Uttar Gujarat Vij Company Limited (UGVCL)
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GUJARAT ELECTRICITY REGULATORY COMMISSION Tariff Order Truing up for FY 2018-19 and Determination of Tariff for FY 2020-21 For Uttar Gujarat Vij Company Limited (UGVCL) Case No. 1839 of 2019 31st March, 2020 6th Floor, GIFT ONE, Road 5C, Zone 5, GIFT CITY Gandhinagar-382 355 (Gujarat), INDIA Phone: +91-79-23602000 Fax: +91-79-23602054/55 E-mail: [email protected] : Website www.gercin.org GUJARAT ELECTRICITY REGULATORY COMMISSION (GERC) GANDHINAGAR Tariff Order Truing up for FY 2018-19, and Determination of Tariff for FY 2020-21 For Uttar Gujarat Vij Company Limited (UGVCL) Case No. 1839 of 2019 31st March, 2020 Uttar Gujarat Vij Company Limited Truing up for FY 2018-19 and Determination of Tariff for FY 2020-21 CONTENTS 1 Background and Brief History....................................................................................... 11 1.1 Background........................................................................................................... 11 1.2 Uttar Gujarat Vij Company Limited (UGVCL) ........................................................ 11 1.3 Commission’s Orders for Approval of final ARR for FY 2016-17 and Approval of Multi- Year ARR for FY 2016-17 to FY 2020-21 ........................................................................ 12 1.4 Commission’s Order for Approval of True Up for FY 2016-17 and Determination of Tariff for FY 2018-19 ....................................................................................................... 13 1.5 Commission’s order for Approval of True up for FY 2017-18, Mid-Term Review of ARR for FY 2019-20 and FY 2020-21, and determination of Tariff for FY 2019-20 .......... 13 1.6 Background of the present Petition ....................................................................... 13 1.7 Registration of the Current Petition and Public Hearing Process ........................... 14 1.8 Approach of this Order .......................................................................................... 16 1.9 Contents of this Order ........................................................................................... 16 2 Summary of UGVCL’s Petition ..................................................................................... 18 2.1. Introduction ........................................................................................................... 18 2.2. True up for FY 2018-19 ......................................................................................... 18 2.3. Revenue Surplus/ (Gap) for FY 2018-19 ............................................................... 19 2.4. Summary of projected Revenue Gap/(Surplus) for FY 2020-21 ............................ 20 2.5. Prayers of UGVCL to the Commission .................................................................. 20 3 Brief Outline of objections raised, response from UGVCL and Commission’s view ...... 22 3.1 Public Response to the Petition ............................................................................ 22 3.2 Suggestions/ Objections common to all DISCOMs ................................................ 22 3.3 Suggestions/ Objections pertaining to UGVCL ...................................................... 58 4 Truing up of FY 2018-19 .............................................................................................. 60 4.1 Energy Sales ........................................................................................................ 60 4.2 Distribution Losses ................................................................................................ 62 Gujarat Electricity Regulatory Commission Page i March 2020 Uttar Gujarat Vij Company Limited Truing up for FY 2018-19 and Determination of Tariff for FY 2020-21 4.3 Energy requirement .............................................................................................. 63 4.4 Power Purchase Cost ........................................................................................... 64 4.5 Fixed Cost............................................................................................................. 69 4.5.1 Operation and Maintenance (O&M) Expenses for FY 2018-19....................... 69 4.5.2 Capital Expenditure and Capitalization........................................................... 75 4.5.3 Depreciation................................................................................................... 82 4.5.4 Interest and Finance charges ......................................................................... 84 4.5.5 Interest on Working Capital ............................................................................ 87 4.5.6 Bad Debts Written Off .................................................................................... 89 4.5.7 Return on Equity ............................................................................................ 90 4.5.8 Income Tax .................................................................................................... 92 4.5.9 Non-Tariff Income .......................................................................................... 94 4.6 ARR approved in the Truing up for FY 2018-19 .................................................... 95 4.7 Revenue for FY 2018-19 ....................................................................................... 96 4.8 Revenue (Gap) / Surplus for FY 2018-19 .............................................................. 97 5 ARR and Revenue (Gap)/Surplus for FY 2020-21...................................................... 100 5.1 ARR for FY 2020-21 ........................................................................................... 100 5.2 Revenue from existing tariff FY 2020-21 ............................................................. 100 5.3 Revenue from FPPPA charges ........................................................................... 102 5.4 Other (consumer related) income ........................................................................ 105 5.5 Agriculture Subsidy ............................................................................................. 105 5.6 Total Expected Revenue for FY 2020-21 ............................................................ 106 5.7 Estimated Revenue (Gap)/Surplus for FY 2020-21 ............................................. 107 5.8 Consolidated Revenue (Gap)/Surplus of the State-Owned DISCOMs ................. 108 6 Compliance to Directives ........................................................................................... 111 6.1 Compliance to earlier directives .......................................................................... 111 6.2 Compliance to directives in the recent order ....................................................... 114 Gujarat Electricity Regulatory Commission Page ii March 2020 Uttar Gujarat Vij Company Limited Truing up for FY 2018-19 and Determination of Tariff for FY 2020-21 6.3 Fresh Directives .................................................................................................. 116 7 Fuel and Power Purchase Price Adjustment .............................................................. 118 7.1 Fuel Price and Power Purchase Price Adjustment .............................................. 118 7.2 Base Price of Power Purchase (PPCB) ............................................................... 118 7.3 Shifting of Base FPPPA ...................................................................................... 119 8 Wheeling Charges and Cross-Subsidy Surcharge ..................................................... 120 8.1 Allocation Matrix.................................................................................................. 120 8.2 Wheeling charges ............................................................................................... 121 8.3 Cross-Subsidy Surcharge ................................................................................... 122 9 Tariff Philosophy and Tariff Proposals ........................................................................ 124 9.1 Introduction ......................................................................................................... 124 9.2 Rationalisation of Tariff ....................................................................................... 124 9.2.1 Reduction in the Tariff for Lift Irrigation ........................................................ 124 9.2.2 Merging of Street Light and GLP Category .................................................. 125 9.2.3 Night Time Rebate ....................................................................................... 126 9.2.4 EHV Rebate ................................................................................................. 127 9.2.5 Relaxation to BPL category residential consumers ...................................... 127 9.2.6 Applicability of seasonal tariff ....................................................................... 128 Commission’s Order.......................................................................................................... 129 ANNEXURE: TARIFF SCHEDULE ................................................................................... 130 Gujarat Electricity Regulatory Commission Page iii March 2020 Uttar Gujarat Vij Company Limited Truing up for FY 2018-19 and Determination of Tariff for FY 2020-21 List of Tables Table 2-1: True up for FY 2018-19 (Rs. Crore).................................................................... 18 Table 2-2: Revenue (Gap)/Surplus as claimed by