Ref. : ER/Press/’03/gebfuel.57/sam-DG

CERS Opposes GEB’s Plea for Fuel Cost and Power Purchase Adjustment Charges

Consumer Education and Research Society (CERS), Ahmedabad, in its latest submission to the Gujarat Electricity Regulatory Commission (GERC), has urged it to turn down the Gujarat Electricity Board (GEB)’s application for approval of fuel cost and power purchase adjustment charges. In its earlier submissions before the Commission, CERS had highlighted how the power generating utilities misused the fuel cost adjustment formula to cover their inefficient and uneconomical operations.

CERS has already filed a petition before the GERC on 11 January 2001 challenging the Power Purchase Agreements (PPAs) signed between individual power producers (IPPs) and the GEB under Case No. 38/2001. The GEB has to pay a heavy amount of Rs 120 crore per month as fixed costs to the IPPs, at times without purchasing a single unit from them. The cost of power generation per unit has dropped due to variable costs as most of the IPPs have shifted from naphtha to natural gas, but the fixed costs remain the same, CERS explained.

The GEB paid a sum of Rs 138.9 crore per month as fixed cost to the IPPs during 2000-2001, Rs 127.7 crore during 2001-2002, Rs 133 crore (provisional) in 2002-2003, and Rs 114.8 crore (projected) per month for 2003-2004. CERS requested the GERC to direct the GEB to provide data of fixed costs and variable costs paid to the IPPs from April to November 2003. This will highlight the involvement of fixed cost when no power is purchased from the IPPs for a particular month, CERS contended.

CERS has urged upon GERC to direct the GEB to provide details of coal received and consumed and the short supply received for 2001-2002, 2002-2003 and up to November 2003. The amount received from the sale of fly ash and coal rejects for this period should also be mentioned, CERS requested.

CERS has submitted that the GEB has collected a huge amount as fuel cost adjustment charges from electricity consumers of Gujarat. Before the GERC’s approval of the GEB’s plea, the Commission is urged upon to hear domestic, industrial, commercial and agricultural consumer groups’ representatives.

Date : 29/12/2003
Place : Ahmedabad

D. Gupta
Associate Editor
INSIGHT -The Consumer Magazine

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CONSUMER EDUCATION AND RESEARCH SOCIETY
“Suraksha Sankool”, Thaltej, Sarkhej-Gandhinagar Highway,
Ahmedabad- 380 054 (INDIA)
Phone: 079-7489945-46 Fax: 079-7489947
E-mail: cerc@wilnetonline.net
Web Site: http://www.cercindia.org
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