Is Delhi govt favouring private discoms?

A day after Delhi Electricity Regulatory Commission (DERC) increased the domestic power tariff to a whopping 34 per cent, an RTI revealed that DERC amended the multi-year tariff (MYT) regulations 2007 allegedly contrary to law.

In the recent RTI filed by Atul Goyal, a consumer activist, it has been alleged that the retail tariff was to be reduced by about 25 per cent in the early 2010.

The private distribution companies (discoms), including Anil Ambani controlled BSES Rajdhani Power Ltd (BRPL), BSES Yamuna Limited (BYPL) and North Delhi Power Limited (NDPL), joint venture companies of Delhi government, approached city government to stall the order. Accordingly, the government had, on 4 May 2010, directed the authorities concerned not to issue the tariff order till further instructions.

However, tariff order was prepared and approved for the period 2010-2011 and it was found by DERC that the financial accounts of the private discoms were manipulated.

In reality, the discoms made enormous profits, but the private discoms showed losses.

The commission also found out that for 2010-2011 had a surplus of Rs 3,577 crore, which would have been increased further as per DERC findings. Although, because of illegal interference by Delhi government, the tariff order could not be issued.

Later, the regulator had in August last year hiked the tariff by 22 per cent for all categories of consumers to favour the discoms.

The RTI also revealed that the amendment proposed was never published as draft as required under section 181(3) of Delhi EA 2003.

Therefore, only by order of DERC, the tariff regulation, which is part of legislature, cannot be termed as amended and is illegal and void.

Another point, which the RTI pointed out, is that as per provision of ‘Delhi Electricity reforms act 2000’, DERC was supposed to send any such amendments made to the regulations to Delhi legislative assembly immediately after it was made.

However, DERC did not send the regulations for approval by the state assembly in accordance with law.

Goyal said, ‘DERC is for both consumers and private discoms, but DERC has been manipulated clearly by private firms with the help of city government. Various rules have been amended by DERC contrary to law. We demand that CAG or CBI should begin their investigation as it is a grave problem.’

The matter was even taken to the Delhi high court in 2010, and the court observed the action of Delhi government as illegal and the effect of the order to DERC was nullified.

Meanwhile, at a recent assembly session, the matter was raised by the Bharatiya Janata Party senior leader Harshvardhan.

Talking to Millennium Post
, Harshvardhan said, ‘It is clear that government is helping the private players. Investigation agency should take some action over this RTI and bring justice to the people.’


Chief Minister Sheila Dikshit on Wednesday hinted about the possibility of a relief to poor consumers from the steep 26 per cent hike in power tariff.

‘We are thinking over it... ummed pe duniya kayam hai [the world survives on hope],’ Dikshit said when asked whether government would subsidise the poor consumers.

Dikshit’s comment came after some Congress MLAs and MPs joined BJP in criticising the power tariff hike and pitched in for providing subsidy to the poor consumers.

Critical of the DERC decision to hike the tariff, east Delhi MP and the Chief Minister’s son Sandeep Dikshit said Delhi government should insulate the poor consumers by providing some subsidy.

‘I feel subsidy should be given to poor people... Concession should be given wherever it could be given,’ said Dikshit, adding that the ‘government will have to take a reasonable stand on the issue.’

Slamming the Delhi Electricity Regulatory Commission for the ‘huge increase’ in tariff, west Delhi MP Mahabal Mishra demanded Dikshit’s intervention to ensure rollback of the hike.

‘The DERC hiked the tariff. The Delhi government has nothing to do with it. The Chief Minister should intervene and ensure rollback of the tariff,’ said Mishra.

DPCC president J P Agarwal also criticised the hike and said he does agree with the decision.

The Delhi Electricity Regulatory Commission (DERC) had on Tuesday hiked the tariff for domestic consumers by a steep 26 per cent, which was the fourth increase in the last 10 months. The new rates would be effective from 1 July. For the last four years, Delhi government has been providing subsidy of Rs 1 per unit for domestic customers whose monthly consumption of electricity does not exceed 200 units.

Officials said as DERC announced a new tariff order, government would have to take a fresh decision as the previous notification would lapse when the new tariff comes into effect.
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