Hyderabad: After the wooing, the time has come now for the hard push. With votes sealed in GHMC polling machines, citizens might have to brace up for a power tariff hike across Telangana.
Distribution companies have been purchasing power from private firms since last year at around '5 per unit incurring expenditures running into several crores of rupees.
To make up for this, a steep hike in tariff is inevitable. Experts say the financial burden is set to go up with discoms getting ready to ensure nine-hour daytime supply to the agriculture sector, a commitment made by Chief Minister Chandrasekhar Rao.
Last year, discoms had shown a revenue deficit of over '5,100 crore after which the Electricity Regulatory Commission allowed a tariff hike.
This year, they will need to spend another '4,000 crore for the agriculture sector need. Discoms have floated tenders to purchase 2,000 MW power.
"Another '3,000 crore expenditure would come on account of a 10 per cent increase in operation and maintenance costs every year. There also are accumulated losses of nearly '15,000 crore since 2007-08," said an expert from the energy department.
Under the Ujwal Discom Assurance Yojana, even if the government bears three-fourth of the '15,000 crore accumulated losses, the discoms would still be short of '3,000 crore. "To overcome the revenue deficit, there is no choice but to go for a steep hike in tariff," he said. Sources say the total revenue deficit of the two discoms would be over '10,000 crore.
"Even if the Telangana government pays discoms '6,000 crore as subsidy for the free power supply to the agriculture sector, they would still be left with a '4,000crore deficit.
ERC to vet deal on power
The Telangana state government's long-term agreement with the Chhattisgarh government to purchase 1,000 MW, that has come under sharp criticism.
The agreement will now be vetted by the Electricity Regulatory Commission.
The ERC will conduct a public hearing on the deal on February 11.
TS Transco and Genco Chairman and managing director D. Prabhakar Rao said they were waiting for details from the Centre on the Union Cabinet's green signal for new tariff orders as well as for the other reforms.
“What benefits can be passed onto the consumers in Telangana state would be known only after we receive the full details from the Centre,” Prabhakar Rao said.
Summer to trigger more demand
With the temperatures soaring - the mercury has already touched 35ºC - power consumption is also going up in the state. From less than 120 million units a day in the first week of January, the state is consuming 134 MU and the demand is expected to rise to 180 million units in summer.
Officials say this is mainly due to the government’s plan to provide nine-hour uninterrupted supply during day time to agriculture sector. Experts say the officials are projecting "too much demand".
The power requirement may not exceed 8,000MW as most places have little ground water, and consumption by the agriculture sector may not be that high.
The total installed capacity in Telangana is less than 6,000 MW, from both thermal and hydel. Most dams are dry and there hardly any hydel generation currently.
Telangana Genco and Transco chairman and managing director D. Prabhakar Rao said in addition to the share from Central generating stations and agreements with private producers, the state will need 2,000 MW more to meet the projected demand.
"We have invited tenders for 2000 MW short-term power purchase agreements. Our tie-ups with companies for 2,000 MW will continue upto May 27, thereafter we need power. That's why we have called for tenders." Concerns are being raised that the power utilities may actually not require 10,000 MW of power.
