BEFORE  THE  MAHARASHTRA  ELECTRICITY  REGULATORY COMMISSION,  MUMBAI.

Case  No.  68  of  2006

In the matter of

FULL NAME HERE                                                        - Concerned Citizen

Vs.

Maharashtra State Power Generation Company Ltd.                 - Respondent

Determination of Annual Revenue Requirement (ARR) and Multi Year Tariff (MYT)

for the First Control Period (FY 2007-08 upto FY 2009-10) of

the Maharashtra State Power Generation Company Ltd. (MSPGCL).

AFFIDAVIT  REPLY

I have purchased a copy of proposal of MSPGCL, which has been submitted for your kind approval to determine the ARR and approve the MYT for First Control Period (FY 2007-08 up to 2009-10).

As a concerned citizen, I have purchased a copy of the Petition document as per MSPGCL’s Public Notice which appeared in Times of India dt  6-2-2007. I would also like to be heard in person at the Public Hearing, presently scheduled for 28-2-2007.

The following queries are to be addressed before the grant of approval of this ARR and finalization of the Tariff Schedule:

1. Please refer the following Tables, as submitted on Page nos. (iv) to (vi) of the Petition copy:

1. Annual Fixed Cost Projections for MSPGCL
2. Variable Cost Projections for MSPGCL
3. Total Cost Projections for MSPGCL
4. Aggregate Revenue Requirement of MSPGCL for existing stations

The data provide in these above tables, is for the years FY 2005-06 to FY 2009-10. Data in the same format is required for the preceding three Financial Years, i.e. FY 2002-03, FY 2003-04 and FY 2004-05.

Also, all the tables shown in the Newspaper Public Notice, and mentioned below, data for each of the preceding three Financial Years, i.e. FY 2002-03, FY 2003-04 and FY 2004-05 is required. These tables are:

1. Table 1: ARR
2. Table 2.1: Trajectory of Availability and PLF
3. Table 2.2: Trajectory of SHR and Aux. Consumption
4. Table 2.3: Trajectory of Sec. Fuel Cons and Transit Loss
5. Table 3: Station-wise FC and VC of Generation (Rs/ kWh)
6. Table 4: Net Generation (in MU)
7. Table 5: Capacity Addition Plan (figs. In L)

2. The newspaper Ad Table 5: Capacity Addition Plan is not given in the soft copy. It has been very cumbersome to compile and correlate that data. The Commission must penalize MSPGCL for not providing data in appropriate format to the Public.  A public apology must be given and MSPGCL’s defaulting officers must be fined.

3. As per proposed Capacity Addition Plan in Table5 of the Newspaper Ad:

The increase in capital expenditure seems disproportionate to the increase in capacity. While capex is going up 684%, net generation added is only 8.7%. This is inspite of the fact that all the expansion projects for which capex is proposed is scheduled to be commissioned within the First Control Period itself. The Commission is to explain why MSPGCL should be allowed to expend these amounts when there is no apparent benefit even envisaged, in the short term.

4. On Page 11, it is mentioned that extension was granted in condonation of delay in filing this MYT, which was filed on 1-1-2007 and admitted on 31-1-2007.  As per the Commission’s regulations, the tariff should have been filed 120 days before date of implementation, which is 1-4-2007. Which means MYT petition should have been filed on 30-11-2006. However, MSPGCL had asked for an extension upto 1-1-2007, which it received.
   
   The manner in which these MYT petitions are being pushed through is really suspect. This leaves only 59 days before implementation, during which time the Technical Validations and Public Hearings have to be completed. The Commission must publish its Rules and Regulations governing issue of Public Notice and time frame to be given to public for actually hearing them – maybe even, more than once if required. What was the reason for the delay? On what grounds was extension granted? The Commission needs to make these records public, as per its own Regulations.

5. On Page 13, 4 new projects have been planned during Phase I (or the First Control Period):

1. New Parli TPS Unit 2
2. Paras TPS Expansion Unit 2
3. Khaparkheda TPS Expansion Project
4. Bhusawal TPS Expansion

Details for each of the above are required are as follows:

1. What was the Total capex approved for each project/unit?
2. What was the date of approval?
3. What was the date (month/year) of completion envisaged at the start of these projects?
4. Year-wise capex expenditure details required for each.
5. What is the rated life of each of these?

6. The implementation of the provisional transfer scheme under Section 131 (5)(g) of the Electricity Act 2003 (EA 2003) had commenced on 6-6-2005, but has not yet been completed, even though 21 months have passed. When is it likely to be completed? At what stage is the scheme, presently? Why is there a delay?

7. On Page 15, point (d), the transit loss of coal is considered at the same rate as determined by the Commission, for Reliance Energy, at 1.79%. What are the comparable rates for similar generation companies across the country? Details of such Transit Loss percentages required for at least 5 different companies, across the country, for the past 5 years.

8. On Page 16, in continuation of (d), why should transit loss be considered an “uncontrollable factor”? Commission to provide detailed explanation. By this logic, all expenses would be “uncontrollable”.

9. On Page 16, point (e), again water charges, lubricants and other consumables have again been asked to be treated as “uncontrollable factors.” Commission to seek better justification for deeming such expenses to be “uncontrollable.”

10. On Page 85-86, Tables 4.7-4.10: Technical Parameters for Hydro Complexs, preceding three years’ data required (FY 2002-03, FY 2003-04 and FY 2004-05). What is the reason for drop in Net Generation? Also, explanation required as to why these figures do not tally with the figures reproduced on Page 476.

11. On Page 87, second para, there is a reference to “Annexure 7”, which is missing in the paper book MYT Petition. Commission to submit a copy of this Annexure.

12. On Page 87, last para mentions that MSPGCL is “making efforts to maximize their availability.” MSPCL to give full details of steps being taken, with timelines and report on progress done, thus far. In the absence of which, these are only empty words.

13. On Page 90, point (iii) Peak and Off-Peak Tariffs, on what basis has the computation of Rs. 1.65 per kWh been done? Why is peaking tariff assumed at 20% higher? The bases for these assumptions need to be brought out clearly. In the absence of any rational explanation, the entire exercise would seem to be an arithmetical one, without any realistic basis.
    
    Also, why has the Generation from Small Hydro Plants / Other Hydro Plants not been considered under estimated generation during peak hours?
    
    A Generation report for each time-slot of the day (in MU) of each of these Hydro Plants, including SHP/OHP to be given in the following format (monthly data):

MONTH:  JAN 2006 to DEC 2006 (each months’ data in a separate table)

14. On Page 93, there is a refernce to “Annexure 8”, this seems to be missing in the paper Book copy.

15. On Page 330, Hydro Stations, the totals of the columns don’t seem to be adding up to the summation given in the last row. This needs to be explained.

16. On Page 442, para 13, it is mentioned that delay on the part of the EPC (BHEL) caused a delay in the synchronization of the New Parli TP Unit 1 and Paras TPS Unit 1. It states, “BHEL could not supply the materials in time leading to delay in commissioning of the units. There have also been delays from suppliers of Balance of Plant for the units.”
    Detailed information is required on:

1. Why did BHEL delay in making deliveries?
2. Were the materials ordered to BHEL on time?
3. What action has MSPGCL taken against BHEL 9for the delay), and/or against its own employees (if found to be erring)?
4. Does MSPGCL have a Late Delivery (LD) penalty clause with BHEL? What is the nature (and amount) of the LD clause? Did MSPGCL invoke LD clause? If not, why? Copy of Agreement to be put on record.
5. It is mentioned that there is a Bank Guarantee (BG). What is the value of the BG? What is the value of the plant cost? Did MSPGCL invoke the BG? If not, why not?
6. Who were the other suppliers, who also delayed this? What was the value of the supplies that they were to make? Why were these supplies late? What action has been taken? Was there any LD clause or BG with these suppliers? What was the value of the LD and/or BG? Was it invoked? If not, why not?

In the absence of the above information, there is no transparency in the functioning of MSPGCL and such “lapses” and delays would continue. The Commission to ensure that MSPGCL puts all this data on record.

17. On Page 447, point 23, it is mentioned that MSPGCL will submit a report on weightometers, by end January 2007. Commission to confirm whether such a report has been submitted, and if yes, what the findings of the report are.

18. On Page 452, Table 4.5: Comparison of O&M Projections for 2006-07. Detailed reasons to be given as to why these expenses have deviated from the values approved by the Commission.

19. On Page 455, point 32, MSPGCL to define what exactly is meant by “normal monsoon.” Quantitative and substantiative data to be provided while explaining this. MSPGCL to also declare (based on the explanations given) as to what is the extent of “normalcy” of the monsoons over the past years, viz, FY 2002-03, FY 2003-04, FY 2004-05, FY 2005-06 and FY 2006-07.  

It is noticed that at many places the data has been corrected, revised or otherwise rectified. When handing over the paper Book edition to the Public, all such changes need to be mentioned right at the start.

The public otherwise will have to read through the entire data and then try and figure out for himself/herself as to which tables have been revised or changed, which could result in misinterpretation of data.  When a table has been recast or corrected, it needs to be mentioned upfront and in a bold, attention-grabbing manner.

It seems that MSPGCL and the Commission are just rushing through this MYT tariff process, merely for the sake of completion of formalities. There is no real interest in giving time to the Public, nor for hearing their suggestions. Such tactics deprive the Commission as well as the Public of sufficient time to seek all answers before being satisfied that consumer interest has been adequately watched as required by law and the Regulations.

There may also be lacunae in the data provided and hence there may be rejoinders, so sufficient time, for example, a period of 60 days, should be given, before the Commission calls for a public hearing on this issue.

Before me                                                                        FULL NAME HERE

Mumbai                                                                         (Deponent)

VERIFICATION

                I, FULL NAME HERE , of Mumbai, with address FULL POSTAL ADDRESS HERE , do hereby solemnly affirm and say that what is stated in the foregoing affidavit is true and I believe the same to be true.

Solemnly declared at Mumbai on                                        FULL NAME HERE

this                  day of                 2007

                                                                     Before me :