Financial Daily from THE HINDU group of publications
Sunday, May 21, 2006
Industry & Economy - Power
Power distributing cos in Delhi stem losses
Immediate implication could be unlikely hike in tariff.
Larger connotation is that the Capital's distribution sector is managing operational break-even at the existing tariffs levels.
New Delhi , May 20
In what could be a shot in the arm for private players in the power distribution sector following the Orissa debacle, the Tata Power and Reliance Energy-managed three utilities handling electricity distribution in Delhi have reported a turnaround.
Reliance Energy-owned BSES Yamuna and BSES Rajdhani and Tata Power-owned NDPL have projected a net revenue surplus for the current fiscal at last year's tariff levels.
While the immediate implication could be that any tariff hike in the Capital during the current fiscal is unlikely, the larger connotation is that the Capital's distribution sector is managing operational break-even at the existing tariffs levels.
In the Annual Revenue Requirement submitted by the distribution companies to the Delhi Electricity Regulatory Commission for the current fiscal, BSES Rajdhani has projected a net revenue surplus of Rs 12 crore, BSES Yamuna a net surplus of Rs 75 crore and NDPL has projected a net revenue surplus of Rs 28.33 crore at last year's tariffs.
Delhi Transco, the State-owned transmission utility that supplies power to the distribution firms, continues to bleed, with a projected revenue gap of Rs 1,303 crore during the current fiscal.
Commenting on the performance of the private players, the Union Power Secretary, Mr R.V. Shahi, said: "Delhi has witnessed ever increasing losses, both T&D losses and financial gaps, during the entire Eighth and Ninth Plan periods.
Now that aggregate technical and commercial (AT&C) losses as well as financial losses have started declining, it is no doubt a positive development for the sector."
Loss reduction target
All three firms have bettered the five-percentage point AT&C loss reduction target, as warranted under the privatisation agreement.
NDPL is, in fact, reporting a seven percentage-point reduction in AT&C loss figure at around 28 per cent, against loss levels of 35.35 per cent reported by the utility for last fiscal.
BSES Yamuna has projected AT&C loss levels to come down to 39.95 per cent during the current fiscal against 45.07 per cent in 2005-06, while BSES Rajdhani has projected AT&C losses to fall to 31.01 per cent during 2006-07 against 36.67 per cent last year.
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