Corporation Limited Truing up of FY 2013-14 and FY 2014-15 ...
Transcript of Corporation Limited Truing up of FY 2013-14 and FY 2014-15 ...
MYT Petition for Transmission & Distribution Business of TSECL
Tripura StateElectricityCorporation LimitedTruing up of FY 2013-14and FY 2014-15 &Multi Year TariffPetition for Generationand Distributionbusiness for FY 2016-17to FY 2018-19
June 2018
MYT Petition for Transmission & Distribution Business of TSECL
Filed By
Tripura State Electricity CorporationBidyut Bhawan, Banamalipur
Agartala, Tripura (W)
Draft MYT Petition for Transmission & Distribution Business of TSECL
Table of Contents1. Form -1: Petition.................................................................................................................... 7
2. Form-2: Affidavit .................................................................................................................. 9
3. Summary of Petition ............................................................................................................11
3.1. Preamble..................................................................................................................................................... 11
3.2. Procedural History .................................................................................................................................... 11
3.3. Current Petition .........................................................................................................................................12
3.4. Contents of the Petition.............................................................................................................................13
4. Power Sector Overview ....................................................................................................... 14
4.1. About the State of Tripura.........................................................................................................................14
4.2. Background of TSECL ...............................................................................................................................14
4.3. Generation Overview.................................................................................................................................15
4.4. Transmission & Distribution Overview....................................................................................................16
5. True Up for FY 2013-14 ....................................................................................................... 18
5.1. Introduction .............................................................................................................................................. 18
5.2. O&M Expenses...........................................................................................................................................19
5.3. Interest on Working Capital......................................................................................................................19
6. True Up for FY 2014-15 ........................................................................................................21
6.1. Introduction ...............................................................................................................................................21
6.2. Asset Base and Capital Expenditure.........................................................................................................21
6.3. Capital Work In Progress ......................................................................................................................... 22
6.4. Investments .............................................................................................................................................. 22
6.5. Working Capital and Interest .................................................................................................................. 22
6.6. Depreciation ............................................................................................................................................. 23
6.7. Reasonable Return ................................................................................................................................... 24
6.8. Expenditure .............................................................................................................................................. 25
6.8.1. Power Purchase Cost ...................................................................................................................... 25
6.8.2. Fuel Cost ......................................................................................................................................... 26
6.8.3. Operation & Maintenance Expenses ............................................................................................. 26
6.8.4. Depreciation ................................................................................................................................... 27
6.8.5. Interest and Financial Charges...................................................................................................... 27
6.9. Income ......................................................................................................................................................28
6.9.1. Income from Sale of Power ............................................................................................................28
6.9.2. Non-Tariff Income..........................................................................................................................28
6.10. Summary of Truing Up........................................................................................................................... 29
7. Generation MYT for the FY 2016-17 to FY 2018-19 ...............................................................31
7.1. Introduction ...............................................................................................................................................31
7.2. Own Generation Parameters.....................................................................................................................31
7.2.1. Plant Load Factor (PLF) and Auxiliary Consumption ...................................................................31
Draft MYT Petition for Transmission & Distribution Business of TSECL
7.2.2. Heat Rate......................................................................................................................................... 33
7.3. Assets Base and Capital Expenditure ...................................................................................................... 33
7.4. Investment ................................................................................................................................................ 35
7.5. Working Capital ........................................................................................................................................ 35
7.6. Return on Equity and Tax on Income ..................................................................................................... 36
7.7. Expenditure............................................................................................................................................... 37
7.7.1. Fuel Cost .......................................................................................................................................... 37
7.7.2. Operation and Maintenance Cost ..................................................................................................38
7.7.3. Interest on Working Capital ...........................................................................................................40
7.7.4. Depreciation ....................................................................................................................................40
7.7.5. Non-tariff Income ............................................................................................................................41
7.7.6. Summary of ARR and Tariff Proposal for the FY 16-17 to FY 18-19 .............................................41
7.7.7. Actual ARR of FY 2015-16 .............................................................................................................. 42
7.7.8. Annual Revenue Requirement and Proposed Tariff for the FY 2016-17 ..................................... 42
7.7.9. Annual Revenue Requirement and Proposed Tariff for the FY 2017-18 ..................................... 43
7.7.10. Annual Revenue Requirement and Proposed Tariff for the FY 2018-19 ................................... 44
8. ARR for Transmission & Distribution Business of TSECL for MYT Control Period (FY 2016-17
to FY 2018-19) .........................................................................................................................46
8.1. Introduction .............................................................................................................................................. 46
8.2. Category wise Projection for growth in No. of Consumers .................................................................... 46
8.3. Category wise Projection for growth in Sales ......................................................................................... 47
8.4. Transmission and Distribution Loss .......................................................................................................48
8.5. Energy Balance ......................................................................................................................................... 49
8.6. Power Purchase ........................................................................................................................................ 49
8.7. Transmission Charges ...............................................................................................................................51
8.8. O&M Expenses ..........................................................................................................................................51
8.9. Capital Expenditure ................................................................................................................................. 52
8.10. GFA and Depreciation............................................................................................................................ 53
8.11. Interest and Finance Charges................................................................................................................. 56
8.12. Interest on Working Capital................................................................................................................... 56
8.13. Return on Equity and Tax on Return on Equity ................................................................................... 57
8.14. Non-tariff Income................................................................................................................................... 59
8.15. Aggregate Revenue Requirement ..........................................................................................................60
9. Revenue from Operations for FY 2016-17 to FY 2018-19 ..................................................... 61
10. Tariff Design and Proposed Rate Schedule ....................................................................... 62
10.1. Introduction ............................................................................................................................................ 62
10.2. Tariff Structure ....................................................................................................................................... 62
10.3. Proposed Rate Schedule ......................................................................................................................... 64
10.4. New Provisions in Tariff Schedule......................................................................................................... 66
10.5. Proposed Miscellaneous Charges........................................................................................................... 67
11. Revenue Gap for FY 2018-19 .............................................................................................. 70
11.1. Revenue gap at existing tariff.................................................................................................................. 70
11.2. Revenue gap at proposed tariff............................................................................................................... 70
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12. Open Access Charges ......................................................................................................... 72
12.1. Introduction............................................................................................................................................. 72
12.2. Allocation Matrix .................................................................................................................................... 72
12.3. Wheeling Charges ................................................................................................................................... 73
12.4. Cross Subsidy Surcharge ........................................................................................................................ 74
13. Compliance to Directives ................................................................................................... 75
13.1. Introduction............................................................................................................................................. 75
13.2. Adherence to past directives of Hon’ble Commission .......................................................................... 75
13.2.1. Directive 3: Filing Petition for approval of inter-State tariff for Manipur and Mizoram to the
Commission............................................................................................................................................... 75
13.2.2. Directive 4: Annual Performance Report (APR) ......................................................................... 75
13.2.3. Directive 5: Timely filing of ARR & Tariff Petition ..................................................................... 76
13.2.4. Directive 6: Annual Statement of Accounts ................................................................................ 76
13.2.5. Directive 7: Assets and Depreciation Register ............................................................................ 76
13.2.6. Directive 8: Management Information System (MIS)................................................................ 76
13.2.7. Directive 9: Collection of past arrears...........................................................................................77
13.2.8. Directive 10: Transmission and Distribution Loss ......................................................................77
13.2.9. Directive 11: Capital Expenditure Plan .........................................................................................77
13.2.10. Directive 12: AT&C Loss ............................................................................................................. 79
13.3. Adherence to fresh directives of Hon’ble Commission......................................................................... 79
13.3.1. Directive 1: Separate annual accounts for Generation, Transmission, Distribution and SLDC79
13.3.2. Directive 2: Submission of final truing up Petition for years from FY 2009-10 to FY 2012-1380
13.3.3. Directive 3: Submission of Report regarding status of consumer metering and roadmap for
achieving 100% consumer metering........................................................................................................ 81
13.3.4. Directive 4: Submission of minutes of meeting of all distribution circles................................. 81
13.3.5. Directive 5: Conducting internal audit of the Corporations assets / offices..............................82
13.3.6. Directive 7: Tariff Petition for diesel generating station ............................................................82
14. Annexures .........................................................................................................................83
14.1. Proposed Recruitment Plan of TPGL .....................................................................................................83
14.2. Annexure-A: Audited Annual Accounts along with CAG Report .........................................................84
14.3. Annexure-B: Asset Register ...................................................................................................................84
14.4. Annexure-C: Status of Arrears ...............................................................................................................84
14.5. Annexure-D: Minutes of Meeting of distribution circles......................................................................84
14.6. Annexure-E: Internal Audit Report .......................................................................................................84
14.7. Annexure F: DPR of combine cycle conversion of RGTPP & BGTPP and renovation &
modernization/life extension project of GHEP .............................................................................................84
14.8. Annexure G: Copy of fuel bill of ONGC & GAIL for the period Oct 2016 to Dec 2016 .......................84
14.9. Annexure H: Form A: Planned R&M of Rokhia, Baramura and Gumti ..............................................84
14.10. Annexure I: Form F: Plant Characteristics of Rokhia, Baramura and Gumti ...................................84
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List of Tables
Table 1: Plant wise Effective capacity of TPGL ..........................................................................................................15Table 2: Procurement from Central Generating Stations .........................................................................................16Table 10: Summary of Truing Up for the FY 2013-14 (In Lakh)...............................................................................18Table 21: O&M Expenses (Approved vs Actual) Rs. in Lakh ....................................................................................19Table 14: Norms for Interest on Working Capital as Tariff Regulation 2004 .........................................................19Table 14: Calculation of Working Capital and Interest thereon in Rs. Lakhs ..........................................................19Table 10: Original Value of Fixed Assets in Rs. Lakhs .............................................................................................21Table 12: Cost of Capital Works in Progress in Rs. in Lakhs ................................................................................... 22Table 13: Investments in Rs. in Lakhs....................................................................................................................... 22Table 14: Norms for Interest on Working Capital as Tariff Regulation 2004 ........................................................ 22Table 14: Calculation of Working Capital and Interest thereon in Rs. Lakhs ......................................................... 23Table 16: Rate of Depreciation as per Companies Act 1956..................................................................................... 23Table 15: Calculation of Assets created through Grants (Rs. in Lakhs) .................................................................. 24Table 16: Depreciation for the FY 2014-15 (Rs. In Lacs).......................................................................................... 24Table 19: Calculation of Reasonable Return for the FY 2014-15 in Rs. Lakhs ........................................................ 24Table 18: Central Sector Allocation in ISGS.............................................................................................................. 25Table 19: Source wise Power purchase cost .............................................................................................................. 25Table 22: Plant wise fuel cost (Approved vs Actual) ................................................................................................ 26Table 21: O&M Expenses (Approved vs Actual) ........................................................................................................27Table 22: Interest on Loan for the FY 2014-15 (In Lakh) .........................................................................................27Table 23: Sale from Power for the FY 2014-15 ......................................................................................................... 28Table 24: Non-tariff Income & Grant (Approved vs Actual).................................................................................... 29Table 26: Summary of Approved TERC Order for the FY 2014-15 (In Rs. Lakhs)................................................. 29Table 27: Summary of Truing Up for the FY 2014-15 (In Rs. Lakh) ....................................................................... 29Table 3: Actual Plant wise PLF from FY 11-12 to FY 15-16........................................................................................31Table 4: Plant wise Availability %.............................................................................................................................. 32Table 5: Projected PLF and Auxiliary Consumption from FY17 to FY19................................................................. 32Table 6: Plant wise Heat Rate of Past Years ............................................................................................................. 33Table 7: Capital Expenditure from FY 16-17 to FY 18-19 (Rs. lakhs) ...................................................................... 33Table 8: Details of Combine cycle conversion and R&M of GHEP Projects ........................................................... 34Table 9: Original Value of Fixed Assets in Rs. Lakhs ............................................................................................... 34Table 10: Original Value of Fixed Assets in Rs. Lakhs ............................................................................................. 35Table 11: Interest on Working Capital in Rs. Lakhs ................................................................................................. 36Table 12: Calculation of Equity Fund in Rs. Lakhs....................................................................................................37Table 13: Calculation of Pre-tax Return on Equity ....................................................................................................37Table 14: Projected Source wise Supply of Fuel and fuel cost (per SCM) ............................................................... 38Table 15: Fuel consumption and Fuel Cost in Rs. Lakhs.......................................................................................... 38Table 16: O&M Expenses as per Norms .................................................................................................................... 38Table 17: Expected O&M Cost on Planned Repair & Maintenance for the FY 16-17 to FY 18-19 in Rs. Lakhs..... 39Table 18: O&M Cost in Rs. Lakhs .............................................................................................................................. 39Table 19: Rate of Depreciation as per Tariff Regulation .......................................................................................... 40Table 20: Calculation of Assets created through Grants .......................................................................................... 40Table 21: Projected Depreciation (Rs. In Lacs)......................................................................................................... 40Table 22: Summary of Actuals of FY 15-16in Rs. Lakhs........................................................................................... 42Table 23: Summary of ARR of FY 16-17 in Rs. Lakhs............................................................................................... 42Table 24: Proposed Tariff of FY 16-17 in Lacs........................................................................................................... 43Table 25: Summary of ARR of FY 17-18in Rs. Lakhs ............................................................................................... 43Table 26: Proposed Tariff of FY 17-18 in Lacs .......................................................................................................... 44Table 27: Summary of ARR of FY 18-19 in Rs. Lakhs .............................................................................................. 44Table 28: Proposed Tariff of FY 18-19 in Lacs .......................................................................................................... 45Table 1: Projection for growth in Number of Consumers ........................................................................................ 47Table 2: CAGR for projecting growth in sales........................................................................................................... 47Table 3: Projection for growth in Sales ..................................................................................................................... 47Table 4: Projection of T&D Loss for MYT Period ..................................................................................................... 48Table 5: Projection of Energy Balance for MYT Period............................................................................................ 49Table 6: Projection for Power Purchase Cost for MYT Period ................................................................................. 50Table 7: Projection of Transmission Charge for MYT Period ...................................................................................51
Draft MYT Petition for Transmission & Distribution Business of TSECL
Table 8: Projection of O&M Expense for Transmission Business for MYT Period .................................................51Table 9: Projection of O&M Expense for Distribution Business for MYT Period....................................................51Table 10: Projection of Expense Capitalization of Transmission Business of TSECL for MYT Period ................. 52Table 11: Projection of Capital Expenditure of Distribution Business of TSECL for MYT Period......................... 52Table 12: Depreciation Rate as provided in ‘Annexure-8’ of the TERC Regulations (Multi Year Tariff), 2015.... 53Table 13: Depreciation for Transmission Asset calculated as per TERC Regulations (Multi Year Tariff), 2015 .. 54Table 14: Depreciation for Distribution Asset calculated as per TERC Regulations (Multi Year Tariff), 2015 .....55Table 15: IoWC calculation for Transmission Business ........................................................................................... 56Table 16: IoWC calculation for Distribution Business ............................................................................................. 56Table 17: Return on Equity calculation for Transmission Business ........................................................................ 58Table 18: Return on Equity calculation for Distribution Business .......................................................................... 58Table 19: Calculation of Annualized RoE on Pre-tax basis for Transmission Business ......................................... 59Table 20: Calculation of Annualized RoE on Pre-tax basis for Distribution Business........................................... 59Table 21: Non-tariff Income for Transmission Business ......................................................................................... 59Table 22: Non-tariff Income for Distribution Business ........................................................................................... 59Table 23: Aggregate Revenue Requirement for Transmission Business ................................................................ 60Table 24: Aggregate Revenue Requirement for Distribution Business................................................................... 60Table 25: Category wise revenue at existing tariff (Rs. Crores) ................................................................................61Table 26: Category wise revenue at proposed tariff ..................................................................................................61Table 27: Applicability of the Tariff Categories ........................................................................................................ 62Table 28: Proposed Rate Schedule for FY 2018-19 .................................................................................................. 64Table 29: Proposed Rate Schedule for FY 2017-18................................................................................................... 67Table 30: Revenue Gap at existing tariff for MYT Period ........................................................................................ 70Table 31: Revenue Gap at proposed tariff for MYT Period ...................................................................................... 70Table 32: Allocation matrix for separation of ARR for Wires Business and Retail Supply Business .....................72Table 33: Separation of ARR for Wires Business and Retail Supply Business ........................................................73Table 34: Wheeling Charge for 33 kV voltage level ...................................................................................................73Table 35: Calculation of Cost of Supply..................................................................................................................... 74Table 36: Calculation of Cross Subsidy Surcharge ................................................................................................... 74
Draft MYT Petition for Transmission & Distribution Business of TSECL
1. Form -1: PetitionBEFORE THE HON’BLE TRIPURA ELECTRICITY REGULATORY COMMISSION, AGARTALA
File No.
Case No.
IN THE MATTER OF
Filing of the Truing up Petition by Tripura State Electricity Corporation Limited (TSECL) for FY 2013-14 andFY 2014-15 under TERC (Tariff procedure) Regulations, 2004 and the MYT petition from FY 2016-17 to FY2018-19 for generation business and distribution and retail supply business under TERC MYT regulations, 2015along with other guidelines and directions issued by the TERC from time to time and under Section 62 of theElectricity Act, 2003 read with the relevant Guidelines.
AND
IN THE MATTER OF
Tripura State Electricity Corporation Limited (hereinafter referred to as “TSECL” or the “utility”) -PETITIONER.
The applicant respectfully submits hereunder:
1. The power supply industry in Tripura had been under the control of the State Government till 31stDecember 2004. As part of the power sector reforms, Tripura State Electricity Corporation Limited(TSECL) was formed and registered under the Companies Act 1956 on 9th June 2004, in compliancewith the MOU among Ministry of Power, Government of India & Government of Tripura on 28th dayAugust 2003. TSECL was made functional, under section 131 & 133 of the Indian Electricity Act 2003,w.e.f. 1st January 2005 with the operational control of all assets related to Generation, Transmission,Distribution & its allied activities related to power sector of Tripura transferred to TSECL fromGovernment of Tripura. This was done with the objective of improving the efficiency of services in thissector. In continuation with this reforms, Tripura Power Generation Limited (TPGL) has beenconstituted and all assets relating to Generation projects owned by TSECL is being transferred to TPGLwith effect from 1st April 2016. However, the demerger of TPGL from TSECL as per provisions ofCompanies Act 2015, is still in progress, post which the independent functioning of TPGL shallcommence. As such, a combined petition for generation and distribution is being filed by TSECL tillsuch stage.
2. The Hon’ble Commission in exercise of power conferred under section 181 of The Electricity Act 2003and all other powers enabling in this behalf issued the TERC Tariff Regulation 2004, TERC Tariff Procedure Regulation 2004. TERC Conduct of Business Regulation 2004.
3. The present tariff petition is being filed in accordance with the relevant provision of the abovementioned regulations as well as that of Electricity Act 2003 and National Tariff Policy.
4. This petition includes the True-up for the FY 2013-14 and FY 2014-15 and the MYT petition of FY 2016-17 to FY 2018-19 for generation and distribution business along with tariff proposal of FY 2017-18.Under the TERC MYT regulations 2015, TSECL proposes that the first control period should be forthree years i.e. from FY 2016-17 to FY 2018-19. Also, TSECL craves leave of the Commission forsubmitting the audited annual accounts of FY 2015-16 as the statutory audit of FY 2015-16 is in processand the same shall be submitted to the Hon’ble Commission as and when the audit is completed.
5. TSECL along with this petition is submitting the supporting/ supplementary data & informationavailable and shall further make available the same to the extent available with TSECL as may berequired by the Hon’ble Commission during its processing.
Prayer
TSECL respectfully prays that the Hon’ble Commission may:
a. Admit this Petition;
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b. Examine the proposal submitted by the Petitioner for a favorable dispensation as detailed in the enclosedproposal;
c. Consider the submissions and allow the proposed Truing up for FY 2013-14 to FY 2014-15 and MYTprojections of FY 2016-17 to FY 2018-19for generation and distribution business along with tariff proposalfor FY 2018-19;
d. Pass suitable orders for implementation of the tariff proposal;e. Approve the terms and conditions of tariff and various other matters as proposed in this petition and the
proposed changes therein.f. Condone any inadvertent omissions/ errors/ shortcomings and permit TSECL to add/ change/ modify /
alter this filing and make further submissions as may be required at a future date.g. Pass such orders as the Hon’ble Commission may deem fit and proper, keeping in view the facts and
circumstances of the case;
(Er. Arup Gan Chaudhuri)
Deputy General Manager
Commercial & Tariff
For and on behalf of
Tripura State Electricity Corporation Limited (TSECL)
Dated: ______, 2018
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3. Summary of Petition
3.1. Preamble1. Tripura State Electricity Corporation Limited (TSECL) has been created from the Department of Power,
Government of Tripura and started its operation from 1stJanuary, 2005. TSECL was the sole electricity
utility in Tripura responsible for generation, transmission and distribution of electricity in the State.Now,
new company named Tripura Power Generation Limited (TPGL) has been formed with all
generation assets of TSECL with effect from June, 2015. TPGL which is now responsible for the State
generationstarted functioning as an independent entity from September 2016.However, the demerger of
TPGL from TSECL as per provisions of Companies Act 2015, is still in progress, post which the
independent functioning of TPGL shall commence. As such, a combined petition for generation and
distribution is being filed by TSECL till such stage.
2. The Government of Tripura (GoT) vide notification dated 24thJuly, 2007, notified the final opening
balance of the assets of TSECL with effect from January 1st 2005. As per this notification of Government
of Tripura, Rs. 636.35 Crore worth of Fixed Assets and Rs. 18.39 Cr. of worth of current assets (after
netting off current liabilities of Rs. 44.17 Crore) transferred to TSECL from the Department of Power,
GoT. The authorised Capital of TSECL increased from Rs. 10.00 Crore to Rs. 120.00 Crore. TSECL
increased its issued, subscribed and paid-up share capital from Rs. 9.55 Crore to Rs. 109.29 Crore for
consideration of other than cash by way of conversion of capital reserve amounting to Rs. 9.50 Crore and
conversion of Department of Power loan amounting to Rs. 90.24 Crore.
3.2. Procedural History1. The Tripura State Electricity Corporation Limited had filed its first Tariff Petition for the FY 2005-06 in
accordance with the Tripura Electricity Regulatory Commission (Tariff Procedure) Regulation 2004, and
Tripura Electricity Regulatory Commission (Tariff) Regulation 2004 (hereinafter referred to asTERC
Tariff Regulations, 2004). The Tripura Electricity Regulatory Commission (hereafter referred as ‘the
Hon’ble Commission), in exercise of the powers vested under Sections 61, 62 and 64 of the Electricity Act,
2003 carried out a detailed review of Petition submitted by TSECL.
2. The Hon’ble Commission examined the Petition and other submissions made by TSECL along with
solicited views of the public representatives on the Petition submitted by TSECL. After a thorough
examination of the Petition and Public comments and suggestions, the Hon’bleCommission issued its
first Tariff Order on 24th June 2005.
3. The TSECL submitted its second ARR and Tariff Petition for FY 2006-07 on 4thAugust, 2006 and
subsequently the Hon’ble Commission issued its second Tariff Order on 14thSeptember, 2006.
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4. From FY 2007-08 to FY 2010-11 TSECL had not filed any ARR Petition. In FY 2010-11, TSECL submitted
a Petition for Fuel & Power Purchase Cost Adjustment (FPPCA) for approval of adjustment of cost against
increase in fuel (gas) cost for its own generating stations at Rukhia and Baramura and cost incurred for
procurement of power from the Central Generating Stations (CGSs). The Hon’bleCommission after due
examination of the Petition and considering all the aspects in this matter, issued FPPCA Order on 13th
September, 2010. The Hon’bleCommission also issued an amendment to the saidOrder on 22nd
September, 2010 after allowing subsidy to some categories of consumer.
5. Further, the TSECL submitted the Petition for ‘Truing-Up’ for the period FY 2007-08 to FY 2010-11 and
determination of Aggregate Revenue Requirement (ARR) for FY 2012-13 on 20th January, 2012. In this
regard, the Hon’bleCommission passed its first True-Up Order for FY 2007-08, FY 2008-09, FY 2009-10
and FY 2010-11 on 28th March, 2012. The Order also included review of ARR for FY 2011-12 and
determination of ARR and tariff for FY 2012-13.
6. Subsequently on 15th March, 2013, the Hon’ble Commission approved the provisional True-Up for FY
2011-12, Review for FY 2012-13 and ARR and Tariff Order for FY 2013-14. Thereafter, the Hon’ble
Commission also issued an Order with regard to True-Up for FY 2012-13, Review of FY 2013-14 and
determination of Tariff for FY 2014-15 on 22nd November, 2014.
3.3. Current Petition1. Section 62 of the Electricity Act, 2003 mandates the utility to furnish details as may be specified by the
State Electricity Regulatory Commission for determination of tariff. In addition, as per the Regulations
issued by the Hon’ble Commission, TSECL is required to file Petition for all reasonable expenses which it
believes would incur over the next financial year and seek the approval of the Hon’ble Commission for the
same. The filing is to be done based on the projections of the expected revenue and costs.
2. In compliance of this regulatory obligation, TSECL hereby files True-Up Petition for FY 2013-14 and FY
2014-15 and ARR & Tariff Petition for the MYT Control Period of FY 2016-17 to FY 2018-19 for generation
business and distribution &retail supply business separately. TSECL craves leave of the Commission in
submission of audited accounts for FY 2015-16 along with this petition as the audit of FY 2015-16 is in
progress. The audited accounts shall be submitted as and when the audit is completed.
3. The current petition has been prepared in accordance with the provisions of the following
Acts/Policies/Regulations:
1. Electricity Act 2003;
2. National Electricity Policy;
3. National Tariff Policy issued from time to time;
4. Tripura Electricity Regulatory Commission (Tariff Regulations) 2004 and
5. Tripura Electricity Regulatory Commission Tariff Regulations (Multi Year Tariff), 2015
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4. TSECL has made genuine efforts for compiling all relevant information relating to the True-up Petition as
required under the Regulations issued by the Hon’ble Commission and has also made every effort to
ensure that information provided to the Hon’ble Commission is accurate and free from material errors.
However, there may be certain deficiencies owing to the limitations of the management information
systems of the TSECL. Hence, TSECL prays before the Hon’ble Commission that the information
provided be accepted for the current filing and at the same time TSECL assures that it is taking
appropriate measures to improve its management information system for improved data collection.
5. Accordingly, TSECL prays before the Hon’ble Commission to admit &process this ARR/ Tariff Petition,
allow for proposed schedule of tariff to be charged by TSECL in its areas of operation for FY 2018-19.
3.4. Contents of the PetitionThis petition comprises of following main sections namely:
1. Review of the Power Sector of Tripura;
2. True-Up Petition for FY 2013-14;
3. True-Up Petition for FY 2014-15and
4. Annual Revenue Requirement (ARR) and Tariff Petition for MYT Control Period of FY
2016-17 to FY 2018-19 for Generation business and Distribution & retail supply
Businessseperately.
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4. Power Sector Overview
4.1. About the State of Tripura6. Tripura is a land locked state in the Northeast India whichis
bounded on the north, west, south and southeast by
Bangladesh, whereas in the east, it shares a common boundary
with Indian states of Assam and Mizoram. It was formally
declared as Union Territory on 1 November, 1957 and was
elevated to the status of a full-fledged state on 21 January, 1972.
The state lies approximately between latitude 220 56' and 240
32' north and longitude 910 10' and 920 21' east. For
administrative convenience and decentralization of power, Tripura which was once a single district is now
divided into altogether eight districts. Between 2004-05 and 2015-16, Gross State Domestic Product
(GSDP) expanded at a Compound Annual Growth Rate (CAGR) of 9.13 per cent to USD 5.20 billion
whereas the Net State Domestic Product (NSDP) expanded at a CAGR of 8.50 per cent to USD 4.47
billion.
7. The state has a population of 36.74 lakhs according to 2011 census and spread over 10,490 sq km.
Although Tripura is the 2nd smallest state in India, it is the 2nd most populous state in North eastern
region and has the 2nd highest population density in the north east region (NER)1. The per capita income
in the state stands around INR 36000 in comparison to national average of around INR 54500. About 83
% of the state’s population lives in rural areas.Agriculture and allied activities form the backbone of the
economy of Tripura and employ about 64% of the population.
4.2. Background of TSECL8. The power supply Industry in Tripura had been under the direct control of the State Government till
2004. Before 31st December 2004, all the functions in power sector like generation, transmission,
distribution of electricity were entrusted on Department of Power, Government of Tripura. As a part of
power sector reforms, Tripura State Electricity Corporation Limited (TSECL) was formed and registered
under the Companies Act 1956 on 9th June 2004 in compliance with the MOU between Ministry of
Power, GOI and Govt. Tripura on 28th August, 2003. TSECL was made functional under section 131 & 133
of the ElectricityAct, 2003 w.e.f. 1st January, 2005 with the operational control of all assets related to
Generation, Transmission & Distribution.
9. Recently, a generation company in the name of “Tripura Power Generation Limited” (TPGL)has been
constituted and all assets related to Generation Project owned by TSECL is being transferred to TPGL.
The remaining functions of electricity transmission and distribution are still lying with TSECL.However,
1http://www.censusindia.gov.in/
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the demerger of TPGL from TSECL as per provisions of Companies Act 2015, is still in progress, post
which the independent functioning of TPGL shall commence.
4.3. Generation Overview10. In spite of severe geographic and infrastructure constraints, Tripura has made a significant progress in its
capacity addition programme. The state had reached a generation capacity of 2.5 MW (composed of onlydiesel generation units) by the end of 4th 5-year plan, from its pre-independence generation of 30 kW. In5th and 6th five year plans, rain-fed hydro generation has been added in Gumti with the first two units (5MW each) commissioned in 1976 and another 5 MW unit added in 1984.
11. The exploration of oil and natural gas, which are the most important mineral resources in Tripura, hasled to a new chapter in Tripura power sector. Two 5 MW gas-based generation units at Baramura havebeen installed in 1986 followed by 6.5 MW unit in 1990 with funding by North-East Council (NEC). Also,two 8 MW gas-based generation units have been commissioned at Rokhia in 1990 followed by two more 8MW units in the later half of the 8th 5-year plan. Further, augmentation has been done at Rokhia by 16MW (2x 8 MW) with funding of NEC. Larger units (21 MW) have been installed both in Rokhia andBaramura Gas thermal power plants after 2000 to enable greater efficiency in operation.
12. Different details of generation units and their status is summarized below:
Table 1: Plant wise Effective capacity of TPGL
Name ofGenerationstation
Unit Capacity(MW)
De ratedCapacity(MW)
Year ofInstallation Status
Gomuti Hydro-electric Project(GHEP)
Unit-I 5
10
June 1976Only 2 units of 5MW each run at atime and the 3rd unit is kept asstand by
Unit-II 5 February 1977
Unit -III 5 January 1984
Sub-total 15 10
Baramura GasThermal PowerPlant (BGTPP)
Unit-IV* 21 21 27th Nov 2002 In operation
Unit-V* 21 21 3rd August 2010 In operation
Sub-total 42 42
Rokhia GasThermal PowerPlant (RGTPP)
Unit-VII 21 21 24th Sept 2002
In operationUnit-VIII 21 21 30th Mar 2006
Unit-IX 21 21 28th Aug 2013
Sub-total 63 63
Total 120.0 115.0
Till 31st Dec 2004G-T-D under control of
State Govt.
June 2004Incorporation of TSECL
January 2005Operational
commencement of TSECL
June 2015Incorporation of TPGL
with all Generation assetsof TSECL
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*50% of generation to be shared with Manipur and Mizoram as per financial arrangement with NEC
13. As seen from the above table, 70.35 MW capacity is not operational and in case of Gomuti only2 units of5MW each run at a time and the 3rd unit is kept as stand by on rotation basis as the water content allowsrunning only two units at a time. Out of total state capacity, only around 94MW is available for the stateof Tripura after adjusting the non-working units and the share of Manipur and Mizoram.
14. To meet the demand, the state also depends on the allocation of energy from central generating stations.There is no privately owned generation plant in Tripura.
Table 2: Procurement from Central Generating Stations
Details of generatingstation Ownership Installed
Capacity (MW)Allocation (MW) Power
Taken in FY16-17 (MW)Peak Off-Peak
Palatana Gas based Powerplant, Gumti district
ONGC TripuraPower Company 726.6 196.00 196.00 142.02
NEEPCO Gas & HydroPlants NEEPCO 1276 200.56 190.95 120.00
NHPC Loktak HPS NHPC 105 12.93 12.10 12.52
NTPC, BGTPP (Thermal) NTPC 250 20.76 18.70 17.00
15. In order to enhance its own generation and improve the efficiency of generation, TPGL has plans ofconverting the existing open cycle operation of Rokhia and Baramura gas based plants to combined cyclemode. Further, the Renovation and Modernization/ life extension project of 3X5 MW GHEP is alsoplanned to be taken up immediately. Since pre-project activities and fund tie up is not completed yet,hence, expected benefits from the implementation of these projects has not been considered in thisdocument as these projects are expected to be complete after the end of control period. However, theabove mentioned projects is expected to be initiated within the control period and TPGL is currentlyexploring various options for tying up the funding arrangements for the project.
4.4. Transmission & Distribution Overview16. In spite of severe geographic and infrastructure constraints, Tripura has made a significant progress in its
capacity addition programme. In order to match the growth in generated capacity to meet the increase in
demand within the state, there has been a corresponding augmentation and upgradation in the
transmission and distribution sector. The intra-state transmission system has been planned at both 132
kV and 66 kV lines to evacuate power from the generating stationswhich is supported by downstream
distribution network of 33 kV, 11 kV and LT lines.
17. The power evacuation system of Gumti Hydro Electric Project (GHEP) is composed of 66 kV lines
emanating to Agartala via Amarpur&Teliamura via Udaipur. Generation from Rokhia Gas Thermal Power
Plant (RGTPP)&Baramura Gas Thermal Power Plant (BGTPP) is evacuated to the load centres of
Agartala, Badharghat, Udaipur, and Teliamura, Ambassa etc. by transmission systemconstituted of both
66 kV and 132 kV lines.
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05000
10000150002000025000
FY 11 FY 12 FY 13 FY 14 FY 15
Growth in T&D Network (ckt. km.)
66 &132 kV 33 kV 11 kV LT
18. The state is connected to other states of Northeastern region through 132 kV Kumarghat- Badarpur single
circuit(S/C) line, 132 kV Dharmanagar – Dullavcherra single circuit (S/C) line, 132 kV Kumarghat-
Aizawl single circuit (S/C) line, 400kV Silchar- P. K. Bari Double circuit (D/C) line (operated at 132 kV)
and 400 kV Palatana- Silchar double circuit (D/C) lines.
19. TSECL currently owns around 22,937 ckt km of Low Tension (LT) lines, around 14,320 ckt km of 11 kV
lines andmore than 1,705 ckt km of 33 kV and above lines. The voltage-wise growth in ckt km for T&D
network and rise indistribution transformation capacity (MVA) of TSECL shows that growth has mainly
happened in the LT & 11 kVnetwork showing the focus on distribution system augmentation to increase
access of supply to rural and remoteareas.
The total transformation capacity (MVA) at different transmission voltage levels of different substations
is asshown below:
Sl. No. VoltageLevel (kV)
TransformationCapacity (MVA)
1. 132/66 30
2. 132/33 325
3. 132/11 90
4. 132/33/11 45
5. 66/33 90.3
6. 66/11 125.8
7. 66/33/11 4
Total 710.1
0.00
200.00
400.00
600.00
800.00
1,000.00
FY 11 FY 12 FY 13 FY 14 FY 15
Distribution Transformation Capacity(MVA)
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5. True Up for FY 2013-14
5.1. Introduction1. The regulatory provisions of Electricity Act 2003, specifies that the Hon’ble Commission shall undertake
the True-up of Aggregate Revenue Requirement (hereinafter referred as “ARR”) of utility for the periodbased on the comparison of the actual performance of the year with the approved estimate for thatperiod. In line with the provisions of TERC Tariff Regulations, 2004, TSECL has filed this True-uppetition for the year FY 2013-14. The TSECL presents its submissions for the purpose of true-up for thefinancial year 2013-14 as per the audited Annual Accounts for the year. The audited annual accounts forthe period FY 2013-14are also being submitted to the Hon’ble Commission along with this petition for thepurpose of true up in the Annexure A. TSECL already filed the Review petition of ARR for the FY 2013-14on 23rd July 2014 and it was approved by TERC on 22nd November 2014.
2. TSECL craves leave of the Commission for submission of item wise details for the truing up of FY 2013-14as the same has already been undertaken in the last tariff order issued by the Commission on 22nd
November 2014. The approved ARR for the FY 2013-14 and proposed ARR in Review petition are tabledbelow:
Table 3: Summary of Truing Up for the FY 2013-14 (In Lakh)
Particulars Approved inOrder dated25.06.2013
Review of FY2013-14dated22.11.2014
Petitioner'ssubmission fortruing up of FY2013-14
Gap
A B C D=C-B
Fuel cost 18,798.0 17,826.0 19,450.0 1,623.5
Power purchase cost 22,465.0 21,819.0 22,996.2 1,177.2
O&M expense 13,525.0 14,471.0 15,411.0 9,40.0
Depreciation 2,431.0 2,155.0 2,369.2 2,14.2
Interest on working capital - - 1,321.2 1,321.0
Interest and finance charges 34.0 - - 0.0
Reasonable Return 1,652.0 3,103.0 3,389.9 286.9
Prior Period (Power Purchase) 4,243.0 4,243.0
Aggregate RevenueRequirement (ARR) 58,905.0
59,374.069,179.8
9,805.8
Less: non-tariff income 4,201.0 3,540.0 4,664.0 1,124.0
Net Aggregate RevenueRequirement 54,704.0 55,834.0 64,515.8 8,681.8
Revenue from sale of Power 56,103.0 49,884.0 47,570.4 (2,313.6)
Revenue subsidy from GoT - 4,000.0 4,000.0 0.00
Revenue Gap/(Surplus) (1,399.0) 1,950.0 12,945.4 10,995.4
3. This section outlines the performance of TSECL those factors which are deviated from Approved Reviewpetition for the FY 2013-14. In line with the provisions of the Tripura Electricity Regulatory Commission(Tariff Regulations) 2004, the TSECL hereby submits the true-up petition for FY 2013-14 based on theaudited annual accounts for FY 2013-14.
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5.2. O&M Expenses4. Operation and Maintenance expenses of TSECL includes following major heads:
Employee Cost:Employee expenses comprise of salaries, dearness allowance, bonus, terminalbenefits in the form of pension & gratuity, leave encashment and staff welfare expenses.
Repair & Maintenance expenses:Regular Repair and Maintenance of the electrical system aswell as the civil and IT infrastructure is critical for operating the system and ensuring that assets areable to serve for complete expected life.
Administration and General (A&G) Expenses:The A&G expenses of TSECL mainly coverexpenses for administrative requirements like telephone, electricity, vehicles lease, statutory taxes tobe paid etc. and payment of outsourced agencies like statutory auditors, legal charges, consultancyfees etc.
5. It is to be noted that O&M expenses of TSECL for the FY 2013-14 is more or less close to approved O&Mexpenses as shown in table below. There is a slight increase in the figures of R&M expenses and A&Gexpenses from the approved figures which were based on provisional accounts:
Table 4: O&M Expenses (Approved vs Actual) Rs. in Lakh
Name of Generation station Approved by TREC inTariff order dated22.11.2014
Petitioner'ssubmission fortruing up of FY 2013-14
Employee Cost 10,175.9 10,175.9Repair & Maintenance 2842.0 3,599.9A&G 1451.0 1,635.1Total O&M Expenses 14471.9 15,411.0
5.3. Interest on Working Capital6. The working capital is estimated for calculating the normative interest charges to be allowed for financing
the working capital requirements. As per TERC Regulations (Tariff) 2004, the working capital normshave been defined separately for generation, transmission and distribution functions, as given below:
Table 5: Norms for Interest on Working Capital as Tariff Regulation 2004
Description Generation Transmission DistributionNorms for calculation ofWorking Capital
One and Half Months ofsales for generation (45days)
One and Half Months ofsales for transmission (45days)
Two months of sales fordistribution business(60 days)
7. The sales for generation, transmission and distribution have been estimated based on the totalexpenditure of all the generation accounting divisions, transmission accounting divisions and distribution& other accounting divisions. For this calculation, interest is taken as per average SBI PLR rate for FY2013-14. The normative working capital requirements as per TERC regulations, is tabulated below:
Table 6: Calculation of Working Capital and Interest thereon in Rs. Lakhs
Sr.No.
Particulars % of AssetsBreak up
Norms ofWorking
Capital (InDays)
ARR Value(Allocated
in AssetsRatio)
Petitioner'ssubmission fortruing up of FY
2013-141 Generation 32.82% 45 20,345.1 2,508.32 Transmission 22.38% 45 13,875.8 1,710.73 Distribution 44.79% 60 27,766.4 4,564.34 TOTAL 8,783.4
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Sr.No.
Particulars % of AssetsBreak up
Norms ofWorking
Capital (InDays)
ARR Value(Allocated
in AssetsRatio)
Petitioner'ssubmission fortruing up of FY
2013-145 Interest Rate (@ SBI PLR on 1st
April 2014)14.45%
6 Normative Interest on WorkingCapital @ the average SBI PLR
1,269.2
7 Interest on Working Capitalapproved as per Tariff Orderfor FY 2013-14
0.0
8. It may be noted that the working capital is a normative cost and should be allowed even though actualloans have been taken or not. This is because even if TSECL had not taken any loans for working capitalin FY 2013-14, it had managed the working capital requirements because of availability of funds fromother schemes like deposit works, capital expenditure schemes, fixed deposits from accumulated profitsof past years etc. which resulted in lower non-tariff income.
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6. True Up for FY 2014-15
6.1. Introduction9. The regulatory provisions of Electricity Act 2003, specifies that the Hon’ble Commission shall undertake
the True-up of Aggregate Revenue Requirement (hereinafter referred as “ARR”) of utility for the periodbased on the comparison of the actual performance of the year with the approved estimate for thatperiod. In line with the provisions of TERC Tariff Regulations, 2004, TSECL has filed this True-uppetition for the year FY 2014-15. The TSECL presents its submissions for the purpose of true-up for thefinancial year 2014-15 as per the audited Annual Accounts for the year. The annual accounts for theperiod FY 2014-15are also being submitted to the Hon’ble Commission along with this petition for thepurpose of true up in the Annexure A. This section also outlines the performance of TSECL during FY2014-15.
10. In line with the provisions of the Tripura Electricity Regulatory Commission (Tariff Regulations) 2004,the TSECL hereby submits the true-up petition for FY 2014-15 based on the annual accounts of FY 2014-15. Accordingly, revised Aggregate Revenue Requirement, revenue and consequent Gap with carryingcosts for the period FY 2014-15 are provided in the following paragraphs of this section.
11. TSECL requests the Hon’ble Commission to consider the information submitted in this petition and inthe formats and allow true-up of expenses as prayed in this petition.
6.2. Asset Base and Capital Expenditure12. This section details the gross value of fixed assets available for use and necessary for the purpose of
generation transmission and distribution (G-T-D) business at the end of each financial year. In order toshow the break-up of G-T-D assets, the following method has been used in the absence of segregatedaccounts.
13. In TSECL, the account statements are prepared by consolidation of account figures of different businessunits/divisions. These divisions are of five categories, namely generation, transmission, distribution,corporate and other divisions. For the purpose of segregation of assets, it has been assumed that the assetbase of generation, transmission and distribution divisions is equal to generation, transmission anddistribution assets respectively and the asset base of corporate and other divisions have been allocatedamong generation, transmission and distribution. The booked value of assets in TSECL accounts includethe assets created out of government grants and consumer contribution. The value of assets created out ofgovernment grants has been estimated based on the amount of capital grants received and value of fixedassets in books. Based on the above, the value of the gross value of assets and the asset base forcalculation of depreciation is tabulated below:
Table 7: Original Value of Fixed Assets in Rs. Lakhs
S. No. ParticularsPetitioner's
submission for truingup of FY 2014-15
1 Generation Assets 31,926.12
2 Transmission Assets 21,761.46
3 Distribution Assets 48,913.55
GROSS TOTAL 102,601.13
5 Assets created through Government Grants53,826.21
Total Asset Base for Depreciation48,774.92
6 Cost of intangible assets, if any-
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14. The gross value of the asset base has increased based on the various capital expenditure schemesundertaken by TSECL based on the approved schemes of Central Government as well as StateGovernment for capacity augmentation, system strengthening, rural electrification and reduction oflosses.
6.3. Capital Work In Progress15. Details of the year wise value of capital works in progress for generation, transmission, distribution and
other works is tabulated below. It is submitted that since the funding of the capital schemes is in the formof grants and interest free loans, there is no interest charges being incurred on long term loans and assuch no interest charges have been capitalized because of interest incurred during progress of projects.
Table 8: Cost of Capital Works in Progress in Rs. in Lakhs
S. No. Particulars Petitioner's submission for truing up of FY 2014-151 Generation Works 100.0
a RGTPP -
b BGTPP 100.0
c Gomuti -
2 Transmission Works 8,374.01
3 Distribution Works 9,002.09
4 Other Works 4,098.96
TOTAL 21,575.06
6.4. Investments16. TSECL has made investments in the form of fixed deposits with various banks. A majority of such
investments have been made from the accumulated cash profits earned by TSECL and funding receivedfrom deposit works. The income earned from such investments in the form of interest is being separatelybooked under other income category. The investment and income earned from it are tabulated below:
Table 9: Investments in Rs. in Lakhs
S No. Closing Balance of Investments Petitioner's submission fortruing up of FY 2014-15
1 Fixed Deposit as per annual accounts 24,360.882 Interest received on Fixed Deposit and booked under Other Income 2,547.45
6.5. Working Capital and Interest17. The working capital is estimated for calculating the normative interest charges to be allowed for financing
the working capital requirements. Owing to the deteriorating financial health of the Corporation, TSECLis in dire needs of funds to meet the working capital and hence it is claiming interest on working capitalon normative basis as given in Tariff Regulation 2004.
18. The working capital is estimated for calculating the normative interest charges to be allowed for financingthe working capital requirements. As per TERC Regulations (Tariff) 2004, the working capital normshave been defined separately for generation, transmission and distribution functions, as given below:
Table 10: Norms for Interest on Working Capital as Tariff Regulation 2004
Description Generation Transmission DistributionNorms for calculation ofWorking Capital
One and Half Months ofsales for generation (45days)
One and Half Months ofsales for transmission (45days)
Two months of sales fordistribution business(60 days)
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19. The sales for generation, transmission and distribution have been estimated based on the totalexpenditure of all the generation accounting divisions, transmission accounting divisions and distribution& other accounting divisions. For this calculation, interest rate for calculation of interest on workingcapital is taken as per average SBI PLR rate for FY 2014-15. The normative working capital requirementsas per TERC regulations, the normative interest component on same and actual interest incurred forworking capital is tabulated below:
Table 11: Calculation of Working Capital and Interest thereon in Rs. Lakhs
Sr.No.
Particulars % of AssetsBreak up
Norms ofWorking
Capital (InDays)
ARR Value(Allocated
in AssetsRatio)
Petitioner'ssubmission
for truingup of FY2014-15
1 Generation 31.12% 45 24,734.0 3,049.02 Transmission 21.21% 45 16,859.0 2,079.03 Distribution 47.67% 60 37,895.0 6,229.04 TOTAL 11,357.05 Interest Rate (@ SBI PLR on 1st
April 2014)14.75%
6 Normative Interest on WorkingCapital @ the average SBI PLR
1,675.0
7 Interest on Working Capitalapproved as per Tariff Orderfor FY 2014-15
0.0
6.6. Depreciation20. For the calculation of depreciation, the depreciation rates have been takenfrom Companies Act
1956/TERC Tariff Regulations 2004 under the Straight Line Method on the gross asset value and nodepreciation is claimed on assets created out of government grants. However, in account statementdepreciation have been calculated as per depreciation rate provided in Companies Act 2013.
Table 12: Rate of Depreciation as per Companies Act 1956
Particulars Depreciation RateLand 0.00%Building 2.49%Plant & Machinery 5.28%Computer 16.21%Computer and Office Equipment 16.21%Furniture 6.33%Vehicles 9.50%
21. As already mentioned above, the gross asset base booked in account statements includes assets createdout of government grants. However, in accordance with accounting procedures as well as regulatorypractices in other states, depreciation on such assets has not been claimed to be recovered through tariffand ARR. The gross asset value as per the account statements and the gross asset value excluding assetscreated through grants have been mentioned earlier in Table 7. Further, the assets which have completelydepreciated have also been deducted from the total gross value of assets shown in account statements forthe purpose of calculation of depreciation. The calculation of assets created through grants is providedbelow:
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Table 13: Calculation of Assets created through Grants (Rs. in Lakhs)
Particulars AmountGrants for creation of assets (as per accounts statement 2014-15) 53,826.21Fixed Assets Value including CWIP (as per accounts statement 2014-15) 102,601.13% of Assets created through Grants 52.5%
22. Category wise depreciation calculation are tabled below:
Table 14: Depreciation for the FY 2014-15 (Rs. In Lacs)
Particulars Petitioner's submission for truing up of FY 2014-15Land -Building 79.87Plant & Machinery 4,087.64Furniture 9.75Computer &Office Equipment 78.54Vehicles 2.62
Total 4,258.42Less: Depreciation on Assets acquired through Grant 2,234.04
Net Depreciation 2,024.38
6.7. Reasonable Return23. As per TERC tariff regulations 2004, (clause 2 of Schedule -1 and 3) return on generation and distribution
business is defined as, “the reasonable return for this purpose means 5% above the RBI rate or 3% abovethe PLR rate of State Bank of India or average of any other three approved Nationalized Bank whicheveris higher and calculated on the subscribed and paid up equity capital which shall also include SharePremium Balance for this purpose but shall not include Bonus Shares or Shares issued other than forcash.”
24. Similarly, for reasonable return on transmission business, TERC tariff regulations 2004 (Clause 2 ofSchedule 2) states that, “the reasonable returnfor this purpose means 4% above the RBI rate or 2%above the PLR rate of State Bank of India or average of any other three approved Nationalized Bankwhichever is higher and calculated on the subscribed and paid up equity capital which shall also includeShare Premium Balance for this purpose but shall not include Bonus Shares or Shares issued other thanfor cash.”
25. It is observed that the SBI PLR rate as on 01.04.2014 was 14.75% thus for calculation of reasonablereturn, the rate of return for overall paid-up equity capital has been assumed to be 17.75% i.e. 3% overSBI PLR for Generation and Distribution business and 16.75% for Transmission business.
26. In order to calculate the reasonable return amount for generation, transmission and distributionbusiness, the total paid-up equity capital for TSECL is divided into paid-up equity for generation,transmission and distribution in the ratio of total net asset base for generation, transmission anddistribution business, the values of which are already provided under Table 7.
27. It may be noted that the Commission in its past orders had considered equity base for the generationprojects as 30% of the Gross Fixed Asset Value and as such the same is considered here for the purpose ofcalculation of reasonable return. The calculation of reasonable return are provided below:
Table 15: Calculation of Reasonable Return for the FY 2014-15 in Rs. Lakhs
Particulars Approved by TREC in Tariff orderdated 22.11.2014
Petitioner's submission fortruing up of FY 2014-15
AverageEquity
InterestRate
ReasonableReturn
AverageEquity
InterestRate
ReasonableReturn
Generation 6195.0 15.23% 944.0 7,563.8 17.75% 1,342.6
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Particulars Approved by TREC in Tariff orderdated 22.11.2014
Petitioner's submission fortruing up of FY 2014-15
AverageEquity
InterestRate
ReasonableReturn
AverageEquity
InterestRate
ReasonableReturn
Transmission 1876.0 14.23% 267.0 5,155.6 16.75% 863.6Distribution 12399.0 14.23% 1888.0 11,588.3 17.75% 2,056.9Total 3099.0 5,398.2
6.8. Expenditure6.8.1. Power Purchase Cost28. TSECL is currently purchasing power from central generating stations of NEEPCO, NHPC and OTPC
Palatana in which Tripura is having allocated share/ allocation of power. The central sector allocationsand power purchase from ISGS (Inter-state Generating Stations) in the FY 2014-15 are given below:
Table 16: Central Sector Allocation in ISGS
S.No Name of Generationstation Owner
Installedcapacity(MW)
Tripura Share Actual for FY2014-15
Percent MW MU
1. LoktakHydro-ElectricPower station (HEP)
NHPC 105 11.92% 12.52 41.51
2. Khandong HEP NEEPCO 50 5.75% 2.88 4.85
3. Kopiliplus KopiliextnHEP NEEPCO 200 6.08% 12.16 31.25
4. Kopili-stage II NEEPCO 25 9.53% 2.38 7.55
5. Assam Gas Based Powerplant (AGBPP) Kathalguri
NEEPCO 291 6.95% 20.22 111.58
6. Agartala Gas TurbinePower Plant (AGTPP)
NEEPCO 84 18.60% 15.62 101.59
7. Doyang HEP NEEPCO 75 7.07% 5.30 10.82
8. Ranganadi HEP NEEPCO 405 7.57% 30.66 81.97
9. OTPC Palatana OTPC 526 27.00% 142.02 655.81
Total 1761 13.84% 243.76 1046.52
29. The power purchase rates for these CSGS and the associated transmission charges paid to PGCIL fortransmission of power to state bus of Tripura, are governed by CERC tariff regulations and areuncontrollable by TSECL. The actual power purchase cost along with approved cost are tabulated below:
Table 17: Source wise Power purchase cost
Particulars
Approved by TREC in Tarifforder dated 22.11.2014 Actual for FY 2014-15
(MU)Cost (InCr.) Rs./kwh (MU) Cost (In
Cr.) Rs./kwh
NEEPCO 365.28 122.62 3.36 349.204 117.22 3.36
NHPC 71.72 18.49 2.58 41.506 13.83 3.33
OTPC Palatana 700.80 179.28 2.56 655.811 172.20 2.63
Total Power Purchase Cost 1137.80 320.38 2.82 1046.520 303.24 2.90
PGCIL Charges 37.51 42.99
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Particulars
Approved by TREC in Tarifforder dated 22.11.2014 Actual for FY 2014-15
(MU)Cost (InCr.) Rs./kwh (MU) Cost (In
Cr.) Rs./kwh
POSOCO 1.14 0.00
Supplementary bills raised byNEEPCO, NHPC, PGCIL etc.
61.98
Total Power Purchase Cost 359.03 408.20
6.8.2. Fuel Cost30. The only fuel used by TPGL for self-generation of energy is natural gas. The natural gas is being sourced
from the reserves at Rokhia, Baramura and Konabanpartly under the Average Price Mechanism (APM) atthe rates notified by the Ministry of Petroleum and Natural Gas (MoP&NG), Government of India andpartly at the Market Determined Price (MDP). TPGL has allocations of 0.58 MMSCMD and 0.40MMSCMD under the APM gas mechanism for its generation plants at RGTPP and BGTPP respectively.
31. Other than the APM gas allocations, TPGL also purchased some quantity of gas under MarketDetermined Price (MDP) to meet the outstanding gas requirements for running the generation plants atRokhia and Baramura.
Table 18: Plant wise fuel cost (Approved vs Actual)
Name of Generation station Approved by TREC inTariff order dated22.11.2014
Petitioner'ssubmission fortruing up of FY 2014-15
RGTPPQuantity of Gas (In MMSCM) 200.14 181.51Amount (In Rs. Lacs) 13636.0 12797.3Rate (Rs. /Scm) 6.81 7.05BGTPPQuantity of Gas (In MMSCM) 123.28 132.0Amount (In Rs. Lacs) 8484.0 8868.7Rate (Rs. /Scm) 6.88 6.71
TotalQuantity of Gas (In MMSCM) 323.42 313.5Amount (In Rs. Lacs) 22120.0 21666.0Rate (Rs. /Scm) 6.84 6.91Cost of HSD 10 0Total Fuel Cost 22130.0 21666.0
6.8.3. Operation & Maintenance Expenses32. Operation and Maintenance expenses of TSECL includes following major heads:
Employee Cost:Employee expenses comprise of salaries, dearness allowance, bonus, terminalbenefits in the form of pension & gratuity, leave encashment and staff welfare expenses.
Repair & Maintenance expenses:The A&G expenses of TSECL mainly cover expenses foradministrative requirements like telephone, electricity, vehicles lease, statutory taxes to be paid etcand payment of outsourced agencies like statutory auditors, legal charges, consultancy fees etc.
Administration and General (A&G) Expenses:Regular Repair and Maintenance of theelectrical system as well as the civil and IT infrastructure is critical for operating the system andensuring that assets are able to serve for complete expected life.
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33. It is to be noted that O&M expenses of TSECL for the FY 2014-15 is more or less close to approved O&Mexpenses as shown in table below:
Table 19: O&M Expenses (Approved vs Actual)
Name of Generation station Approved by TREC inTariff order dated22.11.2014
Petitioner'ssubmission fortruing up of FY 2014-15
Employee Cost 109.92 111.77Repair & Maintenance 30.7 28.94A&G 15.67 17.06Total O&M Expenses 156.29 157.77
6.8.4. Depreciation34. The details of depreciation booked and depreciation claimed have already been explained in Depreciation
Section above.
6.8.5. Interest and Financial Charges35. While preparing the provisional truing- up for FY 2014-15, the TSECL has considered the following for
the total Interest and Finance charges:
Interest on loans Guarantee Fee Bank Commission for letter of credit
36. The TSECL has taken loans from the PFC/REC/ Govt. of Tripura. The details about the loan taken byTSECL is given below:
Loan from PFC: The fund is released by PFC under various schemes. 100% of the approved cost isprovided as loan from the Government of India through Gross Budgetary Support (GBS). The loan alongwith interest thereon shall be converted into grant once the establishment of the required system isachieved and verified by an independent agency appointment by Ministry of Power (MoP). No conversionto grant will be made in case projects are not completed within 3 years from date of sanction of theproject. In such case, TSECL will have to bear full loan and interest repayment. As no interest paymentand repayment schedule is mentioned for PFC loan for the computation of interest and finance charges inthis petition no repayment of loan from PFC has been considered.
Loan from REC:The fund is released by REC under RGGVY scheme. 90% of the approved cost isprovided as grant and remaining 10% as loan. This fund is not given directly to TSECL but is disbursedthrough Government of Tripura. TSECL is paying interest on this loan on behalf of GoT in four quarterlyinstallments. In the accounts, this loan is treated under head ‘GoT loan’. The moratorium period of 5years is provided on repayment of this loan. Since this is not the loan given to TSECL and fund receivedon behalf of the GoT,
Loan from Govt. of Tripura (GoT): The Government of Tripura loan is disbursed as interest freeloans from the state government under budgetary Non-Plan consideration and to be repaid to the GoTunder 30 equal installments within a period of 15 years as provided in Memorandum of the governmentof Tripura dated 17th July 2009. The TSECL is persuading with the government of Tripura to convert thisinterest free loan into equity portion. But, till it is converted into equity the amount have been treated asloan.
37. The table below shows the source wise loan during FY 2014-15:
Table 20: Interest on Loan for the FY 2014-15 (In Lakh)
ParticularsLoanfromPFC
Loan fromREC
LoanfromGoL
Loan fromothers
BankCommission
on LCTotal
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ParticularsLoanfromPFC
Loan fromREC
LoanfromGoL
Loan fromothers
BankCommission
on LCTotal
Opening Balance 6,008.88 4,244.68 6,033.56 4,152.50
Closing Balance 9,304.88 - 6,333.56 -
Interest Rate 11.75% 11.75% 0% 11.00% -
Financing charges 7.94
Proposed Interestfor Truing up 7.94 7.94
Approved Interest &finance charges inTariff Order
0.00
6.9. Income6.9.1. Income from Sale of Power38. TSECL supplies power both within the state to the consumers of Tripura at the retail supply tariff notified
by TERC as well as to other states based on bilateral contracts or surplus availability from time to time.The power within Tripura is completely met (except during peak period) before supplying the surpluspower to other states.
39. The detailed actual sales vs. approved sales for the FY 2014-15 are provided below:
Table 21: Sale from Power for the FY 2014-15
ParticularsApproved by TREC in Tariff orderdated 22.11.2014
Petitioner's submission for truingup of FY 2014-15
Sales (MU) Revenue(Lakh) Rs./kwh Sales (MU) Revenue(Lakh) Rs./kwh
Intra-State sale ofpower 784.42 48348.0 6.16 786.12 40,995.8 5.21
Total Inter-StateSales 929.87 28644.0 3.08 706.45 18,715.2 2.65
Total Sale ofPower by TSECL 1714.29 76992.0 4.49 1492.57 59,711.0 4.00
6.9.2. Non-Tariff Income40. The other income of TSECL covers mainly
Income earned on the subsidy paid by State Government of Tripura against the commitment of StateGovernment for reduction in retail supply tariff,
Interest earned on fixed deposits made in various banks and as detailed under the head of‘Investments’, and
Other Miscellaneous Income like sale of scrap, sale of tender, meter rent etc.
Subsidy41. Regarding the subsidy provided by State Government, section 65 of Electricity Act 2003, mandates that,
“If the State Government requires the grant of any subsidy to any consumer or class of consumers in thetariff determined by the State Commission under section 62, the State Government shall,notwithstanding any direction which may be given under section 108, pay, within in advance in themanner as may be specified , by the State Commission the amount to compensate the person affected by
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the grant of subsidy in the manner the State Commission may direct, as a condition for the license or anyother person concerned to implement the subsidy provided for by the State Government:
42. Provided that no such direction of the State Government shall be operative if the payment is not made inaccordance with the provisions contained in this section and the tariff fixed by State Commission shall beapplicable from the date of issue of orders by the Commission in this regard.”
43. Hence, the Act clearly states that the subsidy for reduction of tariff, if desired by the State Government,has to be paid in advance by the State Government and in the scenario of the State Government notpaying the subsidy in advance, the tariff reduction on account of the subsidy promised shall not beapplicable. As such, for calculation of ARR of FY 14-15, the subsidy actually paid by State Governments asrevenue grant of Rs. 62 Crores have been considered under other income as against the subsidycommitted by State Government.
Table 22: Non-tariff Income & Grant (Approved vs Actual)
ParticularsApproved by TREC inTariff order dated22.11.2014
Petitioner'ssubmission fortruing up of FY 2014-15
Revenue from sale of Power 769.92 597.11Revenue subsidy from GoT - 62.00
6.10. Summary of Truing Up
Table 23: Summary of Approved TERC Order for the FY 2014-15 (In Rs. Lakhs)
Particulars Approved byTREC in Tarifforder dated22.11.2014
Fuel cost 22130.0Power purchase cost 35903.0O&M expense 15629.0Depreciation 2206.0Interest on working capital -Interest and finance charges -Reasonable Return 3099.0Aggregate Revenue Requirement (ARR) 78967.0Less: non-tariff income 3540.0Net Aggregate Revenue Requirement 75427.0Revenue from sale of Power 76992.0Revenue subsidy from GoT -Revenue Gap/(Surplus) (1565.0)
Table 24: Summary of Truing Up for the FY 2014-15 (In Rs. Lakh)
SN Particulars ProposedforTruingUp (InLakh)
1 ExpensesA Fuel cost 21,666.1B Power purchase cost 40,820.6C O&M expense 15,776.5D Depreciation 2,024.4
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SN Particulars ProposedforTruingUp (InLakh)
E Interest on working capital 1,675.2F Interest and finance charges 7.9
Total Expenses (1) 81,970.82 RevenueA Revenue from sale of Power 59,711.2B Non-tariff income 6,745.0C Revenue subsidy from GoT 6,200.0
Total Revenue (2) 72,656.23 Reasonable Return Allowed 4,263.085 Actual Gap 13,577.76 Approved gap 1,565.07 Total Gap Sought under Truing up 15,142.7
44. Based on the truing-up exercise done for FY 2014-15, it is seen that a total amount of Rs. 151.43 croresneeds to be passed on to the consumers through anincrease in tariff.
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7. Generation MYT for the FY 2016-17to FY 2018-19
7.1. Introduction1. This section deal with the revenue requirement of generation business of TPGL for the years FY 2016-17
to FY 2018-19.TPGL has calculated the ARR and tariff requirements of generation as per the TERC TariffRegulation (Multi Year Tariff), 2015.
2. TPGL is filing its Annual Revenue Requirement and tariff petition for first time to the Hon’ble TERC asthis company has been formed with all generation assets of TSECL with effect from June, 2015. TPGL hasstarted functioning as an independent entity from September 2016. Also, it is submitted that TSECL hasnot segregated the account statements for generation, transmission and distribution business completely.The break-up of costs in generation, transmission and distribution business, wherever necessary for ARRand tariff calculation, have been done based on the division wise break-up of account statements andmaking suitable assumptions, as necessary, for the common functions like accounts and finance, HR,projects etc. at corporate level.
3. As on date, the statutory audit of the account statements till FY 2013-14 has been completed while thestatutory audit of FY 14-15 & FY 15-16 are in process. Since the account statements for complete year forFY 2016-17 are not available, the figures of FY 2016-17have been projected for the entire year based onthe latest information available at the time of filling of petition and incorporating the audited actual dataof past years as applicable.The financial projections of FY 2017-18 and FY 2018-19have been done basedon the actual data of past years and norms of Tariff Regulation (Multi Year Tariff) 2015, as applicable.
4. The detailed schedules and formats of the Revenue Requirement Form for FY 16-17and MYT for theperiod FY 17-18 & FY 18-19 are given in the subsequent sections.
7.2. Own Generation Parameters7.2.1. Plant Load Factor (PLF) and Auxiliary ConsumptionPast Performance
5. TPGL’s generation is comprised of gas based RGTPP and BGTPP and hydro based GHEP. The PLFs andauxiliary consumption for the three generation units for the period FY 2011-12 to FY 2015-16 is tabulatedbelow:
Table 25: Actual Plant wise PLF from FY 11-12 to FY 15-16
PLF calculation Units FY 12 FY 13 FY 14 FY15 FY 16
Rokhia gas based thermal power plant (RGTPP)Gross Generation MU 419.0 411.8 454.2 420.4 468.8Installed Capacity MW 58.0 57.8 58.1 63.0 63.0PLF % 82.5 81.3 89.3 76.2 84.9Auxiliary Consumption % 1.0 1.0 1.0 1.0 1.0Baramura gas based thermal power plant (BGTPP)Gross Generation MU 358.7 350.2 275.0 306.2 232.9Installed Capacity MW 42.0 42.0 42.0 42.0 42.0PLF % 97.49 95.19 74.74 83.22 63.30Auxiliary Consumption % 1.0 1.0 1.0 1.0 1.0Gumti Hydro Electric Plant (GHEP)Gross Generation MU 38.9 38.8 34.5 30.3 22.0Installed Capacity MW 10 10 10 10 10PLF % 52.2 52.0 46.3 40.7 29.5Auxiliary Consumption % 0.7 0.7 0.7 0.7 0.7
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6. The installed capacity for the years has been calculated based on the average capacity available for theyear (as per the dates of commissioning mentioned in the previous table). It may be noted that PLF ofRGTPP is ranging from around 76% to 89% in last five years and is very close to TERC norms related toPLF in Tariff Regulation (Multi Year Tariff), 2015 i.e. 85%.Based on the trend and expected performance,the PLF of RGTPP is projected at the actual level of FY 2015-16 for the control period.
7. On the other hand, PLF of BGTPP was much higher than TERC norms in FY 2011-12 & FY 2012-13. But inlast three year it is in the range of 63% to 83%. This is because of constraints in gas availability for BGTPPin the last few years. BGTPP has gas allocations of 0.40 MMSCMD (Million Metric Standard Cubic Metreper Day), out of which 0.2 MMSCMD is under the Administered Price Mechanism (APM) gas mechanismand balance 0.2 MMSCMD under the MDP (Market Determined Price) mechanism.
8. However, of late, GAIL is able to supply gas only up to 0.30 MMSCMD (75% of allocation) of which theAPM quota shall be exhausted first and the balance shall be under MDP mechanism. As huge quantity ofgas is required initially only to run the gas turbine, it is not technically and economically feasible to runthe plant at full capacity with this supply. So, currently BGTPP is able to run only one unit of the plant formost durations resulting in lower PLF.
9. Compared to the PLF, the availability factor of RGTPP and BGTPP are much higher at around 98% and93% respectively for the FY 2015-16 as compared to the PLF figures given above. The availability factorsfor the last few years is tabulated below and the details of the calculation are provided in Annexure H:Form A.
Table 26: Plant wise Availability %
Plant wise availability Units FY 15 FY 16 FY 17(tillDec,16)
RGTPP % 88 98 92
BGTPP % 97 93 99
10. In case of GHEP, out of the three units, only two units run continuously based on the annual average livestorage capacity which can generate electricity of 50-60 MUs annually. As such, Gumti plant canpresently generate only 7-8 MW output by running two units.
11. It may be noted that the auxiliary consumption of the generating plants has been considered as per thenorms of the Commission value and the normative values have been considered for calculation of netgeneration.
Projection for FY 16-17 to FY 18-19
12. The PLF for the FY 16-17 have been projected based on actual available data till Nov, 2016 and forremaining four months it is taken same as last four months of FY 15-16 for three plants. In case of FY 17-18 & FY 18-19, it has been assumed to be same as the actual PLF of last year i.e. FY 15-16 in case ofRGTPP & BGTPP and average of last three years in GHEP (to account for the fluctuations on account ofavailability of water).
13. Further, for projecting the net generation in case of BGTPP, an effective increase in capacity of 1.645 MWis assumed with effect from September 2017 after completion of Major Inspection with capacityenhancement & improvement of energy efficiency with procurement of uprated hot gas path capital parts.Hence expected Generation (MU) for FY 17 to FY 19 is calculated below:
Table 27: Projected PLF and Auxiliary Consumption from FY17 to FY19
PLF calculation Units FY 17 FY18 FY 19
Rokhia gas based thermal power plant (RGTPP)Gross Generation MU 448.8 468.8 468.8Installed Capacity MW 63.0 63.0 63.0PLF % 81.1 84.9 84.9Auxiliary Consumption % 1.0 1.0 1.0Baramura gas based thermal power plant (BGTPP)
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PLF calculation Units FY 17 FY18 FY 19
Gross Generation MU 207.3 238.2 242.0Installed Capacity MW 42.0 43.0 43.6*PLF % 56.2 63.3 63.3Auxiliary Consumption % 1.0 1.0 1.0Gumti Hydro Electric Plant (GHEP)Gross Generation MU 36.0 31.1 31.1Installed Capacity MW 10.0 10.0 10.0PLF % 41.0 35.5 35.5Auxiliary Consumption % 0.7 0.7 0.7*The effective capacity after completion of Major Inspection is shown
7.2.2. Heat Rate14. Heat rate of a thermal power plant is a measure of the power plant’s energy efficiency and the heat rates
calculated for RGTPP and BGTPP for FY 12 to FY 16 based on the net calorific values (kcal/StandardCubic Meter) of the gas being supplied to power plants and consumption of gas (Standard Cubic Meter orSCM) is shown below.
Table 28: Plant wise Heat Rate of Past Years
15. It may be observed that actual SHR of BGTPP in last five years is better than TERC norms as per TariffRegulation (Multi Year Tariff), 2015 i.e. 3700 (Kcal/kwh) except in FY 2015-16. The SHR of both plantshas been assumed to be same as the latest performance for the current year (from Apr 2016 to Nov 2016)for the projection period.
7.3. Assets Base and Capital Expenditure16. This section details the gross value of fixed assets and capital expenditure projected for the purpose of
generation business for the FY 16-17, FY 17-18 and FY 18-19. The value of gross fixed asset base is used toproject the amount of depreciation to be recovered from the proposed tariff.
17. In order to project the value of assets, the total capital expenditure expected to be incurred in these yearsis projected. For this, the capital expenditure in progress (projects in pipeline) and those planned to beimplemented in these years are considered and the amount spend in each of these plans is projectedbased on the progress of the work or the expenditure planned to be incurred in the scheme. The tablegiven below details the amount of capital expenditure expected to be incurred from FY 16-17 to FY 18-19.
Table 29: Capital Expenditure from FY 16-17 to FY 18-19 (Rs. lakhs)
Planned Capital Expenditure FY 17 FY18 FY 19
Baramura gas based thermal power plant (BGTPP)Major Inspection / Life extension with capacity enhancement inUnit-V by Sept 2017 (Capacity enhance by 1.645 MW)
- 1796.0 -
Gumti Hydro Electric Plant (GHEP)Major R&M work (DRP ready but some pre project activities andfunding tie up yet not completed) for life extension
- 500.0 700.0
Total - 2296.0 700.0
Year Heat Rate (Kcal/kWh)BGTPP RGTPP Average
FY12 3354.14 3778.58 3591.61FY 13 3320.38 3714.75 3533.49FY 14 3113.65 3468.41 3334.62FY 15 3531.61 3548.20 3541.21FY 16 3747.68 3972.33 3897.77FY 17 (till Nov’16) 3469.6 3635.4 3522.5
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18. It can be observed from the above table that around Rs.30 Cr is expected to be incurred on capitalexpenditure in above mentioned years. These capital expenditure mainly incurred for renovation andmaintenance works of generation plant & machineries. It is expected that 100% of the capital expenditureincurred shall be capitalized in the same year and converted to gross fixed assets, which works out to bearound Rs. 30 crores. The DPR of the above two schemes is attached as Annexure F for reference.
19. One of the major planned capital expenditure of TPGL is combine cycle conversion of RGTPP &BGTPP and renovation & modernization/life extension project of GHEP with total expectedproject value of Rs. 552.60 Crore. TPGL has already prepared DPR to execute this project. Since pre-project activities and fund tie up is not completed yet, hence expected capital expenditure for this projecthas not been considered in this document. This expenditure is detailed below:
Table 30: Details of Combine cycle conversion and R&M of GHEP Projects
Particulars CapacityAddition
Estimated Cost EstimatedTenure
Rokhia gas based thermal power plant(RGTPP)RokhiaConversion of three (3) gas turbine units of Rokhia Powerstation operating in simple/open cycle mode into combinedcycle operation.
35 MW 250.80Crores 28 months
Baramura gas based thermal power plant (BGTPP)Conversion of unit # 4 and 5 gas turbines into a combinedcycle unit in order to derive the benefits of improvement inplant efficiency as well as generate higher plant output
25 MW 192.8Crores 36 months
Gumti Hydro Electric Plant (GHEP)Major inspection and overhauling with capital maintenance ofthe station - 109.60 Crores 36 months
20. Based on the above, the value of the gross value of assets and the asset base for calculation of depreciationis tabulated below. It may be noted that the booked value of assets is based on the original gross valueand no revaluation has been done for the value of assets.
Table 31: Original Value of Fixed Assets in Rs. Lakhs
Particulars FY 16Actual
FY 17Projected
FY 18Projected
FY 19Projected
Rokhia gas based thermal power plant(RGTPP)Rokhia
Opening GFA 24,026.3 24,026.3 24,026.3 24,026.3Addition during the year - - - -
Closing 24,026.3 24,026.3 24,026.3 24,026.3
Baramura gas based thermal power plant(BGTPP)
Opening GFA 15,254.4 15,254.4 15,254.4 17,050.1Addition during the year - - 1,795.7 -
Closing 15,254.4 15,254.4 17,050.1 17,050.1
Gumti Hydro Electric Plant (GHEP)Opening GFA 3060.4 3060.4 3060.4 3560.4
Addition during the year - - 500.0 700.0Closing 3060.4 3060.4 3560.4 4260.4
GROSS TOTAL 42,341.1 42,341.1 44,636.8 45,336.8
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Particulars FY 16Actual
FY 17Projected
FY 18Projected
FY 19Projected
Assets created through Government Grants 23,754.7 23,754.7 25,042.6 25,435.3
Total Asset Base for Depreciation 18,586.4 18,586.4 19,594.2 19,901.5
Cost of intangible assets, if any - - - -
7.4. Investment21. It is submitted that TSECL has not segregated the account statements for generation, transmission and
distribution business completely. TSECL has made investments at corporate level which represents allthree businesses. These investment are primarily in the form of fixed deposits with various banks. Amajority of such investments have been made from fund payable against deposits works or depositreceived from customers for project works which is pending for execution.
22. The income earned from such investments in the form of interest is being separately booked under otherincome category. The projected income earned from such investment allocated between Generation,Transmission and Distribution business in the ratio of gross fixed assets hold by the respectiveaccounting divisions.
23. Earning from investment is projected for FY 17, FY 18 & FY 19 same as FY 2015-16.
Table 32: Original Value of Fixed Assets in Rs. Lakhs
Particulars FY 17Projected
FY 18Projected
FY 19Projected
Rokhia gas based thermal power plant(RGTPP)Rokhia
Investment 5069.21 5069.21 5069.21Interest earned in Investment 335.4 335.4 335.4
Baramura gas based thermal power plant (BGTPP)Investment 3155.74 3155.74 3155.74
Interest earned in Investment 195.0 195.0 195.0
Gumti Hydro Electric Plant (GHEP)Investment 421.18 421.18 421.18
Interest earned in Investment 30.5 30.5 30.5
7.5. Working Capital24. The working capital is estimated for calculating the normative interest charges to be allowed for financing
the working capital requirements. As per TERC Tariff Regulation (Multi Year Tariff), 2015, the workingcapital norms have been defined separately for thermal generation station and Hydro generating stations,as given below:
For Open-cycle Gas Turbine/Combined Cycle thermal generating stations (for RGTPP and BGTPP):
One month Fuel cost
Maintenance spares @ 30% of operation and maintenance expenses
Receivables equivalent to two months of capacity charge and energy charge
One Month O&M Expenses
For Hydro generating station (for GHEP):
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Receivables equivalent to two months of fixed cost
Maintenance spares @ 15% of operation and maintenance expenses
One Month O&M Expenses
25. Based on the above, the normative working capital requirements as per TERC regulations, the normativeinterest component on same and actual interest projected to be incurred for working capital is tabulatedbelow:
Table 33: Interest on Working Capital in Rs. Lakhs
Particulars FY 2016-17Projected
FY 2017-18Projected
FY 2018-19Projected
Rokhia gas based thermal power plant (RGTPP)RokhiaFuel stock 696.4 727.5 727.5Maintenance Spares stock 890.9 951.6 1,016.4Receivables 2,234.7 2,334.8 2,373.3O&M expenses 247.5 264.3 282.3TOTAL 4,069.5 4,278.3 4,399.6Normative Interest on Working Capital @ SBI Base Rate + 3% 12.30%Interest Projected to be Incurred for Working Capital 500.6 526.2 541.1
Baramura gas based thermal power plant (BGTPP)Fuel stock 396.3 455.3 462.6Maintenance Spares stock 594.0 648.9 704.2Receivables 1,342.1 1,342.1 1,342.1O&M expenses 165.0 180.3 195.6TOTAL 2,497.3 2,626.6 2,704.4Normative Interest on Working Capital @ SBI Base Rate + 3% 12.30%Interest Projected to be Incurred for Working Capital 307.2 323.1 332.6
Gumti Hydro Electric Plant (GHEP)Fuel stock - - -Maintenance Spares stock 54.1 57.7 61.5Receivables 73.3 78.4 85.0
O&M expenses 30.1 32.1 34.2TOTAL 157.5 168.1 180.7Normative Interest on Working Capital @ SBI Base Rate + 3% 12.30%Interest Projected to be Incurred for Working Capital 19.4 20.7 22.2
Total Interest on Working Capital of TPGL 827.1 870.0 896.0
7.6. Return on Equity and Tax on Income26. As per Clause 26 of Tariff Regulation (Multi Year Tariff) 2015, Return on Equity shall be computed at a
base rate of 15.50% for thermal stations and 16.50% storage type hydro stations on equity base. So, Baserate for calculation of RoE of two gas plants (RGTPP & BGTPP) and GHEP would be 15.50% and 16.50%respectively.
27. The amount of equity base to be considered for calculation of return has been considered based on therelevant clause (clause 21) of Tariff Regulation (Multi Year Tariff) 2015, which states
“For a project declared under commercial operation on or after 16th Oct 2015, if the equity actuallydeployed is more than 30% of the capital cost, equity in excess of 30% shall be treated as normativeloan.In case of the generating station declared under commercial operation prior to 16th Oct 2015, debt-
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equity ratio allowed by the Commission for determination of tariff for the period ending the year beforethe date of publication of above regulation on the Official Gazette shall be considered”.
28. It may be noted that the Commission in its past orders had considered equity base for the generationprojects as 30% of the Gross Fixed Asset Value and as such the same is considered here for the purpose ofcalculation of RoE. Equity fund of TPGL is calculated after allocating equity fund of TSECL in the Grossfixed assets ratio among generation, transmission and distribution business. After that equity fund ofgeneration business allocated among three plants based on gross fixed assets ratio for each of the plants.
29. The return on equity has been computed on projected paid up capital is summarized in the table givenbelow:
Table 34: Calculation of Equity Fund in Rs. Lakhs
Particulars FY 17Projected
FY 18Projected
FY 19Projected
Rokhia gas based thermal power plant (RGTPP)RokhiaEquity fund (Allocated based on GFA ratio) 11,620.2 11,620.2 11,620.2Total GFA 24,026.3 24,026.3 24,026.3Normative Equity fund (30% of GFA) 7,207.9 7,207.9 7,207.9Equity fund considered for RoE (Min of actual and normative) 7,207.9 7,207.9 7,207.9
Baramura gas based thermal power plant (BGTPP)
Equity fund (Allocated based on GFA ratio) 7,233.9 7,233.9 7,233.9Total GFA 15,254.4 17,050.1 17,050.1Normative Equity fund (30% of GFA) 4,576.3 5,115.0 5,115.0Equity fund considered for RoE (Min of actual and normative) 4,576.3 5,115.0 5,115.0
Gumti Hydro Electric Plant (GHEP)Equity fund (Allocated based on GFA ratio) 965.5 965.5 965.5Total GFA 3,060.4 3,560.4 4,260.4Normative Equity fund (30% of GFA) 918.1 1,068.1 1,278.1
Equity fund considered for RoE (Min of actual and normative) 918.1 965.5 965.5
30. As per Clause 27 of Tariff Regulation (Multi Year Tariff) 2015,
The base rate of return on equity as allowed by the Commission under Clause 26 (mentioned above)shall be grossed up with the effective tax rate of the respective financial year. For this purpose, theeffective tax rate shall be considered on the basis of actual tax paid in the respect of the financial year inline with the provisions of the relevant Finance Acts.
31. Since TPGCL is a newly incorporated company, the Minimum Alternative Tax (MAT Rate)rate has beenconsidered for calculation of RoE as shown below.
Table 35: Calculation of Pre-tax Return on Equity
Sr. No. Particulars RGTPP BGTPP GHEPA. Return on Equity as per norms 15.50% 15.50% 16.50%B. Applicable MAT rate (including surcharge,
education and secondary education cess) 21.91% 21.91% 21.91%
C. Pre-tax Return on Equity [A/(1-B)] 19.85% 19.85% 21.13%
7.7. Expenditure7.7.1. Fuel Cost32. The only fuel used by TPGL for self-generation of energy is natural gas. The natural gas is being sourced
from the reserves at Rokhia, Baramura and Konabanpartly under the Average Price Mechanism (APM) atthe rates notified by the Ministry of Petroleum and Natural Gas (MoP&NG), Government of India and
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partly at the Market Determined Price (MDP). TPGL has allocations of 0.58 MMSCMD and 0.40MMSCMD under the APM gas mechanism for its generation plants at RGTPP and BGTPP respectively.
33. Currently, GAIL is able to supply only 0.50 MMSCMD (86% of allocation) and 0.30 MMSCMD (75% ofallocation) under APM gas mechanism to RGTPP and BGTPP respectively. As huge quantity of gas isrequired initially only to run the gas turbine, it is not technically and economically feasible to run theBaramura plant at full capacity with this supply. So, currently BGTPP is procuring only 0.20 MMSCMDfrom GAIL under APM gas mechanism and running one unit for most of the time. Other than the APMgas allocations, TPGL also purchased some quantity of gas under Market Determined Price (MDP) tomeet the outstanding gas requirements for running the generation plants at Rokhia and Baramura. Basedon above, source wise (APM and MDP) supply of gas of last three years are provided in Table 14 below.For projecting fuel cost, it is assumed that source wise supply of natural gas would be same as FY 2015-16.
34. As per Clause 25 of Tariff Regulation (Multi Year Tariff) 2015, the landed fuel cost of primary fuel andsecondary fuel for tariff determination shall be based on actual weighted average cost of primary fuel andsecondary fuel of the three preceding months. For projecting fuel cost, we have taken average fuel cost forthe period October 2016 to December 2016 for both APM and MDP supply. This fuel cost includes othercosts like metering charges, Vat payable, etc. The supporting invoices for the fuel cost for the threemonths are attached as Annexure G.
Table 36: Projected Source wise Supply of Fuel and fuel cost (per SCM)
Particulars RGTPP BGTPPSource wise supply of Natural Gas(In %)
APM supply from GAIL 89% 64%MDP Supply from ONGC 11% 36%
Fuel Cost (Rs./SCM)Cost of APM Supply 4.10 3.99Cost of MDP Supply 7.49 7.41
35. Plant wise fuel consumption and fuel cost for the projected years are tabled below:
Table 37: Fuel consumption and Fuel Cost in Rs. Lakhs
Particulars FY 17Projected
FY 18Projected
FY 19Projected
Rokhia gas based thermal power plant (RGTPP)RokhiaFuel Consumption (In MMSCM) 187.5 195.9 195.9Fuel Cost (In Lacs) 8,356.8 8,729.7 8,729.7Baramura gas based thermal power plant (BGTPP)
Fuel Consumption (In MMSCM) 91.4 105.0 106.7Fuel Cost (In Lacs) 4,755.3 5,464.0 5,551.1
7.7.2. Operation and Maintenance Cost36. As per Clause 31 (1) (b) of Tariff Regulation (Multi Year Tariff) 2015, Operation and Maintenance
expenses of RGTPP and BGTPP shall be as follows:
Table 38: O&M Expenses as per Norms
Particulars Amount (Rs. in Lacs perMW)
FY 2015-16 44.14FY 2016-17 47.14FY 2017-18 50.35FY 2018-19 53.78FY 2015-16 44.14
37. For hydro generating stations, O&M cost is calculated by escalating last year O&M cost by 6.64%.
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38. It may be submitted that O&M cost of all three plants of TPGL are projected as per norms detailed above.It is also noted that actual O&M cost of each plants of TPGL booked in account statements of previousyears are currently much less as compared to normative O&M cost. This is because of the pending R&Mworks required to be done by TPGCL which are not being carried out because of constraints in funds.However, TPGL plans to carry out planned repair & maintenance of plants including CIBI, majorinspection, etc. as most of machineries in generating stations are quite old. The details of the plannedR&M works are provided in required formats as Annexure H. The expected repair & maintenance for theFY 2016-17 to FY 2017-18 are detailed below:
Table 39: Expected O&M Cost on Planned Repair & Maintenance for the FY 16-17 to FY 18-19 in Rs. Lakhs
Particulars FY 16-17 FY 17-18 FY 18-19
Rokhia gas based thermal power plant (RGTPP)MI & Generator overhauling, Exaust Plenum replace 1200.0Schedule CIBI 95.1 1000.0 1050.0Schedule HGPI 350.0Baramura gas based thermal power plant (BGTPP)Schedule CIBI 100.0
39. Currently, generating plants are running with minimum manpower and TPGL is planning to recruit morethan 110 officials at high level and also increase the strength of field officers. This will also lead to increasein O&M cost of TPGL for the coming years. The recruitment plan of TPGL are details in Annexure14.2Annexure-A: Audited Annual Accounts along with CAG Report
7.8. Annexure-B: Asset Register
7.9. Annexure-C: Status of Arrears
7.10. Annexure-D: Minutes of Meeting of distributioncircles
40. Annexure-E: Internal Audit Report.
41. Based on the above mentioned facts, TPGL is proposing to allow O&M costs as per the norms prescribedby TERC in MYT Regulations 2015 as shown below.
Table 40: O&M Cost in Rs. Lakhs
Particulars FY 2015-16Actual
FY 2016-17Projected
FY 2017-18Projected
FY 2018-19Projected
Rokhia gas based thermal power plant(RGTPP)RokhiaOperation & Maintenance Cost
Employee Cost 252.9Repair & Maintenance 64.5
A&G Cost 175.5Total 492.9 2,969.8 3,172.1 3,388.1
Baramura gas based thermal power plant(BGTPP)Operation & Maintenance Cost
Employee Cost 211.9Repair & Maintenance 266.4
A&G Cost 107.4Total 585.6 1,979.9 2,163.0 2,347.2
Gumti Hydro Electric Plant (GHEP)Operation & Maintenance Cost
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Particulars FY 2015-16Actual
FY 2016-17Projected
FY 2017-18Projected
FY 2018-19Projected
Employee Cost 294.4 314.0 334.8
Repair & Maintenance 15.6 16.7 17.8
A&G Cost 28.2 30.1 32.1Total 338.2 360.7 384.6 410.2
Grand Total 1,416.74 5,310.4 5,719.7 6,145.5
7.10.1. Interest on Working Capital42. The details of interest on Working capitalhave already been explained in section 8.7in detail.
7.10.2. Depreciation43. For the calculation of depreciation, the depreciation rates have been takenfrom Tariff Regulation (Multi
Year Tariff) 2015on the gross asset value. However, in account statement depreciation have beencalculated as per depreciation rate provided in Companies Act 2013 i.e. based on the useful life.
Table 41: Rate of Depreciation as per Tariff Regulation
Particulars Depreciation Rate asper Tariff Regulation
Land 0.00%Building 3.34%Plant & Machinery 5.28%Computer 15.00%Computer and Office Equipment 15.00%Office Equipment 6.33%Furniture 6.33%Vehicles 9.50%
44. The gross asset base booked in account statements includes assets created out of government grants.However, in accordance with accounting procedures as well as regulatory practices in other states,depreciation on such assets has not been claimed to be recovered through tariff and ARR. The gross assetvalue as per the account statements and the gross asset value excluding assets created through grantshave been mentioned earlier in Table 31. Further, the assets which have completely depreciated have alsobeen deducted from the total gross value of assets shown in account statements for the purpose ofcalculation of depreciation. The calculation of assets created through grants is provided below:
Table 42: Calculation of Assets created through Grants
Particulars Amount (Rs. In Lacs)Grants for creation of assets (as per accounts statement 2015-16) 61,929.79Fixed Assets Value including CWIP (as per accounts statement 2015-16) 110,385.83% of Assets created through Grants 56.1%
45. Category wise depreciation calculation for ARR are tabled below:
Table 43: Projected Depreciation (Rs. In Lacs)
Particulars DepreciationRate
FY 17Projected
FY 18Projected
FY 19Projected
Rokhia gas based thermal power plant(RGTPP)RokhiaLand 0.00% - - -Building 3.34% 21.5 21.5 21.5Plant & Machinery 5.28% 1,081.1 1,081.1 1,081.1
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Particulars DepreciationRate
FY 17Projected
FY 18Projected
FY 19Projected
Computer 15.00% 0.7 0.7 0.7Computer and Office Equipment 15.00% 1.5 1.5 1.5Office Equipment 6.33% 0.4 0.4 0.4Furniture 6.33% 0.8 0.8 0.8Vehicles 9.50% 0.4 0.4 0.4
Total 1,106.3 1,106.3 1,106.3Less: Depreciation on Assets acquired through Grant 620.7 620.7 620.7
Net 485.6 485.6 485.6Baramura gas based thermal power plant(BGTPP)Land 0.00% - - -Building 3.34% 6.9 6.9 6.9Plant & Machinery 5.28% 666.7 716.0 752.0Computer 15.00% 0.4 0.4 0.4Computer and Office Equipment 15.00% 0.8 0.8 0.8Office Equipment 6.33% 0.2 0.2 0.2Furniture 6.33% 0.5 0.5 0.5Vehicles 9.50% 0.3 0.3 0.3
Total 675.9 725.2 761.2Less: Depreciation on Assets acquired through Grant 379.2 406.9 427.1
Net 296.7 318.4 334.2Gumti Hydro Electric Plant (GHEP)Land 0.00% - - -Building 3.34% 14.9 14.9 14.9Plant & Machinery 5.28% 120.4 132.2 160.7Computer 15.00% 0.2 0.2 0.2Computer and Office Equipment 15.00% 0.1 0.1 0.1Office Equipment 6.33% 0.1 0.1 0.1Furniture 6.33% 0.1 0.1 0.1
Vehicles 9.50% 0.1 0.1 0.1
Total 136.0 147.7 176.2Less: Depreciation on Assets acquired through Grant 76.3 82.9 98.9
Net 59.7 64.9 77.4
7.10.3. Non-tariff Income46. The other income of TPGL covers mainly interest earned on fixed deposits made in various banks and as
detailed under the head of Investment above, and other miscellaneous income like sale of scrap, sale oftender, meter rent etc. These incomes are being separately booked under other income category. Earningfrom investment and other miscellaneous incomes are projected for the FY 16-17, FY 17-18 & FY 18-19 onthe same level as FY 2015-16.
7.10.4. Summary of ARR and Tariff Proposal for the FY 16-17 to FY18-1947. Based on the details of expenditure and non- tariff income given above and determined in accordance
with TERC tariff regulations, the total annual revenue requirement of FY 15-16 to FY 18-19 is calculated.Currently there is no specific tariff of Generation Company as TPGL filing its first tariff petition. We aresubmitting below generation station wise ARR and tariff proposal for FY 2016-17 to FY 2018-19.
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7.10.5. Actual ARR of FY 2015-16Table 44: Summary of Actuals of FY 15-16in Rs. Lakhs
ParticularsActual FY 2015-16
RGTPP BGTPP GHEP Total1. Installed Capacity (MW) 63.00 42.00 10.00 115.002. Generation (MU) 468.78 232.89 21.97 723.643. Auxiliary Consumption 4.69 2.33 0.15 7.17
Net units available for sale (2-3) 464.09 230.57 21.82 716.47
Expenditure1.Fuel Cost 13,519.0 7,882.0 - 21,401.02. Operation & Maintenance Cost 492.9 585.6 338.2 1,416.7Employee Cost 252.9 211.9 294.4 759.2Repair & Maintenance 64.5 266.4 15.6 346.5A&G Cost 175.5 107.4 28.2 311.13.Finance Cost - - - -4. Depreciation 485.6 296.7 59.7 842.05. Interest on Working Capital - - - -
Total Expenditure (1+2+3+4+5) 14,497.5 8,764.4 397.9 23,659.7Add: Return on Equity 1,430.7 908.4 194.0 2,533.1
ARR 15,928.2 9,672.7 591.9 26,192.9Less: Non-Tariff Income 335.4 195.0 30.5 560.8
Net ARR 15,592.8 9,477.7 561.5 25,632.0
7.10.6. Annual Revenue Requirement and Proposed Tariff for theFY 2016-17Table 45: Summary of ARR of FY 16-17 in Rs. Lakhs
ParticularsProjected FY 2016-17
RGTPP BGTPP GHEP Total1. Installed Capacity (MW) 63.00 42.00 10.00 115.002. Generation (MU) 448.76 207.32 36.03 692.11
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Particulars Projected FY 2016-17
3. Auxiliary Consumption 4.49 2.07 0.25 6.81Net units available for sale (2-3) 444.27 205.25 35.78 685.29
Expenditure1.Fuel Cost 8,356.8 4,755.3 - 13,112.12. Operation & Maintenance Cost 2,969.8 1,979.9 360.7 5,310.4Employee Cost - - 314.0 -Repair & Maintenance - - 16.7 -A&G Cost - - 30.1 -3.Finance Cost - - - -4. Depreciation 485.6 296.7 59.7 842.05. Interest on Working Capital 500.6 307.2 19.4 827.1
Total Expenditure (1+2+3+4+5) 12,312.8 7,339.1 439.7 20,091.6Add: Return on Equity 1,430.7 908.4 194.0 2,533.1
ARR 13,743.6 8,247.5 633.7 22,624.8Less: Non-Tariff Income 335.4 195.0 30.5 560.8
Net ARR 13,408.2 8,052.5 603.3 22,063.9
Table 46: Proposed Tariff of FY 16-17 in Lacs
ParticularsProjected FY 2016-17
RGTPP BGTPP GHEP TotalCapacity ChargesO&M Expenses 2,969.8 1,979.9 360.7 5,310.4Finance Cost - - - -Depreciation 485.6 296.7 59.7 842.0Interest on Working Capital 500.6 307.2 19.4 827.1Reasonable Return 1,430.7 908.4 194.0 2,533.1
Less: Non- Tariff Income 335.4 195.0 30.5 560.8
Capacity Charges (Total) 5,051.4 3,297.1 603.3 8,951.8
Energy Charges 8,356.8 4,755.3 - 13,112.1
Capacity charges Per Unit (Rs. /Unit) 1.14 1.61 0.84 1.31Energy charges Per Unit (Rs. /Unit) 1.88 2.32 0.84 1.91
7.10.7. Annual Revenue Requirement and Proposed Tariff for theFY 2017-18Table 47: Summary of ARR of FY 17-18in Rs. Lakhs
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ParticularsProjected FY 2017-18
RGTPP BGTPP GHEP Total1. Installed Capacity (MW) 63.00 42.96 10.00 115.962. Generation (MU) 468.78 238.22 31.13 738.133. Auxiliary Consumption 4.69 2.38 0.22 7.29
Net units available for sale (2-3) 464.09 235.83 30.92 730.84
Expenditure1.Fuel Cost 8,729.7 5,464.0 - 14,193.62. Operation & Maintenance Cost 3,172.1 2,163.0 384.6 5,719.7Employee Cost - - 334.8 -Repair & Maintenance - - 17.8 -A&G Cost - - 32.1 -3.Finance Cost - - - -4. Depreciation 485.6 318.4 64.9 868.85. Interest on Working Capital 526.2 323.1 20.7 870.0
Total Expenditure (1+2+3+4+5) 12,913.6 8,268.4 470.2 21,652.2Add: Return on Equity 1,430.7 1,015.3 204.0 2,650.1
ARR 14,344.3 9,283.7 674.2 24,302.2Less: Non-Tariff Income 335.4 195.0 30.5 560.8
Net ARR 14,009.0 9,088.7 643.7 23,741.4
Table 48: Proposed Tariff of FY 17-18 in Lacs
ParticularsProjected FY 2017-18
RGTPP BGTPP GHEP TotalCapacity ChargesO&M Expenses 3,172.1 2,163.0 384.6 5,719.7Finance Cost - - - -Depreciation 485.6 318.4 64.9 868.8Interest on Working Capital 526.2 323.1 20.7 870.0Reasonable Return 1,430.7 1,015.3 204.0 2,650.1
Less: Non- Tariff Income 335.4 195.0 30.5 560.8
Capacity Charges (Total) 5,279.3 3,624.8 643.7 9,547.7
Energy Charges 8,729.7 5,464.0 - 14,193.6
Capacity charges Per Unit (Rs. /Unit) 1.14 1.54 1.04 1.31Energy charges Per Unit (Rs. /Unit) 1.88 2.32 1.04 1.94
7.10.8. Annual Revenue Requirement and Proposed Tariff for theFY 2018-19Table 49: Summary of ARR of FY 18-19 in Rs. Lakhs
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ParticularsProjected FY 2018-19
RGTPP BGTPP GHEP Total1. Installed Capacity (MW) 63.00 43.65 10.00 116.652. Generation (MU) 468.78 242.02 31.13 741.933. Auxiliary Consumption 4.69 2.42 0.22 7.33
Net units available for sale (2-3) 464.09 239.60 30.92 734.60
Expenditure1.Fuel Cost 8,729.7 5,551.1 - 14,280.82. Operation & Maintenance Cost 3,388.1 2,347.2 410.2 6,145.5Employee Cost - - 357.0 -Repair & Maintenance - - 19.0 -A&G Cost - - 34.2 -3.Finance Cost - - - -4. Depreciation 485.6 334.2 77.4 897.15. Interest on Working Capital 541.1 332.6 22.2 896.0
Total Expenditure (1+2+3+4+5) 13,144.6 8,565.2 509.8 22,219.5Add: Return on Equity 1,430.7 1,015.3 204.0 2,650.1
ARR 14,575.3 9,580.5 713.8 24,869.6Less: Non-Tariff Income 335.4 195.0 30.5 560.8
Net ARR 14,240.0 9,385.5 683.3 24,308.8
Table 50: Proposed Tariff of FY 18-19 in Lacs
ParticularsProjected FY 2018-19
RGTPP BGTPP GHEP TotalCapacity ChargesO&M Expenses 3,388.1 2,347.2 410.2 6,145.5Finance Cost - - - -Depreciation 485.6 334.2 77.4 897.1Interest on Working Capital 541.1 332.6 22.2 896.0Reasonable Return 1,430.7 1,015.3 204.0 2,650.1
Less: Non- Tariff Income 335.4 195.0 30.5 560.8
Capacity Charges (Total) 5,510.3 3,834.4 683.3 10,027.9
Energy Charges 8,729.7 5,551.1 - 14,280.8
Capacity charges Per Unit (Rs. /Unit) 1.19 1.60 1.11 1.37Energy charges Per Unit (Rs. /Unit) 1.88 2.32 1.11 1.94
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8. ARR for Transmission &DistributionBusiness of TSECL for MYT ControlPeriod (FY 2016-17 to FY 2018-19)
8.1. Introduction48. This section deals with the Aggregate Revenue Requirement (ARR) of transmission& distribution
business of TSECLfor the years FY 2016-17toFY 2018-19.TSECL has calculated the ARR and tariff
requirements for transmission & distribution of power within the State as per theTERC Tariff
Regulations (Multi Year Tariff), 2015. Since this is the first MYT control period, TSECL is proposing
a three control period from FY 2016-17 to FY 2018-19. Based on the experience of the MYT framework
during this control period, the second control period would be appropriately taken.
49. TSECL is filing its AggregateRevenue Requirement (ARR) and Tariff Petition for transmission and
distribution business for the first timeseparately from generation business before the Hon’ble
Commission as a step towards unbundling in power sector of Tripura.A new company named Tripura
Power Generation Limited (TPGL)has been formed with all generation assets of TSECL with effect
from June, 2015. TPGL has started functioning as an independent entity from September 2016. Also, it is
submitted that TSECL has not yet segregated the account statements for generation, transmission and
distribution business completely. The break-up of costs in generation, transmission and distribution
business, wherever necessary for ARR and tariff calculation, have been done based on the division wise
break-up of account statements and making suitable assumptions, as necessary, for the common
functions like accounts and finance, HR, projects etc. at corporate level.
50. As on date, the statutory audit of the account statements till FY 2014-15 has been completed while the
statutory audit of FY 15-16 are in process.Since the account statements for complete year for FY 2016-17
are not available, the figures of FY 2016-17have been projected for the entire year based on the latest
information available at the time of filling ofthe Petition and incorporating theaudited actual data of past
years as applicable.The financial projections for FY 2016-17, FY 2017-18 and FY 2018-19are done
considering FY 2015-16 as base year, actual data available for past years and as per norms of Tariff
Regulations (Multi Year Tariff) 2015, as applicable.
51. The detailed schedules and formats of the Revenue Requirement Form for FY 16-17and ARR for MYT
period of FY 2017-18 to FY 2018-19 are given in the subsequent sections.
8.2. Category wise Projection for growth in No. ofConsumers
1. The category wise growth in number of consumers across various categories for FY 2016-17to FY 2018-19
have been projected based on the provisional values of FY 2015-16 consumer numbers. A YoY growth rate
of 8% is assumed across domestic category, 7% across commercial / non-domestic category, 5% across
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irrigation, 2% across industrial category, 15% across Public Lighting and 13% for the consumers of Mobile
Tower category.
2. The following table shows the no. of consumers for FY 2015-16 to FY 2018-19:
Table 51: Projection for growth in Number of Consumers
Category FY 2015-16(Provisional)
FY 2016-17(Projected)
FY 2017-18(Projected)
FY 2018-19(Projected)
Kutirjyoti 14835 14835 14835 14835RGGVY 12286 12286 12286 12286Domestic 548991 685840 929299 1394743Commercial 56630 79589 144195 350671Irrigation 5206 5485 5785 6107Public water works 4863 5304 5785 6310Industries 5080 5466 5981 6680Tea, Coffee & Rubber Garden 63 82 107 140Bulk supply 885 983 1091 1211Public Lighting 1586 2007 2822 4527Mobile Towers 1199 1358 1539 1744Total 651624 813236 1123726 1799254
8.3. Category wise Projection for growth in Sales1. In the period FY 2013-14 and FY 2014-15 certain categories of consumers have shown high growth rate.
Especially in Domestic and Industrial category. Hence, TSECL has used different growth rates for each
category of consumer. The following table shows the different growth rates used for projecting the sales
for FY 2016-17 to FY 2018-19.
Table 52: CAGR for projecting growth in sales
Sl. No. Category CAGRUsed
1. Domestic 6.36%
2. Commercial 7.65%
3. Industrial 7.71%
4. Irrigation 7.12%
5. Public Lighting 6.90%
6. Public Water Works & Sewage disposal 8.42%
7. Any other category (Tea, Coffee & RubberGarden and Bulk)
7.12%
8. Mobile Towers 9.29%
2. Using the growth rates as mentioned above, the category wise sales have been projected in the followingtable:
Table 53: Projection for growth in Sales
All figures are in Million Units (MUs)
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Sl.No.
Category FY 2015-16(Provisional)
FY 2016-17(Projected)
FY 2017-18(Projected)
FY 2018-19(Projected)
1. Domestic 439.78 467.76 497.52 529.18
2. Commercial 74.92 80.65 86.82 93.46
3. Industrial
a Low & Medium Voltage 21.41 21.41 21.41 21.41
b High Voltage withdemand less than 1 MW
13.99 19.87 28.22 40.09
c HV/EHV with demand of1 MW & above
7.61 10.44 14.33 19.66
4. Railways 0.00 0.00 0.00 0.00
5. Irrigation 33.91 36.32 38.91 41.68
6. Public Lighting 39.71 42.46 45.39 48.52
7. Public Water Works &Sewage disposal
79.35 86.04 93.29 101.15
8. Any other category (Tea,Coffee & Rubber Gardenand Bulk)
76.85 82.33 88.19 94.47
9. Mobile Towers 25.52 27.89 30.48 33.31
13 Total: 813.06 875.17 944.56 1022.93
8.4. Transmission and Distribution Loss1. The table below highlights the T&D losses projected for FY 2016-17 to FY 2018-19:
Table 54: Projection of T&D Loss for MYT Period
FY 2015-16(Provisional)
FY 2016-17(Projected)
FY 2017-18(Projected)
FY 2018-19(Projected)
Distribution Loss (%) 26.77% 21.61% 17.76% 14.51%
Transmission Loss (%) 6.00% 6.00% 5.50% 5.00%
T&D Losses (%) 31.16% 26.32% 22.28% 18.78%
2. The Petitioner submits that high level of T&D loss, is due to increase in the LT:HT ratio as a result
of extensive village electrification, new service connection in remote areas over the years, huge
increase in the LT network etc.
3. TSECL is making sincere efforts in electrifying the un-electrified areas of the state at a fast pace
under grants and loans provided by the Rural Electrification Corporation (REC) under the Rajiv
GrandhiGraminViduyatikaranYojna (RGGVY). Through the implementation of the scheme the
TSECL has provided the electricity to the far flung areas and villages to of the Tripura state. At the
same time, due to increase in the LT network and the domestic and KutirJyoti consumers, losses of
the utility are also increasing at considerable pace. Through different loss reducing measures and
schemes the TSECL has remained successful to contain the losses at the level mentioned in the
Petition.
4. In light of above made submission, we therefore request the Hon’ble Commission to approve the
above projected T&D losses of the TSECL.
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8.5. Energy Balance1. Based on the above projected the energy balance for FY 2016-17 to FY 2018-19 has been calculated
and shown in the table below:
Table 55: Projection of Energy Balance for MYT Period
All figures are in Million Units (MUs)
Particulars FY 2016-17 FY 2017-18 FY 2018-19
Energy from CGS 1744.03 1898.38 2032.28
Inter State Sales 1125.03 1195.94 1195.94
Sale to Mizoram 83.45 83.45 83.45
Sale to Manipur 83.45 83.45 83.45
Bangladesh Sale (100 MW) 643.15 643.15 643.15
Bangladesh Sale (60 MW) 385.89 385.89
Energy Trading 0.44
UI 29.84
IEX 284.71Inter State Transmission Loss 78.48 85.43 91.45
Power Purchase from Other Sources 211.06 211.06 211.06
ISGS Energy at State Bus 751.58 828.08 955.95
Energy from State Generation 685.29 730.84 734.60
Energy available at State Bus 1436.87 1558.92 1690.56
Projected Energy Sales 875.17 944.56 1022.93
Projected T&D Loss (%) 26.32% 22.28% 18.78%
Energy Required at State Bus 1187.73 1215.33 1259.48
Projected Intra State Transmission Loss(%) 6.00% 5.50% 5.00%Energy required at 11 kV level 1116.46 1148.49 1196.50
Projected Distribution Loss (%) 21.61% 17.76% 14.51%
Energy Surplus / (Deficit) at State Bus 249.15 343.59 431.08
Inter State Sales 249.15 343.59 431.08
Energy Trading 32.19 104.91 104.91
UI 1.33 20.14 20.14
IEX 215.62 218.54 306.03
8.6. Power Purchase1. TSECL procures power from NEEPCO, NHPC, NTPC and OTPC. TSECL is receiving power from
OTPC Palatanasince Jan 2014. While projecting power procurement from the NEEPCO and NHPC
sources it is assumed that in FY 2017-18 TSECL will receive the same amount of energy as available
in FY 2016-17 from each of the stations.
2. While projecting the power purchase cost for Power Plants of NEEPCO, TSECL has assumed an
escalation of 2.00% on fixed chargeand energy charge.
3. The following table shows the power procurement cost projected for FY 2016-17 to FY 2018-19:
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Table 56: Projection for Power Purchase Cost for MYT Period
All figures are in Rs. Crore
Generating Stations
FY 2016-17 FY 2017-18 FY 2018-19Fixed
Charge(Rs.
Crore)
EnergyCharge
(Rs.Crore)
FixedCharge(Rs.
Crore)
EnergyCharge
(Rs.Crore)
FixedCharge
(Rs.Crore)
EnergyCharge
(Rs.Crore)
State Generating StationsRGTPP 50.51 83.57 52.79 87.30 55.10 87.30BGTPP 32.97 47.55 36.25 54.64 38.34 55.51GHEP 3.02 3.02 3.22 3.22 3.42 3.42Sub-total 86.50 134.14 92.26 145.16 96.86 146.22Central Generating StationsNEEPCO
Assam GPP 20.82 18.49 21.24 18.86 21.67 19.24Agartala GPP 21.19 23.32 21.61 23.79 22.05 24.26
Kopili –II 0.75 0.90 0.75 0.89 0.76 0.91Ranganadi 11.72 10.39 11.66 10.35 11.89 10.55
Doyang 3.21 4.29 2.51 3.35 2.56 3.42Khandong 0.94 0.77 0.80 0.66 0.81 0.67
Kopili 2.67 2.57 2.20 2.12 2.24 2.16Pare Unit-I 0.00 0.00 0.80 0.80 3.25 3.25
Pare Unit-II 0.00 0.00 0.80 0.80 3.25 3.25Kameng Unit-I 0.00 0.00 1.44 1.44 5.89 5.89
Kameng Unit-II 0.00 0.00 0.00 0.00 5.89 5.89NTPC
Bongaigaon Unit-I 17.39 21.86 17.74 22.30 18.09 22.30Bongaigaon Unit-II 0.00 0.00 25.61 32.19 26.12 32.19
Bongaigaon Unit-III 0.00 0.00 12.80 16.09 26.12 32.19NHPC
Laoktak 8.95 11.30 7.16 9.03 7.30 9.21OTPC
Palatana 167.98 140.60 197.35 136.57 201.30 139.30Sub-total 255.62 234.50 324.46 279.23 359.20 314.68Power from other Sources
Monarchak 0.00 40.64 0.00 51.11 0.00 52.13Solar Power from Monarchak 0.00 1.74 0.00 1.74 0.00 1.74Through Trading 0.00 1.35 0.00 1.35 0.00 1.35Through UI 0.00 42.57 0.00 42.57 0.00 42.57IEX 0.00 3.31 0.00 3.31 0.00 3.31Sub-total 0.00 89.61 0.00 100.08 0.00 101.10Grand Total 342.13 458.24 416.72 524.46 456.06 562.00
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4. The Hon’ble Commission is requested to approve the power purchase cost of Rs. 800.37 Crore for
FY 2016-17,Rs. 941.19 Crore for FY 2017-18 andRs. 1018.06 Crore for FY 2018-19.
8.7. Transmission Charges1. The following table shows the Inter State and Intra State transmission charges for FY 2016-17 to FY
2018-19.
Table 57: Projection of Transmission Charge for MYT Period
All figures are in Rs. Crore
Transmission Charge FY 2016-17 FY 2017-18 FY 2018-19Inter State (PGCIL) 37.80 40.81 43.91Intra State 30.75 56.48 78.19Total 68.55 97.29 122.09
2. The Hon’ble Commission is requested to approve the transmission charge as projected above.
8.8. O&M ExpensesTERC Tariff Regulations, 2015 stipulates the O&M cost to be comprising of Employee cost, R&M
expense and A&Gexpense. Employee cost for FY 2016-17 has been calculated by escalating the
provisional employee expense incurred in the base year of FY 2015-16 by consumer price index
(CPI). Similarly, A&G expense for FY 2016-17 has been calculated by escalating the provisional
employee expense incurred in the base year of FY 2015-16 by wholesale price index (WPI). R&M
expense for FY 2016-17 has been taken in same proportion of opening GFA as that of FY 2015-16.
For calculating employee expense and A&G expense for FY 2017-18 and FY 2018-19 same escalation
index has been used as that taken for FY 2016-17 and for calculating R&M expense same proportion
of opening GFA has been considered. The O&M expense for transmission and distribution business
has been calculated as provided below:
Transmission Business
Table 58: Projection of O&M Expense for Transmission Business for MYT Period
All figures are in Rs. Crore
Particulars FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19As per B.S. Escalation
RateCost Escalation
RateCost Escalation
RateCost
Employee Cost 13.57 7.21% 14.55 23.00% 17.90 7.21% 19.19Repair & Maintenance 1.72 1.72 2.50 18.30A&G Cost 2.86 1.83% 2.92 1.83% 2.97 1.83% 3.02Total O&M 18.15 19.19 23.36 40.51
Distribution Business
Table 59: Projection of O&M Expense for Distribution Business for MYT Period
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All figures are in Rs. Crore
Particulars FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19As per B.S. Escalation
RateCost Escalation
RateCost Escalation
RateCost
Employee Cost 107.68 7.21% 115.44 23.00% 141.99 7.21% 152.22Repair & Maintenance 9.26 11.67 16.73 22.73A&G Cost 13.61 1.83% 13.86 1.83% 14.11 1.83% 14.37Total O&M 130.55 140.97 172.83 189.32
8.9. Capital Expenditure1. Capitalization of the transmission business expenditure for the MYT period has been provided in
the table below:
Table 60: Projection of Expense Capitalization of Transmission Business of TSECL for MYT Period
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19
Transmission Line 46.02 893.25 357.49
Sub-station 21.91 493.94 120.00
Total Capitalization 67.93 1,387.19 477.49
2. Capital expenditure of the distribution business for the MYT period has been provided in the table
below:
Table 61: Projection of Capital Expenditure of Distribution Business of TSECL for MYT Period
All figures are in Rs. Crore
Item/Description FY 2016-17 FY 2017-18 FY 2018-19A) Status of Funds for Capacity Addition: ElectricalInfrastructure in Rural Areas ( Including under theongoing schemes DDUGJY and others)Power Sub-Stations (66/33/22/11KV)-NewAddition 4.40 4.40 13.19Power Sub-Stations (66/33/22/11KV)-Augmentation 0.00 0.00 11.93Feeders of Power Sub-Stations (66/33/22/11KV)-Newaddition
4.06 4.06 12.82
Feeders of Power Sub-Stations (66/33/22/11KV)-Augmentation
0.00 0.00 5.69
Distribution Transformers- New Addition 5.09 5.17 5.28Feeders (11KV)-New Addition 6.22 6.22 18.67Feeder Segregation, 11KV 2.87 2.87 0.00LT Feeders-New Addition 6.12 12.24 0.00Metering of all Consumers 65.23 65.35 65.47Sub-Total 93.99 100.31 133.052) Status of Funds for Capacity Addition of ElectricalInfrastructure in Urban areas ( Including under theongoing schemes IPDS and Others)Power Sub-Stations (66/33/22/11KV)-New Addition 15.28 22.93 0.00Power Sub-Stations (66/33/22/11KV)- Augmentation 2.82 2.82 0.00Feeders of Power Sub-Stations (66/33/22/11KV)-Newaddition
10.37 15.55 0.00
Feeders of Power Sub-Stations (66/33/22/11KV)-Augmentation
5.36 5.36 0.00
Distribution Transformers- New Addition 6.38 6.48 6.48Distribution Transformers- Augmentation 0.74 0.00 0.00
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Item/Description FY 2016-17 FY 2017-18 FY 2018-19Feeders (11KV)-New Addition 12.45 18.67 0.00Feeders (11KV)-augmentation 0.00 0.00 0.00Feeder Segregation, 11KV 6.22 9.33 0.00LT Feeders-New Addition 24.47 36.71 0.00Metering of all Consumers 35.12 35.19 35.25Sub-Total 119.21 153.04 41.73Total 213.20 253.35 174.78
8.10. GFA and Depreciation1. The Gross Fixed Assets (GFA) for TSECL is taken from provisional accounts for FY 2015-16.
Function wise GFA is considered to estimate the GFA added in FY 2016-17 to FY 2018-19. Closing
balance of FY 2015-16 has been considered as opening balance for FY 2016-17 and so on.
2. The Petitioner has considered the depreciation in the following manner:
full year depreciation on the opening balance of GFA
pro-rata depreciation on the additions made to the GFA balance during the financial year
3. It is submitted that for the purpose of computing the allowable depreciation, the GFA base as per
provisional accounts for FY 2015-16has been considered and subsequently yearly capitalization for
2016-17 to FY 2018-19 have been added for calculating closing balance for each year. Further, it is
submitted that depreciation has been computed only on the depreciable asset base and non-
depreciable assets such as land, land rights, etc. have been excluded from such computation.
4. It is further submitted that the “Annexure: 8” to the TERC Regulations (Multi Year Tariff), 2015
specifies the depreciation rate to be charged on each class of asset.
Table 62: Depreciation Rate as provided in ‘Annexure-8’ of the TERC Regulations (Multi Year Tariff), 2015
Asset Depreciation Rate(Salvage
Value=10%)- SLM
Land under full ownership 0.00%
Building 3.34%
Plant & Machinery 5.28%
Computer 15.00%
Computer and Office Equipment 15.00%
Office Equipment 6.33%
Furniture 6.33%
Vehicles 9.50%
5. The following table shows the GFA added for FY 2016-17 to FY 2018-19 and the depreciation for the
asset for the transmission and distribution business of TSECL.
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Transmission Business
Table 63: Depreciation for Transmission Asset calculated as per TERC Regulations (Multi Year Tariff), 2015
All figures are in Rs. Crore
ParticularsFY 2016-17 FY 2017-18 FY 2018-19
Open Add. Close Avg. Dep. Open Add. Close Avg. Dep. Open Add. Close Avg. Dep.
Land 11.53 5.18 16.71 14.12 0.00 16.71 105.74 122.45 69.58 0.00 122.45 36.40 158.85 140.65 0.00Building 1.94 0.87 2.81 2.38 0.07 2.81 17.80 20.61 11.71 0.35 20.61 6.13 26.74 23.68 0.71Plant &Machinery 136.92 61.50 198.42 167.67 7.97 198.42 1255.87 1454.29 826.35 39.27 1454.29 432.29 1886.58 1670.43 79.38
Computer 0.12 0.06 0.18 0.15 0.02 0.18 1.14 1.32 0.75 0.10 1.32 0.39 1.71 1.52 0.20Computer andOfficeEquipment
0.19 0.09 0.28 0.23 0.03 0.28 1.75 2.02 1.15 0.16 2.02 0.60 2.62 2.32 0.31
OfficeEquipment 0.15 0.07 0.22 0.19 0.01 0.22 1.40 1.62 0.92 0.05 1.62 0.48 2.10 1.86 0.11
Furniture 0.33 0.15 0.47 0.40 0.02 0.47 2.99 3.47 1.97 0.11 3.47 1.03 4.50 3.98 0.23Vehicles 0.05 0.02 0.08 0.07 0.01 0.08 0.49 0.57 0.32 0.03 0.57 0.17 0.74 0.65 0.06Total 151.23 67.93 219.16 185.20 8.13 219.16 1387.19 1606.35 912.75 40.07 1606.35 477.49 2083.84 1845.09 81.00Less: AssetsCreated throughGovt Grant
84.85 145.98 5.07 145.98 1,394.45 770.22 33.81 1,394.45 1,824.19 1,609.32 70.65
Total AssetsBase excludingGrants
66.39 73.18 3.06 73.18 211.90 6.26 211.90 259.65 10.35
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Distribution Business
Table 64: Depreciation for Distribution Asset calculated as per TERC Regulations (Multi Year Tariff), 2015
All figures are in Rs. Crore
ParticularsFY 2016-17 FY 2017-18 FY 2018-19
Open Add. Close Avg. Dep. Open Add. Close Avg. Dep. Open Add. Close Avg. Dep.
Land 52.76 22.84 75.60 64.18 0.00 75.60 27.14 102.74 89.17 0.00 102.74 18.72 121.46 112.10 0.00
Building 19.93 8.63 28.56 24.25 0.73 28.56 10.25 38.81 33.69 1.01 38.81 7.07 45.89 42.35 1.27
Plant & Machinery 412.87 178.75 591.62 502.24 23.87 591.62 212.41 804.03 697.82 33.16 804.03 146.54 950.56 877.29 41.69
Computer 1.46 0.63 2.09 1.77 0.24 2.09 0.75 2.84 2.46 0.33 2.84 0.52 3.35 3.09 0.42
Computer andOffice Equipment
3.22 1.39 4.61 3.92 0.53 4.61 1.66 6.27 5.44 0.73 6.27 1.14 7.41 6.84 0.92
Office Equipment 0.72 0.31 1.03 0.87 0.05 1.03 0.37 1.40 1.22 0.07 1.40 0.26 1.66 1.53 0.09
Furniture 1.33 0.57 1.90 1.61 0.09 1.90 0.68 2.58 2.24 0.13 2.58 0.47 3.05 2.82 0.16
Vehicles 0.17 0.07 0.24 0.20 0.02 0.24 0.09 0.32 0.28 0.02 0.32 0.06 0.38 0.35 0.03
Total 492.45 213.20 705.64 599.04 25.52 705.64 253.35 958.99 832.32 35.46 958.99 174.78 1133.77 1046.38 44.58
Less: AssetsCreated throughGovt Grant
276.28 395.89 336.08 14.32 395.89 538.02 466.96 19.89 538.02 636.08 587.05 25.01
Total Assets Baseexcluding Grants 216.17 309.76 11.20 309.76 420.97 15.57 420.97 497.69 19.57
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8.11. Interest and Finance ChargesThe Petitioner has not considered any interest charge for FY 2016-17 to FY 2018-19 for both the
transmission and distribution business in line with the approach adopted by the Commissionin its last
Tariff Order for FY 2014-15 as it has not incurred any actual expense towards interest and finance
charges for FY 2015-16. However, Finance charge of Rs. 0.07 Crore for distribution business has been
considered for FY 2016-17 to FY 2018-19 same as that of provisional accounts of FY 2015-16.
8.12. Interest on Working Capital1. The TERC Tariff Regulation (Multi Year Tariff), 2015 provides for normative interest on working Capital
based on the methodology outlined in the Regulations. The Petitioner is eligible for interest on working
capital worked out on methodology specified in the Regulations for transmission and distribution
business as provided below:
i. Receivables equivalent to two months of fixed cost;
ii. Maintenance spares @ 15% of operation and maintenance expenses specified in Clause 31; and
iii. Operation and maintenance expenses for one month.
2. In accordance with the TERC Tariff Regulations (Multi Year Tariff), 2015, the interest on the working
capital requirement would be the SBI Base Rate plus 300 basis points as on 1st April of the year for which
tariff is determined. The Petitioner in the instant Petition has considered the interest rate on working
capital requirement at 12.30% for FY 2016-17 as well as for FY 2017-18 and FY 2018-19.
3. The Petitioner in accordance with the above mentioned Regulations, calculated the interest on working
capital as shown in the table below:
Transmission Business
Table 65: IoWC calculation for Transmission Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19Receivables (2 months) 5.12 9.41 13.03Maintenance Spares (15% of O&M) 3.94 4.07 4.21O&M Expense (1 Month) 2.19 2.26 2.34Working Capital 11.25 15.75 19.57Rate of Interest 12.30% 12.30% 12.30%Interest on Working Capital 1.38 1.94 2.41
Distribution Business
Table 66: IoWC calculation for Distribution Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19
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Particulars FY 2016-17 FY 2017-18 FY 2018-19Receivables (2 months) 96.14 93.21 107.64Maintenance Spares (15% of O&M) 21.15 25.92 28.40O&M Expense (1 Month) 11.75 14.40 15.78Working Capital 129.03 133.53 151.81Rate of Interest 12.30% 12.30% 12.30%Interest on Working Capital 15.87 16.42 18.67
8.13. Return on Equityand Tax on Return on Equity1. The Regulation 26 of the TERC Tariff Regulation (Multi Year Tariff) 2015 provides for Return on
Equity(RoE) @15.5% on equity base. The amount of equity base to be considered for calculation of
return has been considered based on the relevant clause (clause 21) of Tariff Regulation (Multi Year
Tariff) 2015. The relevant extract of the regulations are as under:
“26. Return on Equity:
I. Return on equity shall be computed in rupee terms, on the equity base determined
inaccordance with Clause 21.
II. Return on equity shall be computed at the base rate of 15.50% for thermal generating
stations, transmission/distribution system including communication system and run
ofthe river hydro generating station, and at the base rate of 16.50% for the storage type
hydro generating stations and run of river generating station with pondage:”
“21. Debt-Equity Ratio:
I. For a project declared under commercial operation on or after the date of publication of
this regulation on the Official Gazette, the debt-equity ratio would be considered as 70:30
as on COD. If the equity actually deployed is more than 30% of the capital cost, equity in
excess of 30% shall be treated as normative loan:
Provided that:
i. where equity actually deployed is less than 30% of the capital cost, actual equity shall
be considered for determination of tariff:
ii. the equity invested in foreign currency shall be designated in Indian rupees on the
date of each investment:
iii. any grant obtained for the execution of the project shall not be considered as a part of
capital structure for the purpose of debt : equity ratio.”
2. It may be noted that the Commission in its past orders had considered equity base for the transmission
and distribution business as 30% of the Gross Fixed Asset Value and as such the same is considered here
for the purpose of calculation of RoE. Equity fund of TSECLis calculated after allocating equity fund of
TSECL in the Gross fixed assets ratio among generation, transmission and distribution business.
3. The return on equity has been computed on projected paid up capital is summarized in the table given
below:
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Transmission Business
Table 67: Return on Equity calculation for Transmission Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19Equity fund (Allocated based onassets ratio)
145.28 145.28 145.28
Opening GFA 151.23 219.16 1,606.35Closing 219.16 1,606.35 2,083.84Average 185.20 912.75 1,845.09Normative Equity (30% of GFA) 55.56 273.83 553.53Equity considered for RoE (Minof actual and normative)
55.56 145.28 145.28
Rate of RoE 15.50% 15.50% 15.50%Return on Equity 8.61 22.52 22.52
Distribution Business
Table 68: Return on Equity calculation for Distribution Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19Equity fund (Allocated based onassets ratio) 322.28 322.28 322.28
Opening GFA 492.45 705.64 958.99Closing 705.64 958.99 1,133.77Average 599.04 832.32 1,046.38Normative Equity (30% of GFA) 179.71 249.70 313.92Equity considered for RoE (Min ofactual and normative) 179.71 249.70 313.92
Rate of RoE 15.50% 15.50% 15.50%Return on Equity 27.86 38.70 48.66
4. Regulation 27 of TERC Tariff Regulation (Multi Year Tariff) 2015 provides for grossing up of base rate of
return on equity with the effective tax rate of the respective financial year and the effective tax rate shall
be computed as per the following formula.
“Rate of pre-tax return on equity = Base rate / (1-t)
Where “t” is the effective tax rate in accordance with Clause (I) of this regulation and shall be
calculated at the beginning of every financial year based on the estimated profit and tax to be paid
estimated in line with the provisions of the relevant Finance Act applicable for that financial year to
the company on pro-rata basis by excluding the income of non-generation or non-
transmission/distribution business, as the case may be, and the corresponding tax thereon. In case of
generating company or the Transmission or the Distribution licensee paying Minimum Alternate Tax
(MAT), “t” shall be considered as MAT rate including surcharge and cess.”
5. The Petitioner has consideredMinimum Alternative Tax (MAT Rate)of 21.91% rate for calculation of pre-
tax RoE as shown below:
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Transmission Business
Table 69: Calculation of Annualized RoE on Pre-tax basis for Transmission Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19Return on Equity 8.61 22.52 22.52Rate of RoE 15.50% 15.50% 15.50%Effective Tax Rate 21.91% 21.91% 21.91%Effective RoE (%) on Pre-tax basis 19.85% 19.85% 19.85%
Annualized RoE onPre-tax Basis 11.03 28.84 28.84
Distribution Business
Table 70: Calculation of Annualized RoE on Pre-tax basis for Distribution Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19Return on Equity 27.86 38.70 48.66Rate of RoE 15.50% 15.50% 15.50%Effective Tax Rate 21.91% 21.91% 21.91%Effective RoE (%) on Pre-tax basis 19.85% 19.85% 19.85%
Annualized RoE onPre-tax Basis 35.67 49.56 62.31
8.14. Non-tariff IncomeThe other income of TSECL covers mainly interest earned on fixed deposits made in various banks
and as detailed under the head above, and other miscellaneous income like sale of scrap, sale of
tender, meter rent etc.These incomesare being separately booked under other income
category.Earning from investment and other miscellaneous incomes are projectedfor the FY 16-17,
FY 17-18 & FY 18-19 on the same level as FY 2015-16.
Transmission Business
Table 71: Non-tariff Income for Transmission Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19Non-tariff Income 3.92 3.92 3.92
Distribution Business
Table 72: Non-tariff Income for Distribution Business
All figures are in Rs. Crore
Particulars FY 2016-17 FY 2017-18 FY 2018-19Non-tariff Income 10.85 10.85 10.85
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8.15. Aggregate Revenue RequirementBased on the details of expenditure and non- tariff income discussed above, the aggregate revenue
requirement of FY 2016-17 to FY 2018-19 is calculated. The following table shows the total ARR
for FY 2016-17 to FY 2018-19.
Transmission Business
Table 73: Aggregate Revenue Requirement for Transmission Business
Sl.No. Particulars Units FY 2016-17 FY 2017-18 FY 2018-19
A Fixed Charge
1 O & M Expenses Rs. Crore 19.19 23.36 40.512 Depreciation Rs. Crore 3.06 6.26 10.353 Interest on Term Loans & Fin. Charges Rs. Crore 0.00 0.00 0.004 Interest on Working Capital Loans Rs. Crore 1.38 1.94 2.415 Recovery of ARR & Tariff Petition Fees# Rs. Crore 0.00 0.00 0.006 Return on Equity Rs. Crore 11.03 28.84 28.847 Provision for bad and Doubtful debt Rs. Crore 0.00 0.00 0.008 Total Fixed Charge Rs. Crore 34.67 60.40 82.119 Less: Non‐Tariff Income Rs. Crore 3.92 3.92 3.92
10 Total Cost Rs. Crore 30.75 56.48 78.19B Total unit transmitted or wheeled MUs 1187.73 1215.33 1259.48C Transmission and Wheeling Charge Paisa/kwh 25.89 46.47 62.08
# Fees for filing tariff Petition has been considered under A&G expense
Distribution Business
Table 74: Aggregate Revenue Requirement for Distribution Business
Sl. No. Particulars Units FY 2016-17 FY 2017-18 FY 2018-19A Fixed Charge
1 Power Purchase Cost Rs. Crore 800.37 941.19 1,018.062 Inter State Transmission Charges Rs. Crore 37.80 40.81 43.91
3 REC Purchase Cost Rs. Crore 7.90 10.01 11.264 Power Purchase Cost Adjustment Rs. Crore 65.65 0.00 0.005 Intra State Transmission Charges Rs. Crore 30.75 56.48 78.196 O & M Expenses Rs. Crore 140.97 172.83 189.327 Depreciation Rs. Crore 11.20 15.57 19.578 Interest on Term Loans & Fin. Charges Rs. Crore 0.07 0.07 0.079 Interest on Working Capital Rs. Crore 15.87 16.42 18.67
10 Recovery of ARR & Tariff Petition Fees Rs. Crore 0.00 0.00 0.0011 Return on Equity Rs. Crore 35.67 49.56 62.3112 Provision for bad and Doubtful debt Rs. Crore 0.00 0.00 0.0013 Total Fixed Charge Rs. Crore 1,146.26 1,302.94 1,441.3614 Less: Non‐Tariff Income Rs. Crore 10.85 10.85 10.8515 Less: Receipt on account of Cross Subsidy
SurchargeRs. Crore 0.00 0.00 0.00
16 Total Cost Rs. Crore 1,135.40 1,292.09 1,430.51# Fees for filing tariff Petition has been considered under A&G expense
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9. Revenue from Operations for FY2016-17 to FY 2018-19
1. TSECL has estimated revenue from sale of power in its licensee area at Rs. 569.32 Crorefor FY
2016-17, Rs. 633.54 Crore for FY 2017-18 and Rs. 716.56 Crore for FY 2018-19 at existing tariff
structure. The revenue from inter State sale of power is estimated to be Rs. 558.55 Crore for FY
2016-17, Rs. 732.85 Crore for FY 2017-18 and Rs. 784.69 Crore for FY 2018-19.The detailed break-
up of the calculation of revenue for various categories of consumers has been provided below:
Revenue at existing tariff
Table 75: Category wise revenue at existing tariff (Rs. Crores)
Category FY 2016-17 FY 2017-18 FY 2018-19
Kutirjyoti 1.08 1.08 1.08RGGVY 0.90 0.90 0.90Domestic 275.89 309.20 355.82Commercial 62.15 69.72 78.05Irrigation 21.05 22.44 23.91Water Works 58.37 63.31 68.66Industrial 40.09 49.37 62.31Tea, Coffee and Rubber Garden 2.29 2.99 3.90Bulk Supply 60.19 64.08 68.10Public Lighting 26.77 28.05 29.37Mobile Tower 20.55 22.41 24.45Total 569.32 633.54 716.56
2. TSECL has calculated revenue at proposed tariff as detailed in the table provided below. The
proposed tariff of around 20% over the existing rates is essential to recover the pending gaps of
future years and meet the increase in cost over the last few years:-
Revenue at proposed tariff
Table 76: Category wise revenue at proposed tariff
All figures are in Rs. Crore
Category FY 2016-17# FY 2017-18# FY 2018-19
Kutirjyoti 1.08 1.08 1.19RGGVY 0.90 0.90 0.99Domestic 275.89 309.20 391.40Commercial 62.15 69.72 85.86Irrigation 21.05 22.44 26.30Water Works 58.37 63.31 75.53Industrial 40.09 49.37 68.54Tea, Coffee and Rubber Garden 2.29 2.99 4.29Bulk Supply 60.19 64.08 74.91Public Lighting 26.77 28.05 32.31Mobile Tower 20.55 22.41 26.90Total 569.32 633.54 788.21#No hike considered
3. The treatment of the revenue gap / (surplus) has been discussed subsequently in this Petition.
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10. Tariff Design and Proposed RateSchedule
10.1. Introduction1. Tariff for a utility should reflect the cost and must be based on cost of supply. While designing the
tariff for the state of Tripura, the tariff were rationalised to the extent that it is in line with the cross
subsidy targets set by the National tariff Policy.
2. The Hon’ble Commission has introduced telescopic tariff which has been accepted positively by the
consumers of the state.
3. In addition, introduction of special category for Mobile towers have helped TSECL in rationalising
the tariff for the state.
4. The current tariff structure has the following categories of consumers
10.2. Tariff StructureTable 77: Applicability of the Tariff Categories
Sl.No.
Category Description
KJ. Kutirjyoti Kutir-Jyoti connection covered under scheme of the State Govt. or Central Govt. Loadmaximum 120 watt (60 watt x 2 points), monthly consumption limited to 15 units, and shallhave to be metered.
A. Domestic Electric service connection related to consumption of electricity for lights, all types of fans,Heating devices, Television, Radio, Refrigerator, Air Conditioner and all other appliances forconsumers own domestic use but not for commercial purpose, educational institutions ownedor aided by State/Central government and all government hospital and all hospital owned bycharitable institutions (not maintained for commercial purposes), as approved and notified bythe State Government.
Classification of Domestic sub-categories are as follows:-
Sub-Category 1 (Single Phase-Domestic [rural])-The sub-category is exclusively provided forrural (as defined under applicable clause of the relevant act) areas subject to a maximumconsumption of 30 units per month.
Sub-Category 2(Single Phase-Slab-1) - For monthly consumption limit:-0-50 units
Sub-Category 3(Single Phase-Slab-2) -For monthly consumption limit: 51-150 units
Sub-Category 4 (SinglePhase-Slab-3) For monthly consumption limit: 151-300 units
Sub-Category 5 (Single Phase-Slab-4) – For monthly consumption above 300 units.
Sub-Category 6 (Three Phase-Compulsory above 10 kW contracted load) - For 3 phaseconnection for all units consumed.
B. Commercial Electric service connection related to consumption of electricity for lights, all types of fans,Heating devices, Television, Radio, refrigerator, Air Conditioner, lift motors, pumps and all
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Sl.No.
Category Description
other appliances used for commercial purposes maintained for Private gain including othersmall power, supply of power to Cinema Hall, Auditorium, Stadium, Nursing Home,Pathological & Clinical Laboratories, Chamber of Medical Practitioners Advocates/ConsultantEngineers/Chartered Accountants and similar other, Private educational institutions ,hospitalsetc.
Classification of Commercial categories are as follows:-
Sub-Category 1 (Single Phase Small Commercial/Pan Shop)-The sub-category isexclusively provided for small entrepreneurs having maximum consumption not exceeding 30Units per month.
Sub-Category 2 (Single Phase–Slab –1)-For monthly consumption limit 0-150 units
Sub-Category 3 (Single Phase-Slab-2)-For monthly consumption above 150 units
Sub-Category 4 (Single Phase–Semi-Commercial) – Applicable for private Educationalinstitution, Private hospital etc. having any type of electrical appliance for all units consumed.
Sub-Category 5 (Three Phase-Commercial –Compulsory above 10 KW contracted load) – Forall units consumed for commercial purpose
Sub-Category 6 (Three Phase – Group Consumer – Commercial) –For 3 Phase connection togroupSub –Category 7Mobile Towers Electric service connection related to consumption ofelectricity in Mobile Tower and metered on HT supply end or on L.T. supply plus 3%Transformer loss.
C. C. Industrial Electric service connection related to Supply/consumption of electricity for industrial purpose,each installation having Motor and other industrial appliances, Battery Charger, WeldingTransformer etc. including the power consumed for Light & Fan in an industry.
Classifications of Industrial sub-categories are as follows
Sub-Category 1 (Up to 5 HP [E-R/5] – Small industrial Entrepreneur in rural (as definedunder applicable clause of the relevant act) areas and for all units consumed having connectedload up to 5 HP
Sub- Category 2 (Up to 5 HP [E-U/5] –The sub-category is for all urban based and for allunits consumed for a maximum connected load up to 5 HP.
Sub-Category 3 (above 5 HP & up to 20 HP) – For all units consumed for a maximumconnected load above 5 HP and up to 20 HP.
Sub-Category 4 (above 20 HP & up to 100 HP) – For all units consumed for a maximumconnected load above 20 HP and up to 100 HP.
Sub-Category 5 (above 100 HP) -For all units consumed for a maximum connected loadabove 100 HP.
D Bulk Supply Electric service connection related to consumption of electricity to the organizations andestablishments having total connected load of 25 KVA or above, such Institutions, School,Collage, University, Defense installations, Railways, All India Radio, Office complexDepartmental, Colony, Dairy with Chilling Plant, Doordarshan , Cold storage, who aremaintaining LT distribution system and having mixed load but desirous to be bulk powersupply consumer based on bulk power supply contract agreement and metered on HT supplyend or on L.T. supply plus 3% Transformer loss.
E. Tea, Coffee &Rubber Garden
Electric service connection related to consumption of electricity for Tea, Coffee and RubberPlantation/Garden for utilization electric power for factory & Irrigation in the Estate including
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Sl.No.
Category Description
the power consumed for lights and fans, in an around the factory premises for all units.F. Public Utility Electric service connection related to consumption of electricity for Water Works, Irrigation,
Public Lighting for Panchayat & Nagar Panchyat /Municipal area, Special public utility forCrematorium, Water pumping, Drainage, Dewatering for all units consumed
Classifications of Public Utility Sub-categories are as follows:
1. Water Works: -Applicable for Motive Power for Water Works including the power consumedfor Light & Fans in Pump House for Water Works for all unit consumed.
2. Irrigation: - Applicable for Motive power for Irrigation including the power consumed forLight & Fans in Pump House for Irrigation as follows:-
a) For all units consumed up to a connected load up to 5 HP.
b) For all unit consumed above 5 HP connected load.
3. Public Lighting :- Electric service connection related to consumption of electricity for allpublic lighting system for streets, roads, lane and parks etc. as follows :-
a) Panchayat: –Within Panchayat area.
b) Nagar Panchyat/ Municipal area – Within Nagar Panchayat/Municipal area.
4. Special Public Utility: - Applicable for Crematorium, emergency water pumping, andDrainage. Dewatering etc and having any type of electrical equipment required in the publicinterest as approved by the State government
a) Special Public Utility (Nagar Panchyat//Municipal area): - Within Nagar Panchayat area.
b) Special Public Utility (Panchayat): - Within Panchayat area..
10.3. Proposed Rate ScheduleThe following table shows the proposed tariff for all the categories of consumers in the state for FY 2018-
19 which is almost 10% increase over the existing rates:
Table 78: Proposed Rate Schedule for FY 2018-19
Sl.No.
ConsumerCategory
Existing(without Subsidy)
Proposed(Without Subsidy)
FixedCharge
EnergyCharge
(Rs./kWh))
Fixed Charge EnergyCharge
(Rs./kWh)
A. KutirJyoti Rs.62/C/M Rs.68.00/Connection/month
B. DomesticDomestic (rural): 0-50 units
Rs.15/C/M 4.03 Rs.17/C/M 4.43Slab 1: Up to 50Units
Rs.25/C/M 4.84 Rs.28/C/M 5.32Slab 2: 51 – 150units
Rs.40/C/M 5.98 Rs.44/C/M 6.58
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Sl.No.
ConsumerCategory
Existing(without Subsidy)
Proposed(Without Subsidy)
FixedCharge
EnergyCharge
(Rs./kWh))
Fixed Charge EnergyCharge
(Rs./kWh)
Slab 3: 151 – 300units
Rs.50/C/M 6.16 Rs.55/C/M 6.78Slab 4: 301 unitsonwards
Rs.50/C/M 7.20 Rs.55/C/M 7.92Three phase(Compulsoryabove 3 kW): Allunits
Rs.50/KW/Month 7.20 Rs.55/KW/Month 7.92
C. Commercial
Small Commercial/ Pan shop: 0-50unit
Rs.25/C/M 5.93 Rs.28/C/M 6.52
Slab 1: Up to 150units
Rs.45/C/M 6.69 Rs.50/C/M 7.36Slab 2: 151 unitsonwards
Rs.60/C/M 7.25 Rs.66/C/M 7.98Semi Commercial:All units
Rs.50/KW/Month 7.25 Rs.55/KW/Month 7.98
Three Phase(Compulsoryabove 3 kW):All units
Rs.50/KW/Month 7.45 Rs.55/KW/Month 8.20
Three Phase –Group Consumer:All units
Rs.50/KW/Month 7.53 Rs.55/KW/Month 8.28
D. Mobile Tower: Allunits
Rs.125/KW/Month 7.34 Rs.138/KW/Month 8.07
E. IrrigationUp to 5 H.P: Allunits
Rs.30/KW/Month 4.95 Rs.33/KW/Month 5.45
Above 5 H.P. : Allunits
Rs.60/KW/Month 5.95 Rs.66/KW/Month 6.55
F. Water works: Allunits
Rs.40/KW/Month 6.65 Rs.44/KW/Month 7.32
G. IndustrialUp to 5 HP (E-R/5):All units
Rs.25/KW/Month 5.93 Rs.28/KW/Month 6.52
Up to 5 HP (E-U/5):All units
Rs.30/KW/Month 6.36 Rs.33/KW/Month 7.00
Above 5 to 20 HP:All units
Rs.45/KW/Month 7.10 Rs.50/KW/Month 7.81
Above 20 to 100 HP:All units
Rs.60/KW/Month 7.24 Rs.66/KW/Month 7.96
Above 100 HP: Allunits
Rs.75/KW/Month 7.25 Rs.83/KW/Month 7.98H. Tea, Coffee and
Rubber Gardens:All units
Rs.75/KW/Month 7.50 Rs.83/KW/Month 8.25
I. Bulk Supply: Allunits
Rs.75/KW/Month 7.33 Rs.83/KW/Month 8.06
J. Public LightingPublic Lighting(Panchayat)
Rs.30/KW/Month 5.55 Rs.33/KW/Month 6.11Public Utility (NagarPanchayat /Municipality)
Rs.60/KW/Month 6.63 Rs.66/KW/Month 7.29K. Special Public
Utility
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Sl.No.
ConsumerCategory
Existing(without Subsidy)
Proposed(Without Subsidy)
FixedCharge
EnergyCharge
(Rs./kWh))
Fixed Charge EnergyCharge
(Rs./kWh)
Special Public Utility(Crematorium)
Rs.45/KW/Month 5.80 Rs.50/KW/Month 6.38
Special Public Utility(Emergency WaterPumping, Drainage,Dewatering, etc.)
Rs.45/KW/Month 5.80 Rs.50/KW/Month 6.38
10.4. New Provisions in Tariff ScheduleTariff For Pre-Paid Meters
In order to reduce AT&C losses, TSECL is planning to promote deployment of pre-paid consumer
meters. This would help TSECL to improve its collection efficiency as well as reduce the working capital
requirements. The cost of pre-paid meters have also reduced over the last few years and the technology
has already been deployed in other placed in India. As such, TSECL plans to promote the
implementation of pre-paid meters are deploy pre-paid meters for new connections, replacement of
defective meters etc.
In order to promote use of pre-paid meters, TSECL proposes to provide consumers a rebate of 2% on
the total electricity bill amount. This shall incentivize the consumers for moving to pre-paid
meters and also would benefit the utility as the risk for non-collection would be mitigated and the
working capital requirement would reduce.
Under pre-paid meters, consumers are required to pay vend transaction charges for every transaction
or recharge done as service charges for the transaction. TSECL feels that levy of additional charges may
become a hindranceinsmooth implementation of pre-paid meters at this stage. As such, in order to
promote pre-paid meters, TSECL proposes that these vend transaction charges would also be borne by
TSECL and the consumers would get a total rebate of 2% on the total electricity bill amount as proposed
above. It is submitted that the expected vending transaction charge would be around Rs. 12 per
consumer per transaction, which shall be recovered through ARR in the initial period.
Online payment
In order to improve customer satisfaction and increase the avenues of easy payment for customers,
TSECL has already implanted the facility of online payment of electricity bill payment by the customers.
For conducting these transactions, certain charges have to be made to the payment service gateway. In
case of online payment, the customer is already incentivized as he can pay the electricity bill from
anywhere without having to come at the collection counter of TSECL. As such, in case of online
payment, TSECL is proposing that the transaction charges of the payment gateway should also be borne
by TSECL and the same shall be recovered through ARR.
Power Factor Rebate and Penalty
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At present, all the consumer categories are charged based on the electricity consumption in kWh and as
such there is no incentive for improvement in power factor. Most of the other states in India have an
incentive-penalty provision in tariff for the big consumers like the industrial consumers to keep the
power factor within the acceptable limits and reduce the losses in the system. Based on the similar
provisions prevalent in other states, TSECL proposes to introduce the following power factor rebate and
penalty provision for HT/EHT Industrial Category consumers initially. The same shall be presently
applicable only for all industrial category consumers but may be extended for other categories in future.
(a) Power Factor Rebate:
I. In case, the average PF (leading or lagging) maintained by the consumer is more than 0.85 and
upto 0.95, a rebate of 1% on the Energy Charges on unit consumption shall be applicable;
II. For PF (leading or lagging) of 0.95 and above upto 0.97, a rebate of 2% on the Energy Charges
on unit consumption shall be applicable;
III. For PF (leading or lagging) of 0.97 and above upto Unity PF, a rebate of 3%on the Energy
Charges on unit consumption shall be applicable.
(b) Power Factor Penalty:
I. In case average PF (leading or lagging) in a month for a consumer fallsbelow 0.85, a penalty
@1% for every 1% fall in PF (leading or lagging) from0.85 to 0.60; plus 2% for every 1% fall
below 0.60 to 0.30 upto and including0.30 shall be levied on total unit consumption.
Limit for Single Phase/Three Phase Consumers
At present, the limit for connected load in single phase connections in LT categories of domestic and
commercial is 3 kW. As against this, most of the states in India have a limit of 5 kW for single phase
connections. The single phase meters available now are also capable of supporting load upto 5 kW.
With the increasing use of appliances like AC, geysers etc. it is felt that the limit for single phase
connections may be increased up to 5 kW to avoid unnecessary inconvenience to the consumers for
change of meters etc. As such, the Hon’ble Commission is requested to change the limit of connected
load in LT domestic and commercial consumers from 3 kW to 5 kW.
10.5. Proposed Miscellaneous ChargesMiscellaneous charges are various charges applicable apart from charges due to regular consumption of
power. TSECL proposes the following miscellaneous charges for FY 2017-18.
Table 79: Proposed Rate Schedule for FY 2017-18
Sl.No. Charge Proposed for FY2017-18
Category-I:- MISCELLANEOUS CHARGES
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Sl.No. Charge Proposed for FY2017-18
A The tariff for temporary supply for lights and fans for festival, ceremonies,public meeting shall be charged at the following rate, namely :-
i Net Rs. 6.00 / kWh
ii Rebate Rs. 0.10 / kWh
iii Gross Rs. 5.90 / kWh
N.B: The minimum charge for each installation which shall be paid in advance shall be Rs. 60/- per day per kWof contracted load or a
fraction thereof
B The tariff for temporary supply for lights & fans to commercialestablishment which shall include temporary Cinema, Theater,Circus, Exhibition, Fare shall be charged at the following rate,namely:-i Net Rs. 7.00 / kWh
ii Rebate Rs. 0.10 / kWh
iii Gross Rs. 6.90 / kWh
N.B: The minimum charge for each installation which shall be paid in advance shall be Rs.60/- per day per KWof contracted load or a
fraction thereofCategory: Other Charges
1 The monthly meter rent for different phases shall be at the followingrate, namely:-
i For single phase meter not exceeding 10 Amp - Rs. 10.00
ii For three phase meter - Rs. 20.00
iii For three phase meter with C.T. Rs. 40.00
iv For HT metering equipment i.e. kWh meter with MDl& KVR suppliedby the Deptt. -
Rs. 250.00
v For Trivector meter- Rs. 400.00
vi For TOD meter Rs. 400.00
2 The charges for testing of meter at the request of consumer for differentphase shall be at the following rate, namely:-
i For each single phase meter- Rs. 50.00
ii For each three phase meter - Rs. 100.00
iii For each HT meter - Rs. 250.00
Provided that after testing it is found that the meter has no defect, and it isin order.
3 The charges for replacement of meter owing to temporary increase ofload which shall be paid in advance shall be at the following rates,namely:-i For single phase Rs. 100.00
ii For three phase Rs. 250.00
4 The charge for replacement of fuse at consumer premises. Nil
5 The charges for installation of subtraction meter & additional meter atconsumer's meter board shall be NOTE- Where two or more meters areinstalled against one connection instead of one meter to suit theconvenience of the consumer, reading of the main meter will be takenand billed for.
Rs. 250.00
6 The monthly meter rent for an additional meter shall be at the followingrates, namely:-
i For single phase Rs. 15.00
ii For three phase Rs. 30.00
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Sl.No. Charge Proposed for FY2017-18
7 There shall be no charge for test, inspection and connection of a newinstallation. But for any further test or inspection which may be foundnecessary owing to any fault in the installation or due to non- compliancewith the condition of supply the charge for each additional test shall be
Rs. 200.00
8 The charges for disconnection on consumers request shall be at the followingrate, namely:-,
i For single phase Rs. 100.00
ii For three phase Rs. 150.00
iii For Bulk/HV/EHV Rs. 200.00
9 The charges for reconnection on consumers request shall be at thefollowing rates, namely:-
i For single phase Rs. 150.00
ii For three phase Rs. 200.00
iii For Bulk/HV/EHV Rs. 250.00
10 The charges for temporary connection which shall be non-refundable forall categories of load through a meter within permissible distance from theelectric supply main shall be at the following rates, namely:-
i For 220-230V(i.e. Single Phase connection) Rs. 300.00 perinstallation
ii For 380-400V (i.e. 3-phase, 4-wire connection). Rs. 500.00 perinstallation
N.B: (i) The consumer shall supply all materials required for service linesas may be approved by licensee, from the nearest pole of the supply point.There shall be no disconnection charge and meter rent for temporaryconnection.N.B: (ii) For temporary. Connection the consumer shall pay as securitydeposit of Rs.750.00 for single phase or Rs.1500.00 for three phase supplywhich is refundable after disconnection of the temporary connection andfinal payment of the energy bill by consumer.N.B: (iii) For the purpose of this clause, temporary connection means aconnection for a continuous period not exceeding 15 days.
11 The charge for changing of meter by a larger capacity at the request ofconsumer in respect of permanent connection shall be at the followingrates, namely:-
i For 220-230V(Single phase) Rs. 150.00
ii For 380-400V (3-phase, 4-wire). Rs. 400.00
The charge for changing the position the meter & the board within the samebuilding at the request of the consumer when no addition in the service lineis required shall be at tile following rates, namely:-
i For 220-230V(Single phase) Rs. 200.00
ii For 380-400V (3-phase, 4-wire). Rs. 400.00
13. Charges for calibration of check meter upon request of consumer. Rs. 200.00
14. Charges for special meter reading on consumer request Rs. 150.00
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11. Revenue Gap for FY 2018-19
11.1. Revenue gap at existing tariffFor calculating the total regulatory asset, TSECL has considered the revenue gap of Rs. 261.38 Crore
corresponding to True-up of FY 2013-14 and FY 2014-15. Further, the gap for FY 2016-17 is calculated by
considering the RE and revenue from retail and bulk sales
The following table shows the gap at existing tariff.
Table 80: Revenue Gap at existing tariff for MYT Period
Sl.No. Particulars Unit FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
1 Revenue at Existing Tariff Rs. Crore 459.28 569.32 633.54 716.56
2 Revenue Subsidy from State Govt. Rs. Crore 69.00 40.00 40.00 0.00
3 Revenue from Inter State Sales Rs. Crore 301.07 558.55 732.85 784.69
4 Total Revenue Rs. Crore 829.35 1,167.87 1,406.39 1,501.25
5 Revenue Gap at existing tariff Rs. Crore 104.76 (32.47) (114.30) (70.74)
11.2. Revenue gap at proposed tariffThe gap at proposed tariff is calculated by considering revenue from tariffs without subsidy. Henceno
Govtsubsidy for FY 2016-17 is considered. The carrying cost for the revenue gap from previous years has
been considered at a rate same as that of rate considered for calculating the interest on working capital
i.e. 12.30% for FY 2017-18 and FY 2018-19. The following table shows the revenue gap for FY 2017-18
and FY 2018-19.
Table 81: Revenue Gap at proposed tariff for MYT Period
Sl. No. Particulars Unit FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
1 Revenue Gap at existingtariff Rs. Crore 104.76 (32.47) (114.30) (70.74)
2 Regulatory Asset carriedover from previous year Rs. Crore 261.38 366.14 333.66 219.37
3 Total Cumulative Gap at theend of the year Rs. Crore 366.14 333.66 219.37 148.63
5 Proposed Tariff HikeAverage % 10%
6Additional Revenuerequired from Proposedtariff
Rs. Crore71.66
7 Balance gap proposed to bekept as regulatory asset Rs. Crore 76.97
It can be observed from the above that the revenue at existing tariff would be sufficient enough to meet
the annual revenue requirement for FY 2017-18 as well as for FY 2018-19. But when the revenue gap
carried over from previous years is considered, it becomes imperative that there is a need to increase the
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existing tariff to make it sufficient enough to meet the requirement. Hon’ble Commission is also aware
that TSECL has signed the tripartite MoU under UDAY scheme which also requires a periodic tariff hike
for FY 2017-18 as well as for FY 2018-19.
In view of above, the Petitioner proposes a tariff hike of 10% over existing tariff to partially recover the
revenue gap of the previous yearstill FY 2018-19. Since the amount of the total gap is quite huge and the
gap has accrued over the last three years, as such, around 50% of the gap is proposed to be recovered in
FY 2018-19 and the balance may be recovered in the subsequent year i.e FY 2019-20.
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12. Open Access Charges
12.1. IntroductionIn this section, TSECL is proposing the open access charges, particularly the distribution wheeling
charge and cross subsidy surcharge, for FY 2017-18.
12.2. Allocation MatrixThe Commission in MYT regulations 2015 has specified that the distribution licensee should segregate
the accounts of licensed business into wheeling business and retail supply business. Further, it provides
that in case accounts are not segregated as per provisions of these Regulations, the distribution licensee,
shall prepare an allocation statement to apportion costs and revenue to respective businesses. The
relevant clause is given below:
“Provided that the commission reserves the right to determine Wheeling Charges of theDistribution Licensee on the basis of segregated accounts the Licensed business intoDistribution Wires Business and Retail Supply Business.
Provided further that where the Distribution Licensee is not able to submit audited andcertified separate accounts for Distribution Wires Business and Retail Supply Business, theCommission shall determine allocation matrix in the following manner:
• The Licensee shall prepare an “allocation matrix” for the control period showingapportionment of costs and revenues to Distribution Wires Business and Retail SupplyBusiness. The statement shall be supported with an explanation of the methodology usedfor such allocations. The Allocation Statement should be consistent over the ControlPeriod, as approved by the Managing Director/CEO of the Licensee.
• The Commission shall review the “allocation matrix” submitted by the Licensee and basedon the prudence check shall finalize the “allocation matrix” for each year of the controlperiod.”
However, TSECL at present, has not segregated its accounts and as such, it is proposing an allocation
matrix for segregation of costs in respective business.
Table 82: Allocation matrix for separation of ARR for Wires Business and Retail Supply Business
Sl.No. Particulars WireBusiness
Retail SupplyBusiness
1 Power purchase expenses 0% 100%
2 Transmission Charge 0% 100%
3 Employee expenses 60% 40%
4 Repair and Maintenance expenses 90% 10%
5 Administration and General expenses 50% 50%
6 Depreciation 90% 10%
7 Interest and Finance charges 90% 10%
8 Interest on working capital 10% 90%
9 Interest on Security deposit 0% 100%
10 Bad debts written off 0% 100%
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Sl.No. Particulars WireBusiness
Retail SupplyBusiness
11 Income tax 90% 10%
12 Return on equity 90% 10%
13 Other income 10% 90%
14 Non-tariff income 0% 100%
15 Revenue subsidy 0% 100%
Based on the above allocation matrix, the total ARR for wheeling business is provided below:
Table 83: Separation of ARR for Wires Business and Retail Supply Business
All figures are in Rs. Crore
Sl.No.
Particulars FY 2017-18 FY 2018-19
WireBusiness
RetailSupply
Business
WireBusiness
RetailSupply
Business1 Power purchase expenses 0.00 951.20 0.00 1029.322 Transmission Charge 0.00 97.29 0.00 122.093 Employee expenses 85.19 56.80 91.33 60.894 Repair and Maintenance expenses 15.05 1.67 20.46 2.275 Administration and General expenses 7.05 7.05 7.18 7.186 Depreciation 14.01 1.56 17.61 1.967 Interest and Finance charges 0.07 0.01 0.07 0.018 Interest on working capital 1.64 14.78 1.87 16.819 Bad debts written off 0.00 0.00 0.00 0.0010 Return on equity 44.61 4.96 56.08 6.2311 Non-tariff income 0.00 10.85 0.00 10.85
Total 167.63 1124.46 194.60 1235.91
12.3. Wheeling ChargesThe wheeling charges for distribution open access consumers and 33 kV voltage level for FY 2017-17,
has been determined from the ARR of the Wires Business distribution, as determined in table above.
Table 84: Wheeling Charge for 33 kV voltage level
Sl. No. Particulars Unit FY 2017-18 FY 2018-19
1 Total energy input into Distributionsystem
MU 1215.33 1259.48
2 Total distribution cost Rs. Crore 167.63 194.60
3 Distribution cost for wires businessfor 33 kV voltage level (assuming 35%of cost at 33 kV)
Rs. Crore 58.67 68.11
4 Wheeling charges for 33 kV voltagelevel
Rs./kWh 0.48 0.54
The wheeling charges for FY 2017-18, as determined above, are applicable for use of the distribution
system of TSECL by other licensees or generating companies or captive power plants or
consumers/users who are permitted open access at 33 kV voltage level under Section 42(2) of the
Electricity Act, 2003.
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12.4. Cross Subsidy SurchargeThe open access consumers are liable to pay the cross subsidy surcharge to compensate the utility for
any loss of revenue due to the shifting of the consumer to the open access system. In accordance with
Regulation ……..of the Tripura Electricity Regulatory Commission(Terms and Condition of Open
Access) Regulation, 2010, consumers with a connected load of 1 MW and above shall be allowed open
access.
For determination of cross subsidy, TSECL would like to propose the following voltage wise cost of
supply which has been calculated based on the methodology specified by Hon’ble APTEL in Appeal No.
102 of 2010 and other related appeals in this matter. Based on the methodology specified by Hon’ble
APTEL, the voltage wise cost of supply is provided below:
Table 85: Calculation of Cost of Supply
Particulars SymbolFY 2017-18
LT 11 kV 33 kV Above33 kV
T&D losses (%) L 22.28% 11.54% 7.03% 5.50%Average Power Purchase rate(Rs./kWh) A 3.31 3.31 3.31 3.31
Average Power Purchase Cost Per UnitSold (Rs./kWh) B=A/(1-L)
4.26 3.75 3.56 3.51
Other Cost Per Unit Sold (Rs./kWh) C=OtherCost/Units sold
1.66 1.66 1.66 1.66
Total Voltage Wise Cost of Supply((Rs./kWh) D=B+C 5.92 5.40 5.22 5.16
Accordingly, the cross subsidy surcharge for HT industry category for FY 2017-18, is shown in the Table
below:
Table 86: Calculation of Cross Subsidy Surcharge
Sl.No.
Particulars Unit 33 kV 33 kV &above
Industrial(Above 100 HP)
Tea, Coffee& Rubber
1 Average Billing Rate as perproposed tariff
Rs./kWh 7.04 7.04 8.47 8.02
2 Voltage Wise Cost ofSupply
Rs./kWh 5.22 5.16 5.92 5.92
3 Cross subsidysurcharge
Rs/kWh 1.82 1.88 2.55 2.10
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13. Compliance to Directives
13.1. Introduction
The Hon’ble Commission has given fresh directives to TSECL in the Tariff Order for FY 2014-15. Thischapter address the compliance of the directives issued by the Commission.
13.2. Adherence to past directives of Hon’ble Commission
13.2.1. Directive 3:Filing Petition for approval of inter-State tariff forManipur and Mizoram to the Commission
The Hon’ble commission has provided the following directive:
“The Commission directs the Petitioner to expedite the process of reviewing the
existing Power Purchase Agreement with Manipur and Meghalaya. The Petitioner
shall submit the Petition for finalisation of tariff for Manipur and Mizoram before the
Commission within two months of the issuance of this Order.”
Compliance to Hon’ble Commission’s Directive:
It is humbly submitted that the Petitioner is selling power to the States of Manipur and
Mizoram as per Power Purchase Agreement. TSECL has filed a separate Petition before the
Hon’ble Commission for determination of tariff for its generating stations. The approved power
purchase rate of the generating stations will be used for fixation of tariff for selling of power to
other States.
13.2.2. Directive 4:Annual Performance Report (APR)
The Hon’ble commission has provided the following directive:
“TSECL has submitted APR for FY 2013-14 along with its Tariff Petition. However, the APR submitted
by TSECL is not complete as many fields in the APR has been left blank by the Petitioner. Further, the
Petitioner has only submitted the information in figures and no relevant reasons in support of the data
has been given in the APR. The Commission directs that at the time of filing the Tariff Petition for FY
2015-16, the Petitioner should submit more detailed APR with complete information and reasons
supporting the actuals wherever necessary.”
Compliance to Hon’ble Commission’s Directive:
It is humbly submitted that the Petitioner in the instant Petition has filed True-up Petition for
FY 2013-14 and FY 2014-15.
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13.2.3. Directive 5:Timely filing of ARR & Tariff Petition
The Hon’ble commission has provided the following directive:
“In view of the above, the Commission directs the Petitioner to submit the Petition for
approval of ARR and Tariff for FY 2015-16 strictly in accordance with the Tariff
Regulations, 2004 and without deficiencies and sticking to the timelines. Further, the
Petitioner should be able to produce all the information sought by the Commission in
a timely manner.”
Compliance to Hon’ble Commission’s Directive:
It is humbly submitted that since the tariff period of FY 2015-16 has already been expired, filing
of Petition for approval of ARR and Tariff for the expired period will not solve the purpose as
tariff cannot be altered retrospectively. Thus, TSECLshall file the True-up Petition for FY 2015-
16 subsequently for approval of the Hon’ble Commission.
13.2.4. Directive 6:Annual Statement of Accounts
The Hon’ble commission has provided the following directive:
“The Commission directs the Petitioner to submit complete Statement of Accounts duly
audited by statutory auditor for all the years from FY 2009-10 to FY 2013-14 by within
three months of issuance of this Order.”
Compliance to Hon’ble Commission’s Directive:
It is humbly submitted that the audited annual accounts for FY 2013-14 to FY 2014-15 along
with CAG audit report has been attached as “Annexure-A” to this Petition.
13.2.5. Directive 7:Assets and Depreciation Register
The Hon’ble commission has provided the following directive:
“The Commission strictly directs the Petitioner to expedite the process of preparing the
asset wise Fixed Assets and Depreciation Register duly audited and submit the same by
within three months of issuance of this Order. Further, the Petitioner shall produce the
same at the time of procedure of determination of ARR and tariff for FY 2015-16.”
Compliance to Hon’ble Commission’s Directive:
It is humbly submitted that the duly audited fixed asset register has been attached as
“Annexure-B” to this Petition.
13.2.6. Directive 8:Management Information System (MIS)
The Hon’ble commission has provided the following directive:
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“The Petitioner is directed to submit a report on upgradation of its billing system within
two months of issuance of this Order. In the said report, TSECL should submit the time
line for completion of a compete Management Information System.”
Compliance to Hon’ble Commission’s Directive:
It is humbly submitted that the Petitioner is making its sincere efforts for upgrading its billing system.
Proposal for upgradation of billing system at 55 electrical sub-division (existing old CEBS system) has
been approved by the Govt. Initiatives are being taken for tying up for funding support. The expected
date of completion is March, 2018.
13.2.7. Directive 9:Collection of past arrears
The Hon’ble commission has provided the following directive:
“The Commission directs the Petitioner to submit the latest status of arrears pending to be collected
within one month of issuance of this Tariff Order.”
Compliance to Hon’ble Commission’s Directive:
It is humbly submitted that the data of arrears has been attached as “Annexure-C” to this
Petition.
13.2.8. Directive 10:Transmission and Distribution Loss
The Hon’ble commission has provided the following directive:
“In view of the same, the Commission directs the Petitioner to expedite its efforts for
reducing the T&D loss of its network. Further, in view of the increased T&D loss, the
Commission directs TSECL to submit within three months of issuance of Tariff Order
for TSECL for FY 2014-15 this Order, its detailed action plan and roadmap for
reducing the T&D loss of its network.”
Compliance to Hon’ble Commission’s Directive:
Hon’ble Commission would appreciate that TSECL has signed tripartite MoU with Ministry of
Power, GoI, Govt. of Tripura under UjwalDiscom Assurance Yojana. In the MoU TSECL has
agreed upon the following AT&C loss trajectory.
Year FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20
AT&C Loss 33.80% 30% 25% 20% 15%
13.2.9. Directive 11:Capital Expenditure Plan
The Hon’ble commission has provided the following directive:
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“Despite being repeatedly directed by the Commission, the Petitioner has again failed to
submit its Capital Expenditure Plan. The Commission strictly directs that TSECL should
review the Capital Expenditure Plan and Business Plan submitted by other utilities in
the country and accordingly prepare and submit its Capital Expenditure Plan for FY
2015-16 within three months of issuance of this Order. TSECL shall produce the same
during the procedure for determination of ARR and tariff for FY 2015-16.”
Compliance to Hon’ble Commission’s Directive:
Hon’ble Commission would appreciate that TSECL has signed tripartite MoU
with Ministry of Power, GoI, Govt. of Tripura under UjwalDiscom Assurance Yojana. In the
MoU TSECL has agreed upon the following capital expenditure trajectory.
Item/Description Total FundRequirement,
in RsCrs
FY2015-
16
FY2016-
17
FY2017-
18
FY2018-
19
FY2019-
20
A) Status of Funds for Capacity Addition: Electrical Infrastructure in Rural Areas ( Including under the ongoing schemesDDUGJY and others)Power SubStations (66/33/22/11KV)-NewAddition
212.91 10.64 4.40 4.40 13.19 61.56
Power SubStations (66/33/22/11KV)-Augmentation
94.17 4.70 0.00 0.00 11.93 5.96
Feeders of Power SubStations (66/33/22/11KV)-New addition
196.55 9.18 4.06 4.06 12.82 56.83
Feeders of Power SubStations (66/33/22/11KV)-Augmentation
44.96 2.26 0.00 0.00 5.69 2.85
Distribution Transformers- New Addition 33.44 1.68 5.09 5.17 5.28 5.32
Feeders (11KV)-New Addition 183.38 9.16 6.22 6.22 18.67 87.11
Feeder Segregation, 11KV 75.40 3.76 2.87 2.87 0.00 40.11
LT Feeders-New Addition 241.50 12.07 6.12 12.24 0.00 128.48
Metering of all Consumers 413.89 20.69 65.23 65.35 65.47 65.59
Sub-Total 1,496.20 74.14 93.99 100.31 133.05 453.81
2) Status of Funds for Capacity Addition of Electrical Infrastructure in Urban areas ( Including under the ongoingschemes IPDS and Others)Power Sub-Stations (66/33/22/11KV)-NewAddition
56.31 2.82 15.28 22.93 0.00 15.28
Power SubStations (66/33/22/11KV)-Augmentation
5.94 0.30 2.82 2.82 0.00 0.00
Feeders of Power SubStations (66/33/22/11KV)-New addition
38.20 1.91 10.37 15.55 0.00 10.37
Feeders of Power SubStations (66/33/22/11KV)-Augmentation
11.28 0.56 5.36 5.36 0.00 0.00
Distribution Transformers- New Addition 41.67 2.09 6.38 6.48 6.48 6.68
Distribution Transformers- Augmentation 1.47 0.74 0.74 0.00 0.00 0.00
Feeders (11KV)-New Addition 45.85 2.28 12.45 18.67 0.00 12.45
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Feeders (11KV)-augmentation 0.00 0.00 0.00 0.00 0.00 0.00
Feeder Segregation, 11KV 22.92 1.15 6.22 9.33 0.00 6.22
LT Feeders-New Addition 90.16 4.51 24.47 36.71 0.00 24.47
Metering of all Consumers 222.87 11.15 35.12 35.19 35.25 35.32
Sub-Total 536.67 27.50 119.21 153.04 41.73 110.79
Total 2,032.88 101.65 213.20 253.35 174.78 564.60
13.2.10. Directive 12:AT&C Loss
The Hon’ble commission has provided the following directive:
“The Commission again directs the Petitioner to get the AT&C losses figures for all the
years from FY 2009-10 to FY 2013-14 audited by the Statutory Auditor and submit the
same before the Commission within two months of issuance of this Order. TSECL shall
also produce the same along during the procedure for determination of ARR and tariff
for FY 2015-16. Further, the audited AT&C losses figures should also reflect in TSECL's
audited Annual Accounts.”
Compliance to Hon’ble Commission’s Directive:
The audited accounts of TSECL are prepared as per the relevant provisions and formats
of Companies Act and presently there is no provision to audit the energy related figures
in AT&C loss calculation. As such, the audit accounts of past years cannot include the
AT&C loss figures.
13.3. Adherence to fresh directives of Hon’ble Commission
13.3.1. Directive 1:Separate annual accounts for Generation, Transmission,Distribution and SLDC
The Hon’ble commission has provided the following directive:
“TSECL is a bundled utility undertaking all three functions, viz., Generation
transmission and distribution of electricity. In most of the States of the Country, the
electricity utilities are unbundled in accordance with Section 131 of the Electricity Act,
2003. Further, for stimulation of competition in the electricity market through Open
Access, which is an underlying spirit of Electricity Act, 2003, unbundling of the state
electricity utility is necessary. In view of the same, the Commission views separation
of accounts of generation, distribution, transmission and load dispatch functions as a
first step in the direction of unbundling of TSECL. In view of the same, the
Commission directs TSECL to submit separate accounts for generation, distribution,
transmission and SLDC functions along with the Tariff Petitions in the future.
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Further, TSECL is directed to submit by March 31st, 2015, a report on its roadmap for
unbundling of the corporation.”
Compliance to Hon’ble Commission’s Directive:
In compliance to the direction of Hon’ble Commissiona new company named Tripura Power
Generation Limited (TPGL) has been formed with all generation assets of TSECL with effect
from June, 2015 for which separateAnnual Revenue Requirement (ARR) and Tariff Petition has
been filed. Also, a separate Annual Revenue Requirement (ARR) and Tariff Petition is being
filed for transmission and distribution business of TSECL, before the Hon’ble TERC. TPGL has
started functioning as an independent entity from September 2016. Also, it is submitted that
TSECL has not yet segregated the account statements for generation, transmission and
distribution business completely. The break-up of costs in generation, transmission and
distribution business, wherever necessary for ARR and tariff calculation, have been done based
on the division wise break-up of account statements and making suitable assumptions, as
necessary, for the common functions like accounts and finance, HR, projects etc. at corporate
level. TSECL shall subsequently undertake adequate measures for prudent segregation of
accounts.
13.3.2. Directive 2:Submission of final truing up Petition for years from FY2009-10 to FY 2012-13
The Hon’ble commission has provided the following directive:
“As mentioned earlier, truing for years since FY 2009-10 has been done on
provisional basis only, based on the provisional annual accounts of TSECL. Final
truing-up based on annual accounts duly audited by Statutory Auditors has been
pending for years since FY 2009-10 because of TSECL’s inability to submit the
audited annual accounts for the previous years. During the regulatory proceedings
for this Tariff Order, TSECL has conveyed that the final annual accounts duly audited
by Statutory Auditors are available for years till FY 2011-12. Further, as mentioned
earlier, the Commission has directed TSECL to produce annual accounts for all the
years from FY 2009-10 to FY 2013-14 duly audited by Statutory Auditors along with
the Tariff Petition for FY 2015-16.
It is directed that within four months of issuance of this Order, TSECL should submit
the Petition for final truing up for all the years from FY 2009-10 to FY 2012-13 based
on the annual accounts of these years duly audited by Statutory Auditors.”
Compliance to Hon’ble Commission’s Directive:
TSECL has undertaken the statutory audit of its financial accounts up to FY 2014-15 and CAG
audit for FY 2013-14. The audited annual accounts for FY 2013-14 to FY 2014-15 along with CAG
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audit report has been attached as “Annexure-A”. The Commission may undertake final truing
up based on the audited annual accounts for respective years.
13.3.3. Directive 3:Submission of Report regarding status of consumermetering and roadmap for achieving 100% consumer metering
The Hon’ble commission has provided the following directive:
“TSECL is directed to submit within two months of issuance of this Order a report on
status of metering of consumers and roadmap for achieving 100% consumer
metering in the State of Tripura. The report shall include the information regarding
number of unmetered consumers in the State and will also include the roadmap of the
Corporation to achieve 100% metering in the State. TSECL is directed to submit the
report within two months of issuance of this Order.”
Compliance to Hon’ble Commission’s Directive:
It is submitted that TSECL has achieved almost 100% metering at the consumer level and is in the
process of ensuring 100% metering at feeder and Distribution Transformer level. All the new
connections are being released with meter and TSECL is purchasing meters at regular interval to
meet its requirement for replacement of defective meters and releasing new connections.
13.3.4. Directive 4:Submission of minutes of meeting of all distributioncircles
The Hon’ble commission has provided the following directive:
“The commission understands that to bring better functional efficiency of the
distribution function of TSECL, there is a need for conducting regular meetings of
permanent and contractual employees of the Corporation at all of its distribution
circles. TSECL is directed to conduct meetings at all of its distribution circles every
month and submit the minutes of the meeting to the Commission every month which
shall include the following:
Circle wise actual loss levels
Loss reduction efforts,
Efforts towards timely billing of consumers
Efforts towards timely revenue collection
Targets given to the officers of the Corporation and compliance of these targets
by the officers
Actions taken on the officers failing to achieve the given targets “
Compliance to Hon’ble Commission’s Directive:
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TSECL has been conducting circle level meetings at regular intervals for reduction in loss, timely
billing of the consumers, timely revenue collection etc. for bringing functional efficiency. The
minutes of meeting conducted in this regard are attached as “Annexure-D” to this Petition.
13.3.5. Directive 5:Conducting internal audit of the Corporationsassets/offices
The Hon’ble commission has provided the following directive:
“The Commission intends TSECL to keep track of its incomes and expenses as well as
its assets at various offices. Hence, the Commission directs TSECL to conduct an
internal audit of its offices at different places and submit the report of the same to the
Commission by June 30th, 2015 indicating procedural discrepancies in following
standard procedures as well as actions taken for its rectification.“
Compliance to Hon’ble Commission’s Directive:
In compliance to the Hon’ble Commission direction, TSECL has been conducting internal audits
at division levels. The internal audit report has been attached as “Annexure-E” to this Petition.
13.3.6. Directive 7:Tariff Petition for diesel generating station
The Hon’ble commission has provided the following directive:
“The revenue requirement related to diesel generating station of TSECL has not been
considered as part of this Tariff Order. The Petitioner is directed to file a separate
tariff Petition with all the relevant data for its diesel generating station.”
Compliance to Hon’ble Commission’s Directive:
It is submitted that the diesel generating station was previously used for emergency purpose and
is not currently in use. The cost of the same has also not been claimed in this Petition.
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14. Annexures
14.1. Proposed Recruitment Plan of TPGL
Existing AdditionalProposed
Existing AdditionalProposed
Existing AdditionalProposed
Existing AdditionalProposed
Existing AdditionalProposed
Existing AdditionalProposed
1 GM (Tech.) 0 1 0 0 0 0 0 0 0 0 0 12 AGM 1 1 0 0 0 0 0 0 0 0 1 13 DGM (Electrical) 2 0 1 0 0 1 1 0 0 0 4 14 DGM (Mechanical) 0 2 0 0 0 0 0 0 0 0 0 25 DGM (Civil) 0 1 0 0 0 0 0 0 0 0 0 16 DGM (IT) 0 1 0 0 0 0 0 0 0 0 0 17 Mgt. Trainee (Electrical) 0 0 0 6 0 6 1 2 0 0 1 148 Mgt. Trainee (Mechanical) 0 0 0 6 0 6 0 2 0 0 0 149 Mgt. Trainee (Civil) 0 0 0 2 0 2 0 2 0 0 0 610 Mgt. Trainee (IT) 0 0 0 2 1 1 0 1 0 0 1 411 Jr. Operator 0 0 3 5 2 5 1 5 0 0 6 1512 Helper Gr. II 0 0 10 10 8 10 7 10 1 0 26 3013 Electrician 0 0 0 3 0 3 0 3 0 0 0 9
1 CFO-cum-CS 0 1 0 0 0 0 0 0 0 0 0 12 DGM (Finance) 0 1 0 0 0 0 0 0 0 0 0 13 Assistant Manager (Finance) 3 0 1 0 1 0 1 0 0 0 6 0
1 DGM (HR & Admin.) 0 1 0 0 0 0 0 0 0 0 0 12 Sr. Manager (HR & Admin.) 1 0 0 0 0 0 0 0 0 0 1 03 Management Trainee 0 2 0 1 0 1 0 1 0 0 0 54 Office Superindent 0 1 0 0 0 0 0 0 0 0 0 15 UDC 3 0 1 0 1 0 0 0 0 0 5 06 LDC 1 2 3 2 0 2 1 2 0 0 5 8
Total
HR & Admin. wing
Finance wing
Technical wing
* Draft Recruitment Proposal of TPGL during 2017 - 18
***Total proposed additional manpower during 2017 - 18: 114 Nos.Corporate Office Rokhia Baramura Gumati MaharaniSl. No. Designation
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14.2. Annexure-A: Audited Annual Accounts along with CAG Report
14.3. Annexure-B: Asset Register
14.4. Annexure-C: Status of Arrears
14.5. Annexure-D: Minutes of Meeting of distribution circles
14.6. Annexure-E: Internal Audit Report
14.7. Annexure F: DPR of combine cycle conversion of RGTPP & BGTPP and renovation &modernization/life extension project of GHEP
14.8. Annexure G: Copy of fuel bill of ONGC & GAIL for the period Oct 2016 to Dec 2016
14.9. Annexure H: Form A: Planned R&M of Rokhia, Baramura and Gumti
14.10. Annexure I: Form F: Plant Characteristics of Rokhia, Baramura and Gumti
MYT Petition for Transmission & Distribution Business of TSECL
Tripura StateElectricity CorporationLimitedSupplementary /additional Informationon Multi Year Tariff forGeneration andDistribution business forFY 2016-17 to FY 2020-21including approval ofARR for FY 2015-16
February 2020
Filed By
Tripura State Electricity CorporationBidyut Bhawan, Banamalipur
Agartala, Tripura (W)
MYT Petition for Transmission & Distribution Business of TSECL
Table of Contents1. Form -1: Petition.................................................................................................................... 4
2. Form-2: Affidavit .................................................................................................................. 6
3. Summary of Present Supplementary Filing ..........................................................................8
3.1. Contents of the Petition .............................................................................................................................. 8
4. Generation MYT for the FY 2016-17 to FY 2020-21................................................................9
4.1. Introduction ................................................................................................................................................ 9
4.2. Own Generation Parameters ..................................................................................................................... 9
4.2.1. Plant Load Factor (PLF) and Auxiliary Consumption .................................................................... 9
4.2.2. Heat Rate ........................................................................................................................................ 10
4.3. Assets Base................................................................................................................................................. 11
4.4. Working Capital.........................................................................................................................................12
4.5. Return on Equity and Tax on Income ......................................................................................................14
4.6. Expenditure ...............................................................................................................................................15
4.6.1. Fuel Cost ...........................................................................................................................................15
4.6.2. Operation and Maintenance Cost ...................................................................................................16
4.6.3. Interest on Working Capital .......................................................................................................... 18
4.6.4. Depreciation ................................................................................................................................... 18
4.6.5. Non-tariff Income............................................................................................................................19
4.6.6. Summary of ARR and Tariff Proposal for the FY 16-17 to FY 20-21 including ARR of FY 2015-16
.....................................................................................................................................................................19
4.6.7. ARR of FY 2015-16..........................................................................................................................20
4.6.8. Annual Revenue Requirement for the FY 2016-17 .......................................................................20
4.6.9. Annual Revenue Requirement for the FY 2017-18........................................................................21
4.6.10. Annual Revenue Requirement for the FY 2018-19......................................................................21
4.6.11. Annual Revenue Requirement for the FY 2019-20 ..................................................................... 22
4.6.12. Annual Revenue Requirement for the FY 2020-21..................................................................... 22
5. ARR for Transmission &Distribution Business of TSECL for MYT Control Period (FY 2016-17
to FY 2020-21) including ARR of FY 2015-16........................................................................... 24
5.1. Introduction .............................................................................................................................................. 24
5.2. Category wise Projection for growth in No. of Consumers .................................................................... 24
5.3. Category wise growth in Sales.................................................................................................................. 25
5.4. Transmission and Distribution Loss ....................................................................................................... 25
5.5. Energy Balance ......................................................................................................................................... 26
5.6. Power Purchase ........................................................................................................................................28
5.7. Transmission Charges ..............................................................................................................................30
5.8. O&M Expenses .........................................................................................................................................30
5.9. GFA and Depreciation .............................................................................................................................. 32
5.10. Interest and Finance Charges ................................................................................................................ 35
5.11. Interest on Working Capital ................................................................................................................... 35
5.12. Return on Equityand Tax on Return on Equity .................................................................................... 36
5.13. Non-tariff Income ...................................................................................................................................38
MYT Petition for Transmission & Distribution Business of TSECL
5.14. Provision for Bad and Doubtful debts ................................................................................................... 39
5.15. Aggregate Revenue Requirement........................................................................................................... 39
6. Revenue from Operations for FY 2016-17 to FY 2018-19 ..................................................... 42
7. Tariff Design and Proposed Rate Schedule ......................................................................... 43
7.1. New Provisions in Tariff Schedule ........................................................................................................... 43
8. Revenue Gap for the control period .................................................................................... 45
8.1. Revenue gap at existing tariff................................................................................................................... 45
9. Open Access Charges .......................................................................................................... 47
9.1. Introduction .............................................................................................................................................. 47
9.2. Allocation Matrix ...................................................................................................................................... 47
9.3. Wheeling Charges..................................................................................................................................... 49
9.4. Cross Subsidy Surcharge.......................................................................................................................... 49
MYT Petition for Transmission & Distribution Business of TSECL
1. Form -1: PetitionBEFORE THE HON’BLE TRIPURA ELECTRICITY REGULATORY COMMISSION, AGARTALA
File No……………………………………………………..
Case No……………………………………………………
IN THE MATTER OF
Filing of the Truing up Petition by Tripura State Electricity Corporation Limited (TSECL) for FY 2013-14 and
FY 2014-15 under TERC (Tariff procedure) Regulations, 2004 and the MYT petition from FY 2016-17 to FY
2020-21 including approval of ARR for FY 2015-16 for generation business and distribution and retail supply
business under TERC MYT regulations, 2015 along with other guidelines and directions issued by the TERC
from time to time and under Section 62 of the Electricity Act, 2003 read with the relevant Guidelines.
AND
IN THE MATTER OF
Tripura State Electricity Corporation Limited (hereinafter referred to as “TSECL” or the “utility”) -
PETITIONER.
The applicant respectfully submits hereunder:
1. After the issuance of the new MYT Regulations 2015 by TERC, TPGL had first filed the first generation
MYT tariff petition from FY 2016-17 to FY 2018-19 on 15th March 2017 and the same was admitted by the
Commission after obtaining various detailed additional information from the petitioner on 16th June
2017. However, the order on the same could not be passed and the same was returned to TPGL on 7th
August 2017.
2. Thereafter, TSECL was finalizing the first MYT petition for distribution business and a
combined petition for generation and distribution business was subsequently filed on 7 th
June 2018 after the approval of BoD. A combined petition was filed because TPGL had not started
independent functioning pending the completion of demerger of TPGL from TSECL as per requirements
of Companies Act 2015. Further, the MYT control period was proposed to be of three years as per
stipulation 5.3(h) of Tariff Policy of MOP, GOI considering this was the first MYT petition of TSECL and
in absence of any approved baseline data uncertainties and other practical consideration, it was felt that
the projections for a longer control period would not be realistic and justified.
3. This petition was not admitted by the Commission and returned on 4th July 2018 directing to resubmit
again at a suitable time. On this order, TSECL wrote a letter to TERC requesting the Commission to not
return the petition but initiate the work of preliminary examination/scrutiny of the petition and the
combined petition for FY 2016-17 to FY 2018-19 (along with truing up of FY 2013-14 and FY 2014-15 and
approval of ARR for FY 2015-16) was again filed on 13th August 2018.
4. On this petition, the Commission wrote a letter on 5th September 2019 directing TSECL to submit MYT
petition for subsequent years as the MYT period of FY 2016-17 to FY 2018-19 had elapsed, without
MYT Petition for Transmission & Distribution Business of TSECL
MYT Petition for Transmission & Distribution Business of TSECL
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3. Summary of Present SupplementaryFiling
3.1. Contents of the PetitionThis petition comprises of following main sections namely:
1. Revised Annual Revenue Requirement (ARR) and Tariff Petition for MYT Control Period of
FY 2016-17 to FY 2018-19 for Generation business and Distribution & retail supply Business
separately based on the actual latest data.
2. MYT Projection for FY 2019-20 & FY 2020-21 based on trends of previous years.
MYT Petition for Transmission & Distribution Business of TSECL
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4. Generation MYT for the FY 2016-17to FY 2020-21
4.1. Introduction1. This section deals with the revenue requirement of generation business of TSECL for the years FY 2016-
17 to FY 2020-21. TSECL has calculated the ARR and tariff requirements of generation as per the TERCTariff Regulation (Multi Year Tariff), 2015.
2. TSECL is filing its Annual Revenue Requirement for generation business separately and tariff petition forfirst time to the Hon’ble TERC. It is submitted that TSECL has not segregated the account statements forgeneration, transmission and distribution business completely and the work is under progress. Thebreak-up of costs in generation, transmission and distribution business, wherever necessary for ARR andtariff calculation, have been done based on the division wise break-up of account statements and makingsuitable assumptions, as necessary, for the common functions like accounts and finance, HR, projects etc.at corporate level. As such, TSECL is submitting a combined petition for generation, transmission anddistribution business with segregated ARR calculations as provided below.
3. As on date, the statutory audit of the account statements till FY 2015-16 and FY 2016-17 has beencompleted while the statutory audit of FY 17-18 and FY 18-19 are in process.The present petition has beenfiled based on the provisional accounts data till FY 2018-19.The ARR and tariff for FY 2019-20 & FY2020-21 has been projected based on the actual data of past years and norms of Tariff Regulation (MultiYear Tariff) 2015, as applicable.
4. The detailed schedules and formats of the Revenue Requirement Form and MYT for the period FY 16-17to FY 20-21 are given in the subsequent sections.
4.2. Own Generation Parameters4.2.1. Plant Load Factor (PLF) and Auxiliary Consumption5. TSECL’s generation is comprised of gas based RGTPP and BGTPP and hydro based GHEP. The PLFs and
auxiliary consumption for the three generation units for the period FY 2011-12 to FY 2020-21 is tabulatedbelow:
Table 1: Actual Plant wise PLF from FY 11-12 to FY 20-21
PLFcalculation Units FY
11-12
FY12-13
FY13-14
FY14-15
FY15-16
FY 16-17
FY 17-18
FY 18-19
FY 19-20
FY 20-21
Rokhia gas based thermal power plant (RGTPP)GrossGeneration
MU 419.0 411.8 454.2 420.4 468.8 435.86 408.29 439.33 441.07 442.82
InstalledCapacity
MW 58.0 57.8 58.1 63.0 63.0 63 63 63 63 63
PLF % 82.5 81.3 89.3 76.2 84.9 78.99 74.00 79.61 79.92 80.24AuxiliaryConsumption
% 1.0 1.0 1.0 1.0 1.0 0.4 0.4 0.4 0.4 0.4
Baramura gas based thermal power plant (BGTPP)GrossGeneration
MU 358.7 350.2 275.0 306.2 232.9 189.54 178.57 173.61 166.15 159.02
InstalledCapacity
MW 42.0 42.0 42.0 42.0 42.0 42 42 42 42 42
PLF % 97.49 95.19 74.74 83.22 63.30 52.8 48.51 47.8 45.16 43.22AuxiliaryConsumption
% 1.0 1.0 1.0 1.0 1.0 0.47 0.5 0.36 0.38 0.4
Gumti Hydro Electric Plant (GHEP)
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PLFcalculation Units FY
11-12
FY12-13
FY13-14
FY14-15
FY15-16
FY 16-17
FY 17-18
FY 18-19
FY 19-20
FY 20-21
GrossGeneration
MU 38.9 38.8 34.5 30.3 22.0 40.79 43.85 35.51 33.31 30.91
InstalledCapacity
MW 10 10 10 10 10 10 10 10 10 10
PLF % 52.2 52.0 46.3 40.7 29.5 46.5 50.06 40.55 37.81 35.29AuxiliaryConsumption
% 0.7 0.7 0.7 0.7 0.7 0.07 0.08 0.09 0.1 0.11
6. The installed capacity for the years has been calculated based on the average capacity available for theyear. It may be noted that PLF of RGTPP is ranging from around 76% to 87% in last seven years and isvery close to TERC norms related to PLF in Tariff Regulation (Multi Year Tariff), 2015 i.e. 85%. However,a Major Inspection test was done for Rokhia in FY 2016-17 reducing the availability and PLF in that year.Based on the trend of past years and expected performance, the performance of RGTPP for FY 19-20 & FY20-21 is projected based on the performance in the last two years as provided in the table above.
7. PLF of BGTPP was much higher than TERC norms in FY 2011-12& FY 2012-13. But FY 15-16 onwards, itis in the range of 63% to 48%. This is because of constraints in gas availability for BGTPP in the last fewyears. BGTPP has gas allocations of 0.40 MMSCMD (Million Metric Standard Cubic Metre per Day), outof which 0.2 MMSCMD is under the Administered Price Mechanism (APM) gas mechanism and balance0.2 MMSCMD under the MDP (Market Determined Price) mechanism.
8. However, of late, GAIL is able to supply gas only up to 0.30 MMSCMD on an average (75% of allocation)of which the APM quota shall be exhausted first and the balance shall be under MDP mechanism. As hugequantity of gas is required initially only to run the gas turbine, it is not technically and economicallyfeasible to run the plant at full capacity with this supply. So, currently BGTPP is able to run only one unitof the plant for most durations resulting in lower PLF. Based on the trend of the last two years andexpected performance, the PLF of BGTPP for FY 19-20 & FY 20-21 is projected as shown in the tableabove
9. Compared to the PLF, the availability factor of RGTPP and BGTPP are much higher at around 98% and50% respectively for the period FY 2016-17-FY 2018-19as compared to the PLF figures given above.Theavailability factors for FY 20 & FY 21 has been kept same as the actual availability factor of FY 18-19 basedon the existing performance and fuel supply scenario mentioned above. The availability factors for thelast few years is tabulated below :
Table 2: Plant wise Availability %
Plant wise availability Units FY 15 FY 16 FY 17 FY 18 FY 19 FY 20 FY 21
RGTPP % 88 98 89.1 93.4 94.1 94.1 94.1
BGTPP % 97 93 61.0 46.8 49.1 49.1 49.1
10. In case of GHEP, out of the three units, only two units run continuously based on the annual average livestorage capacity which can generate electricity of 50-60 MUs annually. As such, Gumti plant canpresently generate only 7-8 MW output by running two units.
11. It may be noted that the auxiliary consumption of the generating plants has been considered as per actualwhich is well within the norms of theCommission.
4.2.2. Heat Rate12. Heat rate of a thermal power plant is a measure of the power plant’s energy efficiency and the heat rates
calculated for RGTPP and BGTPP for FY 12 to FY 19based on the net calorific values (kcal/Standard CubicMeter) of the gas being supplied to power plants and consumption of gas (Standard Cubic Meter or SCM)is shown below. The heat rate for FY 20 & FY 21 has been kept same as the actual value of FY 19 based onthe latest performance expected to continue.
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Table 3: Plant wise Heat Rate of Past Years
YearHeat Rate (Kcal/kWh)
BGTPP RGTPP Average
FY12 3354.14 3778.58 3591.61
FY 13 3320.38 3714.75 3533.49
FY 14 3113.65 3468.41 3334.62
FY 15 3531.61 3548.20 3541.21
FY 16 3747.68 3972.33 3897.77
FY 17 3500 3700 3600
FY 18 3400 3700 3550
FY 19 3400 3700 3550
FY 20 3400 3700 3550
FY 21 3400 3700 3550
13. It may be observed that actual SHR of BGTPP in last eight years is better than TERC norms as per TariffRegulation (Multi Year Tariff), 2015 i.e. 3700 (Kcal/kwh) except in FY 2015-16. For Rokhia, the averageheat rate is same also as per the normative value of 3700 kCal/kWh.
4.3. Assets Base14. This section details the gross value of fixed assets for the generation business for the FY 16-17 to FY 20-
21. The value of gross fixed asset base is used to determine the amount of depreciation to be recoveredfrom the proposed tariff.
15. The value of the gross value of assets and the asset base for calculation of depreciation is tabulated below.The actual value of assets is tabulated from FY 16-17 to FY 18-19. In order to project the value of assets forFY 19-20 & FY 20-21, the total capital expenditure expected to be incurred in these years is projectedbased on the trend of actual addition of assets in the past few years on provisional basis. For this theprevious years’ trend of addition of assets as well as the capital expenditure in progress (projects inpipeline) and those planned to be implemented in these years is considered. It may be noted that thebooked value of assets is based on the original gross value and no revaluation has been done for the valueof assets.
Table 4: Value of Fixed Assets in Rs. Crores
Particulars FY 16 -17
FY 17-18 FY 18-19 FY 19-20(Projected)
FY 20-21(Projected)
Rokhia gas based thermal powerplant (RGTPP)Rokhia
Opening GFA 241.62 241.62 241.62 241.64 241.65Addition during the year - - 0.02 0.01 0.02
Closing 241.62 241.62 241.64 241.65 241.67
Baramura gas based thermalpower plant (BGTPP)
Opening GFA 158.61 158.61 159.47 159.86 160.04Addition during the year - 0.86 0.39 0.18 0.08
Closing 158.61 159.47 159.86 160.04 160.12
Gumti Hydro Electric Plant(GHEP)
Opening GFA 31.86 31.86 31.86 31.86 31.86
Addition during the year - -
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Particulars FY 16 -17
FY 17-18 FY 18-19 FY 19-20(Projected)
FY 20-21(Projected)
Closing 31.86 31.86 31.86 31.86 31.86
GROSS TOTAL 432.09 432.96 433.36 433.55 433.65
Assets created throughGovernment Grants 237.54 237.54 237.54
Total Asset Base for Depreciation 194.55 195.42 195.82
Cost of intangible assets, if any - - -
4.4. Working Capital16. The working capital is estimated for calculating the normative interest charges to be allowed for financing
the working capital requirements. As per TERC Tariff Regulation (Multi Year Tariff), 2015, the workingcapital norms have been defined separately for thermal generation station and Hydro generating stations,as given below:
For Open-cycle Gas Turbine/Combined Cycle thermal generating stations (for RGTPP and BGTPP):
One month Fuel cost
Maintenance spares @ 30% of operation and maintenance expenses
Receivables equivalent to two months of capacity charge and energy charge
One Month O&M Expenses
For Hydro generating station (for GHEP):
Receivables equivalent to two months of fixed cost
Maintenance spares @ 15% of operation and maintenance expenses
One Month O&M Expenses
17. The historical SBI base rate is tabulated below which has been used to calculate the normative interestrate.
Effective Date for SBI Base Rate Interest Rate (%)
16.12.2019 8.45
10.09.2019 8.95
10.12.2018 9.05
01.10.2018 9
01.07.2018 8.95
01.04.2018 8.7
01.01.2018 8.65
01.10.2017 8.95
01.07.2017 9
01.04.2017 9.1
01.01.2017 9.25
05.10.2015 9.3
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Effective Date for SBI Base Rate Interest Rate (%)
08.06.2015 9.7
10.04.2015 9.85
18. 07.11.2013 19. 10
20. Based on the above, the normative working capital requirements as per TERC regulations, the normativeinterest component on same and actual interest to be incurred for working capital is tabulated below:
Table 5: Interest on Working Capital in Rs.Crores
Particulars FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20(Projecte
d)
FY 2020-21(Projected)
Rokhia gas based thermal power plant (RGTPP)RokhiaFuel stock 7.21 6.19 10.91 12.18 12.23MaintenanceSpares stock
8.91 9.52 10.16 10.86 11.59
Receivables 23.16 21.41 31.44 34.47 34.96O&M expenses 2.47 2.64 2.82 3.02 3.22TOTAL 34.54 33.57 44.43 48.34 49.78NormativeInterest onWorking Capital @SBI Base Rate +3%
12.3% 12.1% 11.7% 12.05% 11.45%
Interest onWorking Capital
4.25 4.06 5.2 5.83 5.7
Baramura gasbased thermalpower plant(BGTPP)Fuel stock 4.81 4.13 3.65 3.78 3.61MaintenanceSpares stock
5.94 6.34 6.78 7.24 7.73
Receivables 15.44 14.3 13.57 14.12 14.06O&M expenses 1.65 1.76 1.88 2.01 2.15TOTAL 23.03 22.4 22.23 23.37 23.93NormativeInterest onWorking Capital @SBI Base Rate +3%
12.3% 12.1% 11.7% 12.05% 11.45%
Interest onWorking Capital
2.83 2.71 2.6 2.82 2.74
Gumti HydroElectric Plant(GHEP)Fuel stock - - -MaintenanceSpares stock
0.37 0.42 0.45 0.96 1.02
Receivables 0.69 0.77 0.83 0.89 0.93
O&M expenses 0.21 0.23 0.25 0.27 0.28TOTAL 1.27 1.43 1.52 2.11 2.24Normative 12.3% 12.1% 11.7% 11.45%
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Particulars FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20(Projecte
d)
FY 2020-21(Projected)
Interest onWorking Capital @SBI Base Rate +3%
12.05%
Interest onWorking Capital
0.16 0.17 0.18 0.25 0.26
Total Interest onWorking Capital
of TSECL(Generation)
7.24 6.95 7.98 8.9 8.7
4.5. Return on Equity and Tax on Income21. As per Clause 26 of Tariff Regulation (Multi Year Tariff) 2015, Return on Equity shall be computed at a
base rate of 15.50% for thermal stations and 16.50% storage type hydro stations on equity base. So, Baserate for calculation of RoE of two gas plants (RGTPP & BGTPP) and GHEP would be 15.50% and 16.50%respectively.
22. The amount of equity base to be considered for calculation of return has been considered based on therelevant clause (clause 21) of Tariff Regulation (Multi Year Tariff) 2015, which states
“For a project declared under commercial operation on or after 16th Oct 2015, if the equity actuallydeployed is more than 30% of the capital cost, equity in excess of 30% shall be treated as normativeloan.In case of the generating station declared under commercial operation prior to 16th Oct 2015, debt-equity ratio allowed by the Commission for determination of tariff for the period ending the year beforethe date of publication of above regulation on the Official Gazette shall be considered”.
23. It may be noted that the Commission in its past orders had considered equity base for the generationprojects as 30% of the Gross Fixed Asset Value and as such the same is considered here for the purpose ofcalculation of RoE based on legal precedent as per past orders. Equity fund of TSECL is calculated afterallocating equity fund of TSECL in the Gross fixed assets ratio among generation, transmission anddistribution business. After that equity fund of generation business allocated among three plants basedon gross fixed assets ratio for each of the plants.
24. As per Clause 27 of Tariff Regulation (Multi Year Tariff) 2015,
The base rate of return on equity as allowed by the Commission under Clause 26 (mentioned above)shall be grossed up with the effective tax rate of the respective financial year. For this purpose, theeffective tax rate shall be considered on the basis of actual tax paid in the respect of the financial year inline with the provisions of the relevant Finance Acts.
25. Since TPGCL is a newly incorporated company, the Minimum Alternative Tax (MAT Rate) rate has beenconsidered for calculation of RoE as shown below.
Table 6: Calculation of Pre-tax Return on Equity
Sr. No. Particulars RGTPP BGTPP GHEP
A. Return on Equity as per norms 15.50% 15.50% 16.50%
B. Applicable MAT rate (including surcharge,education and secondary education cess) 21.91% 21.91% 21.91%
C. Pre-tax Return on Equity [A/(1-B)] 19.85% 19.85% 21.13%
26. The return on equity computed on paid up capital is summarized in the table given below:
Table 7: Calculation of Equity Fund and Return on Equity in Rs. Crores
Particulars FY 16-17 FY 17-18 FY 18-19 FY 19-20(Projecte
d)
FY 20-21(Projecte
d)
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Particulars FY 16-17 FY 17-18 FY 18-19 FY 19-20(Projecte
d)
FY 20-21(Projecte
d)Rokhia gas based thermal powerplant (RGTPP)RokhiaEquity fund (Allocated based on GFAratio)
146.25 145.79 146.39 145.80 145.81
Total GFA 241.62 241.62 241.63 241.65 241.66Normative Equity fund (30% of GFA) 72.49 72.49 72.49 72.49 72.5Equity fund considered for RoE (Min ofactual and normative)
72.49 72.49 72.49 72.49 72.5
Return on Equity 14.39 14.39 14.39 14.39 14.39Baramura gas based thermal powerplant (BGTPP)Equity fund (Allocated based on GFAratio)
91.31 91.6 91.97 91.6 91.61
Total GFA 158.6 159.04 159.66 159.95 160.08Normative Equity fund (30% of GFA) 47.58 47.71 47.9 47.98 48.02Equity fund considered for RoE (Min ofactual and normative)
47.58 47.71 47.9 47.98 48.02
Return on Equity 9.44 9.47 9.51 9.52 9.53Gumti Hydro Electric Plant (GHEP)Equity fund (Allocated based on GFAratio)
9.03 9 9.03 9.00 9.00
Total GFA 31.86 31.86 31.86 31.86 31.86Normative Equity fund (30% of GFA) 9.56 9.56 9.56 9.56 9.56
Equity fund considered for RoE (Min ofactual and normative)
9.03 9.00 9.03 9.00 9.00
Return on Equity 1.79 1.79 1.79 1.79 1.79
4.6. Expenditure4.6.1. Fuel Cost27. The only fuel used by TSECL for self-generation of energy is natural gas. The natural gas is being sourced
from the reserves at Rokhia, Baramura and Konaban partly under the Average Price Mechanism (APM) atthe rates notified by the Ministry of Petroleum and Natural Gas (MoP&NG), Government of India andpartly at the Market Determined Price (MDP). TPGL has allocations of 0.58 MMSCMD and 0.40MMSCMD under the APM gas mechanism for its generation plants at RGTPP and BGTPP respectively.
28. Currently, GAIL is able to supply only 0.50 MMSCMD (86% of allocation) and 0.30 MMSCMD (75% ofallocation) under APM gas mechanism to RGTPP and BGTPP respectively. As huge quantity of gas isrequired initially only to run the gas turbine, it is not technically and economically feasible to run theBaramura plant at full capacity with this supply. So, currently BGTPP is procuring only 0.20 MMSCMDfrom GAIL under APM gas mechanism and running one unit for most of the time. Other than the APMgas allocations, TSECL also purchased some quantity of gas under Market Determined Price (MDP) tomeet the outstanding gas requirements for running the generation plants at Rokhia and Baramura. Basedon above, source wise (APM and MDP) supply of gas of FY 2018-19 are provided in Table 8 below.
29. As per Clause 25 of Tariff Regulation (Multi Year Tariff) 2015, the landed fuel cost of primary fuel andsecondary fuel for tariff determination shall be based on actual weighted average cost of primary fuel andsecondary fuel of the three preceding months.This fuel cost includes other costs like metering charges,Vat payable, etc. The latest fuel cost for FY 2018-19 is shown in the table given below
Table 8: Source wise Supply of Fuel and fuel cost (per SCM) in FY 18-19
Particulars RGTPP BGTPPSource wise supply of Natural Gas(In %)
APM supply from GAIL 89.93% 98.83%MDP Supply from ONGC 10.07% 1.17%
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Particulars RGTPP BGTPP
Fuel Cost (Rs./SCM)Cost of APM Supply 6.51 5.87Cost of MDP Supply 8.28 8.10
30. The APM prices notified by MoPNG, GoI during the control period is tabulated below. It may be observedfrom the table that there was an average reduction of 10% in average gas price in FY 2017-18 over FY2016-17 and a subsequent increase of around 30% in FY 2018-19 and a 10% increase in FY 2019-20.Besides the increase in raw gas prices in FY 2018-19, there was an also an increase in taxes applicableon gas price (through VAT charges( and the transportation cost of gas in FY 2018-19 leading to aneffective increase of around 40% in FY 2018-19. The projected fuel cost for FY 2020-21 is estimated to bebased on the actual rate prevailing in the current financial year i.e. FY 2019-20.
Period Gas Price (US$)
April 2016 – Sept 2016 3.06Oct 2016 – Mar 2017 2.5
April 2017 – Sept 2017 2.48Oct 2017- Mar 2018 2.89
April 2018-Sept 2018 3.06Oct 2018- Mar 2019 3.36
April 2019-Sept 2019 3.69Sept 2019 – March 2020 3.23
31. The Plant wise fuel consumption and fuel cost are tabled below:
Table 9: Fuel consumption and Fuel Cost in Rs. Crores
Particulars FY 16-17 FY 17-18 FY18- 19 FY 19-20(Project
ed)
FY 20-21(Project
ed)Rokhia gas based thermal power plant(RGTPP)RokhiaFuel Consumption (In MMSCM) 189.77 183.92 195.64 199.02 199.81Fuel Cost 100.67 88.66 130.97 146.19 146.77Baramura gas based thermal powerplant (BGTPP)Fuel Consumption (In MMSCM) 83.28 75.22 73.48 69.31 66.33Fuel Cost 43.44 34.98 43.79 45.32 43.37
4.6.2. Operation and Maintenance Cost32. As per Clause 31 (1) (b) of Tariff Regulation (Multi Year Tariff) 2015, Operation and Maintenance
expenses of RGTPP and BGTPP has been calculated based on the normative cost per MW of capacity. Thetotal O&M cost for the generation is shown below:
Table 10: O&M Expenses as per Norms
Particulars Amount (Rs. in Lacsper MW)
FY 2015-16 44.14
FY 2016-17 47.14
FY 2017-18 50.35
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Particulars Amount (Rs. in Lacsper MW)
FY 2018-19 53.78
FY 2015-16 44.14
FY 2016-17 51.98
FY 2017-18 55.68
FY 2018-19 53.78
FY 2019-20 57.44
FY 2020-21 61.34
33. For hydro generating stations, O&M cost is calculated by escalating last year O&M cost by 6.64%.
34. The plant wise actual O&M Cost incurred from FY 2015-16 to FY 2020-21 is detailed below.
Table 11: O&M Cost in Rs. Crores
Particulars FY2015-16Actual
FY2016-17Actual
FY 2017-18Actual
FY 2018-19
Actual
FY 2019-20(Projected)
FY 2020-21(Projected)
Rokhia gas based thermal powerplant (RGTPP)RokhiaActual Operation & MaintenanceCost
Employee Cost 2.52 2.67 3.39Repair & Maintenance 0.64 3.13 12.5
A&G Cost 1.75 1.32 3.26Normative Cost 4.92 29.7 31.72 33.88 36.19 38.65
Baramura gas based thermalpower plant (BGTPP)Actual Operation & MaintenanceCost
Employee Cost 2.11 2.26 2.83Repair & Maintenance 2.66 (0.1) 5.24
A&G Cost 1.07 0.28 1.53Normative Cost 5.85 19.8 21.15 22.59 24.12 25.77
Gumti Hydro Electric Plant(GHEP)Actual Operation & MaintenanceCost
Employee Cost 2.94 1.92 2.36
Repair & Maintenance 0.15 0.34 0.24
A&G Cost 0.28 0.23 0.21
Normative cost 3.38 2.48 2.81 3Total O&M cost claimed 14.16 51.98 55.68 59.47 3.20 3.41
35. The total employee cost has increased to a huge extent in 2017-18. This is because of the impact of the 7th
Pay Commission which resulted in an average increase of the employee pay by 22% from April to June2017. There was a further revision of salary for selected staff in 2018-19 leading to an average increase ofaround 8%.
36. It is noted that actual O&M cost of each plants of TSECL booked in account statements of previous yearsare currently much less as compared to normative O&M cost. This is because the cost of periodic plannedmaintenance like CIBI, Major Inspection etc. is not being booked under R&M works but are booked asCapex and other R&M activities undertaken under disaster management is also not booked under R&M
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expenses resulting in understatement of R&M expenses in accounts. As such, the normative expenseshave been claimed in this petition.
37. There was a hike in A&G expenses in 2017-18. This has been majorly contributed by the increase in thecomputer maintenance expenses due to aging of systems and most systems being out of warranty.
4.6.3. Interest on Working Capital38. The details of interest on Working capital have already been explained in section 5.7in detail.
4.6.4. Depreciation39. For the calculation of depreciation, the depreciation rates have been taken from Tariff Regulation (Multi
Year Tariff) 2015on the gross asset value. However, in account statement depreciation have beencalculated as per depreciation rate provided in Companies Act 2013 i.e. based on the useful life.
Table 12: Rate of Depreciation as per Tariff Regulation
Particulars Depreciation Rate asper Tariff Regulation
Land 0.00%
Building 3.34%
Plant & Machinery 5.28%
Computer 15.00%
Computer and Office Equipment 15.00%
Office Equipment 6.33%
Furniture 6.33%
Vehicles 9.50%
40. Category wise depreciation calculation for ARR are tabled below:
Table 13: Actual Depreciation (Rs. In Crores)
Particulars DepreciationRate
FY 16- 17 FY 17- 18 FY 18- 19 FY 19-20(Project
ed)
FY 20-21(Project
ed)Rokhia gas based thermal power plant (RGTPP)RokhiaLand 0.00% - - -Building 3.34% 0.11 0.11 0.11 0.11 0.11Plant & Machinery 5.28% 4.71 4.71 4.71 4.71 4.71Computer & Accesaories
15.00% 0.00 0.00 0.00 0.00 0.00
Office Equipment15.00% 0.01 0.01 0.01 0.01 0.01
Furniture6.33% 0.00 0.00 0.00 0.00 0.00
Vehicles 9.50% - - - - -Total
4.82 4.82 4.82 4.82 4.82
Baramura gas based thermalpower plant (BGTPP)Land 0.00% - - - - -Building
3.34% 0.04 0.04 0.04 0.04 0.04
Plant & Machinery 5.28% 2.88 2.88 2.88 2.89
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Particulars DepreciationRate
FY 16- 17 FY 17- 18 FY 18- 19 FY 19-20(Project
ed)
FY 20-21(Project
ed)2.88
Computer & Accessories15.00% 0.00 0.00 0.00 0.00 0.0
Office Equipment6.33% 0.00 0.00 0.00 0.00 0.0
Furniture6.33% 0.00 0.00 0.00 0.00 0.0
Vehicles 9.50% - - - - -Total
2.92 2.92 2.92 2.92 2.93
Gumti Hydro Electric Plant(GHEP)Land 0.00% - - - - -Building 3.34% 0.17 0.17 0.17 0.17 0.17Plant & Machinery 5.28% 0.33 0.33 0.33 0.33 0.33Computer & Accessories 15.00% - - - - -Office Equipment
6.33% 0.00 0.00 0.00 0.00 0.00
Furniture6.33% 0.00 0.00 0.00 0.00 0.00
Vehicles 9.50% - - - - -Total 0.50 0.50 0.50 0.5 0.5
4.6.5. Non-tariff Income41. The other income of TSECL covers mainly interest earned on fixed deposits made in various banks, sale
of tender forms and other miscellaneous income like sale of scrap, sale of tender, meter rent etc. Theseincomes are being separately booked under other income category. Earning from investment and othermiscellaneous incomes are detailed in the table below from the FY 16-17 to FY 20-21. .The actual databased on audited accounts has been tabulated for FY 16-17 to FY 18-19. The figures for FY 19-20 & FY 20-21 has been derived based on previous years’ trends. The non tariff income in FY 2016-17 was slightlyhigher due to booking of prior period items on account of adjustment in depreciation.
Table 14: Non-Tariff Income (In Crores)
Particulars FY 16- 17 FY 17- 18 FY 18- 19 FY 19-20(Projec
ted)
FY 20-21(Project
ed)Rokhia gas based thermal power plant (RGTPP)RokhiaNon Tariff Income 0.69 0.74 0.62 0.59 0.55Baramura gas based thermal power plant (BGTPP)Non Tariff Income - - - - -Gumti Hydro Electric Plant (GHEP)Non Tariff Income 0.77 0.62 0.52 0.43 0.35Total 1.47 1.37 1.14 1.01 0.90
4.6.6. Summary of ARR and Tariff Proposal for the FY 16-17 to FY20-21 including ARR of FY 2015-1642. Based on the details of expenditure and non- tariff income given above and determined in accordance
with TERC tariff regulations, the total annual revenue requirement of FY 15-16 to FY 20-21 is calculated.We are submitting below generation station wise ARR and tariff proposal for FY 2016-17 to FY 2020-21..
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4.6.7. ARR of FY 2015-16Table 15: Summary of Actuals of FY 15-16in Rs. Lakhs
ParticularsActual FY 2015-16
RGTPP BGTPP GHEP Total1. Installed Capacity (MW) 63.00 42.00 10.00 115.002. Generation (MU) 468.78 232.89 21.97 723.643. Auxiliary Consumption 4.69 2.33 0.15 7.17
Net units available for sale (2-3) 464.09 230.57 21.82 716.47
Expenditure1.Fuel Cost 13,519.0 7,882.0 - 21,401.02. Operation & Maintenance Cost 492.9 585.6 338.2 1,416.7Employee Cost 252.9 211.9 294.4 759.2Repair & Maintenance 64.5 266.4 15.6 346.5A&G Cost 175.5 107.4 28.2 311.13.Finance Cost - - - -4. Depreciation 485.6 296.7 59.7 842.05. Interest on Working Capital - - - -
Total Expenditure (1+2+3+4+5) 14,497.5 8,764.4 397.9 23,659.7Add: Return on Equity 1,430.7 908.4 194.0 2,533.1
ARR 15,928.2 9,672.7 591.9 26,192.9Less: Non-Tariff Income 335.4 195.0 30.5 560.8
Net ARR 15,592.8 9,477.7 561.5 25,632.0
4.6.8. Annual Revenue Requirement for the FY 2016-17Table 16: Summary of ARR of FY 16-17 in Rs. Crores
ParticularsFY 2016-17 (Actual)
RGTPP BGTPP GHEP TotalGeneration (MU) 435.86 189.54 40.79 666.19Less: Auxiliary Consumption 1.74 0.90 0.03 2.67Net Generation Available for Sale (In MU) 434.12 188.64 40.76 663.52
Installed Capacity (MW) 63.00 42.00 10.00 115.00PLF 78.98% 51.52% 46.56%Plant Availability Factor 89.1% 61.0% 87.0%ExpenditureFuel Cost 86.49 57.67 - 144.16O & M Cost 29.70 19.80 2.48 51.98Employee Cost 2.67 2.26 1.92Repair & Maintenance 3.13 (0.10) 0.34A&G Cost 1.32 0.28 0.23Finance Cost - - - -Depreciation 4.82 2.92 0.50 8.24Interest on Working Capital 4.25 2.83 0.16 7.24Total Expenditure 125.26 83.22 3.14 211.62
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 21
Return on Equity 14.39 9.44 1.91 25.74ARR 139.64 92.67 4.93 237.36Less: Non-Tariff income 0.69 - 0.77 1.47Net ARR 138.95 92.67 4.27 235.89
4.6.9. Annual Revenue Requirement for the FY 2017-18Table 17: Summary of ARR of FY 17-18in Rs. Crores
Particulars FY 2017-18 (Actual)RGTPP BGTPP GHEP Total
Generation (MU) 408.29 178.57 43.85 630.71Less: Auxiliary Consumption 1.63 0.90 0.03 2.57
Net Genration Available for Sale (In MU) 406.66 177.67 43.82 628.14Installed Capacity (MW) 63.00 42.00 10.00 115.00
PLF 73.98% 48.54% 50.06%Plant Availability Factor 93.4% 46.8% 97.7%
ExpenditureFuel Cost 74.24 49.53 - 123.77
O & M Cost 31.72 21.15 2.81 55.68Employee Cost 3.39 2.83 2.36
Repair & Maintenance 12.50 5.24 0.24A&G Cost 3.26 1.53
Finance Cost - - - -Depreciation 4.82 2.92 0.50 8.24
Interest on Working Capital 4.06 2.71 0.17 6.95Total Expenditure 114.84 76.31 3.49 194.63Return on Equity 14.39 9.47 1.90 25.76
ARR 129.23 85.78 5.27 220.28Less: Non-Tariff income 0.74 - 0.62 1.37
Net ARR 128.48 85.78 4.77 219.03
4.6.10. Annual Revenue Requirement for the FY 2018-19Table 18: Summary of ARR of FY 18-19 in Rs. Crores
ParticularsFY 2018-19 (Actual)
RGTPP BGTPP GHEP TotalGeneration (MU) 439.33 173.61 35.51 648.45
Less: Auxiliary Consumption 1.76 0.63 0.03 2.42Net Genration Available for Sale (In MU) 437.57 172.98 35.48 646.03
Installed Capacity (MW) 63.00 42.00 10.00 115.00PLF 79.61% 47.19% 40.54%
Plant Availability Factor 94.1% 49.1% 86.4%Expenditure
Fuel Cost 130.97 43.79 - 174.76O & M Cost 33.88 22.59 3.00 59.47
Employee CostRepair & Maintenance
A&G CostFinance Cost - - - -Depreciation 4.82 2.92 0.50 8.24
Interest on Working Capital 5.20 2.60 0.18 7.98
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 22
Total Expenditure 174.87 71.89 3.68 250.44Return on Equity 14.39 9.51 1.91 25.80
ARR 189.26 81.40 5.47 276.13Less: Non-Tariff income 0.62 - 0.52 1.14
Net ARR 188.64 81.40 5.07 275.11
4.6.11. Annual Revenue Requirement for the FY 2019-20Table 19: Summary of ARR of FY 19-20 in Rs. Crores
ParticularsFY 2019-20 (Projected)
RGTPP BGTPP GHEP TotalGeneration (MU) 441.08 166.15 33.13 640.36
Less: Auxiliary Consumption 1.76 0.63 0.03 2.42Net Generation Available for Sale (In MU) 439.32 165.52 33.10 637.94
Installed Capacity (MW) 63.00 42.00 10.00 115.00PLF 79.92% 45.16% 37.82%
Plant Availability Factor 94.07% 49.1% 86.37%Expenditure
Fuel Cost 146.2 45.33 - 191.52O & M Cost 36.19 24.12 3.20 63.51
Employee CostRepair & Maintenance
A&G CostFinance Cost - - - -Depreciation 4.82 2.92 0.50 8.24
Interest on Working Capital 5.83 2.82 0.25 8.90Total Expenditure 193.03 75.19 3.95 272.17Return on Equity 14.39 9.52 1.79 25.70
ARR 207.42 84.71 5.74 297.87Less: Non-Tariff income 0.59 - 0.43 1.01
Net ARR 206.83 84.71 5.31 296.86
4.6.12. Annual Revenue Requirement for the FY 2020-21Table 20: Summary of ARR of FY 20-21 in Rs. Crores
ParticularsFY 2020-21 (Projected)
RGTPP BGTPP GHEP TotalGeneration (MU) 442.83 159.02 30.91 632.76
Less: Auxiliary Consumption 1.76 0.63 0.03 2.42Net Generation Available for Sale (In MU) 441.07 158.39 30.88 630.34
Installed Capacity (MW) 63.00 42.00 10.00 115.00PLF 80.24% 43.22% 35.29%
Plant Availability Factor 94.07% 49.1% 86.37%Expenditure
Fuel Cost 146.78 43.38 - 190.16O & M Cost 38.65 25.77 3.41 67.83
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 23
Employee CostRepair & Maintenance
A&G CostFinance Cost - - - -Depreciation 4.82 2.93 0.50 8.25
Interest on Working Capital 5.70 2.74 0.26 8.70Total Expenditure 195.95 74.81 4.17 274.93Return on Equity 14.39 9.53 1.79 25.71
ARR 210.34 84.34 5.95 300.64Less: Non-Tariff income 0.55 - 0.35 0.90
Net ARR 209.78 84.34 5.60 299.73
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 24
5. ARR for Transmission &DistributionBusiness of TSECL for MYT ControlPeriod (FY 2016-17 to FY 2020-21) including ARR ofFY 2015-16
5.1. Introduction43. This section deals with the Aggregate Revenue Requirement (ARR) of transmission& distribution
business of TSECLfor the MYT control period ofFY 2016-17toFY 2020-21 including ARR of FY 2015-
16.TSECL has calculated the ARR and tariff requirements for transmission & distribution of power within
the State as per theTERC Tariff Regulations (Multi Year Tariff), 2015.TSECL is proposing a five
control period from FY 2016-17 to FY 2020-21.. Based on the experience of the MYT framework during
this control period, the second control period would be appropriately taken.
44. TSECL is filing its AggregateRevenue Requirement (ARR) and Tariff Petition for transmission and
distribution business for the first timeseparately from generation business before the Hon’ble
Commission as a step towards unbundling in power sector of Tripura.A new company named Tripura
Power Generation Limited (TPGL)has been formed with all generation assets of TSECL with effect
from June, 2015. Also, it is submitted that TSECL has not yet segregated the account statements for
generation, transmission and distribution business completely and the same is work in progress. The
break-up of costs in generation, transmission and distribution business, wherever necessary for ARR and
tariff calculation, have been done based on the division wise break-up of account statements and making
suitable assumptions, as necessary, for the common functions like accounts and finance, HR, projects etc.
at corporate level.
45. As on date, the statutory audit of the account statements till FY 2015-16and FY 2016-17 has been
completed.The provisional account statements of FY 17-18 and FY 18-19 are available. The ARR is
calculated based on the actual data available of FY 16-17 to FY 18-19. The ARR of FY 19-20 & FY 20-21
have been projected based on the trends of previous years and norms specified in the TERC Tariff
Regulations(Multi Year Traiff),2015.
46. The detailed schedules and formats of the Revenue Requirement Form from FY 16-17 to FY 20-21are
given in the subsequent sections.
5.2. Category wise Projection for growth in No. ofConsumers
1. The following table shows the no. of consumers for FY 2015-16 to FY 2018-19. There has been a slight
reduction in industrial sales in FY 2018-19 due to slowness in economic growth and increase in captive
consumption. Moreover, there has been a rapid increase in RGGVY/Kuti Jyoti connections due to the
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 25
implementation of various rural electrification schemes like RGGVY, DDUGJY and Saubhagaya scheme
(of late).
Table 1: Growth in Number of Actual Connected Consumers
Category FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
Kutirjyoti 14835 16258 17699 17700RGGVY 12286 15963 27671 31270Domestic 576112 611392 641502 692386Commercial 58125 56019 58933 59897Irrigation 5206 5286 5943 6328Public water works 4863 5553 5810 6195Industries 5080 5069 5408 5218Tea, Coffee & Rubber Garden 35 37 39 41Bulk supply 885 871 905 963Public Lighting 1347 1912 2018 2094Mobile Towers 1078 1241 1302 1350Total 652731 687380 721860 774472
5.3. Category wise growth in Sales1. The category wise actual growth in Units Sold is shown in the table below. The overall sales in FY 2018-19
have reduced because of the increase in LT: HT ratio of sales and consequent increase of T&D losses.
Table 2: Actual Growth in Sales
All figures are in Million Units (MUs)
Sl.No.
Category FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
1. Kutirjyoti 10.5 11.24 16.87
2. RGGVY 10.3 11.04
3. Domestic 420.78 454.17 486.37 470.06
4. Commercial 74.92 78.66 84.24 57.2
5. Industrial 43.01 45.1 48.29 40.1
6. Irrigation 33.91 35.96 38.51 31.67
7. Public Lighting 39.71 42.28 45.28 53.73
8. Public Water Works &Sewage disposal
79.35 82.12 87.95 62.03
9. Tea, Coffee & RubberGarden
76.85 1.14 1.23 1.45
10. Bulk Supply 75.75 80.34 86.04 102.09
11. Mobile Towers 25.52 25.99 27.84 33.03
12. Total: 813.05 866.56 928.01 868.23
5.4. Transmission and Distribution Loss1. The table below highlights the Actual T&D losses for FY 2016-17 to FY 2018-19 and the projected
figures for FY 2019-20 & FY 2020-21 :
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 26
Table 3: T&D Loss for MYT Period
Particulars FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
FY 2019-20(Projecte
d)
FY 2020-21(Projecte
d)
Distribution Loss (%) 26.77% 22.5% 22.3% 31.3% 26.4% 24.4%
Transmission Loss (%) 6.00% 6.00% 6.00% 6.00% 6.00% 6.00%
T&D Losses (%) 31.16% 27.17% 26.92% 35.42% 30.84% 28.90%
2. The Petitioner submits that high level of T&D loss, is due to increase in the LT:HT ratio as a result
of extensive village electrification, new service connection in remote areas over the years, huge
increase in the last mile connectivity and LT network etc. During this period, the state has also seen
a number of severe gayles and thunderstorms resulting in damage to the electrical network and
increasing load on the electrical network thereby increasing technical losses. TSECL has been
suffering from old ageing and overloaded assets like transformers/lines due to limited investment
in strengthening and upgradation of distribution network particularly in HT network of 33 kV and
11 kV.
3. TSECL is making sincere efforts in electrifying the un-electrified areas of the state at a fast pace
under grants and loans provided by the Rural Electrification Corporation (REC) under the Rajiv
Grandhi Gramin Viduyatikaran Yojna (RGGVY) and Saubhagya Scheme. Through the
implementation of the scheme the TSECL has provided the electricity to the far flung areas and
villages to of the Tripura state. At the same time, due to increase in the LT network and the
domestic and Kutir Jyoti consumers, losses of the utility are also increasing at considerable pace.
Through different loss reducing measures and schemes the TSECL has remained successful to
contain the losses at the level mentioned in the Petition.
4. In light of above made submission, we therefore request the Hon’ble Commission to approve the
above projected T&D losses of the TSECL.
5.5. Energy Balance1. Based on the T&D Loss above the energy balance for FY 2016-17 to FY 2020-21 has been calculated
and shown in the table below:
2. It may be noted that TSECL presently has an agreement for sale of power to Bangladesh sale till the
end of FY 2020-21 and as such, the same has ben considered in the projections. However, the
energy balance and financial projections for TSECL is expected to be heavily impacted
if the sale to Bangladesh does not continue further beyond FY 2020-21 and the gap
between cost and revenue will increase significantly in such a scenario.The Hon’ble
Commission is requested to take the dynamic situation for TSECL based on the sale to Bangaldesh
while approving the ARR projections of TSECL
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 27
Table 4: Energy Balance for MYT Period
All figures are in Million Units (MUs)
Particulars FY2016-17
FY2017-18
FY 2018-19
FY 2019-20(Projected)
FY 2020-21(Projected)
Remarks
Energy fromCGS
1812.82 2321.22 2629.92 2629.92 2629.92 Increase due to new plants likeMonarchak, Bongaigaon and increasedgeneration from Pallatana. Projectedfigures for FY 19-20 & FY 20-21 are
assumed same as FY 18-19.Inter State Sales 1363.46 1709.29 1880.45 1880.45 1880.45 Projected figures for FY 19-20 & FY 20-
21 are assumed same as FY 18-19.Energy Trading 0.44 10.86 0.34 0.34 0.34 Pallatana going for planned
maintenance for 1 month in17-18 and 10 days in 18-19during which a swappingarrangement was made,swapping with Mizoramduring Christmas/puja.
Projected figures for FY 19-20 & FY 20-21 are assumed
same as FY 18-19.Energy
Swapping1.11 1.38 5.08 5.08 5.08 Increased deviations due to
Bangladesh powerfluctuations. Projected
figures for FY 19-20 & FY20-21 are assumed same as
FY 18-19.UI 52.55 76.13 106.26 106.26 106.26 Projected figures for FY 19-
20 & FY 20-21 are assumedsame as FY 18-19.
Sale to Mizoram 73.53 41.26 41.60 41.6 41.6 Projected figures for FY 19-20 & FY 20-21 are assumed
same as FY 18-19.Sale to Manipur 73.53 41.26 41.57 41.57 41.57 Projected figures for FY 19-
20 & FY 20-21 are assumedsame as FY 18-19.
IEX 524.13 595.93 679.68 679.68 679.68 Surplus power sold in IEX.Projected figures for FY 19-20 & FY 20-21 are assumed
same as FY 18-19.Bangladesh Sale 638.16 942.45 1005.92 1005.92 1005.92 Bangladesh sale removed
from Input (ConsideredInter-State Sales). Projected
figures for FY 19-20 & FY20-21 are assumed same as
FY 18-19.Inter State
TransmissionLoss
87.79 85.34 101.30 101.30 101.30 As per NERLDC data.Projected figures for FY 19-20 & FY 20-21 are assumed
same as FY 18-19.Power Purchase
from OtherSources
168.59 113.44 53.25 53.25 53.25 Projected figures for FY 19-20 & FY 20-21 are assumed
same as FY 18-19.ISGS Energy atState Bus (MU)
530.16 640.03 701.42 701.42 701.42
Energy fromState
Generation
659.63 629.79 642.99 640.36 632.76 As per projection shown ingeneration section
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 28
Particulars FY2016-17
FY2017-18
FY 2018-19
FY 2019-20(Projected)
FY 2020-21(Projected)
Remarks
Energy at StateBus
1189.79 1269.82 1344.40 1341.78 1334.18
Intra StateTransmission
Loss
71.39 76.19 80.66 80.51 80.05Assumed 6% loss
Energy at 11 kVlevel
1118.41 1193.63 1263.74 1261.27 1254.13
Energy Sales 866.56 928.01 868.23 928.01 948.55 FY 19-20 and FY 20-212projected sales based on past
trendsDistribution
Loss251.84 265.62 395.51 333.26 305.58
DistributionLoss (%)
22.5% 22.3% 31.3% 26.4% 24.4%
T&D Loss (%) 27.17% 26.92% 35.25% 30.84% 28.90% Inclusive of TransmissionLoss
5.6. Power Purchase1. TSECL procures power from NEEPCO, NHPC, NTPC and OTPC. TSECL is receiving power from
OTPC Palatana since Jan 2014.
2. The following table shows the power procurement cost for FY 2016-17 to FY 2018-19 and the
subsequent table shows the cost of FY 2019-20 and FY 2020-21:
Table 5: Power Purchase Cost for MYT Period
All figures are in Rs. Crores
PowerPurchaseData
2016-17 2017-18 2018-19
Cost(INRcrores)
EnergyPurchased(MUs)
CostPerUnit(INRperunit)
Cost(INRcrores)
EnergyPurchased(MUs)
CostPerUnit(INRperunit)
Cost(INRcrores)
EnergyPurchased(MUs)
CostPerUnit(INRperunit)
NEEPCO 178.09 584 3.05 343.66 1063.96 3.23 372.60 1070.8 3.59
NHPC 22.73 83.64 2.72 25.49 94.42 2.70 22.52 67.42 3.28
NTPC 37.98 41.5 9.15 88.86 111.27 7.99 130.93 249.72 5.24
OTPC 348.86 1097 3.18 339.47 1044.90 3.27 373.99 1235 3.10
NEEPCOSolar 2.00 6.962 2.87 1.93 6.66 2.90 2.06 7.05 2.92
IEX 3.46 12.74 2.71 4.21 15.30 2.75 3.12 10.82 2.88
Trading/Swapping 1.20 5.348 2.25 4.82 21.90 2.20 1.42 4.183 3.39
DSM 36.58 150.5 2.43 18.30 76.24 2.40 7.54 38.24 1.97
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 29
Inter StateTransmissionCharges
53.49 0.27 55.48 0.23 52.63 0.20
Prior PeriodItems 3.17
TOTAL 687.56 1981 3.47 882.22 2434.65 3.62 966.81 2683.16 3.60
PowerPurchaseData
2019-20 2020-21
Cost(INRcrores)
EnergyPurchased(MUs)
CostPerUnit(INRperunit)
Cost(INRcrores)
EnergyPurchased(MUs)
CostPerUnit(INRperunit)
NEEPCO 383.78 1070.78 3.58 395.29 1070.78 3.69
NHPC 23.20 67.42 3.44 23.89 67.42 3.54
NTPC 134.86 249.72 5.40 138.90 249.72 5.56
OTPC 385.21 1234.95 3.12 396.77 1234.95 3.21
NEEPCOSolar
2.12 7.05 3.01 2.18 7.05 3.10
IEX 3.21 10.82 2.97 3.31 10.82 3.06
Trading/Swapping
1.46 4.183 3.50 1.51 4.183 3.60
DSM 7.77 38.24 2.03 8.00 38.24 2.09
Inter StateTransmissionCharges
54.21 0.20 55.84 0.21
Prior PeriodItems
TOTAL 995.81 2683.16 3.71 1025.69 2683.16 3.82
3. There was commencement of generation of 100 MW from NEEPCO Monarchak from Dec’16 which
has caused the power purchase cost of NEEPCO to increase from FY 17-18. The second unit of NTPC
Bongaigaon Plant was completed on March’18. The allocation for Tripura was 23 MW which was
added from FY 18-19 onwards. OTPC Palatana is generating at full capacity from June’18 due to
better availability of gas which has resulted in an additional supply of 200 MUs in FY 18-19.
4. The Hon’ble Commission is requested to approve the power purchase cost of Rs. 687.56 Crore for
FY 2016-17,Rs. 882.22 Crore for FY 2017-18 andRs. 966.81 Crore for FY 2018-19. The power
purchase cost for FY 2019-20 and FY 2020-21 has been projected based on the actual source wise
generation observed in FY 2018-19 and escalating the average rate for power purchase rate by 3 %
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 30
each year in FY 2019-20 and FY 2020-21 based on the trend observed in the last few years. There is
no new generation capacity expected to be added or disposed during the projected period.
5.7. Transmission Charges1. The following table shows the Inter State and Intra State transmission charges for FY 2016-17 to FY
2020-21.
Table 6: Transmission Charge for MYT Period
All figures are in Rs. Crore
Transmission Charge FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20
FY 2020-21
Inter State 53.49 55.48 52.63 54.21 55.84
Intra State 32.65 32.57 33.56 35.09 36.15
Total 86.14 88.05 86.19 89.30 91.99
2. The Hon’ble Commission is requested to approve thetransmission charge as detailed above.
5.8. O&M Expenses1. TERC Tariff Regulations, 2015 stipulates the O&M cost to be comprising of Employee cost, R&M
expense and A&Gexpense.
2. The total employee cost has increased to a huge extent in 2017-18 by around 27%. This is because of
the impact of the 7th Pay Commission which resulted in an average increase of the employee pay by
22% from April 2017 (Salary Level increased from 1.88 to 2.25 of basic pay level). There was a
further revision of salary for selected staff in 2018-19 from Oct’18 leading to an average increase of
8% in monthly employee cost (Salary Revised from 2.25 to 2.57 of basic pay on an average).The
total employee cost for FY 19-20 & FY 20-21 has been escalated by the current average CPI
escalation rate (4.22%) on previous year’s data. The employee cost for FY 19-20 has been
additionally increased by 3% due to the remaining impact of 7th Pay Commission implemented
during mid of last year and full year impact coming in FY 19-20.
3. Besides, the employees cost during FY 2015-16 also increased due to recruitment of 531 number of
staff which resulted in average increase of employee cost by around 11% in FY 2015-16. The year
wise actual number of employees, number of recruitments and retirements from FY 14-15 to FY 18-
19 is shown in the table given below:
Particulars 2014-15 2015-16 2016-17 2017-18 2018-19
Employee Cost in INR crores 111.77 128.47 131.57 166.94 178.54
YoY Increase 14.9% 2.4% 26.9% 6.9%
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 31
Justification
Number of employees at the startof the year 3992 3869 4283 4119 4018
New Recruitments 0 531 0 50 3
Retirements 123 117 164 151 173
Employees at the end of the year 3869 4283 4119 4018 3848
% Estimate Increase due to VIIPaY 0.0% 22.0% 4.0%
4. Regarding R&M expenses, it is submitted that the overall expenses during the past years have been
quite low i.e around 1% of the Gross Fixed Asset Value. The key reasons for this are:
Accounting has been done on cash basis resulting in under booking and there is a huge
amount of liabilities (unpaid bills) which are not being booked.
The grants received for disaster management have been used for various R&M works but
have been booked under Capex instead of R&M expenses.
5. The actual O&M expense for FY 16-17 to FY 18-19 and the projected figures for FY 19-20 and FY 20-
21 for transmission and distribution business is provided below:
Transmission Business
Table 7: O&M Expense for Transmission Business for MYT Period
All figures are in Rs. Crore
O&M Expense Transmission
Particulars FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21Employee Cost 13.87 15.73 16.59 17.78 18.53R&M Cost 2.79 1.53 1.54 1.56 1.59A&G Cost 2.60 1.80 1.90 1.98 2.06Total 19.26 19.06 20.03 21.33 22.19
Distribution Business
Table 2: O&M Expense for Distribution Business for MYT Period
All figures are in Rs. Crore
O&M Expense Distribution
Particulars FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21Employee Cost 110.86 142.63 150.41 161.26 168.05R&M Cost 18.27 8.19 8.21 8.23 8.25A&G Cost 19.24 17.27 18.21 18.99 19.80Total 148.37 168.09 176.83 188.49 196.12
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 32
5.9. GFA and Depreciation1. The Gross Fixed Assets (GFA) and depreciation for TSECL is taken from the account statements of
respective years. The Petitioner has considered the depreciation in the following manner:
full year depreciation on the opening balance of GFA
reduction of depreciation on assets which are fully depreciated
reduction of depreciation on assets created out of government grants
2. It is further submitted that the “Annexure: 8” to the TERC Regulations (Multi Year Tariff), 2015
specifies the depreciation rate to be charged on each class of asset.
Table 8: Depreciation Rate as provided in ‘Annexure-8’ of the TERC Regulations (Multi Year Tariff), 2015
Asset Depreciation Rate(Salvage
Value=10%)- SLM
Land under full ownership 0.00%
Building 3.34%
Plant & Machinery 5.28%
Computer 15.00%
Computer and Office Equipment 15.00%
Office Equipment 6.33%
Furniture 6.33%
Vehicles 9.50%
3. The following table shows the GFA added for FY 2016-17 to FY 2018-19 and the projected
depreciation for FY 19-20 & FY 20-21for the transmission and distribution business of TSECL.
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 33
Transmission Business
Table 9: Depreciation for Transmission Asset calculated as per TERC Regulations (Multi Year Tariff), 2015
All figures are in Rs. Crore
Particulars
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
Open
Add.
Close
Avg.
Dep.
Open
Add. Close
Avg.
Dep.
Open
Add.
Close
Avg. Dep.
Open
Add.
Clos
e
Avg.
Dep.
Open
Add.
Clos
e
Avg.
Dep.
Land 10.93 0.0
6
10.99 10.9
6
0.00 10.9
90.0 10.99 10.9
9
0.00 10.99 0.03 11.02 11.0 0.0
0
11.02
0.05
11.07
11.04
- 11.07
0.08
11.15
11.11
-
Building1.32 1.32 1.32 0.0
41.32 0.42 1.74 1.53 0.04 1.74 0.19 1.92 1.83 0.0
4
1.92
0.31
2.24
2.08
0.04
2.24
0.51
2.75
2.49
0.05
Plant &Machinery 138.1
81.4
7139.6
5138.
923.0
9139.
65 0.28 139.93
139.79 3.11 139.9
3 0.94 140.87 140.4 3.1
140.87
1.55
142.42
141.65
3.13
142.42
2.55
144.9
7
143.6
9
3.18
Computer&Accessories
0.18 0.0 0.18 0.18 0.02 0.18 0.0 0.18 0.18 0.01 0.18 0.01 0.19 0.19 0.01
0.19
0.01
0.19
0.19
0.01
0.19
0.01
0.21
0.20
0.01
OfficeEquipment 0.15 0.0
3 0.18 0.17 0.03 0.18 0.02 0.21 0.39 0.04 0.21 0.03 0.24 0.22 0.0
30.2
40.0
50.2
80.2
60.0
40.2
80.0
80.3
60.3
20.0
5Furniture
0.21 00 0.22 0.22 0.09 0.22 0.0 0.22 0.22 0.02 0.22 0.0 0.22 0.22 0.0
20.2
20.0
00.2
20.2
20.0
20.2
20.0
00.2
20.2
20.0
2Vehicles - - - - -
Total 150.98
1.56
152.54
151.76
3.19
152.54 0.72 153.2
6152
.9 3.21 153.26 1.19 154.4
6153.8
6 3.2 3.24
3.30
Distribution Business
Table 10: Depreciation for Distribution Asset calculated as per TERC Regulations (Multi Year Tariff), 2015
All figures are in Rs. Crore
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019 - 20 FY 2020-21
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 34
Particulars
Open
Add.
Close
Avg.
Dep.
Open
Add.
Close
Avg.
Dep.
Open
Add.
Close
Avg. Dep.
Open
Add.
Clos
e
Avg.
Dep.
Open
Add.
Clos
e
Avg.
Dep
.Land 36.5
40.0 36.5
436.5
40.00 36.5
40.26 36.8 36.6
70.00 36.8 0.12 36.9
236.86 0.0
036.92
0.13 37.05
36.98
- 37.05
0.14
37.19
37.12
-
Building 14.89
0.0 14.89
14.89
0.24 14.89
0.03 14.92 14.91 0.24 14.92 0.01 14.93 14.93 0.24
14.93
0.02
14.95
14.94
0.24
14.95
0.02
14.97
14.96
0.24
Plant &Machinery
553.32
0.74 554.07
553.69
5.3 554.07
1.05 555.11
554.59
5.32 555.11
0.89 556 555.56
5.31 556 0.97
556.97
556.48
5.32
556.97
1.05
558.0
2
557.49
5.33
Computer &Accessories
3.95 0.24 4.2 4.07 0.27 4.2 0.15 4.34 4.27 0.22 4.34 0.2 4.54 4.44 0.24
4.54
0.22
4.76
4.65
0.26
4.76
0.24
5.00
4.88
0.27
OfficeEquipment
0.36 0.08 0.44 0.4 0.07 0.44 0.02 0.47 0.45 0.07 0.47 0.06 0.52 0.49 0.07
0.52
0.06
0.58
0.55
0.08
0.58
0.07
0.65
0.61
0.09
Furniture 0.96 0.03 0.98 0.97 0.05 0.98 0.02 1.01 1.00 0.05 1.01 003 1.03 1.02 0.05
1.03 0.03
1.06 1.05 0.05
1.06
0.03
1.09
1.08
0.06
Vehicles 0.32 0.0 0.32 0.32 0.0 0.32 0.0 0.32 0.32 0.0 0.32 0.0 0.32 0.32 0.0 0.32
- 0.32
0.32
- 0.32
- 0.32
0.32
-
Total 610.34
1.1 611.43
610.88
5.94 611.43
1.53 612.96
612.2
5.91 612.96
1.3 614.26
613.61
5.92
614.26
1.42
615.68
614.97
5.96
615.68
1.55
617.2
3
616.
46
5.99
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 35
5.10. Interest and Finance ChargesTSECL does not have any long term loans. However, the finance charges such as guarantee charge, bank
commission for Letter of Credit etc. have been shown under interest and finance charges. The interest on
Term Loans and Finance Charges from FY 2014-15 to FY 2020-21 have been detailed as under:
Table 9: Interest on Finance Charges (In Crores)
Particulars 2014-15 2015-16 2016-17 2017-18 2018-19 2019-20
2020-21
Interest on Finance Charges 0.08 0.07 0.11 0.16 0.20 0.25 0.32
5.11. Interest on Working Capital1. The TERC Tariff Regulation (Multi Year Tariff), 2015 provides for normative interest on working Capital
based on the methodology outlined in the Regulations. The Petitioner is eligible for interest on working
capital worked out on methodology specified in the Regulations for transmission and distribution
business as provided below:
i. Receivables equivalent to two months of fixed cost;
ii. Maintenance spares @ 15% of operation and maintenance expenses specified in Clause 31; and
iii. Operation and maintenance expenses for one month.
2. In accordance with the TERC Tariff Regulations (Multi Year Tariff), 2015, the interest on the working
capital requirement would be the SBI Base Rate plus 300 basis points as on 1st April of the year for which
tariff is determined. The Petitioner in the instant Petition has considered the interest rate on working
capital requirement at 12.30% for FY 2016-17, 12.1% for FY 2017-18 ,11.7% for FY 2018-19, 12.05% for FY
2019-20 & 11.45% for FY 2020-21.
3. The Petitioner in accordance with the above mentioned Regulations, calculated the interest on working
capital as shown in the table below:
Transmission Business
Table 10: IoWC calculation for Transmission Business
All figures are in Rs. Crores
Particulars FY2016-17
FY2017-18
FY2018-19
FY 2019-20(Projected)
FY 2020-21(Projected)
Receivables (2 month) 5.44 5.43 5.59 5.84 6.02Maintenance Spares 2.89 2.86 3.00 3.20 3.33O&M Expense 1.60 1.59 1.67 1.78 1.85Working Capital 9.94 9.88 10.27 10.83 11.20Rate of Interest 12.30% 12.10% 11.70% 12.05% 11.45%Interest on Working Capital 1.22 1.19 1.20 1.30 1.28
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 36
Distribution Business
Table 11: IoWC calculation for Distribution Business
All figures are in Rs. Crore
Particulars FY2016-17
FY2017-18
FY2018-19
FY 2019-20(Projected)
FY 2020-21(Projected)
Receivables (2 month) 110.45 96.58 111.17 118.48 121.52Maintenance Spares 22.26 25.21 26.52 28.27 29.42O&M Expense 12.36 14.01 14.74 15.71 16.34Working Capital 145.07 135.8 152.43 162.46 167.29Rate of Interest 12.30% 12.10% 11.70% 12.05% 11.45%Interest on Working Capital 17.84 16.43 17.83 19.58 19.15
5.12. Return on Equityand Tax on Return on Equity1. The Regulation 26 of the TERC Tariff Regulation (Multi Year Tariff) 2015 provides for Return on
Equity(RoE) @15.5% on equity base. The amount of equity base to be considered for calculation of
return has been considered based on the relevant clause (clause 21) of Tariff Regulation (Multi Year
Tariff) 2015. The relevant extract of the regulations are as under:
“26. Return on Equity:
I. Return on equity shall be computed in rupee terms, on the equity base determined
inaccordance with Clause 21.
II. Return on equity shall be computed at the base rate of 15.50% for thermal generating
stations, transmission/distribution system including communication system and run
ofthe river hydro generating station, and at the base rate of 16.50% for the storage type
hydro generating stations and run of river generating station with pondage:”
“21. Debt-Equity Ratio:
I. For a project declared under commercial operation on or after the date of publication of
this regulation on the Official Gazette, the debt-equity ratio would be considered as 70:30
as on COD. If the equity actually deployed is more than 30% of the capital cost, equity in
excess of 30% shall be treated as normative loan:
Provided that:
i. where equity actually deployed is less than 30% of the capital cost, actual equity shall
be considered for determination of tariff:
ii. the equity invested in foreign currency shall be designated in Indian rupees on the
date of each investment:
iii. any grant obtained for the execution of the project shall not be considered as a part of
capital structure for the purpose of debt : equity ratio.”
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 37
2. It may be noted that the Commission in its past orders had considered equity base for the transmission
and distribution business as 30% of the Gross Fixed Asset Value and as such the same is considered here
for the purpose of calculation of RoE. Equity fund of TSECL is calculated after allocating equity fund of
TSECL in the Gross fixed assets ratio among generation, transmission and distribution business.
3. The return on equity has been computed on projected paid up capital is summarized in the table given
below:
Transmission Business
Table 12: Return on Equity calculation for Transmission Business
All figures are in Rs. Crore
Particulars FY 2016-17
FY 2017-18
FY 2018-19
FY 2019-20(Projected)
FY 2020-21(Projected)
Equity fund(Allocated based onassets ratio)
103.34 103.49 103.91 103.49 103.49
Opening GFA 150.98 152.54 153.26 154.46 156.42Closing 152.54 153.26 154.46 156.42 159.65Average 151.76 152.90 153.86 155.44 158.03Normative Equity(30% of GFA)
45.53 45.87 46.16 46.63 47.41
Equity consideredfor RoE (Min ofactual andnormative)
45.53 45.87 46.16 46.63 47.41
Distribution Business
Table 13: Return on Equity calculation for Distribution Business
All figures are in Rs. Crore
Particulars FY 2016-17
FY 2017-18
FY 2018-19 FY 2019-20(Projected)
FY 2020-21(Projected)
Equity fund(Allocated based onassets ratio)
315.83 315.88 317.15 315.86 315.85
Opening GFA 610.34 611.43 612.96 614.26 615.68Closing 611.43 612.96 614.26 615.68 617.23Average 610.88 612.20 613.61 614.97 616.46Normative Equity(30% of GFA)
183.27 183.66 184.08 184.49 184.94
Equityconsidered forRoE (Min ofactual andnormative)
183.27 183.66 184.08184.49 184.94
4. Regulation 27 of TERC Tariff Regulation (Multi Year Tariff) 2015 provides for grossing up of base rate of
return on equity with the effective tax rate of the respective financial year and the effective tax rate shall
be computed as per the following formula.
“Rate of pre-tax return on equity = Base rate / (1-t)
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 38
Where “t” is the effective tax rate in accordance with Clause (I) of this regulation and shall be
calculated at the beginning of every financial year based on the estimated profit and tax to be paid
estimated in line with the provisions of the relevant Finance Act applicable for that financial year to
the company on pro-rata basis by excluding the income of non-generation or non-
transmission/distribution business, as the case may be, and the corresponding tax thereon. In case of
generating company or the Transmission or the Distribution licensee paying Minimum Alternate Tax
(MAT), “t” shall be considered as MAT rate including surcharge and cess.”
5. The Petitioner has consideredMinimum Alternative Tax (MAT Rate)of 21.91% rate for calculation of pre-
tax RoE as shown below:
Transmission Business
Table 14: Calculation of Annualized RoE on Pre-tax basis for Transmission Business
All figures are in Rs. Crore
Particulars
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20(Projected)
FY 2020-21(Projected)
Equityconsidered forRoE 45.53 45.87 46.16
46.63 47.41
Rate of RoE 15.50% 15.50% 15.50% 15.50% 15.50%Effective TaxRate 21.91% 21.91% 21.91% 21.91% 21.91%
Effective RoE (%)on Pre-tax basis 19.85% 19.85% 19.85% 19.85% 19.85%
AnnualizedRoE on Pre-taxBasis
9.04 9.1 9.169.26 9.41
Distribution Business
Table 15: Calculation of Annualized RoE on Pre-tax basis for Distribution Business
All figures are in Rs. Crore
Particulars
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20(Projected)
FY 2020-21(Projected)
Equityconsidered forRoE
183.27 183.66 184.08184.49 184.94
Rate of RoE 15.50% 15.50% 15.50% 15.50% 15.50%Effective TaxRate 21.91% 21.91% 21.91% 21.91% 21.91%
Effective RoE (%)on Pre-tax basis 19.85% 19.85% 19.85% 19.85% 19.85%
AnnualizedRoE on Pre-taxBasis
36.38 36.45 36.5436.62 36.71
5.13. Non-tariff IncomeThe other income of TSECL covers mainly interest earned on fixed deposits made in various banks
and as detailed under the head above, and other miscellaneous income like sale of scrap, sale of
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 39
tender, meter rent etc.These incomesare being separately booked under other income
category.The non tariff income in FY 2016-17 was higher because of booking of prior period items
due to adjustment of depreciation.
Transmission Business
Table 16: Non-tariff Income for Transmission Business
All figures are in Rs. Crore
Particulars
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
Non-tariffIncome
0.06 0.0 0.03 0.03 0.03
Distribution Business
Table 17: Non-tariff Income for Distribution Business
All figures are in Rs. Crore
Particulars
FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21
Non-tariffIncome 34.84 33.03 29.00 26.46 24.14
5.14. Provision for Bad and Doubtful debtsTSECL during this period has introduced Surcharge Waiver scheme two times, one in FY 2015-16 for
Government Consumers and another in FY 2017-18 for Private Consumers. This scheme was introduced to
increase revenue collection of old arrears. Under this scheme, the delayed payment surcharge accrued on
arrears was waived if the consumer paid the balance amount. In this way, consumer was also incentivized for
clearing the old outstanding dues which accrued over a period of time. As a result of this scheme, TSECL had to
waive off surcharge amount of the corresponding balance dues paid by the consumers and the waived off
amount has been booked in account statements as Waived off Bad debts . TERC MYT Regulations 2015 also has
provision for claiming provision for bad and doubtful debts. As such, TSECL has claimed the amounts waived
off in FY 2015-16 and FY 2017-18 under surcharge waiver scheme, which is shown below:
Particulars FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20 FY 2020-21Provision for badand doubtful debts
16.500.00
1.97 0.03 0.00 0.00
5.15. Aggregate Revenue RequirementBased on the details of expenditure and non- tariff income discussed above, the aggregate revenue
requirement of FY 2016-17 to FY 2020-21 is calculated. The following table shows the total ARR
for FY 2016-17 to FY 2020-21.
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 40
Transmission Business
Table 18: Aggregate Revenue Requirement for Transmission Business
S.No.
Particulars Units FY2015-16
FY2016-17
FY2017-18
FY2018-19
FY 2019-20(Projected)
FY 2020-21(Projected)
A Fixed Charge
1 O & M Expenses Rs. Crore 18.15 19.26 19.06 20.03 21.33 22.19
2 Depreciation Rs. Crore 2.91 3.19 3.21 3.20 3.24 3.30
3 Interest on WorkingCapital Loans
Rs. Crore 1.37 1.22 1.19 1.20 1.30 1.28
4 Return on Equity Rs. Crore 8.99 9.04 9.10 9.16 9.26 9.41
5 Total Fixed Charge Rs.Crore
31.43 32.71 32.58 33.59 35.13 36.18
6 Less: Non‐TariffIncome
Rs. Crore 3.92 0.06 0.01 0.03 0.03 0.03
7 Total Cost Rs.Crore
27.51 32.65 32.57 33.56 35.09 36.15
B Total unit transmittedor wheeled
MUs 1181.15
1189.79 1269.82 1344.40
1341.78 1334.18
C Transmission andWheeling Charge
Paisa/kwh
23.29 27.44 25.65 24.96 26.16 27.10
# Fees for filing tariff Petition has been considered under A&G expense
Distribution Business
Table 19: Aggregate Revenue Requirement for Distribution Business
S.No. Particulars Units FY2015-16
FY 2016-17
FY 2017-18
FY 2018-19
FY 2019-20(Projected)
FY 2020-21(Projected)
A Fixed Charge
1 Power Purchase Cost Rs.Crore
549.44 634.12 822.9 914.18 941.61 969.85
Inter State TransmissionCharges
Rs.Crore
32.23 53.49 51.48 52.63 54.21 55.84
Power Purchase CostAdjustment (Prior Period)
Rs.Crore
36.91 0.00
2 Intra State TransmissionCharges
Rs.Crore
27.51 32.65 32.57 33.56 35.09 36.15
3 Cost of State own/ TSECLGeneration
Rs.Crore
155.92 235.89 219.03 275.11 296.86 299.73
4 O & M Expenses Rs.Crore
130.05 147.86 167.59 176.53 188.05 195.71
5 Depreciation Rs.Crore
8.26 5.94 5.91 5.92 5.96 5.99
6 Interest on Term Loans &Fin. Charges
Rs.Crore
0.07 0.11 0.16 0.26 0.25 0.32
7 Interest on Working Capital Rs.Crore
14.67 17.84 16.43 17.83 19.58 19.15
8 Recovery of ARR & TariffPetition Fees
Rs.Crore
0.50 0.51 0.5 0.3 0.44 0.41
9 Return on Equity Rs.Crore
26.30 36.38 36.45 36.54 36.62 36.71
10 Provision for bad andDoubtful debt
Rs.Crore
16.501.97
11 Total Fixed Charge Rs.Crore
961.45 1201.7 1355.00 1512.87 1578.66 1619.87
12 Less: Non‐Tariff Income(Including GovernmentGrant)
Rs.Crore
10.85 34.84 33.03 29.00 26.46 24.14
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 41
13 Less: Receipt on account ofCross Subsidy Surcharge
Rs.Crore
14 Total Cost Rs.Crore
950.60 1166.86 1321.97 1483.87 1552.21 1595.73
# Fees for filing tariff Petition has been considered under A&G expense
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 42
6. Revenue from Operations for FY2016-17 to FY 2018-19
1. The detailed break-up of the actual revenue for various categories of consumers for FY 2015-16 to
FY 2018-19 has been provided below. The revenue for FY 2019-20 and FY 2020-21 has been
projected based on the average tariff of FY 2018-19 multiplied by total sales as per the Energy
Balance table.
Revenue at existing tariff
Table 1: Category wise revenue at existing tariff (Rs. Crores)
Category FY2015-16
2016-17 2017-18 2018-19 FY 2019-20(Projected)
FY 2020-21(Projected)
Domestic 242.94 248.58 250.33 255.99 273.61 279.66Commercial 41.53 42.49 44.53 41.97 44.86 44.30Irrigation 14.29 14.62 15.67 15.28 16.33 16.58Water Works 29.19 29.87 35.99 34.82 37.22 39.93Industries 27.15 27.78 29.20 26.26 28.07 27.12Mobile Towers 14.39 14.73 17.72 16.30 17.42 18.21Bulk Supply 30.53 31.24 34.81 32.72 34.97 35.56Tea, Coffee & Rubber Plants 1.70 1.74 0.61 0.20 0.21 0.07
Public Lighting 2.66 2.72 3.11 3.38 3.61 4.00Border flood lighting 0.33 0.34 0.26 0.11 0.11 0.06
Others 54.57 55.83 58.26 56.24 60.11 59.94Total 459.2
8469.94 490.46 483.25 516.51 525.43
2. The treatment of the revenue gap / (surplus) has been discussed subsequently in this Petition.
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 43
7. Tariff Design and Proposed RateSchedule
7.1. New Provisions in Tariff ScheduleTariff for Pre-Paid Meters
In order to reduce AT&C losses, TSECL is planning to promote deployment of pre-paid consumer
meters. This would help TSECL to improve its collection efficiency as well as reduce the working capital
requirements. The cost of pre-paid meters have also reduced over the last few years and the technology
has already been deployed in other placed in India. As such, TSECL plans to promote the
implementation of pre-paid meters are deploy pre-paid meters for new connections, replacement of
defective meters etc.
In order to promote use of pre-paid meters, TSECL proposes to provide consumers a rebate of 2% on
the total electricity bill amount. This shall incentivize the consumers for moving to pre-paid
meters and also would benefit the utility as the risk for non-collection would be mitigated and the
working capital requirement would reduce.
Under pre-paid meters, consumers are required to pay vend transaction charges for every transaction
or recharge done as service charges for the transaction. TSECL feels that levy of additional charges may
become a hindranceinsmooth implementation of pre-paid meters at this stage. As such, in order to
promote pre-paid meters, TSECL proposes that these vend transaction charges would also be borne by
TSECL and the consumers would get a total rebate of 2% on the total electricity bill amount as proposed
above. It is submitted that the expected vending transaction charge would be around Rs. 12 per
consumer per transaction, which shall be recovered through ARR in the initial period.
Online payment
In order to improve customer satisfaction and increase the avenues of easy payment for customers,
TSECL has already implanted the facility of online payment of electricity bill payment by the customers.
For conducting these transactions, certain charges have to be made to the payment service gateway. In
case of online payment, the customer is already incentivized as he can pay the electricity bill from
anywhere without having to come at the collection counter of TSECL. As such, in case of online
payment, TSECL is proposing that the transaction charges of the payment gateway should also be borne
by TSECL and the same shall be recovered through ARR.
Power Factor Rebate and Penalty
At present, all the consumer categories are charged based on the electricity consumption in kWh and as
such there is no incentive for improvement in power factor. Most of the other states in India have an
incentive-penalty provision in tariff for the big consumers like the industrial consumers to keep the
power factor within the acceptable limits and reduce the losses in the system. Based on the similar
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 44
provisions prevalent in other states, TSECL proposes to introduce the following power factor rebate and
penalty provision for HT/EHT Industrial Category consumers initially. The same shall be presently
applicable only for all industrial category consumers but may be extended for other categories in future.
(a) Power Factor Rebate:
I. In case, the average PF (leading or lagging) maintained by the consumer is more than 0.85 and
upto 0.95, a rebate of 1% on the Energy Charges on unit consumption shall be applicable;
II. For PF (leading or lagging) of 0.95 and above upto 0.97, a rebate of 2% on the Energy Charges
on unit consumption shall be applicable;
III. For PF (leading or lagging) of 0.97 and above upto Unity PF, a rebate of 3%on the Energy
Charges on unit consumption shall be applicable.
(b) Power Factor Penalty:
I. In case average PF (leading or lagging) in a month for a consumer fallsbelow 0.85, a penalty
@1% for every 1% fall in PF (leading or lagging) from0.85 to 0.60; plus 2% for every 1% fall
below 0.60 to 0.30 upto and including0.30 shall be levied on total unit consumption.
Limit for Single Phase/Three Phase Consumers
At present, the limit for connected load in single phase connections in LT categories of domestic and
commercial is 3 kW. As against this, most of the states in India have a limit of 5 kW for single phase
connections. The single phase meters available now are also capable of supporting load upto 5 kW.
With the increasing use of appliances like AC, geysers etc. it is felt that the limit for single phase
connections may be increased up to 5 kW to avoid unnecessary inconvenience to the consumers for
change of meters etc. As such, the Hon’ble Commission is requested to change the limit of connected
load in LT domestic and commercial consumers from 3 kW to 5 kW.
Separate Tariff Category for Electric Vehicles
As per the guidelines issues by Ministry of Power, a separate tariff category is proposed for
commercially operating electric vehicle charging stations (not for own use) at 5% discounted rate (in
fixed and energy charges) than the applicable rate for LT commercial or HT commercial as applicable
Notices to be provided to consumers on SMS/Whatsapp
There will be a provision for serving notices to consumers through digital medium like SMS, whatsapp,
email etc. The scope is intimation of billing information, Billing alerts informing total due amount, due
date, when services will be disconnected if not paid, notices for unpaid bills and notice for
disconnections.
Go Green Initiative
There will be a rebate of 10/- per electricity bill if consumer opts for receiving a digital copy of bill
instead of hard copy
MYT Petition for Transmission & Distribution Business of TSECL
Tripura State Electricity Corporation LimitedPwC 45
8. Revenue Gap for the control period
8.1. Revenue gap at existing tariffFor calculating the total regulatory asset, TSECL has considered the revenue gap at existing tariff.
Further the gap is calculated considering the revenue from retail and bulk sales and the total cost of
distribution business for the respective FY 2013-14 to FY 2020-21
The following table shows the gap at existing tariff.
Table 1: Revenue Gap at existing tariff for MYT Period
Revenue Gap and Regulatory Asset FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-
19
FY 2019-20
(Projected)
FY 2020-21(Projected)
Revenue at Existing Tariff Rs.Crore 459.28 469.94 490.46 483.25 516.21 525.43
Revenue Subsidy from StateGovt.
Rs.Crore 69.00 40.00 32.00 20.00 40.00 40.00
Revenue from Inter StateSales
Rs.Crore 301.07 504.13 742.48 816.83 841.34 866.58
Total Revenue Rs.Crore 829.35 1014.06 1264.95 1320.09 1397.85 1432.01
Revenue Gap at existing tariff Rs.Crore 121.25 152.79 57.02 163.78 154.35 163.72
Revenue at proposed Tariff Rs.Crore 0.00 469.94 490.46 483.25 516.51 525.43
Additional Revenue atproposed Tariff
Rs.Crore 0.00 0.00 0.00 0.00 0.00 0.00
Revenue gap at proposedtariff
Rs.Crore 121.25 152.79 57.02 163.78 154.35 163.72
Regulatory Asset carried overfrom previous year (FY 14-FY
14)
Rs.Crore 261.38 382.63 535.42 592.45 755.80 910.15
Rate of Carrying Cost (Sameas IoWC)
Rs.Crore 13.00% 12.30% 12.10% 11.70% 12.05% 11.45%
Carrying Cost on RegulatoryAsset
Rs.Crore 69.32 91.07 104.21
Total Regulatory Asset Rs.Crore 382.63 535.42 592.45 825.54 1001.22 1178.08
It can be observed from the above that the revenue at existing tariff would not be sufficient enough to
meet the annual revenue requirement of each of the years during control period. Besides, when the
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revenue gap carried over from previous years is considered, it becomes imperative that there is a need to
increase the existing tariff to make it sufficient enough to meet the requirement and recover the pending
gap of past years which has accumulated over the past few years. The Hon’ble Commission is also aware
that TSECL has signed the tripartite MoU under UDAY scheme which also requires a periodic tariff hike
for FY 2017-18 as well as for FY 2018-19. It has been calculated that an average tariff hike of around 30%
would result in annual increased revenue of around INR 157 crores and the proposed gap would be
recovered in around 7 years if average tariff hike of 30% is imposed. Since this is the first MYT control
period and the first baseline data has not been approved, TSECL has not proposed the exact tariff hike at
this stage since the quantum of approved gap over such a long period cannot be estimated at this stage.
In addition to this, the cost and revenue dynamics of TSECL is estimated to change drastically in future
depending on the future prospects of sale to Bangladesh. However, in order to give an idea of the tariff
hike that may be required, TSECL is showing the average time taken to recover the proposed gap in
different scenarios of tariff hike.
Particualrs Scenarios10% averagehike
20% averagehike
30% averagehike
Additional Revenue at ProposedTariff in FY 20-21 52.54 105.09 157.63Time Taken for BridgingRegulatory Gap years 22.42 11.21 7.47
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9. Open Access Charges
9.1. IntroductionIn this section, TSECL is proposing the open access charges, particularly the distribution wheeling
charge and cross subsidy surcharge, for the ensuing years based on the ARR proposed above for FY
2018-19.
9.2. Allocation MatrixThe Commission in MYT regulations 2015 has specified that the distribution licensee should segregate
the accounts of licensed business into wheeling business and retail supply business. Further, it provides
that in case accounts are not segregated as per provisions of these Regulations, the distribution licensee,
shall prepare an allocation statement to apportion costs and revenue to respective businesses. The
relevant clause is given below:
“Provided that the commission reserves the right to determine Wheeling Charges of theDistribution Licensee on the basis of segregated accounts the Licensed business intoDistribution Wires Business and Retail Supply Business.
Provided further that where the Distribution Licensee is not able to submit audited andcertified separate accounts for Distribution Wires Business and Retail Supply Business, theCommission shall determine allocation matrix in the following manner:
• The Licensee shall prepare an “allocation matrix” for the control period showingapportionment of costs and revenues to Distribution Wires Business and Retail SupplyBusiness. The statement shall be supported with an explanation of the methodology usedfor such allocations. The Allocation Statement should be consistent over the ControlPeriod, as approved by the Managing Director/CEO of the Licensee.
• The Commission shall review the “allocation matrix” submitted by the Licensee and basedon the prudence check shall finalize the “allocation matrix” for each year of the controlperiod.”
However, TSECL at present, has not segregated its accounts and as such, it is proposing an allocation
matrix for segregation of costs in respective business.
Table 1: Allocation matrix for separation of ARR for Wires Business and Retail Supply Business
Sl.No. Particulars WireBusiness
Retail SupplyBusiness
1 Power purchase expenses 0% 100%
2 Transmission Charge 0% 100%
3 Employee expenses 60% 40%
4 Repair and Maintenance expenses 90% 10%
5 Administration and General expenses 50% 50%
6 Depreciation 90% 10%
7 Interest and Finance charges 90% 10%
8 Interest on working capital 10% 90%
9 Interest on Security deposit 0% 100%
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Sl.No. Particulars WireBusiness
Retail SupplyBusiness
10 Bad debts written off 0% 100%
11 Income tax 90% 10%
12 Return on equity 90% 10%
13 Other income 10% 90%
14 Non-tariff income 0% 100%
15 Revenue subsidy 0% 100%
Based on the above allocation matrix, the total ARR for wheeling business is provided below:
Table 2: Separation of ARR for Wires Business and Retail Supply Business
All figures are in Rs. Crore
Sl.No. Particulars
FY 2018-19
WireBusiness
Retail SupplyBusiness
1 Power purchase expenses 0.00 914.18
2 Transmission Charge 0.00 52.63
3 Employee expenses 20.14 13.42
4 Repair and Maintenanceexpenses 247.49 27.50
5 Administration and Generalexpenses 88.26 88.26
6 Depreciation 5.33 0.59
7 Interest and Finance charges 0.23 0.03
8 Interest on working capital 1.78 16.05
9 Interest on Security deposit
10 Bad debts written off 0.00 0.00
11 Income tax
12 Return on equity 32.88 3.65
13 Other income
14 Non-tariff income 0.00 29.00
15 Revenue subsidy
Total 396.13 1087.32
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9.3. Wheeling ChargesThe wheeling charges for distribution open access consumers and 33 kV voltage level for FY 2018-19,
has been determined from the ARR of the Wires Business distribution, as determined in table above.
Table 3: Wheeling Charge for 33 kV voltage level
Sl. No. Particulars Unit FY 2018-19
1 Total energy input into Distributionsystem
MU 1263.74
2 Total distribution cost Rs. Crore 396.13
3 Distribution cost for wires businessfor 33 kV voltage level (assuming 35%
of cost at 33 kV)
Rs. Crore 138.64
4 Wheeling charges for 33 kV voltagelevel
Rs./kWh 1.10
The wheeling charges for FY 2018-19 as determined above, are applicable for use of the distribution
system of TSECL by other licensees or generating companies or captive power plants or
consumers/users who are permitted open access at 33 kV voltage level under Section 42(2) of the
Electricity Act, 2003.
9.4. Cross Subsidy SurchargeThe open access consumers are liable to pay the cross subsidy surcharge to compensate the utility for
any loss of revenue due to the shifting of the consumer to the open access system. In accordance with
Tripura Electricity Regulatory Commission(Terms and Condition of Open Access) Regulation, 2010,
consumers with a connected load of 1 MW and above shall be allowed open access.
For determination of cross subsidy, TSECL would like to propose the following voltage wise cost of
supply which has been calculated based on the methodology specified by Hon’ble APTEL in Appeal No.
102 of 2010 and other related appeals in this matter. Based on the methodology specified by Hon’ble
APTEL, the voltage wise cost of supply is provided below:
Table 4: Calculation of Cost of Supply
Particulars SymbolFY 2018-19
LT 11 kV 33 kV Above33 kV
T&D losses (%) L 35.42% 11.54% 7.03% 6.00%Average Power Purchase rate(Rs./kWh) A 3.60 3.60 3.60 3.60
Average Power Purchase Cost Per UnitSold (Rs./kWh) B=A/(1-L)
5.58 4.07 3.88 3.83
Other Cost Per Unit Sold (Rs./kWh) C=OtherCost/Units sold
2.10 2.10 2.10 2.10
Total Voltage Wise Cost of Supply((Rs./kWh) D=B+C 7.68 6.18 5.98 5.94
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Accordingly, the cross subsidy surcharge for HT industry category for FY 2018-19, is shown in the Table
below:
Table 5: Calculation of Cross Subsidy Surcharge
Sl.No.
Particulars Unit Industrial(11 kV)
Industrial(33 kV)
BulkSupply
Tea, Coffee& Rubber
1 Average Billing Rate asper proposed tariff
Rs./kWh 9.64 10.07 .8.46 8.96
2 Voltage Wise Cost ofSupply
Rs./kWh 6.18 5.98 6.18 6.18
3 Cross subsidysurcharge as Differenceof Actual Cost andTariff
Rs/kWh 3.46 4.09 2.28 2.78
4 20% of Average Cost ofSupply
Rs/kWh 1.54 1.54 1.54 1.54
5 Cross SubsidyCharges Proposed(Minimum of Sr.No.3 and 4)
Rs/kWh 1.54 1.54 1.54 1.54