493

EXTRAORDINARY

No. 2

GOVERNMENT OF GOA

Department of Power

Office of the Chief Electrical Engineer

___

Notification

120/03/JERC/MYT/CEE/Tech

The Electricity Department, Government of Goa, filed its petition for Annual Performance

Review of FY 2015-16 & FY 2016-17, Retail supply Tariff for FY 2017-18 and True-up for FY 2011-

-12 & FY 2012-13, according to the Regulations and as per the procedures outlined in Section

61, 62 & 64 of the Electricity Act, 2003, before the Hon’ble Joint Electricity Regulatory

Commission for the State of Goa and Union Territories.

In exercise of the powers conferred under various sections of the Electricity Act, 2003 and all

powers enabling therein, on behalf of the Joint Electricity Regulatory Commission for the State

of Goa and Union Territories, has issued the Tariff Order dated 23rd May, 2017 for

Determination of Tariff for FY 2017-18, Annual Performance Review of FY 2015-16 and FY 2016-

17 & True-up for FY 2011-12 & FY 2012-13 with effective from 1st April 2017 and shall remain

valid till issuance, of further Orders of the Commission, for the Electricity Department,

Government of Goa.

The above is hereby brought to the notice of the general public.

By order and in the name of the Governor of Goa.

N. N. Reddy, Chief Electrical Engineer & ex officio Additional Secretary (Power).

Panaji, 20th June, 2017.

SERIES I No. 11

Panaji, 20th June, 2017 (Jyaistha 30, 1939)

Reg. No. G-2/RNP/GOA/32/2015-2017

RNI No. GOAENG/2002/6410

Suggestions are welcomed on e-mail: dir–[email protected]

493

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Before the

Joint Electricity Regulatory Commission

For the State of Goa and Union Territories, Gurgaon

QUORUM

Shri M.K. Goel (Chairperson)

Smt. Neerja Mathur (Member)

Petition No. 228/2017

In the matter of

Approval for the True-up of the FY 2011-12 & the FY 2012-13, Annual Performance Review

for the FY 2015-16 & FY 2016-17 and Tariff determination proposal for the FY 2017-18.

And in the matter of

Electricity Department, Government of Goa (EDG) ……………………….………………. Petitioner

ORDER

Dated: 23^rdMay, 2017

This Order is passed in respect of the Petition filed by the Electricity Department,

Government of Goa (EDG) for approval for the True-up of the FY 2011-12 & the FY 2012-13,

Annual Performance Review of the FY 2015-16 & FY 2016-17 and Aggregate Revenue

Requirement (ARR) and the Tariff proposal for the FY 2017-18.

After receiving the Petition, the Commission scrutinised its contents and requisitioned

further information/clarifications on the data gaps observed in the Petition to take a

prudent view of the Petition. The Commission also held a Technical Validation Session to

determine its sufficiency. Further, suggestions/comments/objections were invited from the

public/stakeholders. Public Hearing was held and the stakeholders/Public were heard.

The schedule of activities performed in the course of this quasi-judicial process are given

below:

Particulars

Details

Date of Admission

20^thFebruary, 2017

Technical Validation Session

25^thApril, 2017

Public Hearing

27^thApril, 2017

The approved tariff for the FY 2017-18, as detailed in the Chapter “Tariff Schedule,” shall

come into force from 1st April, 2017 and shall remain valid till further Orders of the

Commission.

The licensee shall publish the revised Tariff Schedule and the salient features of tariff

within one week of receipt of the Order in three daily newspapers in the respective local

languages of the region, besides English, having wide circulation in their respective areas

of supply.

OFFICIAL GAZETTE — GOVT. OF GOA

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496

e. Ordered as above, read with attached document giving detailed reasons, grounds and

conditions.

-Sd-

नीरजा माथुर

एम. के. गोयल

(सदस्य)

(अध्यक्ष)

संयुक्त विद्युत विनियामक आयोग

(गोिा और केंद्र शाससत प्रदेशों के सिए)

स्थाि: गुडगााँि

ददिांक: 23 मई 2017py

(Certified Copy)

कीर्ति र्तवारी, सचिव

OFFICIAL GAZETTE — GOVT. OF GOA

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20TH JUNE, 2017

497

Table of Contents

Chapter 1.

Introduction ..................................................................................................................... 503

1.1.

About JERC .................................................................................................................................... 503

1.2.

Electricity Regulatory Process in the Electricity Department, Government of Goa ............... 503

1.3.

Filing and Admission of the Present Petition ............................................................................. 503

1.4.

Interaction with the Petitioner ..................................................................................................... 503

1.5.

Public Hearing process ................................................................................................................. 504

1.6.

Notice for Public Hearing .............................................................................................................. 504

1.7.

Organisation of the Order ............................................................................................................. 505

Chapter 2.

Summary of Suggestions/Objections received, Response from the Petitioner and the

Commission’s Views ................................................................................................................................ 505

2.1.

Regulatory Process ........................................................................................................................ 505

2.2.

Suggestions/Objections, Response of the Petitioner and Commission’s Comments ............ 506

2.2.1. Draft Solar Policy ............................................................................................................................ 506

2.2.2. Plugging of Leakages .................................................................................................................... 506

2.2.3. Inadequate time for filing of comments/suggestions ................................................................ 506

2.2.4. Regarding utilization of Electricity Duty ..................................................................................... 507

2.2.5. Financial Accounting of the Revenue .......................................................................................... 507

2.2.6. Modification in applicability of clause to Hotel Industries. ...................................................... 507

Chapter 3.

True-up for the FY 2011-12 ............................................................................................. 508

3.1.

Applicable provisions of JERC for the State of Goa and Union Territories (Terms and

Conditions for Determination of Tariff) Regulations, 2009 ........................................................ 508

3.2.

Approach for the True-up of the FY 2011-12 ............................................................................... 508

3.3.

Energy sales ................................................................................................................................... 509

3.4.

Power Purchase Quantum and Cost ............................................................................................ 510

3.5.

Renewable Purchase Obligations (RPOs) ................................................................................... 514

3.6.

Intra-State Transmission and Distribution (T&D) losses .......................................................... 514

3.7.

Energy Balance .............................................................................................................................. 515

3.8.

Employee Expenses ...................................................................................................................... 517

3.9.

Administrative and General (A&G) Expenses ........................................................................... 517

3.10.

Repair and Maintenance (R&M) Expenses ................................................................................. 518

3.11.

Gross Fixed Assets (GFA), Capitalisation and Depreciation ................................................... 519

3.12.

Interest and Finance Charges ...................................................................................................... 521

3.13.

Interest on Security Deposit ......................................................................................................... 523

3.14.

Return on Capital Base ................................................................................................................. 524

3.15.

Interest on Working Capital ......................................................................................................... 524

3.16.

Provision for Bad and Doubtful Debts ......................................................................................... 526

3.17.

Non-Tariff Income .......................................................................................................................... 526

3.18.

Revenue from Sale of Surplus Power/Unscheduled Interchange (UI) ...................................... 526

3.19.

Revenue at approved Retail Tariff ............................................................................................... 527

3.20.

Aggregate Revenue Requirement (ARR) .................................................................................... 528

3.21.

Revenue Gap/(Surplus) ................................................................................................................. 529

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Chapter 4.

True-up for the FY 2012-13 ............................................................................................. 529

4.1.

Applicable provisions of JERC for the State of Goa and Union Territories (Terms and

Conditions for Determination of Tariff) Regulations, 2009 ........................................................ 529

4.2.

Approach for the True-up of the FY 2012-13 ............................................................................... 530

4.3.

Energy sales ................................................................................................................................... 531

4.4.

Power Purchase Quantum and Cost ............................................................................................ 532

4.5.

Renewable Purchase Obligations (RPOs) ................................................................................... 535

4.6.

Intra-State Transmission and Distribution (T&D) losses .......................................................... 535

4.7.

Energy Balance .............................................................................................................................. 536

4.8.

Employee Expenses ...................................................................................................................... 538

4.9.

Administrative and General (A&G) Expenses ........................................................................... 538

4.10.

Repair and Maintenance (R&M) Expenses ................................................................................. 539

4.11.

Gross Fixed Assets (GFA), Capitalisation and Depreciation ................................................... 540

4.12.

Interest and Finance Charges ...................................................................................................... 542

4.13.

Interest on Security Deposit ......................................................................................................... 543

4.14.

Return on Capital Base ................................................................................................................. 544

4.15.

Interest on Working Capital ......................................................................................................... 545

4.16.

Provision for Bad and Doubtful Debts ......................................................................................... 546

4.17.

Non-Tariff Income .......................................................................................................................... 546

4.18.

Revenue from Sale of Surplus Power/Unscheduled Interchange (UI) ...................................... 547

4.19.

Revenue at approved Retail Tariff ............................................................................................... 547

4.20.

Aggregate Revenue Requirement (ARR) .................................................................................... 548

4.21.

Revenue Gap/(Surplus) ................................................................................................................. 549

Chapter 5.

True-up of the FY 2013-14, FY 2014-15 and FY 2015-16 ............................................... 550

5.1.

Applicable provisions of JERC for the State of Goa and Union Territories (Terms and

Conditions for Determination of Tariff) Regulations, 2009 ......................................................... 550

5.2.

Approach for the True-up of the FY 2013-14, FY 2014-15 and FY 2015-16 .............................. 550

Chapter 6.

Annual Performance Review of FY 2016-17 ................................................................. 551

6.1.

Applicable provisions of JERC for the State of Goa and Union Territories (except Delhi)

(Multi Year Distribution Tariff) Regulations, 2014 ...................................................................... 551

6.2.

Approach for the Review of the ARR of FY 2016-17 ................................................................... 551

Chapter 7.

Approval of the various ARR components for FY 2017-18 .......................................... 552

7.1.

Approach for the ARR of FY 2017-18 ........................................................................................... 552

7.2.

Annual Revenue Requirement (ARR) .......................................................................................... 552

7.3.

Revenue at existing Retail Tariff of FY 2017-18 .......................................................................... 553

7.4.

ARR, Revenue Deficit/(Surplus) for the FY 2017-18 ................................................................... 554

Chapter 8.

Tariff Principles and Designs ......................................................................................... 555

8.1.

Preamble ......................................................................................................................................... 555

8.2.

Principles of Tariff Design ............................................................................................................. 555

8.3.

Additional Claim ............................................................................................................................ 557

8.4.

Tariff Proposal ................................................................................................................................ 557

8.5.

Revenue Gap/Surplus for the FY 2017-18 ................................................................................... 560

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Chapter 9.

Open Access Charges for FY 2017-18............................................................................. 564

9.1.

Allocation Matrix - Allocation of ARR into Wheeling and Retail Supply of Electricity .......... 564

9.2.

Voltage Wise Wheeling Charges ................................................................................................. 565

9.3.

Cross-Subsidy Surcharge .............................................................................................................. 566

Chapter 10.

Tariff Schedule ................................................................................................................. 567

10.1.

Tariff Schedule ............................................................................................................................... 567

10.2.

Applicability ................................................................................................................................... 568

10.3.

General Conditions of HT and LT Supply ................................................................................... 575

10.4.

Schedule of Miscellaneous Charges ............................................................................................ 578

Chapter 11.

Directives .......................................................................................................................... 581

11.1.

Directives continued in this Order ............................................................................................... 581

11.1.1. Annual Statement of Accounts .................................................................................................... 581

11.1.2. Preparation of Fixed Asset Register ............................................................................................ 582

11.1.3. Energy Audit Reports .................................................................................................................... 583

11.1.4. Employee Cost/Manpower study ................................................................................................ 583

11.1.5. Interest on Consumer Security Deposit....................................................................................... 584

11.1.6. Unbundling of Electricity Department ........................................................................................ 584

11.1.7. Sub Divisions as Strategic Business Units .................................................................................. 585

11.1.8. Installation of Pre Paid Meters ..................................................................................................... 585

11.1.9. Renewable Energy Obligation ..................................................................................................... 586

11.1.10. Management Information System (MIS) and Database Management System (DBMS) ........ 586

11.1.11. Street Lights switching ‘on’ and ‘off’ ......................................................................................... 586

11.1.12. Billing and Collection Efficiency ................................................................................................. 587

11.2.

Directives dropped in this Order .................................................................................................. 587

11.2.1. Creation of separate bank account .............................................................................................. 587

11.2.2. Capital Investment Plan and Monitoring .................................................................................... 588

11.2.3. Arrears of Govt. Departments ...................................................................................................... 588

11.2.4. Create a Central Contracts/tender cell ....................................................................................... 588

11.2.5. Strengthening of Regulatory and Commercial Cell .................................................................... 589

11.2.6. Power Purchase Strategy .............................................................................................................. 589

11.2.7. Submission of Status report on Electric shock-deaths .............................................................. 589

11.2.8. RPO Compliance of Previous years .............................................................................................. 590

11.2.9. Capital Expenditure ...................................................................................................................... 590

Annexure 1: Public Notices published by the Petitioner ..................................................................... 591

Annexure 2: Public Notices published by the Commission for intimation of Public Hearing ......... 592

Annexure 3: List of Stakeholders ........................................................................................................... 593

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List of Tables

Table 1.1: Details of Tariff and related Petitions submitted by the Petitioner so far & Orders issued by

JERC ................................................................................................................................................... 503

Table 1.2: List of interactions with the Petitioner............................................................................................ 504

Table 1.3: Details of Public Notices published by the Petitioner ................................................................... 504

Table 1.4: Details of Public Notices published by the Commission ............................................................... 504

Table 3.1: Energy Sales approved by the Commission in the True-up of the FY 2011-12 (in MU) ............. 509

Table 3.2: Power Purchase quantum (MU) and cost (Rs. crore) submitted by the Petitioner for the

True-up of the FY 2011-12 ................................................................................................................ 510

Table 3.3: Power purchase quantum (in MU) and cost (Rs. crore) approved by the Commission

in the True-up of FY 2011-12 ............................................................................................................ 512

Table 3.4: Summary of Power Purchase approved by the Commission in the True-up of the

FY 2011-12 .......................................................................................................................................... 513

Table 3.5: Intra-State T&D Losses approved by the Commission in the True-up of the FY 2011-12

(MU) .................................................................................................................................................... 514

Table 3.6: Energy Balance for FY 2011-12 as submitted by the Petitioner (MU) .......................................... 515

Table 3.7: Energy Balance approved by the Commission for True-up of the FY 2011-12 (MU) .................. 516

Table 3.8: Employee Expenses approved by the Commission for the True-up of the FY 2011-12

(Rs. crore) ........................................................................................................................................... 517

Table 3.9: A&G Expenses approved by the Commission for the True-up of the FY 2011-12

(Rs. crore) ........................................................................................................................................... 518

Table 3.10: R&M Expenses approved by the Commission for the True-up of the FY 2011-12

(Rs. crore) .......................................................................................................................................... 519

Table 3.11: GFA approved by the Commission in the True-up of FY 2011-12 (Rs. crore) ............................ 520

Table 3.12: Asset-wise depreciation approved by the Commission in the True-up of FY 2011-12

(Rs. crore) .......................................................................................................................................... 521

Table 3.13: Depreciation approved by the Commission in the True-up of FY 2011-12 (Rs. crore) .............. 521

Table 3.14: Normative interest on loan approved by the Commission in the True-up of FY 2011-12

(Rs. crore) ......................................................................................................................................... 523

Table 3.15: Interest on Security Deposit approved by the Commission in the True-up of FY 2011-12

(Rs. crore) ......................................................................................................................................... 523

Table 3.16: Return on Capital Base approved by the Commission in the True-up of FY 2011-12

(Rs. crore) ......................................................................................................................................... 524

Table 3.17: Interest on Working Capital approved by the Commission in the True-up of FY 2011-12

(Rs. crore) ......................................................................................................................................... 525

Table 3.18: Non-Tariff Income approved by the Commission in the True-up of FY 2011-12 (Rs. crore)..... 526

Table 3.19: Revenue from Sale of surplus power approved by the Commission in the True-up of FY

2011-12 (Rs. crore) ........................................................................................................................... 527

Table 3.20: Revenue from Retail Sale power approved by the Commission in the True-up of FY 2011-12

(Rs. crore) ......................................................................................................................................... 527

Table 3.21: Net ARR approved by the Commission in the True-up of FY 2011-12 (Rs. crore) ..................... 528

Table 3.22: Revenue Gap/(Surplus) approved by the Commission in the True-up of the FY 2011-12

(Rs. crore) ......................................................................................................................................... 529

Table 4.1: Energy Sales approved by the Commission in the True-up of the FY 2012-13 (in MU) ............. 531

Table 4.2: Power Purchase quantum (MU) and cost (Rs. crore) submitted by the Petitioner for the

True-up of the FY 2012-13 ................................................................................................................ 532

Table 4.3: Power purchase quantum (in MU) approved by the Commission in the True-up of

FY 2012-13 .......................................................................................................................................... 533

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Table 4.4: Summary of Power Purchase approved by the Commission in the True-up of the

FY 2012-13 .......................................................................................................................................... 535

Table 4.5: Intra-State T&D Losses approved by the Commission in the True-up of the FY 2012-13

(MU) .................................................................................................................................................... 536

Table 4.6: Energy Balance for FY 2012-13 as submitted by the Petitioner (MU) .......................................... 536

Table 4.7: Energy Balance approved by the Commission for True-up of the FY 2012-13 (MU) .................. 537

Table 4.8: Employee Expenses approved by the Commission for the True-up of the FY 2012-13

(Rs. crore) ........................................................................................................................................... 538

Table 4.9: Employee Expenses approved by the Commission for the True-up of FY 2012-13 (Rs. crore) .. 539

Table 4.10: R&M Expenses approved by the Commission for the True-up of the FY 2012-13 (Rs. crore) . 540

Table 4.11: GFA approved by the Commission in the True-up of FY 2012-13 (Rs. crore) ............................ 541

Table 4.12: Asset-wise depreciation approved by the Commission in the True-up of FY 2012-13

(Rs. crore) ......................................................................................................................................... 541

Table 4.13: Depreciation approved by the Commission in the True-up of FY 2012-13 (Rs. crore) .............. 542

Table 4.14: Normative interest on loan approved by the Commission in the True-up of FY 2012-13

(Rs. crore) ......................................................................................................................................... 543

Table 4.15: Interest on Security Deposit approved by the Commission in the True-up of FY 2012-13

(Rs. crore) ......................................................................................................................................... 544

Table 4.16: Return on Capital Base approved by the Commission in the True-up of FY 2012-13

(Rs. crore) ......................................................................................................................................... 544

Table 4.17: Interest on Working Capital approved by the Commission in the True-up of FY 2012-13

(Rs. crore) ......................................................................................................................................... 545

Table 4.18: Non-Tariff Income approved by the Commission in the True-up of FY 2012-13 (Rs. crore)..... 546

Table 4.19: Revenue from Sale of surplus power approved by the Commission in the True-up of FY

2012-13 (Rs. crore) ........................................................................................................................... 547

Table 4.20: Revenue from Retail Sale power approved by the Commission in the True-up of FY 2012-13

(Rs. crore) ......................................................................................................................................... 547

Table 4.21: Net ARR approved by the Commission in the True-up of FY 2012-13 (Rs. crore) ..................... 549

Table 4.22: Revenue Gap/(Surplus) approved by the Commission in the True-up of the FY 2012-13

(Rs. crore) ......................................................................................................................................... 549

Table 7.1 ARR approved by the Commission for FY 2017-18 (In Rs. crore) ................................................. 553

Table 7.2 Revenue from Sale of Power approved by the Commission for the FY 2017-18 (Rs. crore) ....... 553

Table 7.3: Revenue Gap/(Surplus) approved by the Commission for the FY 2017-18 (Rs. crore) ............... 555

Table 8.1: Tariff approved by the Commission for the FY 2017-18 ................................................................ 561

Table 8.2: Revenue at Tariff approved by the Commission for FY 2017-18 ................................................... 562

Table 8.3: Revenue Gap/(Surplus) approved by the Commission for the FY 2017-18 (Rs. crore) ............... 564

Table 9.1: Allocation of ARR between Wheeling and Retail Supply as submitted by the Petitioner

(Rs. crore) ........................................................................................................................................... 564

Table 9.2: Allocation of ARR between Wheeling and Retail Supply as approved by the Commission

(Rs. crore) ........................................................................................................................................... 564

Table 9.3: Determination of input energy for network usage percentage .................................................... 565

Table 9.4: Wheeling Charges approved by the Commission for the FY 2017-18 .......................................... 565

Table 9.5: Calculation of “T”(Tariff payable) approved by the Commission for the FY 2017-18 ................ 566

Table 9.6: Calculation of “C” (W.Avg Cost of Power Purchase) approved by the Commission for the

FY 2017-18 .......................................................................................................................................... 566

Table 9.7: Cross-Subsidy Surcharge approved by the Commission for the FY 2017-18 .............................. 566

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List of Abbreviations

Abbreviation

Full Form

A&G

Administration and General

Act

The Electricity Act, 2003

ARR

Aggregate Revenue Requirement

BNP

Bharat Nirman Programme

CAGR

Compound Annualized Growth Rate

Capex

Capital Expenditure

Current Consumption

CEA

Central Electricity Authority

CERC

Central Electricity Regulatory Commission

CGS

Central Generating Station

COD

Commercial Operation Date

Commission/JERC

Joint Electricity Regulatory Commission for the State of Goa and Union

Territories

Ckt. Km

Circuit Kilometer

DDUGJY

Deendayal Upadhyaya Gram Jyoti Yojana

DISCOM

Electricity Department of Goa

CPSU

Central Public Sector Undertaking

EA 2003

The Electricity Act, 2003

Fixed Charges

FPPCA

Fuel and Power Purchase Cost Adjustment

Financial Year

GFA

Gross Fixed Assets

HEP

Hydro Electric Project

Horse Power

High Tension

IPDS

Integrated Power Development Scheme

JERC

Joint Electricity Regulatory Commission for the State of Goa and Union

Territories

KVA

Kilo Volt Ampere

KWh

Kilo Watt Hour

LPS

Late Payment Surcharge

Low Tension

Million Unit

Mega Watt

MYT

Multi Year Tariff

NDS

Non-Domestic Supply

NFA

Net Fixed Assets

O&M

Operation and Maintenance

PGCIL

Power Grid Corporation of India Ltd.

PLF

Plant Load Factor

Power Exchange

R-APDRP

Restructured Accelerated Power Development and Reforms Programme

REC

Renewable Energy Certificate

RoE

Return on Equity

RPO

Renewable Purchase Obligation

R&M

Repair and Maintenance

SLDC

State Load Dispatch Centre

SBI CAPS

SBI Capital Market Limited

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Abbreviation

Full Form

SBI PLR/SBAR

SBI Prime Lending Rate/State Bank Advance Rate

SCC

System Control Centre

T&D

Transmission and Distribution

Unscheduled Interchange

Variable Charges

Chapter 1. Introduction

1.1. About JERC

In exercise of the powers conferred by Section 83 of the Electricity Act, 2003, the Central

Government constituted a two member (including Chairperson) Joint Electricity

Regulatory Commission for all Union Territories except Delhi to be known as “Joint

Electricity Regulatory Commission for Union Territories” with headquarters at Delhi as

notified vide notification No. 23/52/2003–R&R dated 02^ndMay, 2005. Later, with the joining

of the State of Goa, the Commission came to be known as “Joint Electricity Regulatory

Commission for the State of Goa and Union Territories” as notified on 30^thMay, 2008. The

Joint Electricity Regulatory Commission for the State of Goa and Union Territories

(Andaman & Nicobar Islands, Chandigarh, Dadra and Nagar Haveli, Daman & Diu,

Lakshadweep and Puducherry) started functioning with effect from September, 2008. The

office of the Commission is located in Gurgaon, Haryana.

1.2. Electricity Regulatory Process in the Electricity Department, Government of Goa

In earlier years, the Electricity Department, Government of Goa (EDG) had submitted the

Tariff and Business Plan Petitions on which the Commission had subsequently issued the

following Orders:

Table 1.1: Details of Tariff and related Petitions submitted by the Petitioner so far &

Orders issued by JERC

Sr.

No.

Date of Filing

Date of Tariff Order

2011-12

19^thOctober, 2011

27^thJune, 2012

2012-13

31^stDecember, 2011

27^thJune, 2012

2013-14

31^stJanuary, 2013

31^stMarch, 2013

2014-15

07^thJanuary, 2014

15^thApril, 2014

2015-16

14^thJanuary, 2015

06^thApril, 2015

Business Plan for

1^st MYT Control Period

30^th September, 2015/

/06^th October, 2015

22^nd December, 2015

MYT Order for 1^st MYT

Control Period

18^th February, 2016

18^th April, 2016

1.3. Filing and Admission of the Present Petition

The present Petition was filed by EDG vide letter dated 27^th December, 2016 which was

received at the Commission’s office on 04^th January, 2017. The Petition completed in all

respects was admitted on 11^th January, 2017 and numbered as Petition No. 228/2017.

1.4. Interaction with the Petitioner

The Order has referred at numerous places to various actions taken by the “Commission.”

It may be mentioned for the sake of clarity that the term “Commission,” except for the

hearing and Orders, denotes the Secretariat of the Commission responsible for carrying out

the technical due diligence and validation of data of the Petitions filed by the Electricity

Department, Government of Goa (EDG), obtaining and analysing information/clarifications

received from the Electricity Department, Government of Goa (EDG), and submitting

relevant issues for consideration of the Commission.

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The Commission’s staff interacted regularly with the Petitioner to seek clarifications and

justifications on various issues essential for analysis of the Tariff Petition, and conducted a

Technical Validation Session (TVS) with the Petitioner during which discrepancies in the

Tariff Petition were pointed out and additional information sought by the Commission was

informed. Relevant dates, including dates of correspondence and interaction with the

Petitioner are as follows:

Table 1.2: List of interactions with the Petitioner

S .No.

Date

Subject

30^th January, 2017

Data Gaps sought by the Commission

02^nd March, 2017

Reply to Data Gaps furnished by the Petitioner

25^thApril, 2017

Technical Validation Session

08^thMay, 2017

Additional Replies to Data Gaps furnished by the Petitioner

1.5. Public Hearing process

The Commission had noted that in view of the State Assembly Elections 2017, the Model

Code of Conduct was imposed in Goa on 04^thJanuary, 2017 following the announcement of

the elections for 40 assembly constituencies of legislative assembly.The elections were

held on 04^thFebruary, 2017, while the results were declared on 11^thMarch, 2017.

After the end of Model Code of Conduct, the Commission initiated the proceedings and

directed the Petitioner to publish a Summary of the Tariff Petition in an abridged form to

ensure meaningful public participation. Public Notices were published by the Petitioner for

inviting suggestions/objections from the stakeholders on the Tariff Petition as follows:

Table 1.3: Details of Public Notices published by the Petitioner

Sr.

No.

Date

Name of newspaper

Place of circulation

28^th March, 2017

Gomantak

Goa

28^th March, 2017

Tarun Bharat

Goa

28^th March, 2017

Times of India

Goa

The Petitioner also uploaded the Petition on its website https://www.goaelectricity.gov.in/

and invited objections and suggestions on the Petition. Interested parties/stakeholders

were requested to file their suggestions/objections on the Petition to the Commission with

a copy to the Petitioner on or before 27^th April, 2017. Copies of the public notices published

by the Petitioner are attached as Annexure 1 to this Order. The Commission received

many suggestions on the Petition, on which the department responded in writing to the

stakeholders, with a copy to the Commission.

1.6. Notice for Public Hearing

The Commission also published Public Notices in the leading newspapers a stabled below,

giving due intimation to the stakeholders, consumers and the public at large about the

Public Hearing to be conducted by the Commission on 27^th April, 2017 from 10 AM onwards

at the Nalanda Hall, 5^th Floor, EDC House, Atmaram Borkar Road, Panaji, Goa, 403001:

Table 1.4: Details of Public Notices published by the Commission

S. No.

Date

Name of Newspaper

Place of Circulation

04^th April, 2017

O-HERALDO

Goa

THE NAVHIND TIMES

GOMANTAK

25^th April, 2017

O-HERALDO

THE NAVHIND TIMES

GOMANTAK

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Copies of the Public Notices published by the Commission for intimation of the Public

Hearing are attached as Annexure 2 to this Order. This notice was uploaded on

Commission’s website also.

The major issues raised/indicated during the Public Hearing, along with comments/replies

of the utility and views of the Commission thereon, have been summarised in Chapter 2 of

this Order. The Commission has taken into consideration all the suggestions and

comments raised on the Petition.

1.7. Organisation of the Order

This Order is organised into the following chapters:

 Chapter 1: Background and brief description of the regulatory process undertaken by

the Commission.

 Chapter 2: Various suggestions and objections raised by the Stakeholders in writing,

as well as during the Public Hearing before the Commission.

 Chapter 3: True-up for the FY 2011-12.

 Chapter 4: True-up for the FY 2012-13.

 Chapter 5: True-up for the FY 2013-14, FY 2014-15 and FY 2015-16

 Chapter 6: Annual Performance Review of the FY 2016-17

 Chapter 7: Approval of various Aggregate Revenue Requirement (ARR) components for

the FY 2017-18.

 Chapter 8: Approach of the Commission on tariff principles and design.

 Chapter 9: Open Access Charges for the FY 2017-18.

 Chapter 10: Tariff schedule of the FY 2017-18 and Schedule of Services and Charges

approved by the Commission

 Chapter 11: Directives of the Commission to Electricity Department, Government of

Goa.

Chapter 2. Summary of Suggestions/Objections received, Response from the Petitioner and

the Commission’s Views

2.1. Regulatory Process

On admitting the Petition, the Commission directed the Petitioner to make copies of the

Petition available to the public, upload the Petition on the website and also publish the

same in the newspapers in an abridged form in the given format duly inviting

comments/objections from the public as per the provisions of the JERC (Terms and

Conditions for Determination of Tariff) Regulations, 2009 (hereinafter referred to as the

Tariff Regulations, 2009) and JERC (Multiyear Distribution Tariff) Regulations, 2014

(hereinafter referred to as the MYT Regulations, 2014) as amended from time to time.

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The Public Hearing was held on 27^th April, 2017 at Panaji, Goa. During the Public Hearing,

some of the stakeholders who had submitted their comments in writing also presented

their views in person before the Commission. Other participants from the general public,

who had not submitted written objections earlier, were also given an equal opportunity to

present their views/suggestions in respect of the Petition.

The list of the Stakeholders is attached as Annexure 3 to this Order.

2.2. Suggestions/Objections, Response of the Petitioner and Commission’s Comments

The Commission is appreciative of the efforts of various stakeholders in providing their

suggestions/comments/observations to make the Electricity Distribution Sector responsive

and efficient. The Commission has noted the concerns of all stakeholders and has tried to

address them to the extent possible in the tariff design and directive chapters. The

submissions of the Stakeholders, response of the Petitioner and views of the Commission

are summarized below:

2.2.1. Draft Solar Policy

Stakeholder’s Comment:

The draft policy was notified in 2014 and was expected to be finalized shortly. However,

there is no mention of the same in the proposed Tariff Structure for the FY 2017-18.

Petitioner’s Response:

The Petitioner has not submitted any response.

Commission’s View:

The Commission would like to inform that presently the impact of Solar Tariff in respect of

the renewable purchases is already factored in while computing the total Power Purchase

Cost of the EDG. Further, the impact of tariff of various solar installations based on the

Solar Policy within the State of Goa shall be considered once the Policy is finalized and

notified in the Official Gazette.

2.2.2. Plugging of Leakages

Stakeholder’s Comment:

Lights are on in government offices even during the daytime leading to wastage of

power.

Petitioner’s Response:

The Petitioner clarified verbally during the hearing that officers and staff of various

government offices are being briefed regularly for conservation of electricity.

Commission’s View:

The Commission notes the submission of the Petitioner and advises it to regularly issue

appropriate circulars to various departments/offices to make them aware about the

benefits of conservation of electricity.

2.2.3. Inadequate time for filing of comments/suggestions

Stakeholder’s Comment:

There were 4 public holidays in the 11 days timeframe given for submission of

comments/objections/suggestions. Thus the remaining time was inadequate and the

Commission is requested to take note of this.

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Petitioner’s Response:

The Petitioner verbally clarified at the time of Public Hearing that the notices were issued

as per the provisions of the Conduct of Business Regulations framed by JERC

Commission’s View:

The Commission notes the concern of the Stakeholders. The Commission directs the

Petitioner to ensure that adequate time is given to the Stakeholders to submit their

comments with due consideration of intervening holidays next time onwards. Further, the

Commission always follows a transparent and participative approach and hence has been

accepting the comments/suggestions of the Stakeholders till the time of the hearing.

2.2.4. Regarding utilization of Electricity Duty

Stakeholder’s Comment:

While the tourism industry is paying the highest rate of Electricity Duty, the department

in return is not giving attention to the development of infrastructure to meet the tourism

industry requirements.

Petitioner’s Response:

The Petitioner has not submitted any response.

Commission’s View:

The Commission would like to highlight that levy of Electricity Duty and its usage is

strictly under the purview of the Government. However, various schemes for

augmentation of infrastructure are underway. The stakeholder is advised to take up its

specific concern related to infrastructure/services directly with the department under

intimation to the Commission.

2.2.5. Financial Accounting of the Revenue

Stakeholder’s Comment:

There are issues of proper accounting of the revenue as highlighted by the Petitioner.

Petitioner’s Response:

The Petitioner clarified verbally at the time of the Hearing that there were issues in the

billing in the FY 2015-16 which have now been addressed.

Commission’s View:

The Commission has noted the submissions of the Petitioner and directs the Petitioner to

make appropriate arrangements so that such issues do not occur in future.

2.2.6. Modification in applicability of clause to Hotel Industries.

Stakeholder’s Comment:

The last sentence of the proposal may be deleted i.e.

The Tariff under this category will be applicable only from prospective basis i.e. from the

succeeding month of receipt of certificate and no retrospective effect to be provided.

And should be replaced with the following:

The concessional tariff will be applicable for the month of receipt of certificate or the

following month.

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Petitioner’s Response:

The Petitioner has not submitted any response.

Commission’s View:

The Commission has dealt with this issue in Chapter 8. “Tariff Principles and Design”.

Chapter 3. True-up for the FY 2011-12

3.1. Applicable provisions of JERC for the State of Goa and Union Territories (Terms and

Conditions for Determination of Tariff) Regulations, 2009

The True-up of the previous years is to be carried out as per Regulation 8 (2) of the JERC

for the State of Goa and Union Territories (Terms and Conditions for Determination of

Tariff) Regulations, 2009 hereinreferred to as Tariff Regulations, 2009:

“(2) (i) After audited accounts of a year are made available, the Commission shall undertake

similar exercise as above with reference to the final actual figures as per the audited

accounts. This exercise with reference to audited accounts shall be called ‘Truing Up’.

(ii) The Truing Up for any year will ordinarily not be considered after more than one

year of ‘Review’.

(3) The revenue gap of the ensuing year shall be adjusted as a result of review and

truing up exercises.

(4) While approving such expenses/revenues to be adjusted in the future years as

arising out of the Review and/or Truing up exercises, the Commission may allow the

carrying costs as determined by the Commission of such expenses/revenues. Carrying costs

shall be limited to the interest rate approved for working capital borrowings.

(5) For any revision in approvals, the licensee would be required to satisfy the

Commission that the revision is necessary due to conditions beyond its control.

(6) In case additional supply is required to be made to any particular category, the

licensee may, any time during the year make an application to the Commission for its

approval. The application will demonstrate the need for such change of consumer mix and

additional supply of power and also indicate the manner in which the licensee proposes to

meet the cost for such change of consumer mix and additional supply of power.

(7) The Commission may consider granting approval to such proposals provided the

cost of additional supply is ordinarily met by the beneficiary category.”

3.2. Approach for the True-up of the FY 2011-12

While the Petitioner has submitted the True-up for the FY 2011-12 along with the audited

accounts, it has been observed that the Petitioner has not submitted certain information

(even in the response to data gaps sought by the Commission) that is required to

undertake a proper True-up.

The Commission has adopted the following approach which is in conformity with the Tariff

Regulations, 2009 for the True-up of ARR for the FY 2011-12:

1. The Commission has considered energy availability at the periphery of the Petitioner’s

territory and UI sale/UI purchase from Unscheduled Interchange (UI) Accounts

maintained by Southern Regional Power Committee (SRPC) and Western Regional

Power Committee (WRPC) in this regard.

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2. The total power purchase cost of the Petitioner for the True-up period has been taken

from the audited accounts of the Petitioner.

3. The Commission has adjusted the security deposit as available with the Petitioner at

the end of the financial year from the Working Capital requirements of the financial

year for subsequent calculation of the Interest on Working Capital.

4. In the True-up years, the Commission has considered the bad and doubtful debts

actually written-off as an expense and is not allowing any provision for bad debts.

For the issues in regards to the True-up other than listed above, the Commission

has adopted treatment on basis of Tariff Regulations, 2009.

The Commission had determined the ARR for the FY 2011-12 vide its Order dated

27th June, 2012.

In this Chapter, the Commission has analysed all the elements of actual revenue

and expenses for the FY 2011-12 and has carried out the True-up of expenses and

revenue with reference to the actual figures (final) as per the audited accounts, after a

prudence check and has permitted necessary adjustments in cases where variations

are for reasonable and justifiable reasons.

3.3. Energy sales

Petitioner’s submission:

The actual energy sales for the FY 2011-12 were 2,880.11 MU, as against 2,746.40MU

approved earlier by the Commission vide Tariff Order dated 27^th June, 2012.

Commission’s analysis:

The Commission, after going through the submissions of the Petitioner including the

audited accounts, has considered the energy sales at 2,880.11 MU as submitted by the

Petitioner for the purpose of True-up of the FY 2011-12 as shown in the following Table:

Table 3.1: Energy Sales approved by the Commission in the True-up

of the FY 2011-12 (in MU)

No.

Particulars

FY 2011-12

Approved in Tariff

Order dated

27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

A. LOW TENSION SUPPLY

1,148.00

1,150.82

(a) LTD/Domestic

696.00

751.96

(b) LTD/L.I.G.

4.00

7.87

2.00

3.23

LTC/Commercial

305.00

249.14

(a) LTP/Motive Power

92.00

78.33

(b) LTP Mixed (Hotel Industries)

6.00

6.10

0.00

6.84

LTAG/Agriculture

10.00

14.12

LTPL ( Public lighting )

31.00

30.50

LTPWW/Public Water works

2.00

2.71

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B. HIGH TENSION SUPPLY

1,584.40

1,710.90

HT ( Mixed )

145.00

128.81

HTI (Industrial) Ferro Metallurgical/

Steel Melting/Power Intensive.

480.00

461.41

HTI Industrial

577.00

643.06

HTAG ( Agriculture)

4.00

7.49

EHTI ( Industrial )

168.70

170.52

HT P.W.W. & Sewage system

117.00

138.75

HT. M.E.'s Defense Estt.

40.00

24.73

HTI ( Steel Rolling )

46.70

120.74

HTI / IT High Tech

5.00

6.23

HTI/Ice Manufacturing

1.00

0.40

Sale from EDG to GSPL (Div. VII)

8.74

HTI Hotel Industry

0.00

C. TEMPORARY SUPPLY

14.00

18.39

(a) L.T. Temporary

14.00

17.93

(b) H.T. Temporary

0.00

0.46

Total

2,746.40

2,880.11

Therefore, the Commission approves the total sales of 2,880.11 MU in the True-up of FY 2011-12.

3.4. Power Purchase Quantum and Cost

Petitioner’s submission:

An amount of Rs. 1,125.10 crore has been incurred for the procurement of 3811.77 MU of

power in the FY 2011-12 as against the total power purchase cost of Rs. 1,060.47 crore

approved by the Commission for the purchase of 3740.19 MU of power in the FY 2011-12

in its Order dated 27^th June, 2012.

The source-wise actual power purchase quantum and cost for FY 2011-12 is summarized

in Table below:

Table 3.2: Power Purchase quantum (MU) and cost (Rs. crore) submitted by the Petitioner

for the True-up of the FY 2011-12

Sr.

No.

Source

Purchase

(MU)

Power Purchase Cost (Rs crore)

Fixed

Variable

Others

Suppl.

Total

Central Sector Power Stations

NTPC

3,207.25

168.02

350.40

97.58

19.02

635.02

KSTPS

1,524.46

61.06

109.76

37.75

(3.40)

205.17

VSTPS - I

293.43

14.95

38.34

10.59

3.66

67.54

VSTPS - II

108.76

7.05

13.22

4.34

0.92

25.53

VSTPS -III

100.32

9.59

13.18

3.09

1.48

27.35

VSTPS-IV

KGPP

96.32

7.61

25.20

9.69

2.74

45.24

GGPP

SIPAT- I

31.29

3.47

2.08

0.06

0.10

5.71

FSTPS

0.08

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KSTPS-III

33.47

5.51

2.62

0.09

(0.13)

8.09

TSTPS

0.01

KHSTPS-I

0.02

RSTPS

831.01

38.21

112.44

23.47

6.06

180.18

SIPAT- II

94.38

10.45

9.08

1.00

5.22

25.75

Mouda

JGPS

93.82

10.09

24.48

7.52

2.27

44.36

RGPPL

III

NPCIL

213.60

54.74

KAPS

130.53

30.30

TAPS

83.08

24.44

Traders

315.21

121.08

NVVN Limited

315.21

121.08

OVER/ UNDER

DRAWAL

(166.61)

29.64

Within State Generations

CO- GENERATION

128.14

30.82

Goa Energy Private

Limited

113.82

27.38

Goa Sponge & Power

Limited

14.32

3.44

IPP:

Reliance Infra

114.17

153.06

OTHER CHARGES

100.74

PGCIL Transmission

Charges, Wheeling &

Other Charges

100.74

Total

3,811.77

168.02

739.74

97.58

19.02

1,125.10

Commission’s Analysis:

The Commission has verified the power purchase details as submitted by the Petitioner in its

Petition with the publicly available information from the Regional Energy Accounts (REA)

maintained

Western

Region

Power

Committee

(WRPC)

their

website

(http://www.wrpc.gov.in/) for the Central Generating Stations (CGS). Further, apart from

western region, the Petitioner also gets supply from the southern region from the NTPC’s

Ramagundam Thermal Power Station. The Commission has validated the power purchase

details pertaining to this station from the publicly available information from the Regional

Energy Accounts (REA) maintained by Southern Region Power Committee (SRPC) on their

website (http://www.srpc.kar.nic.in/).

The Commission observes that there is huge variation of 374.02 MU in information as

submitted by the Petitioner and as available in the REA for FY 2011-12 towards the purchase

from CGS (except UI).

To cross check this anomaly, the Commission sought power purchase bills from the

Petitioner. However, the Petitioner responded as follows:

“ED-Goa submits that the compilation data for two years as per Format 4 is an enormous task

to be carried out and will also be a time consuming process. It will be difficult to compile the

data in Format 4 within such short time.

However, the actual Monthly Power Purchase summary for NTPC, NPCIL, Co-generations,

NVVNL, PGCIL-WR, PGCIL-SR, KPTCL Wheeling charges for FY 2011-12 on accrual basis were

provided to the Hon’ble Commission during the tariff determination process of FY 2012-13 and

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FY 2013-14 vide petition No. 40/2011, 70/2012 and 99/2013. It is requested to the Hon’ble

Commission to refer to the data submission made during the tariff proceeding during those years

for further analysis”.

The Commission further notes that in the Tariff Order dated 27^th June, 2012, the Commission

had considered the quantum of power purchase from NTPC and NPCIL for the FY 2011-12

based on the bills made available at that point of time by the Petitioner and provisional/final

REA available in the WRPC/SRPC websites at that point of time.

The summary of the power purchase quantum from NTPC and NPCIL stations for the FY

2011-12 as approved in the Order dated 27^th June, 2012, the current submission by the

Petitioner and information as now available in the REA is submitted below:

FY 2011-12

Source

Approved by the

Commission in Order dated

27/06/2012

Petitioner’s Submission

in current Petition

Information now verified

from REA

NTPC (in MU)

2,932.80

3,207.26

2,851.28

NPCIL (in MU)

195.83

213.61

195.56

The Commission would like to highlight that the Petitioner has not provided a copy of the

bills matching with the audited accounts to validate its claim. As the alternate source for

validation of claim of quantum of power purchase for FY 2011-12 is not made available by the

Petitioner, the Commission finds it appropriate to consider the information now verified from

REA for the purpose of True-up of the FY 2011-12 as it is in almost in the same range as

approved in the Order dated 27^th June, 2012.

Also, the Commission notes that the Petitioner has done netting off of the UI over-drawal and

UI under-drawal in its submission. The Commission, as a part of the prudence check, has

considered the over-drawal and under-drawal separately from the Unscheduled Interchange

(UI) accounts maintained by WRPC as well as SRPC.

Further, the Commission has also verified the power purchase cost as submitted by the

Petitioner with the amount reflecting in the audited accounts of the FY 2011-12. Hence the

Commission approves the power purchase cost as submitted by the Petitioner.

Accordingly the Commission approves the following power purchase cost and quantum for

the FY 2011-12 in the following Table:

Table 3.3: Power purchase quantum (in MU) and cost (Rs. crore) approved by the Commission in the

True-up of FY 2011-12

Sr.

No.

Source

Energy (MU)

Power Purchase Cost (Rs crore)

True Up

Submission

True Up

Order

Difference

Fixed

Variable

Others

Suppl.

Total

Central Sector Power Stations

NTPC

3,207.26

2,851.28

-355.98

168.02

350.40

97.58

19.02

635.02

KSTPS

1,524.46

1,301.08

-223.38

61.06

109.76

37.75

-3.40

205.17

VSTPS - I

293.43

252.02

-41.41

14.95

38.34

10.59

3.66

67.54

VSTPS - II

108.76

97.31

-11.45

7.05

13.22

4.34

0.92

25.53

VSTPS -III

100.32

92.57

-7.75

9.59

13.18

3.09

1.48

27.35

KGPP

96.32

96.16

-0.16

7.61

25.20

9.69

2.74

45.24

SIPAT- I

31.29

23.70

-7.59

3.47

2.08

0.06

0.10

5.71

FSTPS

0.08

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KSTPS-III

33.47

32.86

-0.61

5.51

2.62

0.09

-0.13

8.09

TSTPS

0.01

KHSTPS-I

0.02

RSTPS

831.01

768.66

-62.35

38.21

112.44

23.47

6.06

180.18

SIPAT- II

94.38

94.14

-0.24

10.45

9.08

1.00

5.22

25.75

JGPS

93.82

92.79

-1.03

10.09

24.48

7.52

2.27

44.36

RGPPL

III

NPCIL

213.61

195.56

-18.05

54.74

KAPS

130.53

120.29

-10.24

30.30

TAPS

83.08

75.28

-7.80

24.44

24.44

Traders

315.21

121.08

NVVN Limited

315.21

121.08

OVER/

UNDER

DRAWAL

-166.61

52.11

218.72

29.64

Within State Generations

CO-

GENERATION

128.14

30.82

Goa Energy

Private

Limited

113.82

27.38

Goa Sponge &

Power Limited

14.32

3.44

IPP:

Reliance Infra

114.17

153.06

OTHER

CHARGES

100.74

PGCIL

Transmission

Charges,

Wheeling &

Other Charges

100.74

Total

3,811.78

3,656.48

-155.30

168.02

739.74

97.58

19.02

1,125.10

The Commission observes that the Power Purchase cost of Rs. 1,125.10 crore as claimed by

the Petitioner is the same as reflected in the audited accounts for the FY 2011-12.

The total power purchase quantum and cost as submitted by the Petitioner and approved by

the Commission is tabulated hereunder:

Table 3.4: Summary of Power Purchase approved by the Commission in the True-up

of the FY 2011-12

Particulars

Approved in Tariff

Order dated 27-06-2012

Petitioner's Submission

(True-up)

Approved by the

Commission

(True-up)

Power Purchase Quantum (MU)

3740.19

3811.78

3656.48

Power Purchase Cost (Rs. crore)

1060.47

1125.10

Average Per Unit Cost (Rs./kWh)

2.84

2.95

3.08

Therefore, the Commission approves the overall power purchase quantum of 3656.48 MU

at the cost of Rs. 1125.10 crore in the True-up of the FY 2011-12.

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3.5. Renewable Purchase Obligations (RPOs)

As per Clause 1, Sub-clause (1) of the JERC for the State of Goa and UTs (Procurement of

Renewable Energy) Regulations, 2010

“Each distribution licensee shall purchase electricity (in kWh) from renewable energy

sources, at a defined minimum percentage of the total consumption of all the consumers in

its area during a year.”

The Commission, in its Business Plan Order dated 22^nd December, 2015 issued in the

Petition No. 186/2015, has reiterated that all the pending RPO’s upto the FY 2015-16

must be fulfilled by the Petitioner by 31^st March, 2016 and no backlog would be allowed

to carried forward to the MYT Control Period from FY 2016-17 to FY 2018-19.

The Petitioner has not submitted any information towards RPO compliance in the Petition.

Further, in response to data gaps, the Petitioner has submitted that the RPO backlog has

been fully eliminated in the FY 2015-16. The Petitioner also provided copy of the affidavit

as submitted in the Petition No. 175/2015 in this context.

Keeping in view the above, the Commission has not considered any incentive/penalty

towards RPO compliance in the FY 2011-12 and shall consider the same at the time of

True-up of the FY 2015-16.

3.6. Intra-State Transmission and Distribution (T&D) losses

Petitioner’s Submission:

Intra State T&D Losses and Inter State Losses have been claimed at 16.21% and 4.83%

respectively for the FY 2011-12 as against 13.48% and 4.31% approved by the Commission.

Further, the accounting in the FY 2011-12 has witnessed a transitional change from cash to

accrual method which resulted into change in energy accounting with regards to billing

also. Also, Tariff Policy, 2006 allows a suitable transition framework to be provided for the

licensees by SERC to reach the desired levels of service as quickly as possible. Therefore,

the Commission is requested to approve the said T&D Losses due to such change in the

transition period.

Commission’s Analysis:

The Commission has analyzed the actual Intra-State T&D losses based on the drawal

schedule as available on the WRPC and SRPC websites. The actual drawal at the periphery

of Goa has been considered from the weekly UI sheets for the year as available on the

WRPC and SRPC websites as shown in the Table below:

Particulars

FY 2011-12

Actual Drawal at Western Region Periphery(Source: WRPC)

2328.98

Actual Drawal at Southern Region Periphery(Source: SRPC)

609.59

Total

2938.57

Further, the sales allowed for the FY 2011-12 i.e. 2,880.11MU has been considered, to arrive

at the actual Intra-State T&D loss of 9.46% for the utility as tabulated below:

Table 3.5: Intra-State T&D Losses approved by the Commission in the True-up

of the FY 2011-12 (MU)

Particulars

Approved in

Tariff Order

dated

27-06-2012

Petitioner's

submission

(True-up)

Approved by the

Commission

(True-up)

Net energy drawn at State periphery (MU)

2,935.20

3,194.88

2,938.57

Net energy available from sources within

the State (Cogen + IPP) (MU)

239.12

242.31

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Total Energy available at State periphery

for sale to Retail Consumers (MU)

c=a+b

3,174.32

3,437.19

3,180.88

Energy sales within the State (MU)

2,746.40

2,880.11

T&D Losses (MU)

e=c-d

427.92

557.08

300.77

T&D Losses (%)

f=e/c

13.48%

16.21%

9.46%

The Commission, therefore, considers the actual Intra-State T&D loss of 9.46%f or the

True-up of the FY 2011-12.

Further, the Commission accepts the submission of the Petitioner that the accounting in the

FY 2011-12 has witnessed a transitional change from cash to accrual method which resulted

into change in energy accounting with regards to billing also. As the Petitioner has prepared

and submitted accounts based on commercial principles for the 1^st time for the FY 2011-12, the

Commission has decided not to consider any incentive/penalty for the over achievement/

/under achievement of T&D Losses in the FY 2011-12 keeping in view the transition period

required for such change.

3.7. Energy Balance

Petitioner Submission

The energy balance for the FY 2011-12 is tabulated below:

Table 3.6: Energy Balance for FY 2011-12 as submitted by the Petitioner (MU)

Sr.

No.

Item

FY 2011-12

Audited (MU)

Energy Input at Goa Periphery

3,195

Total Power Scheduled/ Purchased at Goa Periphery

Total Schedule Billed Drawal - CGS (MU)

3,421

Add: Overdrawal / purchase from Traders (MU)

Add: Power purchase from NVVN (MU)

315

Less: Under-drawal (MU)

167

Less: Power diverted to Exchange (MU)

189

Less: Banking Power (MU)

Total (MU)

3,357

PGCIL Losses - MU

162

PGCIL Losses - % *

4.83%

Total Power Purchased within Goa State

Add: Co-generation (MU)

128

Add: Independent Power Producers (IPP) (MU)

114

Total (MU)

242

Total Power Purchase availability after PGCIL Losses (MU)

3,437

Less: Retail Sales to Consumers (MU)

2,880

Distribution Losses - MUs

557

Distribution Losses - %

16.21%

Commission’s analysis:

As detailed in previous sections, the Commission has examined the REA and weekly UI

accounts for the FY 2011-12 as available in the public domain on the websites of SRPC and

WRPC for validating the energy purchased by the Petitioner from the power plants/

/traders/ exchange/ banking arrangement/UI mechanism.

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Accordingly, the Energy Balance as considered by the Commission for the True-up of the

FY 2011-12 is shown in Table below:

Table 3.7: Energy Balance approved by the Commission for True-up of the FY 2011-12 (MU)

Particulars

Formulae

Approved in Tariff

Order dated

27-06-2012

Petitioner's

submission

(True-up)

Approved by

the

Commission

(True-up)

ENERGY REQUIREMENT

Energy sales within the State (MU)

2,746.40

2,880.11

T&D Losses within the State (%)

13.48%

16.21%

9.46%

T&D Losses within the State (MU)

c=d-a

427.92

557.08

300.77

Total Energy required at State periphery

for sale to Retail Consumers (MU)

d=1/(1-b)

3,174.32

3,437.19

3,180.88

Less: Power purchase from sources

within the State (MU)

239.12

242.31

Total Energy required at State

periphery from Sources located outside

the State (MU)

f=d-e

2,935.20

3,194.88

2,938.57

Energy Transactions at Periphery

Add: Sales in Power Exchanges (MU)

188.89

182.50

Add: Sales in UI (MU)

210.45

166.61

205.05

Add: Sales under Banking Arrangement

(MU)

23.61

0.00

Less: Purchase under UI (MU)

57.23

0.00

52.11

Less: Purchase from Traders (MU)

315.21

Total energy scheduled at State

Periphery from Tied-up Sources (MU)

l=f+g+h

+i-j-k

2,985.71

3,258.77

2,958.81

Interstate Losses (%)

4.57%

4.74%

2.89%

Interstate Losses (MU)

142.92

162.09

88.04

Total requirement from Tied-up

sources at generator end (MU)

o=l+n

3,128.63

3,420.86

3,046.85

Total requirement from Tied-up

sources at generator end & UI/Traders/

/Banking/within State (MU)

p=o+e+j

3,740.19

3,811.78

3,656.48

ENERGY AVAILABILITY

NTPC (MU)

2,932.80

3,207.26

2,851.28

RGPPL (MU)

0.00

NPCIL (MU)

195.83

213.61

195.56

Traders (MU)

315.21

OVER/UNDER DRAWAL (MU)

57.23

-166.61

52.11

Generation within the State (MU)

239.12

242.31

Total Availability from Tied-up sources

at generator end & UI/Traders/Sources

within State (MU)

w=q+r+s

+t+u+v

3,740.19

3,811.78

3,656.48

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3.8. Employee Expenses

Petitioner’s Submission:

Employee expenses for the FY 2011-12 are based on the actual employee expenses incurred

during the entire year.

The employee cost as approved by the Commission in the FY 2010-11 was Rs. 123.51 crore

whereas the actual expenditure for the FY 2011-12 was Rs. 155.04 crore, resulting in

increase of 26%. The WPI for FY 2011-12 was ~8.93% against which the escalation in the

cost is ~15%. Also, the audited employee cost for the FY 2010-11 is Rs. 149 crore which

means the resultant increase on YoY basis is only ~3%. Employee cost has increased due to

the impact of WPI and the accrual basis of accounting methodology adopted in the said

year.

Commission’s Analysis:

The Commission observes that the employee expenses approved in the past were based on

the estimates prepared on cash basis and not accrual basis. The Petitioner has prepared

and submitted the audited accounts prepared on commercial principles for the first time.

Accordingly, the Commission finds it appropriate to consider the actual employee costs as

available in the audited accounts for the purpose of True-up of the FY 2011-12 as shown in

the following Table:

Table 3.8: Employee Expenses approved by the Commission for the True-up of the

FY 2011-12 (Rs. crore)

Sr.

No.

Particulars

FY 2011-12

Approved in Tariff

Order dated

27-06-2012

Petitioner’s Submission

(True-up)

Approved by the

Commission

(True-up)

Salaries & Allowances

112.44

155.04

137.35

Pension Contribution and

Terminal Benefits

6.44

6.55

Other Salary payments

7.01

11.15

Gross Total

125.89

155.04

Therefore, the Commission approves actual employee expenses of Rs. 155.04 crore and

for the True-up of the FY 2011-12.

3.9. Administrative and General (A&G) Expenses

Petitioner’s Submission:

In the Tariff Order dated 27^thJune, 2012 and APR order dated 31^st March, 2013, the Commission

had approved the A&G expenses of Rs. 19.31 crore for the FY 2011-12.

Commission’s Analysis:

The Commission observes that the A&G expenses approved in the past were based on the

estimates prepared on cash basis and not accrual basis. The Petitioner has prepared and

submitted the audited accounts prepared on commercial principles for the first time.

Accordingly, the Commission finds it appropriate to consider the actual A&G expenses as

available in the audited accounts for the purpose of True-up of the FY 2011-12. However,

the Commission would like to highlight that the Petitioner has considered an expense of

Rs. 2 crore under the sub-head “Energy Conservation Expense” in the R&M Expenses in FY

2011-12. The Commission is of the view that this expense is of the nature of A&G Expense

and not R&M Expenses and has accordingly considered this expense of Rs. 2 crore as part

of A&G expenses for the True-up of the FY 2011-12.

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The A&G Expenses as submitted by the Petitioner and approved by the Commission are

shown in the Table below:

Table 3.9: A&G Expenses approved by the Commission for the True-up of the FY 2011-12

(Rs. crore)

No.

Particulars

FY 2011-12

Approved in Tariff

Order dated

27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Travelling Expenses

0.62

0.32

Office Expenses

16.44

9.91

Petrol, Oil, Lubricant (P.O.L)

0.01

Rent, Rates & Taxes

0.32

0.15

Advertisement & Publicity

0.20

Professional & Special Services

1.12

0.48

Other Charges

0.84

1.18

Minor Works

1.44

Audit

Accounts

and

Professional Fees

0.01

0.11

Energy Conservation Expense

2.00

Total

19.54

13.80

15.80

Less: share of others (To be

specified)

Total expenses

19.54

13.80

15.80

Less : Capitalized

0.23

Gross Total

19.31

13.80

15.80

Therefore, the Commission approves actual A&G expenses of Rs. 15.80 crore for the True-up of

the FY 2011-12.

3.10. Repair and Maintenance (R&M) Expenses

Petitioner’s Submission:

Repairs and Maintenance activities are being undertaken as a step towards improvement

of systems, reduction in breakdowns, and reduction in response time and increasing

preventive maintenance. Further, the R&M expenses actually incurred for the FY 2011-12

are lower than those approved by the Commission.

Further, R&M expenses are necessary for maintenance of infrastructure and for ensuring

proper Standard of Performance of the Electricity Department Goa and therefore the

Commission is requested to approve Rs. 9.52 crore for the FY 2011-12 as R&M expenses.

Commission’s Analysis:

The Commission observes that the R&M expenses approved in the past were based on

the estimates prepared on cash basis and not accrual basis. The Petitioner has prepared

and submitted the accounts prepared on commercial principles for the first time.

Accordingly, the Commission finds it appropriate to consider the actual R&M expenses as

available in the audited accounts for the purpose of True-up of the FY 2011-12. However,

the Commission has not considered the R&M expense of Rs. 2.00 crore towards “Energy

Conservation Expense” in the FY 2011-12 as the same has been considered as part of the

A&G Expenses.

The R&M expenses as submitted by the Petitioner and approved by the Commission are

shown in the following Table:

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Table 3.10: R&M Expenses approved by the Commission for the True-up of the FY 2011-12

(Rs. crore)

Sr.

No.

Particulars

FY 2011-12

Approved in Tariff

Order dated

27-06-2012

Petitioner’s

Submission

(True-up)

Approved by the

Commission

(True-up)

Maintenance of S/S Transformers &

Distribution Lines

17.03

9.52

8.36

Running & Maintenance of Meters

& Relay Testing Labs.

0.04

Running & Maintenance of

Workshop

0.05

Repairs & Maintenance of

Transformers

0.01

Maintenance & Repairs of Elect.

Residential Building

0.99

Repairs & Carriages, Running &

Maintenance

2.90

Compensation to Accidental Death

of Animals due to electrocution

0.01

Compensation due to accidental

Death of Human being due to

Electrocution

0.00

Other R&M Expenses

-0.38

Change in Inventory

-4.46

Gross Total

17.03

9.52

7.52

Therefore, the Commission approves actual R&M expenses of Rs. 7.52 crore for the

True-up of the FY 2011-12.

3.11. Gross Fixed Assets (GFA), Capitalisation and Depreciation

Petitioner’s Submission:

The opening balance of GFA for the FY 2011-12 comes to Rs. 595.50 crore as per the

annual accounts. In the Tariff order dated 27^thJune, 2012, the Commission had not

considered the opening value of Assets while approving Gross Fixed Assets as the

Petitioner had not submitted a reliable Fixed Asset Register and audited accounts to

support the claim in the Petition. Now, the present submission of the True-Up for the FY

2011-12 is based on the audited accounts.

Further, the prevailing infrastructure is insufficient to cater to the present load and hence

to meet the increasing demand from HT and LT load, it is absolutely necessary to

undertake significant capital expenditure. Accordingly, the capital expenditure of

Rs. 160.41 crorewas undertaken for the FY 2011-12 and the assets worth Rs. 98.19 crore

net (Rs.101.40 addition less Rs. 3.21 crore retired) were capitalized and the Commission is

requested to allow the actual expenditure and capitalisation so as to ensure the creation

of infrastructure for adherence to the Standards of Performance and Supply Code

Regulations.

Also, as per Regulation 26 of Tariff Regulations, 2009, depreciation for the assets has been

calculated annually at the rates specified by CERC from time to time on different asset

categories. Further, the depreciation arrived in annual accounts for the FY 2011-12 is

based on the rates specified by the Commission in its Tariff Regulations which is charged

on pro-rata basis and the Commission is requested to approve the depreciation of

Rs. 32.75 crore for the FY 2011-12.

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Commission’s Analysis:

In the Order dated 27^th June, 2012, the Commission had ordered as follows:

“The Commission in its order dated 07^thMay, 2012 had disallowed the opening GFA in

absence of the audited accounts and Fixed Asset and Depreciation Registers and gave a

directive to the Petitioner to furnish the same urgently and the same was repeated year

after year.

However, the Petitioner has now furnished the audited accounts and the Fixed Asset

Register (FAR) for the FY 2011-12. The Commission has also taken note of the fact that the

Petitioner has prepared the FAR based on physical verification of Fixed Assets carried out

by the Department. However there is discrepancy in the figure of fixed assets as reflected

in the audited balance sheet and the FAR. The Commission has considered the figure of

Gross Fixed Assets as reflected in the FAR as it is based on actual physical verification of

assets available”.

However, the Commission has now reviewed the impact of this approach across all

utilities under its jurisdiction. The Commission observes that in all practical

circumstances, the information as available in the Fixed Assets Register (FAR) has to be

the same as that available in the audited accounts. The Commission also notes that the

Petitioner has made sincere efforts for preparation of the FAR. The Commission is of the

view that once the verification of all the assets is complete, the information available in

the audited accounts shall tally with the information available in the FARs.

Accordingly, the Commission finds it appropriate to henceforth consider the full amount

of GFA as per the audited accounts since FY 2011-12.

Accordingly, the Commission has taken the opening GFA, asset addition and closing

GFA as per the audited accounts for the FY 2011-12 as shown in the following Table:

Table 3.11: GFA approved by the Commission in the True-up of FY 2011-12 (Rs crore)

Particulars

Approved in Tariff

Order dated

27-06-2012

Petitioner's

submission

(True-up)

Approved by the

Commission

(True-up)

Opening GFA

0.00

595.50

Addition during the year

126.00

101.40

Adjustment/Retirement during the FY

3.21

Closing GFA

126.00

693.69

In respect of depreciation, the Commission has followed Regulation 26 of the Tariff Regulations

2009, as under:

“26. Depreciation

(1) For the purpose of tariff, depreciation shall be computed in the following manner:

(i) The value base for the purpose of depreciation shall be the historical cost of the

assets, that is actual expenses limited to approved capital cost where such capital cost

has been approved by the Commission:

Provided that land is not a depreciable asset and its cost shall be excluded from the

capital cost while computing depreciation.

(ii) The historical cost of the asset shall include additional capitalization.

(iii) The historical cost shall include foreign currency funding converted into

equivalent rupees at the exchange rate prevalent on the date when foreign currency

was actually availed but not later than the date of commercial operation.

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(iv) Depreciation for generation and transmission assets shall be calculated annually

as per straight-line method over the useful life of the asset at the rate of depreciation

specified by the Central Electricity Regulatory Commission from time to time:

Provided that the total depreciation during the life of the asset shall not exceed 90% of the

original cost.

Depreciation for distribution and other assets not covered by CERC shall be as per

Government of India norms of 1994 as may be revised by the Commission from time to

time.”

The Commission has not applied the CERC rates applicable on the average assets in

place, since some of these assets have already attained the 90% limit of depreciation

during the life of the asset, and accordingly has approved depreciation as per the audited

accounts for the True-up of the FY 2011-12 as shown in the following Table:

Table 3.12: Asset-wise depreciation approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

Particulars

Opening

GFA

Addn

in GFA

Del

GFA

Closing

GFA

Average

Assets

Eff. Rate of

depreciation

Depreciation

(a)

(b)

(c)

(d)= a+b-c

(e)= (a+d)/2

(f)=g/e

(g)

Plant & Machinery

571.19

100.53

3.12

668.60

619.89

5.16%

31.96

Buildings

12.95

0.37

0.00

13.32

13.14

3.13%

0.41

Vehicles

2.80

0.30

0.02

3.08

2.94

8.50%

0.25

Furniture and Fixtures

1.00

0.08

0.01

1.08

1.04

5.67%

0.06

Computers & others

1.27

0.11

0.05

1.33

1.30

5.54%

0.07

Land

6.28

0.00

6.28

0.00%

0.00

Total

595.50

101.40

3.21

693.69

644.60

32.75

The depreciation amount as submitted by the Petitioner and approved by the Commission

in the True-up of FY 2011-12 is shown in the Tables below:

Table 3.13: Depreciation approved by the Commission in the True-up of FY 2011-12

(Rs. crore)

Particulars

Approved in Tariff Order

dated 27-06-2012

Petitioner's

submission

(True-up)

Approved by the

Commission As per

Audited A/c

(True-up)

Depreciation

3.33

32.75

Therefore, the Commission approves actual depreciation of Rs. 32.75 crore for True-up of

the FY 2011-12.

3.12. Interest and Finance Charges

Petitioner’s Submission:

Regulation 25 of the Tariff Regulations 2009, provides for Interest and Finance Charges on

Loan. The majority of capital assets are created out of the equity contribution from the

Government of Goa. However, the interest expenses have been claimed on the basis of

normative loan calculation whereby 70% of the opening GFA and the capitalisation during

the year has been considered as normative debt. Further, interest on normative loan is

higher than that approved in the Order by the Commission due to the fact that opening

GFA was not approved by the Commission in the absence of audited accounts, resulting

in disallowance of the opening normative loan also. Other than interest on normative loan,

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other Interest and Finance charges towards bank charges, LC charges, etc. have also

been claimed.

The Commission is requested to approve the Interest & Finance Charges at Rs. 52.78

crore (Rs. 49.81 crore + Rs. 2.97 crore) for FY 2011-12.

Commission’s Analysis:

As per Regulation 25 of the Tariff Regulations, 2009:

“1) For existing loan capital interest and finance charges on loan capital shall be

computed on the outstanding loans, duly taking into account the rate of interest and

schedule of repayment as per the terms and conditions of relevant agreements.

2) Interest and finance charges on loan capital for new investments shall be computed

on the loans, duly taking into account the rate of interest and the schedule of repayment as

per the terms and conditions of relevant agreements. The rate of interest shall, however, be

restricted to the prevailing Prime Lending Rate of the State Bank of India.’’ (Read SBI

Advance Rate)

Further as per Regulation 23 of the said Tariff Regulations, 2009:

“23. Debt-Equity Ratio

1) For the purpose of determination of tariff, debt-equity ratio in case of existing,

ongoing as well as new projects commencing after the date of notification of these

Regulations shall be 70:30. Where equity employed is more than 30%, the amount of equity

for the purpose of tariff shall be limited to 30% and the balance amount shall be considered

as loan. Where actual equity employed is less than 30%, the actual debt and equity shall be

considered for determination of tariff:

2) Provided that the Commission may, in appropriate cases, consider equity higher than

30% for the purpose of determination of tariff, where the generating company or the

licensee is able to establish to the satisfaction of the Commission that deployment of equity

more than 30% is in the interest of the general public: .

3) The debt and equity amounts arrived at in accordance with sub-regulation (1) above

shall be used for all purposes including for determining interest on loan, return on equity,

Advance against Depreciation and Foreign Exchange Rate Variation.

4) Provided that in the case of an Integrated Utility, till the time it remains Integrated

Utility, it shall be entitled to return on its capital base as per Schedule VI to the repealed

Electricity (Supply) Act, 1948.”

The above stated Regulations prescribe the debt-equity ratio for the assets

deployed, post the commencement of the Tariff Regulations, 2009. However, for the

EDG, the Commission has determined the Aggregate Revenue Requirement (ARR) for

the first time for the FY 2011-12 and accordingly, the Commission finds it appropriate

not to consider any loan for capitalisation prior to FY 2011-12.

Therefore, opening normative loan for FY 2011-12 is taken as NIL and the

normative interest on loan has been considered only on the assets created during the

year FY 2011-12 onwards as per the audited accounts.

The Commission has considered a net addition of Rs. 98.19 crore in gross fixed assets

for the FY 2011-12, which are considered funded through normative debt to the tune of

70%. The Commission, for the purpose of funding of the capitalisation has considered the

normative debt-equity ratio of 70:30, whereby it has considered the addition in normative

loan at Rs. 68.74 crore (70% of Rs. 98.19 crores) for FY 2011-12.

The Commission has considered weighted average rate of SBI PLR for the year at

14.40% for the FY 2011-12 and the repayment of the debt has been considered at 10% the

opening loan amount. Further, the Commission verified the other financing charges from

the audited accounts and accordingly has approved the same for the FY 2011-12.

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The calculation of the interest on the normative loan is given in the following Table:

Table 3.14: Normative interest on loan approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

Sr.

No.

Particulars

Approved in Tariff

Order dated

27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Opening normative loan

0.00

372.08

0.00

Add: Normative loan during the year

88.20

59.33

68.74

Less: Normative repayment (10 % of 1)

37.21

0.00

Closing normative loan (1+2-3)

88.20

394.21

68.74

Average normative loan (1+4) * 0.5

44.10

383.14

34.37

Rate of interest (SBI PLR)

13.00%

14.40%

Interest on normative loan

5.73

49.81

4.95

Financing Charges

0.69

2.97

Total Interest and Finance Charges

6.42

52.78

7.92

Therefore, the Commission approves interest and finance charges of Rs. 7.92 crore in the

True-up for the FY 2011-12.

3.13. Interest on Security Deposit

Petitioner’s Submission:

Regulation 25 of Tariff Regulations, 2009 read along with Clause 47(4) of the Electricity

Act, 2003 provides for Interest on Security Deposit, if any, made by the consumer with the

licensee.

An amount of Rs. 0.14 crore have been claimed as actual interest paid to the consumers

on security deposits for the FY 2011-12.

Commission’s Analysis:

The Commission has verified the submission from the audited accounts and observed that

the Petitioner has provisioned an amount of Rs. 1.62 crore and Rs. 2.88 crore against

interest on security deposit for the FY 2011-12 and FY 2012-13 respectively and the

cumulative amount of Rs. 4.50 crore has been shown as current liability in the balance

sheet of FY 2012-13. Further, there is no mention of Rs. 0.14 crore in the audited accounts

of FY 2011-12.

The Commission has computed the interest amount due for the payment by applying the

bank rate on average security deposit available as follows:

Table 3.15: Interest on Security Deposit approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

Sr.

No.

Particulars

Approved in Tariff

Order dated

27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Opening Security Deposit

0.00

76.74

Add: Deposits during the Year

0.00

17.65

Less: Deposits refunded

0.00

3.82

Closing Security Deposit

0.00

90.58

Average Security Deposit

0.00

83.66

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Bank Rate

6.00%

Interest on Security Deposit

(Due)

0.00

5.02

Interest on Security Deposit

(Actually Paid)

0.14

0.00

Balance to be paid to the

consumers

0.00

4.88

5.02

Considering the fact that there is no interest payout in actuals, the Commission has not

approved any interest on security deposit in the True-up of the ARR for the FY 2011-12. The

Commission directs the Petitioner to pay the balance interest on consumer security deposit

of Rs. 5.02 crore in the FY 2017-18.

3.14. Return on Capital Base

Petitioner’s Submission:

Being an integrated utility, EDG is entitled to return on capital base under the provisions

of Schedule VI of the repealed Electricity (Supply) Act, 1948 vide provision under

Regulation 23 of Tariff Regulations, 2009. EDG has calculated the return on capital base at

3%. The Commission is requested to kindly allow the return on Net Fixed Assets

(NFA)amounting to Rs. 13.21 crore for the FY 2011-12.

Commission’s Analysis:

Being an integrated utility, EDG is entitled to return on capital base as per Regulation 23

of the Tariff Regulations, 2009. Hence the Commission approves return on capital base on

the basis of GFA and cumulative depreciation as on 01^st April, 2011 as submitted by the

Petitioner and as verified from the audited accounts as per the following Table:

Table 3.16: Return on Capital Base approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

Sr.

No.

Particulars

Approved in

Tariff Order

Dated 27-06-2012

Petitioner's

Submission

(True-up)

Approved by

the Commission

(True-up)

Gross block at beginning of the FY

0.00

595.50

Less: Opening accumulated depreciation

0.00

155.09

Net block at beginning of the FY (1-2)

0.00

440.41

Less: Opening accumulated consumer

contribution

0.00

Net fixed assets at beginning of the FY (3-4)

0.00

440.41

Return @ 3% of NFA

0.00

13.21

Therefore, the Commission approves Return on Net Fixed Assets (NFA) of Rs. 13.21 crore

in the True-up for the FY 2011-12.

3.15. Interest on Working Capital

Petitioner’s Submission:

Interest on Working Capital has been claimed in accordance with Regulation 29 of the

Tariff Regulations, 2009. Further, the closing balance of the security deposit has been

deducted from the total normative Working Capital requirement for computing the

Working Capital requirement as per the methodology followed by the Commission in its

previous Tariff Order.

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Commission’s Analysis:

As per Regulation 29 of the Tariff Regulations, 2009:

“(3) Subject to prudence check, the working capital for integrated utility shall be the sum of

one month requirement for meeting:

a. Power purchase cost

b. Employees cost

c. Administration & general expenses

d. Repair & Maintenance expenses.

e. Sum of two month requirement for meeting Fuel cost.

4) The rate of interest on working capital shall be equal to the short term Prime Lending

Rate of State Bank of India on the 1^st April of the relevant financial year. The interest on

working capital shall be payable on normative basis notwithstanding that the

generating company/licensee has not taken working capital loan from any outside

agency or has exceeded the working capital loan amount worked out on the normative

figures.”

The Commission has considered the calculation of the different components of the

Working Capital on the basis of the above-stipulated norms. The Commission has

deducted average consumer security deposit from the Working Capital requirement

considered for True-up of ARR for the FY 2011-12. The Commission has considered the SBI

PLR as applicable on 01^stApril, 2011. (https://www.sbi.co.in/portal/web/interest-

rates/benchmark-prime-lending-rate-historical-data)

The detailed calculations of the interest on the Working Capital are as mentioned in

the Table below:

Table 3.17: Interest on Working Capital approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

S. No.

Particulars

Approved in

Tariff Order

Dated

27-06-2012

Petitioner's

Submission

(True-up)

Approved by

the

Commission

(True-up)

Power Purchase Cost for one month

78.50

93.76

Employee Cost for one month

10.49

12.92

A&G Expenses for one month

1.61

1.15

1.32

R&M Expenses for one month

1.42

0.79

0.63

Total Working Capital for one month

92.02

108.62

Security Deposit (amount with EDG)

62.57

76.74

83.66

Total borrowing for Working Capital

considered for one month

29.45

31.88

24.96

SBI PLR Rate (%)

13.00%

Interest on Working Capital

3.83

4.14

3.25

Therefore, the Commission approves Rs. 3.25 crore as Interest on Working Capital in the

True-up for the FY 2011-12.

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3.16. Provision for Bad and Doubtful Debts

Petitioner’s Submission:

The Commission has stated in the Tariff Order that bad and doubtful debts actually

written off, limited to 1% as per the Regulations, would be considered only after the

availability of audited accounts and would be taken up at the time of the True-up of the

ARR. Accordingly, based on the audited accounts, bad and doubtful debts actually

written off in the ARR amount to Rs. 2.54 crore in the FY 2011-12.

Commission’s Analysis:

As specified in Regulation 28 of the Tariff Regulations, 2009 (to be read with the format):

“The Commission may, after the generating company/licensee gets the receivables audited,

allow a provision for bad debts up to 1% of receivables in the revenue requirement of the

generating company/licensee.”

It is observed that as per the audited accounts, the licensee has actually written off bad

and doubtful debts amounting to Rs. 11,930 in the FY 2011-12 which the Commission

hasaccordingly considered and approved for the True-up of the FY 2011-12.

3.17. Non-Tariff Income

Petitioner’s Submission:

Non-Tariff Income of Rs. 17.04 crore has been claimed in the True-up of the FY 2011-12.

Commission’s Analysis:

The Commission has verified the submission of the Petitioner from the audited accounts

and found the same to be correct. Hence, the total Non-Tariff Income is Rs. 17.04 crore for

the FY 2011-12 as per the audited accounts, which is approved by the Commission as

follows:

Table 3.18: Non-Tariff Income approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

Particulars

Approved in

Tariff Order

dated

27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission (As

per audited A/c)

(True-up)

Sale Proceeds of dead stock, waste paper etc

0.61

0.97

Receipt from State Electrical Inspectorate

0.45

0.29

Misc. Receipts/income

20.00

11.84

Meter/service rent

0.00

3.72

Deferred Income (Electricity Development fund)

0.00

0.23

Gross Total

21.06

17.04

Therefore, the Commission approves the Non-Tariff Income of Rs. 17.04 crore and or the

FY 2011-12.

3.18. Revenue from Sale of Surplus Power/ Unscheduled Interchange (UI)

Petitioner’s Submission:

Revenue from the sale of surplus power is Rs. 104.18 crore for FY 2011-12 against the

corresponding approved amount of Rs. 118.41 crore for the FY 2011-12.

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Commission’s Analysis:

The Commission has analyzed the submission made by the Petitioner regarding the sale

of surplus power in the Exchange plus UI sales from the audited accounts and found that

the Petitioner has received the following revenue from the sale of surplus power in the

Exchange and UI in the FY 2011-12:

Table 3.19: Revenue from Sale of surplus power approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

Revenue Source

Petitioner's Submission

(True-up)

Approved by the

Commission (As per

audited A/c)

(True-up)

Through sale in Power Exchange

57.70

Through sale in UI

46.48

Total Revenue from sale of Surplus Power

104.18

Therefore the Commission approves the revenue from sale of surplus power of Rs. 104.18

crore in the True-up for the FY 2011-12.

3.19. Revenue at approved Retail Tariff

Petitioner’s Submission:

The revenue from Tariff was Rs. 856.35 crore for the FY 2011-12.

Commission’s Analysis:

The Commission has verified revenue from the sale of power within the State in the FY

2011-12 from the audited accounts.

The category-wise revenue as submitted by the Petitioner and approved by the

Commission is shown in the following Table:

Table 3.20: Revenue from Retail Sale power approved by the Commission in the True-up

of FY 2011-12 (Rs. crore)

S. No.

Particulars

FY 2011-12

Approved in

Tariff Order

dated

27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

A. LOW TENSION SUPPLY

240.50

260.51

(a) LTD/Domestic

106.71

127.16

(b) LTD/L.I.G.

0.34

0.91

0.37

0.93

LTC/Commercial

96.23

92.18

(a) LTP/Motive Power

26.95

23.05

(b) LTP Mixed (Hotel Industries)

2.10

2.91

2.07

LTAG/Agriculture

1.00

2.12

(a) LTPL ( Public lighting )

6.20

8.34

(b) Arrears

0.00

LTPWW/Public Water works

0.60

0.84

B. HIGH TENSION SUPPLY

563.62

582.92

HT ( Mixed )

60.27

50.89

HTI (Industrial) Ferro Metallurgical/ Steel

Melting/Power Intensive.

155.37

136.21

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HTI Industrial

214.93

235.09

HTAG ( Agriculture)

0.50

1.38

EHTI ( Industrial )

61.50

60.79

HT P.W.W. & Sewage system

39.97

53.89

HT. M.E.'s Defense Estt.

12.00

8.01

HTI ( Steel Rolling )

17.12

32.06

HTI / IT High Tech

1.70

1.95

HTI/Ice Manufacturing

0.26

0.11

(a) Sale from EDG to GSPL (Div. VII)

2.50

Sale to MSEDCL (Div. VI)

0.04

HTI Hotel Industry

0.00

C. TEMPORARY SUPPLY

9.80

12.09

(a) L.T. Temporary

9.80

11.78

(b) H.T. Temporary

0.00

0.30

Arrears under RRC (with no. of cases)

0.83

FPPCA charge

0.00

Gross Total

813.65

856.35

Therefore, the Commission approves the revenue from sale of power at Rs. 856.35 crore in

the True-up for the FY 2011-12.

3.20. Aggregate Revenue Requirement (ARR)

Petitioner’s Submission:

The Net Aggregate Revenue Requirement as approved by the Commission in the Review

of the ARR for the FY 2011-12 was Rs. 1,096.80 crore. Based on the True-up submissions

for the FY 2011-12, the Commission is requested to approve an ARR of Rs. 1,287.81 crore.

Commission’s Analysis:

The Commission on the basis of the detailed analysis of the cost parameters of the ARR

has considered and approved the revenue requirement in the True up of the FY 2011-12 at

Rs. 1,239.37 crore as given in the following Table:

Table 3.21: Net ARR approved by the Commission in the True-up of FY 2011-12 (Rs. crore)

Sr.

No.

Particulars

FY 2011-12

Approved in Tariff

Order dated 27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Cost of power purchase for full year

1,060.47

1,125.10

Employee costs

125.89

155.04

Administration and General

Expenses

19.31

13.80

15.80

Repair and Maintenance Expenses

17.03

9.52

7.52

Depreciation

3.33

32.75

Interest and Finance charges

6.42

52.78

7.92

Interest on Working Capital

3.83

4.14

3.25

Interest on Security Deposit

0.14

Return on NFA

13.21

Provision for Bad Debt

2.54

0.00

Other Expenses

Total Revenue Requirement

1,236.28

1,409.03

1,360.59

Less: Non-Tariff Income

21.06

17.04

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Less: Revenue from Surplus Power

Sale/UI

118.41

104.18

Net Revenue Requirement

1,096.80

1,287.81

1,239.37

3.21. Revenue Gap/(Surplus)

Petitioner’s Submission:

Along with the ‘Tariff Proposal for the FY 2012-13’ submitted vide affidavit dated

05^thApril, 2012, it was submitted that the entire revenue gap for FY 2011-12 as per the

revised estimates is to be met through budgetary support and there is no revenue gap of

FY 2011-12 to be carried forward in FY 2012-13.

A letter from the Government of Goa (addressed to EDG and signed by the Under

Secretary Finance, Budget Department, Government of Goa) for budgetary support for FY

2011-12 dated 05^th April, 2012, the main contents of which are reproduced below:

‘‘I am directed to state that the Government of Goa has decided to continue with the

existing electricity tariff for the consumers in the state during the Financial Year 2011-12,

and had provided the requisite budgetary support to meet the deficit, and hence has

decided not to carry forward the deficit as may be approved by the Hon’ble Commission

during the process of finalizing the ARR for FY 2011-12 to the next financial year 2012-13.’’

Accordingly, the revenue gap of Rs. 431.46 crore for FY 2011-12, has not been carried

forward and will be met through the budgetary support as proposed in the earlier

submission.

Commission’s Analysis:

The Commission has analyzed and approved the Revenue Gap/(Surplus) as follows:

Table 3.22: Revenue Gap/(Surplus) approved by the Commission in the True-up of the

FY 2011-12 (Rs. crore)

Sr.

No.

Particulars

FY 2011-12

Approved in Tariff

Order

dated 27-06-2012

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Net Revenue Requirement

1,096.80

1,287.81

1,239.37

Revenue from Retail Sales at

Existing Tariff

813.65

856.35

Net Gap/(Surplus)

283.15

431.46

383.02

Budgetary Support from

Government

283.15

431.46

383.02

Net Final Revenue Gap/(Surplus)

The Petitioner has submitted that the entire gap for the FY 2011-12 is committed to be

funded by the Government of Goa by way of budgetary support. The petitioner in this regard

has also submitted the letter from Government of Goa wherein the Government of Goa has

assured to provide requisite budgetary support to meet the deficit at the existing tariff for the

FY 2011-12. In view of the budgetary support for the FY 2011-12 from the Government of

Goa, the Commission approves Nil net revenue gap in the True-up for the FY 2011-12.

Chapter 4. True-up for the FY 2012-13

4.1. Applicable provisions of JERC for the State of Goa and Union Territories (Terms and

Conditions for Determination of Tariff) Regulations, 2009

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The True-up of the FY 2012-13 is to be carried out as per Regulation 8(2) of the Tariff

Regulations, 2009:

(2) (i) After audited accounts of a year are made available, the Commission shall undertake

similar exercise as above with reference to the final actual figures as per the audited

accounts. This exercise with reference to audited accounts shall be called ‘Truing Up’.

(ii) The Truing Up for any year will ordinarily not be considered after more than one year

of ‘Review’.

(3) The revenue gap of the ensuing year shall be adjusted as a result of review and truing up

exercises.

(4) While approving such expenses/revenues to be adjusted in the future years as arising

out of the Review and/or Truing up exercises, the Commission may allow the carrying costs

as determined by the Commission of such expenses/revenues. Carrying costs shall be

limited to the interest rate approved for working capital borrowings.

(5) For any revision in approvals, the licensee would be required to satisfy the Commission

that the revision is necessary due to conditions beyond its control.

(6) In case additional supply is required to be made to any particular category, the licensee

may, any time during the year make an application to the Commission for its approval. The

application will demonstrate the need for such change of consumer mix and additional

supply of power and also indicate the manner in which the licensee proposes to meet the

cost for such change of consumer mix and additional supply of power.

(7) The Commission may consider granting approval to such proposals provided the cost of

additional supply is ordinarily met by the beneficiary category.”

4.2. Approach for the True-up of the FY 2012-13

While the Petitioner has submitted the True-up for the FY 2012-13 along with the audited

accounts, it has been observed that the Petitioner has not submitted certain information (even

in the response to data gaps sought by the Commission) that is required to undertake a proper

True-up.

The Commission has adopted the following approach which is in conformity with the Tariff

Regulations, 2009 for True-up of ARR for the FY 2012-13:

1. The Commission has considered energy availability at the periphery of the Petitioner’s

territory and UI sale/UI purchase from Unscheduled Interchange (UI) Accounts

maintained by Southern Regional Power Committee (SRPC) and Western Regional

Power Committee (WRPC) in this regard.

2. The total power purchase cost of the Petitioner for the True-up period has been taken

from the audited accounts of the Petitioner.

3. The Commission has adjusted the security deposit as available with the Petitioner at

the end of the financial year from the Working Capital requirements of the financial year

for subsequent calculation of the Interest on Working Capital.

4. In the True-up years, the Commission has considered the bad and doubtful debts

actually written-off as an expense and not allowing any provision for bad debts.

For the issues in regards to the True-up other than listed above, the Commission has

adopted treatment on basis of Tariff Regulations, 2009.

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The Commission had determined the ARR for the FY 2012-13 vide its Order dated 27^th June,

2012 and subsequently carried out the Review of the FY 2012-13 in its Order dated 31^st March,

2013.

In this Chapter, the Commission has analysed all the elements of actual revenue and

expenses for the FY 2012-13 and has carried out the True up of expenses and revenue with

reference to the actual figures (final) as per the audited accounts, after a prudence check and

has permitted necessary adjustments in cases where variations are for reasonable and

justifiable reasons.

4.3 Energy Sales

Petitioner’s Submission:

The actual energy sales for the FY 2012-13 were 2,925.24MU, as against 2,885.98MU

approved earlier by the Commission vide Tariff Order dated 31^st March, 2013.

Commission’s Analysis:

The Commission, after going through the submissions of the Petitioner including the

audited accounts, has considered the energy sales at 2,925.24 MU as submitted by the

Petitioner for the purpose of True-up of the FY 2012-13 as shown in the following Table:

Table 4.1: Energy Sales approved by the Commission in the True-up of the FY 2012-13

(in MU)

Sr.

No.

Particulars

FY 2012-13

Approved in APR

Order

dated 31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

A. LOW TENSION SUPPLY

1,172.98

1,195.89

(a) LTD/Domestic

828.49

797.35

(b) LTD/L.I.G.

2.00

7.48

5.00

4.37

LTC/Commercial

216.49

250.71

(a) LTP/Motive Power

83.00

75.32

(b) LTP Mixed (Hotel Industries)

5.00

5.50

0.00

7.03

LTAG/Agriculture

16.00

12.89

LTPL ( Public lighting )

15.00

32.92

LTPWW/Public Water works

2.00

2.31

B. HIGH TENSION SUPPLY

1,698.00

1,708.96

HT ( Mixed )

281.00

114.79

HTI (Industrial) Ferro

Metallurgical/ Steel

Melting/Power Intensive.

490.00

525.68

HTI Industrial

596.00

640.38

HTAG ( Agriculture)

5.00

6.35

EHTI ( Industrial )

139.00

132.24

HT P.W.W. & Sewage system

99.00

139.78

HT. M.E.'s Defense Estt.

34.00

25.49

HTI ( Steel Rolling )

47.00

63.72

HTI / IT High Tech

7.00

40.55

HTI/Ice Manufacturing

0.00

0.49

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Sale from EDG to GSPL (Div. VII)

0.00

5.39

HTI Hotel Industry

14.11

C. TEMPORARY SUPPLY

15.00

20.39

(a) L.T. Temporary

14.00

19.65

(b) H.T. Temporary

1.00

0.74

Total

2,885.98

2,925.24

Therefore, the Commission approves the total sales of 2,925.24 MU in the True-up of the

FY 2012-13.

4.4. Power Purchase Quantum and Cost

Petitioner’s Submission:

An amount of Rs. 1,045.22 crore has been incurred for the procurement of 3,576.54 MU of

power in the FY 2012-13 as against the total power purchase cost of Rs. 866.01 crore

approved by the Commission for the purchase of 3547.79MU of power for the FY 2012-13

in its Order dated 31^st March, 2013.

The source-wise actual power purchase quantum and cost for FY 2012-13 is summarized

in the following Table:

Table 4.2: Power Purchase quantum (MU) and cost (Rs. crore) submitted by the Petitioner

for the True-up of the FY 2012-13

Sr.

No.

Source

Purchase (MU)

Power Purchase Cost (Rs. crore)

Fixed

Variable

Others

Suppl.

Total

Central Sector Power Stations

NTPC

3,111.43

218.60

382.41

1.73

48.03

650.77

KSTPS

1,562.75

87.85

143.96

0.94

32.54

265.30

VSTPS - I

242.75

17.02

30.99

0.37

8.03

56.42

VSTPS - II

99.61

7.70

11.62

0.15

2.76

22.22

VSTPS -III

89.54

9.75

10.48

0.14

2.46

22.84

VSTPS-IV

1.11

0.41

0.11

-0.20

0.32

KGPP

56.54

8.44

13.82

-0.45

21.82

GGPP

67.29

10.92

15.72

-0.09

26.55

SIPAT- I

116.73

16.65

15.41

0.04

0.98

33.08

FSTPS

0.05

KSTPS-III

42.29

6.14

3.87

0.03

0.31

10.34

TSTPS

KHSTPS-I

RSTPS

758.93

43.45

127.50

11.20

182.14

SIPAT- II

73.78

10.00

8.91

0.06

0.29

19.25

Mouda

0.10

0.26

0.03

-0.24

0.05

Add/ Less: Other

Adjustments

-9.60

RGPPL

41.78

23.45

III

NPCIL

197.43

50.23

KAPS

109.79

25.58

TAPS

87.64

24.65

24.65

Traders

20.82

8.28

NVVN Limited

20.82

8.28

OVER/ UNDER

DRAWAL

19.45

38.31

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Within State Generations

CO- GENERATION

71.80

17.09

Goa Energy Private

Limited

61.64

14.65

Goa Sponge & Power

Limited

10.17

2.44

IPP:

Reliance Infra

113.83

21.51

135.83

157.34

OTHER CHARGES

99.75

PGCIL Transmission

Charges, Wheeling

& Other Charges

99.75

Total

3,576.54

240.11

655.60

1.73

48.03

1,045.22

Commission’s Analysis:

The Commission has verified the power purchase details as submitted by the

Petitioner in its Petition with the publicly available information from the Regional Energy

Accounts (REA) maintained by Western Region Power Committee (WRPC) on their

website (http://www.wrpc.gov.in/) for the Central Generating Stations (CGS). Further,

apart from western region, the Petitioner also gets supply from the southern region from

the NTPC’s Ramagundam Thermal Power Station. The Commission has validated the

power purchase details pertaining to this station from the publicly available information

from the Regional Energy Accounts (REA) maintained by Southern Region Power

Committee (SRPC) on their website (http://www.srpc.kar.nic.in/).

The Commission observes that there is a minor difference of 0.28 MU in the energy

quantum as submitted by the Petitioner and as available in REA for the FY 2012-13 for the

purchase from CGS (except UI).

Also, the Commission notes that the Petitioner has done netting off of the UI over-

drawal and UI under-drawal in its submission. The Commission, as a part of the prudence

check, has considered the over-drawal and under-drawal separately from the Unscheduled

Interchange (UI) accounts maintained by WRPC as well as SRPC.

Further, the Commission has also verified the power purchase cost as submitted by the

Petitioner with the amount reflecting in the audited accounts of the FY 2012-13. Hence the

Commission approves the power purchase cost as submitted by the Petitioner.

Accordingly the Commission approves the following power purchase cost and

quantum for the FY 2012-13 in the Table given below:

Table 4.3: Power purchase quantum (in MU) approved by the Commission in the True-up

of FY 2012-13

Sr.

No.

Source

Energy (MU)

Power Purchase Cost (Rs. crore)

True Up

Submission

True Up

Order

Difference

Fixed

Variable

Others

Suppl.

Total

Central Sector Power Stations

NTPC

3,111.43

0.00

218.60

382.41

1.73

48.03

650.77

KSTPS

1,562.75

87.85

143.96

0.94

32.54

265.30

VSTPS - I

242.75

0.00

17.02

30.99

0.37

8.03

56.42

VSTPS - II

99.61

7.70

11.62

0.15

2.76

22.22

VSTPS -III

89.54

9.75

10.48

0.14

2.46

22.84

VSTPS-IV

1.11

0.41

0.11

-0.20

0.32

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KGPP

56.54

0.00

8.44

13.82

-0.45

21.82

GGPP

67.29

10.92

15.72

-0.09

26.55

SIPAT- I

116.73

16.65

15.41

0.04

0.98

33.08

FSTPS

0.05

KSTPS-III

42.29

6.14

3.87

0.03

0.31

10.34

TSTPS

KHSTPS-I

RSTPS

758.93

43.45

127.50

11.20

182.14

SIPAT- II

73.78

10.00

8.91

0.06

0.29

19.25

Mouda

0.10

0.26

0.03

-0.24

0.05

Add/ Less:

Other

Adjustments

-9.60

RGPPL

41.78

41.84

0.06

23.45

III

NPCIL

197.43

197.09

-0.34

50.23

KAPS

109.79

109.45

-0.34

25.58

TAPS

87.64

24.65

24.65

Traders

20.82

8.28

NVVN Limited

20.82

8.28

OVER/

/UNDER

DRAWAL

19.45

101.29

81.84

38.31

Within State Generations

CO-

GENERATION

71.80

17.09

Goa Energy

Private

Limited

61.64

14.65

Goa Sponge &

Power Limited

10.17

2.44

IPP:

Reliance Infra

113.83

21.51

135.83

157.34

OTHER

CHARGES

99.75

PGCIL

Transmission

Charges,

Wheeling &

Other Charges

99.75

Total

3,576.54

3,658.10

81.57

240.11

655.60

1.73

48.03

1,045.22

The Commission observes that the Power Purchase cost of Rs. 1,045.22 crore as claimed by

the Petitioner is the same as reflected in the audited accounts for the FY 2012-13.

The total power purchase quantum and cost as submitted by the Petitioner and approved

by the Commission is tabulated hereunder:

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Table 4.4: Summary of Power Purchase approved by the Commission in the True-up

of the FY 2012-13

Particulars

Approved in APR Order

dated 31-03-2013

Petitioner's Submission

(True-up)

Approved by the

Commission

(True-up)

Power Purchase Quantum (MU)

3547.79

3,576.54

3,658.10

Power Purchase Cost (Rs. crore)

866.01

1,045.22

Average Per Unit Cost (Rs./kWh)

2.44

2.92

2.86

Therefore, the Commission approves the overall power purchase quantum of 3,658.10

MU at the cost of Rs. 1,045.22 crore in the True-up of the FY 2012-13.

4.5. Renewable Purchase Obligations (RPOs)

As per Clause 1, sub-clause (1) of the JERC for the State of Goa and UTs (Procurement of

Renewable Energy) Regulations, 2010

“Each distribution licensee shall purchase electricity (in kWh) from renewable energy

sources, at a defined minimum percentage of the total consumption of all the consumers in its

area during a year.”

The Commission, in its Business Plan Order dated 22^nd December, 2015 issued in the

Petition No. 186/2015, has reiterated that all the pending RPO’s upto the FY 2015-16 must

be fulfilled by the Petitioner by 31^st March, 2016 and no backlog would be allowed to carried

forward to the MYT Control Period from FY 2016-17 to FY 2018-19.

The Petitioner has not submitted any information towards RPO compliance in the Petition.

Further, in response to data gaps, the Petitioner has submitted that the RPO backlog has been

fully eliminated in the FY 2015-16. The Petitioner also provided copy of the affidavit as

submitted in the Petition No. 175/2015 in this context.

Keeping in view the above, the Commission has not considered any incentive/penalty

towards RPO compliance in the FY 2012-13 and shall consider the same at the time of True-

up of the FY 2015-16.

4.6. Intra-State Transmission and Distribution (T&D) losses

Petitioner’s Submission:

For the FY 2012-13, the Intra State T&D Loss and Inter State Loss is 13.58% and 4.57%

respectively. The power scheduled from the Southern Region originates from Ramagundam

periphery, which is located in Andhra Pradesh. Hence, the power which shall be made

available at Goa periphery is subjected to substantial amount of losses viz Intra State Loss

of Andhra Pradesh, Inter State Losses of SR & WR. Further, there was a Grid Diversion for a

period of 6 months due to KEB Ckts breakdown and PP outages; hence there was an

additional loss in the energy available at the Goa Periphery in the first half of FY 2012-13

resulting in higher inter State loss.

Commission’s Analysis:

The Commission has analyzed the actual T&D losses based on the drawal schedule as

available on the WRPC and SRPC websites. The actual drawal at the periphery of Goa has

been considered from the weekly UI sheets for the year as available on the WRPC and

SRPC websites as shown in the following Table:

Particulars

FY 2012-13

Actual Drawal at Western Region periphery (WRPC)

2569.51

Actual Drawal at Southern Region periphery (SRPC)

613.11

Total

3182.62

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Further, the sales allowed for the FY 2012-13 i.e. 2,925.24 MU respectively has been

considered, to arrive at the actual Intra-State T&D loss of 13.15% for the utility as tabulated

below:

Table 4.5: Intra-State T&D Losses approved by the Commission in the True-up of the

FY 2012-13 (MU)

Particulars

Approved in

APR Order

dated

31-03-2013

Petitioner's

submission

(True-up)

Approved by the

Commission

(True-up)

Net energy drawn at State periphery (MU)

3,141.56

3,199.16

3,182.62

Net energy available from sources within

the State (Cogen + IPP) (MU)

156.05

185.63

Total Energy available at State periphery

for sale to Retail Consumers (MU)

c=a+b

3,297.61

3,384.80

3,368.25

Energy sales within the State (MU)

2,885.98

2,925.24

T&D Losses (MU)

e=c-d

411.63

459.55

443.01

T&D Losses (%)

f=e/c

12.48%

13.58%

13.15%

The Commission, therefore, considers the actual T&D loss of 13.15% for the True-up of

the FY 2012-13 respectively.

Further, the Commission accepts the submission of the Petitioner that the accounting in

the FY 2011-12 has witnessed a transitional change from cash to accrual method which

resulted into change in energy accounting with regards to billing also. As the Petitioner has

prepared and submitted accounts based on commercial principles for the 1^st time for the FY

2012-13, the Commission has decided not to consider any incentive/penalty for the

overachievement/underachievement of T&D Losses in the FY 2012-13 keeping in view the

transition period required for such change.

4.7. Energy Balance

Petitioner Submission

The energy balance for the FY 2012-13 is tabulated below:

Table 4.6: Energy Balance for FY 2012-13 as submitted by the Petitioner (MU)

Sr. No.

Item

FY 2012-13

Audited (MU)

Energy Input at Goa Periphery

3,199

Total Power Scheduled/ Purchased at Goa Periphery

Total Schedule Billed Drawal - CGS (MU)

3,351

Add: Overdrawal / purchase from Traders (MU)

114

Add: Power purchase from NVVN (MU)

Less: Under-drawal (MU)

Less: Power diverted to Exchange (MU)

Less: Banking Power (MU)

Total (MU)

3,352

PGCIL Losses - MU

153

PGCIL Losses - % *

4.57%

Total Power Purchased within Goa State

Add: Co-generation (MU)

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Add: Independent Power Producers (IPP) (MU)

114

Total (MU)

186

Total Power Purchase availability after PGCIL Losses (MU)

3,385

Less: Retail Sales to Consumers (MU)

2,925

Distribution Losses - MUs

460

Distribution Losses - %

13.58%

Commission’s Analysis:

As detailed in previous sections, the Commission has examined the REA and weekly UI

accounts for the FY 2012-13 as available in the public domain on the websites of SRPC

and WRPC for validating the energy purchased by the Petitioner from the power plants/

/traders/ exchange/ banking arrangement/UI mechanism.

Accordingly, the Energy Balance as considered by the Commission for the True-up of the

FY 2012-13 is shown in Table below:

Table 4.7: Energy Balance approved by the Commission for True-up of the FY 2012-13 (MU)

Particulars

Formulae

Approved in

Tariff Order

Dated

31-03-2013

Petitioner's

submission

(True-up)

Approved by

the Commission

(True-up)

ENERGY REQUIREMENT

Energy sales within the State (MU)

2,885.98

2,925.24

T&D Losses within the State (%)

12.48%

13.58%

13.15%

T&D Losses within the State (MU)

c=d-a

411.63

459.55

443.01

Total Energy required at State

periphery for sale to Retail

Consumers (MU)

d=1/(1-b)

3,297.61

3,384.80

3,368.25

Less: Power purchase from sources

within the State (MU)

156.05

185.63

Total Energy required at State

periphery from Sources located

outside the State (MU)

f=d-e

3,141.56

3,199.16

3,182.62

Energy Transactions at Periphery

Add: Sales in Power Exchanges (MU)

19.57

38.71

30.64

Add: Sales in UI (MU)

114.73

Add: Sales under Banking

Arrangement (MU)

Less: Purchase under UI (MU)

60.09

19.45

101.29

Less: Purchase from Traders (MU)

20.82

Total energy scheduled at State

Periphery from Tied-up Sources (MU)

l=f+g+h

+i-j-k

3,080.22

3,197.60

3,205.88

Interstate Losses (%)

6.97%

4.57%

4.31%

Interstate Losses (MU)

230.61

153.03

144.48

Total requirement from Tied-up

sources at generator end (MU)

o=l+n

3,310.83

3,350.64

3,350.36

Total requirement from Tied-up

sources at generator end &

UI/Traders/Banking/Within State

(MU)

p=o+e+j

3,547.79

3,576.54

3,658.10

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ENERGY AVAILABILITY

NTPC (MU)

3,114.23

3,111.43

RGPPL (MU)

41.78

41.84

NPCIL (MU)

196.60

197.43

197.09

Traders (MU)

20.82

OVER/ UNDER DRAWAL (MU)

60.09

19.45

101.29

Generation within the State (MU)

156.05

185.63

Total Availability from Tied-up

sources at generator end &

UI/Traders/Sources within State (MU)

w=q+r+

s+t+u+v

3,547.79

3,576.54

3,658.10

4.8. Employee Expenses

Petitioner’s Submission:

Employee expenses for the FY 2012-13 are based on the actual employee expenses incurred

during the entire year.

However, the employee cost in FY 2012-13 has decreased marginally as compared to FY

2011-12.

Commission’s Analysis:

The Commission observes that the employee expenses approved in the past were based on

the estimates prepared on cash basis and not accrual basis. The Petitioner has prepared

and submitted the audited accounts prepared on commercial principles for the first time.

Accordingly, the Commission finds it appropriate to consider the actual employee costs as

available in the audited accounts for the purpose of True-up of the FY 2012-13 as shown in

the Table below:

Table 4.8: Employee Expenses approved by the Commission for the True-up of the

FY 2012-13 (Rs. crore)

S. No.

Particulars

FY 2012-13

Approved in APR

Order

dated 31-03-2013

Petitioner's Submission

(True-up)

Approved by the

Commission

(True-up)

Salaries& Allowances

122.49

154.63

148.37

Pension Contribution and

Terminal Benefits

7.02

6.11

Other Salary payments

6.94

0.15

Gross Total

136.44

154.63

Therefore, the Commission approves actual employee expenses of Rs. 154.63 crore for

the True-up of the FY 2012-13.

4.9. Administrative and General (A&G) Expenses

Petitioner’s Submission:

In the APR order dated 31^st March, 2013, the Commission had approved the A&G expenses

of Rs. 8.59 crore for the FY 2012-13.

Commission’s Analysis:

The Commission observes that the A&G expenses approved in the past were based on the

estimates prepared on cash basis and not accrual basis. The Petitioner has prepared and

submitted the audited accounts prepared on commercial principles for the first time.

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Accordingly, the Commission finds it appropriate to consider the actual A&G expenses as

available in the audited accounts for the purpose of True-up of the FY 2012-13 as shown in the

Table below:

Table 4.9: Employee Expenses approved by the Commission for the True-up of FY 2012-13

(Rs. crore)

S. No.

Particulars

FY 2012-13

Approved in APR

Order dated

31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Travelling Expenses

8.59

0.37

Office Expenses

17.98

Petrol, Oil, Lubricant (P.O.L)

0.01

Rent, Rates & Taxes

0.22

Advertisement & Publicity

0.24

Professional & Special Services

0.44

Other Charges

1.14

Minor Works

1.77

Audit of Accounts and

Professional Fees

0.11

Total

8.59

22.27

Less : share of others (To be

specified)

Total expenses

8.59

22.27

Less : Capitalized

Gross Total

8.59

22.27

Therefore, the Commission approves actual A&G expenses of Rs. 22.27 crore for the

True-up of the FY 2012-13.

4.10. Repair and Maintenance (R&M) Expenses

Petitioner’s Submission:

Repairs and Maintenance activities are being undertaken as a step towards

improvement of systems, reduction in breakdowns, reduction in response time and

increasing preventive maintenance.

For the FY 2012-13, R&M expenses have increased by 3% as compared to the cost

approved by the Commission. Since in the FY 2011-12, R&M expenses were remarkably

low, accordingly there couldn’t be a comparison of the actual R&M expenses of the FY

2012-13 with the FY 2011-12 in the context of year on year increase in cost.

Further, R&M expenses are necessary for maintenance of infrastructure and for ensuring

proper Standards of Performance of the Electricity Department Goa and therefore the

Commission is requested to approve Rs. 19.16 crore for the FY 2012-13 as R&M expenses.

Commission’s Analysis:

The Commission observes that the R&M expenses approved in the past were based on

the estimates prepared on cash basis and not accrual basis. The Petitioner has prepared

and submitted the accounts prepared on commercial principles for the first time.

Accordingly, the Commission finds it appropriate to consider the actual R&M expenses

as available in the audited accounts for the purpose of True-up of the FY 2012-13 as

shown in the following Table:

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Table 4.10: R&M Expenses approved by the Commission for the True-up of the FY 2012-13

(Rs. crore)

Sr.

No.

Particulars

FY 2012-13

Approved in APR Order

Dated 31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Maintenance of S/S Transformers

& Distribution Lines

18.55

19.16

14.97

Running & Maintenance of Meters

& Relay Testing Labs

0.01

Running & Maintenance of

Workshop

0.03

Repairs & Maintenance of

Transformers

0.03

Maintenance & Repairs of Elect.

Residential Building

0.81

Repairs & Carriages, Running &

Maintenance

3.08

Compensation to Accidental

Death of Animals due to

electrocution

0.01

Compensation due to accidental

Death of Human being due to

Electrocution

0.15

Other R&M Expenses

1.05

Change in Inventory

-0.98

Gross Total

18.55

19.16

Therefore, the Commission approves actual R&M expenses of Rs. 19.16 crore for the

True-up of the FY 2012-13.

4.11. Gross Fixed Assets (GFA), Capitalisation and Depreciation

Petitioner’s Submission:

The opening balance of GFA comes to Rs. 693.69 crore for the FY 2012-13 as per the

annual accounts. In the Tariff order dated 27^thJune, 2012, the Commission had not

considered the opening value of Assets while approving the Gross Fixed Assets as the

Petitioner had not submitted a reliable Fixed Asset Register and audited accounts to

support the claim in the Petition. Now, the present submission of the True Up for the FY

2012-13 is based on the audited accounts.

Further, the prevailing infrastructure is insufficient to cater to the present load and hence

to meet the increasing demand from HT and LT load, it is absolutely necessary to

undertake significant capital expenditure. Accordingly, the capital expenditure of

Rs. 97.20 crore was undertaken for the FY 2012-13 and the assets worth Rs. 123.15 crore

net (Rs. 125.81 addition less Rs. 2.66 crore retired) were capitalized and the Commission

is requested to allow the actual expenditure and capitalisation so as to ensure the

creation of infrastructure for adherence to the Standards of Performance and Supply Code

Regulations.

Also, as per Regulation 26 of the Tariff Regulations, 2009, depreciation for the assets has

been calculated annually at the rates specified by CERC from time to time on different

asset categories. Further, the depreciation arrived in annual accounts for the FY 2012-13

is based on the rates specified by the Commission in its Tariff Regulations which is

charged on pro-rata basis and the Commission is requested to approve the depreciation

of Rs. 35.45 crore for the FY 2012-13.

Commission’s Analysis:

The Commission has taken the closing GFA of the FY 2011-12 as approved in previous

Chapter as the opening GFA for the FY 2012-13. Further, the asset addition has been

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considered as per the audited accounts to arrive at the closing GFA for the FY 2012-13 as

shown in the Table below:

Table 4.11: GFA approved by the Commission in the True-up of FY 2012-13 (Rs. crore)

Particulars

Approved in the Tariff

Order dated

28^th April, 2016

Petitioner's

submission

(True-up)

Approved by the

Commission

As per Audited A/c

(True-up)

Opening GFA

126.00

693.69

Addition during the year

81.30

125.81

Adjustment/Retirement during the FY

2.66

Closing GFA

207.30

816.84

In respect of depreciation, the Commission has followed Regulation 26 of the Tariff

Regulations 2009, as under:

“26. Depreciation

(1) For the purpose of tariff, depreciation shall be computed in the following manner:

(i) The value base for the purpose of depreciation shall be the historical cost of the assets,

that is actual expenses limited to approved capital cost where such capital cost has been

approved by the Commission:

Provided that land is not a depreciable asset and its cost shall be excluded from the capital

cost while computing depreciation.

(ii) The historical cost of the asset shall include additional capitalization.

(iii) The historical cost shall include foreign currency funding converted into equivalent

rupees at the exchange rate prevalent on the date when foreign currency was actually

availed but not later than the date of commercial operation.

(iv) Depreciation for generation and transmission assets shall be calculated annually as per

straight-line method over the useful life of the asset at the rate of depreciation specified by

the Central Electricity Regulatory Commission from time to time.

Provided that the total depreciation during the life of the asset shall not exceed 90% of the

original cost.

Depreciation for distribution and other assets not covered by CERC shall be as per

Government of India norms of 1994 as may be revised by the Commission from time to

time.”

The Commission has not applied the CERC rates applicable on the average assets in

place, since some of these assets have already attained the 90% limit of depreciation

during the life of the asset, and accordingly has approved depreciation as per the audited

accounts for the True-up of the FY 2011-12 and FY 2012-13 as shown in the following

Tables:

Table 4.12: Asset-wise depreciation approved by the Commission in the True-up of

FY 2012-13 (Rs. crore)

Particulars

Opening

GFA

Addn

in GFA

Del

GFA

Closing

GFA

Average

Assets

Eff. Rate of

depreciation

Depreciation

(a)

(b)

(c)

(d)= a+b-c

(e)= (a+d)/2

(f)=g/e

(g)

Plant & Machinery

668.60

125.30

2.60

791.30

729.95

4.74%

34.63

Buildings

13.32

0.02

0.00

13.34

13.33

3.13%

0.42

Vehicles

3.08

0.36

0.04

3.41

3.24

8.21%

0.27

Furniture and Fixtures

1.08

0.05

0.01

1.12

1.10

5.65%

0.06

Computers & others

1.33

0.08

0.02

1.39

1.36

5.62%

0.08

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Land

6.28

0.00

6.28

0.00%

0.00

Total

693.69

125.81

2.66

816.84

755.27

35.45

The depreciation amount as submitted by the Petitioner and approved by the Commission

in the True-up of FY 2012-13 is shown in the Table below:

Table 4.13: Depreciation approved by the Commission in the True-up of FY 2012-13

(Rs. crore)

Particulars

Approved in APR

Order dated

31-03-2013

Petitioner's submission

(True-up)

Approved by the Commission

As per Audited A/c

(True-up)

Depreciation

8.80

35.45

Therefore, the Commission approves actual depreciation of Rs. 35.45 crore for True-up of

the FY 2012-13.

4.12. Interest and Finance Charges

Petitioner’s Submission:

Regulation 25 of the Tariff Regulations, 2009, provides for Interest and Finance Charges

on Loan. The majority of capital assets are created out of the equity contribution from the

Government of Goa. However, the interest expenses have been claimed on the basis of

normative loan calculation whereby 70% of the opening GFA and the capitalisation during

the year has been considered as normative debt. Further, interest on normative loan is

higher than that approved in the Order by the Commission due to the fact that opening

GFA was not approved by the Commission in the absence of audited accounts, resulting

in disallowance of the opening normative loan also. Other than interest on normative

loan, other Interest and Finance charges towards bank charges, LC charges, etc. have

also been claimed.

The Commission is requested to approve the Interest & Finance Charges at Rs. 61.93

crore (Rs. 60.06 crore + Rs. 1.87 crore) for FY 2012-13.

Commission’s Analysis:

As per Regulation 25 of the Tariff Regulations, 2009:

“1) For existing loan capital interest and finance charges on loan capital shall be computed

on the outstanding loans, duly taking into account the rate of interest and schedule of

repayment as per the terms and conditions of relevant agreements.

2) Interest and finance charges on loan capital for new investments shall be computed on

the loans, duly taking into account the rate of interest and the schedule of repayment as

per the terms and conditions of relevant agreements. The rate of interest shall, however, be

restricted to the prevailing Prime Lending Rate of the State Bank of India.’’ (Read SBI

Advance Rate)

Further as per Regulation 23 of the said Tariff Regulations, 2009:

“23. Debt-Equity Ratio

1) For the purpose of determination of tariff, debt-equity ratio in case of existing, ongoing

as well as new projects commencing after the date of notification of these Regulations shall

be 70:30. Where equity employed is more than 30%, the amount of equity for the purpose of

tariff shall be limited to 30% and the balance amount shall be considered as loan. Where

actual equity employed is less than 30%, the actual debt and equity shall be considered for

determination of tariff:

2) Provided that the Commission may, in appropriate cases, consider equity higher than

30% for the purpose of determination of tariff, where the generating company or the

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licensee is able to establish to the satisfaction of the Commission that deployment of equity

more than 30% is in the interest of the general public: .

3) The debt and equity amounts arrived at in accordance with sub-regulation (1) above

shall be used for all purposes including for determining interest on loan, return on equity,

Advance against Depreciation and Foreign Exchange Rate Variation.

4) Provided that in the case of an Integrated Utility, till the time it remains Integrated

Utility, it shall be entitled to return on its capital base as per Schedule VI to the repealed

Electricity (Supply) Act, 1948.”

The Commission has considered closing normative loan approved for the FY 2011-12 in

the previous Chapter as opening loan for the FY 2012-13. Further, a net addition of

Rs. 123.15 crore in gross fixed assets for the FY 2012-13 respectively, which are

considered funded through normative debt to the tune of 70%. The Commission, for the

purpose of funding of the capitalisation has considered the normative debt-equity ratio of

70:30, whereby it has considered the addition in normative loan at Rs. 86.20 crore (70% of

Rs. 123.15 crores) for the FY 2012-13.

The Commission has considered weighted average rate of SBI PLR for the year at 14.61%

for the FY 2012-13 and the repayment of the debt has been considered at 10% of the

opening loan amount. Further, the Commission verified the other financing charges from

the audited accounts and accordingly has approved the same for the FY 2012-13.

The calculation of the interest on the normative loan is given in the following Table:

Table 4.14: Normative interest on loan approved by the Commission in the True-up

of FY 2012-13 (Rs. crore)

Sr.

No.

Particulars

Approved in APR

Order Dated

31-03-2013

Petitioner's

Submission

(True-up)

Approved by

the Commission

(True-up)

Opening normative loan

88.20

394.21

68.74

Add: Normative loan during the year

56.91

65.43

86.20

Less: Normative repayment (10 % of 1)

8.82

39.42

6.87

Closing normative loan (1+2-3)

136.29

420.22

148.07

Average normative loan (1+4) * 0.5

112.25

407.21

108.40

Rate of interest (SBI PLR)

8.49%

14.75%

14.61%

Interest on normative loan

9.53

60.06

15.84

Financing Charges

0.80

1.87

Total Interest and Finance Charges

10.33

61.93

17.71

Therefore, the Commission approves interest and finance charges of Rs. 17.71 crore in

the True-up for the FY 2012-13.

4.13. Interest on Security Deposit

Petitioner’s Submission:

Regulation 25 of Tariff Regulations, 2009 read along with Clause 47(4) of the Electricity

Act, 2003 provides for Interest on Security Deposit, if any, made by the consumer with the

licensee.

An amount of Rs. 0.23 crore have been claimed as actual interest paid to the consumers

on security deposits for the FY 2012-13.

Commission’s Analysis:

The Commission has verified the submission from the audited accounts and observed

that the Petitioner has provisioned an amount of Rs. 1.62 crore and Rs. 2.88 crore against

interest on security deposit for the FY 2011-12 and FY 2012-13 respectively and the

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cumulative amount of Rs. 4.50 crore has been shown as current liability in the balance

sheet of FY 2012-13. Further, there is no mention of Rs. 0.23 crore in the audited accounts

of the FY 2012-13.

The Commission has computed the interest amount due for the payment by applying the

bank rate on average security deposit available as follows:

Table 4.15: Interest on Security Deposit approved by the Commission in the True-up

of FY 2012-13 (Rs. crore)

S. No.

Particulars

Approved in APR

Order dated

31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Opening Security Deposit

62.57

90.58

Add: Deposits during the Year

9.19

21.54

Less: Deposits refunded

1.52

5.54

Closing Security Deposit

70.24

106.58

Average Security Deposit

66.41

98.58

Bank Rate

9.50%

Interest on Security Deposit (Due)

5.94

9.36

Interest on Security Deposit

(Actually Paid)

0.23

0.00

Balance to be paid to the consumers

5.94

9.13

9.36

Considering the fact that there is no interest payout in actuals, the Commission has not

approved any interest on security deposit in the True-up of the ARR for the FY 2012-13. The

Commission directs the Petitioner to pay the balance interest on consumer security deposit

of Rs. 9.36 crore in the FY 2017-18.

4.14. Return on Capital Base

Petitioner’s Submission:

EDG being an integrated Utility, it is entitled to return on capital base under the

provisions of Schedule VI of the repealed Electricity (Supply) Act, 1948 vide provision

under Regulation 23 of Tariff Regulations, 2009. EDG has calculated the return on capital

base at 3%. The Commission is requested to kindly allow the return on Net Fixed Assets

(NFA) amounting to Rs. 15.27 crore for the FY 2012-13.

Commission’s Analysis:

Being an integrated utility, EDG is entitled to return on capital base as per Regulation 23

of the Tariff Regulations, 2009. Hence the Commission approves return on capital base on

the basis of GFA and cumulative depreciation as on 01^st April, 2012 as submitted by the

Petitioner and as verified from the audited accounts as per the following Table:

Table 4.16: Return on Capital Base approved by the Commission in the True-up

of FY 2012-13 (Rs. crore)

Sr.

No.

Particulars

Approved in APR Order

Dated 31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Gross block at beginning of the FY

126.00

693.69

Less: Opening accumulated

depreciation

3.33

184.63

Net block at beginning of the FY

(1-2)

122.67

509.06

Less: Opening accumulated

consumer contribution

0.00

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Net fixed assets at beginning of the

FY (3-4)

122.67

509.06

Return @3% of NFA

3.68

15.27

Therefore, the Commission approves Return on Net Fixed Assets (NFA) of Rs. 15.27 crore

in the True-up for the FY 2012-13.

4.15. Interest on Working Capital

Petitioner’s Submission:

Interest on Working Capital has been claimed in accordance with Regulation 29 of the

Tariff Regulations, 2009. Further, the closing balance of the security deposit has been

deducted from the total normative Working Capital requirement for computing the

Working Capital requirement as per the methodology followed by the Commission in its

previous Tariff Order.

Commission’s Analysis:

As per Regulation 29 of the Tariff Regulations, 2009:

“(3) Subject to prudence check, the working capital for integrated utility shall be the sum of

one month requirement for meeting:

a. Power purchase cost.

b. Employees cost.

c. Administration & general expenses.

d. Repair & Maintenance expenses.

e. Sum of two month requirement for meeting Fuel cost.

5) The rate of interest on working capital shall be equal to the short term Prime Lending

Rate of State Bank of India on the 1^st April of the relevant financial year. The interest on

working capital shall be payable on normative basis notwithstanding that the

generating company/licensee has not taken working capital loan from any outside

agency or has exceeded the working capital loan amount worked out on the normative

figures.”

The Commission has considered the calculation of the different components of the

Working Capital on the basis of the above-stipulated norms. The Commission has

deducted average consumer security deposit from the Working Capital requirement

considered for True-up of ARR for the FY 2012-13. The Commission has considered the

SBI PLR as applicable on 01^st April, 2012. (https://www.sbi.co.in/portal/web/interest-

rates/benchmark-prime-lending-rate-historical-data)

The detailed calculations of the interest on the Working Capital are as mentioned in the

Table below:

Table 4.17: Interest on Working Capital approved by the Commission in the True-up

of FY 2012-13 (Rs. crore)

S. No.

Particulars

Approved in APR

Order dated

31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Power Purchase Cost for

one month

71.66

87.10

Employee Cost for one

month

11.37

12.89

A&G Expenses for one

month

0.72

1.86

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R&M Expenses for one

month

1.55

1.60

Total Working Capital for

one month

85.29

103.44

Security Deposit (amount

with EDG)

70.24

90.58

98.58

Total borrowing for

Working Capital

considered for one month

15.05

12.86

4.86

SBI PLR Rate (%)

14.75%

Interest on Working

Capital

2.22

1.90

0.72

Therefore, the Commission approves Rs. 0.72 crore as Interest on Working Capital in the

True-up for the FY 2012-13.

4.16. Provision for Bad and Doubtful Debts

Petitioner’s Submission:

The Commission has stated in the Tariff Order that bad and doubtful debts actually

written off, limited to 1% as per the Regulations, would be considered only after the

availability of audited accounts and would be taken up at the time of the True-up of the

ARR. Accordingly, based on the audited accounts, bad and doubtful debts actually

written off in the ARR amount to Rs. 2.63 crore in the FY 2012-13.

Commission’s Analysis:

As specified in Regulation 28 of the Tariff Regulations, 2009 (to be read with the format):

“The Commission may, after the generating company/licensee gets the receivables audited,

allow a provision for bad debts up to 1% of receivables in the revenue requirement of the

generating company/licensee.”

It is observed that as per the audited accounts, the licensee has not written off any

amount in the FY 2012-13. Therefore, the Commission does not approve any amount

under the provision of bad and doubtful debts.

4.17. Non-Tariff Income

Petitioner’s Submission:

Non-Tariff Income of Rs. 13.57 crore has been claimed in the True-up of the FY 2012-13.

Commission’s Analysis:

The Commission has verified the submission of the Petitioner from the audited accounts

and found the same to be correct. Hence, the total Non-Tariff Income is Rs. 13.57 crore for

the FY 2012-13 as per the audited accounts, which is approved by the Commission as

follows:

Table 4.18: Non-Tariff Income approved by the Commission in the True-up of

FY 2012-13 (Rs. crore)

Particulars

Approved in the

Tariff Order Dated

28^th April, 2016

Petitioner's

submission

(True-up)

Approved by the

Commission (As

per audited A/c)

(True-up)

Sale Proceeds of dead stock, waste paper etc.

23.06

0.31

Receipt from State Electrical Inspectorate

0.23

Misc. Receipts/income

8.02

Meter/service rent

3.73

Deferred Income (Electricity Development fund)

1.26

Gross Total

23.06

13.57

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Therefore, the Commission approves the Non-Tariff Income of Rs. 13.57 crore for the

FY 2012-13.

4.18. Revenue from Sale of Surplus Power/Unscheduled Interchange (UI)

Petitioner’s Submission:

Revenue from the sale of surplus power is Rs. 32.77 crore for the FY 2012-13 against the

corresponding approved amount of Rs. 6.11 crore for the FY 2012-13.

Commission’s Analysis:

The Commission has analyzed the submission made by the Petitioner regarding the sale

of surplus power in the Exchange plus UI sales from the audited accounts and found that

the Petitioner has received the following revenue from the sale of surplus power in the

Exchange and UI in the FY 2011-12 and FY 2012-13 respectively:

Table 4.19: Revenue from Sale of surplus power approved by the Commission in the True-up

of FY 2012-13 (Rs. crore)

Revenue Source

Petitioner's

submission

(True-up)

Approved by the Commission

(As per audited A/c)

(True-up)

Through sale in Power Exchange

12.08

Through sale in UI

20.68

Total Revenue from sale of Surplus Power

32.77

Therefore the Commission approves the revenue from sale of surplus power of Rs. 32.77

crore in the True-up for the FY 2012-13.

4.19. Revenue at approved Retail Tariff

Petitioner’s Submission:

The revenue from Tariff was Rs. 973.58 crore for the FY 2012-13.

Commission’s Analysis:

The Commission has verified revenue from the sale of power within the State in the FY

2012-13 from the audited accounts.

The category-wise revenue as submitted by the Petitioner and approved by the

Commission is shown in the Table below:

Table 4.20: Revenue from Retail Sale power approved by the Commission in the True-up of

FY 2012-13 (Rs. crore)

Sr.

No.

Particulars

FY 2012-13

Approved in APR Order

Dated 31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

A. LOW TENSION SUPPLY

261.22

301.16

(a) LTD/Domestic

144.00

150.70

(b) LTD/L.I.G.

0.38

1.05

1.00

1.33

LTC/Commercial

76.00

104.83

(a) LTP/Motive Power

30.00

24.10

(b) LTP Mixed (Hotel Industries)

2.06

2.83

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0.00

2.37

LTAG/Agriculture

2.23

2.31

(a) LTPL (Public lighting)

4.78

10.61

(b) Arrears

0.05

LTPWW/Public Water works

0.77

0.99

B. HIGH TENSION SUPPLY

667.11

657.03

HT (Mixed)

102.58

47.18

HTI (Industrial) Ferro

Metallurgical/ Steel

Melting/Power Intensive

198.00

195.66

HTI Industrial

238.84

242.27

HTAG (Agriculture)

0.75

1.20

EHTI (Industrial)

57.63

55.50

HT P.W.W. & Sewage system

35.14

57.76

HT. M.E.’s Defense Estt.

11.72

9.61

HTI (Steel Rolling)

20.00

24.87

HTI/IT High Tech

2.45

15.58

HTI/Ice Manufacturing

0.00

0.18

(a) Sale from EDG to GSPL (Div.

VII)

1.57

Sale to MSEDCL (Div. VI)

-0.05

HTI Hotel Industry

5.72

C. TEMPORARY SUPPLY

10.95

15.11

(a) L.T. Temporary

10.32

14.27

(b) H.T. Temporary

0.63

0.84

Arrears under RRC (with No. of

cases)

0.27

FPPCA charge

33.03

0.00

Gross Total

972.31

973.58

Therefore, the Commission approves the revenue from sale of power at Rs. 973.58 crore

in the True-up for the FY 2012-13.

4.20. Aggregate Revenue Requirement (ARR)

Petitioner’s Submission:

The Net Aggregate Revenue Requirement as approved by the Commission in the Review

of the ARR for the FY 2012-13 was Rs. 1,031.99 crore. Based on the True-up submissions

for the FY 2012-13, the Commission is requested to approve an ARR of Rs. 1,312.36 crore.

Commission’s Analysis:

The Commission on the basis of the detailed analysis of the cost parameters of the ARR

has considered and approved the revenue requirement in the True-up of the FY 2012-13 at

Rs. 1,264.10 crore as given in the following Table:

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Table 4.21: Net ARR approved by the Commission in the True-up of FY 2012-13 (Rs. crore)

No.

Particulars

FY 2012-13

Approved in APR

Order dated

31-03-2013

Petitioner's

Submission

(True-up)

Approved by the

Commission

(True-up)

Cost of power purchase for full year

866.01

1,045.22

Employee costs

136.44

154.63

Administration and General Expenses

8.59

22.27

Repair and Maintenance Expenses

18.55

19.16

Depreciation

8.80

35.45

Interest and Finance charges

10.33

61.93

17.71

Interest on Working Capital

2.22

1.90

0.72

Interest on Security Deposit

5.94

0.23

Return on NFA

3.68

15.27

Provision for Bad Debt

2.62

Other Expenses

0.60

Total Revenue Requirement

1,061.17

1,358.69

1,310.43

Less: Non-Tariff Income

23.06

13.57

Less: Revenue from Surplus Power

Sale/UI

6.11

32.77

Net Revenue Requirement

1,031.99

1,312.36

1,264.10

4.21. Revenue Gap/(Surplus)

Petitioner’s Submission:

The entire gap for the FY 2012-13 was committed to be funded by the Government of Goa

by way of budgetary support. A letter from the Government of Goa was also submitted

wherein the Government of Goa had assured that it would provide requisite budgetary

support to meet the deficit at the existing tariff for the FY 2012-13. In view of the

budgetary support for FY 2012-13 from the Government of Goa, there is no net revenue

gap for FY 2012-13.

Accordingly, the revenue gap of Rs. 338.78 crore for the FY 2012-13, has not been carried

forward and will be met through the budgetary support as proposed in the earlier

submission.

Commission’s Analysis:

The Commission has analyzed and approved the Revenue Gap/(Surplus) as follows:

Table 4.22: Revenue Gap/(Surplus) approved by the Commission in the True-up

of the FY 2012-13 (Rs. crore)

Sr.

No.

Particulars

FY 2012-13

Approved in APR Order

Dated 31-03-2013

Petitioner's

Submission

(True-up)

Approved by

the Commission

(True-up)

Net Revenue Requirement

1,031.99

1,312.36

1,264.10

Revenue from Retail Sales at

Existing Tariff

970.94

973.58

Net Gap/(Surplus)

61.05

338.78

290.52

Budgetary Support from

Government

61.05

338.78

290.52

Net Final Revenue Gap/(Surplus)

The Petitioner has submitted that the entire gap for the FY 2012-13 is committed to be

funded by the Government of Goa by way of budgetary support. The Petitioner in this

regard has also earlier submitted the letter from the Government of Goa wherein it has

assured that it would provide requisite budgetary support to meet the deficit at the

existing tariff for the FY 2012-13. In view of the budgetary support for the FY 2012-13

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from the Government of Goa, the Commission approves Nil net revenue gap in the

True-up for the FY 2012-13.

Chapter 5. True-up of the FY 2013-14, FY 2014-15 and FY 2015-16

5.1. Applicable provisions of JERC for the State of Goa and Union Territories (Terms and

Conditions for Determination of Tariff) Regulations, 2009

The True-up of the previous years is to be carried out as per Regulation 8 (2) of the Tariff

Regulations, 2009:

(2) (i) After audited accounts of a year are made available, the Commission shall undertake

similar exercise as above with reference to the final actual figures as per the audited

accounts. This exercise with reference to audited accounts shall be called ‘Truing Up”.

(ii) The Truing Up for any year will ordinarily not be considered after more than one year of

‘Review’.

(3) The revenue gap of the ensuing year shall be adjusted as a result of review and truing

up exercises.