Hyderabad: The Telangana State Electricity Regulatory Commission (ERC) recently announced in its tariff order for the year 2017-18 that it had reduced the power tariff from Rs 7.10 to Rs 4.05 per unit for the railways. On paper it looks as though tariff on power has been reduced by Rs 3.05 per unit but the actual reduction is only by one rupee. In its recent tariff order, the ERC has imposed an additional ‘demand charges’ that was not there earlier, thereby hiking up the cost again.
The ‘demand charge’ as decided by the ERC is Rs 390 per kilowatt. The Transco officials said that by adding ‘demand charges’ per unit, the cost would rise to Rs 6 per unit. Earlier the unit cost was Rs 7.10 per unit, so the reduction in tariff would actually be around a rupee and not three rupees as projected. The cost-to-serve price (unit cost purchased by Discoms) was decided as Rs 5.65 per unit in the 2016-17 tariff order and the cross subsidy was Rs 1.45 per unit. The Discoms supplied power to the railways at the rate of Rs 7.10 (Rs 5.65+ Rs 1.45). In the tariff order of 2017-18 the cost-to-serve price has been decided as Rs 4.05 and ‘demand charge’ is Rs 390 per kilowatt. At present, the Discoms are supplying power to the railways at the rate of Rs 6 per unit. The ERC removed cross subsidy to the railways and imposed ‘demand charges’.
The TS Transco officials said due to the new tariff announced by ERC to the railways, they will lose around Rs 80 cr per year. The Transco had estimated that it would earn revenue of about Rs 742 cr by supplying power to the railways if they had to abide by the old tariff.
Transco officials further stated that if the railways opt for the Open Access system to purchase power it will cost more than '6 per unit. They said in the Open Access system, sometimes the required quantity of po-wer is not available, in such case, procuring the balance quantity of power would pose to be a challenge. They said if the railways purchase power from Transco, it would be assured of the quantum and there will be no power problem.
