The Kerala State Electricity Regulatory Commission (KSERC) will hold an online hearing on the draft KSERC (Terms and Conditions for Determination of Tariff) Regulations, 2021, on Wednesday.
While the Commission is pushing for certain changes in the terms and conditions, the draft has drawn criticism, especially from the power sector unions, for its alleged pro-privatisation drift and the inclusion of clauses that are reportedly harmful to the Kerala State Electricity Board (KSEB).
The KSEB too is likely to formally convey its objections to the draft proposals at the hearing.
The draft says that the retail supply tariff for each category of consumers of the different distribution business/ licensees in will be determined by the Commission ‘separately.’ Under the existing 2018 regulations, the retail supply tariffs are uniform. Another proposal is that the the Commission can allow the distribution licensee (the KSEB, for example) to sell surplus electricity to consumers instead of selling it in the open market. Open access consumers (industries) can purchase it at power exchange prices.
The above proposals and a clause on ‘Average Power Purchase Cost’ (APPC) have drawn flak on the grounds that they could cripple the KSEB financially.
APPC, as per the draft, is the rate at which the distribution licensee (KSEB) shall purchase excess energy injected into the power system by a renewable energy ‘prosumer.’ But critics point out that the APPC, which reportedly seeks to replace the current mechanism of ‘Average Pooled Cost of Power Purchase,’ will hurt the KSEB finances as it does not include the cost of KSEB’s own generation.
KSEB unions fear that the decision to determine the retail tariffs of the different licencees ‘separately’ will hurt the present cross subsidy system and enable - once the proposed amendments to the Electricity Act get passed - private players in power distribution to ‘cherry-pick’ high-end consumers.
The clause on surplus power sales, it is alleged, will, in effect, prevent the KSEB from earning some additional revenue after meeting the supply obligations to its consumers.
The CITU-backed officers' and workers unions of the KSEB and the INTUC had come out against the draft saying that it supports the privatisation policies of the Central government.
The online hearing will begin at 10.30 a.m.
