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Adopt multi-year power tariff framework: Centre

Staff Reporter

The Delhi Government is yet to firm up its stand

NEW DELHI: The power tariff policy announced by the Union Government in January 2006 specifies that a multi-year tariff framework has to be adopted for any tariff determined from April 1, 2006, but the Delhi Government is yet to firm up its stand on the issue.

The Delhi Electricity Regulatory Commission's draft detailing the MYT framework is still awaiting approval and notification in the Gazette.

According to DERC officials, the proposed MYT policy aims at giving "an element of certainty to all stakeholders. The basic premise is that tariffs would not fluctuate beyond a certain bandwidth".

Touted to benefit power consumers as well as the distribution companies, the policy according to officials allows the latter to plan the controllable spending while protecting consumers from frequent hikes in charges.

"We have had discussions with the discoms on the issue and have incorporated some suggestions after a review. Their main concern was that if there is a need procure power in addition to that allowed or if the rates go up, these factors would get reflected in the tariffs, then the discoms cannot be asked to pay from their pockets," officials said.

The MYT framework will divide all costs into two broad categories -- controllables and non-controllables.

Expenditures on administrative and general expenses, repair and maintenance will come under controllables while power purchase and rise in costs will come under non-controllables.

Sources in the State Power Department said unlike the current arrangement, where the discoms have a fixed return rate, they will now have to check their controllable costs failing which they will have to take a cut in their revenues.

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