MERC invites bids for a second power distribution licence in Mumbai...

 

Maharashtra Electricity Regulatory Commission (MERC) has invited bids for a second power distribution licence in Mumbai which is currently held by Tata Power Co. Ltd.

Tata Power’s licence ends on 15 August.

Currently, Mumbai is served by three distribution utilities—municipal undertaking Brihanmumbai Electric Supply and Transport or BEST, Tata Power, and Reliance Infrastructure Ltd.

According to a 2008 Supreme Court verdict, Tata Power has distribution licence for Colaba in the south to Mahim in the north and from Nariman Point in the south to Saion in north, served exclusively by BEST. However, BEST does not want Tata Power to enter the island city by claiming that, under the Electricity Act 2003, a municipal undertaking enjoys monopoly in its licence area. BEST and Tata Power are fighting out the issue in the apex court.

Since the apex court recognized the right of Tata Power in 2008 to enter into retail power distribution business, it has managed to lure 414,000 consumers from Reliance Infrastructure.

According to MERC’s tender notice, out of the 414,000 consumers of Tata Power, 87% are domestic consumers, 11% are commercial consumers and 2% are industrial consumers.

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Need Rs 1.6k cr power subsidy for Mumbai to do a Delhi...

 

If Mumbai is to replicate the Delhi model of a 50% power tariff cut for the majority of residential consumers, it would require an annual subsidy of at least Rs 1,600 crore, experts say.

Of the city's 41 lakh power consumers, 27 lakh are residential subscribers with under 400 units of use-the category for which rates have been halved in Delhi.

Though power experts and distribution companies are sceptical about tariffs being slashed in Mumbai in the near future, Congress MP Sanjay Nirupam has demanded subsidised power, specially for slum dwellers. "If Delhi can announce a cut in power tariff for the general public, why can't Mumbai follow suit?" he asked. Seeking a 50% price cut for residential consumers in the island city and the suburbs, he wrote to chief minister Prithviraj Chavan on Wednesday.

"I have also demanded that whatever subsidy is announced, it should reach the common man; power discoms should not get any benefit from it. Also, there should be an inquiry into the cost structure and pricing mechanism adopted by the discoms," Nirupam said.

A source from the government's energy department doubted the possibility of power tariff being slashed for domestic consumers in Mumbai in the near future. "The structure and functioning of discoms is totally different in the two cities. In Delhi, the government has stakes in the three discoms. In Maharashtra, it will be difficult for even MSEDCL to introduce a subsidy in a metro city, not to speak of private operators," the source said.

"Also, the government cannot lower tariffs in the guise of public interest, thereby discriminating against consumers of other commodities. Neither can it ignore residential consumers in other districts," said a consumer rights activist.

Former BEST committee member Ravi Raja said the undertaking, which supplies 980 MW of power daily to 10 lakh consumers from Colaba to Mahim-Sion, does not need to depend on the state government and can seek a subsidy from its parent body, the BMC. "If there is political will, the BMC can give a subsidy to the ailing BEST and provide relief to at least 7 lakh domestic consumers by bringing down tariff in the island city," he said. BMC sources said the civic body has already planned a subsidy of Rs 350 crore for BEST's transport division and has no plans to give a subsidy to the power wing.

Power expert Ashok Pendse, who represents consumer groups at MERC hearings, said it was "practically impossible" for the state government to give subsidies to discoms. "First, the state does not have any stake in private players like Tata Power and RInfra. Second, there is no legal provision that allows the government to announce a reduction in tariff. It has to be done by the regulatory body, which in our case is the Maharashtra Electricity Regulatory Commission."

He said that to reduce tariff for residential consumers, one needs cross subsidization. "Will MERC increase industrial and commercial tariff to subsidize residential consumers in Mumbai?"

Chief minister Prithviraj Chavan said his government set up a high-level committee headed by industries minister Narayan Rane to take stock of the power situation, and it has submitted its report. "We are processing the recommendations. We will place the report before the cabinet as early as possible," Chavan told TOI on Wednesday.

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Tata Power gets approval to postpone solar target until 2016...

 

Tata Power Co. Ltd won approval from an Indian state electricity regulator to postpone fulfilment of annual solar-power procurement targets by as many as five years to 2016.

The utility unit of India’s biggest industrial group has been unable since 2010 to source enough solar power to meet government renewable mandates because of a shortage of sun-based generation in the country, the Maharashtra Electricity Regulatory Commission said in a 20 December order.

“It faced a genuine difficulty,” the commission said, waiving fines and ordering the company to fulfil five years of targets by 31 March 2016.

The government requires electricity distributors and large industrial companies to get as much as 10% of their power each year from renewables. In Maharashtra state, where Tata Power generates and distributes electricity, the company faced a solar procurement target of 0.25% that rises to 0.5% in the fiscal year starting April.

India doesn’t have the 3,500 megawatts of installed solar capacity required to allow all companies to comply with their obligations, according to the order. As of October, the nation had 2,080 megawatts, less than 60% of the capacity needed, according to data from the ministry of new and renewable energy.

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MERC against competitive bidding in wind power purchase by state Discoms...

 

Even as MSEDCL is facing allegations of irregularities in power purchase, Maharashtra Electricity Regulatory Commission (MERC) has turned down a plea in which MSEDCL was seeking transparency.

MSEDCL wanted to purchase wind power through competitive bidding, but the Commission wants MSEDCL to buy it at rates fixed by it. MSEDCL filed a petition in MERC seeking a review. The Commission agreed that it was a valid point, but referred the matter to a committee headed by principal secretary (energy), with representatives of wind power companies, Maharashtra Energy Development Agency (MEDA) and consumers representatives. Incidentally, principal secretary (energy) Ajoy Mehta is also managing director of MSEDCL.

The committee was constituted on October 1 to study wind energy situation in the state and was asked to submit its report in three months. The Commission has refused to grant interim relief to MSEDCL in the meantime.

Mahagenco and MSEDCL had accused the Commission of favouring wind power producers. They charged that the rates of wind power approved by it are the highest in the country, but the rates of solar power, whose sole generator is Mahagenco, are one of the lowest. However, the Indian Wind Power Association (IWPA) submitted data to MERC proving MSEDCL wrong.

MERC's rate for wind power ranges from Rs 4.93 to Rs 5.67 per unit, which is far higher than thermal power rates (except new units of Mahagenco). MSEDCL has resolutely opposed purchase of wind power on the grounds that it will burden consumers, but MERC has not refused to buy this agreement. Now, MSEDCL wants competition to lower the rates.

During the hearing, MSEDCL submitted that the rates of solar power have come down due to competition, and the same would happen in wind also. It pointed out that Section 63 of the Electricity Act, 2003, did not make any segregation in purchase of renewable energy and non-renewable energy.

While agreeing that wind power was costly, MERC told MSEDCL that it had to meet renewable energy purchase obligation (RPO) target set by central government. The company had failed to meet its target in 2012-13 even though the entire contracted capacity of 2,350MW had been commissioned.

MERC has also turned down MSEDCL's plea for a uniform wind power tariff in the state. The Commission has divided the state into two zones for calculating the rates. It is Rs 4.93 per unit in one zone and Rs 5.67 per unit in the other. The Commission said in the order that zoning was done after taking views of all concerned parties and as per norms of renewable energy tariff regulations. Therefore, any revision was not desirable, it said.

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Maharashtra to formulate guidelines for distributed Solar generation having less than 1 MW capacity...

 

Maharashtra Electricity Regulatory Commissions while ruling on a petition regarding formulation of guidelines for connectivity to solar generators below 1 MW, have formulated a Working Committee to examine and prepare a draft Terms of Reference for the said matter.

The basis of the petition was to enable and encourage investment in the distributed solar generation by various types of consumes having capacity and willingness to invest in solar power for the purpose of captive consumption but are restricted by the existing regulatory framework which does not allow connectivity with the grid for solar power plants below 1 MW. This would also benefit retail level consumers.

Under the said petition various relaxations were sought for the distributed solar generation having capacity 1 MW and below in Maharashtra.

Some of the major requirement laid down in the petition are:

• Finalization of connectivity norms for Solar generators below 1MW with minimum procedures and paper work for consumers especially for captive consumption with generation/consumption at one or multiple places.
• Waiving off transmission/wheeling charges & Cross Subsidy Surcharge for the power so generated from Solar Power Generation Plants for the consumers consuming the power during the active solar power generation period.
• Charging differential rate as banking charge per unit for the consumers opting for “Power Banking Scheme” & consume power deposited any time in 24 hrs.
• Formulization of procedure for metering and certification of power generated by micro solar power plants to be accounted only for the purpose of reducing REC buying liabilities and if needed charge reasonable metering & certification charges per KW certified to the beneficiary.

Various models, described and considered are:

1. Generation and consumption during day time
• Generation and consumption within the same premises
• Generation outside the premises at single or multiple locations
• Generation at one location and consumption at multiple locations
2. Generation during day time with facility of banking power with Discoms and consumption during 24 hrs as needed.
3. Generation and consumption by corporate business houses for getting credit to reduce their REC buying liabilities / RPO.

While carrying out the regulatory proceedings in the matter, MERC has invited comments from various stakeholders and considered the submissions from the Discoms (Such as BEST, R-Infra, MSEDCL), MSETCL, SLDCs and have made the following observations:

• Appreciated the concerns highlighted in the petition and recognized the need to harness solar energy and requirements to promote decentralized form of solar installations of less than 1 MW capacity.
• However, prayers laid down in the petition requires dealing with numerous technical, commercial, regulatory and operational issues to enable grid connectivity of small rooftop solar PV power plants for captive consumption and third party wheeling.
• The Central Electricity Authority (Technical Standards for Connectivity of Distributed Generation Resources) Regulations, 2013 stipulate standards and strive to address certain technical aspects associated with the present matter.
• For several other issues, merit comprehensive study requires public consultation to address state specific situation, which has been highlighted by several stakeholders.
• Further, the Central Electricity Authority (Installation of and Operation of Meters) Amendment Regulations, 2013, which shall be applicable to all Grid Interactive Renewable Energy Plants seeking connectivity to the grid at 415 V and below voltage levels, is presently in the draft stage and the same is yet to be finalized. The said metering Regulations shall play a significant role in outlining important regulatory framework enabling metering, energy accounting and grid connectivity for solar generators of less than 1 MW. Thus, finalization of the same is also an important milestone to address the issues in the present petition.
• Besides, grid connectivity of solar power plants having an installed capacity of less than 1 MW shall have a bearing on almost all categories of consumers and various regulations such as grid code, supply code, open access regulations etc. As such, it is essential that any amendment in the regulatory provisions with respect to the same will have to follow a diligent exercise of identifying implementation aspects and addressing the same through a comprehensive stakeholder and public consultation process.

Hence, considering the above MERC has directed the following:

• In view of the complexities involved in the matter and the far-reaching implications that it would have on the distribution companies and LT level consumers, the Commission has decided to study the issues involved in the matter in detail.
• Thus, the Commission directs formation of a Working Committee under Director (EE), MERC along with the representatives from all impleaded parties (MSEDCL, TPC-D, RInfra-D, BEST, MSETCL, STU & MSLDC), including the Petitioner and Prayas Energy Group to study issues involved in the matter. The Working Committee is further directed to prepare a draft Terms of Reference (ToR) and submit it to the Commission for approval.
• The Committee shall submit its report to the Commission within period of six months from the date of issuance of this Order, which shall form the basis for formulation of appropriate regulatory framework for exploring grid connectivity of solar generators below 1 MW.

The complete order can be downloaded from here.

 

Source: MERC

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BEST started supplying 20 MW solar power to Mumbai...

 

With the supply of 20 MW solar power to the island city, the BEST has taken a big step towards providing green energy to its consumers. Sources said the power was being given at a price cheaper than market rates.

"We have started feeding our grid with 1.85 million units of solar power, generated in October, which is being procured through renewable energy sources. We expect to generate solar energy up to 2.58 million units every month," said BEST general manager Om Prakash Gupta.

According to MERC regulations for renewable energy purchase obligations, every utility in the state is mandated to procure certain percentage of its power requirement through renewable energy sources. For solar power, this percentage is 0.25% from 2010-11 to 2012-13 and 0.5% from 2013-14 to 2015-16.

As approved by the BEST committee in May, the power utility firm entered into a deal with M/s Welspun Energy Pvt Ltd for generating 20 MW solar power. "The BEST has taken steps to procure solar power, helping the green cause," BEST senior spokesperson A S Tamboli said.

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Cross-subsidy surcharge in open access to rise in Maharashtra...

 

Industries in Maharashtra will have to shell out more to avail open access due to a rise in cross-subsidy surcharge (CSS). The trigger is a recent order by the Maharashtra Electricity Regulatory Commission (MERC) to increase CSS from September 1 this year with retrospective effect.

Industry bodies argue open access will become an unviable proposition because, apart from higher CSS, they will have to pay charges towards transmission and distribution losses, wheeling charges and administrative charges. This will amount to more than Rs 3.60 per unit over and above the purchase of power through open access.

For extra high voltage (EHV) express feeder consumers, CSS in open access has increased from Rs 1.63 a unit to Rs 2.75 a unit; for EHV non-express feeder consumers, it has risen from Rs 1.20 a unit to Rs 2.26 a unit. In the case of high-tension express feeder consumers, CSS has increased to Rs 2.30 a unit from Rs 1.18 and for high-tension non-express feeder consumers, it has risen from 76 paise a unit to 1.82 a unit.

Jayant Deo, founder member of Maharashtra Electricity Regulatory Commission, told Business Standard: "'The increase in CSS is against the Electricity Act, 2003 and also the National Tariff Policy. In fact, as per the third proviso of section 42 (2) of the Electricity Act, 2003, the surcharge and cross-subsidies are required to be progressively reduced in the manner as may be specified by the regulator. However, in this case, MERC has not given the roadmap for the same. MERC’s order is against the very preamble of the Electricity Act, 2003 which demands transparency in the subsidies."

On the other hand, R B Goenka, chairman of Vidarbha Industries Association's (VIA) Energy Cell, said there won't be any competition in the power sector and the consumers drawing power from the state-run Maharashtra State Electricity Distribution Company will have no other option to purchase power from it despite high tariff. "In our view, the CSS is unrealistic and misplaced. CSS in open access cannot be increased till a road map for reduction in cross-subsidy is decided,'' he added. According to Goenka, VIA will soon approach the Appellate Tribunal for Electricity challenging the MERC's order.

According to S L Patil, advisor, Thane Belapur Industries Association, industries will not be able to avail cheap power from various sources in the country. Higher CCS, as proposed, will kill the spirit of competitiveness in the power sector and is detrimental to industrial growth, which is already struggling with the high cost of inputs, he noted.

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MSEDCL blames MERC, activists for high electricity tariff...

 

Under attack from all quarters over high power tariff in the state, MSEDCL officials have blamed consumer activists and Maharashtra Electricity Regulatory Commission (MERC) for the recent steep tariff hike. Senior officials also ask that why these activists don't evaluate the performance of private companies like Tata Power and Reliance.

"MSEDCL had to recover some dues from consumers from 2009-10 onwards. However, MERC did not allow us to do so until this September. Naturally, when an accumulated account is to be recovered in six months, the surcharge will be higher," a senior official said.

The official further said that MSEDCL had done a lot of capital expenditure in the last two years to improve the power infrastructure. "We have to recover this cost from consumers. Under pressure from consumer activists, MERC did not allow us to recover it on time. Now it has told us to recover expenses of two years in six months," he told TOI.

Another official launched a direct attack on the consumer activists. "The rates approved by MERC for wind energy are the highest in the country. MERC is promoting wind energy suo motu. Why have these activists never raised this issue? MSEDCL had repeatedly told the Commission that this costly power would only burden common consumers," he said.

The official further said that MERC's consumer representatives never targeted Reliance for its high industrial power tariff. "Reliance does not have agricultural consumers. Still its tariff is Rs 9.12 per unit while that of MSEDCL is Rs 8.22 per unit and that too for six months. They were also silent during the Tata Power asset valuation controversy. Why do they target only government companies," he asked.

MSEDCL has also contended that while comparing its power tariff with that of Gujarat, the consumer activists forget that subsidy to powerlooms in Gujarat is very low. "The consumer activists want low cross subsidy for industries, low tariff for farmers and powerlooms and other consumers. We don't have a magic wand. If industrial tariff reduces, that of others will increase. Open access will hit poor and middle class consumers. This is the harsh reality and consumer activists must accept it," he stressed.

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Joint Electricity Regulatory Commission order for RPO Compliance...

 

Immediately after the land mark order given by the honorable Maharashtra Electricity Regulatory Commission on the enforcement and strict compliance of the Renewable Purchase Obligations (RPO) including the Distribution Licensees including  the entire backlog upto FY 2012-13 and for the current financial year FY 2013-14, the honorable Joint Electricity Commission for the state of Goa and UTs (Union Territories) which regulates the Electricity Departments of Goa, Andaman & Nicobar, Chandigarh, Dadra & Nagar Haveli, Daman & Diu, Lakshadweep and Pudducherry has also reviewed their previous order in this regard and has given strict instructions to obligated entities to comply with their RPOs by 31st March 2014 and to submit their compliance report by 20.12.2013.
 
The commission has also stated that if the licensees / OEs fail in the compliance the commission shall be constrained to proceed under Regulation 4 of the JERC (Procurement of Renewable Energy) Regulations, 2010 against the licensees/ OEs. In case of default the Obligated Entity has to deposit into a separate fund, to be created and maintained by State Agency, such amount as the Commission may determine on the basis of the shortfall in units of RPO and the forbearance price. Moreover the Obligated entity is also liable for penalty as may be provided by the Commission under Section 142 of Electricity Act, 2003.
 
This order is seen as a major initiative towards compliance of RPO and will boost the confidence of the RE investors especially in Solar and the bankers and financers in the REC mechanism.
 
The main point to be noted here is that CED (Chandigarh Electricity Department) is perhaps the only Electricity Distribution Company which has as per the provisions of the regulations has purchased Solar RECs towards an attempt to comply with their shortfall in Solar RPO.
 
Based on this order if the distribution companies come forward to comply with their deficit Solar RPO by the mean of purchase of Solar RECs this will lead to a demand of around 2.5 Lakh Solar RECs. This will clear almost 50% of the REC inventory from both the power exchanges.
 
The Joint Secretary Ministry of New & Renewable Energy Mr. Tarun Kapoor has personally shown major interest in the compliance of the Solar RPO and promotion of Solar Energy in the country and has also urged regulatory commission to suitably revisit their regulations in respect of the solar RPO from the period of 2013-14 to 2021-22 and suitable revise the same upwards and also take appropriate steps to ensure that the obligated entities comply with the stipulated target set in the regulations notified by the commission for solar RPO.
 
On this occasion Mr. Vikalp Mundra, Joint Managing Director, Ujaas energy Limited has expressed his happiness and said that the initiatives like consensus by the Forum of Regulators on the need of stricter action against non-compliance of RPO targets, need of invoking
provisions in the regulation in the form of imposing non-compliance charges in case of default and then these orders will help in boosting the investments in this sector.
 
Ujaas Energy Limited formerly known as M and B Switchgears Limited which is the first company to have a solar power plant under REC mechanism and is pioneer in the field of Solar REC has installed more than 60 MW of solar power plants under REC mechanism for themselves and for their various clients in India and is in process to install 100 MW more by March 2014.
 
Mr. Mundra further says that compliance of RPO should not be done only because of the regulations and should not be treated as a burden on the Obligated Entity or on the consumers. The biggest challenge faced today by the humanity is the global warming and the impact of the climate change and we need to mobilize our national energies and resources in meeting climate change. OEs must recognize the adverse impact of the climate change and the need to address this issue a major step needs to be taken in letter and spirit by the means of compliance of the RPO. All these initiatives are taken in larger public interest. Based on the same other regulators should also come forward with similar orders and should ensure the compliance of the RPOs by the Obligated Entities.

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Hearing in MERC on the petition filed by vidarbha industries against MSEDCL on billing issue...

 

Maharashtra Electricity Regulatory Commission (MERC) will on November 13 hear a petition filed by industries against illegal bills issued by MSEDCL in September. Vidarbha Industries Association (VIA) too has filed the petition on behalf of all industrial associations in Vidarbha.

MERC in August had allowed MSEDCL to levy six surcharges from September. However, MSEDCL levied them in August bills itself in violation of Commission's order. In spite of protests by industrialists, MSEDCL did not provide any relief. The surcharges have increased electricity bills by 20%.

The industrialists have contended that while it does not matter to residential and commercial consumers whether they start paying surcharges from August or September, industries had suffered heavy losses. The reason is that industries had fixed the price of their goods on the basis of power tariff prevailing in August. Had they known the power rates would increase by 20% they would have increased price accordingly. However, they had sold their products at lower prices in August but the input cost had increased which caused them losses.

Nineteen industries and VIA have filed similar petition and hence MERC has clubbed them. They have demanded that the Commission should register case against MSEDCL officials under Section 142 & 146 of Electricity Act for violating MERC's directives. An organization or official convicted under these sections can be fined up to Rs 1 lakh.

The industries have also prayed that MSEDCL be directed to issue corrected bill for August 2013 without surcharges. They have also demanded that only three surcharges instead of six should be levied in September and corrected bills for this month should also be issued. All consumers should be refunded excess amount with interest.

This is the first step by industries and consumers to fight high handed behaviour of MSEDCL. They also plan to challenge MERC's order on six surcharges in Appellate Tribunal for Electricity (ATE) and lodge a complaint against MSEDCL in Competition Commission of India for misusing its power in a monopoly situation.

Many industrialists had earlier decided not to pay August bills but this was opposed by textile industries and this form of protest was dropped. Now the industries are concentrating on legal measures and taking up the issue with chief minister Prithviraj Chavan. The industrialists have also joined hands with other consumers to expose MSEDCL and Mahagenco. MSEDCL's inflation of farmers' bills has become a major embarrassment for the distributor while Genco is at pains to explain its extremely high cost of generation.

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MERC's order for migration of 8 Lac R-Infra consumers to tata power postponed till December 10...

 

Maharashtra Electricity Regulatory Commission has deferred the hearing of Reliance Infrastructure's petition regarding MERC's order for switching over of RInfra's consumers to Tata Power.

RInfra-D earlier had filed an Appeal before the Hon’ble Appellate Tribunal for Electricity (APTEL) seeking for interim stay on the operation of the MERC Order dated 30 October, 2013. The Hon’ble APTEL has admitted the Appeal and in its Order dated 31 October, 2013, has directed as under:

“After hearing the parties, we are of the view that instead of granting stay of the Impugned Order, it would be better to direct the Appellant to approach the Commission to seek for the extension of time for the implementation of this impugned order. Accordingly ordered.

The Learned Senior Counsel for the Applicant also submits that the Applicant will file the application for extension of time tomorrow itself before the State Commission. In view of the fact that the Appellant will approach the Commission seeking for extension of time, we deem it appropriate to direct that implementation of the Impugned Order be postponed till the order is passed by the State Commission in the Application for seeking extension of time to be filed by the Appellant tomorrow i.e. on 01.11.2013.
The Commission may entertain the said application and consider the extension time for implementation and pass an order accordingly.”

RInfra-D has then filed an application to MERC requesting to postpone the implementation of the Order beyond 13 November, 2013, i.e., the date on which RInfra-D’s appeal is scheduled for hearing before the Hon’ble APTEL.

However, TPC-D submitted that RInfra-D has to justify its prayer for postponement of the migration of 8 lakh consumers from RInfra-D to TPC-D before the Commission. But neither the present application nor the Interim Application filed by RInfra before the Hon’ble APTEL discloses any specific issues or operational difficulties in the implementation of the directions.

During the hearing, the Commission asked RInfra-D to justify its request for extension of time and RInfra submitted that they will submit their say in writing to the Commission.

Considering the importance of the matter, the Commission hereby grants additional time till 30 November, 2013 to RInfra-D to make a detailed submission on affidavit on its request for extension of time for implementation of the Order.

The next hearing in the matter shall be held on 10 December, 2013. The date for implementation of the Commission’s Order has been postponed till 10 December, 2013.

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Tata Power's low-end consumers to soar 7.92 lakh in Mumbai...

 

The ongoing tussle between Tata Power and Reliance Infrastructure (R-Infra) to lure consumers in Mumbai is expected to become even more embittered.

The Maharashtra Electricity Regulatory Commission (MERC) has ordered the transfer of R-Infra’s 7.92 lakh low-end residential consumers with a monthly power consumption of 0-300 units to Tata Power's distribution arm from November 1. MERC has asked Tata Power to supply electricity to these new low-end consumers from the R-Infra distribution network. Tata Power will pay wheeling, regulatory asset charges and other costs to R-Infra.

However, R-Infra had approached the Appellate Tribunal for Electricity (ATE) challenging MERC's order. ATE has not stayed Merc's order, but will hear R-Infra’s petition on December 17. In the meantime, according to ATE’s order, R-Infra has again approached

MERC for extending the timeline for transfer of its consumers to Tata Power. The hearing is slated for November 8 at Merc.

A Tata Power spokesman said, “'Tata Power is studying the order.” On the other hand, an R-Infra spokesman stated, “R-Infra approached ATE, as the time-span given to implement Merc directives was too short and inadequate.”

Currently, of the 4.25 lakh consumers, Tata Power is supplying power to 2.50 lakh low-end residential consumers. However, R-Infra's low-end consumer base will fall to 1.1 million from the present 1.9 million. R-Infra is currently supplying power to a total of 2.8 million in Mumbai.

The current tariff charged by R-Infra from low end residential consumers for the 0-100 slab is Rs 3.93 per unit while Tata Power's tariff is Rs 2.13 per unit. For the 101-300 slab, R-Infra charges Rs 6.84 per unit against Tata Power's Rs 3.62 per unit. This excludes fixed charge.

These consumers are from the 11 clusters in Mumbai identified by Merc to introduce competition in the distribution business and thereby protect the interest of the common man, specifically low-end consumers by option of cheaper electricity to be sourced from TPC-D. Industry players believe that the transfer will  bring parity in the number of low-end residential consumers serviced by both the utilities. Further, R-Infra's subsidy burden is expected to come down.

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Industry miffed as Maharashtra Electricity Regulatory Commission allows higher cross subsidy charge...

 

In what may be a gain for farmers, but a loss for the manufacturing sector, Maharashtra Electricity Regulatory Commission (MERC) has approved a hike in cross subsidy surcharge (CSS) from Rs 1.18-1.60 per unit to Rs 2.30-2.75 a unit respectively.

This has left the industries miffed. CSS is a charge levied from the industry when it buys power from open market rather than the state-owned utility MSEDCL.

It is levied to make good the losses on account of cheap power for agricultural and other consumers. For this reason, MSEDCL charges industry a higher rate but if the industries buy power from sources other than MSEDCL, government does not get the money for funding subsidy. CSS is charged on purchases from open market to bridge the gap.

Vidarbha Industries Association (VIA) has been lobbying hard to do away with the CSS. However, the deputy chief minister Ajit Pawar, who also heads the power ministry, has flatly refused on the grounds that funds were needed for subsiding the farmers and poor consumers. MERC decision to hike the CSS has left the industries disappointed. VIA said that it would appeal the order.

R B Goenka, who represents VIA in MERC, said the order would kill competitiveness of private power players operating in open market. After adding the increased CSS, power from open market becomes almost equal to MSEDCL.

"MSEDCL charges Rs 7.50 per unit on average. With higher CSS, power from open market would be costlier at Rs 7.65 a unit. If the load factor incentive is claimed by a consumer, MSEDCL tariff can be further reduced to around Rs 6.75 a unit," said Goenka.

Goenka claims high power tariff had hit industrial production in state. He is relying on year-on-year change in consumption by high tension users. "The consumption has come down by 2% this year," he said. HT users include commercial establishments, townships as well as industries. According to Goenka's estimates it was likely that the industrial consumption may have gone down by 5% but consumption by commercial establishments and townships increased leading to a net fall of 2%.

 

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MERC issues order on compliance of RPO by Captive & Open Access Consumers...

 

Maharashtra Electricity Regulatory Commission has issued an order for the compliance of Renewable Purchase Obligations (RPO) by Captive user & Open Access Consumers in the state of Maharashtra.

 

Brief details of the order are as follows:

• The Order covers only enforces the Captive Users and Open Access Consumers in the state of Maharashtra for Compliance of RPO.
• Above mentioned Obligated Entities are directed to fulfill their RPO targets for both Solar & Non Solar for all the four years i.e. from FY 2010-11 to FY 2013-14 cumulative before 31st March 2014.

• A Working Committee shall be formed which will focus on continuous monitoring of RPO compliance by a structured mechanism. The committee shall comprise of key officials from MERC, MEDA, MSLDC, PWD & Individual Consultants.

a. Mechanism for "Listing & Accreditation" of Obligated Entities

b. Mechanism for establishing the "Data Flow & Formats and Information Exchange

c. Compliance review on "Bi-monthly" basis

• Key responsibilities of MEDA:

a.    Submission of report on formation of Working Committee by 30^th September, 2013.
b.    Bi-monthly reporting to the commission on the development of RPO Mechanism.
c.     Quarterly update to the Commission on RPO Compliance by obligated entities.

• Every obligated entity has mandatorily submit “Monthly Reports over RPO Compliance" to MEDA.
  
• In case of non-fulfillment, penal mechanism as per the regulations stipulated in the MERC REC-RPO Regulations, 2010.

 

The said order will have positive impact on the struggling REC market in India for both Solar & Non-Solar segments and shall definitely improve REC market future in India.

 

Complete order by MERC is embedded below for further reading...

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Tata Power to invest Rs 1,000 Cr to lay cables in Mumbai…

 Tata Power, India's largest private power generation company is planning to lay its own distribution cable network in the Mumbai with the investment of  around Rs 1,000 crore over the next three years.

Currently, Tata Power serves around 8 lakh consumers using the distribution netwok of BEST and Reliance Infrastructure. For this, Tata Power is charged wheeling charges by Reliance Infrastructure and BEST which it has to recover from its consumers.

 

Earlier, Tata Power was not allowed to lay parallel network in the Distribution area of Reliance Infrastructure, however after the Supreme Court order they are allowed for the same. Tata Power has put up a proposal to the MERC for laying down the network.

Meanwhile, Spark found that in a recent order of the MERC, the regulator had granted Reliance Infrastructure the license to distribute electricity in the suburbs for 25 years as the company's license was expiring on August 15.

The MERC had rejected the proposals of four other bidders, including Torrent Power, Lanco Infrastructure, MSEDCL and Indiabulls, saying they did not have their own networks in place and in "public interest" it granted Reliance Infrastructure the license.

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