Resist power tariff hike in Odisha

March 26, 2015

Finally Odisha Electricity Regulatory Commission (OERC) has nodded to hike Power Tariff in Odisha. From April 2015 domestic power consumers of the state will have to pay additional 20 paise more per unit. Kutir Jyoti consumer are to pay monthly Rs.80 instead of Rs.65 earlier. Tariff of power use in agriculture is raised by 40 paise per unit, that is about twenty times of the earlier price. Is it in the benefit of the people of the state ? What are the reasons cited by OERC in favour of Tariff Hike ? The principal reason cited is to pass through of Rs.740.72 Cr towards power purchase dues to NTPC by GRIDCO as per the CERC order.  If this is the reason, what steps has been taken by Govt controlled GRIDCO to collect its past dues to the tune Rs.4570.42 Cr from the distribution companies including  Reliance Infrastructure Ltd, a private company entrusted for  power distribution in three fourth area of the state. Burden of GRIDCO should not be be sifted to the shoulders of consumers of the state.

Loss of GRIDCO is due to mismanagement and undue favour to the private power distribution company & private owned captive power generators like Vedanta. It was pointed out by CAG in its report of 2012-13 that GRIDCO had purchased excess power of the captive power plants of different companies without the permission of OERC as required by law and the rates quoted by these plants were blindly accepted by GRIDCO with out any bargaining or negotiation. By such practice GRIDCO had to face the loss and thus the ultimately tariff hike is the only channel of rescue.

The account and balance sheet produced before OERC by the power distribution companies are fraud in nature. Whatever they table  is accepted with minor changes. Who has audited these accounts ? Are they audited by CAG or any other Govt agency ?It is a demand throughout the country to audit the accounts of private power distribution companies by Govt agencies. Delhi Govt has already decided to audit through CAG. Why both, the Odisha state Govt and OERC are silent during last 15 years Raj of private power distribution company in Odisha ? The power distribution companies are yet to repay the loan amount of 1014.87Cr to Govt of Odisha. This loan  was transferred  by Govt of Odisha incurring loan from World Bank and other sources paying interest. They were supposed to develop infrastructure, decrease the distribution and transmission loss and to provide quality electricity to the the consumers of the state. Power distribution companies have criminally neglected in all these areas and Govt of Odisha acted as the facilitators of marauder activities of private companies.

OERC in its order today wants to take credit for not enhancing the Monthly Minimum Fixed Charges (MMFC). Why the consumers will pay the MMFC when the billing is done on the basis of actual consumption ? In the last 15 years private distribution company has collected thousands of crorers of rupees from the consumers in the name of MMFC. OERC instead of abolishing the system of MMFC has retained the same. It was also debated in the current session of Odisha Legislative Assembly.

Odisha is the first state in our country to embarrass World Bank prescribed  reform in Power Sector. Odisha is the first state to unbundle the vertically integrated power sector. Odisha is the first state to privatise the power distribution. What is the experience ? State Govt has washed away its hands from power distribution and regulation. OERC is a body created by OLA but not answerable or accountable to OLA. Both the state Govt and OERC work hand in glove to sift the burden on the people of the state. In 2014 because of the elections OERC did not increase tariff. This was designed to help the ruling BJD. Now since the elections are over BJD signalled for a hike and OERC acted upon.

Resist this power tariff hike  till it is resumed back. Build up powerful movement  till the private power distribution company is taken in to task for its loot in one and half decade Raj.

- Ali Kishor Patnaik.
Secretary CPI(M)
Odisha State Committee.