tamil nadu electricity regulatory … adjustment...before the hon’ble tamil nadu electricity...

BEFORE THE HON’BLE

TAMIL NADU ELECTRICITY REGULATORY COMMISSION,

CHENNAI

FILING OF THE PETITION FOR ADJUSTMENT OF TARIFF FOR FY 2017-

18

UNDER TNERC (TERMS AND CONDITIONS FORDETERMINATION OF TARIFF)

REGULATIONS, 2005 AND TNERC (MULTI YEAR TARIFF FRAMEWORK)

REGULATIONS, 2009 AMENDED FROM TIME TO TIME

&

UNDER PART VII (SECTION 61 TO SECTION 64) OF THE ELECTRICITY ACT, 2003

READ WITH THE RELEVANT GUIDELINES

FILED BY TAMILNADU GENERATION AND DISTRIBUTION CORPORATION

LIMITED (TANGEDCO) CHENNAI

Petition for Adjustment of Tariff for FY 2017-18

Table of Contents

1. OVERVIEW OF TANGEDCO ....................................................................................................................... 8

1.1 PREAMBLE ................................................................................................................................................ 8

1.2 BACKGROUND ........................................................................................................................................... 8

1.3 OPERATIONAL PERFORMANCE OF TANGEDCO ............................................................................................. 10

2. OVERALL APPROACH FOR PRESENT FILING ............................................................................................ 11

2.1 PRESENT APPROACH................................................................................................................................. 11

2.2 REGULATORY FRAMEWORK ........................................................................................................................ 11

3. ANNUAL REVENUE REQUIREMENT FOR FY 2017-18 AND ADJUSTMENT OF TARIFF FOR FY 2017-18 ...... 12

3.1 PREAMBLE .............................................................................................................................................. 12

3.2 ANNUAL REVENUE REQUIREMENT FOR FY 2017-18 ....................................................................................... 12

3.3 UJWAL DISCOM ASSURANCE YOJANA (UDAY) .................................................................................... 12

3.4 IMPACT OF FINAL TRANSFER SCHEME – REVALUATION RESERVE......................................................................... 15

3.5 REVENUE GAP FOR FY 2017-18 AT EXISTING TARIFF ...................................................................................... 18

3.6 EXISTING AND PROPOSED RETAIL TARIFF SCHEDULE FOR FY 2017-18 ................................................................ 18

3.7 REVENUE FROM SALE OF POWER ................................................................................................................. 20

3.8 REVENUE GAP AT PROPOSED TARIFF ............................................................................................................ 21

4. FORMATION OF REGULATORY ASSETS .................................................................................................. 22

4.1 REGULATORY ASSET ................................................................................................................................. 22

4.2 RECOVERY OF REGULATORY ASSET .............................................................................................................. 23

4.3 REVISION IN REGULATORY ASSETS ............................................................................................................... 24

5. WHEELING CHARGES ............................................................................................................................. 26

5.1 BACKGROUND ......................................................................................................................................... 26

5.2 SUMMARY OF EXPENSES CONSIDERED FOR WHEELING CHARGES....................................................................... 26

5.3 ADDITIONAL SURCHARGE .......................................................................................................................... 27

5.4 GRID AVAILABILITY CHARGES ..................................................................................................................... 27

6. TARIFF PHILOSOPHY .............................................................................................................................. 29

6.1 INTRODUCTION ....................................................................................................................................... 29

7. TARIFF SCHEDULE .................................................................................................................................. 35

TARIFF FOR HIGH TENSION SUPPLY CONSUMERS .......................................................................................... 35

7.1 GENERAL PROVISIONS APPLICABLE FOR HIGH TENSION SUPPLY ......................................................................... 35

7.2 HIGH TENSION TARIFF I A: ........................................................................................................................ 36

7.3 HIGH TENSION TARIFF I B: ........................................................................................................................ 38

7.4 HIGH TENSION TARIFF II A: ....................................................................................................................... 38

7.5 HIGH TENSION TARIFF II B: ....................................................................................................................... 39

7.6 HIGH TENSION TARIFF III: ......................................................................................................................... 39

7.7 HIGH TENSION TARIFF IV:......................................................................................................................... 39

7.8 HIGH TENSION TARIFF V ........................................................................................................................... 40


TARIFF FOR LOW TENSION SUPPLY CONSUMERS ........................................................................................... 40

7.9 GENERAL PROVISIONS APPLICABLE FOR LOW TENSION SUPPLY .......................................................................... 40

7.10 LOW TENSION TARIFF I A: ......................................................................................................................... 41

7.11 LOW TENSION TARIFF I B: ......................................................................................................................... 43

7.12 LOW TENSION TARIFF I C: ......................................................................................................................... 44

7.13 LOW TENSION TARIFF II A: ........................................................................................................................ 44

7.14 LOW TENSION TARIFF II B (1): ................................................................................................................... 45

7.15 LOW TENSION TARIFF II B (2): ................................................................................................................... 45

7.16 LOW TENSION TARIFF II C: ........................................................................................................................ 46

7.17 LOW TENSION TARIFF III A (1): .................................................................................................................. 46

7.18 LOW TENSION TARIFF III A (2): .................................................................................................................. 48

7.19 LOW TENSION TARIFF III B: ....................................................................................................................... 48

7.20 LOW TENSION TARIFF IV: .......................................................................................................................... 50

7.21 LOW TENSION TARIFF V: ........................................................................................................................... 51

7.22 LOW TENSION TARIFF VI: .......................................................................................................................... 51

7.23 APPLICABILITY OF THE TARIFF SCHEDULE ...................................................................................................... 53

8. COMPLIANCE OF DIRECTIVES ................................................................................................................. 54

8.1 PREAMBLE .............................................................................................................................................. 54

9. PRAYERS ................................................................................................................................................ 58


List of Tables

Table 1: ARR for FY 2017-18 (Rs. Crores) .............................................................................................. 12

Table 2: Savings due to participation in UDAY ...................................................................................... 14

Table 3: Adjusted revaluation reserves ................................................................................................ 17

Table 4: Allocation of Revaluation Reserves of Depreciable Assets (Rs Crores)................................... 17

Table 5: Revenue gap at existing tariff for FY 2017-18 (Rs. Crores) ..................................................... 18

Table 6: Existing and Proposed retail tariff schedule FY 2017-18 ......................................................... 19

Table 7: Revenue from sale of power at existing and proposed tariff for FY 2017-18 ......................... 21

Table 8: Revenue gap at proposed tariff for FY 2017-18 (Rs. Crores) .................................................. 21

Table 9: Regulatory asset approved in last Tariff Order ....................................................................... 24

Table 10: Regulatory asset proposed in this Petition ........................................................................... 24

Table 11: Annual Distribution Charges for FY 2017-18 ......................................................................... 26

Table 12: Allocation of Wheeling Charges into LT and HT Category .................................................... 27

Table 13: Wheeling Charges per Unit ................................................................................................... 27


List of Abbreviations Sr. No Abbreviations Descriptions

1. A&G Administrative and General

2. AS Aggregate Revenue Requirement

3. AT&C Aggregate Technical and Commercial loss

4. CAPEX Capital Expenditure

5. CERC Central Electricity Regulatory Commission

6. CPPs Captive Power Plants

7. Crs Crores

8. Discom Distribution Companies

9. EA Electricity Act, 2003

10. FY Financial Year

11. GFA Gross Fixed Assets

12. G.O. Government Order

13. GoTN Government of Tamil Nadu

14. HT High Tension

15. IPP Independent Power Producers

16. KV Kilo Volt

17. kVA Kilo Volt Ampere

18. FY Financial Year

19. GFA Gross Fixed Assets

20. G.O. Government Order

21. GoTN Government of Tamil Nadu

22. HT High Tension

23. IPP Independent Power Producers

24. IPDS Integrated Power Development Scheme

25. KV Kilo Volt

26. kVA Kilo Volt Ampere

27. kVAh Kilo Volt Ampere Hour

28. kW Kilo Watt

29. kWh Kilo Watt Hour

30. LT Low Tension

31. MOD Merit Order Despatch

32. kVAh Kilo Volt Ampere Hour

33. kW Kilo Watt

34. kWh Kilo Watt Hour

35. LT Low Tension

36. MOU Memorandum of Understanding

37. MU Million Units (Million kWh)

38. MVA Mega Volt Ampere


Sr. No Abbreviations Descriptions

39. MW Mega Watt

40. MYT Multi Year Tariff

41. NTP National Tariff Policy

42. O&M Operation & Maintenance

43. PAF Plant Availability Factor

44. PFC Power finance Corporation

45. PLF Plant Load Factor

46. R&M Repair and Maintenance

47. ROE Return on Equity

48. RPO Renewable Purchase Obligation

49. Rs Rupees

50. SBI State Bank of India

51. SHR Station Heat Rate

52. T&D Transmission and Distribution

53. TNEB Tamil Nadu Electricity Board

54. TANGEDCO Tamil Nadu Generation and Distribution Corporation Limited

55. TANTRANSCO Tamil Nadu Transmission Corporation Limited

56. TNERC Tamil Nadu Electricity Regulatory Commission

57. UDAY UjwalDiscom Assurance Yojana


BEFORE THE TAMIL NADU ELECTRICITY REGULATORY COMMISSION

CHENNAI

Filing No:

Case No:

IN THE MATTER OF Filing of Petition for Tariff Adjustment to bring down the subsidy

burden of the State Government without changing the tariff burden

on the consumers for the financial year 2017-18 under TNERC

(Terms and conditions for Determination of Tariff) Regulations, 2005

and of MYT under TNERC (Multi Year Tariff Framework) Regulations,

2009 amended from time to time along with other guidelines and

directions issued by the TNERC and under Part VII (Section 61 to

Section 64) of the Electricity Act, 2003 read with the relevant

Guidelines.

AND

IN THE MATTER OF Tamil Nadu Generation and Distribution Corporation Limited,

N.P.K.R.R Maligai,

144, Anna Salai,

Chennai 600 002 ..…PETITIONER

THE APPLICANT NAMED ABOVE RESPECTFULLY SHOWETH UNDER


1. OVERVIEW OF TANGEDCO

1.1 Preamble

1.1.1 This section presents the background and reasons for filing of this Petition.

1.2 Background

1.2.1 Tamil Nadu Electricity Board (TNEB) came into existence on 1stJuly 1957 under the repealed

Act of Electricity (Supply) Act 1948 and has been in the business of generation, transmission

and distribution of electricity in the state of Tamil Nadu.

1.2.2 Over the last few decades, there has been significant interest in opening the Electricity

sector to competition and, by extension, interest in designing electricity markets to push the

sector toward more efficient outcomes. Accordingly, the Electricity Act, 2003 (“the Act” or

“EA 2003”) was enacted with effect from 10th June, 2003 which requires the State

Governments to initiate major changes in the Industry Structure and Operations of the state

power sector. The objective of the enactment was to make competition feasible or desirable

in a sector that has been vertically integrated and highly regulated or state owned.

1.2.3 In line with the Electricity Act 2003, Sections 131 to 134 mandates reorganisation of the

State Electricity Boards into functional entities and corporatisation of the same. Regardless

of the design of the electricity sector reforms, the ultimate goal of reforms is to make the

sector more efficient. Therefore, in order to meet the requirements under the Act and to

become more efficient and competitive, the Government of Tamil Nadu (GoTN) and the

Tamil Nadu Electricity Board (TNEB) proposed to restructure the state power sector.

1.2.4 In accordance with the above mandate the Government of Tamil Nadu (GoTN) had given in-

principle approval for the re-organization of TNEB by establishing a holding company, named

TNEB Ltd and two subsidiary companies, namely Tamil Nadu Transmission Corporation

Limited (TANTRANSCO) and Tamil Nadu Generation and Distribution Corporation Limited

(TANGEDCO) vide G.O.Ms.No.114 Energy (B2) Department dated 8th October 2008 with the

stipulation that the aforementionedcompanies shall be fully owned by Government.

1.2.5 Based on the approval of Memorandum of Association and Articles of Association of

TANGEDCO and TNEB Limited by the Government of Tamil Nadu vide G.O.Ms.No.94 Energy

(B2) Department dated 16th Nov 2009, Tamil Nadu Generation and Distribution Corporation

Limited (TANGEDCO) and TNEB Limited was incorporated on 1st Dec 2009 with an authorized

share capital of Rs.5.00 Crores and paid up capital of Rs.5.00 Lakhs each for TANGEDCO

andTNEB Limited. The Certificates of commencement of business have been obtained for

the TANGEDCO on 16th Mar 2010 and for TNEB Ltd on 12th Mar 2010 respectively.

1.2.6 The proposal for Assets Transfer and Employee transfer called as Tamil Nadu Electricity


Board (Reorganization and Reforms) Transfer Scheme 2010 has been notified by

Government of Tamil Nadu vide G.O. (Ms).No.100 Energy (B2) Department dated 19th Oct

2010 with the effective date of implementation as 1st Nov 2010. Based on the above

notification TNEB has been re-organized from 1st Nov 2010.

1.2.7 As per the Transfer Scheme the Provisional period for transfer of Assets is 1 year and for

transfer of employees is 3 years. From 1st Nov 2010 onwards all the employees ofthe

erstwhile TNEB shall stand transferred to and absorbed in TANGEDCO on a provisional basis

and assigned to the services of the relevant transferee.

1.2.8 Subsequently, as per the request of TNEB Limited, the second provisional transfer scheme

was notified by the State Government vide G.O. (Ms.) No.2, Energy (B2) department, dated

2ndJanuary 2012 with amendment in the restructuring of Balance Sheet of TNEB for the

successor entities i.e. TANGEDCO and TANTRANSCO, considering the audited balance sheet

of TNEB for FY 2009-10 and it had extended the provisional time for final transfer of assets

and liabilities to the successor entities of erstwhile TNEB up to 31st Oct 2012.

1.2.9 Subsequently, the audited balance sheet as on 31.10.2010 was ready and as a result thefinal

transfer scheme was notified by the Government of Tamilnadu vide G.O.Ms No.49, Energy

(B1) department, dated 13th August 2015, which is the final amendment to the earlier

transfer scheme (G.O. (Ms).No.100 Energy (B2) Department dated 19th Oct 2010 and G.O.

(Ms.) No.2, Energy (B2) department, dated 2nd January 2012) which gave effect to the

transfer of assets and liabilities to successor entities of erstwhile TNEB as on 01.11.2010

1.2.10 Post restructuring, TANGEDCO as per the notification was provided with the functions of

generation and distribution of electricity in the State of Tamil Nadu.

1.2.11 The enactment of the Electricity Act, 2003 has opened up the power sector for competition

in all spheres of activities. TANGEDCO as the State Generation and Distribution Utility is

entrusted with the duty of generating power and distribution of the same to the end

consumers through its generating stations and vast distribution network.

1.2.12 Starting with a modest installed capacity of 156 MW on 1st July 1957, the Board’s own

generating capacity in its command has grown to 27,625.45 MW as on 1stApril

2016.TANGEDCO has an even mix of the various generating capacities such as 4,660 MW of

coal based thermal stations, 516 MW ofGas Turbine Stations and 2,308MW of Hydro

Stations. In addition, there is an infirm power of 17 MW from Wind Farms. Besides, the

Board has a share of 5,464MW from Central Generating Stations, 9,649MW of non-

conventional energy sources (including wind, solar), 987 MW from CPP and 4,042 MW from

long term and medium term open access (LTOA & MTOA) and IPPs. The present demand of

power in the State is ~14,500 - 15,000 MWand reached an all-time high of 15,343MWand


high energy consumption of 345.617 MUs on 29thApril 2016.

1.3 Operational performance of TANGEDCO

1.3.1 The State has been maintaining almost 24 hours of power supply to all categories of

consumers including agriculture sector. The R&C measures have been completely withdrawn

from June, 2016. The State of Tamil Nadu does not have its own coal resource and has to

source its requirements partly from the Eastern Coal Fields Ltd. (ECL) and Mahanadi Coal

Fields Ltd. (MCL) mines situated in West Bengal and Orissa respectively &during February

last year Chandrabila coal block was allotted to TANGEDCO for ETPS Expansion project,

Ennore SEZ project Udangudi Stage I. TANGEDCO at its end is also trying to tap other power

sources vizhydel potential has been tapped to its fullest potential. Tamil Nadu has a friendly

policy for encouraging non-conventional sources of power such as wind, solar, co-generation

etc. Tamil Nadu has the largest wind power capacity of about 7,617 MW and solar capacity

of 1143.41 MWas on 30thJune 2016. However, besides being infirm in nature, the power

from wind sources is available mostly during June to September. Apart from this, the State

has four independent Power Producers (IPP) plants in operation at present.

1.3.2 TANGECO is making continuous efforts to add generation capacity, in spite of constraints on

its financial resources. The increasein power demand is being met by power purchase from

central generating stations such as NLC and joint venture project at Vallur and Tuticorin

implemented along with NTPC and NLC respectively and also the increase in non-

conventional source of power.

1.3.3 Similarly on the own generation end, TANGEDCO had made an addition of 600 MW of

capacity through Mettur Generating Station Stage III during FY 2013-14 and the North

Chennai Thermal Power Station Stage II with an additional capacity of 1200 MW during FY

2014-15.

1.3.4 The distribution network of TANGEDCO comprises of 66kV, 33kV, 22kV and 11kV sub-

transmission system. TANGEDCO owns and operates an extensive distribution network

consisting of 7.81 Lakhs Ckt. Kms of lines, of which 1.70 Lakhs Ckt.Kms of HT Line Network

and 6.11 Lakhs Ckt. Kms of LT line Network as on 31stMarch 2016. It also owns and operates

majority of the generation assets in the state and is buyer of power from the Government of

India owned (Central) generating stations and private producers in the state. It also owns

1,395 substations and 2,67,421 distribution transformers with a total capacity of 30,920

MVA as on 30th June 2016. TANGEDCO is also making continuous efforts towards

strengthening the distribution networks to reduce the AT&C losses in the system to a target

level of below 15% by FY 2018-19 through implementation of the following schemes.

a) Re-structured Accelerated Power Development and Reforms Programme (R-APDRP)

b) Integrated Power Development Scheme (IPDS),

c) DeendayalUpadhyaya Gram Jyoti Yojana (DDUGJY)


2. OVERALL APPROACH FOR PRESENT FILING

2.1 Present Approach

2.1.1 The Hon’ble Commission on 03rd August 2005 notified the TNERC (Terms and Conditions for

Determination of Tariff) Regulations, 2005.In the said Regulation, the Commission specified

that the licensee has tofile the Aggregate Revenue Requirement (ARR) for each year in the

format prescribed, containing the details of the expected aggregate revenue that the

licensee is permitted to recover at the prevailing tariff and the estimated expenditure.

In line with the same, TANGEDCO has filed its petition on 27th January, 2017 for

determination of ARR for consideration of the Hon’ble Commission in the formats laid down

for providing information relating to past, current and future performance. Now TANGEDCO

is filing this petition for adjustment of tariff for FY 2017-18.

2.1.2 As per the Amendment to Tamil Nadu Electricity Regulatory Commission Terms and

conditions for determination of tariff for intra state transmission / Distribution of Electricity

under MYT framework Regulations 2009 dated 28th November 2012, the control period is

defined as:

“(i) Control Period: The control period under the MYT framework shall be for duration of 3

years. The year preceding the first year of the control period shall be the base year.”

2.1.3 Based on the above amendment, the control period for TANGEDCO will be from FY 2013-14

to FY 2015-16 and then from FY 2016-17 to FY 2018-19.

2.1.4 In accordance with section 62 of the Electricity Act 2003 and Regulation 5 of the TNERC

(Terms and Conditions for Determination of Tariff) Regulations, 2005, TANGEDCO is now

filing this present petition for adjustment of tariff for FY 2017-18.

2.2 Regulatory Framework

2.2.1 TANGEDCO has considered the norms as specified by TNERC Tariff Regulations 2005, TNERC

MYT Regulations, 2009 and its subsequent amendment. However certain deviation has been

considered with a justification for the purpose of this petition and it is requestedto approve

the same.


3. ANNUAL REVENUE REQUIREMENT FOR FY 2017-18 AND ADJUSTMENT OF TARIFF

FOR FY 2017-18

3.1 Preamble

3.1.1 This section outlines the annual revenue requirement and the adjustment of tariff for FY

2017-18.

3.2 Annual revenue requirement for FY 2017-18

3.2.1 As per the petition filed by TANGEDCO on 27th January, 2017 for true up of FY 2011-12 to FY

2015-16 and determination of ARR for FY 2017-18 to FY 2018-19, the ARR for FY 2017-18 is

furnished below.

Table 1: ARR for FY 2017-18 (Rs. Crores)

3.3 UJWAL DISCOM ASSURANCE YOJANA (UDAY)

3.3.1 UDAY Scheme has been introduced by Ministry of Power, Government of India on 20th

November, 2015 for financial and operational turnaround of DISCOMs which was applicable

only to State Owned DISCOMs. The intent of this scheme was to find a permanent solution

to the financial mess of DISCOMs. UDAY assures the rise of vibrant and efficient DISCOMs

through a permanent resolution of past as well as potential future issues of the sector. It

empowers DISCOMs with the opportunity to break even in the next 2-3 years.

3.3.2 The scheme comprises four initiatives - improving operational efficiencies of discoms,

reduction of cost of power, reduction in interest cost of discoms and enforcing financial

discipline on discoms through alignment with state finances. It allows state governments,

which own the discoms, to take over 75 percent of their debt as of 30th September, 2015,

and pay back lenders by selling bonds. Discoms are expected to issue bonds for the

remaining 25 percent of their debt. It also specifies an action plan for completion of certain

FY 2017-18

Projected

1 Expenses with respect to Generation (Variable Cost) 9,060.77

2 Expenses with respect to Generation (Fixed Cost) 6,773.89

3 Power Purchase Cost from Other Sources 25,890.14

4 Transmission Charges paid to TANTRANSCO 1,870.82

5 Net Operation & Maintenance Expenses 5,534.33

6 Depreciation 483.53

7 Interest & Finance Charges 3,345.74

8 Interest on Working Capital 235.23

9 Other Debits and Extra Ordinary Items 13.19

10 Return on Equity 609.62

11 Total Expenditure 53,817.27

12 Less: Non Tariff Income 952.65

13 Less: Other Income 586.89

14 Net Aggregate Revenue Requirement 52,277.74

S. No. Particulars


activities within the said timelines which will assist DISCOM to achieve the operational and

financial efficiencies.

3.3.3 The cut-off date for the participation in UDAY was 31stMarch 2016 which was extended to

31stMarch 2017 by MoP vide Office Memorandum dated 8thJuly 2016.

3.3.4 Operational efficiency improvements like compulsory smart metering, upgradation of

transformers, meters etc., energy efficiency measures like efficient LED bulbs, agricultural

pumps, fans & air-conditioners etc. will reduce the average AT&C loss from around 22% to

15% and eliminate the gap between Average Revenue Realized (ARR) & Average Cost of

Supply (ACS) by FY 2018-19 by way of regular ARR petition to be filed to SERC.

3.3.5 Tamil Nadu Power Sector was also ailing due to huge amount of debt and therefore decided

to participate in UDAY scheme and signed Tripartite MoU on 9thJanuary 2017. This will result

into a sustainable solution which is a win-win situation for State Power Sector as well as the

end consumers. UDAY is a path breaking reform for affordable and accessible 24x7 Power

for All. This will result into series of historic improvements across the entire value chain,

from fuel supply, to generation, transmission and consumption.

3.3.6 The salient features of the MoU signed by TANGEDCO are as follows:

Total debt proposed to be covered under UDAY scheme as on 30th September 2015 are

Rs. 30,420 Crores against which 75% of the debt i.e. Rs. 22,815 Crores will be taken over

by the State government and will be converted into 15 year bond with 5 year

moratorium. Balance 25% debt i.e. Rs. 7605 Crores will be converted into bond by

TANGEDCO backed by State Government guarantee.

Also, State Government will convert the TN Govt loan of Rs.3352Crores into Equity share

capital and Rs.2871 Crores will continue as interest free Government Loan.

The 75% debt of Rs. 22,815 Crorestakenover by State Government will be transferred to

TANGEDCO in the forms of grant at Rs. 4563 Crores each for five years.

TANGEDCO will endeavour to reduce AT&C losses to 13.50% by FY 2018-19.

The gap between ACS and ARR will be eliminated by FY 2018-19.

3.3.7 The action plan with timeline to achieve operational efficiency has been agreed under MoU.

Some of the illustrative list are outlined as under:

Achieving 100% Distribution Transformer (DT) Metering by 30thJune, 2018.

Achieving 100% feeder metering by 30thJune, 2017

Undertaking energy audit up-to 11 KV level in rural areas by 31stMarch, 2019.

Undertaking Feeder Improvement Program for network strengthening and optimization,

to be completed by December, 2018


Undertaking Physical Feeder Segregation by December, 2019

Installation of Smart Meters consuming above 500 units/month by 31stDecember, 2018

and above 200 units/ month by 31stDecember, 2019

Implementing ERP system for better and effective inventory management, personnel

management, accounts management etc. to reduce costs and increase efficiencies by

March, 2019.

Implementing Consumer Indexing and GIS mapping of Losses.

Replacing at least 10% of existing agriculture pumps with energy efficient pumps by

March, 2019.

3.3.8 The participation in UDAY was with the concept of providing the competitive, quality power

to consumers whereby the cost advantage will be passed on to consumers each year by way

of reduction in cost. The expected benefit from UDAY is as follows:

Due to reduction in interest rate as well as takeover of loan by State Government,

savings on interest expected ~Rs.2882 Crores p.a. Besides, there will be savings of

Rs.2282 Crores per annum to TANGEDCO in cash flow due to repayment of principal on

takeover loans by the Government.

When remaining 25% loans of Rs. 7605 Crores repaid through Bonds, interest savings

expected to be ~Rs.200 Crores besides staggered repayment of such loans.

Thus, estimated overall gain of ~Rs.3125Crores by way of reduction in interest burden

per annum besides and cash saving of ~Rs. 2282 Crores per annum on principal

repayment over 10 year period from sixth year onwards is expected.

Over and above the saving under the financial leverage, there will be also an additional

saving due to reduction in AT&C losses.

Overall savings due to participation in UDAY is broadly classified into two parts i.e.

reduction in revenue expenditure and cash saving.

Table 2:Savings due to participation in UDAY

3.3.9 As specified from the above table, the savings of Rs. 3,514 Crores in interest cost will result

in saving of 42 paise per unit in the cost which will be passed on to consumers. Also, the

reduction of Rs. 2,282 Crores will provide certain relief in working capital requirement

resulting in lower dependence on the short term working capital loan. This will also result in

Particulars Amount Particulars Amount

Interest savings due to takeover of

Rs.22815 crores.Rs. 2882

Cash flow savings on annual

Principal repayment Rs. 2282

Interest savings by converting

Rs.7605 crores into bondRs. 200

Interest saving due to conversion

of State loan of Rs.3352 crores as

equity

Rs. 432

Total Rs. 3514 Total Rs. 2282

Saving in Revenue Expenditure (Rs. Crs) Cash saving (Rs. Crs)


certain saving in interest cost.

3.3.10 The loan of Rs.22,815Crores taken over by the Government of Tamil Nadu (GoTN) will be

converted into grant to TANGEDCO over a period of five year, which will result in an

additional revenue expenditure burden of Rs.4,563Crores per annum. The above loan

takeover will also result in additional interest burden of Rs.1,825 Crores per annum to the

State Government.

3.3.11 From sixth year onwards, the State Government has to bear the interest burden of Rs. 1,825

Crores on revenue account and Rs. 2,282 Crores on capital account for loan repayment.

Thus, the State Government will be bearing the additional financial burden of Rs. 6,388

Crores per year for the first five years and Rs.4,107Crores from sixth year onwards till the

repayment of bonds. For the FY 2016-17, the fiscal deficit will be breached because of the

loan takeover of Rs. 22,815 Crores, however the Central Government has given relaxation

for Fiscal Deficit for FY 2016-17.

3.3.12 For the subsequent years, the additional expenditure burden on the State Government will

reduce its net available funds out of total borrowings to carry out the normal developmental

works, if the State Government has to maintain Fiscal Deficit of 3% of the GSDP. Therefore,

the fiscal space up to Rs. 2,500 Crores has to be created for the State Government in order

to absorb this debt takeover without breaching Fiscal Deficit norms.

3.3.13 Accordingly, TANGEDCO has proposed to adjust the tariff for domestic consumers in order to

bring down the subsidy burden of the State Government to an extent of Rs.2,503.27Crores.

This amount of Rs. 2,503.27 Crores will be absorbed by the TANGEDCO as it is likely to save

Rs. 3,082 Crores by way of interest reset and debt takeover by the State Government,

thereby TANGEDCO neither services the interest nor repays the taken over portion of the

debt of Rs. 22,815 Crores by the State Government.

3.4 Impact of final transfer scheme – Revaluation Reserve

3.4.1 Electricity Act 2003 seeks to provide a much-needed impetus to power sector reforms in the

country by incorporating provisions that would result in a much more competitive power

sector. Sections 131 to 134 of the Act 2003 mandates restructuring of the State Electricity

Boards into functional entities and corporatisation of the same. Accordingly, erstwhile TNEB

has been segregated into a holding company, by the name TNEB Ltd and two subsidiary

companies, namely Tamil Nadu Generation and Distribution Corporation Ltd (TANGEDCO)

and Tamil Nadu Transmission Corporation Ltd (TANTRANSCO).

3.4.2 The provisional proposal for Assets Transfer and Employee transfer called as Tamil Nadu

Electricity Board (Reorganization and Reforms) Transfer Scheme 2010 has been notified by


Government of Tamil Nadu vide G.O. (Ms).No.100 Energy (B2) Department dated 19th

October 2010 with the effective date of implementation as 1st November 2010.

3.4.3 Subsequently, the audited balance sheet as on 31.10.2010 was ready and as a result final

transfer scheme was notified by the Government of Tamilnadu vide G.O.Ms No.49, Energy

(B1) department, dated 13th August 2015, which is the final amendment to the earlier

transfer scheme (G.O. (Ms).No.100 Energy (B2) Department dated 19th Oct 2010 and G.O.

(Ms.) No.2, Energy (B2) department, dated 2nd January 2012) which gave effect to the

transfer of assets and liabilities to successor entities of erstwhile TNEB as on 01.11.2010.

3.4.4 The foremost objective of the reform program is to make the utilities financially viable.

There was a need to chart a course for gradual transformation of the sector from the

financially stressed position to financial self-sustainability to carry out their operations in

and effective manner. It is therefore necessary that they commence their operations with a

sound financial footing, which can be achieved through the transfer scheme and other

financial restructuring measures.

3.4.5 As per the Balance Sheet of erstwhile TNEB as on 31stOctober 2010 (i.e. date of Transfer

Scheme), the accumulated loss is around Rs. 34,741 Crores which was recommended to

write off by way of Revaluation of assets so that the successor entities will have a sound

balance sheet which is also an objective of the Electricity Act 2003. The revaluation of the

assets i.e. depreciable as well as non-depreciable assets was considered on following

principle:

The assets are revalued based on report given by chartered engineer and government

registered valuer.

Land is revalued based on soil, shape of land, its surrounding area after considering the

rate prevailing as per market enquiry on 31.10.2010.

For Building, the construction cost of each type of structure is worked out and market

value as on 31.10.2010 is arrived by after allowing suitable depreciation.

For Plant and Machinery and Lines / Cables Network the open market value as on

31.10.2010 has been worked out after allowing suitable depreciation to the prevailing

cost of new item which includes incidentals. The depreciation considered is separately

for each item and is based on the total life of the equipment and the useful life after

taking into consideration of nature of maintenance provided.

For rest of the fixed assets (Civil works, vehicles, furniture & fixtures and office

equipments) the gross book value as on 31.10.2010 has been taken after deducting

accumulated depreciation proportionately between the assets.


3.4.6 The revaluation reserves are segregated into Revaluation Reserves for depreciable assets

and Land Revaluation Reserves. The accumulated deficit is first adjusted against the Land

revaluation reserves and the balance has been adjusted with Revaluation Reserves of

depreciable assets.

3.4.7 Based on the principles adopted as specified above, the Revaluation of the total assets of

erstwhile TNEB to be adjusted against the Accumulated loss is highlighted below:

Table 3: Adjusted revaluation reserves

*-Revaluation reserves include the adjustment of accumulated depreciation also.

3.4.8 However, as can be analysed, the accumulated deficit is first adjusted with Land Revaluation

Reserves and balance unadjusted deficit of Rs. (11,553) Crores is adjusted with Revaluation

Reserves of the Depreciable Assets. Accordingly, the Revaluation Reserves from the

depreciable assets to be retained and segregated to the successor entities of TNEB will be

Rs. 19,917 Crores.

3.4.9 The balance Revaluation Reserves from the depreciable assets has been allocated to the

Successor entities on a pro-rata basis based on their respective valuation. However,

Revaluation Reserves of TNEB Holding Company of Rs. 488 Crores has been adjusted in the

Revaluation reserve of TANTRANSCO only.

Table 4: Allocation of Revaluation Reserves of Depreciable Assets (RsCrores)

S. No Name of the Fixed Assets Amount (Rs

Crores)

1 Land Revaluation Reserves 19,971

2 Revaluation Reserves of Depreciable Assets 31,470

3 Balance Accumulated Deficit after adjustment (31,524)

4 Accumulated Deficit adjusted with Land Revaluation Reserves

(3+1) (11,553)

5 Adjusted Revaluation Reserves of Depreciable Assets to be

distributed to successor entities - (2+4) 19,917

Particulars Generation Distribution TANGEDCO Transmission Holding Total

Revalued Figure of Depreciable

Assets5,599 27,031 32,630 15,688 497 48,815

Op. Book value as per Balance Sheet 5,599 7,797 13,396 3,940 9 17,345

Revaluation Reserve from

Depreciable assets- 19,234 19,234 11,748 488 31,470

Accumulated Loss to be adjusted (11,553)

Revaluation Reserves of the

Depreciable Assets to be

segregated to successor entities

12,365 12,365 7,552 19,917

Adjustment related to Revaluation

Reserves of TNEB Holding- (488) - (488)

Adjustment for Debt:Equity Ratio (99) (99) 99 -

Revaluation Reserve from Land to

be adjusted - 12,266 12,266 7,164 488 19,917


3.4.10 It is submitted that usually a revaluation reserve is an accounting term used due to

revaluation performed on assets. A revaluation reserves fall under the category of

supplementary capital, in that it does not reflect ordinary business results. It is a non-cash

reserve and because of this revaluation reserves typically are not counted as capital that can

be leveraged for financial institutions, such as a bank's, contractual provisions. The

revaluation reserves will be used only to nullify the effect of additional depreciation arising

out of revaluation of assets and therefore the Revaluation Reserves of depreciable assets

retained with the successor entities can be adjusted against depreciation.

3.4.11 Para 30 of AS-10 provides that the amount added over the net book value should be

credited directly to the owners' interests under a separate heading revaluation reserve.

However, the depreciation on the revalued assets has not been considered under ARR

tabulated in table No. 4 so as to determine the realistic ARR and reduce the burden on the

end consumers so as to provide competitive and quality power.

3.5 Revenue Gap for FY 2017-18 at existing tariff

3.5.1 TANGEDCO has determined the revenue gap for FY 2017-18 considering the projected

annual revenue requirement and revenue at existing tariff.

Table 5: Revenue gap at existing tariff for FY 2017-18 (Rs. Crores)

3.5.2 As per the UDAY scheme entered into by the State Government on 09th January, 2017, it is

already incurring a huge expenditure due to take over of 75% outstanding loans (Rs. 30,420

Crores) as of 30thSeptember, 2015 and conversion of Rs. 3352Crores into equity share

capital. So with a view to reduce the tariff subsidy burden on the State Government,

TANGEDCO has proposed adjustment in tariff for domestic consumers, while retaining the

existing tariffs for the remaining categories of consumers.

3.6 Existing and Proposed Retail tariff schedule for FY 2017-18

3.6.1 The existing and proposed retail tariff schedule is tabulated below.

1 Net revenue requirement 52,277.74

2Revenue from sale of power at existing tariff

(including subsidy)49,827.13

3 Other Govt. Subsidy (FRP bond takeover) 2,343.49

4 Revenue Gap 107.12

S. No. Particulars FY 2017-18


Table 6: Existing and Proposed retail tariff schedule FY 2017-18

Category

Slabs (Per month) Sub Category

Existing Tariff Proposed Tariff

Energy Charges(Rs./kWh

)

Demand charges/Fixed

charges


)


charges

Tariff for Low Tension Consumers

LT-IA Domestic

0-50kWh 3.00 Rs.15/month 2.50 Rs.15/month

51-100kWh 0-50kWh 3.25 Rs.15/month 2.50 Rs.10/month


Above 100kWh-upto 250kWh




Above 250kWh




Above 250kWh

6.60 Rs.25/month 6.60 Rs.25/month

LT-IB Huts

Single slab 4.95 (on

installation of energy meter)

Rs.145/month (until installation of energy meter)

4.95 (on installation of energy meter)

Rs.145/month (until installation of energy meter)

LT-IC LT Bulk supply

Single slab 4.60 Rs.60/month 4.60 Rs.60/month

LT-IIA Public lighting and Water supply

Single slab 6.35 Rs.60/kW/month 6.35 Rs.60/kW/month

LT-IIB(1) Govt. Educational institution etc.


LT-IIB(2) Pvt. Educational institution etc.


LT-IIC Places of Worship

0-60kWh 5.75 Rs.60/kW/month 5.75 Rs.60/kW/month

Above 60kWh 5.75 Rs.60/kW/month 5.75 Rs.60/kW/month

LT-IIIA(1)

Cottage and tiny industries



LT-IIIA(2)

Power Looms



LT-IIIB LT Industries


LT-IV LT Agriculture

Single slab 3.22 (on

installation of energy meter)

Rs.2875/HP/annum

3.22 (on installation of energy meter)

Rs.2875/HP/annum

LT-V LT Commercial


Above 51kWh (for all units)

8.05 Rs.70/kW/month 8.05 Rs.70/kW/month


Category

Slabs (Per month) Sub Category



)


charges


)


charges

LT-VI Temporary Supply


Tariff for High Tension Consumers

HT-IA HT Industries

Single slab 6.35 Rs.350/kVA/month 6.35 Rs.350/kVA/month

HT-IB Railway Traction


HT-IIA Govt. Educational institution etc.


HT-IIB Pvt. Educational institution etc.


HT-III HT Commercial


HT-IV Lift Irrigation Societies

Single slab 6.35 6.35

HT-V Temporary Supply


3.7 Revenue from sale of power

3.7.1 The revenue from sale of power at proposed tariff is based on proposed sales, consumer

load and number of connection as submitted to the Hon’ble Commission in petition dated

27th January, 2017. The category-wise revenue including subsidy from existing and proposed

tariff as estimated by the TANGEDCO is tabulated below.


Table 7: Revenue from sale of power at existing and proposed tariff for FY 2017-18

3.8 Revenue Gap at proposed tariff

3.8.1 TANGEDCO has arrived at the revenue gap of Rs. 107.12 Crores considering the proposed

net revenue requirement and revenue at existing tariffs. The impact on revenue gap

considering the adjustmentin tariff is as shown below. The net revenue gap through the

proposed adjustment in tariff is Rs. 2610.39Crores.

Table 8: Revenue gap at proposed tariff for FY 2017-18 (Rs. Crores)

Existing Tariff

(Rs. Crores)

Proposed Tariff

(Rs. Crores)

LT Consumer Category

LT-IA Domestic 11,374.34 8,871.06

LT-IB Huts 205.85 205.85

LT-IC LT Bulk supply 5.20 5.20

LT-IIA Public l ighting and Water supply 1,980.49 1,980.49

LT-IIB(1) Govt. Educational institution etc. 106.57 106.57

LT-IIB(2) Pvt. Educational institution etc. 242.34 242.34

LT-IIC Places of Worship 97.80 97.80

LT-IIIA(1) Cottage and tiny industries 129.57 129.57

LT-IIIA(2) Power Looms 687.39 687.39

LT-IIIB LT Industries 5,857.00 5,857.00

LT-IV LT Agriculture 3,328.35 3,328.35

LT-V LT Commercial 7,721.90 7,721.90

LT-VI Temporary Supply 483.17 483.17

Total LT 32,219.95 29,716.68

HT Consumer Category

HT-IA HT Industries 12,466.09 12,466.09

HT-IB Railway Traction 712.53 712.53

HT-IIA Govt. Educational institution etc. 1,207.83 1,207.83

HT-IIB Pvt. Educational institution etc. 291.26 291.26

HT-III HT Commercial 2,637.87 2,637.87

HT-IV Lift Irrigation Societies 4.77 4.77

HT-V Temporary Supply 286.82 286.82

Total HT 17,607.18 17,607.18

Total 49,827.13 47,323.86

Particulars

1 Net revenue requirement 52,277.74

2Revenue from sale of power at proposed tariff

(including subsidy)47,323.86

4 Other Govt. Subsidy (FRP bond takeover) 2,343.49

5 Revenue Gap 2,610.39

S. No. Particulars FY 2017-18


4. FORMATION OF REGULATORY ASSETS

4.1 Regulatory Asset

4.1.1 In a general term, regulatory assets include previously-incurred losses that are in the nature

of deferred expenditure and that can be recovered from consumers in future allowed by

regulatory authorities.

4.1.2 As per the Guidance Note on Accounting for Rate Regulated Activities, issued by ICAI, a

Regulatory assets is defined as follows:

“A regulatory asset is an entity’s right to recover fixed or determinable amounts of money

towards incurred costs as a result of the actual or expected actions of its regulator under the

applicable regulatory framework”

4.1.3 The National Tariff Policy has also prescribed guidelines for allowing the facility of regulatory

assets to be recovered with carrying cost. In cases where regulatory asset is proposed to be

adopted, it should be ensured that the return on equity should not become unreasonably

low in any year so that the capability of the licensee to borrow is not adversely affected.

4.1.4 It is submitted that a distribution business is a regulated business whereby the business

activities creates a gap between operational and accounting situations that would not have

arisen in the absence of such regulation. With cost-of-service regulation, there is a direct link

between the costs that an entity is expected to incur and its expected revenue as the rates is

set to allow the entity to recover its expected costs. However, there could be a significant

time lag between incurrence of costs by the entity and their recovery through tariffs.

Recovery of certain costs may be provided for by regulation either before or after the costs

are incurred. Also, the reasons of a need for creation of Regulatory assets can be due to any

or all of the following reasons:

such as infrequent revision of tariffs,

variation in the actual and estimated values of major expenditure along with their

reasons and treatment;

gap between the total validated expenditure and total estimated revenue;

difference between the cost estimated and approved by the appropriate authority;

effect of prescribed and achieved milestones for loss reduction and sharing of

efficiencies and losses;

4.1.5 The Regulatory Assets as specified under Tariff Order No. 1 dated 30th March 2012 is the

unrecoverable loss for the period November 2010 to March 2013. As per the Tariff order

dated 30thMarch 2012, the issue of the Regulatory Assets was dealt in line with the

Regulation No. 13 of the Terms and Conditions of Tariff Regulations 2005 which is stated as

below:


13. Regulatory Asset

(1) Wherever the licensee could not fully recover the reasonably incurred cost at the tariff

allowed with his best effort after achieving the benchmark standards for the reasons

beyond his control under natural calamities and force majeure conditions and

consequently there is a revenue shortfall and if the Commission is satisfied with such

conditions, the Commission shall treat such revenue shortfall as Regulatory Asset.

(2) The regulatory asset shall first be adjusted against the contingency reserve. The balance

regulatory asset, if any, will be allowed to be recovered within a period of three years as

decided by the Commission.

(3) The licensee shall intimate the Commission then and there when such contingency arises.

(4) Any unrecovered gap at the beginning must be covered through transition financing

arrangement or capital restructuring.

4.1.6 As per the Tariff Order, the Hon’ble Commission had expressed a view that the accumulated

losses up to the date of unbundling will have to be dealt with in accordance with Para 5.4.3

of the National Electricity Policy and Tariff Policy. The provisions of the National Electricity

Policy and Tariff Policy envisages that the gap at the time of unbundling will have to be

sorted out by financial restructuring and support from the Government rather than passing

on the accumulated losses to the successor entities.

4.1.7 In line with the National Tariff Policy, National Electricity policy and as per the Tariff Order

dated 30th March 2012, TANGEDCO have not claimed any relief on account of accumulated

losses prior to unbundling on 1-11-2010 in the given petition.

4.1.8 The proposal of TANGEDCO is to create regulatory assets for the unrecovered deficit post

unbundling only. TANGEDCO would like to submit that even though it has requested for

creation of regulatory asset of the amount which is unrecovered deficit all efforts has been

undertaken to reduce such deficit.

4.2 Recovery of Regulatory Asset

4.2.1 As specified under Tariff Order No. 1 dated 20th June 2013 (Page No. 292), the Regulatory

Asset is proposed to be amortized over a period of 5 years commencing from the year 2013

– 2014 onwards. Once the Regulatory Asset is arrived at, 1/5th of the Regulatory Asset

would be amortized along with the carrying cost. The Regulatory Asset would be re-worked

out in 2014 – 2015 and 1/4th of such Regulatory Asset would be amortized in that year and

so on until the entire Regulatory Asset is amortized. The carrying cost would correspond to

the weighted average rate of interest for medium / long term loans of TANGEDCO in the

corresponding year in which the amortization of the Regulatory Asset is done.


4.2.2 Commission had arrived at the consolidatedrevenue gap of Rs. 25,464 Crores as on March

2014 by considering the approved revenue gap for each year and allowing interest expenses

at 11% and also taking into accountthe amortised regulatory asset of Rs. 1,033 Crores as

determined in the tariff order dated 20th June 2013 for FY 2013-14.

4.2.3 Commission considering the letter received from GoTN has estimated the RegulatoryAsset

pertaining to FY 2010-11 at a carrying cost of 11% and has thenamortized 1/4th of the

estimated Regulatory Asset pertaining to FY 2010-11 in FY 2014-15 and arrived at net

regulatory asset.

4.2.4 As per the Tariff Order dated 11thDecember 2014, the treatment of the Regulatory Asset

along with its carrying cost up to 31stMarch 2015 is given below:

Table 9: Regulatory asset approved in last Tariff Order

4.3 Revision in Regulatory Assets

4.3.1 Based on the total gap arrived in this petition, which is cumulative of gap for FY 2011-12 to

FY 2015-16 (final true-up), FY 2016-17 (gap for current year) and FY 2017-18 (gap of ensuing

year), TANGEDCO submits the revised calculation of Regulatory Assets for approval of the

Hon’ble Commission.

Table 10: Regulatory asset proposed in this Petition

Particulars FY 2010-11 FY 2011-12 FY 2012-13 FY 2013-14 FY 2014-15

Opening 0 4145 13514 20270 25464

Additions (Revenue gap

approved by

Commission)

4050 8398 4898 3711 222

Add: Interest Expenses 95 971 1858 2515

Less: Amortised

regulatory asset1033 1033

Closing 4145 13514 20270 25464 24652

Particulars Rs. Crores

FY 2011-12 13591

FY 2012-13 12789

FY 2013-14 13809

FY 2014-15 14314

FY 2015-16 7491

FY 2016-17 4772

FY 2017-18 107

Total Gap Arrived in Petition 66873

Total Regulatory Asset Approved by

the Hon'ble Commission 24652

Add: Tariff Reduction Proposed 2503

Additional Regulatory Asset Proposed 39717

Total Regulatory Asset Proposed 66873


4.3.2 In order to reduce the subsidy burden on the State exchequer post entering into UDAY

scheme, TANGEDCOis proposing adjustment in tariff for domestic consumers and no change

in tariff for the remaining categories of consumers.

4.3.3 Hence the remaining gap of the Rs. 66,873Crores may be allowed to be recovered in the

ensuing tariff petition from the consumer in the deferred years. It is submitted to approve

the revised Regulatory Assets of Rs 66,873Crores based on the revised gaps and after

adjusting the reduction in tariff for domestic consumers as proposed in the given petition.

4.3.4 The percentage of sharing of the Regulatory Asset by Government of Tamil Nadu (GOTN) is

awaited.


5. WHEELING CHARGES

5.1 Background

5.1.1 The Electricity Act 2003 (the Act) allows non- discriminatory Open Access to the network of a

Licensee on payment of applicable charges.

5.1.2 The proposed Wheeling charges, Additional Surcharge, Grid Availability charges and

Restoration Charges for FY 2017-18are detailed in the section below.

5.1.3 The Board maintains separate Balance Sheet for its generation function. Hence the balance

figures out of total revenue and expenditure has been taken for Distribution function.

5.1.4 The following section details the expenses for Distribution function, to be recovered as

wheeling charges from all beneficiaries.

5.2 Summary of Expenses Considered for Wheeling Charges

5.2.1 Operation and Maintenance Expenses, interest on loan, depreciation, return on equity and

other debits considered for calculation of wheeling charges is as per the charges submitted

in Chapter 4 of theARRpetition filed by TANGEDCO on 27th January, 2017.

Table 11: Annual Distribution Charges for FY 2017-18

5.2.2 As the open access is allowed to HT consumers, the wheeling charges are to be determined

on the cost of HT distribution network. Hence, the annual wheeling charges are required to

be allocated between HT and LT in the ration of HT and LT network.

5.2.3 As on 31stMarch 2016, the length of HT and LT lines was in the ratio of 22:78 (1.70 lakh

cktkms :6.11 lakh cktkms).

5.2.4 The annual wheeling charges are allocated among HT and LT category as below.

S. No. Particulars Rs. Crores

1 Net O&M expenses 5534

2 Interest on Loan and Finance Charges 3346

3 Interest on Working Capital 235

4 Depreciation 484

5 Return on Equity 610

6 Other Debits 13

7 Annual Wheeling Charges 10222

8Less: Interest on Consumer Security

Deposits542

9 Net Annual Distribution Charges 9680


Table 12: Allocation of Wheeling Charges into LT and HT Category

5.2.5 The projected units sold through the distribution system during the control period and the

wheeling charges for the control period shall be as below:

Table 13: Wheeling Charges per Unit

5.3 Additional Surcharge

5.3.1 As per National Tariff Policy, 2016, the additional Surcharge should become applicable only,

if it is conclusively demonstrated that the obligation of a licensee, in terms of existing power

purchase commitments, has been and continues to be stranded, or there is an unavoidable

obligation and incidence to bear fixed costs consequent to such a contract. Since, there is a

shortage of available capacity, it is submitted that it is proposed not to claim the additional

surcharge at present.

5.4 Grid Availability Charges

5.4.1 TANGEDCO in this petition is submitting for approval of energy charges plus the energy

equated demand charges applicable to HT Temporary tariff as Grid Availability Charges.

TANGEDCO submits that the Grid Availability Charges are basically forproviding standby

arrangements to Open Access customers in the following cases:

In case of outages of Generator supplying to an open access consumer.

For start-up power by generator.

When the generation as per schedule is not maintained and when the drawal by the

open access consumer is in excess of the schedule.

5.4.2 Also, TANGEDCO submits that it is facilitating standby power supply arrangement for open

access consumers. As per clause 8.5.6 of the National Tariff Policy, it specifies that in case of

open access, a standby arrangement needs to be provided to open access consumers to

safeguard their supply in case of outages of generator. However, such consumer will be

charged a tariff relevant to temporary connection as that standby support will be for a

Particulars Nos Ratio

HT Lines (Lakh Ckt Km) 1.70 21.77%

LT Lines (Lakh Ckt Km) 6.11 78.23%

Total 7.81 100.00%

S. No. Particulars Units FY 2017-18

1 Projected Energy Fed into the Grid MUs 101544.55

2 Transmission Loss upto 110kV % 1.94%

3 Energy sent out in Distribution Network MUs 99574.58

4 Less: Energy Consumed at 110kV MUs 6522.14

5 Less: Loss upto 33kV network % 6.55%

6 Energy fed into 33kV and below MUs 93052.45

7 Annual Wheeling Charges Rs. Crores 2107

8 Wheeling Charges per Unit Ps./kWh 22.64


temporary period of time. The clause is outlined below:

8.5.6 In case of outages of generator supplying to a consumer on open access, standby

arrangements should be provided by the licensee on the payment of tariff for temporary

connection to that consumer category as specified by the Appropriate Commission.

5.4.3 Also, in an interconnection (integrated A.C. grid), since MW deviations from schedule of an

entity are met from the entire grid, the temporary standby support will result into deviation

in the drawl by licensee resulting in UI applicability.

5.4.4 The Hon’ble Commission in tariff order dated 11th December, 2014 approved a separate

tariff category to HT temporary supply and hence, it is prayed to fix the tariff of Grid

availability Charges equivalent to energy charges plus energy equated demand charges

applicable to HT Temporary supply.


6. TARIFF PHILOSOPHY

6.1 Introduction

6.1.1 The Hon’ble Commission issued first tariff order in the year 2003. In the year 2014, the

Commission issued suo-motu tariff order. In the order, the Commission classified various

consumer categories according to their voltage, purpose of utilisation, time of utilisation,

etc. Taking into consideration of difficulties in implementation and to improve quality in

supply and taking into account of directives issued by Hon’ble APTEL and by this Hon’ble

Commission, the following changes/ modifications are submitted for the consideration of

the Hon’ble Commission.

6.1.2 High Tension Tariff

6.1.2.1 Harmonics: Present order specifies that HT IA (Industrial) and HT III category consumers

are only liable to pay compensation charges at 15% of respective tariff if they are

dumping harmonics in the network of TANGEDCO beyond the permissible limits as

specified by CEA regulation. To avoid system hazards and maintain quality supply, it is

submitted that this provision may kindly be extended to all HT consumers excluding HT

Tariff IV (Lift irrigation).Presently, the field engineers are facing problem in collection of

penal charges from which date whether from the date of measurement or from the

date of completion of three months notice period. In order to avoid such ambiguities

necessary modification has been proposed to collect it from the date of measurement.

6.1.2.2 In industrial establishments the facilities incidental to main activities are provided by the

employer and by private players. The facilities provided by the employer can be

considered as bonafide purpose and the services provided by the private players on

commercial basis may not be considered as bonafide. The facilities provided by the

private players may be considered as commercial and charged under respective tariff.

6.1.2.3 TANGEDCO is experiencing difficulties in implementation of respective tariff to

temporary supply for additional construction of below 2000 sq feet. The consumer can

build new construction with minimum square feet by getting temporary supply and

extend further required construction in phased manner to accommodate such

construction within 2000 sq feet with the intention to classify under respective tariff. It

is clear evasion and avoidance of higher temporary supply tariff payment. Further it is

submitted that any construction is to come under single tariff irrespective of new and

additional construction. Hence TANGEDCO submits that any construction in the

premises of HT services have to be classified under LT tariff VI.Accordingly it is submitted

that any additional construction of all HT consumers excluding HT Tariff IV may be billed

under LT Tariff VI. Such construction shall be metered separately and only the energy

charges shall be charged under LT Tariff VI.Such metered energy consumption shall be

deducted from the total consumption registered in the main meter of the HT/EHT supply

for billing.


6.1.2.4 Considering the grid stability and compulsion to maintain required frequency level, it is

submitted that average minimum level of power factor may kindly be enhanced from

0.90 to 0.95.

6.1.2.5 Present order specifies that only for HT industries under Tariff I-A having arc, induction

furnaces or steel rolling process, the integration period for arriving at maximum demand

in a month will be 15 minutes. In ABT regime, the frequency is being monitored at 15

minutes time block. Taking into account of above, it is submitted that the integration

period of 15 minutes for arriving at maximum demand in a month may kindly be

extended to all HT consumers.

6.1.2.6 Presently ToD billing is being adopted to HT I A tariff consumers and they shall be billed

at 20% extra on the energy charges for the energy recorded during peak hours. The

duration of peak hours shall be 6.00 A.M to 9.00 AM and 6.00 PM to 9.00 PM. In R & C

period the duration of 9.00 PM to 10.00 PM was also considered as peak hours. In

practice the load in the system is too high in time duration between 9.00 PM to 10.00

PM. The CERC considered time duration 6.00 PM to 11.00 PM as peak hours. In order to

avoid ambiguities and to avoid difficulties in billing and to reduce demand during this

time, it is submitted that the peak hour’s duration may kindly be modified as 6.00 AM to

9.00 AM and 6.00 PM to 10.00 PM.

6.1.2.7 According to the provisions of present order, the HT I A tariff is applicable to all

manufacturing and industrial establishments and registered factories including tea

estates, textiles, fertilizer plants, steels plants, heavy water plants, chemical plants. This

tariff is meant for manufacturing and industrial establishment only and not for service

units. The commercial establishments such as hotel and bottling plants are also

considered as registered factories and the term registered factories includes service

units also. The LPG bottling plants were classified under HT Tariff I A based on registered

factories. The APTEL in order dated 08-09-2016 in appeal No.265 of 2014 ordered that

LPG bottling plants as Commercial Establishment. In order to avoid service / commercial

units to classify under HT Tariff I A based on the term ‘Registered Factories, it is

submitted to omitthe word ‘Registered Factories’ under HT Tariff I A.

6.1.2.8 The Tariff Order dated 15-03-2003 issued by the Commission had the provision,

“If the HT Industrial Consumers (HT I A) does not for any reason utilise the power load for

more than 30 days, then the current consumption charges for the power utilised and

service for lighting and non-industrial purposes shall be billed under HT III”.

The same provision had been removed in subsequent orders. The electricity tariff

classification is based on their purpose for which electricity is used. Once the electricity

supplied is not used for the purpose for which it is being supplied, it should be billed

under appropriate tariff of HT Tariff III. Hence, it is submitted that this provision may

kindly be reintroduced.


6.1.2.9 The Hon’ble Commission issued order to classify traction, railways station of Chennai

Metro Rail Corporation under Railway Traction Tariff (HT I B) and to classify other

commercial loads such as kiosks, ATMs and shops under commercial service. Challenging

this order, CMRL filed an appeal before the APTEL and TANGEDCO filed a review petition

before this Commission with the request to consider on par with Indian Railway services.

Hence, it submitted to consider CMRL also on par with Indian Railway services.

6.1.2.10 The Tariff order has separate tariff category for Government Educational institutions

including Government aided educational institutions and Private educational

institutions. Most of the Government aided educational institutions are also running

with self-finance courses also. The self finance courses are to be considered as private

educational (non-aid) institution and the applicable tariff to that category is to be

considered under private educational institutions. The field officials are facing problems

in classifying these kind of educational institutions. In order to classify under appropriate

tariff, it is submitted that government aided educational institutions with self financing

course may also kindly be classified under tariff applicable to Private educational

institutions.

6.1.2.11 The Commission in MP.No.32 of 2015 order has ordered to submit a proposal to provide

tariff classification to the category for common loads of residential flats. Considering

purpose, Government and private residential colonies and housing complexes can be

classified under single tariff. Accordingly, it is submitted that Residential colonies and

Housing complexes, Senior citizen communities, Old age Homes, Orphanages and supply

used for their common lighting, water supply, lift may also kindly be classified under

HT Tariff II A.

6.1.2.12 Regulation 25 of the Tamil Nadu Electricity Regulatory Commission (Grid Connectivity

and Intra-State Open Access) Regulations, 2014 provides to classify the supply of

electricity for start-up power under HT Tariff V (Temporary Supply). Accordingly, the

same has been submitted to continue under HT Tariff V.

6.1.3 Low Tension Tariff

6.1.3.1 Considering the grid stability, obligation to maintain quality of power supply and

compulsion to maintain high frequency level, it is submitted that the average minimum

level of power factor to LT consumers whose connected load is 18.6 kW (25 HP) may

kindly be enhanced from 0.85 to 0.90.

6.1.3.2 The fixed charges are being levied to contracted demand from the year 2012 and it is

calculated on the basis of kW. Now, it is submitted with the Commission for approval to

calculate monthly fixed charges on the basis per kW or part thereof.


6.1.3.3 Further it is submitted that as per submission made under HT tariff philosophy, all new

and additional construction under LT categories excluding domestic/Residential

construction may kindly be classified under LT tariff VI.

6.1.3.4 The LT Tariff I A permits to extend electricity supply to provide lighting, water and other

facilities for domestic animals/pets including chaff cutting, milking etc, and watering for

gardening including growing of trees in and around residential houses/buildings. In this

case there is no limitation in area for gardening and other usage in and around

residential houses/ buildings and it can be used for commercial purposes. In order to

have restriction/ limitation and for better implementation, it is proposed to limit area

of usages to 500 square feet.

6.1.3.5 At present, the LT Tariff I A permits to extend electricity supply in respect of multi

tenements/ residential complexes for common lighting, water supply, lift and such other

facilities provided only to the residents alone may be given a separate connection and

charged under LT Tariff I A and only one service connection shall be given for the

premises for all common facilities. It is submitted that the such other facilities includes

gym, community hall, amphi theatres, etc and these facilities could not be considered as

domestic/residential usages. Further, to the multi block residential complexes, a single

common LT service is not sufficient for common lighting, water supply, lift. Several

representations are being received to extend one service for each block for common

usage. Taking into consideration of above, it is submitted to modify this provision as in

respect of multi tenements/residential complexes common supply under domestic tariff

may kindly be limited to common lighting, water supplyand lift. In case of more than one

block in a premise, only one service shall be given for each block for common lighting,

water supply and lift provided only to the residents.

6.1.3.6 Based on submission made in HT tariff philosophy, it is submitted that government aided

educational institutions with self financing course of LT category may also be classified

under tariff applicable to Private educational institutions.

6.1.3.7 It is submitted that training and rehabilitation centres under LT tariff II-(B) I may kindly

be modified as rehabilitation and training centres to avoid ambiguities.

6.1.3.8 It is submitted that blood banks under free of cost may also be classified under

LT Tariff II-(B) I.


6.1.3.9 The present Tariff order specifies that the connected load for supply of electricity shall

not exceed 10 HP in respect of LT Tariff III –A (1) and LT Tariff III – A (2). Consequent to

introduction of static meter with MD recording facilities, it measures accurate

measurements including electrical loss of motor. The consumers under this category are

representing to enhance the load limit of 10 HP. Considering lower efficiency motors

which are used for power loom, it is submitted to modify the connected load to these

categories as 10 kW instead of 10 HP.

6.1.3.10 Present Tariff order permits to extend LT services under tariff III A(1) to Agriculture and

Agriculture allied activities till they reach their seniority under LT Tariff IV for agriculture.

While effecting service connection under LT Tariff III –A (1), the line extension cost is

being borne by the Licensee. In respect of agricultural service under SFS scheme, the

necessary estimate cost for extension should be borne by the consumer. The

consumer who have availed service connection under LT Tariff III – A (1) and reach the

seniority in LT Tariff IV under SFS scheme will not bear the line extension cost, since cost

is already incurred by the licensee whereas, the consumer directly availing service under

LT Tariff IV for agriculture under SFS scheme has to incur such cost. Hence, it is

requested to permit TANGEDCO to collect such cost from the applicant under SFS

category before effecting supply under LT Tariff III A (1). The same clause may be

included in LT Tariff III B category also.

6.1.3.11 The present order permits to extend LT tariff III B to the following categories: All

industries covered under LT Tariff III A (1) and III A (2) shall also fall under this tariff

category if the connected load of such industries exceeds 10 HP. The agriculture and

allied activities are also covered under LT Tariff III – A (1). Since, agriculture and allied

activities are not considered as industries, field officials are finding it difficult to convert

such services under LT Tariff III B when connected exceeds 10 HP. Considering the

difficulties in converting the service, it is submitted to modify this clause of tariff as all

services instead of all industries covered under LT Tariff III A (1) and III A (2) and if the

connected load of such industries exceeds as 10 kW instead of 10 HP.

6.1.3.12 At present there is no certificate being issued to intending industrial consumers and

Udyog Aadhaar Memorandum is being issued and it is submitted to modify tariff clause

accordingly.

6.1.3.13 The Regulation notified by the Commission restrict to extend more than one service

connection in a premise which are not physically segregated and to an establishment

even though it is physically segregated. Presently, to avoid getting HT connection,

consumers have availed more than one service connection with maximum load of 112

kW to an establishment in different ownership names. They have to merge the service

connection and to switch over HT category. Even some of the consumers are ready to

avail HT service connection they are not able to provide adequate infrastructure to

extend HT service connection.


The minimum load to avail HT service connection is 65 kVA where maximum load to LT

service connection is 112 kW. To avoid monthly billing and higher charges payment to

TANGEDCO consumers are not willing to avail HT service connection even though their

demand exceeds 65kW. These are all amounts to revenue loss to TANGEDCO. Taking

into consideration of above and to avoid technical and commercial loss, it is submitted

to levy 20% additional charge from LT services when their contracted load exceeds 65

kW.


7. TARIFF SCHEDULE

TARIFF FOR HIGH TENSION SUPPLY CONSUMERS

7.1 General Provisions applicable for High Tension Supply

7.1.1 Categories of supply: The categories of supply are as specified in the Tamil Nadu Electricity

Distribution Code and Tamil Nadu Electricity Supply Code. The HT tariffs specified for

different categories of HT consumers are also applicable to the consumers who are supplied

at EHT level in accordance with above said Codes.

7.1.2 Harmonics: As specified in the Supply Code, when the consumer fails to provide adequate

harmonic filtering equipment to avoid dumping of harmonics into Licensee’s network

beyond the permissible limits as specified by CEA regulations, the consumer is liable to pay

compensation at 15% of the respective tariff. The measurement of harmonics shall be done

by the Distribution Licensee using standard meters/equipment in the presence of consumers

or their representatives. This compensation charges is applicable to all HT categories of

consumers except HT tariff IV.The TANGEDCO shall issue three months’ notice to the

consumer to reduce the harmonics level within the limits, if the harmonics measured is

more than the permissible limits. The TANGEDCO shall implement the compensation

provision from the date of measurement if the consumer has not been reduced the

measured harmonics level within the permissible limits in above notice period of three

months. As and when the consumer brings down the harmonics within the limit,

compensation charges shall be withdrawn.

7.1.3 In case of supply under HT Tariff, except for HT tariff-IV and V, supply used for creating

facilities for the compliance of Acts/Laws or for the facilities incidental to the main purpose

of the establishment of the consumer, such facilities extended to their

employees/students/patients/residents as the case may be, within the premises of the

consumer, shall be considered to be bonafide purpose. Such facilities to be extended by the

consumer own and not by any outsourcing. However, if such facilities are extended to the

public or provided by outsourcing, the energy consumption to such facilities shall be

metered by the licensee separately and only the energy charged under appropriate LT tariff.

Such metered energy consumption shall be deducted from the total energy consumption

registered in the main meter of the HT/EHT supply for billing.

7.1.4 In case of supply under HT Tariff IA, IIA, II B and III, the use of electricity for residential

quarters, within the premises, shall be metered separately by the licensee if opted by the

consumer and only the energy shall be charged under LT Tariff IC. Such metered

consumption shall be deducted from the total consumption registered in the main meter of

the HT/EHT supply for billing.


7.1.5 In case of HT supply under IA, IIA, IIB, III, the supply used for any additional construction of

building within the consumer’s premises and lavish illumination (as defined under LT tariff

VI) shall be metered separately by the licensee and only the energy shall be charged under

LT Tariff VI. Such metered energy consumption shall be deducted from the total

consumption registered in the main meter of the HT/EHT supply for billing.

7.1.6 Low Power Factor Compensation: In respect of High Tension service connections the

average power factor of the consumers installation shall not be less than 0.95. Where the

average power factor of High Tension service connection is less than the stipulated limit of

0.95 the following compensation charges will be levied.

Particulars Dispensation for Power Factor Compensation

Below 0.95 and up to 0.90 One per cent of the current consumption

charges for every reduction of 0.01 in power

factor from 0.95

Below 0.90 to 0.80 One and half per cent of the current

consumption charges for every reduction of 0.01

in power factor from 0.95

Below 0.80 Two per cent of the current consumption

charges for every reduction of 0.01 in power

factor from 0.95

7.1.7 Billable Demand: In case of HT Consumers, maximum Demand Charges for any month will

be levied on the kVA demand actually recorded in that month or 90% of the contracted

demand whichever is higher.

7.1.8 Provided, that whenever the restriction and control measures are in force, the billable

demand in case of two part tariff for any month will be the actual recorded maximum

demand or 90% of demand quota, as fixed from time to time through restriction and control

measures, whichever is higher.

7.1.9 In case of all HT consumers, the integration period for arriving at the maximum demand in a

month will be fifteen minutes.

7.2 High Tension Tariff I A:

Tariff category

Existing and proposed Tariff

Demand Charge in Rs/KVA/ month

Energy charge in Paise per kWh (Unit)

High Tension Tariff I A 350 635


7.2.1 This Tariff is applicable to:

1) All manufacturing and industrial establishments including Tea Estates, Textiles, Fertilizer

Plants, Steel Plants, Heavy Water Plants, Chemical plants,

2) Common effluent treatment plants, Industrial estate’s water treatment/supply works,

3) Cold Storage Units,

7.2.2 This tariff is also applicable to Information Technology services as defined in the ICT Policy

2008 of Government of Tamil Nadu. The definition is reproduced below:

“IT services are broadly defined as systems integration, processing services, information

services outsourcing, packaged software support and installation, hardware support and

installation.”

7.2.3 Information Technology Services includes:

i. Systems integration includes :

a) Network Management Services

b) Applications Integration

ii. Processing services includes:

a) Outsourced Services in Banking, HR, finance, Technology and other areas

b) Outsourced Bank office support or Business transformation and Process

Consulting Services.

iii. Information Services Outsourcing includes:

a) Outsourced Global Information Support Services

b) Knowledge Process Outsourcing

c) Outsourced Global Contact Centre Operations

d) Outsourced Process Consulting Services.

iv. Packaged Software Support and Installation includes:

a) Software Design and Development, Support and Maintenance

b) Application installation, support and maintenance

c) Application testing.

v. Hardware Support and Installation includes:

a) Technical and network operations support

b) Hardware installation, administration and management

c) Hardware infrastructure maintenance and support


7.2.4 The HT Industrial consumers (HT IA) shall be billed at 20% extra on the energy charges for

the energy recorded during peak hours. The duration of peak hours shall be 6.00A.M to

9.00A.M and 6.00 P.M to 10.00 P.M.

7.2.5 The HT Industrial Consumers (HTIA) shall be allowed a reduction of 5%on the energy charges

for the consumption recorded during 10.00 P.M to5.00A.M as an incentive for night

consumption.

7.2.6 If the HT Industrial Consumers (HT I A) does not for any reason utilise the power load for

more than 30 days, then the current consumption charges for the power utilised and service

for lighting and non-industrial purposes shall be billed under HT III.

7.3 High Tension Tariff I B:

Tariff category




High Tension Tariff I B 300 635

7.3.1 This tariff is applicable to Railway traction of Southern Railway and traction load of CMRL.

7.4 High Tension Tariff II A:

Tariff category




High Tension Tariff II A 350 635

7.4.1 This tariff is applicable for the following services under the control of Central/State

Governments/Local Bodies/TWAD Board/CMWSSB:

1) Educational institutions including government aided educational institutions without

self-financing course and Hostels run by them.

2) Teaching and Training Institutions of Ministry of Defence and CRPF Establishments.

3) Hospitals, Primary Health Centres and Health Sub-Centres, Veterinary Hospitals, Leprosy

Centres and Sub-Centres

4) Public Water Works and Sewage Works and Desalination Plants

5) Public Lighting and Electric Crematorium

6) Public Libraries, Art Galleries and Museums

7) Research Laboratories and Institution


8) Dairy Units

7.4.2 This tariff is also applicable to the following

1) Residential colonies and Housing complexes, Senior citizen communities, Old age

Homes, Orphanages and its common supply used for common lighting, water supply, lift.

2) Hospitals and Rehabilitation centres, Training & Rehabilitation centres, Old Age Homes

and Orphanages run by charitable trusts which offer totally free treatment/services for

all categories of patients/inmates on par with government hospitals and institutions.

3) Desalination plant at Kudankulam nuclear power plant and Minjur Desalination plant of

Chennai Water Desalination Ltd. Water Supply Works by New Tirupur Area Development

Corporation as long as they supply drinking water predominately to local bodies/public.

4) Single point supply to Co-operative group housing society and for the residential

purpose of the employees as specified in “The Electricity (Removal of Difficulties) Eighth

Order 2005”.

5) Actual places of public worship.

7.5 High Tension Tariff II B:

Tariff category




High Tension Tariff II B 350 635

7.5.1 This tariff is applicable to all Private educational institutions, government aided educational

institutions running with self-financing course and hostels run by them.

7.6 High Tension Tariff III:

Tariff category Existing and proposed Tariff



High Tension Tariff III 350 800

7.6.1 This tariff is applicable to all other categories of consumers not covered under High Tension

Tariff IA, IB IIA, IIB, IV and V.

7.7 High Tension Tariff IV:

Tariff category

Existing and proposed Tariff*


Energy charge in Paise per kWh

High Tension Tariff IV Nil 635

*Category to be fully subsidised by Government


7.7.1 This tariff is applicable to the Lift Irrigation Societies for Agriculture registered under Co-

operative Societies or under any other Act.

7.8 High Tension Tariff V

Tariff category




High Tension Tariff V 350 1100

7.8.1 This tariff is applicable to Temporary Supply for construction and for other temporary

purposes.

1) For this category of supply, the initial/in-principal approval for such construction or to

conduct such temporary activity obtained by the applicant from the appropriate

authority, wherever necessary, is adequate to affect the supply.

2) In case of conversion of temporary supply into applicable permanent supply, the same

shall be done subject to compliance of codes/ regulations/ orders.

7.8.2 This tariff is also applicable to start-up power provided to generators. The generators are

eligible to get start-up power under this tariff after declaration of Commercial operation

Date (CoD).

TARIFF FOR LOW TENSION SUPPLY CONSUMERS

7.9 General Provisions applicable for Low Tension Supply

7.9.1 All motors/pump sets connected in this category of supply shall be certified/ approved by

BIS/BEE and motors/pump sets of 3 HP and above shall be provided with adequate BIS

certified capacitors. Non-compliance shall invite compensation charges as specified in the

Codes/Regulations.

7.9.2 In case of other than LT Tariff I-A and LT Tariff IV, all services with a contracted load of 18.6

kW (25 HP) and above should maintain a power factor of not less than 0.90. Where the

average power factor of Low Tension Service connection is less than the stipulated limit of

0.90 the following compensation charges will be levied.

Power Factor Dispensation for Power Factor Surcharge

Below 0.90 and upto

0.80

One per cent of the current consumption charges for every

reduction of 0.01 in power factor from 0.90

Below 0.80 One and half per cent of the current consumption charges for

every reduction of 0.01 in power factor from 0.90


7.9.3 In the event of disconnection of services, the consumers shall be liable to pay the fixed

charges applicable for the respective category during the disconnection period.

7.9.4 In case of LT Tariff IIB 1, II B2, IIC, IIIA 1, IIIA 2, IIIB,V and VI, the fixed charges shall be levied

on the basis of the contracted demand. The monthly fixed charges shall be calculated on the

basis of per kW or part thereof.

7.9.5 Supply to welding sets shall be charged 15% extra irrespective of category and capacity.

7.9.6 The services having contracted demand more than 65 kW shall have to pay 20% additional

on charges payable.

7.10 Low Tension Tariff I A:

Tariff

Consumption slabs –

Range in kWh(units) and billing period (one or

two months)


Fixed charges (Rupees per

month)

Energy charges in

paise / kWh


month)

Energy Charges in

paise / kWh

Low Tension Tariff I-A

For consumers who consume upto 50 units per month or 100 units for two months*

From 0 to 50 units per month (or) 0 to 100 units for two months

15 300 15 250

For consumers who consume from 51 units to 100 units per month (or) 101 to 200 units for two month

From 0 to 50 units per month (or) 0 to 100 units for two months*

15 325 10 250

From 51 to 100 units per month (or)101 to 200 units for two months

15 325 10 150

For consumers who consume from 101 units to 250 units per month (or) 201 units to 500 units for two months


20

350

15

250


350 200


460 300

For consumers who consume 251 units and above per month (or) 501 units and above for two months


350

250


Tariff

Consumption slabs –

Range in kWh(units) and billing period (one or

two months)



month)

Energy charges in

paise / kWh


month)

Energy Charges in

paise / kWh


25 350

25 350


460 460

From 251units and above per month (or) 501 units and above for two months

660 660

*to be subsidised by the Government

7.10.1 This tariff is applicable to the following

1) Domestic/Residential purposes of lights, fans, Air conditioners, including radio/TV and all

other home appliances.

2) Supply used in the house/residence/premises for the following purpose with a total

connected load not exceeding 2 KW.

a) To provide lightning, water and other facilities limited to 500 square foot for

domestic animals/pets including chaff cutting, milking etc.

b) Watering for gardening including growing of trees in and around residential

houses/buildings.

3) Handlooms in residences of handloom weavers and handloom in sheds regardless of the

use of outside labour and where energy is availed of only for lighting and fans and all

other residential uses.

4) Public conveniences and Integrated woman sanitary Complexes.

5) Community Nutrition Centres, Anganwadi Centres, Nutritious Meal Centres.

6) Old Age Homes, Leprosy Centres and sub centres, Orphanages, Home for Destitute run

by Government/Local Bodies/Charitable Institutions rendering totally free services

7) Consulting rooms of size limited to 200 square feet of any professionals attached to the

residence of such professionals. This facility is extended exclusively to take advantage of

using the residence by the professionals.

8) In respect of multi tenements/residential complexes supply used for common lighting,

water supply, lift and such other facilities provided only to the residents alone may be

given separate connection and In case of more than one block in a premise, only one

service shall be given for each block for common lighting, water supply and lift provided

only to the residents.

9) In respect of multi tenements/multi-storey flats/residential complexes having both

domestic and non-domestic utilities, common facilities such as common lighting,


common water supply, lift and such other facilities will be charged under this tariff only

if the non-residential built up area does not exceed 25% of the total built up area.

10) In multi tenements residential building/Group Houses the additional service connections

requested by the owners/tenants shall be given. If only a meter is required to effect the

additional service connection, service line charges shall not be collected.

11) Electric crematorium by local bodies.

12) Handicraft/ artisan works carried out by Potters, Goldsmiths etc. attached to the

residence, done predominantly by self or family members using a connected load not

exceeding 1 kW. This facility is extended exclusively to take advantage of utilizing the

space in and around the residence and participation of family members in the small

scale production.

13) Any additional lights, serial lights etc. used in the pandals /shamiana and in the premises

of the existing domestic/residential service connection of the consumer for a period not

exceeding one week at a time, with a connected load not exceeding 3 kW for the family

functions/occasions.

7.11 Low Tension Tariff I B:

Tariff Description

Existing and proposed Tariff Rate*

Energy charges in

Paise / kWh

Fixed charges (Rupees / Month)

Low Tension Tariff I-B

Till installation of Energy Meter

Nil 145

On Installation of Energy Meter

495 NIL

*Category to be fully subsidised by the Government.

7.11.1 This tariff is applicable to huts in Village Panchayats and special grade panchayats, houses

constructed under Jawahar Velai VaiippuThittam, TAHDCO Kamarajar Adi Dravidar housing

schemes, huts in Nilgiris District and hut with concrete wall in the schemes of state and

central Governments. This tariff is applicable subject to following conditions:

1) Hut means a living place not exceeding 250 square feet area with mud wall and the

thatched roof / tiles / asbestos / metal sheets like corrugated G.I. sheets for roofing/

concrete Roof and concrete wall with specification of square feet as approved in the

schemes of State/ Central Government.

2) Only one light not exceeding 40 watts shall be permitted per hut.

3) As and when the government provides other appliances such as Colour TV, fan, Mixie,

Grinder and Laptops to these hut dwellers, the usage of appropriate additional load may

be permitted.


7.11.2 Whenever the norms prescribed in 1) to 3) above is violated, the service category shall be

immediately brought under Low Tension Tariff I-A and billed accordingly.

7.12 Low Tension Tariff I C:

Tariff Tariff Existing and Proposed

Energy charges in

paise / kWh

Fixed charges (Rupees /

Month)

Low Tension Tariff I-C 460 60

7.12.1 This tariff is applicable to LT bulk supply for residential colonies of employees such as railway

colonies, plantation worker colonies, defence colonies, Police Quarters, Residential quarters

of Kudankulum Nuclear power project etc.

7.12.2 The energy charge of this tariff is also applicable for the HT/EHT consumers who opt for

extending supply under this category for their residential colonies / quarters.

7.12.3 Single point supply to Cooperative group housing society and for the residential purpose of

the employees as specified in “The Electricity (Removal of difficulties) Eighth Order 2005”.

7.13 Low Tension Tariff II A:

Tariff

Existing and Proposed

Energy charges

in paise / kWh

Fixed charges

(in Rupees per kW per Month)

Low Tension Tariff II-A 635 60

7.13.1 This tariff is applicable to Public Lighting by Government/Local Bodies and Public Water

Supply and Public Sewerage System by Government/Local bodies /TWAD Board/CMWSSB.

7.13.2 Private agriculture wells/private wells hired by Government/Local Bodies/CMWSSB/TWAD

Board/to draw water for public distribution,

7.13.3 Public Water Supply by New Tirupur Area Development Corporation as long as they supply

drinking water predominantly to local bodies/public and Public Water Supply in plantations

colonies.

7.13.4 Separate service connections for street lights for SIDCO and other Industrial Estates.


7.13.5 Supply to Railway Level Crossing.

7.14 Low Tension Tariff II B (1):

Tariff

Existing and Proposed

Energy charges in paise / kWh

Fixed charges (in Rupees per kW per month)

Low Tension Tariff II-B (1) 575 60

7.14.1 This tariff is applicable to the following entities owned or aided by the

Government/Government Agencies/Local Bodies:

1) Educational Institutions including government aided educational institutions without

self-financing course and hotels run by them

2) Welfare institutions and hostels run by such institutions, other hostels,

youth/student hostels and scouts camp.

3) Hospitals, Dispensaries, Primary Health Care Centres and sub-centres and Veterinary

Hospitals.

4) Research Laboratories/Institutes,

5) Elephant Health Camp

6) State Legal Udhavi Maiyam

7) Art Galleries and Museums

8) Public Libraries

7.14.2 This tariff also is applicable to the following entities which offer totally free services.

1) Dispensaries, Creches and Recreation centres

2) Libraries

3) Emergency Accident Relief centres on highway, Hospitals and Rehabilitation Centres

for mentally ill and blind and others, Terminal Cancer Care centre and Hospital in

Tribal Areas.

4) Institutes run for/ by the physically challenged

5) Rehabilitation and Training Centres

6) Student Hostel

7) Blood banks

7.14.3 This tariff is also applicable to Private Art Galleries and Museums run with service motive.

7.15 Low Tension Tariff II B (2):

Tariff Existing and Proposed Tariff

Energy charges in paise / kWh

Fixed charges (in Rupees per kW per month)

Low Tension Tariff II-B (2) 750 60


7.15.1 This tariff is applicable to Private educational institutions, government aided educational

institutions with self-financing course and hostels run by them.

7.16 Low Tension Tariff II C:

Tariff Consumption slabs –

Range in kWh and

billing period

Existing and Proposed Tariff *

Fixed Charges

(Rupees per

kW per month)

Energy Charges in

Paise per kWh

Low Tension

Tariff II-C

0 to 60 units per

month or 0 to 120

units bimonthly

60

575

Above 60 units per

month or above 120

units bimonthly

575

*category to be subsidised by the Government

7.16.1 This tariff is applicable to actual places of public worship including Trichy Rock fort Temple,

its environs and for the road and path ways leading to the temple.

7.16.2 The existing concessions to the actual places of worship as already notified by GoTN having

annual income less than Rs. 1,000 shall be continued under the same terms and conditions,

until further Order of the Commission.

7.17 Low Tension Tariff III A (1):

Tariff Consumption slabs – Range in

kWh and billing period

Existing and Proposed Tariff

Fixed Charges

(Rupees per kW

per month)

Energy Charges

in Paise per

kWh

Low Tension

Tariff III-A(1)

0 to 250 units per month or 0 to

500 units bimonthly

20

400

From 251 and above units per

month or 501 units and above

bimonthly

460

7.17.1 The contracted load for supply under this tariff category shall not exceed10 kW.

7.17.2 This tariff is applicable to Cottage and tiny industries, Micro enterprises engaged in the

manufacture or production of goods pertaining to any industries specified in the first

schedule to Industries (Development and Regulations) Act 1951 (Central Act 65 of 1951).


7.17.3 The intending consumers applying for service connection under LT Tariff III A (1) claiming to

have established the micro enterprise engaged in the manufacture or production of goods

shall produce the cottage industries certificates from the industrial department

/acknowledgement issued by the District Industries Centre under the Micro Small and

Medium Enterprises Development Act, 2006 (Act 27 of 2006) as proof for having filed

Entrepreneurs Memorandum for setting up of Micro Enterprises for manufacture or

production of goods with District Industries Centre under whose jurisdiction the Enterprise is

located.

7.17.4 The existing consumers who are classified under LT Tariff III A (1) based on the SSI / Tiny

Industries Certificate may be continued to be charged under the same tariff.

7.17.5 This tariff is applicable to Small Gem cutting units, Waste land development, laundry works,

and Common effluent treatment plants.

7.17.6 This tariff is also applicable to Coffee grinding, Ice factory, Vehicle Body building units, saw

mills, rice mills, flour mills, battery charging units and Dairy Units.

7.17.7 This tariff is also applicable for sericulture, floriculture, horticulture, mushroom cultivation,

cattle farming, poultry and bird farming, dairy and fish/prawn culture.

7.17.8 This tariff is also applicable for pumping of water/supply of water for the purpose of

“agriculture and allied activities” as specified in LT Tariff IV provided that the applicant is

unable to get supply under LT tariff IV as per the seniority maintained specifically for the

purpose of providing supply to Agriculture under LT tariff IV. The applicant registered under

SFS category shall reimburse entire estimated cost for extension before effecting supply

under this tariff. Such LT Tariff III-A(1) consumer is eligible to apply for LT Tariff IV. As and

when such applicant becomes eligible to get regular supply under LT Tariff IV as per the

specific seniority maintained for that purpose by the licensee, the supply obtained under LT

Tariff III-A(1) for the specific purpose mentioned in this sub clause shall be converted into LT

tariff IV. Thereafter, the terms and conditions of LT Tariff IV only will apply.


7.18 Low Tension Tariff III A (2):

Tariff Consumption slabs – Range in kWh

and billing period

Existing and Proposed Tariff

Fixed Charges (Rupees

per kW per month)

Energy Charges in

Paise per kWh

Low

Tension

Tariff

III-A(2)

(i) For consumer who consume up to 250 units per month (or) 500 units for two

months

0 to 250 units per month or 0 to 500

units bimonthly 60 520

(ii For consumer who consume up to 251 units and above per month (or) 501 units

and above for two months

0 to 250 units per month or 0 to 500

units bimonthly

60

520

From 251 to 500 units per month or

501 to 1000 units bimonthly 575

From 501 to 750 units per month or

1001 to 1500 units bimonthly 575

From 751 units and above per month

or 1501 units and above bimonthly 575

7.18.1 The contracted load shall not exceed 10 kW under this category.

7.18.2 This tariff is applicable to Power looms, Braided Cords Manufacturing and related ancillary

tiny industries engaged in warping, twisting, and winding.

7.19 Low Tension Tariff III B:


Fixed Charges

(Rupees per kW per month)

Energy Charges in

Paise per kWh

Low Tension Tariff III-B 35 635

7.19.1 This tariff is applicable to all services covered under LT Tariff III A (1) and III A (2) shall also

fall under this tariff category, if the contracted load of such services exceeds 10 kW.

7.19.2 This tariff is also applicable to Information Technology services as defined in the ICT Policy

2008 of Government of Tamil Nadu and amended from time to time. The definition is

reproduced below:

“IT services are broadly defined as systems integration, processing services, information


services outsourcing, packaged software support and installation, hardware support and

installation.”

7.19.3 Information Technology Services includes:

(i) Systems integration includes :

a) Network Management Services

b) Applications Integration

(ii) Processing services includes:

a) Outsourced Services in Banking, HR, finance, Technology and other areas

b) Outsourced Bank office support or Business transformation and Process Consulting

Services.

(iii) Information Services Outsourcing includes:

a) Outsourced Global Information Support Services

b) Knowledge Process Outsourcing

c) Outsourced Global Contact Centre Operations

d) Outsourced Process Consulting Services.

(iv) Packaged Software Support and Installation includes:

a) Software Design and Development, Support and Maintenance

b) Application installation, support and maintenance

c) Application testing.

(v) Hardware Support and Installation includes:

a) Technical and network operations support

b) Hardware installation, administration and management

c) Hardware infrastructure maintenance and support.

7.19.4 The intending consumers applying for service connection under LT Tariff III B claiming to

have established the industries engaged in the manufacture or production of goods shall

produce Udyog Aadhar Memorandum from the District Industries centre.

7.19.5 This tariff is also applicable for pumping of water/supply of water for the purpose of

“agriculture and allied activities” as specified in LT Tariff IV provided that the applicant is

unable to get supply under LT tariff IV as per the seniority maintained specifically for the

purpose of providing supply to Agriculture under LT tariff IV. Such LT Tariff III- B consumer is

eligible to apply for LT Tariff IV. The applicant registered under SFS category shall reimburse

entire estimated cost before effecting supply under this tariff. As and when such applicant


becomes eligible to get regular supply under LT Tariff IV as per the specific seniority

maintained for that purpose by the licensee, the supply obtained under LT Tariff III- B, for

the specific purpose mentioned in this sub clause shall be converted into LT tariff IV.

Thereafter, the terms and conditions of LT Tariff IV only will apply.

7.20 Low Tension Tariff IV:

Tariff Description

Existing Tariff Rate

Energy charges

in Paise / kWh

Fixed charges (Rupees

per HP per annum)

Low Tension Tariff IV

Till installation of Energy Meter

Nil 2875

On Installation of Energy Meter

322 NIL

*category to be subsidised by the Government

7.20.1 This tariff is applicable for pumping of water/supply of water to all agricultural and allied

activities such as cultivation of food crops, vegetables, seeds, trees and other plants.

Sericulture, floriculture, horticulture, mushroom cultivation, cattle farming, poultry and

other bird farming, fish/prawn culture carried out as allied activities of agriculture shall be

construed as agricultural activities.

7.20.2 The services under this tariff shall be permitted to have lighting loads up to 50 watts per

1000 watts of contracted load subject to a maximum of 150 watts inclusive of wattage of

pilot lamps for bonafide use.

7.20.3 Subject to the limit of contracted load, the supply under this category can be utilised for

milking, sugar cane crushing, harvesting, stalk/chaff cutting, thrashing and cleaning of

agricultural produces, crane used for lifting mud/silt from well by having a change over

switch as approved and sealed by the licensee. The change over switch is meant for using

the supply either to the pump set or to any one or more of the purposes mentioned in this

clause. Using supply both to the pump sets and to the other purpose(s) at the same time is

strictly prohibited. The consumer shall abide by the safety norms for any additional wiring

for this purpose.

7.20.4 This tariff is applicable irrespective of owner ship of land if the usage of electricity is for

agriculture and its allied activities.

7.20.5 Agricultural consumers shall be permitted to use the water pumped from the well for

bonafide domestic purposes in the farmhouse including for construction of farm house and


sheds for allied works.

7.20.6 Supply for other purpose exceeding the limit permitted for lighting purpose shall be

provided only by separate service connections under appropriate LT Tariff. Service

connections for water pumping for non-agricultural purpose under appropriate tariff is

permitted in the same well.

7.20.7 This Tariff is applicable to pump sets of Tamil Nadu Agriculture University and Research

centres, Government Seed Farms, pump sets of Tamil Nadu Forest department, Pump sets

of Government coconut nurseries, Pump sets of Government oil seed farms.

7.20.8 Pumping and purifying of drainage water for the purpose of agriculture use.

7.21 Low Tension Tariff V:


Fixed Charges (Rupees per kW per month)

Energy Charges in Paise per kWh

For consumer with consumption 50 units per month or 100 units bimonthly

70

500

For consumer with consumption above 50 units per month or above 100 units bimonthly

805

7.21.1 This tariff is applicable to consumers not categorized under LT IA, IB, IC, IIA, IIB (1), II B (2),

IIC, IIIA (I), III A (2), IIIB, IV and VI.

7.21.2 In respect of multi tenements/multi-storeyed buildings/residential complexes where the

number of flats/Tenements utilized for commercial and other purposes exceeds 25% of the

total built up area, the LT services relating to common utilities such as common lighting,

water supply, lift and other facilities shall be charged under this tariff.

7.21.3 In respect of residential complexes used for domestic, the common facilities such as Gym,

swimming pool, recreation clubs indoor stadiums and grounds, indoor and community halls,

amphi theatres, shops etc will be charged under this tariff.

7.22 Low Tension Tariff VI:


Energy charges in paise /

kWh

Fixed Charges (Rupees per kW per month)

Low Tension Tariff VI 1200 345


7.22.1 This tariff is applicable for supply of power for temporary activities, construction of buildings

and lavish illumination.

7.22.2 The electricity supply for construction in the premises of an existing consumer shall be

provided only through a separate service connection and charged under this tariff.

7.22.3 For temporary supply, the initial/ in –principle approval for such construction or to conduct

such temporary activity obtained by the applicant from the appropriate authority, wherever

necessary, is adequate to effect the supply.

7.22.4 In case of conversion of temporary supply into applicable permanent supply, the same shall

be done subject to compliance of codes/regulations/orders.

7.22.5 In case of lavish illumination, if the illumination is done frequently or permanently, separate

regular service connection shall be provided for lavish illumination and charged under this

tariff.

7.22.6 If the supply is availed for short duration for the temporary activity/illumination from an

existing metered service connection, the computation of energy/fixed charges for temporary

illumination/activity shall be done based on the contracted load and duration of temporary

supply. Contracted load shall be accounted in kW or part thereof. Fixed charges shall be for a

month or part thereof. Due credit for such computed energy, limited to the meter

consumption of the respective billing period, shall be given in the energy recorded by the

meter during the respective billing period for the purpose of regular billing of the existing

service connection. The consumer shall abide by the safety norms for wiring.

7.22.7 The following are considered as Lavish Illumination

1) Illumination done for hoardings and advertisement boards.

2) Extra/additional illumination done outside the building and in the open areas for

parties/functions/occasions.

3) Illumination done in the outer surface/outside the buildings/shops by display lights,

serial lamps, decorative lights, special effect lamps, neon lamps, ornamental lamps,

flood lights etc.

4) Temporary Illumination done for public meetings in pandals/ shamianas, path ways,

streets and roads.

Explanation: The supply used for the purpose of indicating/displaying the name and other

details of the shops/buildings shall not be considered as lavish illumination.


7.23 Applicability of the Tariff Schedule

7.23.1 The above tariff schedule shall be read with the General Terms and Conditions of Supply

Code and Distribution code specified by the Commission.


8. COMPLIANCE OF DIRECTIVES

8.1 Preamble

8.1.1 In the Tariff Order issued by TNERC on 20th June 2013, the Hon’ble Commission has

provided certain directives to TANGEDCO. This section will be dealing with the latest status

of compliance/ action taken by the TANGEDCO in relation to the directives.

S.No. Directives Action Taken

1.

7.1a) To file their Tariff Petition on a timely basis

every year, as per the TNERC Tariff Regulations. This directive is being complied with.

2.

7.1 b)To maintain quality of supply as specified in

Tamil Nadu Electricity Distribution Standards of

Performance Regulations dated 21-07-2004.

Action is being taken to maintain the quality of

supply in all the 9 (nine) regions of TANGEDCO in

respect of voltage improvement in low voltage

pockets, rectification of overloaded Distribution

Transformers , erection of LT/HT networks and

erection of new Distribution Transformers

3. 7.1 c) The Commission likes to reiterate that

TANGEDCO shall submit a well-structured cohesive

business plan and detailed individual schemes for

the planned capacity additions as well as system

strengthening plans. All such plans and schemes

shall be submitted to the Commission in accordance

with the Terms and Conditions of Tariff Regulations

2005 and its Amendments dated 09-04-2014, MYT

Tariff Regulations 2009, as well as Licensing

Regulations 2005. The submission for approval in

this regard so far has been highly unsatisfactory. The

Commission has been addressing the utilities byway

of letters as well as by way of directions. The

compliance to such letters and directions will have

to be serious and without fail.

The Capital Investment Plan for the FY 2014-15 &

2015-16 and the present control periods i.e.,FY

2016-17,FY 2017-18 &FY 2018-19 have already

been submitted before the Hon’ble

commission.

4. 7.1 d) To file the progress of the capital expenditure

and capitalization on a quarterly basis. Commission

likes to emphasize that TANGEDCO submit their

capital expenditure and capitalization plans as per

the formats communicated by the Commission on a

timely basis.

5. 7.1 e) The amount approved for R&M expenses

should not be diverted for any other purpose.

This directive is being complied with.

6. 7.1 f) To submit a time bound program for 100%

metering at feeder level and at distribution

transformer level.

Feeder level Metering: The status of feeder

metering from 230 KV to 11 KV feeder voltage

level as on 31.03.2016 is 99.65%.


Distribution Transformer Level metering:

1) Under RAPDRP Project,50136 nos. of

Distribution Transformers covered. under 110

towns were provided with AMR compatible

meters for the period ending 31.03.2016.

2) Under IPDS scheme, 522 towns not

covered under R-APDRP schemeare

identified for strengtheningof sub transmission

and distribution network in the urban areas.

Metering of Distribution Transformer/

feeders is one of the component under the

above scheme. About 35500Distribution

Transformers are proposed to be metered

with AMR meters in the 522 towns /cities under

the above scheme.

7. 7.1 g) To provide the monthly energy demand and

availability and its plan of scheduling power in

accordance to MoD on quarterly basis.TANGEDCO

is also directed to submit such information in

revised formats as provided by the Commission.

This directive is being complied with.

8. 7.1 h)To take prior approval from the Commission

for purchasing energy from unapproved sources.

Petitions are being filed on a quarterly basis

for approval and ratification of dispatch of high

cost IPPs regularly.

9. 7.1 i)To pay transmission charges determined by

the Commission to TANTRANSCO based on the

allotted transmission capacity for FY 2014-15.

Due to critical financial position of TANGEDCO,

the payment commitment to TANTRANSCO

could not be met fully. However the monthly

payment commitment of TANTRANSCO is

being met by the TANGEDCO. The entire

obligation of TANGEDCO towards

TANTRANSCO would be met in due course of

time.

10. 7.1 j) To file to the Commission its quarterly FPCA

petitions to recover the actual cost of fuel

incurred and the actual cost of power purchase.

While entering to UDAY scheme, the

Government of India has exempted TANGEDCO

from filing of quarterly FPCA petitions.

11. 7.1 k) To conduct a scientific study for accurate

measurement of T&D Loss and unmetered

consumption.

The distribution loss for 168 nos. of feeders (4

feeders from 42 EDCs) was calculated based on

REC Methodology, To validate the result

obtained from the above, the technical loss

calculated based on REC Methodology was

compared with line loss calculated based on

measured data, in Karattadiapalayam 11 KV


feeder(100% consumer indexed) emanating

from N.G.Palayam 110 KV SS in Gobi EDC of

Erode Region. The line loss was calculated for

10 months period from November 2015 to

August 2016 and both the results are found to

be comparable.

12. 7.1 l) To start maintaining regulatory accounts for

the purpose of ARR.

The Commission in Tariff Order dated 20-06-

2013 directed the TANGEDCO to maintain

Regulatory Accounts. In this regard, it is

submitted with the following:

TANGEDCO would like to inform that the

directive was issued by Hon’ble Commission in

light of the development at Forum of

Regulators (FOR) on Standardization of

Regulatory Accounts. The FOR had issued the

Final Report on the same in October 2012. The

intent of having standardization of accounts

was to take care of regulatory provisions

specified by SERCs. The report envisaged

preparation of Balance Sheet and Profit & Loss

Account considering norms specified by SERC

in Tariff Regulations and approvals as per Tariff

Order. For eg. In normal accounting practice,

the audited accounts would not have

Normative Loan balance appearing on Liability

side or Interest on Normative Working Capital

appearing in P&L side. The intent was to have

separate set of accounts for Regulatory

purposes so that stakeholders have better

clarity on regulatory approvals.

The Report in the clause at 5.1 – Reporting

System specifies that this Reporting System

shall come into force from the date of

publication in Official Gazette which is pending

till date. The relevant extract from the report

is provided for reference as under:

“(a) This Reporting System shall be called “The

Reporting System on Power Regulatory

Accounting -2012”.

(b) …

(c) …

(d) This Reporting System shall come into force


from the date of their publication in the Official

Gazette.”

TANGEDCO submits that none of the utility has

so far implemented this new Reporting System

of Regulatory Accounts and believes that the

present Accounting System (under Indian

Companies Act 1956 and Income Tax Act 1961)

for the purpose of Truing-up is adequate to

take care of necessary compliances as per

applicable provisions of Tariff Regulation. The

Hon’ble Commission approves expenses under

Truing-up process considering regulatory

norms and approvals in Annual performance

Review with the support of Audited Accounts.

TANGEDCO further submits that as and when

such Reporting System is notified, it would

comply with the same in true spirit.”


9. PRAYERS

9.1 TANGEDCO respectfully prays to the Hon'ble Commission:

9.1.1 To admit the petition seeking tariff adjustment for FY 2017-18 as per the provisions of

TNERC (Terms and Conditions of Tariff) Regulations, 2005 and MYT Regulations, 2009;

9.1.2 To approve the total recovery of Final True up of FY 2011-12 to FY 2015-16 and Aggregate

Revenue Requirement for FY 2016-17 to FY 2018-19 and other claims as proposed by

TANGEDCO.

9.1.3 To allow TANGEDCO to make claim in the present petition as per notification of the Final

Transfer Scheme, 2015.

9.1.4 To approve the Regulatory Assets as proposed in the petition for the cumulative period from

FY 2011-12 to FY 2017-18 and allow the recovery of the regulatory assets to be approved by

the Hon’ble Commission.

9.1.5 To approve cross subsidy surcharge and all such other charges including Wheeling Charges

and Losses in relation with Open Access granted to consumers in accordance with the

provisions of the EA 2003 for the year 2017-18 based on the correct level of cross subsidy for

FY 2017-18.

9.1.6 To charge the existing tariff approved in Tariff Order dated 11th December, 2014 until the

approval of new tariff for FY 2017-18.

9.1.7 To grant any other relief as the Hon'ble Commission may consider appropriate.

9.1.8 To pass any other order as the Hon’ble Commission may deem fit and appropriate under the

circumstances of the case and in the interest of justice.

9.1.9 To condone any error/omission and to give opportunity to rectify the same.

9.1.10 To permit the Petitioner to make further submissions, addition and alteration to this Petition

as may be necessary from time to time.

tamil nadu electricity regulatory … adjustment...before the hon’ble tamil nadu electricity...

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