Draft First Amendment to the APERC Terms and Conditions for Tariff Determination from Renewable Energy Sources Regulation 2025 – EQ
Summary:
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### **1. Background & Filing**
– **Petitioner**: APTRANSCO
– **Case No.**: O.P. No. 72 of 2024
– **Period**: 4th Control Period (FY 2019-20 to FY 2023-24)
– **Filing Date**: 30.09.2024
– **Public Hearing**: Held on 09.07.2025 after public notice and stakeholder consultations.
### **2. APTRANSCO’s Claim**
– APTRANSCO claimed a **true-down (revenue surplus)** of **₹902.94 crore** for the 4th Control Period.
– Additionally, claimed **₹156.81 crore** due to depreciation methodology difference (Companies Act vs APERC norms).
– **Total claimed true-down**: **₹1,059.75 crore** to be refunded to DISCOMs.
### **3. Stakeholder Objections (Key Concerns)**
– **Inflated Tariffs & Capital Expenditure (CapEx) Shortfall**: Approved Regulated Rate Base (RRB) was ₹50,341 crore, but actual RRB achieved was ₹37,863 crore – a shortfall of ₹12,478 crore.
– **Unfair True-Down Practice**: True-up (additional revenue claim) is passed to consumers immediately, but true-down (excess revenue) is determined only at the end of the control period.
– **High O&M Costs**: Significant increase due to pension liabilities (₹1,397 crore).
– **Lack of Transparency**: Non-compliance with disclosure norms.
– **COVID-19 Impact**: Cited as reason for CapEx shortfall and project delays.
### **4. APTRANSCO’s Defense**
– **COVID-19 Impact**: Lockdowns led to non-completion of projects, but no adverse impact on power supply.
– **Pension Liability**: Mandatory provision as per regulations.
– **Non-Tariff Income**: Increased due to one-time supervisory charges from bulk consumers.
– **Compliance**: Claimed adherence to regulations and website disclosures.
### **5. APERC’s Analysis & Decisions**
#### **a) Operation & Maintenance (O&M) Costs**
– **Filed**: ₹6,175.19 crore
– **Normative Allowance (as per APERC norms)**: ₹4,253.27 crore
– **Pension Liability Allowed**: ₹1,472.27 crore (actual deposited in trusts)
– **Total Allowed O&M**: ₹5,725.52 crore
– **Disallowed**: ₹449.67 crore
#### **b) Depreciation**
– **Filed**: ₹3,747.23 crore
– **Approved**: ₹3,743.99 crore
– **Minor adjustment**: ₹3.24 crore disallowed
– APTRANSCO directed to follow APERC depreciation norms.
#### **c) Taxes**
– **Filed**: ₹370.83 crore
– **Approved**: ₹443.25 crore (including tax on non-tariff income as per APTEL order)
– **Difference**: ₹72.42 crore allowed.
#### **d) Return on Capital Employed (ROCE)**
– **Filed**: ₹3,985.87 crore
– **Approved**: ₹3,845.69 crore
– **Reduction**: ₹140.18 crore due to lower cost of debt and asset base.
**e) Revenue & Non-Tariff Income**
– **Total Revenue Approved**: ₹13,400.91 crore (vs ₹14,689.78 crore filed)
– **Non-Tariff Income Approved**: ₹1,116.02 crore (vs ₹1,134.40 crore filed)
– Reduction mainly due to pass-through of earlier true-down amounts to DISCOMs.
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