CASE NO.56/2001 & 7/2002

Present : Shri D.C. Sahoo, Chairman
            Shri H.S. Sahu, Member
            Shri B.C. Jena, Member

Date of Hearing: 19.03.2002
Date of Order: 19.04.2002

IN THE MATTER OF An application for approval of Revenue Requirement for the FY 2001-02 and for Retail Supply Tariff and charges for FY 2001-02 under Section 26 of Orissa Electricity Reform Act, 1995.


For approval of Annual Revenue Requirement for financial year 2002-03 under Section 26(4) of the Orissa Electricity Reform Act 1995 read with condition 21.1 of the Orissa Retail Supply License 1997 (No.2/97).



Order on Distribution and Retail Supply Tariff and approval of Revenue Requirement for FY 2001-02 & 2002-03 for NESCO (Case No.56/2001 & 7/2002)

  1. Procedural History

  2. Legal Objections as to the maintainability of the Cases

  3. NESCO’s Proposal

  4. Objections during hearing

  5. Queries by Director (Tariff)

  6. NESCO’s reply to clarifications and queries of the Commission

  7. NESCO’s response to issues raised by Director(Tariff)

  8. Commission’s observation and analysis of licensee’s proposal

  9. Scenario of the power sector reform in Orissa

  10. Restructuring of the Power Sector

  11. Strategies for improvement of power sector

  12. Depreciation of DISTCOs

  13. Reasonable Return

  14. Treatment of Working Capital

  15. T & D Loss

  16. Method of determination of Power Purchase

  17. Determination of expected revenue

  18. Collection efficiency of DISTCOs

  19. Summary of revenue requirement of DISTCOs for FY 2001-02 & 2002-03

  20. Operating Expenses

  21. Employees Cost

  22. Repair & Maintenance Expenses

  23. Administration & General Expenses

  24. Interest on Loan

  25. Depreciation

  26. Bad & Doubtful Debt

  27. Contribution to contingency reserve

  28. Capital Base

  29. Receipts against consumers contribution

  30. Original cost of Work in Progress

  31. Compulsory Investment under Para IV

  32. Working Capital

  33. Average Cash and Bank Balance

  34. Accumulated Depreciation

  35. Loans and Bonds

  36. Consumers’ Security Deposit

  37. Reasonable Return

  38. Miscellaneous Receipt

  39. Revenue requirement Reasonable return & clear profit

  40. Tariff Issues

  41. Tariff Hike

  42. Wheeling Charges

  43. Load Factor Billing

  44. Incentive for prompt payment

  45. Incentive for maintaining high power factor

  46. Metering of street lights

  47. Industrial policy framed by Government of Orissa

  48. Salt Production Industries

  49. Multi-Year Tariff

  50. Consumer Service

  51. Construction Power

  52. Observation for over-drawal penalty clause

  53. Observation for incentive for higher consumption

  54. Treatment of past losses

  55. Demand charge during statutory power-cut

  56. Meter rent

  57. Quality of supply and service

  58. Un-authorised and illegal abstraction of electricity

  59. Rural Electrification

  60. Special tariff for Power Intensive Industries

  61. Emergency power supply to CPPs   

  62. Corrective measures and alternative calculation of revenue requirement

  63. Expected Revenue from Charges

  64. Tariff Revision Proposal

  65. Annex- A1        Revenue Requirement for FY 2001-02

  66. Annex -B1        Calculation of Capital Base and Reasonable Return for FY- 2001-02

  67. Annex -C1        Calculation of Clear Profit for FY- 2001-02

  68. Annex -A2        Revenue Requirement for FY 2002-03

  69. Annex -B2        Calculation of Capital Base and Reasonable Return for FY - 2002-03

  70. Annex -C2        Calculation of Clear Profit for FY 2002-03

  71. Annex – D1        Tariff effective from 1st February, 2001

  72. Annex – D2        NESCO’s Tariff revision proposal for FY 2001-02

  73. Annex – D3        Tariff schedule for FY 2002-03

M/s North-Eastern Electricity Supply Company of Orissa Ltd., Januganj, Balasore (NESCO, in short), the holder of The Orissa Distribution and Retail Supply Licence, 1999 (No.3/1999) has submitted two applications u/s 26 of the Orissa Electricity Reform Act, 1995 (Reform Act, 1995, for short) in respect of its Revenue Requirement and Tariff for Retail Supply of electricity for different categories of consumers. Its application for determination of Tariff for the Financial Year 2001-2002 has been registered as Case No.56/2001 and application for Revenue Requirement for the Financial Year 2002-2003 has been registered as Case No.7/2002. Both the Cases being inter-related to each other have been heard analogously and are being disposed off by this common order.