

TABLE 23 : INTEREST ON WORKING CAPITAL Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 O & M expenses 91.64 100.09 2 Maintenance Spares 168.77 171.01 3 Receivables 1,399.14 1,452.01 4 Amount held as security deposit from cons 2,016.26 2,112.48 5 Total Working Capital (356.71) (389.38) 6 Rate of Interest on Working Capital 10.65% 10.66%

7 Interest on Working Capital - - -

3.14. PROVISION FOR BAD DEBTS

3.14.1. The actual bad debts written off in FY 2019-20 are shown in the following table:

TABLE 24: BAD & DOUBTFUL DEBTS WRITTEN OFF Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 Provision for Bad and Doubtful Debts 2.15 74.22 (72.07)

3.14.2. A comparison of the actual value with the figure approved by the Hon’ble Commission

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for FY 2019-20 shows a gain/(loss) of (72.07) Crores on account of controllable factors as shown in the table below:

TABLE 25 : TREATMENT OF BAD & DOUBTFUL DEBTS

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Provision for Bad Debts 2.15 74.22 (72.07)

3.15. RETURN ON EQUITY

3.15.1. As per the MYT Regulations, 2016, a return @ 14% on the equity base is considered as reasonable and allowed by the Hon’ble Commission. Accordingly, PGVCL has computed the Return on Equity considering a rate of return at 14%.

3.15.2. For assessing actual return on equity for FY 2019-20, PGVCL has considered the opening balance of equity of FY 2019-20 as the closing balance of equity of FY 2018-19 approved by the Hon’ble Commission in the True up Order dated 31st March, 2020 and additions during the year as already discussed in the above paragraphs have been considered. The return on equity for FY 2019-20 is as shown below:

TABLE 26 : RETURN ON EQUITY Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 Opening Equity Capital 3,905.99 3,987.26 (81.27) 2 Equity Additions during the Year 440.20 427.09 13.11 3 Closing Equity 4,346.19 4,414.35 (68.16) - 4 Average Equity 4,126.09 4,200.80 (74.71) 5 Rate of Return on the Equity 14% 14% -

6 Return on Equity 577.65 588.11 (10.46)

3.15.3. A comparison of the actual Return on Equity for FY 2019-20 with the amount approved by the Hon’ble Commission shows a net uncontrollable gain/ (loss) as indicated below.

TABLE 27 : TREATMENT OF RETURN ON EQUITY

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Return on Equity 577.65 588.11 (10.46)

3.16. INCOME TAXES

3.16.1. The actual tax paid in FY 2019-20 was Rs. 5.32 Crores as against Rs. 28.71 Crores approved by the Hon’ble Commission as shown below:

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TABLE 28 : INCOME TAX Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual) 1 Income Tax 28.71 5.32 23.39

3.16.2. It is submitted that Income Tax being a statutory expense, any variation on this account is uncontrollable. Accordingly, PGVCL requests the Hon’ble Commission to consider the same as an uncontrollable loss and allow the entire expenditure towards income tax without any deduction.

3.16.3. A comparison of actual taxes for FY 2019-20 with the amount approved by the Hon’ble Commission shows an uncontrollable gain/(loss) of Rs. 23.39 Crores as indicated in the table below:

TABLE 29 : TREATMENT OF INCOME TAX

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Provision for Tax / Tax Paid 28.71 5.32 23.39

3.17. NON-TARIFF INCOME FOR FY 2019-20

3.17.1. The actual value of Non-Tariff Income of PGVCL is Rs. 323.75 Crores as against Rs. 258.58 Crores approved by the Hon’ble Commission results in uncontrollable gain/ (loss) of Rs. (65.17) Crores.

TABLE 30 : TREATMENT OF NON-TARIFF INCOME

Rs in Crores Gain/(Loss) Gain/(Loss) due to FY 2019-20 FY 2019-20 due to Sr. No. Particulars Uncontrollable (Approved) (Actual) Controllable Factor Factor 1 Total Non-Tariff Income 258.58 323.75 (65.17)

3.18. AGGREGATE REVENUE REQUIREMENT FOR FY 2019-20

3.18.1. Based on above, the table below summarises the actual Aggregate Revenue Requirement of PGVCL for FY 2019-20 as against the value approved by the Hon’ble Commission.

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TABLE 31 : AGGREGATE REVENUE REQUIREMENT FOR FY 2019-20 Rs in Crores

FY 2019-20 FY 2019-20 Sr. No. Particulars Deviation (Approved) (Actual)

7 Sub-Total [1 to 6] 16,832.19 18,013.71 (1,181.52)

8 Return on Equity 577.65 588.11 (10.46) 9 Provision for Tax / Tax Paid 28.71 5.32 23.39

3.19. SHARING OF GAINS & LOSSES

3.19.1. MYT Regulations, 2016 specifies the Mechanism for treatment of Gains and Losses on account of Uncontrollable and Controllable expenses. The methodology approved by the Hon’ble Commission for sharing of such gains/ losses is as follows.

Mechanism for sharing of gains or losses on account of Un-controllable 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. 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 Paschim Gujarat Vij Company Limited Page 29

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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 23 shall 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.”

Mechanism for sharing of gains or losses on account of controllable factors “24.1 The 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 shall 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.”

3.19.2. As indicated above, PGVCL has identified all the expenditure heads under controllable and uncontrollable categories. The gain/ (loss) for PGVCL arising as a result of True Up for FY 2019-20 may be suitably passed through in the Tariff as per mechanism specified by the Hon’ble Commission.

3.20. SHARING OF GAIN/ (LOSS) FOR FY 2019-20

3.20.1. Based on the methodology prescribed in the MYT Regulations, 2016, PGVCL has classified various heads of expenses as Controllable & Uncontrollable. The head wise losses/gains have been dealt in the above sections. During FY 2019-20, PGVCL has incurred a net gain/ (loss) of Rs. (202.11) Crores on account of controllable factors while the net gain/ (loss) attributable to uncontrollable factors for FY 2019-20 is Rs. (901.31) Crores.

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3.20.2. The following Table summarizes net gain/ (loss) to PGVCL during FY 2019-20 on account of controllable & uncontrollable factors.

TABLE 32 : NET GAIN/ (LOSS) FOR FY 2019-20 Rs in Crores Gain/(Loss) Gain/(Loss) FY 2019-20 FY 2019-20 due to due to Sr. No. Particulars (Approved) (Actual) Controllable Uncontrollabl Factors e Factors 1 Cost of Power Purchase 14,573.28 15,447.77 (151.22) (723.27) 2 Operation & Maintenance Expenses 1,099.71 1,201.03 21.18 (122.50) 2.1 Employee Cost 1,004.74 1,098.41 25.84 (119.51) 2.2 Repair & Maintenance 165.09 176.89 - (11.80) 2.3 Administration & General Charges 177.35 182.01 (4.66) - 2.4 Other Expenses Capitalised (247.47) (256.28) - 8.81 3 Depreciation 712.43 848.34 - (135.91) 4 Interest & Finance Charges 444.62 442.34 - 2.28 5 Interest on Working Capital - - - - 6 Provision for Bad Debts 2.15 74.22 (72.07) - 7 Return on Equity 577.65 588.11 - (10.46) 8 Provision for Tax / Tax Paid 28.71 5.32 - 23.39 9 ARR (1 to 8) 17,438.55 18,607.14 (202.11) (966.47) 10 Non - Tariff Income 258.58 323.75 - (65.17) 11 Total ARR (9-10) 17,179.97 18,283.39 (202.11) (901.31)

3.21. REVENUE FOR FY 2019-20

3.21.1. During the FY 2019-20, PGVCL’s actual revenue amounted to Rs. 17,424.08 Crores. The break-up is as follows:

TABLE 33 : REVENUE FOR FY 2019-20 Rs in Crores FY 2019-20 FY 2019-20 Sr. No. Particulars (Approved) (Actual) 1 Revenue from Sale of Power 11,345.75 16,780.00 2 Revenue from FPPPA 4,776.57 3 Other Income (Consumer related) 215.43 248.66 Total Revenue excluding subsidy 4 16,337.75 17,028.66 (1 + 2 + 3) 5 Agriculture Subsidy 451.92 395.42 Total Revenue including subsidy 6 16,789.67 17,424.08 (4 + 5)

3.22. REVENUE GAP/SURPLUS FOR FY 2019-20

3.22.1. The Hon’ble Commission in its MYT Order dated 24th April, 2019 has approved Aggregate Revenue Requirement of Rs. 17,182.47 Crores for FY 2019-20. The Hon’ble Commission had also added Revenue gap/ (surplus) of Rs. (295.40) Crores due to Truing up of FY 2017-18 in the Aggregate Revenue Requirement.

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3.22.2. As per the mechanism specified in the MYT Regulation 2016, PGVCL proposes to pass on a sum of 1/3rd of total gain/(loss) on account of controllable factors i.e. Rs. (67.37) Crores and total gain/(loss) on account of uncontrollable factor i.e. Rs. (901.31) Crores to the consumers. Adjusting these to the net Aggregate Revenue Requirement, PGVCL has arrived at the Revised Aggregate Revenue Requirement for FY 2019-20 at Rs. 17,855.75 Crores.

3.22.3. This revised Aggregate Revenue Requirement is compared against the revised income under various heads including Revenue with Existing Tariff of Rs. 16,780 Crores, Other Consumer related Income of Rs. 248.66 Crores, Agriculture Subsidies of Rs. 395.42 Crores and GUVNL profit allocation of Rs. 36.09 Crore, summing up to a Total Revenue of Rs. 17,460.17 Crores. Accordingly, total Revenue Gap / (Surplus) of PGVCL for FY 2019-20 after treatment of gain/(loss) due to controllable / uncontrollable factors is computed at Rs. 395.58 Crores as shown in the table below:

TABLE 34 : REVENUE GAP/ (SURPLUS) FOR FY 2019-20 Rs in Crores FY 2019-20 Sr. No. Particulars (Actual) Aggregate Revenue Requirement 1 17,182.47 originally approved for FY 2019-20 2 Add: Gap/(Surplus) of FY 2017-18 (295.40) Gain / (Loss) on account of 3 Uncontrollable factor to be passed on to (901.31) Consumer Gain / (Loss) on account of Controllable 4 factor to be passed on to Consumer (67.37) (1/3rd of Total Gain / Loss) Revised ARR for FY 2019-20 5 17,855.75 (1 + 2 - 3 - 4)

3.22.4. The Hon’ble Commission is requested to approve above mentioned gap/ (surplus) and allow PGVCL to recover the same in FY 2021-22.

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SECTION 4. COMPLIANCE OF DIRECTIVES

4.1. PREAMBLE

4.1.1. In the Tariff Orders, the Hon’ble Commission has specified following directives to PGVCL, to which, PGVCL is submitting the Compliance, which is as follows:

4.2. COMPLIANCE OF DIRECTIVES

Directive issued vide Tariff Order dated 31.03.2018:

Earlier Directives

4.2.1. Directive 1: Category wise Cost to Serve Report:

Compliance:

PGVCL is in process of preparation of Cost to Serve Report for FY 2019-20 and shall submit at the earliest.

4.2.2. Directive 2: Installation of meters on Distribution Transformers and energy audit:

Compliance:

Status of Meters installed on Distribution Transformer as on September, 2019 is as under.

Nos. as on Meters installed Sr. No. Particulars % 31.03.20 as on 31.03.20 1 Other Than Agriculture 120089 120089 100 2 Agriculture 830584 830584 100 3 Total 950673 950673 100

PGVCL has initiated “Energy Audit” in the Urban areas and “Consumer Mapping” is underway in other areas. As a result, company could achieve considerable reduction in Distribution Losses in Urban areas.

Distribution loss of Urban category Feeders:

Sr. No. Year Unit sent out [MUs] Unit sold out [MUs] % Loss 1 2013-14 5012.00 4181.70 16.57 2 2014-15 5459.75 4618.90 15.40 3 2015-16 5649.86 4817.24 14.74 4 2016-17 5752.84 4954.46 13.88 5 2017-18 5991.58 5179.41 13.56 6 2018-19 6264.97 5460.15 12.85 7 2019-20 6202.29 5482.24 11.61

4.2.3. Directive 3: Losses on JGY feeders:

Distribution loss of JGY Feeder:

Sr. No. Year Unit sent out [MUs] Unit sold out [MUs] % Loss 1 2014-15 4703.27 2902.94 38.28 2 2015-16 5028.06 3221.70 35.90

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3 2016-17 5216.62 3511.92 32.68 4 2017-18 5483.63 3772.45 31.21 5 2018-19 5874.93 4088.23 30.41 6 2019-20 5930.22 4199.85 29.18

PGVCL covers large rural areas of the state and contribution of JGY category loss in overall loss is also significant. Company has taken stringent steps for reduction of losses of JGY category feeders particularly on high loss JGY feeders for taking corrective action. Besides other activities, following specific activities has been carried out by the Company.

2020 – 21 Sr. Activity UOM 2018 -19 2019-20 (Upto No. Sep-20) 1 Deaugmentation of Transformer Nos. 193 121 77 2 DTC meter installation Nos. 1506 2633 652 3 F meter Replaced - 1 Phase Nos. 65381 42981 13075 4 F meter Replaced - 3 Phase Nos. 12489 8968 2448 5 Pilfer proofing of connections - 1 Phase Nos. 78037 64328 26342 6 Pilfer proofing of connections - 3 Phase Nos. 11257 12745 3970 7 Replacement of service line having Joint Nos. 60630 66752 20761 8 Armour service Provided Nos. 4468 4110 752 9 AB Cable Provided Kms 921 1161 140 10 5 KVA DTC Installed Nos. 679 339 39 11 Ag Crossings Removed Nos. 1233 1016 1105 12 Connections Checked Nos. 465655 420976 46125 13 Connection Detected Nos. 73425 60826 4948 14 Locked Premises Verification Nos. 114567 111382 29721 15 Zero Consumption Verification Nos. 283748 273998 56426 16 Cross verification of meter reading Nos. 213898 213338 58008 17 Disconnected conn. Verification Nos. 112047 117266 26037 18 Unconnected conn. Verification Nos. 3072 4330 842 19 Verification of X status connection Nos. 168860 166010 33328 20 Verification of Y status connection Nos. 27434 27919 5058 21 Verification of RGP connections < 50 units Nos. 255438 366148 64751 22 Verification of NRGP connections < 50 units Nos. 49486 55382 18371 Release of New Connections ( All 23 Nos. 53245 56457 11071 category)through E-Urja 24 Maintenance of HT Line Kms 22900 23647 7015 25 Maintenance of LT Line Kms 14728 17075 3849 26 Maintenance of T/C Centers Nos. 18088 19979 6371 Augmentation of Transformer for Ag. Load 27 Nos. 170 178 71 extension

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As directed by Hon’ble Commission, PGVCL selected 582 nos. Jyotigram feeders having more than 50% Distribution Loss for focused action such feeders. Aggregate loss of all such feeders was 48.32 as on March’17 and have reduced to 43.94 as on March’20.

Taking into account the area constraints, available resources and past trend, Company has planned to reduce further 5% during the current financial year.

4.2.4. Directive 4: High Distribution Loss of PGVCL

PGVCL is the largest Distribution Company supplying electricity to approximately 55 lakhs of different category consumers under 12 Districts of Saurashtra & Kutch with 1 Zonal Office, 12 Circle Offices, 45 Divisions and 243 Sub Divisions through 11 KV feeders of various category like; Urban, Industrial, GIDC, Jyotigram, Ag Dom, HT Express, Water Works etc. through HT & LT Network of more than 3 Lakh Kms. over One Lakh Km. geographical area.

PGVCL has started its operation from September 2005 and over all distribution loss level at the end of March-2006 was 38.48%. With the strenuous efforts in distribution loss reduction with adoption of new available technology and equipments, best practice implemented across India in other states, continuous monitoring of installation checking activity, etc., PGVCL has been able to achieve reduction of approximately 24 % over 15 years of working, and present loss level at the end of March-2019 is 14.71%. Category wise comparison of distribution loss level as on March-2006 & March-2020 is as under:-

Sr. % loss as on Mar- % loss as on Category No. 06 Mar-20 1 Urban 29.90 11.61 2 JGY 64.89 29.18 3 Ag Dom 48.87 25.49 4 Industrial 11.45 1.09 5 GIDC 12.81 -0.13 6 Overall 38.48 14.71

From the table, it can be observed that significant loss reduction is achieved in all category feeders including Jyotigram (JGY) category feeders. Distribution loss of JGY category has been reduced from 64.89% to 29.18%, while in Urban category, losses are reduced from 29.90 % to 11.61%.

For having focused action on High Loss feeders, feeders are selected based on its Distribution loss on following criteria and specific actions are planned:

a) Urban category feeders - above 15% loss

b) JGY category feeders - above 50% loss

c) Industrial / GIDC feeders - above 5% loss

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d) Ag Dom feeders - above 50% loss

Feeder wise feeder managers for the selected feeders are nominated and responsibility assigned for carrying out loss reduction activities. Comprehensive planning for the work to be carried out on such feeders is done on the basis of actual field report. Moreover, fortnightly & monthly meeting of Feeder Managers is carried out at various level. Year wise feeders selected and status of Distribution Losses of at the end of each year and at the end of March’20 is as under.

Reducing % trend in % loss % % % % % % Nos. of reductio Nos. of at the loss loss loss loss loss loss selecte n in Year feeders beginni at at at at at at d losses in compared ng of Mar- Mar- Mar- Mar- Mar- Mar- feeders selected to previous Jul-14 15 16 17 18 19 20 feeders year 2014-15 (selectio 48.8 42.1 40.1 38.6 41.0 36.2 18.08 % 1283 1022 54.37 n in Jul- 9 2 4 1 0 9 in 5.5 yrs 14) 44.4 40.6 36.5 34.8 36.3 32.5 12.20 % 2015-16 1491 1297 7 7 1 3 0 6 in 5 yrs 44.5 39.0 37.2 38.5 34.4 10.08 % 2016-17 1466 1388 0 1 0 4 2 in 4 yrs 42.1 37.4 38.1 34.5 7.60 % 2017-18 1354 1209 5 4 7 5 in 3 yrs 39.3 37.1 33.9 5.44 % 2018-19 1307 1112 7 5 3 in 2 yrs 43.2 37.5 5.72 % 2019-20 1640 1448 3 1 in 1 yrs

It can be seen that significant reduction in Distribution Loss is observed on such feeders. For, FY 2019-20, 1640 Nos. of feeders are selected.

For more specific action, feeders are selected based on Distribution Loss as well as increase compare to respective month of Last year Following criteria has been adopted for selection of such feeders.

a) Urban category feeders - above 15% loss

b) JGY category feeders - above 50% loss

c) Industrial / GIDC feeders - above 5% loss

Accordingly, 110 nos. of feeders were identified and selected for FY 2015-16. The result of loss reduction activities on these feeders is as under:-

% loss at the % loss at the end of % Loss reduction Year beginning of the year the year achieved 2015-16 41.30 34.82 -6.48 2016-17 34.82 31.22 -3.60 2017-18 31.22 30.49 -0.73

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2018-19 30.49 32.56 2.07 2019-20 32.56 32.54 -0.02

Similarly, 127 nos. of feeders were identified during FY 2016-17. The result of loss reduction activities on these feeders is as under:

% loss at the % loss at the end of % Loss reduction Year beginning of the the year achieved year 2016-17 47.07 41.69 -5.38 2017-18 41.69 40.78 -0.91 2018-19 40.78 42.52 1.74 2019-20 42.52 39.44 -3.08

Similarly, 103 nos. of feeders were identified during FY 2017-18. The result of loss reduction activities on these feeders is as under:-

% loss at the % loss at the end of % Loss reduction Year beginning of the the year achieved year 2017-18 45.92 42.52 -3.40 2018-19 42.52 41.43 -1.09 2019-20 41.43 39.83 -1.60

Similarly, 113 nos. of feeders were identified during FY 2018-19. The result of loss reduction activities on these feeders is as under:-

% loss at the % loss at the end of % Loss reduction Year beginning of the the year achieved year 2018-19 35.28 32.06 -3.22 2019-20 32.06 33.26 1.20

For FY 2019-20, 120 Nos. of feeders are selected.

% loss as on % loss as on Feeders 2019-20 Mar-19 Mar-20 120 51.72 47.95

Fresh Directive: 4.2.5. Directive 1: To carry out study to implement Time of Day Demand Charges i.e. Demand Charges leviable during Peak Demand period and that leviable during off peak Demand Period. It has been Directed to submit the study report by 1st September, 2020.

Compliance:

On behalf of 4 DISCOMs, GUVNL has engaged a consultant to carry out a detailed study as per above directive of Hon’ble commission. The study work is under progress and Paschim Gujarat Vij Company Limited Page 37

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the study report shall be submitted to Hon’ble Commission in due course upon successful completion of study. The study work was hampered due to Corona Pandemic.

4.2.6. Directive 2: To carry out study for implementation of ToD energy charges for new Residential Roof top Solar Consumer. It has been directed to submit the study report by 1st September, 2020.

Compliance:

On behalf of 4 DISCOMs, GUVNL has engaged a consultant to carry out a detailed study as per above directive of Hon’ble commission. The study work is under progress and the study report shall be submitted to Hon’ble Commission in due course upon successful completion of study. The study work was hampered due to Corona Pandemic.

4.2.7. Directive 3: The Commission by this order has taken various steps viz. reduction in energy charges for LT and HT Lift irrigation category enhancement of Night time rebate for utilisation of electricity by HT Category consumers and enhancement of rebate for Supply at EHV level. While carrying out the said rationalisation, it was expected to achieve some goals which in turn shall benefit the society at large in terms of conservation of energy, betterment of environment, optimisation of power purchases cost and reduction in T & D losses. To analyse whether such goals are met or not, the DISCOMs are directed to keep the record of number of consumers, their consumption during day and night period etc. and report to the Commission on completion of FY 2020-21.

Compliance:

Report will be submitted on completion of FY 2020-21.

4.2.8. Directive 4: To start Mobile Bill Collection Van facility for the Consumers of Rural area. Compliance of this directive to be submitted latest by 30th June, 2020.

Compliance:

PGVCL has submitted its compliance vide letter dated 24th September, 2020.

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SECTION 6. ANNEXURE 1: TARIFF FILING FORMATS

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PASCHIM GUJARAT VIJ COMPANY LIMITED Rajkot MYT Petition, True-up Petition Formats - Distribution & Retail Supply

Sr. Title Reference No. 1 Aggregate Revenue Requirement - Summary Sheet ARR-Summary 2 Customer Sales Forecast Form 1 3 Power Purchase Expenses Form 2 4 Summary of Operations and Maintenance Expenses Form 3 5 Employee Expenses Form 3.2 6 A&G Expenses Form 3.3 7 R&M Expenses Form 3.4 8 Summary of Capital Expenditure & Capitalisation Form 4 9 Assets & Depreciation Form 5 10 Interest Expenses Form 6 11 Interest on Working Capital Form 7 12 Return on Regulatory Equity Form 8 13 Non-tariff Income Form 9 14 Revenue Form 10 15 Truing Up Summary Form 13

NOTE: (1) Electronic copy in the form of CD containing excel sheets of the Forms shall also be furnished. (2) Figures in (-ve) must be shwon in Brackets- (... ) and figures in (+ve) must be shown without Bracket.

PASCHIM GUJARAT VIJ COMPANY LIMITED 43 PASCHIM GUJARAT VIJ COMPANY LIMITED Rajkot MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form Summary: Aggregate Revenue Requirement - Summary Sheet

Distribution Business (Rs. Crore) True-Up Year (FY 2019-20) Sr. Particulars Reference April - March Claimed in No. Tariff Order (Audited) the petition

1 Power Purcahse Expenses Form 2 14,573.28 15,447.77 2 Operation & Maintenance Expenses Form 3 1,099.71 1,201.03 3 Depreciation Form 5 712.43 848.34 4 Interest & Finance Charges Form 6 444.62 442.34 5 Interest on Working Capital Form 7 - - 6 Bad Debts written off 2.15 74.22 7 Contribution to contingency reserves - - 8 Total Revenue Expenditure 16,832.19 18,013.71 9 Return on Equity Capital Form 8 577.65 588.11 10 Income Tax 28.71 5.32 11 Aggregate Revenue Requirement 17,438.55 18,607.14 12 Less: Non Tariff Income Form 9 258.58 323.75 13 Less: Income from Other Business 14 Aggregate Revenue Requirement of Wires Business 17,179.97 18,283.39

Distribution Wires Business

True-Up Year (FY 2019-20) Sr. Particulars Reference April - March Claimed in No. Tariff Order (Audited) the petition

1 Operation & Maintenance Expenses Form 3 702.24 606.91 2 Depreciation Form 5 641.19 763.51 3 Interest & Finance Charges Form 6 400.16 398.11 4 Interest on Working Capital Form 7 - - 5 Contribution to contingency reserves 6 Total Revenue Expenditure 1,743.59 1,768.52 7 Return on Equity Capital Form 8 519.89 529.30 8 Income Tax 25.84 4.78 9 Aggregate Revenue Requirement 2,289.31 2,302.61 10 Less: Non Tariff Income Form 9 25.86 32.37 11 Less: Income from Other Business 12 Aggregate Revenue Requirement of Wires Business 2,263.45 2,270.23

Distribution Retail Supply Business

True-Up Year (FY 2019-20) Sr. Particulars Reference April - March Claimed in No. Tariff Order (Audited) the petition

1 Power Purchase Expenses Form 2 14,573.28 15,447.77 2 Operation & Maintenance Expenses Form3 397.47 594.13 3 Depreciation Form 5 71.24 84.83 4 Interest & Finance Charges Form 6 44.46 44.23 5 Interest on Working Capital Form 7 - - 6 Bad debts written off 2.15 74.22 7 Contribution to contingency reserves 8 Total Revenue Expenditure 15,088.60 16,245.19 9 Return on Equity Capital Form 8 57.77 58.81 10 Income Tax 2.87 0.53 11 Aggregate Revenue Requirement 15,149.24 16,304.53 12 13 Less: Non Tariff Income Form 9 232.72 291.37 14 Less: Income from Other Business 15 Aggregate Revenue Requirement of Retail Supply 14,916.52 16,013.16

Note For FY 2019-20 : GERC Tariff Regulations, 2016 will be Applicable

PASCHIM GUJARAT VIJ COMPANY LIMITED 44 PASCHIM GUJARAT VIJ COMPANY LIMITED Rajkot MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 1: Customer Sales & Forecast Year: FY 2019-20 (MU) Consumer Category & Consumption Total Slab LT 15,656.83 RGP 3,791.39 2,253 Zero 0 1-50 kwh 109.65 51-100 kwh 376 101-250 kwh 1019 Above 250 kwh 748

BPL 68 Zero (0.00) 1-30 kwh 1.98 31-50 kwh 5.02 51-100 kwh 19.95 101-200 kwh 28.42 201-250 kWh 5.43 Above 250 kwh 7.52 Rural 1,397 Zero (0) 1-50 kwh 203 51-100 kwh 381 101-200 kwh 485 201-250 kWh 98 Above 250 kwh 230 BPL - Rural 73 Zero (0) 1-30 kwh 7 31-50 kwh 11 51-100 kwh 25 101-200 kwh 22 201-250 kWh 3 Above 250 kwh 5

GLP All 123

Non RGP 1,930 Consumer other than seasonal consumer 1,925 For installation having contracted load up to and including 10 kW: for entire consumption during the month 1,057 For installation having contracted load exceeding 10 kW: for entire 868 consumption during the month

Seasonal Consumer 5 For installation having contracted load up to and including 10 kW: for entire consumption during the month 1

For installation having contracted load exceeding 10 kW: for entire 4 consumption during the month

LTMD All 1,742.31 Non RGP Night All LTMD Night All Non RGP and LTMD total 3,672.00 LTP - Lift irrigatiom All -

PASCHIM GUJARAT VIJ COMPANY LIMITED 45 WWSP 625 Type I – Water works and sewerage pumps operated by other than 28 local authority: Type II – Water works and sewerage pumps operated by local authority such as Municipal Corporation. Gujarat Water Supply & 15 Sewerage Board located outside Gram Panchayat Area

Type III – Water works and sewerage pumps operated by Municipalities / Nagarpalikas and Gram Panchayats or Gujarat 581 Water Supply & Sewerage Board for its installations located in Gram Panchayats.

Agriculture 7,373 HP Based Tariff-Unmetered Metered Tariff 7,134 Tatkal Scheme 239

Street Light 73 For Local Authorities and Industrial Estates KWH Based Tariff 68 kVAH Tariff Consumers other than local authorities and industrial estates 5

LT Electric Vehicle All

HT & EHT Category 11,965.48 Industrial HT 11,965.48 HTP - I 10,436 1 kVA - 500 kVA of billing demand 2,477 501 kVA - 1000 kVA of billing demand 1,422 1001 kVA - 2500 kVA of billing demand 2,391 For billing demand in excess of 2500 kVA 4,146

Seasonal 60 1 kVA - 500 kVA of billing demand 52 501 kVA - 1000 kVA of billing demand 4 1001 kVA - 2500 kVA of billing demand 4 For billing demand in excess of 2500 kVA -

HTP - II 663 1 kVA - 500 kVA of billing demand 117 501 kVA - 1000 kVA of billing demand 78 1001 kVA - 2500 kVA of billing demand 73 For billing demand in excess of 2500 kVA 395

HTP - III All 19

HTP - IV 784 1 kVA - 500 kVA of billing demand 4 501 kVA - 1000 kVA of billing demand 4 1001 kVA - 2500 kVA of billing demand 38 For billing demand in excess of 2500 kVA 738

HTP V All 4

Railway Traction All

HT Electric Vehicle Charging Stations All Total 27,622.3109

PASCHIM GUJARAT VIJ COMPANY LIMITED 46 PASCHIM GUJARAT VIJ COMPANY LIMITED Rajkot MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 2: Power Purchase Expenses True-Up Year (FY 2019-20)

Total Capacity Variable Total Any Other Total Cost of Installed GUVNL Energy Annual Charges paid/ Utility Cost per Variable Charges (Please Energy Source of Power (Station Capacity share Received Fixed payable by share (%) unit Charges (Rs specify the type purchased (Rs wise) (MW) (MW) (MU) charges (Rs Utility (Rs (Rs/kWh) Crore) of charges) Crore) Crore) Crore)

a b c d e f g h i j GSECL GSECL Gandhinagar - 5 210 878 71.45 4.02 353 425 GSECL Wanakbori - 7 210 970 62.68 3.87 375 438 GSECL Utran GSECL Utran Expan 375 722 239.83 3.52 254 494 GSECL Dhuvaran - 7 107 179 49.57 2.87 52 101 GSECL Dhuvaran - 8 112 87 29.37 3.14 27 57 GSECL Ukai 610 2,669 277.53 3.67 980 1,258 GSECL Ukai Expan 500 2,660 493.14 3.24 861 1,354 GSECL Gandhinagar 3-4 420 651 229.03 4.19 273 502 GSECL Wanakbori 1-6 1,260 3,598 559.73 3.93 1,415 1,975 GSECL Sikka GSECL Sikka Expansion 500 2,451 602.27 3.58 877 1,479 GSECL Kutch Lignite 215 480 79.49 2.70 130 209 GSECL Kutch Lignite Exp unit 4 75 261 56.79 2.52 66 122 GSECL Ukai Hydro 305 765 41.45 - - 41 GSECL Kadana Hydro 242 445 68.62 - - 69 GSECL Dhuvaran CCPP III 376 538 118.27 3.41 184 302 GSECL BLTPS 500 485 110.43 2.89 140 251 GSECL Wanakbori - 8 800 506 141.86 3.31 167 309 Sub Total 6,817 18,347 3,232 3.35 6,154 9,385

IPP's Gujarat State Energy Generation 156 42 30.89 4.03 17 48 Gujarat State Energy Generation Expansion 351 562 169.31 3.67 206 376 Gujarat Industries Power Co Ltd (165 MW) - 13 - 4.10 5 5 Gujarat Industries Power Co Ltd (SLPP) 250 1,423 133.58 1.44 204 338 Gujarat Mineral Development Corp. 250 547 61.92 1.32 72 134 Gujarat Industries Power Co Ltd (145 MW) 42 123 5.54 2.99 37 42 Gujarat Industries Power Co Ltd (SLPP - Exp) 250 1,530 260.68 1.41 216 477 GPPC Pipavav 702 522 313.39 3.57 187 500 Sub Total 2,001 4,761 975 1.98 945 1,920

Central Sector NPC-Tarapur (1 & 2) 160 1,014 - 5.09 516 516 NPC-Tarapur (3 & 4) 274 1,921 - 4.51 867 867 NPC-Kakrapar 125 869 - 1.48 128 128 NTPC-Vindhyachal - I 230 1,514 134.41 1.88 285 419 NTPC-Vindhyachal - II 239 1,553 115.39 1.79 277 393 NTPC-Vindhyachal - III 266 1,905 194.01 1.77 338 532 NTPC-Korba 360 2,566 174.25 1.46 375 550 NTPC-Korba -II 96 686 94.36 1.42 97 191 NTPC-Kawas 187 489 115.29 3.04 149 264 NTPC-Jhanor 237 186 181.02 3.55 66 247 NTPC-Sipat-I 540 3,788 492.28 1.52 578 1,070 NTPC-Sipat - II 273 1,976 239.39 1.57 310 550 NTPC-Kahlagaon 141 806 106.46 2.08 167 274 NTPC-Vindhyachal - IV 240 1,763 265.43 1.74 307 573 NTPC-Mauda 240 1,499 316.87 3.28 492 808 NTPC-Vindhyachal - V 94 720 111.77 1.80 130 242 NTPC-Mauda II 294 1,486 307.84 3.22 479 787 NTP C- Others - - 0.00 - - 0 NTPC- Gadarwara 152 216 154.16 2.58 56 210 NTPC- LARA 78 240 55.05 2.55 61 116 NTPC-Khargone 246 101 29.86 2.97 30 60 Sardar Sarovar Nigam Ltd 216 639 2.05 131 131 Sub Total 4,688 25,937 3,088 2.25 5,840 8,927

Others Captive Power 8 6 - 2.15 1.27 1.27 Renewable - Wind Farms 4,170 8,217 - 3.65 3,000.09 3,000.09 Solar 1,682 2,702 - 7.82 2,112.18 2,112.18 Small/Mini Hydal 21 87 - 4.65 40.47 40.47 Biomass 30 165 - 5.86 96.91 96.91 Competitive Bidding - Essar Power Gujarat Ltd 1,000 4,326 492.52 1.93 833 1,325.40 Adani Power Ltd - (Unit 1 - 4) 1,200 8,369 809.84 2.92 2,446 3,255.72 Adani Power Ltd - (Unit 5 - 6)* 1,200 2,683 133.04 3.12 837 969.87 ACB India Ltd. 200 1,270 178.90 0.67 85 263.46 Coastal Gujarat Power Co Ltd 1,805 11,705 1,144.04 1.89 2,213 3,356.99 Power Excahnge 1,744 - 3.53 616 616.01 Short term bilateral (GMR) 3,353 - 3.17 1,062 1,062.12 Sub Total 11,316 44,627 2,758 13,342 16,100 PGCIL abd POSCO 2,443 2,443 GETCO 3,455 3,455 TOTAL 24,821 93,673 15,950 26,281 42,231

PASCHIM GUJARAT VIJ COMPANY LIMITED 47 PASCHIM GUJARAT VIJ COMPANY LIMITED Rajkot MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 3: Operations and Maintenance Expenses Summary

(Rs. Crore) True-Up Year (FY 2019-20) Sr. April-March Particulars Reference Tariff Order Deviation No. (Audited ) (a) (b) (c ) = (b) - (a) 1 O&M Expenses Form 3.1 1,347.18 1,457.32 110.14 1.1 Employee Expenses Form 3.2 1,004.74 1,098.41 93.67 1.2 R&M Expenses Form 3.4 165.09 176.89 11.80 1.3 A&G Expenses Form 3.5 177.35 182.01 4.66 Other Debits - - - Extraordinary Items - - - Net Prior Period Expenses/(Income) - - - 2 O&M Expense capitalised (247.47) (256.28) (8.81) Total Operation & Maintenance 3 1,099.71 1,201.03 118.95 Expenses (net of capitalisation)

PASCHIM GUJARAT VIJ COMPANY LIMITED 48 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 3.2: Employee Expenses

(Rs. Crore) True-Up Year (FY 2019-20) Sr. April-March (Audited) Particulars No. Non-regulated Regulated Business Total (Audited) Business 1 Salary & Allowances 785.21 2 Impact of 7th Pay Commission (Actual Paid) 119.51 3 Dearness Allowance (DA) 4 House Rent Allowance 5 Conveyance Allowance 6 Leave Travel Allowance 7 Earned Leave Encashment 8 Other Allowances 9 Medical Reimbursement 10 Overtime Payment 11 Bonus/Ex-Gratia Payments 12 Interim Relief / Wage Revision 13 Staff welfare expenses 8.95 14 VRS Expenses/Retrenchment Compensation 15 Commission to Directors 16 Training Expenses 17 Payment under Workmen's Compensation Act 18 Net Employee Costs 19 Terminal Benefits 87.44 19.1 Provident Fund Contribution & Other Funds 75.16 19.2 Provision for PF Fund 19.3 Pension Payments 19.4 Gratuity Payment 20 Other Comprehensive Income 90.97 21 Gross Employee Expenses 22 Less: Provision for 7th pay Commission (68.82) 23 Net Employee Expenses 1,098.41

PASCHIM GUJARAT VIJ COMPANY LIMITED 49 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 3.3: Administration & General Expenses

(Rs. Crore) True-Up Year (FY 2019-20) Sr. April-March (Audited) Particulars No. Non-regulated Regulated Business Total (Audited) Business 1 Rent Rates & Taxes 4.19 2 Insurance 0.32 3 Testing Charges 1.00 4 Telephone 4.77 5 Remuneration to collection agencies 3.44 6 Legal charges & Professional fee 21.20 7 Audit fee 0.20 8 Conveyance & Travel 50.12 9 Directors' Fees 0.00 10 Electricity charges 4.21 11 Water charges 1.53 12 Security arrangements 29.42 13 Consultancy charges 0.55 14 Books & periodicals 15 Computer Stationery 16 Printing & Stationery 7.55 17 Advertisements 1.73 18 Purchase Related Advertisement Expenses 19 Contribution/Donations 20 License Fee and other related fee 21 Vehicle Running Expenses Truck / Delivery Van 22 Vehicle Hiring Expenses Truck / Delivery Van 23 Cost of services procured 24 Outsourcing of metering and billing system 25 Freight Expenses 4.22 26 V-sat, Internet and related charges 27 Entertainment Expenses 0.01 28 Bank Charges 29 Miscellaneous Expenses 1.73 30 Miscellaneous Losses & Write-offs 11.39 31 Expenditure on training to staff 1.45 32 Others 31.16 33 Corporate Social Responsibility (CSR) 34 Computer Expenses 1.51 35 Expenditure on Security Measures for Safety & Protection 36 DSM Expenditure 37 Expenditure on Energy Conservation 0.32 38 Gross A&G Expenses 182.01 39 Less: Expenses Capitalised 40 Net A&G Expenses 182.01

PASCHIM GUJARAT VIJ COMPANY LIMITED 50 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 3.4: Repair and Maintenance Expenses

(Rs. Crore) True-Up Year (FY 2019-20) Sr. No. Particulars (Audited) 1 Plant & Machinery 79.11 2 Buildings 1.49 3 Civil Works 4 Hydraulic Works 5 Lines & Cable Networks 50.31 6 Vehicles 7 Furniture & Fixtures 8 Other purchase related expenses 1.42 9 Others 8.52 10 Restoration of damage due to flood, cyclone etc. 36.04 11 Gross R&M Expenses 176.89 12 Less: Expenses Capitalised 13 Net R&M Expenses 176.89

14 Gross Fixed Assets at beginning of year 15 R&M Expenses as % of GFA at beginning of year

PASCHIM GUJARAT VIJ COMPANY LIMITED 51 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 4: Summary of Capital Expenditure and Capitalisation

Distribution Business (Rs. Crore) True-Up Year (FY 2019-20) Sr. April-March Particulars Tariff Order Deviation No. (Audited ) (a) (b) (c ) = (b) - (a) 1 Capital Expenditure 1,784.10 1,766.16 (17.94)

2 Capitalisation 1,784.10 1,796.23 12.13 3 IDC - 4 Capitalisation + IDC 1,784.10 1,796.23 12.13

Detail Justification shall be provided for variation in approved capital expenditure Note: * and capitalisation vis-a-vis actual capital expenditure and capitalisation

A) Distribution Wires Business

True-Up Year (FY 2019-20) Sr. April-March Particulars Tariff Order Deviation No. (Audited ) (a) (b) (c ) = (b) - (a) 1 Capital Expenditure 1,605.69 1,589.55 (16.14)

2 Capitalisation 1,605.69 1,616.61 10.92 3 IDC 4 Capitalisation + IDC 1,605.69 1,616.61 10.92

Detail Justification shall be provided for variation in approved capital expenditure Note: *and capitalisation vis-a-vis actual capital expenditure and capitalisation

B) Retail Supply Business

True-Up Year (FY 2019-20) Sr. April-March Particulars Tariff Order Deviation No. (Audited ) (a) (b) (c ) = (b) - (a) 1 Capital Expenditure 160.57 158.95 (1.61)

2 Capitalisation 160.57 161.66 1.09 3 IDC 4 Capitalisation + IDC 160.57 161.66 1.09

Detail Justification shall be provided for variation in approved capital expenditure Note: * and capitalisation vis-a-vis actual capital expenditure and capitalisation

PASCHIM GUJARAT VIJ COMPANY LIMITED 52 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 5: Assets & Depreciation Distribution Business

Fixed Assets and Depreciation For True Up year and each Year of MYT Control Period Gross Block- FY 2019-20 Depreciation- FY 2019-20 Net Block- FY 2019-20 Applicable As at the As at the As at the end of rate of As at the As at the end of Particulars * As at the end of the beginning of beginning of the Additions Deductions Additions Deductions the Financial Depreciation beginning of the the Financial Financial Year the Financial Financial Year Year (%) * Financial Year Year Year Land 16.16 6.84 - 23.00 - Buildings 99.16 6.96 - 106.12 3.40 Hydraulic works 0.08 - - 0.08 0.00 Other Civil Works 19.18 1.99 - 21.17 0.68 Plant & Machinery 5,541.05 669.79 19.16 6,191.68 289.43 Lines & Cables 11,300.78 1,124.62 - 12,425.40 543.77 Vehicles 5.78 0.01 0.09 5.70 0.19 Furniture & Fixtures 22.02 1.17 0.01 23.18 1.28 Office Equipments 92.27 2.41 0.14 94.54 0.80 Lease hold land 0.19 0.59 - 0.78 0.02 Computer Software 4.30 1.56 0.32 5.54 8.77 Capital Expenditure on Assets not belonging to utility Spare Units Capital Spares

TOTAL 17,100.97 1,815.95 19.72 18,897.20 - 848.34 -

Total as per Audited Account (for 17,100.97 1,815.95 19.72 18,897.20 848.34 True up year only)

* The particular of asset and rate of depreciation should match with those provided in the applicable Tariff Regulations

PASCHIM GUJARAT VIJ COMPANY LIMITED 53 Distribution Wire Business

Gross Block- FY 2019-20 Depreciation- FY 2019-20 Net Block- FY 2019-20 Applicable As at the As at the As at the end of rate of As at the As at the end of Particulars * As at the end of the beginning of beginning of the Additions Deductions Additions Deductions the Financial Depreciation beginning of the the Financial Financial Year the Financial Financial Year Year (%) * Financial Year Year Year Land Buildings Hydraulic works Other Civil Works Plant & Machinery Lines & Cables Vehicles Furniture & Fixtures Office Equipments Assets taken over from licensees pending final valuation Computer Software Capital Expenditure on Assets not belonging to utility Spare Units Capital Spares

TOTAL - 763.51 - -

PASCHIM GUJARAT VIJ COMPANY LIMITED 54 Distribution Retail Supply Business

Gross Block- FY 2019-20 Depreciation- FY 2019-20 Net Block- FY 2019-20 Applicable As at the As at the As at the end of rate of As at the As at the end of Particulars * As at the end of the beginning of beginning of the Additions Deductions Additions Deductions the Financial Depreciation beginning of the the Financial Financial Year the Financial Financial Year Year (%) * Financial Year Year Year Land Buildings Hydraulic works Other Civil Works Plant & Machinery Lines & Cables Vehicles Furniture & Fixtures Office Equipments Capital Expenditure on Assets not belonging to utility Spare Units Capital Spares

TOTAL - 84.83 - -

PASCHIM GUJARAT VIJ COMPANY LIMITED 55 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 6: Interest Expenses

A. Normative Loan

True-Up Year (FY 2019-20) April-March Sr. Tariff Order Deviation Source of Loan (Audited) No. (a) (b) (c ) = (b) - (a)

1 Opening Balance of Normative Loan 3,104.83 3,158.88 54.05 2 Less: Reduction of Normative Loan due to retirement or replacement of assets 3 Addition of Normative Loan due to capitalisation during the year 1,027.13 996.54 (30.59) 4 Repayment of Normative loan during the year 712.43 848.34 135.91 5 Closing Balance of Normative Loan 3,419.53 3,307.08 (112.45) 6 Average Balance of Normative Loan 3,262.18 3,232.98 (29.20) 7 Weighted average Rate of Interest on actual Loans (%) 9.69% 9.71% 0.00 8 Interest Expenses 315.99 313.92 (2.07) 9 Interest on Security Deposit from Consumers and Distribution system Users 126.02 126.41 0.39 10 Other Bank Charges 2.62 2.01 (0.61) 11 Finance Charges 12 Total Interest & Finance Charges 444.62 442.34 (2.28)

PASCHIM GUJARAT VIJ COMPANY LIMITED 56 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 7: Interest on Working Capital

Interest on Working Capital - Distribution Business

A. True-up Year (FY 2019-20)

True-up Year (FY 2019-20) Sr. No Particulars Norm Tariff Order Audited True-Up Petition Computation of Working Capital 1 O&M expenses 91.64 100.09 100.09 2 Maintenance Spares 168.77 171.01 171.01 3 Receivables 1399.14 1452.01 1,452.01 4 Working Capital requirement 1659.55 1723.102297 1,723.10 Less: Amount held as security deposit from Distribution 5 2016.26 2112.48 2,112.48 System Users 6 Total Working Capital (356.71) (389.38) (389.38)

Computation of working capital interest 7 Interest Rate (%) 10.65% 10.66% 0.11 8 Interest on Working Capital 0 0.00 -

9 Actual Working Capital Interest

Interest on Working Capital - Distribution Wire Business

A. True-up Year (FY 2019-20)

True-up Year (FY 2019-20) Sr. No Particulars Norm Tariff Order Audited True-Up Petition Computation of Working Capital 1 O&M expenses 10.01 2 Maintenance Spares 17.10 3 Receivables 145.20 4 Working Capital requirement 172.31 Less: Amount held as security deposit from Distribution 5 211.25 System Users 6 Total Working Capital (38.94)

Computation of working capital interest 7 Interest Rate (%) 10.66% 8 Interest on Working Capital -

9 Actual Working Capital Interest -

Interest on Working Capital - Retail Supply Business

A. True-up Year (FY 2019-20)

True-up Year (FY 2019-20) Sl. No Particulars Norm Tariff Order Audited True-Up Petition

Computation of Working Capital 1 O&M expenses 90.08 2 Maintenance Spares 153.91 3 Receivables 1,306.81 4 Working Capital requirement 1,550.79 Less: 5 Amount held as security deposit 1,901.23 6 Total Working Capital (350.44)

Computation of working capital interest 7 Interest Rate (%) 10.66% 8 Interest on Working Capital -

9 Actual Working Capital Interest -

PASCHIM GUJARAT VIJ COMPANY LIMITED 57 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 8: Return on Regulatory Equity - Distribution Wire & Retail Supply Business

Distribution Business

True-Up Year (FY 2019-20) Sr. Particulars Legend Claimed in No. Norm Tariff Order Petition 1 Regulatory Equity at the beginning of the year A 3,905.99 3,987.26 2 Capitalisation during the year B 3 Equity portion of capitalisation during the year C 440.20 427.09 Reduction in Equity Capital on account of retirement / 4 D replacement of assets 5 Regulatory Equity at the end of the year E=A+C-D 4,346.19 4,414.35

Return on Equity Computation 6 Return on Regulatory Equity at the beginning of the year F 7 Return on Regulatory Equity addition during the year G=(C-D)/2 8 Total Return on Equity 577.65 588.11

Distribution Wires Business

True-Up Year (FY 2019-20) Sr. Particulars Legend Claimed in No. Norm Tariff Order Petition 1 Regulatory Equity at the beginning of the year A 3,515.39 3,588.53 2 Capitalisation during the year B - - 3 Equity portion of capitalisation during the year C 396.18 384.38 Reduction in Equity Capital on account of retirement / 4 D - - replacement of assets 5 Regulatory Equity at the end of the year E=A+C-D 3,911.57 3,972.91

Return on Equity Computation 6 Return on Regulatory Equity at the beginning of the year F - - 7 Return on Regulatory Equity addition during the year G=(C-D)/2 - - 8 Total Return on Equity 519.89 529.30

Distribution Retail Supply Business

True-Up Year (FY 2019-20) Sr. Particulars Legend Claimed in No. Norm Tariff Order Petition 1 Regulatory Equity at the beginning of the year A 390.60 398.73 2 Capitalisation during the year B - - 3 Equity portion of capitalisation during the year C 44.02 42.71 Reduction in Equity Capital on account of retirement / 4 D - - replacement of assets 5 Regulatory Equity at the end of the year E=A+C-D 434.62 441.43

Return on Equity Computation 6 Return on Regulatory Equity at the beginning of the year F - - 7 Return on Regulatory Equity addition during the year G=(C-D)/2 - - 8 Total Return on Equity 57.77 58.81

PASCHIM GUJARAT VIJ COMPANY LIMITED 58 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 9: Non-tariff Income

Distribution Business (Rs. Crore) True-Up Year (FY 2019-20)

Sr. April-March Particulars Tariff Order Deviation Remarks No. (Audited)

(a) (b) (c ) = (b) - (a) Interest on staff loans and advances Interest from others Income from sale of scrap 0.69 Gain on sale of fixed assets (net) 0.18 Income from Staff Welfare Activities Grant for energy conservation 0.34 Capital grants ( Deferred amount 10% W.Back) 235.23 Cons. contribution ( Deferred amount 10% W.Back) Provisions no longer required Grant for R&D expenses 0.20 Delay Payment Charges Penalties received from Suppliers 33.67 Sale of material to related parties 1.28 Rents of land or buildings Income from investments Interest from supervision charges on job work/deposits 6.900599231 Rental from staff quarters Revenue subsidies and grants Income from hire charges from contractors and others Income from advertisements Miscellaneous receipts 45.25362342 Prior Period Income Other (Pls. specify) … Total 258.58 323.75 65.17

Distribution Wires Business (Rs. Crore) True-Up Year (FY 2019-20) April-March Sr. Tariff Order Deviation Particulars (Audited) Remarks No. (a) (b) (c ) = (b) - (a)

Interest on staff loans and advances - Interest from others - Income from sale of scrap 0.07 Gain on sale of fixed assets (net) Income from Staff Welfare Activities Grant for energy conservation 0.03 Capital grants ( Deferred amount 10% W.Back) 23.52 Cons. contribution ( Deferred amount 10% W.Back) Provisions no longer required - Miscellaneous receipts 0.02 Delay Payment Charges - Penalties received from Suppliers 3.37 Recovery of Reactive charges 0.13 Rents of land or buildings Income from investments Interest on advances to suppliers/contractors Rental from staff quarters Rental from contractors Income from hire charges from contractors and others Income from advertisements Miscellaneous receipts Prior Period Income Other (Pls. specify) … Total 25.86 32.37 6.52

Distribution Retail Supply Business (Rs. Crore) True-Up Year (FY 2019-20)

April-March Sr. Tariff Order Deviation Particulars (Audited ) Remarks No.

(a) (b) (c ) = (b) - (a)

1 Interest on staff loans and advances - 2 Interest from others - Income from sale of scrap 0.62 Gain on sale of fixed assets (net) Income from Staff Welfare Activities - Grant for energy conservation 0.31 Capital grants ( Deferred amount 10% W.Back) 211.70 Cons. contribution ( Deferred amount 10% W.Back) Provisions no longer required - Miscellaneous receipts 0.18 Delay Payment Charges - Penalties received from Suppliers 30.30 Recovery of Reactive charges 1.16 Rents of land or buildings Income from investments Interest on advances to suppliers/contractors Rental from staff quarters 3 Rental from contractors 4 Income from hire charges from contractors and others 5 Income from advertisements 6 Miscellaneous receipts 7 Prior Period Income 8 Other (Pls. specify) 9 … Total 232.72 291.37 58.65

PASCHIM GUJARAT VIJ COMPANY LIMITED 59 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 10: Revenue for True-up Year (FY 2019-20)

True-up Year (FY 2019-20)

Revenue from Revenue from Total Revenue Total Revenue (Rs. Government Category No. of consumers Sales in MU Fixed/Demand Energy Charges (including Subsidy) Crore) subsidy (Rs. Crore) Charges (Rs. Crore) (Rs. Crore) (Rs. Crore)

HT & EHT Category Industrial HT 5,963.00 11,962.19 1,320.71 5,343.46 8,836.33 - 8,836.33 Railway Traction (Bulk Supply to KPT) - 3.09 - - 4.63 - 4.63 - Low Voltage Category - RGP 36,95,787.00 3,791.39 63.21 1,220.13 2,184.10 - 2,184.10 GLP 31,119.00 122.69 2.38 47.58 77.28 - 77.28 Non-RGP & LTMD 6,82,499.00 3,672.00 305.03 1,670.80 2,752.13 - 2,752.13 Public Water Works 17,890.00 624.52 24.96 227.09 396.17 - 396.17 Agriculture 10,31,776.00 7,372.87 142.19 343.69 2,022.60 461.46 2,484.06 Street Light 8,285.00 73.36 0.13 29.45 45.29 - 45.29 Total 54,73,319 27,622.113 1,858.60 8,882.20 16,318.53 461.46 16,779.99

PASCHIM GUJARAT VIJ COMPANY LIMITED 60 PASCHIM GUJARAT VIJ COMPANY LIMITED RAJKOT MYT Petition, True-up Petition Formats - Distribution & Retail Supply Form 13: Truing-up Summary

True-up Year (FY 2019-20)

Distribution Business Sr. Approved Actual Deviation Reason for Particulars Controllable Uncontrollable No. (a) (b) (c=a-b) Deviation

1 Power Purchase Expenses 14,573.28 15,447.77 (874.49) (151.22) (723.27) 2 Operation & Maintenance Expenses 1,099.71 1,201.03 (101.32) 21.18 (122.50) 3 Depreciation 712.43 848.34 (135.91) - (135.91) 4 Interest and Finance Charges 444.62 442.34 2.28 - 2.28 5 Interest on Working Capital - - - 6 Bad debts written off 2.15 74.22 (72.07) (72.07) - 7 Contribution to contingency reserves - 8 Total Revenue Expenditure 16,832.19 18,013.71 (1,181.52) 9 Return on Equity Capital 577.65 588.11 (10.46) - (10.46) 10 Income Tax 28.71 5.32 23.39 - 23.39 11 Aggregate Revenue Requirement 17,438.55 18,607.14 (1,168.59) (202.11) (966.47) 12 Less: Non Tariff Income 258.58 323.75 (65.17) - (65.17) 13 Less: Income from Other Business 14 Less: Receipts on account of Cross Subsidy Surcharge 15 Less: Receipts on account of Additional Surcharge on charges for wheeling 16 Add: DSM expenses 2.50 17 Aggregate Revenue Requirement 17,182.47 18,283.39 (1,103.42) (202.11) (901.31) 18 Revenue from Sale of electricity 16,780.00 (16,780.00) 19 Revenue Gap/(Surplus) 395.58 (395.58)

Distribution Wires Business (Rs. Crore) Sr. Approved Actual Deviation Reason for Particulars Controllable Uncontrollable No. (a) (b) (c=a-b) Deviation

1 Operation & Maintenance Expenses 702.24 606.91 95.34 (69.16) 164.49 2 Depreciation 641.19 763.51 (122.32) - (122.32) 3 Interest & Finance Charges 400.16 398.11 2.05 - 2.05 4 Interest on Working Capital - - - - - 5 Contribution to contingency reserves 6 Total Revenue Expenditure 1,743.59 1,768.52 (24.93) (69.16) 44.22 7 Return on Equity Capital 519.89 529.30 (9.42) - (9.42) 8 Income Tax 25.84 4.78 21.05 - 21.05 9 Aggregate Revenue Requirement 2,289.31 2,302.61 (13.30) (69.16) 55.86 10 Less: Non Tariff Income 25.86 32.37 (6.52) - (6.52) 11 Less: Income from Other Business 12 Aggregate Revenue Requirement of Wires Business 2,263.45 2,270.23 (6.78) (69.16) 62.38 13 Revenue from Wheeling Charges 14 Revenue Gap/(Surplus)

Distribution Retail Supply Business Sr. Reason for Particulars Approved Actual Deviation Controllable Uncontrollable No. Deviation

1 Power Purchase Expenses 14,573.28 15,447.77 (874.49) (151.22) (723.27) 2 Operation & Maintenance Expenses 397.47 594.13 (196.66) 90.33 (286.99) 3 Depreciation 71.24 84.83 (13.59) - (13.59) 4 Interest on Long-term Loan Capital 44.46 44.23 0.23 - 0.23 5 Interest on Working Capital - - - - - 6 Bad debts written off 2.15 74.22 (72.07) (72.07) - 7 Contribution to contingency reserves - - - - - 8 Total Revenue Expenditure 15,088.60 16,245.19 (1,156.58) (132.96) (1,023.62) 9 Return on Equity Capital 57.77 58.81 (1.05) - (1.05) 10 Income Tax 2.87 0.53 2.34 - 2.34 11 Aggregate Revenue Requirement 15,149.24 16,304.53 (1,155.29) (132.96) (1,022.33) 12 Less: Non Tariff Income 232.72 291.37 (58.65) - (58.65) 13 Less: Income from Other Business 14 Less: Receipts on account of Cross Subsidy Surcharge 15 Less: Receipts on account of Additional Surcharge on charges for wheeling 16 Aggregate Revenue Requirement from Retail Tariff 14,916.52 16,013.16 (1,096.64) (132.96) (963.68) 17 Revenue from Sale of electricity - 16,780.00 (16,780.00) 18 Revenue Gap/(Surplus)

Note: Please give detailed explanation separately for the deviations on account of uncontrollable factors

PASCHIM GUJARAT VIJ COMPANY LIMITED 61