TariffApr 2315 PDF

Order on
True up for FY 2016-17,

Annual Performance Review for FY
2017-18
&
ARR for FY 2018-19
For
Uttarakhand Power Corporation Ltd.
March 21, 2018
UTTARAKHAND ELECTRICITY REGULATORY COMMISSION

Vidyut Niyamak Bhawan,
Near I.S.B.T., P.O. Majra, Dehradun – 248171
Table of Contents
1. Background and Procedural History..................................................................................................4

2. Stakeholders’Objections/Suggestions, Petitioner’s Responses and Commission’s Views ....8
2.1 General ............................................................................................................................................ 8
2.2 Overall Tariff Increase ................................................................................................................. 9
2.3 Domestic Tariff ............................................................................................................................ 11
2.4 Non-Domestic Tariff ................................................................................................................... 12
2.4.1 Tariff Hike ...................................................................................................................................... 12
2.5 Agricultural Tariff ....................................................................................................................... 13
2.6 Agriculture Allied Activities ..................................................................................................... 15
2.7 Industrial Tariff ........................................................................................................................... 16
2.7.1 Tariff Hike ...................................................................................................................................... 16
2.8 Time of Day Tariff ....................................................................................................................... 19
2.8.2 Load Factor based Tariff ............................................................................................................... 20
2.9 Fuel Charge Adjustment ............................................................................................................. 22
2.10 Minimum Consumption Guarantee (MCG)............................................................................. 23
2.11 Rebate and Incentives ................................................................................................................. 25
2.12 Energy Sale Forecast ................................................................................................................... 28
2.13 Cost of Supply and Cross Subsidy ............................................................................................ 30
2.14 Continuous Supply ...................................................................................................................... 30
2.15 Components on ARR and Revenue ........................................................................................... 32
2.15.1 Power Purchase Cost .................................................................................................................... 32
2.15.2 Return on Equity ........................................................................................................................... 36
2.15.3 Operation & Maintenance Expenses ........................................................................................... 38
2.15.4 Interest and Finance Charges ....................................................................................................... 39
2.15.5 Depreciation ................................................................................................................................... 40
2.15.6 Non Tariff Income ......................................................................................................................... 40
2.16 Consumer Security Deposit........................................................................................................ 41
2.16.2 Sharing of Gains & Losses ............................................................................................................ 43
2.16.3 Provision for Bad and Doubtful Debts ....................................................................................... 44
2.17 Capital Expenditure .................................................................................................................... 45
2.18 Truing-up for Past Years ............................................................................................................ 47
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2.19 Distribution Losses .....................................................................................................................48
2.20 Departmental Employees............................................................................................................52
2.21 Tariff for Cane Crushers..............................................................................................................54
2.22 Metering and Billing ....................................................................................................................54
2.23 Temporary Connections ..............................................................................................................58
2.24 KCC Data ......................................................................................................................................58
2.25 Quality of Power .........................................................................................................................59
2.26 Railway Traction.........................................................................................................................60
2.27 Open Access ..................................................................................................................................64
2.28 Collection Efficiency ...................................................................................................................68
2.29 Promotion of Renewable Energy ...............................................................................................68
2.30 Miscellaneous Comments ...........................................................................................................70
2.30.1 Terms and Conditions for Seasonal Industries (RTS-7) ........................................................... 70
2.31 Views of State Advisory Committee: ........................................................................................71
3. Petitioners’s Submissions, Commission’s Analysis, Scrutiny and Conclusion on Truing-up
for FY 2016-17 ................................................................................................................................................. 75
3.1 Impact of Change in Financing from FY 2012-13 to FY 2015-16............................................75
3.2 Truing-up for FY 2016-17 ............................................................................................................77
3.2.1 Sales ................................................................................................................................................. 78
3.2.2 Distribution Losses ........................................................................................................................ 85
3.2.3 Power Purchase Expenses (Including Transmission Charges) ............................................... 86
3.2.4 Operation and Maintenance (O&M) Expenses .......................................................................... 92
3.3 Cost of Assets and Financing .....................................................................................................99
3.3.1 Capital cost of Original Assets ..................................................................................................... 99
3.3.2 Financing of Capital Cost ........................................................................................................... 101
3.3.3 Provisions for Bad and Doubtful Debts .................................................................................... 106
3.3.4 Interest on Working Capital (IoWC) ......................................................................................... 108
3.3.5 Return on Equity.......................................................................................................................... 109
3.3.6 Non Tariff Income ....................................................................................................................... 110
3.4 Tariff Revenue ............................................................................................................................112
3.5 Sharing of Gains and Losses ....................................................................................................116
3.6 ARR and Revenue for FY 2016-17 ............................................................................................119
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4. Petitioner’s Submissions, Commission’s Analysis, Scrutiny and Conclusion on Annual
Revenue Requirement for FY 2018-19 ......................................................................................................120
4.1 Background................................................................................................................................. 120
4.2 Sales............................................................................................................................................. 122
4.3 Distribution Loss Trajectory ................................................................................................... 127
4.4 Aggregate Revenue Requirement ............................................................................................. 132
4.5 Power Purchase Cost ................................................................................................................ 133
4.5.1 Power Purchase from UJVN Ltd. .............................................................................................. 137
4.5.2 Power Purchase from NHPC Ltd. ............................................................................................. 138
4.5.3 Power Purchase from THDC India Ltd. ................................................................................... 139
4.5.4 Power Purchase from NTPC Ltd. .............................................................................................. 140
4.5.5 Power Purchase from SJVN Ltd. ............................................................................................... 141
4.5.6 Power Purchase from NPCIL Stations ...................................................................................... 141
4.5.7 Power Purchase from existing Renewable Energy Sources ................................................... 142
4.5.8 Power Purchase from Vishnu Prayag HEP and GVK Srinagar (State Royalty Power) ..... 142
4.5.9 Power Purchase from Sasan UMPP .......................................................................................... 142
4.5.10 Power purchase from State Gas Generating Station ............................................................... 143
4.5.11 Power purchase from Greenko Budhil Hydro ........................................................................ 143
4.5.12 Power purchase from upcoming generating stations............................................................. 144
4.5.13 Energy available from Firm Sources ......................................................................................... 145
4.5.14 Power Purchase for fulfilling RPO ............................................................................................ 145
4.5.15 Deficit/ (Surplus) energy ........................................................................................................... 147
4.5.16 Cost of power purchase .............................................................................................................. 147
4.6 Cost of Meeting RPO Target ................................................................................................... 156
4.7 Transmission Charges .............................................................................................................. 157
4.7.1 Inter-State Transmission Charges payable to PGCIL ............................................................. 157
4.7.2 Intra-State Transmission Charges payable to PTCUL ............................................................ 157
4.7.3 Transmission Charges ................................................................................................................. 157
4.8 SLDC Charges ............................................................................................................................ 158
4.9 GFA and Additional Capitalisation ...................................................................................... 158
4.9.1 GFA base for FY 2017-18 and FY 2018-19 ................................................................................. 158
4.10 Means of Finance ....................................................................................................................... 162
4.11 Interest and Finance Charges................................................................................................... 162
4.11.1 Depreciation ................................................................................................................................. 165
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4.11.2 Operation and Maintenance expenses ...................................................................................... 166
4.11.3 Employee Expenses ..................................................................................................................... 168
4.11.4 R&M Expenses ............................................................................................................................. 172
4.11.5 A&G Expenses ............................................................................................................................. 173
4.11.6 O&M Expenses............................................................................................................................. 176
4.11.7 Interest on Working Capital ....................................................................................................... 176
4.11.8 Capital required to finance shortfall in collection of current dues ....................................... 178
4.11.9 Adjustment for security deposits and credit by power suppliers......................................... 178
4.11.10 Return on Equity.......................................................................................................................... 179
4.11.11 Income Tax ................................................................................................................................... 180
4.11.12 Provision for Bad and doubtful debts....................................................................................... 180
4.11.13 Non-Tariff Income ....................................................................................................................... 182
4.11.14 Adjustment of revenue from Free Power ................................................................................. 182
4.11.15 Treatment of past year adjustments .......................................................................................... 183
4.11.16 Revenue Requirement for FY 2018-19....................................................................................... 184
4.11.17 Revenue at Existing Tariff .......................................................................................................... 184
4.11.18 Revenue Gap for FY 2018-19 at existing Tariff ........................................................................ 185
5. Tariff Rationalisation, Tariff Design and Related Issues ......................................................... 187
5.1 Tariff Rationalisation and Tariff Design for FY 2018-19 ....................................................187
5.1.1 General .......................................................................................................................................... 187
5.1.2 Petitioner’s Proposals .................................................................................................................. 187
5.1.3 Commission’s Views on Tariff Rationalisation Measures ..................................................... 190
5.1.4 Treatment of Revenue Gap ........................................................................................................ 211
5.1.5 Cross Subsidy ............................................................................................................................... 212
5.1.6 Category-wise Tariff Design ...................................................................................................... 212
5.1.7 RTS-2: Non-Domestic Tariff ....................................................................................................... 214
5.1.8 RTS-3: Government Public Utilities .......................................................................................... 216
5.1.9 RTS-4: Private Tube Wells/Pump Setsand Agriculture Allied Activities ........................... 217
5.1.10 RTS-5: Industry ............................................................................................................................ 217
5.1.11 RTS-6: Mixed Load ...................................................................................................................... 219
5.1.12 RTS-7: Railway Traction ............................................................................................................. 219
5.2 Revenue for FY 2018-19 .............................................................................................................220
5.3 Cross Subsidy .............................................................................................................................220
5.4 Open Access Charges .................................................................................................................222
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6. Review of Commercial Performance of UPCL .............................................................................226
6.1 General ........................................................................................................................................ 226
6.1.1 Consumer Mix during FY 2015-16 & FY 2016-17 .................................................................... 228
6.1.2 Consumption Pattern during FY 2015-16 & FY 2016-17......................................................... 229
6.1.3 Revenue Pattern during FY 2015-16 & FY 2016-17 ................................................................. 231
6.2 Commission’s Analysis and Directions on Commercial Performance ............................. 232
6.2.1 Metering........................................................................................................................................ 234
6.2.2 Billing ............................................................................................................................................ 241
6.2.3 Billing and Bill Collection System ............................................................................................. 247
6.3 Energy Audit............................................................................................................................... 250
6.4 AT&C Losses .............................................................................................................................. 251
6.5 Commission’s Analysis and Directions on Financial Performance .................................. 255
6.5.1 Liquidity Ratio ............................................................................................................................. 255
6.5.2 Solvency Ratio .............................................................................................................................. 259
6.5.3 Profitability Ratio ........................................................................................................................ 261
6.5.4 Operating or Activity Ratio........................................................................................................ 262
6.5.5 Efficiency Ratio ............................................................................................................................ 265
6.5.6 Conclusion .................................................................................................................................... 268
7. Commission’s Directives .................................................................................................................270
7.1 Compliance to the Directives Issued in Tariff Order for FY 2017-18 dated March 29, 2017270
7.1.1 Performance Report .................................................................................................................... 270
7.1.2 Sales ............................................................................................................................................... 271
7.1.3 Load Shedding ............................................................................................................................. 274
7.1.4 AT&C Losses ................................................................................................................................ 275
7.1.5 Power Purchase Quantum and Cost ......................................................................................... 276
7.1.6 Fixed Assets Register .................................................................................................................. 277
7.1.7 Depreciation ................................................................................................................................. 279
7.1.8 Return on Equity ......................................................................................................................... 280
7.1.9 Employee Expenses ..................................................................................................................... 281
7.1.10 Bad &Doubtful Debts .................................................................................................................. 284
7.1.11 Reliability Indices ........................................................................................................................ 285
7.1.12 Voltage wise Cost of Supply ...................................................................................................... 285
7.1.13 Demand Side Management Measures ...................................................................................... 287
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7.1.14 Issues raised by the Petitioner again despite Commission’s ruling in previous Tariff
Orders............................................................................................................................................ 288
7.1.15 Metering of unmetered connections ......................................................................................... 289
7.1.16 Interest on GPF Trust .................................................................................................................. 289
7.1.17 Power Purchase Expenses (Including Transmission Charges) ............................................. 290
7.1.18 Deficit/Surplus Power ................................................................................................................ 291
7.1.19 Status of NA/NR, IDF/ADF/RDF ........................................................................................... 292
7.1.20 Replacement of Improper, Non-Functional, Stop/Stuck up defective or IDF Meters ....... 293
7.1.21 Replacement of Mechanical Meters .......................................................................................... 294
7.1.22 Ghost/Fictitious Consumers ...................................................................................................... 295
7.1.23 NB & SB Cases ............................................................................................................................. 296
7.1.24 Outstanding Arrears ................................................................................................................... 297
7.1.25 Status of KCC Consumers .......................................................................................................... 298
7.1.26 Status of Revenue realisation per unit sold .............................................................................. 299
7.1.27 Billing and Collection System .................................................................................................... 300
7.1.28 Energy Audit ................................................................................................................................ 301
7.1.29 Transfer of Distribution Business from UJVN Ltd. to UPCL (Reference Para 7.2.22 of Tariff
Order dated 10.04.2014) .............................................................................................................. 302
7.1.30 Departmental Employees ........................................................................................................... 303
7.1.31 Location of Installation of Meters .............................................................................................. 305
7.1.32 Transfer of Petitioner’s Personnel ............................................................................................. 305
7.1.33 Water Tax...................................................................................................................................... 306
7.1.34 Open Access Charges .................................................................................................................. 306
7.1.35 Tariff Hike .................................................................................................................................... 308
7.1.36 Collection Efficiency .................................................................................................................... 309
7.1.37 Metering & Billing ....................................................................................................................... 310
7.1.38 Construction of 33/11 kV Sub-station ...................................................................................... 311
7.1.39 LED Distribution ......................................................................................................................... 312
7.1.40 Defective Metering Correction .................................................................................................. 312
7.1.41 Online Load Survey Reports ...................................................................................................... 313
7.1.42 Delay in Fault Rectification ........................................................................................................ 313
7.1.43 Proof of Ownership ..................................................................................................................... 314
7.1.44 Tariff Revenue .............................................................................................................................. 314
7.1.45 Distribution Loss Trajectory ....................................................................................................... 314
7.1.46 Impact of Seventh Pay Commission ......................................................................................... 315
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7.1.47 Prepaid Metering ......................................................................................................................... 315
7.1.48 Current Ratio................................................................................................................................ 316
7.1.49 Repair & Maintenance to Inventory Ratio ............................................................................... 317
7.1.50 Average Collection Period ......................................................................................................... 317
7.2 Fresh Directives ......................................................................................................................... 318
7.2.1 Departmental Employees ........................................................................................................... 318
7.2.2 Billing ............................................................................................................................................ 318
7.2.3 Temporary Connection ............................................................................................................... 319
7.2.4 Collection Efficiency ................................................................................................................... 319
7.2.5 Views of State Advisory Committee ......................................................................................... 319
7.2.6 Cost of Free Power ...................................................................................................................... 319
7.2.7 Depreciation ................................................................................................................................. 319
7.2.8 Bad Debt ....................................................................................................................................... 319
7.2.9 Distribution Loss ......................................................................................................................... 320
7.2.10 Impact of VII Pay Commission .................................................................................................. 320
7.2.11 Additional A&G Expenses ......................................................................................................... 320
7.2.12 Adjustment of Free Power ......................................................................................................... 320
7.2.13 Consumer Mix ............................................................................................................................. 320
7.2.14 Conductor Augmentation .......................................................................................................... 320
7.2.15 Inventory Management .............................................................................................................. 321
7.2.16 Collection Efficiency ................................................................................................................... 321
7.3 Conclusion .................................................................................................................................. 321
8. Annexures ...........................................................................................................................................323
8.1 Annexure 1: Rate Schedule Effective from 01.04.2018........................................................... 323
8.2 Annexure 2: Schedule of Miscellaneous Charges................................................................... 347
8.3 Annexure 3: Public Notice ........................................................................................................ 348
8.4 Annexure 4: List of Respondents ............................................................................................. 350
8.5 Annexure 5: List of Participants in Public Hearings ........................................................... 353
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List of Tables
Table 1.1: Publication of Notice ...................................................................................................................... 5
Table 1.2: Schedule of Hearing ....................................................................................................................... 5
Table 2.1: Details of year wise capital expenditure and improvement in collection (productivity)
submitted by the Petitioner ................................................................................................................... 46
Table 2.2: Revised Level of Distribution Loss proposed by the Petitioner ............................................. 51
Table 3.1: Revised Means of Finance of additional capitalization from FY 2012-13 to FY 2015-16 as
claimed by the Petitioner (Rs. Crore) ................................................................................................... 76
Table 3.2: Impact of change in funding of additional capitalisation from FY 2012-13 to FY 2015-16 as
claimed by the Petitioner (Rs. Crore) ................................................................................................... 76
Table 3.3: Impact of change in funding of additional capitalisation from FY 2012-13 to FY 2015-16
approved by the Commission (Rs. Crore)........................................................................................... 77
Table 3.4: Break up of Sales submitted by the Petitioner for FY 2016-17 (MU) ..................................... 79
Table 3.5: Findings of the Sales audit for FY 2015-16 ................................................................................ 80
Table 3.6: Re-casted Sales for Domestic Category for FY 2016-17 (MU) ................................................. 81
Table 3.7: Departmental Employees of UPCL, PTCUL and UJVN Ltd. as on 31.03.2016 and
31.03.2017 as per Commercial Diary .................................................................................................... 82
Table 3.8: Consumption Pattern of Departmental Employees ................................................................. 82
Table 3.9: Re-casted sales for Other Categories for FY 2016-17 (MU) ..................................................... 84
Table 3.10: Category-wise Sales for FY 2016-17 (MU) ............................................................................... 85
Table 3.11: Assessed Distribution losses for FY 2016-17 (MU)................................................................. 86
Table 3.12: Power Purchase Cost approved in the Tariff Order Vs Actual Power Purchase Cost for
FY 2016-17 (Rs. Crore) ............................................................................................................................ 87
Table 3.13: Cost of UI Overdrawal approved by the Commission .......................................................... 89
Table 3.14: Details of Cost of Free Power (Rs. Crore) ................................................................................ 90
Table 3.15: Power Purchase Cost claimed by UPCL and approved by the Commission for FY 2016-
17 (Rs. Crore) ........................................................................................................................................... 91
Table 3.16: Power Purchase Cost claimed by UPCL and approved by the Commission for FY 2016-
17 (Rs. Crore) ........................................................................................................................................... 91
Table 3.17: Revised Employee Expenses as claimed by the Petitioner (Rs. Crore) ............................... 94
Table 3.18: Approved Employee Expenses for FY 2016-17 (Rs. Crore)................................................... 95
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Table 3.19: Approved R&M Expenses for FY 2016-17 (Rs. Crore) ...........................................................95
Table 3.20: Additional A&G Expenses as claimed by the Petitioner (Rs. Crore) ...................................96
Table 3.21: Operational Cost towards maintenance of Data Centre as submitted by the Petitioner
(Rs. Crore) ................................................................................................................................................97
Table 3.22: Additional Cost of A&G Expenses as submitted by the Petitioner (Rs.) .............................97
Table 3.23: Approved A&G expenses for FY 2016-17 (Rs. Crore) ............................................................98
Table 3.24: Approved O&M Expenses for FY 2016-17 (Rs. Crore) ...........................................................99
Table 3.25: Assets base approved by the Commission (Rs. Crore) ........................................................100
Table 3.26: Assets base approved by the Commission for FY 2016-17 (Rs. Crore) ..............................100
Table 3.27: Means of Finance for FY 2016-17 as submitted by the Petitioner (Rs. Crore) ...................101
Table 3.28: Means of Finance as approved by the Commission for FY 2016-17 (Rs. Crore)...............101
Table 3.29: Guarantee Fee claimed by the Petitioner in FY 2016-17 (Rs. Crore) ..................................103
Table 3.30: Basis of computing provisions on account of Guarantee Fee (Rs. Crore) .........................104
Table 3.31: Interest and Finance Charges for FY 2016-17 (Rs. Crore) ...................................................105
Table 3.32: Depreciation approved for FY 2016-17 (Rs. Crore)...............................................................106
Table 3.33: Provision for Bad and Doubtful Debts and Actual Write off (Rs. Crore) ..........................107
Table 3.34: Interest on Working Capital for FY 2016-17 (Rs. Crore) ......................................................109
Table 3.35: Return on Equity approved by the Commission for FY 2016-17 (Rs. Crore) ....................110
Table 3.36: Non-tariff Income approved by the Commission for FY 2016-17 (Rs. Crore) ..................112
Table 3.37: Revenue for FY 2016-17 Corresponding to Assessed Sales .................................................114
Table 3.38: Revenue from Sale of Power for FY 2016-17 (Rs. Crore) .....................................................115
Table 3.39: Additional Revenue from Sale due to inefficiency for FY 2016-17 (Rs. Crore).................115
Table 3.40: Sharing of Gains and Losses for FY 2016-17 claimed by the Petitioner (Rs. Crore) .........116
Table 3.41: Sharing of Gains on Account of Controllable Factors approved by the Commission for
FY 2016-17 (Rs. Crore) ..........................................................................................................................118
Table 3.42: O&M Expenses as Trued up by the Commission for FY 2016-17 (Rs. Crore) ...................118
Table 3.43: Summary of true up for FY 2016-17 approved by the Commission (Rs. Crore) ..............119
Table 4.1: Actual Energy sales for consumer categories during FY 2011-12 to FY 2016-17 (MU) .....122
Table 4.2: CAGR calculated for Energy Sales to each consumer category ............................................124
Table 4.3: Sales projected by the Petitioner for FY 2018-19 (MU)...........................................................126
Table 4.4: Consumer Category wise sales approved by the Commission for FY 2018-19 (MU)........127
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Table 4.5: Distribution Loss Trajectory approved by the Commission for the second Control Period
from FY 2016-17 to FY 2018-19............................................................................................................ 127
Table 4.6: Distribution Loss for FY 2015-16 to FY 2018-19 ...................................................................... 128
Table 4.7: High Distribution Loss divisions as on 31.03.2017................................................................. 129
Table 4.8: AT&C Loss Target as per UDAY .............................................................................................. 130
Table 4.9: Distribution Losses for FY 2018-19 ........................................................................................... 131
Table 4.10: Energy Input requirement approved by the Commission for FY 2018-19........................ 132
Table 4.11: Power Purchase from UJVN Ltd. ........................................................................................... 137
Table 4.12: Summary of Energy Availability from UJVNL for FY 2018-19 (MU)................................ 138
Table 4.13: Power Purchase from NHPC Ltd. .......................................................................................... 138
Table 4.14: Energy Availability from NHPC Ltd. for FY 2018-19 (MU) ............................................... 139
Table 4.15: Power Purchase from THDC India Ltd. ................................................................................ 139
Table 4.16: Energy Availability at State periphery from THDC Ltd. for FY 2018-19 (MU) ............... 139
Table 4.17: Power Purchase from NTPC Ltd. ........................................................................................... 140
Table 4.18: Energy Availability from NTPC Ltd. at State periphery for FY 2018-19 (MU) ................ 140
Table 4.19: Power Purchase from SJVN Ltd. ............................................................................................ 141
Table 4.20: Energy Availability from SJVN Ltd. at State periphery for FY 2018-19 (MU) ................. 141
Table 4.21: Energy Availability from NPCIL at State periphery for FY 2018-19 (MU) ....................... 141
Table 4.22: Energy Availability from existing Renewable Energy Sources for FY 2018-19 (MU) ..... 142
Table 4.23: Energy Availability from Vishnu Prayag HEP at State Periphery (State Royalty Power)
for FY 2017-18 (MU) ............................................................................................................................. 142
Table 4.24: Energy Availability from Sasan UMPP at State periphery for FY 2018-19 (MU) ............ 143
Table 4.25: Energy Availability from State Gas Generating Stations at State periphery for FY 2018-19
(MU) ....................................................................................................................................................... 143
Table 4.26: Energy Availability from Greenko Budhil Hydro at State periphery for FY 2018-19 (MU)
................................................................................................................................................................. 144
Table 4.27: Energy Availability from Upcoming Stations at State periphery for FY 2018-19 (MU) . 144
Table 4.28: Energy Availability from Firm Sources at State periphery for FY 2018-19 (MU) ............ 145
Table 4.29: Additional Purchase for fulfilling RPO as claimed for FY 2018-19.................................... 146
Table 4.30: Additional Purchase for fulfilling RPO ................................................................................. 146
Table 4.31: Approach of the Commission in estimating the Cost of Power Purchase ........................ 151
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Table 4.32: Summary of Free Power Rate for FY 2018-19 ........................................................................153
Table 4.33: Summary of power purchase cost for FY 2018-19 ................................................................154
Table 4.34: Quarterly Power Purchase approved by the Commission for FY 2018-19 .......................156
Table 4.35: Energy Charges of Thermal Generating Stations for FY 2018-19 .......................................156
Table 4.36: Transmission Charges for FY 2018-19 (Rs. Crore) ................................................................158
Table 4.37: Proposed Capital Expenditure and Capitalisation for FY 2017-18 and FY 2018-19 (Rs.
Crore) ......................................................................................................................................................160
Table 4.38: Actual GFA addition of UPCL (Rs. Crore) ............................................................................161
Table 4.39: GFA base approved by the Commission for FY 2018-19 (Rs. Crore) .................................162
Table 4.40: Means of Finance approved by the Commission (Rs. Crore)..............................................162
Table 4.41: Interest on Loan approved by the Commission for FY 2018-19 (Rs. Crore) .....................164
Table 4.42: Depreciation approved for FY 2018-19 (Rs. Crore)...............................................................166
Table 4.43: Status of recruitment as submitted by the Petitioner for FY 2017-18 and FY 2018-19 .....169
Table 4.44: Employee Expenses approved by the Commission for FY 2018-19 (Rs. Crore) ...............172
Table 4.45: R&M Expenses approved by the Commission for FY 2018-19 (Rs. Crore) .......................173
Table 4.46: Additional Provisioning for Data Centre (Rs. Crore)...........................................................174
Table 4.47: A&G Expenses approved by the Commission for FY 2018-19 (Rs. Crore)........................176
Table 4.48: O&M Expenses as approved by the Commission for FY 2018-19 (Rs. Crore) ..................176
Table 4.49: Capital required to finance the shortfall in collection of current dues approved by the
Commission ...........................................................................................................................................178
Table 4.50: Return on Equity approved by the Commission for FY 2018-19 (Rs. Crore) ....................180
Table 4.51: Past Year Adjustment approved for FY 2018-19 (Rs. Crore) ...............................................183
Table 4.52: Revenue Requirement approved by the Commission for FY 2018-19 (Rs. Crore) ...........184
Table 4.53: Revenue for FY 2018-19 at existing Tariff (Rs. Crore) ..........................................................185
Table 4.54: Revenue Gap for FY 2018-19 (Rs. Crore) ................................................................................186
Table 5.1: Effective Tariff & Cross-subsidy for HT Industry having contracted load 1 kVA.............204
Table 5.2: Tariff for Domestic Consumers .................................................................................................214
Table 5.3: Concessional Tariff for Snowbound Areas ..............................................................................214
Table 5.4: Tariff for Non-domestic consumers ..........................................................................................215
Table 5.5: Tariff for Public Lamps ...............................................................................................................216
Table 5.6: Tariff for Government Irrigation System .................................................................................216
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Table 5.7: Tariff for Public Water Works ................................................................................................... 216
Table 5.8: Tariff for Private tube Wells/ Pump Sets ................................................................................ 217
Table 5.9: Tariff for LT Industries ............................................................................................................... 218
Table 5.10: Existing and Proposed Tariff for HT Industries ................................................................... 218
Table 5.11: Approved Tariff for HT Industry ........................................................................................... 219
Table 5.12: Tariff for Mixed Load ............................................................................................................... 219
Table 5.13: Tariff for Railway Traction ...................................................................................................... 219
Table 5.14: Summary of Category Wise Projected Revenue ................................................................... 220
Table 5.15: Cross Subsidy at Average Cost of Supply ............................................................................. 221
Table 5.16: Cross Subsidy at Approved Tariffs in FY 2017-18 and FY 2018-19.................................... 221
Table 5.17: Wheeling Charges approved for FY 2018-19 ........................................................................ 223
Table 6.1: Detail of Substations (S/s) maintained by UPCL as on 31.12.2017 ...................................... 226
Table 6.2: Detail of Lines maintained by UPCL as on 31.12.2017 .......................................................... 227
Table 6.3: Increase in Assets of UPCL in last one year (31.12.16 to 31.12.2017) ................................... 227
Table 6.4: Quantum of Power Traded through Open Access................................................................. 231
Table 6.5: Revised Formats prescribed by the Commission vide letter dated 27.11.2014 .................. 233
Table 6.6: Status of Provisional Billing viz. NA/NR/IDF/ADF/RDF ................................................. 236
Table 6.7: Status of Defective Meters ........................................................................................................ 238
Table 6.8: Status of Unmetered Consumers .............................................................................................. 239
Table 6.9: Status of Mechanical Meters ...................................................................................................... 240
Table 6.10: Status of Ghost/Fictitious Consumers ................................................................................... 241
Table 6.11: Status of NB & SB Cases........................................................................................................... 242
Table 6.12: Status of Outstanding Arrears ............................................................................................... 243
Table 6.13: Comparison of Outstanding Arrears (Rs. Crore) ................................................................. 244
Table 6.14: Status of KCC Consumers ....................................................................................................... 245
Table 6.15: Status of Revenue Realisation per unit sold......................................................................... 247
Table 6.16: Status of AT&C Losses of UPCL ............................................................................................ 251
Table 7.1: Findings of UPCL’s Consultant on Sales Audit for FY 2015-16 .......................................... 273
Table 7.2: Power Purchase for 1st Quarter of FY 2017-18 as submitted by the Petitioner.................. 277
Table 7.3: Recruitment Status as submitted by the Petitioner ................................................................ 281
Table 7.4: Posts Under-Process as submitted by the Petitioner ............................................................. 282
xii
Table 7.5: Posts Under-Process as submitted by the Petitioner ..............................................................283
Table 7.6: Details of SAIFI, SAIDI & MAIFI for the month of August, 2017 ........................................285
Table 7.7: Division-wise Progress of Metering at 33 kV ..........................................................................286
Table 7.8: Status of Distribution of Energy Efficient Equipments ..........................................................288
Table 7.9: Details of Banking Arrangement done in FY 2017-18 ............................................................291
Table 7.10: Details of Advance Banking.....................................................................................................292
Table 7.11: Status of Creation of facilities at the collection centers ........................................................301
Table 7.12: Division wise Progress of Energy Auditing ..........................................................................302
Table 7.13: Accounting Heads for booking Revenue received under Open Access ...........................307
Table 7.14: Details of payment collected through the Bill Collection Agencies ...................................309
Table 7.15: Status of Distribution of Energy Efficient Equipments ........................................................312
Table 7.16: Status of Prepaid Meter installed on monthly basis .............................................................316
xiii
Before
UTTARAKHAND ELECTRICITY REGULATORY COMMISSION
Petition No. 49 of 2017
In the Matter of:

Petition filed by Uttarakhand Power Corporation Limited for True up for FY 2016-17, Annual
Performance Review for FY 2017-18 and Aggregate Revenue Requirement of FY 2018-19.
AND
In the Matter of:
Uttarakhand Power Corporation Limited

Urja Bhawan, Kanwali Road, Dehradun ……… Petitioner
Coram
Shri Subhash Kumar Chairman
Date of Order: March 21, 2018
Section 64(1) read with Section 61 and 62 of the Electricity Act, 2003 (hereinafter referred to
as “the Act”) requires the Generating Companies and the Licensees to file an application for
determination of tariff before the Appropriate Commission in such manner and along with such fee
as may be specified by the Appropriate Commission through Regulations.
In accordance with the relevant provisions of the Act, the Commission had notified
Uttarakhand Electricity Regulatory Commission (Terms and Conditions for Determination of Multi
Year Tariff) Regulations, 2015 (hereinafter referred to as “UERC Tariff Regulations, 2015”) for the
second Control Period from FY 2016-17 to FY 2018-19 specifying therein terms, conditions and
norms of operation for licensees, generating companies and SLDC. The Commission had issued the
Uttarakhand Electricity Regulatory Commission 1

Order on True-up for FY 2016-17, APR for FY 2017-18 & ARR for FY 2018-19
Order on approval of Business Plan and Multi Year Tariff dated April 5, 2016 for the Control Period
FY 2016-17 to FY 2018-19. In accordance with the provisions of the UERC Tariff Regulations, 2015,
the Commission had carried out the Annual Performance Review for FY 2016-17 vide its Order
dated March 29, 2017.
As per the provisions of Regulation 12 of the UERC Tariff Regulations, 2015, UPCL filed a
Petition (Petition No. 49 of 2017 and hereinafter referred to as the “Petition”), giving details of its
revised projections of Aggregate Revenue Requirement (ARR) for FY 2018-19, based on the true up
for FY 2016-17 and Annual Performance Review for FY 2017-18 on November 29, 2017.
The Petition filed by UPCL had certain infirmities/deficiencies. The Commission,

accordingly, vide its letter no. UERC/6/TF-429/17-18/2017/1422 dated December 7, 2017 directed
UPCL to rectify these infirmities/deficiencies and to submit certain additional information
necessary for admission of the MYT Petition. UPCL vide its letter no. 5033/UPCL/RM/B-19 dated
December 15, 2017 submitted most of the information sought by the Commission. Based on the
submission dated December 15, 2017 by UPCL, the Commission vide its Order dated December 21,
2017 provisionally admitted the APR Petition, with the condition that UPCL shall furnish any
further information/clarifications as deemed necessary by the Commission during the processing of
the Petition within the time frame, as may be stipulated by the Commission, failing which the
Commission may proceed to dispose of the matter as deemed fit by it based on the information
available with it.
This Order, accordingly, relates to APR Petition filed by UPCL for true up of FY 2016-17,
APR of FY 2017-18 and ARR of FY 2018-19 and is based on the original as well as all the subsequent
submissions made by UPCL during the course of the proceedings.
Tariff determination being the most vital function of the Commission, it has been the
practice of the Commission to elaborate in detail the procedure and to explain the underlying
principles in determination of tariffs. Accordingly, in the present Order also, in line with the past
practices, the Commission has tried to detail the procedure and principles followed by it in
determining the ARR of the licensee. For the sake of convenience and clarity, this Order has further
been divided into following Chapters:
2 Uttarakhand Electricity Regulatory Commission

Chapter 1 - Background and Procedural History
Chapter 2 - Stakeholders’ Objections/suggestions, Petitioner’s Responses & Commission’s
Views
Chapter 3 - Petitioner’s Submissions, Commission’s Analysis, Scrutiny and Conclusion on
Truing up for FY 2016-17
Chapter 4 - Petitioner’s Submissions, Commission’s Analysis, Scrutiny and Conclusion on
Annual Revenue Requirement for FY 2018-19
Chapter 5 – Tariff Rationalisation, Tariff Design and Related Issues
Chapter 6 - Review of Commercial Performance of UPCL
Chapter 7 - Commission’s Directives

1. Background and Procedural History
In accordance with the provisions of the Uttar Pradesh Reorganization Act, 2000 (Act 29 of
2000), enacted by the Parliament of India on August 25, 2000, the State of Uttaranchal came into
existence on November 9, 2000. Section 63(4) of the above Reorganization Act allowed the
Government of Uttaranchal (hereinafter referred to as “GoU” or “State Government”) to constitute
a State Power Corporation at any time after the creation of the State. GoU, accordingly, established
the Uttaranchal Power Corporation Limited (UPCL) under the Companies Act, 1956, on February
12, 2001 and entrusted it with the business of transmission and distribution in the State.
Subsequently, from April 1, 2001, all works pertaining to the transmission, distribution and retail
supply of electricity in the area of Uttaranchal were transferred from UPPCL to UPCL, in
accordance with the Memorandum of Understanding dated March 13, 2001, signed between the
Governments of Uttaranchal and Uttar Pradesh. On May 31, 2004, GoU first vested all the interests,
rights and liabilities related to Power Transmission and Load Despatch of “Uttaranchal Power
Corporation Limited” into itself and, thereafter, re-vested them into a new company, i.e. “Power
Transmission Corporation of Uttaranchal Limited”, now renamed as “Power Transmission
Corporation of Uttarakhand Limited” after change of name of the State. Since then Uttarakhand
Power Corporation Ltd. (UPCL) a company wholly owned by the Government of Uttarakhand
became the sole distribution licensee engaged in the business of distribution and retail supply of
power in the State of Uttarakhand.
The Commission vide its Order dated April 05, 2016 issued the Order on approval of
Business Plan for UPCL for the second Control Period FY 2016-17 to FY 2018-19 and Tariff for FY
2016-17. Further, the Commission had issued the Tariff Order for FY 2017-18 vide its Order dated
March 29, 2017.
As mentioned earlier also, in accordance with the provisions of the Electricity Act, 2003 and
Regulation 12 of the UERC Tariff Regulations, 2015, UPCL was required to submit the APR Petition
for determination of its ARR by November 30, 2017. UPCL in compliance to the Regulations
submitted the APR Petition for True up for FY 2016-17, Annual Performance Review for FY 2017-18
and Aggregate Revenue Requirement for FY 2018-19 on November 29, 2017.
The APR Petition was provisionally admitted by the Commission vide its Order dated

December 21, 2017. The Commission, through its above Admittance Order dated December 21,
2017, to provide transparency to the process of tariff determination and give all stakeholders an
opportunity to submit their objections/suggestions/comments on the proposals of the Distribution
Licensee, also directed UPCL to publish the salient features of its proposals in the leading
newspapers. The salient features of the proposal were published by the Petitioner in the following
newspapers:
Table 1.1: Publication of Notice

S.No. Newspaper Name Date Of Publication
1. Amar Ujala 25.12.2017
2. Dainik Jagran 25.12.2017
3. Hindustan 25.12.2017
4. Rashtriya Sahara 25.12.2017
5. Times of India 25.12.2017
6. Hindustan Times 25.12.2017
7. Indian Express 25.12.2017
Through above notice, the stakeholders were requested to submit their
objections/suggestions/comments latest by 31st January, 2018 (copy of the notice is enclosed as
Annexure-3). The Commission received in all 41 objections/suggestions/comments in writing on
the Petition filed by UPCL. The list of stakeholders who have submitted their
objections/suggestions/comments in writing is enclosed as Annexure-4.
Further, for direct interaction with all the stakeholders and public at large, the Commission
also held public hearings on the proposals filed by the Petitioner at the following places in the State
of Uttarakhand.
Table 1.2: Schedule of Hearing

S. No Place Date
1. Bageshwar February 20, 2018
2. Rudrapur February 21, 2018
3. Rudraprayag February 27, 2018
4. Dehradun February 28, 2018
The list of participants who attended the Public Hearing is enclosed at Annexure-5.
The Commission also sent the copies of salient features of tariff petitions to the Members of
the State Advisory Committee and the State Government. The salient features of the APR Petition
submitted by UPCL were also made available on the website of the Commission, i.e.
www.uerc.gov.in. The Commission also held a meeting with the Members of the Advisory

Committee on March 5, 2018, wherein, detailed deliberations were held with the Members of the
Advisory Committee on the various issues linked with the Petition filed by UPCL.
The objections/suggestions/comments, as received from the stakeholders through

mail/post as well as during the course of public hearing were sent to the Petitioner for its response.
All the issues raised by the stakeholders and Petitioner’s response and Commission’s views thereon
are detailed in Chapter 2 of this Order. In this context, it is also to underline that while finalizing
this Order, the Commission has, as far as possible, tried to address the issues raised by the
stakeholders.
Meanwhile, based on the scrutiny of the Petition submitted by UPCL, the Commission vide
its letter no. UERC/6/TF-429/17-18/2017/1422 dated December 7, 2017, pointed out certain data
gaps in the Petitions and sought following additional information/clarifications from the Petitioner:
 Audited accounts for FY 2016-17 along with Statutory Auditor’s and AG’s Audit
Report.
 Submission of duly filled excel formats along with the break-up of actual for H1
(April -September) and estimated for H2 (October – March) of FY 2017-18.
 Details of Bad Debts written off by it.
 Category-wise revenue billed during FY 2016-17
 Actual sales data for FY 2017-18 till September, 2017.
 Status of capital expenditure (both physical and financial) which has been proposed
in FY 2017-18 and FY 2018-19.
 Actual number of new employees employed, employees promoted and employees

retired in FY 2016-17, FY 2017-18 and FY 2018-19 along with the preparedness for the
proposed recruitments.
 Segregated additions of fixed assets into HT and LT works and clearance from the
Electrical Inspector for capitalization of various HT/EHT schemes for FY 2016-17.
 Rationale and necessary government approval behind adjustment of Government

revenue from free power to reduce cross subsidy.
 Category wise load shedding data for FY 2016-17 and FY 2017-18.
 Existing and proposed category wise cross subsidy.

 Actual interest on Consumer Security Deposit paid to consumers/adjusted in

Consumer’s bills in FY 2016-17.
 Basis of considering expected COD for new generating stations.
 Scheme wise additional capitalisation details matching the same with investment
approval accorded by the Commission.
 Power Purchase Bills for FY 2016-17 and recent bills for FY 2017-18.
 MTB’s till September 2017.
So as to have better clarity on the data filed by the Petitioner and also to remove
inconsistency in the data, a Technical Validation Session (TVS) was also held with the Petitioner’s
Officers on January 5, 2018, for further deliberations on certain issues related to the Petition filed by
UPCL. Minutes of above Technical Validation Session were sent to the Petitioner vide
Commission’s letter no. UERC/6/TF-429/17-18/2017/1565 dated January 05, 2018, for its response.
The Petitioner submitted the replies to the data gaps and clarifications sought during TVS
vide its letter no. 5033/UPCL/RM/B-19 dated December 15, 2017, letter no. 189/UPCL/RM/B-19
dated 16.01.2018, letter no. 434/UPCL/RM/B-19 dated January 31, 2018. The submissions made by
UPCL in the Petition as well as additional submissions have been discussed by the Commission at
appropriate places in the Tariff Order along with the Commission’s views on the same.

2. Stakeholders’Objections/Suggestions, Petitioner’s Responses
and Commission’s Views
The Commission has received suggestions and objections on UPCL’s Petition for True-up for
FY 2016-17, Annual Performance Review of FY 2017-18 and Determination of Annual Revenue
Requirement for FY 2018-19. The Commission also obtained responses from UPCL on the comments
received from the stakeholders.
Since, several issues are common and have been raised by more than one Respondent all the
comments have been clubbed issue-wise and summarized below.
2.1 General
2.1.1.1 Stakeholder’s Comments
Shri Pawan Agarwal of Uttarakhand Steel Manufacturers Association submitted that instead
of determining annual tariff, tariffs should be fixed for a period of 3-4 years to increase investment
and reduce expenditure in the State. He further submitted that considering the difficult
geographical conditions in Uttarakhand, there should be special exemptions for industries
operating in the State. Shri Ram Kumar of Mussoorie Hotels Association submitted that the exercise
of determining annual tariff is unjust and the tariff should be revised atleast after 5 years.
Dr. V.K. Garg submitted that the summary of UPCL, UJVN Ltd., PTCUL and SLDC ARR for
FY 2018-19 does not seem consistent with the Capital Expenditure, Cost of Capital, RoE and Rates of
Interest being paid on Debt separately for Capital expenditure and Working Capital on Cost side.
Shri Amit Joshi submitted that prudence check of each and every component of ARR should
be done so that the inefficiencies of UPCL do not pass on to the consumers of the State.
Shri Sudhir Goyal submitted that the Petitioner has been subject to a recurring penalty
imposed on it by the Commission and this shows the inefficiency of the Petitioner. In this regard, he
suggested that the losses incurred because of the inefficiency of UPCL should not be passed on to
the consumers.

2. Summary of Stakeholders’ Objections/Suggestions, Petitioner’s Responses and Commission’s Views
2.1.1.2 Petitioner’s Reply
The Petitioner submitted that the Commission vide its Tariff Order dated 05.04.2016
approved the ARR excluding power purchase cost for the Control Period FY 2016-17 to FY 2018-19.
However, annual tariff determination is necessary in order to estimate the price closer to the actual
cost of supply.
Further, the Petitioner submitted that in annual Tariff Petitions it has provided a detailed
section on revenue from sale of power, actual/proposed capital expenditure, capitalization,
depreciation and RoE in line with the UERC Tariff Regulations, 2015.
Further with regard to penalty imposed on UPCL by the Commission, the Petitioner
submitted that no penalty of UPCL has been passed on to the consumers. However, sharing of gains
& losses computed as per actual performance as compared to targeted performance are being
passed on to the consumers as per provisions of the Regulations.
2.1.1.3 Commission’s Views
As per the provisions of UERC (Terms and Conditions for Determination of Multi Year
Tariff) Regulations, 2015, the tariff for the ensuing year is determined every year based on the true
up of the ARR of the previous year for which latest audited accounts available and the latest power
purchase costs. Further, the tariff is determined on the basis of normative parameters and expenses
are only allowed after carrying out due prudence check.
2.2 Overall Tariff Increase
Shri R.K. Singh of Tata Motors Ltd., Shri Munish Talwar of Asahi India Glass Ltd., Shri
Pawan Agarwal of Uttarakhand Steel Manufacturers Association, Shri Pankaj Singh Bora of
Galwalia Ispat Udyog Pvt. Ltd., Smt. Rashmi Agrawal, Shri Pramod Singh Tomar of PSR
Innovations LLP, Shri Shiv Narayan Baluni and Shri Shakeel A Siddiqui submitted that an increase
proposed by UPCL in categories like Domestic, Public Water Works, LT & HT Industry and Mixed
load along with the hikes proposed by UJVN Ltd. and PTCUL are exorbitant and unjustified.

M/s Hero MotoCorp Ltd. submitted that there has been a hike of 21.2% in power tariff in the
last 2.5 years and the Petitioner in the instant Tariff Petition has proposed a further tariff hike of
13.44%, which should not be allowed.
Shri Jatinder Kumar of Air Liquide India submitted that the tariff increase for the Industry
sector is too steep and shall discourage the industrial sector of the State. He suggested that the
revenue gap of Rs. 420 Crore should not be passed on to the consumers immediately to avoid tariff
shocks.
Shri Naval Duseja of Flex Foods Limited submitted that tariff increase proposed by UPCL
for industrial consumers is exorbitant and unjustified. He further submitted that it is not viable to
run industry due to tough competition with the tariff hike, and, therefore, any tariff hike would put
the industry into further hardships.
Shri Sudhir Goyal submitted that UPCL should check for proper solutions to recover its
losses instead of increasing tariff every year. He also submitted that UPCL should focus on the
issues like distribution losses, electricity theft, unmetered supply of electricity, free power to BPL
category, departmental expenses etc.
The Petitioner submitted that Uttarakhand has the lowest tariff in India and average tariff
hike during last four years has been only 5.48%. It further submitted that UPCL is a commercial
organization and is required to meet its Annual Revenue Requirement out of the revenue realized
from the consumers through electricity tariffs. The revenue deficit for FY 2018-19 has been
estimated at Rs. 820.29 Crore for which a tariff hike of 13.44% is required. Further, the Petitioner
submitted that it has proposed a tariff hike of 15.63% for domestic category, 12.11% for HT category
to meet the revenue gap in FY 2018-19.
The Commission is of the view that the overall tariff increase is a function of projected
Annual Revenue Requirement for the ensuing year (including impact of truing up of expenses and
revenue for previous year) and projected revenue at existing tariffs. The Commission has carried
out the detailed scrutiny of ARR for FY 2018-19 and truing up for FY 2016-17 in accordance with the
provisions of the relevant Regulations as discussed in subsequent Chapters of the Order. Based on
the approved ARR for FY 2018-19 including impact of truing up for FY 2016-17, the Commission has
marginally increased the tariff with respect to tariff for FY 2017-18 approved vide Tariff Order
dated 29.03.2017 to meet the projected revenue gap as discussed in detail in Chapter 5 of the Order.
However, as the consumers are currently paying Additional Energy Charge which is effective till
31st March, 2018, there is no tariff increase if the tariff approved in this Order is compared with the
existing tariff approved by the Commission in its Order dated 29 March, 2017 plus AEC being paid
by the consumers.
2.3 Domestic Tariff
Shri Vijay Singh Verma of Kisan club requested that UPCL should mention the basis of
charging additional electricity surcharge and fixed surcharge on Domestic consumer. He also
submitted that in RTS-I category, the energy charges may be enhanced in proper ratio and the fixed
charges should be kept same.
Shri Joga Singh Mehta submitted that the Petitioner should improve the quality of power
instead of hike in tariff. He also submitted that UPCL should charge different tariff for urban and
rural people.
M/s Shiv Shakti Electricals submitted that the Fixed Charges should only be applicable for
consumers whose premises are locked for certain period of time and not on all the consumers.
Shri Sudhir Goyal submitted that UPCL should remove the components of fixed and fuel
charges from the electricity bills as these components are not applicable to the consumers.
With regard to the levy of Fixed Charges, the Petitioner submitted that Section 45(3) of the
Electricity Act, 2003 mandates for imposition of Fixed Charge in addition to the Energy Charge for
electricity supplied. The Petitioner further submitted that total costs of UPCL may be segregated
into power purchase cost and other costs. The other cost is about 10% to 15% of the total cost is and
fixed in nature. This cost has necessarily to be incurred by UPCL and is not related to the energy
consumed, but is related to the contracted load of the consumers. Thus, this cost needs to be
recovered through Fixed/Demand Charges.

As regards additional energy surcharge, the Petitioner submitted that Additional Energy
Charges (AEC) were imposed in order to meet the additional revenue gap allowed by the
Commission in its Review Order dated 03.08.2017 as pass-through in tariff for FY 2017-18.
The Commission appreciates the views expressed by some of the stakeholders. As discussed
earlier, based on the projected ARR for FY 2018-19 including the impact of truing up for FY 2016-17,
the Commission has marginally increased the tariff with respect to tariff for FY 2017-18 approved
vide Tariff Order dated 29.03.2017 to meet the projected revenue gap as discussed in detail in
Chapter 5 of the Order. However, as the consumers are currently paying Additional Energy Charge
which is effective till 31st March, 2018, there is no tariff increase if the tariff approved in this Order is
compared with the existing tariff approved by the Commission in its Order dated 29 March, 2017
plus AEC being paid by the consumers.
Further, the Commission has deliberated in detail on the issue of levy of Fixed Charges in
Chapter 5 of the Order.
Further, continuing with the approach adopted in the previous years, the Commission has
attempted to reduce the cross-subsidy while designing the tariffs for various categories as
elaborated in Chapter 5 of the Order.
2.4 Non-Domestic Tariff
2.4.1 Tariff Hike
Shri Ram Kumar of Mussoorie Hotels Association submitted that the proposed increase in
RTS-2 category for consumers having contracted demand above 25 kW from Rs. 5.15/kVAh to Rs.
6.15/kVAh is exorbitant and the consumers should not be burdened for inefficiency of UPCL.
The Petitioner in response submitted that UPCL is a commercial organization and is

required to meet its Annual Revenue Requirement out of the revenue realized from the consumers

through electricity tariffs. The revenue deficit for FY 2018-19 has been estimated at Rs. 820.29 Crore
for which tariff hike of 13.44% is required.
As discussed earlier, based on the APR for FY 2017-18, Revised ARR for FY 2018-19
including impact of truing up for FY 2016-17, the Commission has marginally increased the tariff
with respect to tariff for FY 2017-18 approved vide Tariff Order dated 29.03.2017 to meet the
projected revenue gap as discussed in detail in Chapter 5 of the Order. However, as the consumers
are currently paying Additional Energy Charge (AEC) which is effective till 31st March, 2018, there
is no tariff increase if the tariff approved in this Order is compared with the existing tariff approved
by the Commission in its Order dated 29 March, 2017 plus AEC being paid by the consumers.
Further, continuing with the approach adopted in the previous years, the Commission has
attempted to reduce the cross-subsidy while designing the tariffs for various categories as
2.5 Agricultural Tariff
Shri Teeka Singh Saini, Shri Kuldeep Singh and some stakeholders submitted that the tariff
hike proposed by UPCL is very high and it shall affect the livelihood of farmers and other poor
population of the State. They requested the Commission not to allow the hike in tariffs.
Shri Vijay Singh Verma submitted that PTW connections supplied power through L.T.
networks should either be connected through ABC cable or through HVDS (High Voltage Direct
Supply) system. He further submitted that the reading of PTW connection should be taken on
monthly basis and billing should be done quarterly. He also submitted that Late Payment Surcharge
should be charged after 6 months in case of PTW connections. He further requested the Petitioner to
provide the accountability of revenue in case of RDF (Defective Reading) /NA (Not Accessible), NR
(Meter Not Read)/IDF (Defective Meter) for PTW connections.
Shri Katar Singh, President, Kisan club submitted that UPCL claims to have 100% metering
in case of PTW connections, however, timely meter reading, replacement of defective meters and

redressal of grievances is not being done. He further requested the Commission not to increase the
tariff for PTW consumers.
Shri Jagdish Singh of Bhartiya Kisan Sangh and Shri Sukha Singh, Shri Bulkar Singh Fauji
and other stakeholder submitted that the agricultural tariff is already on the higher side and should
not be increased. They further submitted that HT poles/lines passing through their agricultural
fields are tilted and damage their crops and hence, requested the Commission to insulate the HT
lines passing through their fields. They further submitted that no connections below 7.5 HP have
been provided by UPCL.
The Petitioner submitted that all the PTW connections are metered now and field officers
have been directed to ensure timely meter reading of such connections as well as replacement of
defective meters.
The Petitioner further submitted that UPCL is a commercial organization and is required to
meet its Annual Revenue Requirement out of the revenue realized from the consumers through
electricity tariffs, and, accordingly, it has proposed a tariff hike of 16.85% for PTW category in FY
2018-19.
Regarding the issue of no connections below 7.5 HP being released, the Petitioner submitted
that it has provided connections as per requirement.
As discussed earlier, based on APR for FY 2017-18 and Revised ARR for FY 2018-19
Further, continuing with the approach adopted in previous years, the Commission has
attempted to reduce the cross subsidy while designing the tariffs for various categories as

elaborated in Chapter 5 of this Order. With regard to meter reading the Commission has issued
suitable directions to the Petitioner to reduce provisional billing on the basis of RDF/NA/NR/IDF.
2.6 Agriculture Allied Activities
Shri G. S. Sandhu of Tarai Farm Lands private limited submitted that the farmers involved
in fisheries are not getting the benefits of electricity tariff under RTS-4A so far. Therefore, in the
interest of promoting fishery activities in Uttarakhand, Shri G. S. Sandhu requested the Commission
to include Fishery activity under Agriculture Allied Activities RST-4(A). He further requested the
Commission to incorporate aeration, recirculation and storage under the Fishery activity.
Dr. Harendra Singh Rawat, Chairman, progressive Dairy Farmer Association has submitted
that in Uttarakhand the demand for Milk is higher than that of the current production. The
production can only be increased by reducing the expenses. He further submitted that “Dairy
farming” should be included under Agriculture Allied Activities RTS-4(A) in place of Commercial
Activity.
Dr. R. P. Singh, Tarai foods Limited submitted that Tariff for Mushroom cultivation should
not be increased.
As regards tariff for Fishery activity and dairy farming, the Petitioner submitted that as per
the Tariff Order dated April 11, 2015, Rate Schedule RTS-4 pertains to “Private Tube
Wells/Pumping Sets” and such category currently applies for irrigation purposes and for incidental
agricultural processes confined to chaff cutter, thrasher, cane crusher and rice huller only. Also Rate
Schedule RTS-4A pertains to “Agriculture Allied Activities”and such category currently applies to
supply of power for use in nurseries growing plants/ saplings, polyhouses growing
flowers/vegetables and fruits including Mushroom cultivation which doesn’t involve any kind of
processing of product except for storing and preservation. Therefore, this RTS-4A is not applicable
for fishery activities.
The Petitioner further submitted that in accordance with Section 61(g) of the Electricity Act,
2003, the tariff should progressively reflect the cost of supply of electricity and also reduce cross

subsidies. As per the existing Tariff Order the Fishery activity and dairy farming is covered under
Rate Schedule RTS – 7 (Industry) which is the cross-subsidizing category whereas Rate Schedule
RTS – 4A is cross-subsidized category. In case, fishery activity or dairy farming is covered under
Rate Schedule RTS – 4A, it will be transferred from cross-subsidizing category to cross-subsidized
category which is against the provisions of Electricity Act, 2003.
The Commission with regard to inclusion of fishery and dairy farming in RTS-4A category is
of the view that these activities cannot be included in RTS-4A as RTS-4A is a subsidised category
applicable for supply of power for use in nurseries growing plants/saplings, polyhouses growing
flowers/vegetables and fruits including Mushroom cultivation which doesn’t involve any kind of
processing of product except for storing and preservation. In this regard, the Commission would,
however, like to clarify as follows:
a) As per the current practice, if the domestic consumer has kept any cattles such as cow or
buffalo in its residential premises and the milk given by that animal is utilized for self
consumption, the tariff applicable for RTS-1 Domestic Category shall be applicable.
b) If the small consumers are engaged in dairy farming at their residences and part of the
milk given by animals is being sold, then, for such consumers, as per Rate schedule
(RTS-1), Domestic Tariff is applicable, provided such consumers have contracted load
upto 2 kW and consumption upto 200 kWh/month and who are using some portion of
their premises for non domestic purposes.
2.7 Industrial Tariff
2.7.1 Tariff Hike
M/s Hero Motocorp. Ltd. submitted that demand charges should not be increased further as
it is already high.
Shri Munish Talwar of Asahi India Glass Ltd. submitted that it is not viable to run industry
due to high cost of doing business and any tariff hike would put the industry into further

hardships. He also submitted that the inefficiencies of UPCL should not be passed on as tariff hikes
to the consumers.
Shri Man Singh of Alps Industries Ltd. submitted that the recent tariff hikes have affected
the operation of the textile sector and as the sector is in overall downfall, he has requested to ease
their tariff burden with a rebate of Rs 1.00/ unit and 100% exemption from electricity duty for the
next 7 years in accordance with Point 9(v) of the Order No. 791/VII-1/40-SIIDCUL/2014 dated
December 11, 2014.
Shri Pramod Singh Tomar of PSR Innovations LLP has submitted that Billing Demand
should be 75% of the contracted load.
Shri Pawan Agarwal of Uttarakhand Steel Manufacturers Association submitted that the
Electricity duty should be completely abolished at least from RTS-7 category consumer.
green energy cess levied at Rs. 0.10/unit is an additional burden to electricity duty and should be
removed.
Shri Sudhir Goyal submitted that after GST implementation, recovery of electricity duty and
surcharge is against the Law and creates additional burden on consumers specially when GST on
electricity is nill.
The Petitioner submitted that UPCL is a commercial organization and is required to meet its
Annual Revenue Requirement out of the revenue realized from the consumers through electricity
tariffs. The revenue deficit for FY 2018-19 has been estimated at Rs. 820.29 Crore for which tariff
hike of 13.44% is required. However, it has proposed a tariff hike of 12.11% for HT Industries.
As regards 100% electricity duty exemption for textile sector, the Petitioner submitted that in
accordance with Section 3 of Uttar Pradesh Electricity (Duty) Act (Uttarakhand adaptation and
modification) Order 2001, State Government is empowered to fix the rates of Electricity Duty to be
charged from various categories of consumers. Government of Uttarakhand vide its Notification no.
79/I/2016-01(3)/01/2003, dated 25.01.2016 has fixed these rates applicable w.e.f. 01.01.2016 and
accordingly, electricity duty is charged from consumers. As the electricity duty charged from

consumers is payable by the Petitioner to Government of Uttarakhand, therefore, the matter may be
taken up with GoU.
The Petitioner further submitted that the total cost of UPCL may be segregated into power
purchase cost and other cost. The other cost is about 10% to 15% of the total cost and are fixed in
nature. For recovery of this fixed cost, billable demand has been decided by the Commission as 80%
of the contracted load or actual recorded demand during the month, whichever is higher. Reduction
in billable demand from 80% to 75% would reduce the recovery of fixed charges. The Petitioner
further submitted that in case demand charges are reduced, the energy charges will have to be
increased in order to have the composite tariff equivalent to the cost of supply plus required level of
cross subsidy.
As regards the transfer of industrial connections, the Petitioner submitted that in case of
transfer of electricity connection, the old connection is permanently disconnected and a new
connection is released at the new place after depositing connection charges including cost of works
required and security deposits.
As discussed earlier, based on the APR for FY 2017-18 and Revised ARR for FY 2018-19
Further, continuing with the approach adopted in previous years, the Commission has
attempted to reduce the cross subsidy while designing the tariffs for various categories as
The issue related to Green Cess and Electricity Duty does not fall under the purview of this
Commission and may be taken up by the consumers with the State Government.

2.8 Time of Day Tariff
Shri Sanjay Adlakha of Ambashakti Glass India Pvt. Ltd. submitted that the rates to be
charged for off peak hours to the peak hours should be of the same ratio.
overall peak hours per day is five in case of summer and eight in case of winter. He submitted that
all the other States have peak hours of only 4 hours per day charged at 20% higher than the normal
tariff, while UPCL charges 50% higher during peak hours. This has led to purchase of economical
power through open access during morning peak hours and the power of UPCL is sold at UI
market at lower prices. He further submitted that if peak hours are abolished then more industries
will buy power from UPCL which in turn will increase the revenue of UPCL.
The Petitioner submitted that the morning peak hours have been kept only in the winter
season, i.e. from October to March of the financial year. The timings of morning peak hours are
from 06:00 hrs to 09:30 hrs. Morning peak hours have been imposed due to heating load and
reduced generation in winter season, whereas the Air Conditioning load during summer season in
the State of Uttarakhand from 06:00 hrs to 09:30 hrs is negligible. Therefore, morning peak hours in
winter are required to be continued.
The Petitioner further submitted that the objective of introduction of ToD tariff is to
minimize the gap between maximum (peak) demand and minimum demand and to bring the peak
demand as closer to the average demand as possible. On every reduction of this gap, the generation
cost, transmission cost, distribution cost and power cuts will be reduced and the higher demand can
be catered from the available capacity. In other words, ToD tariff is very effective tool of demand
side management which make possible the optimum utilization of the available capacity of
Generation, Transmission and Distribution, resulting in reduction of costs. The benefit of such
reduction in cost is passed on to the consumers. With a view to effectively implement the ToD tariff,
substantial increase in tariff is required for consumption during peak hours.

The Petitioner further submitted that keeping in view the situation as mentioned above,
peak hour charges have been kept at a rate higher than the rate of rebate during off peak hours so
that the load during peak hours may be shifted to off peak hours and normal hours. Further, the
gap of demand between normal hours and off peak hours is not too high, and therefore, keeping in
view the level of this gap, this rebate should not be increased.
The Commission has analysed the actual daily hourly load curves in the State of
Uttarakhand and has found that apparent morning peak demand exist in the State during winter
months which exceeds the demand in evening peak. The Commission feels the need for Demand
Side Management (DSM) and having ToD tariff as a measure for ensuring curtailment of morning
as well as evening peaks. The Commission in the present Order is continuing with the same Peak,
Normal and Off-peak hour duration for ToD metering slots. However, as detailed in Chapter 5 of
the Order, the Commission has increased the off-peak hour rebate from existing level of 10% to 15%
in energy charges.
2.8.2 Load Factor based Tariff
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. submitted that in
Uttarakhand, HT industries consumes more than 53% of electricity. Most of the prominent
industrial active States have defined tariff slab load wise, the cost of service to HT consumer
connected at high voltage is much less than the average cost of supply, since the distribution losses
are very much less in comparison to low voltage consumers. He proposed that tariff rates should be
reversed with lower tariffs for consumption above 40% load factor to promote energy consumption
by HT industries who are the maximum contributor of revenue to UPCL.
Shri Vikas Jindal of Kumaun Garhwal Chamber of Commerce & Industry submitted that the
existing load factor based tariff, applicable for industries is not rational and deprives the consumer
from using power upto his contracted demand at the basic energy rate. The existing load factor
based tariff penalizes the industry with incremental consumption within its contracted demand by
way of high energy rates on whole of the consumption for load factor below 40% and further higher

energy rates for load factor above 40%. Such approach completely ignores the interest of the
consumers.
He also submitted that the basic calculation for load factor has to be corrected as it takes the
billed maximum demand instead of contracted demand. This anomaly can be rectified by revising
the formula for calculation of load factor as follows:
M/s. BST Textile Mills Pvt. Ltd. submitted that load factor based tariff should be abolished.
Shri Pankaj Singh Bora of Galwalia Ispat Udyog Pvt. Ltd. submitted that the Load factor will
be calculated on the basis of payable demand in place of demand consumed and tariff should
include power factor incentive.
Shri RS Yadav of India Glycols Ltd. submitted that the Central Government has
recommended lower tariffs for heavy users to encourage electricity consumption as the country is
moving from power deficit to power surplus situation, while load factor based tariff was designed
for power shortage scenario. They requested the Commission to change this framework.
load factor based tariff should be levied till 40% at the lower rate and the costlier tariff should be
levied only for the units consumed at load factor greater than 40%. He also submitted that the 40%
limit should be increased to 70% to encourage more power consumption by the industrial
consumers. If the load factor cannot be increased to 70% then the tariff for higher load factor should
be decided based on Telescopic Technique.
Shri R. K. Singh of Tata Motors Limited also requested that for HT industries, load factor
based tariff limit should be increased to 44% instead of 40%.
The Petitioner submitted that as per section 62(3) of the Electricity Act, 2003 tariff may be
differentiated on the basis of consumers’ load factor. The Petitioner further submitted that higher
energy charges are levied for higher consumption due to the fact that procurement of additional

firm power (marginal power) has higher cost. At higher load factor, demand charges per unit is
reduced which is the incentive to the consumer for having higher load factor and average tariff per
unit for the consumers having load factor upto 40% and above 40% is maintained at the same level.
In case telescopic energy charges are imposed, the rate of higher load factor shall increase
accordingly with a view to have a uniform average effective tariff at both the levels of load factors.
The Petitioner further submitted that all field officers have been directed to comply with the
provisions of the Tariff Orders regarding computation of load factor for open access consumers.
The Petitioner also submitted that load factor formula is based on the actual requirement of
load of the consumer. In case maximum demand is lower than the contracted load, then maximum
demand (actual requirement) is considered. In case maximum demand is higher than the contracted
load, contracted load is considered because the consumer has contracted this capacity.
As regards RTS-7 HT industry category load factor, the Petitioner submitted that the overall
Load Factor of HT Industry is 40% and, therefore, load factor based tariff limit of 40% is logical.
This issue had been dealt in detail by the Commission in the in-house paper issued during
the MYT Order for the second Control Period. Since the marginal cost of power is higher than the
average cost of power, therefore, to have cost reflective tariffs, the energy charges should increase
with load factor. Further, the Commission has deliberated on this issue in detail in Chapter 5 of the
Order.
2.9 Fuel Charge Adjustment
Shri R. K. Singh of Tata Motors Limited submitted that UPCL brings office memo of fuel
charges adjustment and additional energy charges in between the months instead of beginning of
quarter impacting the power purchase planning and due to this consumers have to pay FCA
charges to UPCL that are not planned at the beginning of the month. He further submitted that this
results in additional tariff hike of 2.24%.
M/s Shiv Shakti Electricals submitted that the fuel Charges should not be charged to the
consumers and should be pre-included in the tariff.

As regards imposition of fuel charge the Petitioner submitted that Section 62(4) of the
Electricity Act, 2003 mandates the imposition of Fuel Charge Adjustment for recovery of additional
power purchase cost over and above the approved power purchase cost. Accordingly, FCA is being
charged by the Petitioner only when the actual power purchase cost in any quarter is more than the
approved/considered power purchase cost for that quarter in the Tariff Order.
The Commission during the tariff proceedings projects the cost of power purchase on the
basis of past year variable charges which in turn depends upon the fuel cost. The Commission
carries out due diligence while approving the rate of power purchase, however, due to several
unforeseen reasons like fuel price increase, change in royalty and tax structure governing fuel prices
the variable charges of fuel increases which needs to be passed on to the Petitioner as per the
mechanism specified under UERC Tariff Regulations, 2015 in accordance with the provisions of the
Act and numerous Judgments of Hon’ble ATE in the matter. The Commission in this Order has
taken due care that the impact of such increase is mitigated to a large extent by taking suitable rate
of increase in variable (fuel) cost.
2.10 Minimum Consumption Guarantee (MCG)
Commission in its Tariff Order for FY 2005-06 had abolished MCG from consumers. In the tariff
order dated 18.03.2008, the Commission had again introduced monthly minimum consumption
charge over and above the fixed charges/demand charges for the industrial consumers. This clearly
indicates that the industrial consumers are being burdened with an additional charge to
compensate the inefficiency of UPCL in ensuring proper meter reading and billing of its consumers.
In this regard, he requested the Commission to safeguard the interest of the consumers and not pass
on the inefficiencies of the distribution utility to the consumers. He further submitted that the
Commission has been increasing fixed charge/demand charge also almost in every tariff order and
additionally continuing with the provision of minimum consumption guarantee in the tariff to the

industries on the plea of recovery of fixed cost of the licensee which burdens the consumers and is
not justified. Accordingly, he suggested that the Petitioner should be directed to improve its
internal mechanisms to ensure prompt meter reading, billing and diligent recovery of the bills.
Shri Pankaj Gupta of Industries Association of Uttarakhand submitted that UPCL has not
projected revenue receipt on account of MCG. As per the past data, this amount is very low and it
causes heavy burden on the consumers paying MCG. In respect of Cross Subsidy to be within the
range of target latest by the end of year 2010-11, tariffs are within ± 20% of the average cost of
supply. In case of LT, the Tariff is as high as 100% in some cases being subjected to MCG. MCG
would result in wastage of power as the consumer is left with no incentive to save power. As most
of the LT industries are paying MCG, this is resulting in unnecessary extra burden on them. It
requested that the MCG be removed in the current Tariff fixation.
The Petitioner submitted that the total cost of UPCL may be segregated into power purchase
cost and other costs. The other cost is about 10% to 15% of total cost and fixed in nature. This cost
should be recovered through fixed/demand charges.
About 40% of total Power Purchase Cost of UPCL is also fixed cost and is borne by UPCL
whether or not it draws the power from the respective generating station. UPCL has made its
arrangement to supply sufficient power to the consumers but in case the consumer does not
consume power, UPCL is required not to draw some power having fixed cost. This fixed cost needs
to be recovered from the consumers through Minimum Consumption Guarantee Charges.
Minimum Consumption Guarantee has been proposed at very low level of consumption, i.e.
at 6.85% load factor for non-domestic category and LT industry category and at 13.70% for HT
industry category. In case during certain months, actual consumption is less than MCG, MCG is
charged in those months. Any excess of billed consumption over actual consumption or minimum
consumption, whichever is higher is adjusted at the end of the financial year.
The Commission has revisited the issue of levy of MCG in this Tariff Order. For reasons as
discussed in Chapter 5 of this Order, the Commission has abolished MCG and the same shall not be
applicable to any consumer category from April 01, 2018 onwards.
2.11 Rebate and Incentives
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. submitted that since
many HT consumers are required to pay their monthly bill in advance every month, an incentive of
1% per month on the amount which remains with the licensee at the end of calendar month
(excluding security deposit) may be credited to the account of the consumer after adjusting any
amount payable to the licensee. He also requested that an incentive for prompt payment at 0.25% of
bill amount (excluding arrears, security deposit, meter rent and Government levies, viz. Electricity
Duty and Cess) may be given in case the payment is made at least 7 days in advance of the due date
of payment where the current month billing amount is equal to or greater than Rs. One Lakh.
Shri Pankaj Singh Bora of Galwalia Ispat Udyog Pvt. Ltd. submitted that high voltage rebate
should be given on power purchase through Open Access. He further proposed to either increase
the voltage rebate from 2.5% to 5% for supply at 33 kV and from 7.5% to 10% for supply at 132 kV
as there are minimum losses at such high voltages.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. suggested that either a
separate tariff slab should be defined for HT consumers connected at high voltage or the rebate
should be allowed to compensate the tariff cost. He further suggested to increase the voltage rebate
to 7.5% for supply at 33 kV and 12% for supply at 132 kV and above. He further suggested that
cross subsidies should be eliminated in phased manner instead of being increased every year.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. submitted that most
SERCs provide incentives on higher load factor to HT consumers. If the consumer draws maximum
power in the same contract demand, licensee’s average power purchase cost and consumer’s
average tariff will automatically get reduced and therefore the gain on account of reduction on
average power purchase cost can be passed on to the consumer through load factor incentive.
Higher load factors also result in maximum utilization of transmission and distribution assets, thus
resulting in average lower costs for the license. He therefore proposed for a rebate of 5% on normal
energy charge for monthly load factor between 65-70% and rebate of 10% on normal energy charge
for monthly load factor of 70% and above.

Shri R.S. Yadav of India Glycols Ltd. submitted that the current high voltage rebate for 132
kV should be increased from 7.5% to 13.5% as the line losses in these categories are not more than
2% when compared to the average losses of 15.50%. He further suggested that open access
consumers at high voltage should be charged only transmission loss of 2% in place of average
distribution loss.
M/s BST Textile Mills Pvt. Ltd., submitted that the voltage rebate proposed for 33 kV
customers should be increased to 5% from the current rebate of 2.5%.
Shri Pramod Singh Tomar of PSR Innovations LLP has submitted that UPCL should also
provide rebate to 11 kV connections also.
Shri Vikas Jindal of Kumaun Garhwal Chamber of Commerce & Industry submitted that
tariff to the consumers is fixed at average billing rate which consists of demand and energy charges
while, rebate is being allowed presently for energy charges only. A few years back, the Commission
had been allowing HV rebates in the tariff on rate of charge, i.e. demand and energy charge. In line
with the same, he requested to consider the mechanism for allowing HV rebate on rate of charge,
i.e. on demand and energy charges in the tariff order.
Shri Jatinder Kumar of Air Liquide India submitted that based on the projections of
Industrial growth at 1.3% in the State as submitted by the Petitioner, the rebate should be increased
by 10% to stimulate Industrial growth.
The Petitioner submitted that presently, no consumer is required to make advance payment
of his electricity dues. The Petitioner also submitted that the rebate for prompt payment may be
considered by the Commission at the rate of 0.19% of bill amount (10% annual rate/365 days x 7
days).
The Petitioner further submitted that there is no correlation of distribution losses with
contracted load and demand charges and, therefore, voltage rebate should not be admissible on
demand charges.
As regards industrial growth rate, the Petitioner submitted that the reduced growth rate for
FY 2016-17 in industrial category has been largely been due to external reasons, i.e. Central
Government policies and decisions. Additionally, during first six months of FY 2017-18, data for
energy sales shows revival in sales with an average increase of 4.5% in the current year as compared
to six months sale of FY 2016-17. The Petitioner is already making efforts to boost industrial sales.
As regards high voltage rebate on open access energy, the Petitioner further submitted that
high voltage rebate is admissible on the Energy Charges and no energy charges is payable on the
open access energy. In the absence of voltage wise losses, which is a mix of Technical Losses and
Commercial Losses, the Distribution Losses are required to be charged on average basis from all
categories of consumers as well as open access consumers.
The Petitioner further submitted that the tariff of HT consumers (above 75 kW) is
determined at base voltage level of 11 kV. In Tariff Order dated April 10, 2014 the high voltage
rebate was revised from 1.5% to 2.5% for supply at 33 kV and 5% to 7.5% for supply at 132 kV and
above respectively. Accordingly, voltage rebate is admissible for supply at 33 kV level and above.
The Commission in its Order dated April 10, 2014 considering the requests made by various
stakeholders and UPCL’s response on the same had modified the provisions of voltage rebate and
the Commission feels that the provisions of the prevalent voltage rebate are appropriate.
As regards the suggestion for incentive for timely payment, the Commission has already
dealt with the matter in its Tariff Order for FY 2003-04 which is being reproduced as under:
“The Commission finds that consumers already enjoy sufficiently long credit for the supplies made to
them. Petitioner has intimated the Commission that even for consumers being billed on monthly basis
the time lag between the first day of supply and actual payment is about two months, resulting in
interest free credit for an average period of 45 days for the entire billed amount. For consumers being
billed once in two months, the interest free credit period works out to around two months. This
existing arrangement itself is quite generous and no further concessions seem called for. Allowing
consumers rebate for timely payment and booking the cost of it on tariff through expenses incurred,
gives no real advantage to consumers and is only an exercise of smart packaging. The Commission has
therefore decided to do away with the system of rebate for timely payment of the bills by consumers.”
The above views of the Commission are relevant even in today’s context. Besides, levy of
Delayed Payment Surcharge is a mechanism to induce the consumers to pay the bills on time failing
which they would be liable to pay surcharges.

As regards the voltage rebate for open access, the Commission agrees with the Petitioner’s
views that as no energy charges are payable by open access consumers to UPCL and hence, the
issue of rebate is not applicable.
As regards load factor based tariff for HT industry consumers, the Commission has dealt
with this issue in detail in Chapter-5 of the Order.
2.12 Energy Sale Forecast
Shri Amit Joshi submitted that the Petitioner has not clarified whether the sales of 5508.03
MUs made to HT Industrial category has been adjusted for power consumed by the same through
open access. He further submitted that percentage growth rate in industrial sales of UPCL have
decreased from 6.48% in FY 2015-16 to 1.55% in FY 2016-17 and, therefore, prudent steps should be
taken by UPCL to increase sale to industrial consumers for commercial viability of the company.
Compound Annual Growth Rate (CAGR) over the past 5 years has been considered by UPCL and
this may not be a good approach for energy sales during FY 2017-18 and FY 2018-19 due to recent
demonetization and consequent recession in the market. He further submitted that UPCL has
adopted the similar approach for projection of category-wise connected load and no. of consumers,
i.e. adjusted trend analysis method. The assumed growth rate in load of HT industries as 5.83%, LT
as 13.09% and for non-domestic as 9.47% for FY 2018-19 cannot be achieved due to recent
demonetisation factor.
As regards the decrease in industrial sales, the Petitioner submitted that decrease in growth
rate of industrial sales during FY 2016-17 is mainly due to demonetization factor. It has further
submitted that in FY 2017-18 (April to October) the percentage growth in sales to industrial category
is 4.11% (from 3438.31 MU in FY 2016-17 to 3590.12 MU in FY 2017-18)
The Petitioner further submitted that the impact of demonetization was for short term and
will not affect the economy in future. In this connection, the Petitioner submitted that the extract of
Economic Survey 2016-17 which is as under:

“We expect real GDP growth to be in the 6.75 to 7.5 percent range in FY 2018. Even under this
forecast, India would remain the fastest growing major economy in the world.”
The Petitioner submitted that it has used the adjusted trend analysis method for projecting
the category-wise connected load and number of consumers in line with the approach followed by
the Commission. In case of HT industries, it has considered a 1% load growth (4 month growth in
FY 2017-18) over FY 2016-17. Further for LT category, it has considered a 5.85% load growth (3 year
CAGR), while for non-domestic category, it has considered a nominal increase of 1% over FY 2016-
17 for projecting the load in FY 2017-18 and FY 2018-19.
The Petitioner further submitted that for the purpose of projecting the sales for FY 2017-18
and FY 2018-19, it has also considered a mix of long and medium term trend in energy consumption
in conjunction with the growth in connected load and number of consumers along with any recent
trend (first four months of FY 2017-18 which show revival in sales for few categories) to estimate
future consumption across the consumer categories.
Further, the Petitioner in Tariff Petition has also provided detailed explanation for
considering the respective growth rates in each category. For RTS-5 (GIS), 10% growth rate has been
considered based on the consistently increasing load along with historical trends for sales. Similarly,
for LT industry, the growth rate has been considered based on the increase in connected load and y-
o-y growth in sales. The Petitioner further submitted that in case of HT, it was observed that
although the sales during FY 2016-17 was on the lower side due to recent government policies, the
category showed revival during first four months of FY 2017-18 and, hence, a growth rate of 4.5%
has been considered.
The Commission has duly scrutinised and analysed the sales projected by the Petitioner and
has approved the category-wise sales based on past trends including recent trends and considering
the other factors submitted by the Petitioner and other stakeholders as elaborated in Chapter 4 of
this Order. It has been found that the Petitioner has duly adjusted the power drawn under open
access by industry consumers while projecting the sales in the said category. The Commission is of
the view that for planning purposes, the sales projections should be based on unrestricted sales and,
accordingly, the Commission had projected the unrestricted sales.

2.13 Cost of Supply and Cross Subsidy
Shri Jatinder Kumar of Air Liquide India submitted that the Cross Subsidy surcharge should
be retained at Rs. 0.49 per unit against the proposed hike of Rs. 0.57 per unit.
The Petitioner submitted that in accordance with Section 42(2) of the Electricity Act, 2003,
open access may be allowed only on payment of existing level of cross subsidy by the Consumer.
This cross subsidy is derived by reducing the average tariff from the tariff of the subsidizing
category.
The Petitioner submitted that presently, voltage wise / category wise losses are not available
and Category wise Tariff has been calculated on the basis of average cost of supply and permissible
level of cross subsidy, which is as per Regulation 91 of the UERC Tariff Regulations, 2015.
The issue of cross-subsidy surcharge applicable on open access consumers is in accordance

with the Electricity Act, 2003 and the Open Access Regulations of the Commission and has been
deliberated in Chapter 5 of the Order.
2.14 Continuous Supply
Shri R.S. Yadav of India Glycols Ltd. submitted that the 15% surcharge for continuous
supply is very high and should be reduced to 5% as adequate power is available in the State. No
other State charges any additional amount for continuous supply except Punjab which charges 10
paise per unit. Accordingly, he suggested that the Petitioner should reduce surcharge so that more
consumers may opt for continuous power supply which may result in increase in revenue
realization by UPCL.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. and Shri V.K. Aggarwal
of Balaji Action Buildwell submitted that the industries availing continuous power supply are

beneficial for the licensee as the utility may enter into a long-term PPA with a power producer. This
leads to better power purchase planning and reduction in cost of power purchased for such
consumers. Charging premium for continuous power is unjustifiable on account of poor power
purchase planning by the utility and, therefore, it was requested to completely remove or reduce
the continuous supply charge from the existing level of 15% to 5%. They further submitted that
continuous supply surcharge should be made free to the consumers having their connection on 132
kVA and connected load of 10 MVA and above.
Shri Pravin Ahire of Finolex Cable Limited and Shri Anuj Garg of M/s Carborundum
Universal Limited submitted that charging premium for continuous power is unjustifiable and,
therefore, it was requested to completely remove continuous supply charge from the existing level
of 15%, as adequate power was available in the State.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. further submitted that in
case of power surplus scenario in the State, continuous power charges @ 15% needs to be removed
and instead UPCL should be penalized for non-delivery of 24 x 7 power to its consumers.
Shri Mahesh Sharma of Uttarakhand Industrial Welfare Association submitted that option of
continuous supply should be discontinued and if provided should be given with a surcharge of
15%.
Shri Jatinder Kumar of Air Liquide India and submitted that the continuous supply charge
should be reduced from 15% to 5%.
As regards continuous power supply surcharge, the Petitioner submitted that Para-8.2.1(1)
of Tariff Policy provides that the consumers willing to avail continuous and quality power supply
are required to pay a tariff which reflects efficient costs. This is an additional charge (premium)
payable by the consumer to have the facility of getting continuous supply of power. These
consumers are exempted from load shedding during scheduled/unscheduled power cuts and
during restricted hours of the period of restriction of usages approved by the Commission from
time to time. However, load shedding required due to emergency break-down / shut-down is
imposed on these consumers as and when the situation arises. For the purpose of ensuring
continuous supply, the Petitioner is required to incur extra infrastructure cost as well as

arrangement of energy availability at higher cost which cannot be kept below 15% of energy
charges. Therefore, the Petitioner submitted that such extra cost is required to be recovered from the
consumers availing continuous power supply.
The Petitioner further submitted that for the purpose of ensuring continuous supply, UPCL
is required to incur extra infrastructure cost as well as arrangement of energy availability at higher
cost. Even in case the consumer purchases power through Open Access, UPCL is required to incur
this cost and, therefore, recovery of the same is also required on the Open Access Energy consumed.
The Petitioner further submitted that continuous supply consumers are exempted from load
shedding during scheduled/unscheduled power cuts and during restricted hours of the period of
restriction of usages approved by the Commission from time to time. However, load shedding
required due to emergency break-down / shut-down is imposed on these consumers as and when
the situation arises. Further, UPCL has been making consistent efforts to reduce load shedding. The
Petitioner further submitted that load shedding during FY 2016-17 has been less than 1% of the
overall energy demand at the State periphery. The load shedding for FY 2017-18 upto February is
only 30.60 MU, which is about 0.25% of overall demand.
The Commission appreciates genuine suggestions on reduction of continuous supply

surcharge rather than complete abolishment as the State is still facing deficit. As discussed in detail
in Chapter 5 of this Order, the deficit has reduced as compared to previous years especially in
winter months and, therefore, the Commission has decided to reduce the continuous supply
surcharge from 15% of energy charges to 10% of energy charges. The Commission will review the
same once the aforesaid deficit in UPCL’s requirement is completely wiped off.
2.15 Components on ARR and Revenue
2.15.1 Power Purchase Cost
Shri Amit Joshi submitted that the power purchase cost has increased due to the cost of Rs.
350.26 Crore towards banking of power returned . In this regard, he further suggested tha tUPCL
should provide the detail of this amount along with the station-wise quantum. He further
submitted that the Petitioner should provide the clarification regarding the compliance of directive
for including the amount of Rs. 50.88 Crore as directed by the Commission in Para 3.1.3 of the
Tariff Order for FY 2017-18. He further submitted that the Petitioner in its main Petition has not
provided the station-wise quantum purchase during FY 2016-17 though it is provided in the
formats. In this regard, he suggested that the Petitioner should provide such details of station-wise
quantum purchase in the main petition of the subsequent filing.
With regard to the power purchase projections for FY 2018-19, Shri Amit Joshi submitted
that the Petitioner has projected availability form NTPC plants on the basis of average generation
of last 3 years. In this regard, he suggested that projections from NTPC thermal stations should be
calculated on the normative PLF as the same depends upon the demand. He further submitted that
the Petitioner has projected availability from Koldam HEP on the basis of average generation of FY
2016-17 and FY2017-18. As the Koldam HEP has been commissioned on July 18, 2015, he suggested
that availability from Koldam HEP should be projected on the basis of the design energy.
Shri Amit Joshi further submitted that average power purchase cost of UPCL is Rs.
3.60/kWh which seems to be on a higher side even after purchasing major portion from Hydro
projects. In this regard, he suggested that UPCL should lower its average purchase cost by
measures like deallocating power from costly stations like Gas plants, THDC, Solar, etc.
power purchase cost has been proposed high at Rs. 5917.14 Crore in FY 2018-19 which is
approximately an increase of 10.71% over the power purchase cost in FY 2017-18. This is despite
considering the impact of cess and royalty in FY 2017-18. He further submitted that the power
procured from co-generation and gas based stations is around Rs. 5.48/unit which seems to be too
high considering that cheaper options are available.
there have been instances of allegations in the past on UPCL for purchase of power from outside at
higher rates with mutual discussion.
Shri Munish Talwar of Asahi India Glass Ltd. submitted that long term contracts/
agreements should be finalized with corporations such as NTPC, NHPC, THDC, UJVNL and
SJVNL to control the power purchase cost with the rise of power demand within the State.

Shri Jatinder Kumar of Air Liquide India submitted that UPCL has projected power
purchase cost of Rs. 5161 Crore which is higher by Rs. 469.72 Crore in comparison to FY 2017-18. He
further suggested that UPCL should follow merit order dispatch for reducing the Power purchase
cost.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. submitted that UPCL is
purchasing electricity at a higher cost and then passing it on to the consumers in the form of higher
tariff.
The Petitioner submitted that variation in power purchase cost is an uncontrollable factor
and the UERC Tariff Regulations, 2015 allows for pass-through of impact of uncontrollable factors.
The Petitioner’s claim of Rs. 4971.03 Crore is the actual power purchase cost incurred in FY 2016-17.
Therefore, the Petitioner requests the Commission to allow the power purchase cost for FY 2016-17.
The Petitioner submitted that the energy requirement for FY 2018-19 is projected as 14348.36
MU. Also, it has made firm power arrangement of 5076.82 MU from Central Sector, 4287.21 MU
from UJVN Ltd. and 4984.33 MU from State IPPs. In order to provide quality and uninterrupted
power supply to the consumers of the State, it has executed power purchase agreement for 428 MW
from gas based generating stations situated in the State. The power of these generating stations is
available round the year and no PGCIL charges and losses are payable on this energy. Therefore,
the cost of this power is not more than the cost of power as procured from outside the State. Also,
the Petitioner further submitted that it has executed a power purchase agreement for 70 MW from
hydro generating station situated in Himachal.
Keeping in view the surplus power during summer months from the above generating
sources, the Petitioner has made an arrangement of banking of 1063 MU. This surplus power shall
be given in summer months and will be taken back during winter months.
As regards the amount returned in banking of power, the Petitioner submitted that it had
procured energy through banking in FY 2015-16 amounting to Rs. 350.26 Crore and made the
provision in the Accounts for FY 2015-16 for the same and was not claimed in the ARR for FY 2015-
16. The Petitioner further submitted that this energy was returned in FY 2016-17 and, therefore, the
cost provided in the Accounts for FY 2015-16 has been claimed in the ARR for FY 2016-17.

The Petitioner further submitted that the energy received through banking during FY 2014-
15 for Rs. 299.37 Crore were returned during FY 2015-16 and, therefore, there was an increase of Rs.
50.88 Crore towards provision for power purchase during FY 2015-16. The Petitioner further
submitted that it had not claimed this provision in the ARR for FY 2015-16, however, the
Commission in its Tariff Order had reduced such amount of Rs. 50.88 Crore from Petitioner’s claim
and thereafter, in its Order dated 03.08.2017 allowed the same. The Petitioner further submitted that
no claim of power purchase for FY 2015-16 has been made in the ARR and Tariff Petition for FY
2018-19 and, therefore, there was no need to mention the same in the main Petition.
As regards the power availability from Koldam HEP, the Petitioner submitted that it has
projected the gross units for FY 2018-19 on the basis of average generation of last 3 years in line with
the methodology followed by the Commission in Tariff Order for FY 2017-18. In case of Koldam
HEP, since the plant was commissioned on July 18, 2015, it has considered the average monthly
generation of last 2 years during which the plant was operational.
The Petitioner further submitted that it has been making continuous efforts to reduce its
overall power purchase cost, and, therefore, all the power purchases are made with the approval of
the Commission. The Hydro Power of the State includes cess, royalty and water tax imposed by the
State Government.
As regards the higher power purchase cost, the Petitioner submitted that the average power
purchase cost for FY 2017-18 and FY 2018-19 has been estimated/proposed at Rs. 3.93/kWh and Rs.
4.12/kWh, respectively. Thus, there is an increase of only of 4.83%. In this regard, the Petitioner
further submitted that the average rate projected for FY 2018-19 is higher mainly on account of
considering the revised tariffs for central generating stations, additional impact of cess and royalty
for MB-II and provisional tariffs for upcoming stations. Further, as regards the higher cost of power
procurement from co-generating plants, the Petitioner submitted that the power procurement from
co-generating plants are considered in order fulfil its RPO obligation.
As regards comment on costly power from gas based plant, the Petitioner further submitted
that power of these generating stations is available round the year and no PGCIL charges and
losses are payable on this energy. Therefore, the cost of this power is not more than the cost of
power as procured from outside the State.

The Petitioner further submitted that it follows merit order dispatch for power procurement
planning. It saves money on power purchase cost from the data forecasting being done through
expert consultant M/s Quenext. The benefit from real-time monitoring of power purchase is being
passed onto the consumers in the form of savings in net overall power purchase cost.
The Petitioner submitted that all the power purchases are made through a transparent
process as specified in the Act, Regulations and Orders approved by the Commission.
The Petitioner further submitted that the overall rate of power from NTPC for FY 2015-16
was Rs. 3.19/unit whereas the same rate of FY 2016-17 (upto December) is Rs. 3.38/unit. The
Petitioner submitted that there is no reduction in the power purchase rate of NTPC.
The Petitioner also submitted that it is very important for a distribution utility to have a
right mix of short and long term power. There may be a period when the rate of power from short
term market is higher than firm sources. There is no guarantee that the rate in short term market
always remains lower as compared to the rate of firm sources. Furthermore, there may be instances
when short term power may not be available during certain period. At that time, firm sources of
power are the best option. It is always advisable for a Discom to keep more and more power
available from firm sources in order to keep the power purchase cost minimal and for the purpose
of energy security.
The Petitioner further submitted that while taking assumptions for projecting the power
purchase cost from new stations, UPCL has tried to be as realistic as possible.
The issues related to source wise power purchase quantum and costs have been deliberated
by the Commission in Chapter 3 and 4 of this Order.
2.15.2 Return on Equity
Shri Munish Talwar of Asahi India Glass Ltd. submitted that the evaluation criteria to
compute calculations of Return on Equity has to be explained as the difference in the values of FY
2017-18 and FY 2018-19 is coming around Rs. 20 Crore.

Shri Pankaj Gupta of Industries Association of Uttarakhand submitted that UPCL always
comes out with new methodologies for calculating Return on Equity inspite of the clear approach
provided by the Commission, and, therefore, UPCL has claimed additional RoE of Rs. 28 Crore for
the past years. He further requested to calculate Return on Equity in line with the earlier approach
of the Commission.
The Petitioner submitted that return on equity has been calculated in accordance with the
UERC Tariff Regulations, 2015. The opening equity for FY 2017-18 has been considered based on the
closing equity for FY 2016-17, i.e. Rs. 453.88 Crore. The addition in equity during FY 2017-18 has
been considered based on the proposed funding of capitalization in the respective year. Therefore,
the opening equity for FY 2018-19 being higher than the opening equity of FY 2017-18, the RoE
computed for FY 2018-19 is higher by approx. Rs. 20 Crore.
The Commission for computation of equity invested in creation of capital assets, first
considers the amount of loan and grants and thereafter 30% of the balance as equity and remaining
amount as normative loan. In this regard, the Petitioner opined that such approach is not correct as
there are 30% equity invested in the assets financed through 70% REC Loan/ District and State Plan
Loans which is not being considered by the Commission.
The Petitioner further submitted that as against approved opening equity of Rs. 285.58 Crore
for FY 2016-17, it has submitted the revised computation of equity as Rs. 402.71 Crore and claimed
Rs. 28.07 Crore differential for the period from FY 2012-13 to FY 2016-17. The Commission in its
Order dated 03.08.2017 had directed the Petitioner to reconcile the figures submitted in the previous
tariff proceedings with that claimed in the review Petition and submit the same in the next tariff
proceedings. In compliance to the directive, the Petitioner submitted break-up of revised financing
from FY 2012-13 onwards in the instant Tariff Petition. Accordingly, the Petitioner has requested the
Commission to approve the revised submission and approve the return on equity thereby
submitted.
The issue of Return on Equity has been deliberated by the Commission in Chapter 3 and 4 of
this Order.

2.15.3 Operation & Maintenance Expenses
Shri Amit Joshi submitted that the Petitioner has claimed an amount of Rs. 3.05 Crore in
FY 2016-17 and Rs. 3.12 Crore for FY 2018-19 in A&G expenses towards services of M/s
Quenext. In this regard, he submitted that the Petitioner should meet such type of expenses
from its reserve & surplus. He further submitted that the average WPI of preceding three years
from FY 2013-14 to FY 2015-16 is 0.93% in place of 1.83% and requested to consider the same. He
also submitted that the average WPI of preceding three years from FY 2014-15 to FY 2017-18 is
(-)0.22% in place of 1.07% and requested the Commission to consider the same for tariff
determination for FY 2018-19.
Shri Munish Talwar of Asahi India Glass Ltd. submitted that the Repair and Maintenance
Cost is escalated by almost 18% with respect to the previous year, which is very high compared to
the present market scenario and inflation index.
Shri Vikas Jindal of Kumaun Gharwal Chamber of Commerce and Industry has submitted
that the Petitioner in its revised submissions for FY 2016-17 has claimed O&M expenses of Rs.
437.32 Crore against actual audited O&M expenses of Rs. 407.60 Crore and this amounts to hike of
Rs. 29.73 Crore. Therefore, the basis of such claims and quantum should be thoroughly scrutinized.
The Petitioner submitted that since the tariff for UPCL is determined on a cost-plus basis,
any additional expenditure for improved power procurement planning has to be recovered through
tariff. The Petitioner has been able to make significant savings on power purchase cost from data
forecasting being done by M/S Quenext, the benefit of which is being passed onto the consumers.
As regards the average WPI, the Petitioner submitted that it has considered the average
growth in WPI as per the 2004-05 series (FY 2004-05 as base). Further, it has proposed R&M
expenses in accordance with Regulation 84(3) of the UERC Tariff Regulations, 2015.
The Petitioner further submitted that in accordance with the UERC Tariff Regulations, 2015,
variation in O&M expenses are controllable factors and, therefore, O&M expenses are allowed on a
normative basis and not on actuals. The Petitioner has been able to reduce its actual O&M expenses

as against the normative O&M charges allowed to the Petitioner. Such gain has been passed onto
the consumers after sharing it as per the methodology laid down in the UERC Tariff Regulations,
2015, thereby reducing the net O&M charges by Rs. 9.91 Crore.
The issue of O&M expenses has been deliberated by the Commission in Chapter 3 and 4 of
this Order.
2.15.4 Interest and Finance Charges
Shri Amit Joshi requested the Commission to not allow interest on GPF as part of interest
expenses as the same is a statutory liability of the Petitioner.
Shri Pawan Agarwal of Uttarakhand Steel Manufacturers Association submitted that inspite
of the fact that interest rates in the country are declining every year, UPCL has proposed Rs. 151.21
Crore in FY 2016-17, Rs. 172.50 Crore in FY 2017-18 and Rs. 207.45 Crore in FY 2018-19 as interest
and financing charges. He further submitted that the average rate of interest has been considered as
12.22% which is too high.
The Petitioner submitted that the Government of Uttarakhand (GOU) in the past has refused
to provide support to UPCL on account of interest on GPF. In this regard, the Petitioner requested
the Commission to issue suitable advisory to the GOU. Therefore, the Petitioner has requested the
Commission to allow interest on GPF since this is a statutory liability of the Petitioner.
As regards the higher interest and financing charges, the Petitioner submitted that the rate of
interest on new loans is in the range of 11.5%-12.00%. Even though the interest rates in India have
declined, there are certain old loans on which the rate of interest are comparatively higher. The
weighted average rate of interest at 12.22% considered by the Petitioner is based on the actual
interest being paid in FY 2016-17.

The issue of interest charges has been deliberated by the Commission in Chapter 3 and 4 of
this Order.
2.15.5 Depreciation
UPCL has calculated depreciation on opening and closing values of gross fixed assets (GFA) for FY
2016-17 as Rs. 118.74 Crore against approved depreciation of Rs. 125.32 Crore by the Commission
thereby saving Rs. 6.58 Crore over approved Depreciation.
The Petitioner submitted that it has claimed depreciation in line with the provisions of
UERC Tariff Regulations, 2015. It has considered the closing GFA for FY 2015-16 as approved by the
Commission in Tariff Order dated 29.03.2017. The rate of depreciation as per audited accounts has
been applied on the opening assets for FY 2016-17 after reducing the value of grants and consumer
contribution / deposit works.
The issue of depreciation has been deliberated by the Commission in Chapter 3 and 4 of the
Order.
2.15.6 Non Tariff Income
Shri Amit Joshi has submitted that Petitioner has not considered full rebate/incentive of Rs.
44.07 Crore as shown in the audited accounts. Further, the Commission in its previous Orders had
already clarified that full amount of rebate should be considered under NTI in accordance with the
ATE Judgment dated May 18, 2015.
Shri Amit Joshi on the ARR Petition submitted that in non tariff income for FY 2018-19 the
Petitioner has not considered delayed payment surcharge by citing the reason of certainty. He
further suggested that the same may be considered on the basis of average of last 2-3 years.

The Petitioner has considered the full amount of rebate/incentive under the non-tariff
income after adjusting for the interest on overdraft amount as per the audited accounts in FY 2016-
17. The Petitioner further submitted that this has been done as UERC allows interest on working
capital on normative basis and amount towards overdraft facility is primarily utilized for the
purpose of availing the maximum rebate from the generators, which is working capital
management of the Petitioner.
Further, the Petitioner submitted that it has not considered delayed payment surcharge since
the collection from delayed payment cannot be ascertained for the future with certainty. Further,
the Petitioner in Tariff Petition has also provided detailed justification for additional expenditure
due to delay in payment by the consumer as under:
“Additionally, the Petitioner has prayed to the Hon’ble Commission not to include delayed payment
surcharge as the Working Capital is approved on normative basis as per the normal billing and
collection cycle. Therefore, any delay in payment of the electricity bill by the consumer results in
additional working capital requirement for the Petitioner. In view of the fact that this additional
working capital is deployed by the Petitioner from its internal resources / short-term loans, there is an
additional cost which is required to be borne by the Petitioner which is not allowed as per the current
regulations. Therefore, the Petitioner has already requested the Hon’ble Commission to devise a
suitable mechanism for considering the delayed payment surcharge after accounting for the addition
financial burden on UPCL on account of the addition in working capital requirement.”
The issue of non-tariff income has been deliberated by the Commission in Chapter 3 and 4 of
this Order.
2.16 Consumer Security Deposit
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. submitted that for HT
consumers the security amount is provided by obtaining credit facilities from the banks which are
around 11.5% to 12.5% whereas UPCL provides interest on security deposit at a much lesser rates.

UCPL in the ARR has itself shown rate of interest on loans as 11.86%. He further requested to
increase the rate of interest on consumer security deposit from 8.5% to 11.5%.
M/s. BST Textile Mills Pvt. Ltd. submitted that the rule of security deposit of two months
should be changed to maximum of one and a half months at least for consumers paying bills on
time.
Shri V.K. Aggarwal of Balaji Action Buildwell submitted that the security deposit of two
months for industries should be allowed to be furnished by way of bank guarantee to avoid Cash
Flow Problems.
Shri Mahesh Sharma, Uttarakhand Industrial Welfare Association submitted that although
provisions have been made to transfer annual interest on consumer security deposit, no interest is
currently being paid.
Shri G.D. Madhok submitted that security deposit fee for new connection should be equal to
the cost of the meter of about Rs. 350/-, however, UPCL charge the security deposit of Rs. 1000/- to
Rs. 1500/-, which is not justified.
The Petitioner submitted that interest on security deposit is being paid in accordance with
the provision of section 47(4) of the Electricity Act, 2003. The rate of Interest for FY 2016-17 is 7.75 %
p.a. While computing the working capital requirement of the Petitioner, the consumer security
deposit is reduced.
The Petitioner further submitted that security deposits are received from the consumers to
securitize the credit sales made by the DISCOM. In case a consumer defaults in making the
payment of his electricity bills, the recovery of such electricity dues may be adjusted from the
security deposit of the consumer. Further, the Petitioner submitted that initial security deposit at the
time of release of new connection is specified in UERC (Release of new LT Connections,
Enhancement and Reduction of Loads) Regulations, 2013, as follows:
 BPL (Domestic) Consumers : Rs. 100/kW
 Other Domestic Consumers : Rs. 400/kW
 Non Domestic Consumers : Rs. 1000/kW

 Industrial Consumers : Rs. 1000/kW

Thus, the rate of interest on loans and working capital cannot be compared with interest on
security deposits.
The Petitioner further submitted that once the supply is drawn by a consumer, the bill is
generated after a one month period. In 15 days, the bill is received by the consumer and again 15
days time period is given for payment of bills. Thus, a 2 month period is justifiable and is also in
accordance with the UERC Supply Code, 2007.
As regards the interest on security deposit, the Petitioner further submitted that interest is
regularly being paid to the consumers either through adjustment towards additional security
deposit or through adjustment towards electricity dues. This interest is paid every year in the
month of May and June.
The Commission agrees with the replies submitted by the Petitioner in this regard.
2.16.2 Sharing of Gains & Losses
UPCL has claimed loss-sharing against under-achievement of target for distribution losses as
revenue from Consumers. He further requested the Commission to allow the sharing strictly for
controllable factors for which the trajectory has been provided by the Commission in line with the
Regulations.
The Petitioner in this regard has already requested the Commission to pass on the net
impact of sharing of gains/losses on account of such parameters in the ARR of FY 2016-17 in line
with the UERC Tariff Regulations, 2015.
The issue of the sharing of gains and losses have been deliberated by the Commission in
Chapter 3 of the Order while carrying out the truing up for FY 2016-17.
2.16.3 Provision for Bad and Doubtful Debts
Shri Pankaj Gupta of Industries Association of Uttarakhand submitted the following:
a. The Commission has not fixed any norm for bad and doubtful debts.
b. UPCL has not identified and actually written off bad debts according to a transparent
policy approved by the Commission.
c. UPCL is trying to move in its own direction without taking into consideration the
observations of the Commission on bad and doubtful debts.
d. The earlier stand taken by the Commission for bad and doubtful debts should hold
good for this year also.
Shri Vikas Jindal of Kumaun Gharwal Chamber of Commerce and Industry submitted that
the Commission in previous Tariff Orders had disallowed provisioning for bad and doubtful debts
claimed by UPCL due to non-utilization and submission of accounts of previously allowed
provisions to UPCL and had directed the Petitioner for formulation of policy for identifying and
writing off such debts. Further, the Petitioner has claimed bad debts written off of Rs. 35.18 Crore,
however, it has not declared any policy so far. He further submitted that claimed amount of Rs.
35.18 Crore is the amount of late payment surcharge waived off by the Petitioner and such write off
of late payment surcharge cannot be termed as bad debt. In this regard, he requested the
Commission to disallow such claim of Rs. 35.18 Crore and further direct the Petitioner to notify the
policy drafted by the Petitioner, if any, for general information of the consumers.
The Petitioner submitted that Regulation 31 of the UERC Tariff Regulations, 2015 provides
that the Commission may allow a provision for Bad and Doubtful Debts at 1% of the estimated
Annual Revenue subject to the (i) actual writing off of Bad Debts in previous years (ii) the total
amount of such provisioning allowed in the previous years should not exceed 5% of the receivables
at the beginning of the year.
UPCL at the time of transfer of Assets and Liabilities got a provision for Bad and Doubtful
Debts amounting to Rs. 230.01 Crore. UPCL started its functioning w.e.f. November 9, 2011 and the

Commission so far allowed a provision for Bad and Doubtful Debts of Rs. 103.74 Crore to UPCL for
the period upto FY 2015-16. Thus, a total provision allowed by UERC is Rs. 333.75 Crore. The bad
debts actually written off amounts to Rs. 230.44 Crore till FY 2016-17 and the balance provision
available is Rs. 333.75 Crore – Rs. 230.44 Crore = Rs. 103.31 Crore, which is more than 5% of
receivables of FY 2016-17. Accordingly, no provision for Bad Debts has been included in the ARR of
FY 2016-17 and 2018-19. However, keeping in view the actual Bad Debts Written Off amounting to
Rs. 230.44 Crore, UPCL has requested the Commission to allow the Bad Debts Written Off.
Further, the Petitioner submitted that it has not claimed the bad debts written off of Rs. 35.18
Crore in the ARR for FY 2016-17. Additionally, as per Commission’s directive, the Petitioner has
drafted a Policy for provisioning & writing off of Bad and Doubtful Debts which was also enclosed
along with the Petition. Accordingly, the Petitioner has requested the Commission to approve this
scheme and also authorize it to write off the receivables received under the transfer scheme as per
the provisions of the said policy.
The issue of the provision for Bad & Doubtful debts has been deliberated by the Commission
in Chapter 3 and 4 of the Order.
2.17 Capital Expenditure
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd., Shri Vikas Jindal of
Kumaun Garhwal Chamber of Commerce & Industry submitted that UPCL in its filing of Tariff
Petitions proposes capital expenditure on various measures for controlling losses, but it does not
provide the target and actual work executed. These measures directly affect the consumers, in way
of capital expenditure (loans thereon and interest payment). Accordingly, they requested that
comparison of such work undertaken and accomplishment figures be shared with consumers.
Shri Munish Talwar of Asahi India Glass Ltd. submitted that capital expenditure during FY
2017-18 is projected to be Rs. 630 Crore and it is proposed to be Rs. 986 Crore during FY 2018-19.
Such increase of Rs. 336 Crore in one year is not viable from any aspect. He further submitted that

interstate and intra state transmission charges for FY 2018-19 have been projected to the tune of Rs.
755.59 Crore, which is very high.
As regards the higher capital expenditure, the Petitioner submitted that it has provided
details of scheme-wise capital expenditure proposed to be carried out in the remaining months of
FY 2017-18 and FY 2018-19. Since Central Govt. schemes such as R-APDRP, DDUGVY etc. are
expected to be completed by the end of FY 2018-19, therefore, the capitalization in FY 2018-19 is on
the higher side. The Petitioner further submitted that the capital expenditure has been proposed to
cater continuous and quality supply to the existing and prospective consumers of the State.
As regards the higher transmission charges, the Petitioner submitted that transmission
charges of Rs. 755.59 Crore for FY 2018-19 is projected on the basis of ARR approved by the
Commission for PTCUL and SLDC in MYT Orders dated 05.04.2016.
The Petitioner further submitted that the details of year wise capital expenditure and
improvement in collection (productivity) is mentioned herein below:
Table 2.1: Details of year wise capital expenditure and improvement in collection
(productivity) submitted by the Petitioner
Cumulative Capital Increase in per Improvement in Rate of
Input Energy
Year Investments unit Collection Productivity Return
Rs. Crore Rs. MU Rs. Crore %
A B C D (B*C) E (D/A)
2008-09 252.97 0.10 7,631.44 73.48 29.04%
2009-10 503.68 0.21 8,280.09 170.67 33.88%
2010-11 768.67 0.26 9,249.42 238.99 31.09%
2011-12 1,070.61 0.30 10,310.64 311.38 29.08%
2012-13 1,327.58 0.39 10,789.11 417.91 31.48%
2013-14 1,626.25 0.45 11,216.31 505.90 31.11%
2014-15 2,090.42 0.49 11,888.23 577.12 27.61%
2015-16 2,622.34 0.65 12,559.60 822.21 31.35%
2016-17 2,860.63 0.62 12,688.46 789.50 27.60%
Total 13123.15 3907.15 29.77%
Average Rate of Return on Investments- 3907.15/13123.15= 29.77%
The Petitioner also submitted that it is clear from the above details that UPCL has earned a
healthy return of 29.77% on its investments. The benefit of all the improvement as mentioned herein
above has been passed on to the consumers of the State.

The Commission has duly scrutinised the actual and proposed capitalisation and each and
every cost element of APR for FY 2017-18 and Revised ARR for FY 2018-19 in accordance with the
provisions of UERC Tariff Regulations, 2015 and the same has been discussed in Chapter 3 and 4 of
the Order.
2.18 Truing-up for Past Years
Shri Pankaj Gupta of Industries Association of Uttarakhand submitted that the shortfall in
revenue as against the revenue projected by the Commission is mainly due to load shedding on
industrial consumers. Industrial consumers pay the highest tariff and they are subject to maximum
rostering resulting in shortfall in revenue for UPCL. In other States, rostering of industrial
consumers is done as the last measure to maintain grid balance.
As regards the shortfall in revenue, the Petitioner submitted that the deficit for FY 2016-17 is
mainly on account of the fact that expenditure were allowed less than the actual expenditure
incurred for the year. Similarly the tariff revenue was considered more than the actual revenue
earned by UPCL. The Petitioner further submitted that the deficit of revenue amounting to Rs.
320.38 Crore has been computed and claimed by UPCL. Further, the Petitioner has been making
consistent efforts to reduce load shedding. The load shedding during FY 2016-17 has been less than
1% of the overall energy demand at the State periphery. Therefore, during FY 2016-17 the Petitioner
has been able to cater to the total energy requirement in the State with a marginal demand-supply
gap.
The Petitioner submitted that all the information with respect to power purchase cost for FY
2016-17 as specified in the Regulations and as desired by the Commission during this tariff
determination exercise has been/is being provided to the Commission for examination at their
level.

The Commission has duly scrutinised each and every element of Truing up for FY 2016-17 in
accordance with the provisions of UERC (Terms and Conditions for Determination of Tariff)
Regulations, 2015 and the same has been discussed in Chapter 3 of this Order.
2.19 Distribution Losses
Shri R.S. Yadav of India Glycols Ltd. submitted that the voltage-wise losses to be arrived at
the HT tariff have not been furnished by UPCL till date even after the repeated directions by UERC
for the past four years.
Shri Vikas Jindal of Kumaun Garhwal Chamber of Commerce & Industry, Shri Shakeel A
Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd., submitted that in almost in all Tariff Orders,
the Commission had been directing the licensee to workout the actual voltage- wise, category- wise
losses and cost of supply for fixation of category-wise tariffs. However, UPCL has failed to comply
with the direction. On this account in the Tariff Orders issued so far, the Commission had been
assuming losses at HT level to arrive at the cost of power purchase at HT level for each category
getting supply at HT based on the pooled average system losses of the licensee approved by the
Commission for the concerned financial year. They requested the Commission to take a serious note
of such non-compliance on the part of the UPCL on a repeated basis and fix the tariff for consumer
taking HT level losses on a rational basis.
reduction of 0.5% proposed by UPCL in distribution losses in FY 2018-19 is too less with new and
better technology available to utilities.
Shri Munish Talwar of Asahi India Glass Ltd. submitted that open access charges,
transmission and distribution Loss charges should not be applicable to consumers connected to
High voltage end (132 kV) as losses in EHT Line (132 kV and above) remains negligible.
Shri Munish Talwar of Asahi India Glass Ltd. submitted that UPCL should develop more
cohesive methods to improve billing, metering and collection efficiency thereby decreasing
Distribution losses to much higher values than mentioned. In this regard, he has suggested measure

like replacement of mechanical meters with Electronic meters, R-APDRP scheme etc. that will yield
positive results.
Shri Pankaj Gupta of Industries Association of Uttarakhand submitted that UPCL should be
directed to carry out energy audit at Sub-station level and also at the different voltage levels
separately so that actual reason of losses can be ascertained.
Commission had specified a trajectory of loss reduction every year for the utility, but the Petitioner
has failed to achieve the targets on year to year basis. Any under-achievement by the distribution
utility cannot be passed on to the consumers in tariff.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. submitted that the
distribution losses projected by UPCL are 16.68% against the Commission approved 15%. He
requested the Commission to fix the target of 14.50% distribution losses and a meagre 2% loss
reduction for the coming year. He further suggested that distribution losses shall be determined for
different category consumers separately.
Shri R. K. Singh of Tata Motors Limited and Dr. Vijay Dhasmana, Chairman, CII
Uttarakhand State council submitted that the distribution losses achieved by UPCL are 16.68% as
against 15.00% approved by the Commission. In this regard, he requested the Commission to not
allow any tariff hike and direct the Petitioner to improve performance with stringent targets.
M/s Hero Motocorp Ltd has submitted that currently the Petitioner imposes distribution
loss of 14.75% on the 66 kV and above voltage level to open access consumers connected to PTCUL
Transmission System. It has further submitted that as other States do not impose distribution losses
in EHT category, the Petitioner in instant Tariff Petition has proposed to increase the distribution
loss level to 15.50%. Further, it was submitted that for most of the industries in Uttarakhand tax
benefit period is also nearing to end in March, 2018 and the proposed increase will burden the
consumer and hence, it requested the Commission to avoid the proposed Tariff hike.
M/s Shiv Shakti Electricals submitted that a vigilance team should be made in order to
prevent electricity theft. Further, Shri Shiv Narain Baluni of Nehru Colony Residents’ Welfare
Society submitted that the distribution losses / electricity theft should be reduced.

Shri Vijay Singh Verma of Kisan club submitted that UPCL should install meters with
modem at line junctions in order to reduce line loss in rural areas. He also submitted that UPCL can
save Rs. 100 Crore approximately by reducing its distribution losses by 1%. Also, the industries and
agriculture in the State accounts for 60% load and 5% load of electricity, respectively, and, therefore,
losses in the State should be minimum. He also suggested that distribution and commercial losses
should be submitted separately.
Shri Pankaj Gupta of Industries Association of Uttarakhand submitted the following:
a. UPCL had been claiming in its Petitions that the Distribution Loss trajectory specified by
the Commission is unachievable and unrealistic. The whole focus of the Electricity Act,
2003 was on efficient use of resources and reduction of Distribution Losses which was
the most important goal envisaged in the Act.
b. In Uttarakhand, the sale of energy to industrial consumers has increased from 28% in FY
2004-05 to 55% in FY 2016-17. Therefore, the loss level should be much lower. It is
generally accepted that the losses incurred in the distribution to these industrial
consumers cannot be more than 3%-4%. With such lower loss levels of industrial
consumers, the overall losses should be much lower than the target level. If the losses at
all levels other than industrial consumers are seen, then these losses are actually
increasing.
c. The Commission had fixed the loss reduction target and directed UPCL to carry out
Energy Audit to which UPCL has not complied. UPCL should be directed to carry out
Energy Audit at S/s level and also at different voltage levels separately so that the actual
reason for losses can be ascertained and action be taken to bring down the losses to
target level.
d. The Commission should appoint an agency for carrying out the investigation of losses
and energy audit. If the HT consumers are consuming more than 50%, whose losses
should not be more than 5%-6%, the losses in other categories are more than 45%. This is
enough reason for proper investigation under Section 128 of the Electricity Act, 2003.
e. UPCL should convert their S/s into profit cost centres and any S/s found to be losing
money should be subjected to penalties.

The Petitioner submitted that presently, voltage wise/category wise losses are not available
and in accordance with Regulation 91 of the UERC Tariff Regulations, 2015 category wise tariff has
been calculated on the basis of average cost of supply and permissible level of cross subsidy.
Further, the Petitioner submitted that it is in the process to calculate the voltage wise cost of supply
as per the directive of the Commission. Further, in absence of availability of voltage wise losses,
which is a mix of technical losses and commercial losses, the distribution losses are required to be
charged on average basis from all category of consumers as well as open access consumers.
The Petitioner submitted in compliance to the direction of the Commission, the Petitioner
had appointed an independent consultant to undertake the energy audit of UPCL and to determine
the distribution and AT&C losses for FY 2015-16. As per the report of consultant, the distribution
losses are 18.33% for FY 2015-16 as against the 18.01% recorded in the Petitioner’s Commercial
diary. This is indicative of the actual distribution losses of UPCL for FY 2015-16.
The Petitioner submitted that the trajectory of distribution losses fixed by the Commission
(for FY 2016-17:15%, 2017-18: 14.75% and 2018-19: 14.50%) is not based on any study and the
Commission in its Tariff Order dated 05.04.2016 had observed as follows:
“…and more so in the absence of any energy audit study and considering the ground realities, the
Commission decides not to modify the opening loss for FY 2016-17.”
Further, the Petitioner conducted energy audit for FY 2015-16 through a consultant that
found the distribution losses as 18.33% as against the actual recorded losses of 18.01%. As the
recorded distribution losses of UPCL were found very near to actual in the study of energy audit,
UPCL requested the Commission to approve/revise the level of Distribution Losses as follows:
Table 2.2: Revised Level of Distribution Loss proposed by the Petitioner

Years 2016-17 (Actual) 2017-18 2018-19
Distribution Loss 16.68% 16.00% 15.50%
The Petitioner further submitted that it has been consistently making efforts to reduce its
distribution losses in the last few years. The distribution losses have been brought down from
18.01% in FY 2015-16 to 16.68% in FY 2016-17. Since reduction below 20% distribution loss levels is
extremely difficult, it has proposed a realistic level of Distribution Losses at 16% and 15.50% for FY
2017-18 and FY 2018-19 respectively, considering 0.5% reduction in losses.

The Petitioner further submitted that it has taken following measures in order to reduce
losses/curb theft of energy:
 Vigilance Raids are being conducted and cases are being registered under Section 126
and 135 of Electricity Act, 2003. Legal proceedings are being initiated against the
person(s) who is found indulging in theft of electricity.
 Mechanical meters are being replaced by electronic meters.
 All defective meters are being replaced.
 AB cable is being laid in theft prone areas.
The Petitioner also submitted that it is true that the Commission has fixed Distribution
Losses at 14.75% for FY 2017-18 but, these losses have not been fixed keeping in view the existing
level of distribution losses of the company. The actual distribution losses for FY 2015-16 are 18.39%,
hence, it is practically not possible to achieve the loss level of 14.75% in FY 2017-18 and, therefore,
UPCL proposed a realistic level of distribution losses at 16.39% for FY 2017-18 considering 1%
reduction in losses in each year.
The Commission has taken note of the concerns raised by the stakeholders and the
initiatives taken by UPCL for reducing the losses. The Commission would like to clarify that though
the actual distribution losses are higher, the Commission for the tariff purposes have been
considering the distribution loss at the target level approved by the Commission and the same
approach has been continued while approving the true-up for FY 2016-17 as discussed in Chapter 3
of the Order. Further, the Commission had considered the loss reduction target for FY 2018-19 as
approved in MYT Order dated April 05, 2016 while approving the Revised ARR for FY 2018-19.
2.20 Departmental Employees
M/s Shiv Shakti Electricals suggested that all departmental employees should be provided
with only one electricity connection at anyone place and that connection should be online.

Shri Vijay Singh Verma of Kisan Club and Shri G.D. Madhok submitted that electricity is
given at free of cost to the departmental employees of UPCL, UJVNL, and PTCUL, even to the
retired employees, while this rule is not applicable in other departments.
The Petitioner submitted that employees of UPCL are being given the facility of
departmental electricity connection since U.P. State Electricity Board was in existence. Under this
facility, a fixed lump-sum amount is charged from the employees according to their designation
towards electricity charges for electricity supplied to them. Erstwhile UPSEB was unbundled under
the provisions of Uttar Pradesh Electricity Reforms Act, 1999 and Section 23(7) of the said Act
provides “terms and conditions of service of the personnel shall not be less favourable to the terms
and condition which were applicable to them before the transfer”. The same spirit has been echoed
under first proviso of section 133(2) of the Electricity Act, 2003. The benefits for
employees/pensioners as provided in section 12(b)(ii) of the Uttar Pradesh Reform Transfer
Scheme, 2000 include “concessional rate of electricity”, which means concession in rate of electricity
to the extent it is not inferior to what was existing before 14th January, 2000. The rates and charges
indicated above for this category are strictly in adherence of the above statutory provisions. As
UPCL is the successor entity of UPPCL (formed as a result of unbundling of UPSEB), the above
legal provisions are also applicable on it (UPCL).
The Petitioner further submitted that as per the prevailing orders, the employees and
pensioners of UPCL can have only one departmental electricity connection in their name at the
place of posting.
The Commission has taken note of the submissions of the stakeholders and the Petitioner.
The Commission would like to clarify that in the previous Tariff Orders the Commission had not
been allowing the impact of concessional supply to departmental consumers including pensioners
of UPCL, UJVN Ltd. and PTCUL and has been considering revenue corresponding to the ABR of
domestic consumers. The Commission further to streamline the accounting of departmental
employee consumers directs the Petitioner to bill all departmental employees consumers on the
basis of rates approved for the RTS-1 Domestic Category from April 01, 2018.The Petitioner shall

include the consumption and revenue details of these consumers at the Domestic Tariff Rate in
the monthly CS-3 and CS-4 statements. As regards the concession provided to these consumers,
the Petitioner is directed to show the same separately as expenses in its accounts.
2.21 Tariff for Cane Crushers
Shri Vijay Singh Verma of Kisan Club requested the Commission to direct UPCL to provide
the details of the category under which cane crusher consumers are placed.
The Petitioner submitted that cane crushers are covered under Rate Schedule RTS-4, if they
fulfill the conditions specified in the applicability clause of this Rate Schedule.
The cane crushers are covered under Rate Schedule RTS-4 as per the terms and conditions
provided in the Rate Schedule.
2.22 Metering and Billing
M/s BST Textile Mills suggested to allow atleast 15 days’ time for online payments after bill
generation. He further submitted that UPCL is not providing net bills after adjusting open access
refunds.
Shri Shiv Narayan Baluni of Nehru Colony Residents Welfare Society requested the
Petitioner to provide electricity bills on monthly basis instead of 2 months for domestic consumers
as this leads to higher tariff slabs and taxes. He further added that inefficiency of UPCL should not
be passed on to the Consumers.
M/s Shiv Shakti Electricals submitted that the domestic supply is being utilised for the non-
domestic purposes. He further submitted that UPCL should check the IDF/NA meters which are
not present at site but their billing is still continued. He also submitted that replacement of defective
meter should be done within 7 days. Further, UPCL should take action on government and non-

government organizations for default in payment within one or two months, instead of waiting for
long. He further submitted that strict action is not being taken against consumers, who do not pay
their dues regularly.
M/s Shiv Shakti Electricals submitted that cables are not provided by UPCL for new meter
connections. In this regard, he requested the Commission to direct the Petitioner to provide list of
consumers to whom cables are provided by UPCL. He further suggested that UPCL should increase
collection centres with cash counters open till 4 PM for collecting electricity bills and should provide
security guard at cash counter and premises of every office well equipped with CCTV cameras. He
further submitted that the Petitioner does not properly maintain its electric poles.
Shri Vijay Singh Verma of Kisan Club requested the Petitioner to provide the clarification
regarding levy of any prepaid meter cost in case of replacement of meter to prepaid meter, even
though the security deposit fee for electricity connection is already paid to UPCL. He further
suggested that the seal used in meters should be made of reserve metal.
Shri Rajesh Singh Makkad and other stakeholders submitted that bills should be presented
to consumer after taking proper reading. Further, UPCL should simplify the procedure for transfer
of connections.
Shri G.D. Madhok requested the Commission to direct UPCL to provide safety measures in
order to avoid accidents from short circuits. Also, UPCL should take preventive measures like
cutting of trees which are nearby HT and LT lines.
Shri Vinay Kumar Saini submitted that due to higher monthly bills for the electricity
connections to tube-well and over-head tanks by UPCL, the consumers are not able to pay their
bills which leads to disconnection of their supply by UPCL. He further submitted that rural
consumers are not even benefitted from various Schemes of GoI and have to drink contaminated
water. He further requested the Commission that same tariff should be implemented on the
tubewell / over-head connections under National Rural Drinking Water Programme as applicable
to the Private Tube wells/ Pumpsets.
Shri Ashok Goswami of Shetra Mai Jeevani Ram Sukhdevi Ram Trust submitted that
connection no. 374 of his Ashram caters to students, old age persons and females and the same has

remained disconnected for the past 7 years despite paying dues. He further requested the Petitioner
to install meters outside the premises of Ashram for connection nos. 375 and 376 of his Ashram.
Shri Zail singh Rana,Chairman, Village Danpur and Shri Joga singh Mehta submitted that
overhead lines and poles are not firmly erected by UPCL in their village and this may result in
accidents.
As regards additional time for bill payment, the Petitioner submitted that 15 days grace
period is being allowed after due date and no delayed payment surcharge is payable if the bill is
paid upto the last date of grace period.
As regards tariff for drinking water connections, the Petitioner submitted that presently
connections released to Swajal Scheme are billed under Rate Schedule RTS – 6 (Public Water
Works). The tariff of this category is determined very near to the average cost of supply whereas the
tariff of PTW category is determined at about 37% of cost of supply. In case Swajal Scheme are
covered under Rate Schedule RTS – 4 (PTW), then this category will be subsidized which is against
the provisions of the Electricity Act, 2003.
As regards the penalty for delay in payments, the Petitioner submitted that action is being
taken against the consumers who are not paying their electricity dues in time. The connections of
defaulters are being disconnected and action is being taken against them as per the provisions of the
Uttarakhand (U.P. Government Electricity Undertakings (Dues Recovery) Act, 1958) Adaptation
and Modification Order, 2002.
Further, with regards to misuse of domestic connections, the Petitioner submitted that
vigilance raids are being conducted by field units as well as vigilance cell and action is taken against
such consumers.
As regards maintenance of meters, the Petitioner further submitted that UPCL is taking
suitable action against such complaints received from the consumers. Such connections are being
identified and fictitious arrears are being written off after preparation of final account of the
consumer. The release of new connections is being done as per the provisions of the Regulations.
As regards collection centres, the Petitioner submitted that UPCL is making efforts to
increase the number of collection centres and has also made arrangements for online payments for
consumers. The Petitioner has also made arrangement with M/s CSC to accept the payment of
electricity bills at their counters located at various locations of the State. Further, officers at various
levels have been authorized to sanction the payment in instalments.
With regards to collection of dues from government organizations, the Petitioner submitted
that in such cases arrears are regularly being recovered from government organisations. In this
regard, the Petitioner further submitted that it has recovered Rs. 731.03 Crore and Rs. 648.26 Crore
in FY 2015-16 and FY 2016-17, respectively from such government organisations. Also, prepaid
metering has been made mandatory for new temporary/Government connections upto 25 kW.
Further, the Petitioner has considered the suggestion of billing to domestic consumers on
monthly basis.
With regard to the contention raised by Ashram, the Petitioner submitted that Ashram
should contact the Executive Engineer, Electricity Distribution Division, Rishikesh for redressal of
the specified grievance.
The Commission has taken note of various suggestions received from the stakeholders
regarding improvement in metering and billing and the Commission directs UPCL to consider the
suggestions given by the stakeholders to improve its metering and billing system. Further, with
regard to the suggestion to provide electricity bills on monthly basis instead of 2 months for
domestic consumers, UPCL is directed to explore this option atleast in urban areas which will not
only improve its financial position but also will aid in proper identifying cases of
NA/NR/IDF/ADF etc. and will provide relief to the consumers also and submit its report in the
matter within 3 months of the date of the Order.
With regard to the comment seeking agricultural tariff to tubewells/over-head connections

under National Rural Drinking Water Programme, the Commission is of the view that agricultural
tariff (RTS-4 and RTS-4A) is for irrigation purposes and not for drinking water which is covered
under RTS-6 of the existing Rate Schedule. It will also not be logical to compare two different
categories where purpose of use of electricity is entirely different. It will also be difficult for the
Commision to design the tariff so as to address the individual needs of each and every consumer.
Tariff is designed based on the nature and purpose for which the supply of electricity is required.

2.23 Temporary Connections
2.23.1.1 Stakeholder’s Comment
Shri Ashok Goswami of Shetra Mai Jeevani Ram Sukhdevi Ram Trust suggested that UPCL
should impose a penalty of Rs. 10,000/- for not taking temporary connections for functions like
marriage ceremony etc.
M/s Shiv Shakti Electricals submitted that the temporary connections issued for functions
like marriages, ceremonies and other similar purposes are not issued properly and are sometimes
irregular connections. He further suggested that that there should be proper reading on monthly
basis for Temporary connections.
With regard to misuse of domestic connections, the Petitioner submitted that vigilance raids
are being conducted by field units as well as vigilance cell and action is taken against such
consumers.
The Commission directs the Petitioner to issue instructions to its field/ distribution
division officers to issue the proper temporary connections with prepaid meters for functions
like marriages, ceremonies and other similar purposes and should not provide any illegal
connection.
2.24 KCC Data
Shri Pankaj Gupta of Industries Association of Uttarakhand submitted that although UPCL
has done good job in compiling data in KCC cell, enough benefit is not being derived from scrutiny
of this data. He suggested that the Commission may set up one cell either in its office or in UPCL
for scrutiny of this data. This cell should be independent and should not be reporting to UPCL. The
formation of this cell would help in proper diagnostics of UPCL at division level.

The Petitioner submitted that it has covered all the industrial consumers having load above
5 kW and non-domestic consumers having load above 10 kW under KCC billing. The MRI report
and billing of the HT consumers are being checked at Corporate Office on regular basis. Corrective
actions are being taken on the irregularities found in the checking of the metering system and
billing of these consumers.
As regards the suggestion for scrutiny of KCC data, the Commission directs UPCL to
constitute a cell in its commercial wing for analysis and monitoring of KCC data including low load
factor cases, meter tamper cases etc. The Commission directs UPCL to submit the report on analysis
and monitoring of KCC data on monthly basis by 15th of every month.
2.25 Quality of Power
M/s. BST Textile Mills Pvt. Ltd. and Shri Mahesh Sharma of Uttarakhand Industrial Welfare
Association submitted that night shift power breakdowns should be attended in night itself in
minimum possible time.
Shri Pankaj Gupta of Industries Association of Uttarakhand submitted that the issues like
voltage variations amongst different phases, low voltage, high voltage, frequent breakdowns etc.
have become a common practice. The Commission should give clear directions to UPCL for
improvement in quality of supply.
Shri Zail Singh Rana, Chairman Danpur village submitted that there is no power supply in
Vacham village, but only poles and sub-station are installed. Also, he submitted that officers of
UPCL have denied giving receipts of the payment made towards electricity bills in other villages of
District Bageshwar.
Shri Pratap Singh Garia submitted that many electronic equipment gets damaged because of
faults at high voltage due to negligence of UPCL.

The Petitioner submitted that efforts are regularly made by UPCL for improvement in
quality of power. The demand of electricity has increased to about four times from the date of
creation of the State and UPCL is meeting the demand of electricity to the satisfaction of the
consumers. In the whole State, average supply of electricity in a day is between 22-24 hours.
The Commission has taken note of concerns raised by the stakeholders and directs UPCL to
take adequate steps to improve the quality of supply. In this regard, the Commission would like to
clarify that UPCL’s complaint handling procedures have been approved by the Commission and are
available on the website of the UPCL/Commission which, interalia, provides computerised logging
of complaints followed by status feedback to the complainant in his mobile/phone. If the
complaints are not resolved by UPCL internally, the consumers can also lodge their complaints with
the “Consumer Grievance Redressal Forum” functional in the respective Garhwal and Kumaon
Zones of Uttarakhand.
2.26 Railway Traction
Shri Sudhanshu Krishna Dubey, Chief Electrical Distribution Engineer of Northern Railways
submitted that the tariff increase proposed by UPCL is the highest among all the consumers of
UPCL, even more than HT Consumers. He further submitted that Railways have been making
timely payment, drawing uninterrupted uniform supply day and night, contributing negligible
technical and commercial losses, etc. and hence, the tariff for Railways should not be increased and
should be commensurate with the average cost of supply. He further submitted that the overall
revenue gap estimated by UPCL for FY 2018-19 is Rs. 820.29 Crore and, accordingly, average tariff
hike of 13.44% has been proposed to cover this revenue gap. In this regard, he suggested that this
revenue gap should be supported by Government subsidy, not by FCA (Fuel Consumption) and
tariff of railways should not be increased.

He also submitted that UPCL should work out category wise cost of supply and then link
the tariff with that cost of supply and should gradually reduce the cross subsidy as per provision of
National Tariff Policy.
He further submitted that in Rajasthan, Railways is exempted from payment of ACD/

Security Deposit. In West Bengal, there is no provision for ACD/Security Deposit. He further
submitted that in Uttar Pradesh, UPPCL has agreed for payment of ACD/Consumption Security
through Bank Guarantee above Rs. 30 Lakh. Further, in Maharashtra, Railways is depositing
Security Deposit in the shape of letter of guarantee from RBI instead of cash to DISCOM.
Accordingly, he suggested that Railways may be exempted from payment of ACD/security deposit
and if not then Railways may be allowed the payment in form of Letter of assurance from RBI.
He also submitted that in case of incoming supply failures, Railway have to extend the feed
of Roorkee/TSS being fed by UPCL in the feeding zone of failed TSS being fed by HVPN/UPPCL
and have to pay load violation charges for exceeding the sanctioned contract demand for the
circumstances, whenever there is supply failure from HVPN/UPPCL till such time the supply
failure persists. Further, he submitted that railways take supply from UPCL for traction purpose at
220 kV at Roorkee/TSS. Railways have to pay load violation charges on exceeding the sanctioned
contracted demand.
As regards metering, he submitted that as per Regulation 7(b)-I of the Central Electricity
Authority (Installation and Operation of Meters) Regulation 2006, the consumer meter shall be
installed by the licensee either at consumer premises or outside the consumer premises. In case of
railway traction consumer premises is Railway traction sub-station. Therefore, meters should be
installed on the railway traction sub-station instead of grid sub-station of UPCL. He also requested
to consider the provision of simultaneous maximum demand of all adjacent metering points and
also of making single agreement for all adjacent supply points for future Railway Traction
substations in Uttarakhand.
He suggested that for Demand Charges, the Billing Demand should be 65% of the contract
demand or recorded demand during the month, whichever is higher for traction load as in Uttar
Pradesh.
He further suggested that some incentives on timely payment, online payment etc. may be
considered for Railways. Also, for leading power factor load the energy charges are taken on kW

and not on kVA. He also requested rebate for availing supply at Voltage higher/lower that base
voltage should be given on sale of Power instead of Energy Charges on Railway Traction Category.
Further, Northern railways for domestic consumers suggested that minimum time should be
fixed for Release/ Enhancement of the Connections. He further suggested that no meter testing
charge should be levied on New Connections or the Enhancement of the Connections. The
proposed Tariff increase may be kept minimum for Railways, Domestic and Non-Domestic
category of consumers.
The Petitioner submitted that UPCL is a commercial organization and is required to meet its
Annual Revenue Requirement out of the revenue realized from the consumers through electricity
tariffs. To recover the revenue deficit of Rs. 820.29 Crore for FY 2018-19, the Petitioner has proposed
16.77% increase in the Tariff for Railway Traction.
The Petitioner submitted that presently, voltage wise / category wise losses are not available
and category wise tariff has been calculated on the basis of average cost of supply and permissible
level of cross subsidy, which is as per Regulation 91 of the UERC Tariff Regulations, 2015. Further
the Petitioner has submitted that UPCL is in process to calculate the voltage wise cost of supply as
per directive of the Commission.
As regards the Cross-subsidy, the Petitioner, in this Tariff Petition has proposed the tariffs so
that the cross-subsidy for subsidized categories can be phased out gradually to reduce the burden
on subsidizing categories such as railways in the long run.
As regards the billing demand to be kept at 65%, the Petitioner submitted that about 80% of
UPCL’s cost is fixed in nature while recovery from fixed charges is about 15% and, therefore,
reduction in billable demand from 80% to 65% would further reduce the recovery of fixed charges
which should be avoided in a mandate of two part tariff. Further, in case demand charges are
reduced, the energy charges will have to be increased in order to have the composite tariff
equivalent to the cost of supply plus required level of cross subsidy.
Regarding installation of meters, the Petitioner submitted that Regulation 2(2)(a) of the
Central Electricity Authority (Installation and Operation of Meters) Amendment Regulations, 2010
provides that the consumer meter shall be installed by the distribution licensee either at the

consumer premises or outside the consumer premises. UPCL has installed the consumer meter at
Grid substation, i.e. outside the consumer premises. This is as per the provisions of Law.
The Petitioner further submitted that as per the existing Rate Schedule, in case of consumers
where electronic meters with MDI have been installed, if the maximum demand recorded in any
month exceeds the contracted load/demand, such excess load/demand shall be levied twice the
normal rate of fixed/demand charge as applicable. Further, the load violation charges are based on
the fact that UPCL is also required to pay UI Charges for drawing power more than scheduled
power. These UI Charges are normally higher than the average cost of power.
As regards incentives of timely payment, the Petitioner submitted that it is required to

recover its cost of supply through tariff, i.e. energy charges and demand charges. In case, timely
payment rebate is given, there will be increase in tariff.
Further, the Petitioner submitted that since UPCL has separate contract agreements for
supply for traction purpose at 220 kV and 132 kV at Roorkee and Jwalaur/TSS, metering of
simultaneous maximum demand is not feasible. Further, since peak load violation affects the
UPCL’s ability to supply to nearby area, therefore, a single agreement for all adjacent supply points
is also not feasible.
On the issue of Security deposits, the Petitioner submitted that the Security deposit received
from the consumers is to securitize the credit sales made by the DISCOM. In case a consumer
defaults in making the payment of his electricity bills, the recovery of such electricity dues may be
made by adjusting the security deposit of the consumer. As per Section 47(4) of the Electricity Act,
2003, the Distribution Licensee is required to pay interest on the security deposit. Interest on
security deposit cannot be paid on the money held with UPCL as Bank Guarantee / Letter of Credit,
hence, the security deposits should only be in the form of cash / bank draft.
The Petitioner further submitted that the tariff is determined at a certain voltage level and
the consumers connected at higher voltage level contribute less distribution losses and, therefore,
are entitled for voltage rebate. As there is no relation of distribution losses with contracted load and
demand charges, voltage rebate should not be admissible on demand charges and it should be
admissible only on energy charges. The apparent power is the power which is supplied from the
source whereas the real power is consumed by the Load. In both the cases of leading power factor

and lagging power factor less than 1, the real power is less than the apparent power and the
apparent power should be charged from the consumers depending upon the nature and use of load.
The Petitioner with regard to general electric supply submitted that as per the existing Tariff
Order no meter testing charges are payable for new connections. Further, the Petitioner submitted
that the procedure and conditions for enhancement of load is specified in the UERC (Release of
New HT & EHT Connections, Enhancement and Reduction of Loads) Regulations, 2008.
The reply of the Petitioner on cross-subsidy, security deposit etc. is in accordance with the
provisions of the Act, CEA Regulations, and Orders of the Commission. However, with respect to
tariff hike as discussed earlier, based on the approved ARR for FY 2018-19 including impact of
truing up for FY 2016-17, the Commission has marginally increased the tariff with respect to tariff
for FY 2017-18 approved vide Tariff Order dated 29.03.2017 to meet the projected revenue gap as
discussed in detail in Chapter 5 of the Order. However, as the consumers are currently paying
Additional Energy Charge (AEC) which is effective till 31st March, 2018, there is no tariff increase if
the tariff approved in this Order is compared with the existing tariff approved by the Commission
in its Order dated 29 March, 2017 plus AEC being paid by the consumers. Further, continuing with
the approach adopted in previous years, the Commission has attempted to reduce the cross-subsidy
while designing the tariffs for various categories as elaborated in Chapter 5 of the Order.
As regards the reduction in billing demand for levying the demand charges, the
Commission find the current provision of billing demand as 80% of the contract demand or
recorded demand during the month, whichever is higher, as appropriate and does not find any
reason to modify the same.
2.27 Open Access
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. and Shri Munish Talwar
of Asahi India Glass Ltd. submitted that in spite of demand exceeding supply of power in
Uttarakhand, the open access power purchase is not supported in the State. Open Access consumers
are heavily charged with 15% distribution losses and 15% additional surcharge for continuous

power. The overall charges applicable for open access make it unviable to purchase power under
open access.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. also submitted that there
is no system for adjustments of open access units consumed at the time of billing. Consumers have
to follow up for rectification of the same. Also, there are no clear cut guidelines to the staff for
adjustment of the same which creates the confusion. He further submitted that compensation is
allowed by UERC in case of open access is not availed due to breakdowns, however, the consumers
do not get compensation inspite of repetitive reminders on account of UPCL.
Shri Shakeel A Siddiqui of Kashi Vishwanath Textile Mill Pvt. Ltd. further submitted that
SLDC normally gives NOC on last date to procure open access power. In this regard, there needs to
be a schedule by which NOC is to be given eg. latest by 10th of every month. He further submitted
that load survey reports should be available to all HT consumers by 5th of next month so that they
are able to monitor their consumption of electricity slab wise. He further requested to reduce the
cross subsidy surcharge by 25%, transmission losses by 25% and distribution losses by 75% since
line losses in HT consumers is hardly 1-2%.
Shri R. K Singh of Tata Motors Ltd. and Dr. Vijay Dhasmana, Chairman, CII Uttarakhand
State council has submitted that Open access consumers have to obtain No Objection Certificate
(NOC) from SLDC every month. In this regard, they requested the Commission to review it and
allow consumer to obtain NoC on quarterly basis. This will reduce processing time of NOC issuance
and encourage consumers to avail power from open market.
M/s. BST Textile Mills Pvt. Ltd. submitted that wheeling charges on power purchased from
open access should be removed as it is already paying the demand charges. It also submitted that
the adjustment of power purchased through open access is done manually by UPCL in the monthly
bill.
Shri R.S. Yadav of India Glycols Ltd., Ms. Shruti Bhatia of India Energy Exchange Limited,
Shri Jatinder Kumar of Air Liquide India and Shri Pankaj Singh Bora of Galwalia Ispat Udyog
Private Limited submitted that UPCL has proposed additional surcharge of Rs. 1.42/kVAh on Open
Access in order to increase its profitability and discourage Open Access, and, therefore, the same is
unjustified. They further submitted that UPCL has not given any justification for the
stranded/unutilized power through Open Access. They further suggested that as only few States

impose additional surcharge and most of the States do not have provision for the same, therefore,
additional surcharge should not be imposed.
Shri Pramod Singh Tomar of PSR Innovations LLP has submitted that the Additional Energy
charge is levied only to recover the revenue loss of UPCL for FY 2017-18. He further requested the
Commission not to charge any further AEC.
Shri Jatinder Kumar of Air Liquide India submitted that levying additional surcharge by
UPCL is unjustified. He further suggested that additional surcharge may be considered only when
UPCL have demonstrated surplus situation for two years continuously.
The Petitioner in its Tariff Petition for FY 2018-19 has proposed a low tariff hike for
industrial consumers to gradually phase out the cross subsidy. Further, the Petitioner has
considered intra-State transmission losses as that approved by the Commission for the respective
years. In case of inter-state transmission losses, the Petitioner has compiled station-wise actual
losses in FY 2016-17 and considered the same for its projections.
The Petitioner submitted that Wheeling Charges is the sum of all expenses of UPCL other
than power purchase expenses and Transmission charges. As the demand charges has been kept
less than the required wheeling charges, the differential of required wheeling charges and demand
charges is also payable as wheeling charges by the embedded open access consumers.
The Petitioner submitted that the current open access consumers with UPCL are of
embedded nature, who buys power from UPCL as well as through open access as per their financial
suitability. However, in case these open access consumers choose to buy power from UPCL in place
of open access, then the Petitioner is required to supply power to them as per their contracted
capacity with it. Accordingly, the Petitioner is required to have an arrangement of power sufficient
to meet the requirement of these open access Consumers including the quantum which they were
buying earlier through open access. In case any Consumer goes for open access, then the Power
Purchase commitments of the Petitioner becomes stranded and, therefore, the open access
consumers are required to bear fixed component of power purchase cost of the Petitioner. The
Petitioner further submitted that absence of suitable additional surcharge levied to the open access
consumer would result in undue burdening on the other consumers of the licensee. Further, cross

subsidy surcharge has been proposed equivalent to the difference of tariff of this category and
average tariff.
The Petitioner submitted that presently open access energy is being adjusted manually by
the distribution divisions in the next month of the transactions. However, the Petitioner is in
process to update its billing software to adjust the Open Access Energy in the consumer bill and this
shall be implemented in due course of time. The Petitioner further submitted that all the field
officers have been instructed to comply with the provisions of the UERC Regulations, 2015,
however, in case of dispute on any subject, they are required to take up the case with appropriate
Forum/ Court. The Petitioner further submitted that load survey data is a bulky data and providing
such data on web platform will heavily load the UPCL portal. Therefore, load survey report may be
provided to the Consumers on payment of charges as specified in the Tariff Order.
The Petitioner submitted that presently, voltage wise/category wise losses are not available
and distribution loss for all the consumers including open access consumers is considered at the
same level. The Petitioner further submitted that UPCL is in process to calculate the voltage wise
cost of supply.
The Petitioner also submitted that in accordance with Regulation 29(2) of the UERC (Terms
and Conditions of Intra-State Open Access) Regulations, 2015, issued on 13.01.2015, system
distribution losses shall be as determined by the Commission in the Tariff Order for the open access
customers. The Petitioner further submitted that the Commission in its Tariff Order for FY 2016-17
approved the pooled average system distribution losses of 15% for FY 2016-17 in accordance with
the UERC Tariff Regulations, 2015. The Petitioner also submitted that in accordance with Section
42(2) of the Electricity Act, 2003, open access may be allowed only on payment of existing level of
cross subsidy by the Consumer.
Some of the stakeholders have raised the issues related to Open Access such as renewal of
open access, etc, which are governed by Uttarakhand Electricity Regulatory Commission (Terms
and Conditions of Intra State Open Access) Regulations, 2015. The principles for calculating
Transmission/Wheeling charges, cross-subsidy surcharges & losses have already been specified in
the Regulations and are therefore worked out on the principle specified. On the issues raised that no
wheeling charge should be levied on open access consumers as demand charges are already being
paid by them, the Commission clarifies that wheeling charges recovered by embedded open access
consumers is net off demand charges applicable to such consumers in accordance with the
provisions of the Regulations.
2.28 Collection Efficiency
Shri R.K. Singh of Tata Motors Ltd. and Dr. Vijay Dhasmana, Chairman, CII Uttarakhand
State council requested the Commission to direct UPCL for keeping its target of collection efficiency
to 100%.
The Petitioner submitted that the collection efficiency of 103.54% for FY 2016-17 has been
computed based on the recovery of past arrears along with the collection made in the FY 2016-17.
The Petitioner further submitted that it has retained the trajectory laid down by the Commission for
proposing collection efficiency in FY 2017-18 and FY 2018-19. Further, the Petitioner is making
continuous efforts to increase its collection efficiency.
The Commission directs UPCL to make efforts to achieve the collection efficiency targets
approved by the Commission.
2.29 Promotion of Renewable Energy
Shri R.K. Singh of Tata Motors Ltd. submitted that the solar power costs have been reduced
to Rs. 2.97/unit, therefore, he suggested that the Petitioner should be encouraged for power
purchase from solar power generating infrastructures to reduce its power purchase cost.
Shri Amit Joshi submitted that the Petitioner has considered power purchase cost from solar
plants at the rate more than Rs 5.00 /kWh, which is not a good practice in current scenario. He
further suggested that the Petitioner should be directed to consider solar purchase from alternative
cheaper options otherwise it would be an extra burden on the consumer of the state.

Regarding renewable energy power for FY 2018-19, Shri Amit Joshi further submitted that
the Petitioner in Table 84 of the Petition has determined 164.79 MUs as unmet target of solar power
to be met with solar REC’s @ 3500/MWh. In this regard, he further submitted that in accordance
with the CERC Order current Solar REC price is 1000/MWh and the same should be considered,
even though the matter is sub-judice in the Hon’ble Supreme court.
As regards the higher power purchase cost from solar plant, the Petitioner submitted that
the tariff has been considered in accordance with the tariff bid by the developers for already
commissioned solar power projects. For upcoming solar projects, tariff has been considered in
accordance with the generic tariff determined by the Commission in Order dated 03.08.2017 for grid
interactive rooftop and small solar PV plants.
The Petitioner further submitted that since the matter of Solar REC price of Rs. 1000/MWh is
sub-judice in the Hon’ble Supreme Court, it has considered the floor price @ Rs. 3500/MWh.
The Petitioner further submitted that it is making consistent efforts to reduce the power
purchase cost from all sources and is well aware of the declining costs of solar power. The Petitioner
has been in discussion with NTPC (Bundled) and private developers to procure solar power at
cheaper rates. However, the generic tariff for private IPPs and rooftops is still in the range of Rs.
7.8/unit to Rs. 5.2/unit due to smaller capacities and higher financing costs. Therefore, the
Petitioner has been cautiously expanding the energy portfolio to ensure that the average power
purchase cost remains at market competitive rates.
UPCL is required to buy energy from renewable energy sources to meet the RPO Target. The
State Nodal Agency UREDA is actively pursuing development of Solar energy in the State under
MNRE/State Government policies in this regard.

2.30 Miscellaneous Comments
2.30.1 Terms and Conditions for Seasonal Industries (RTS-7)
there is a condition in RTS-7 for seasonal industries that if during the off-season period, the actual
demand of a consumer exceeds 30% of the contracted demand, the consumer will be denied benefit
of reduced contracted demand for that season and an additional surcharge of 10% of demand
charge is levied for the entire off-season months on the billable demand. He further submitted that
this condition is too harsh in penalizing the industry and requested for relief to casual unintentional
increase in demand beyond 30% in any one month of the season.
Dr. Vijay Dhasmana, Chairman, CII Uttarakhand State council submitted that tourism units
should be treated as seasonal industry and should be provided with some benefits during the off-
season.
The Petitioner submitted that with a view to provide the benefit of the seasonal industry in
right manner, the terms & conditions specified by the Commission may be complied with
completely.
As regards considering tourism as seasonal industry, the Petitioner submitted that

industries are those establishments where any production/ processing activity is performed. No
production/processing activity is performed in tourism and, therefore, it should not be treated as
industry / seasonal industry.
As regards addition of new conditions proposed by the Petitioner for seasonal industries,
the Commission is of the view that the existing provisions of Rate Schedule regarding Seasonal
Industries are amply clear and no change is warranted in the same.

2.31 Views of State Advisory Committee:
During the Advisory Committee meeting held on March 5, 2018, the Members made the
following suggestions on the APR Petitions for FY 2017-18.
a) UPCL has raised the issues on distribution loss reduction trajectory approved by the
Commission and has claimed higher distribution loss. This aspect needs to be
examined by the Commission.
b) The Commission should check whether the revenue from sale of power claimed by
UPCL is on actual basis or based on the bills raised by UPCL as the bills raised by
UPCL also includes the sales and revenue based on provisional billing which is
different from actual sales and revenue.
c) A Consultation Forum should be made including officers of Utilities, Regulatory

Commission, representative of industries and representative of other stakeholders to
discuss the issues related to Uttarakhand power sector.
d) Availability and quality of power from UPCL has improved substantially. UPCL
should attend night shift breakdown in night itself.
e) MCG should be abolished for Micro small industries in the current Tariff fixation.
f) UPCL should convert their Sub-station into profit cost centres and any Sub-station
found to be losing money should be subjected to penalties. UPCL should convert at
least one Sub-station into profit centre on sample basis at the earliest.
g) There is a need for improvement of existing system of UPCL. The Commission

should allow separate funds to UPCL for the improvement of the system and further
allow them to charge the same in the Tariff.
h) Consumers are being charged extra towards the payments made through online
transfers. The Commission should resolve the issues related to online payment of
bills.
i) Morning Peak hours should be shifted from 6 am to 8 am instead of 6 am to 9:30 am.

j) UPCL should clarify as to why the sales of Non-Domestic is not increasing at

envisaged growth rate despite new commercial loads getting added into the system
needs to be examined.
k) UPCL’s proposal with respect to violation of contract demand in excess of 110% for
consecutive 3 months is the issue related to Supply Code and not the tariff. Hence,
the Commission should not approve the UPCL proposal as part of Tariff.
l) UPCL during truing up for FY 2016-17 has claimed higher power purchase cost with
respect to approved figures and on other side actual revenue from sale of power has
been reduced with respect to approved revenue. This aspect needs to be critically
examined.
m) The lower growth in Non-Domestic and Industrial sales needs to be critically

examined considering the GDP growth rate.
n) There is a huge difference between the tariff hike claimed by UPCL and the CPI
increase (Consumer Price Index). This huge mismatch between the two figures needs
greater balance.
o) The industry and tourism will get affected with substantial increase in tariffs and,
hence, the Commission may approve the reasonable increase in tariff.
p) The Commission should categorise Hotels as part of Tourism Industry and industrial
tariff shall be applicable for hotels.
q) Tourism industry is a seasonal industry and it should not be penalized by levy of

MCG charges during off peak season.
The Petitioner submitted the following replies:
a) UPCL submitted that they have proposed an additional surcharge of Rs. 1.42 per
kWh based on the average fixed cost of the total power purchase and it will examine
the additional surcharge approved in other States and, accordingly, modify its
proposal.

b) UPCL submitted that it had proposed a disconnection of any industrial consumer

who violates the contract demand for more than 110% for consecutive 3 months.
c) UPCL requested the Commission to revise the distribution loss targets by

considering the base equivalent to UDAY scheme of GoI.
2.31.1.2 Observations of Principal Secretary, Energy, Government of Uttarakhand:
a) She adviced UPCL not to charge anything extra to the consumers who make the
online payment of bills through electronic transfer. As per GoI directive, an incentive
needs to be provided to the consumers who are making online payment of bills
through electronic transfer.
b) She also suggested that the Commission may modify the slab of Lifeline consumers
(BPL consumers) from the existing level of 30 units/month to 100 units/month.
The Commission suggested the utilities to make appropriate arrangements for supply of
power to consumers on long term basis.
The Commission directs UPCL to address the concerns raised by the Members of the
Advisory Committee and submit an Action Taken Report within one month of the date of Order.
Regarding payment of bills using payment gateway, the Commission is of the view that it
will assist UPCL in getting payments credited to its accounts quickly and it also saves it towards
holding and carrying cost of cash. Hence, UPCL is directed not to charge any service charges
from the consumers on payment of bills using its payment gateway & submit the compliance on
the same to the Commission within one month of the date of the Order.
The Commission is of the view that the overall tariff increase is a function of projected
Annual Revenue Requirement for the ensuing year (including impact of truing up of expenses and
revenue for previous year) and projected revenue at existing tariffs. The Commission has carried
out the detailed scrutiny of APR for FY 2017-18, Revised ARR for FY 2018-19 and truing up for FY
2016-17 in accordance with the provisions of the relevant Regulations as discussed in the
subsequent Chapters of the Order. Based on the ARR for FY 2018-19 including impact of truing up
for FY 2016-17, the Commission has marginally increased the tariff with respect to tariff for FY 2017-

18 approved vide Tariff Order dated 29.03.2017 to meet the projected revenue gap as discussed in
detail in Chapter 5 of the Order. However, as the consumers are currently paying Additional
Energy Charge (AEC) which is effective till 31st March, 2018, there is no tariff increase if the tariff
approved in this Order is compared with the existing tariff approved by the Commission in its
Order dated 29 March, 2017 plus AEC being paid by the consumers.

3. Petitioners’s Submissions, Commission’s Analysis, Scrutiny
and Conclusion on Truing-up for FY 2016-17
3.1 Impact of Change in Financing from FY 2012-13 to FY 2015-16
The Petitioner in its Review Petition dated May 09, 2017 filed against the Tariff Order for FY
2017-18 dated March 29, 2017, had brought to the notice of the Commission that the assets created
under REC funded schemes involved an equity portion of 30% to be invested by the Petitioner. In
this regard, the Petitioner also submitted that REC grants loan to the Petitioner on the condition that
the Petitioner Company shall invest 30% in the project. To substantiate the same, the Petitioner
submitted a copy of the REC letter dated 28.12.2015. The Petitioner further stated that as per the
letter, REC has been sanctioning the loan against the project with a provision of 30% equity to be
invested by the Petitioner.
The Commission while disposing the Review Petition stated as follows:
“Further, the claims made by UPCL now in this Petition suggests that UPCL during the truing up
proceedings had been camouflaging the entire equity utilised in creation of assets in the internal
resources to derive maximum returns in the form of RoE. Besides, considering the equity claimed by
UPCL in this Petition would change the entire financing approved by the Commission and also the
interest on loans and return on equity thereon. Thus, it appears that there is no error apparent on the
face of the record and therefore, the issue does not qualify for review, hence the same is rejected.
However, the Petitioner is directed to reconcile the figures submitted in the previous tariff
proceedings with that claimed in the review Petition and submit the same in the next tariff
proceedings. The Commission will take a view on the same thereupon. However, since the
same is due to laxity of UPCL, the Commission holds that no carrying cost on the same would be
admissible to UPCL.”
(Emphasis added)
The Petitioner in compliance to the above, in the current tariff proceedings has submitted the
revised means of finance for the asset additions from FY 2012-13 onwards which is as shown below:

Table 3.1: Revised Means of Finance of additional capitalization from FY 2012-13 to FY

2015-16 as claimed by the Petitioner (Rs. Crore)
FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16
Particulars Earlier Revised Earlier Revised Earlier Revised Earlier Revised
Approved Claim Approved Claim Approved Claim Approved Claim
RGGVY - - 7.78 7.78 9.62 9.62 - -
State/ District
10.90 10.90 1.89 1.89 - - - -
Plan
R-APDRP Part
- - 2.97 2.97 16.59 16.59 2.43 2.43
A
REC Loan 42.58 60.83 79.90 114.14 189.90 271.27 139.80 177.13
Deposit Works
119.70 119.70 28.98 28.98 181.80 181.84 105.20 105.22
/ Grants
Internal
57.32 39.07 63.49 29.25 95.30 13.90 37.30 -
resources
Total 230.50 230.50 185.01 185.01 493.22 493.22 284.78 284.78
On the basis of the above, the Petitioner has sought the impact on account of increase in RoE
and has submitted the computation as follows:
Table 3.2: Impact of change in funding of additional capitalisation from FY 2012-13 to FY

2015-16 as claimed by the Petitioner (Rs. Crore)
Opening Closing RoE RoE Differential RoE to
Particulars Addition
Equity Equity Claimed Allowed be allowed
FY 2012-13 191.03 29.97 221.00 26.74 26.74 -
FY 2013-14 221.00 43.02 264.02 35.36 33.32 2.04
FY 2014-15 264.02 85.55 349.57 42.24 36.36 5.88
FY 2015-16 349.57 53.14 402.71 55.93 40.94 14.99
Total 160.28 137.36 22.91
The Petitioner has claimed the above additional RoE along with the carrying cost to be
recovered in FY 2018-19.
The Commission has gone through the submissions of the Petitioner. The Commission had
carried out the truing up for FY 2013-14 in its Order dated April 11, 2015 for FY 2007-08 to FY 2012-
13 and the truing up for FY 2014-15 and for FY 2015-16 in its Order dated April 05, 2016 and March
29, 2017 respectively as per the means of finance submitted by the Petitioner from time to time. The
Petitioner, however, after two years since the final truing up of FY 2013-14 has raised this issue
through its Review Petition dated May 09, 2017. Though considerable time has lapsed, however,
since the claim is legitimate and has been appropriately substantiated by the Petitioner, the
Commission is of the considered view to revise the funding as per the submissions made by the
Petitioner. However, as also held by the Commission in the Review Order dated August 03, 2017,

3. Petitioner’s Submissions, Commission’s Analysis, Scrutiny and Conclusion on Truing-up for FY 2015-16
since the same is on account of laxity on the part of the Petitioner, no carrying cost is being allowed
on the impact of change in means of finance for previous years.
The Commission in order to compute the impact has reduced the corresponding amount
from the internal resources equivalent to equity infused for projects financed by REC and the same
has been considered as equity portion for REC Scheme. The revision in funding shall result in
reduction in normative loan and interest thereon and higher overall equity and RoE thereon vis-à-
vis that trued up earlier. Further, the change in funding will have no impact on the truing up of FY
2012-13 as the capitalization of assets added during the year is done on the last day of the financial
year by the Petitioner. Therefore, the impact of the same has been computed from FY 2013-14
onwards. The net impact of the revision in funding is as shown in the Table below:
Table 3.3: Impact of change in funding of additional capitalisation from FY 2012-13 to

FY 2015-16 approved by the Commission (Rs. Crore)
Particulars FY 2013-14 FY 2014-15 FY 2015-16 Total
Interest on Loan Approved Earlier 99.21 108.51 159.39 367.11
Interest on Loan Approved Now 91.63 107.76 151.89 351.28
Excess (A) 7.58 0.75 7.50 15.83
RoE Approved Earlier 33.32 36.36 40.94 110.62
RoE Approved Now 35.36 42.24 55.93 133.53
Shortfall (B) -2.04 -5.88 -14.99 -22.91
Net Excess/(Shortfall) (A-B) 5.54 -5.13 -7.49 -7.08
The Commission, therefore, allows an amount of Rs. 7.08 Crore to be recovered by the
Petitioner in FY 2018-19 without carrying cost.
3.2 Truing-up for FY 2016-17
Regulation 12(3) of the UERC (Terms and Conditions for Determination of Tariff)
Regulations, 2015 specifies as under:
“(3) The scope of the Annual Performance Review shall be a comparison of the actual performance of
the Applicant with the approved forecast of Aggregate Revenue Requirement and expected revenue
from tariff and charges and shall comprise of following:
a) A comparison of the audited performance of the applicant for the previous financial year with the
approved forecast for such previous financial year and truing up of expenses and revenue subject
to prudence check including pass through of impact of uncontrollable factors;

b) Categorisation of variations in performance with reference to approved forecast into factors within
the control of the applicant (controllable factors) and those caused by factors beyond the control of
the applicant (un-controllable factors).
c) Revision of estimates for the ensuing financial year, if required, based on audited financial results
for the previous financial year;
d) Computation of the sharing of gains and losses on account of controllable factors for the previous
year.”
The Petitioner submitted that the Commission vide its MYT Order dated April 05, 2016 had
approved the expenses and revenues of the Petitioner for FY 2016-17 based on the UERC Tariff
Regulations, 2015, the historical trends and the revised projections of the Petitioner.
The Commission has analysed the head-wise elements of ARR and revenue for FY 2016-17 in
the succeeding paragraphs. The head-wise details of variations in expenses and revenues are
enumerated below.
3.2.1 Sales
The Commission had approved the energy sales for FY 2016-17 in the Tariff Order dated
April 05, 2016 as 11187.75 MU. The Petitioner in the current Petition has submitted the actual sales
for FY 2016-17 as 10571.69 MU and further submitted the actual re-casted sales of 10571.98 MU.
The Commission continuing with its approach adopted in its Tariff Order for FY 2016-17
directed the Petitioner to submit the breakup of sales for all the consumer categories into three
parts, i.e. sales based on actual meter reading, unmetered sales and sales billed on
provisional/assessment basis for FY 2016-17 during the current proceedings. In reply to the
Commission’s direction, the Petitioner submitted the following:

Table 3.4: Break up of Sales submitted by the Petitioner for FY 2016-17 (MU)
Based on Actual Meter
Based on Assessment Unmetered Total
Reading
Consumers
Consumers
Consumers
S.
Number of
Number of
Number of
Number of
Load (KW)
Load (KW)
Load (KW)
Load (KW)
consumers
Connected
Connected
Connected
Connected
Sub-Category
No.
(MU)
(MU)
(MU)
(MU)
Sales
Sales
Sales
Sales
(i) BPL and Kutir Jyoti 335845 336281 183.95 17453 17476 9.56 353298 353757 193.51
(ii) Other Domestic Consumers 1400148 2158063 2122.97 72762 112149 110.32 13 13 0.00 1472923 2270225 2233.30
(iii) UPCL Employees and Pensioners 1507 7120 8.51 912 1612 1.97 2419 8732 10.48
(iv) UJVNL Employees and Pensioners 552 1753 3.16 349 415 0.71 901 2168 3.87
(v) PTCUL Employees and Pensioners 230 563 1.15 162 689 1.52 392 1252 2.67
(vi) Single Point Bulk Supply 104 25319 42.32 104 25319 42.32
1. Domestic 1738386 2529099 2362.06 91638.32 132340.71 124.08 13 13 0 1830037 2661453 2486.15
2. Non-domestic 208480 900850 1146.88 10834 22752 27.30 219314 923602 1174.18
3. PTW 28943 151203 333.05 1506 7867 17.31 46 186 0.13 30495 159256 350.49
4. LT Industry 9699 205549 294.31 398 4067 5.82 10097 209616 300.14
5. Public Lamps 1259 13271 45.45 52 552 1.91 14 180 1.05 1325 14003 48.40
6. Govt. Irrigation System 1593 57649 140.00 58 2091 5.08 1651 59740 145.08
7. Public Water Works 1404 78177 350.88 47 2418 7.16 1451 80595 358.04
8. HT Industry 1959 1565573 5508.03 1959 1565573 5508.03
9. Mixed Load 77 59843 178.11 77 59843 178.11
10. Railway Traction 2 11050 19.23n 2 11050 19.23
11. Other State Supply 6 985 3.84 6 985 3.84
Total 1991807 5573250 10381.84 104534 172087 188.67 73 379 1.17 2096414 5745716 10571.69
The Commission observed that the Petitioner in its above submission submitted the sales of
1.17 MU under the unmetered category. The Commission sought reply from the Petitioner for
unmetered sales being booked even after the directions of the Commission and the details of tariff
at which billing of such unmetered sales has been done. The Petitioner in its reply submitted that
the same was checked with the billing details under R-APDRP billing module and it was found that
no bill was generated during FY 2016-17 at unmetered tariff.
The Commission in its Tariff Order dated March 29, 2017 had analysed division wise
commercial statement for FY 2015-16 and observed that like previous years, the average billing rate
(ABR) in some divisions were even less than the energy charge approved for that category and had
directed the Petitioner as follows:
“The Commission re-iterates its direction and provides final opportunity to UPCL to rectify such errors
and, accordingly, directs UPCL to rectify such anomalies else the Commission would examine the
matter and if required necessary corrections to this extent would be made in the subsequent years.
Further, the Zonal Chiefs, the Circle Chiefs and the concerned Executive Engineers are hereby directed
to examine the data with reference to their Divisions for FY 2014-15 and for FY 2015-16 and submit
the justification to the Commission within 45 days of the date of Order on the above discrepancies
failing which action may be initiated against them individually by the Commission under Section 142
of the Electricity Act, 2003 and also against the Directors of the Petitioner Company.

The Commission further directs UPCL to submit the findings of the study being carried out on sales,
average load factor, average billing rate for FY 2015-16 within six months from the date of this Order
along with the detailed action plan to rectify such errors.”
The Petitioner in compliance to the above directions submitted that the matter was
discussed with the field officers by Director (Operation) and during discussion it was observed that
the discrepancies in the commercial data was mainly due to the reason that at the time of revision of
bills pertaining to prior period, amount is reduced from the assessment but the corresponding
consumption is not reduced from the billed units and in this connection necessary directions have
been issued. The Petitioner also submitted the report prepared by its consultants on the findings of
the study for FY 2015-16as follows.
Table 3.5: Findings of the Sales audit for FY 2015-16

Particulars As per Consultant’s Report As per Commercial Diary
Billing Efficiency 81.67% 81.99%
Collection Efficiency 106.60% 106.29%
AT&C Loss 12.94% 12.85%
The Commission during the current tariff proceedings while analysing the ABR of various
consumer categories observed that the ABR of PTW consumer category was Rs. 1.41/kWh which
was substantially lower than the approved Energy charge of Rs. 1.55/kWh. The Commission,
therefore, directed the Petitioner to submit necessary justification for such anomaly. The Petitioner
in response to lower ABR recorded for PTW consumers submitted that the matter was being
discussed with field officers and prima-facie it was found that the average billing rate of some
divisions of PTW Category was low because of the reason that the previous billing was withdrawn.
The category wise sales of UPCL for FY 2016-17 are being discussed hereunder:
a) Domestic Consumers
Based on the detailed analysis of the breakup of sales data submitted by the Petitioner for FY
2016-17, it is observed that for the Departmental Employees of PTCUL and UPCL, the load factor
(sales/kW of connected load) for consumers whose consumption was recorded on assessment basis
was substantially higher than the load factor for consumers whose consumption was recorded on
the basis of actual meter reading. The distribution licensee did not substantiate the basis of
recording assessed sales. Further, it was observed from the data submitted by UPCL that around 73
consumers were still unmetered for which tariff had already been discontinued. The Petitioner was

directed to submit the reasons behind existence of unmetered connections, the Petitioner in
response after cross checking with billing database submitted that no bill was generated during FY
2016-17 for unmetered consumers and as of today no unmetered consumers exists in UPCL.
The Commission in its previous Tariff Orders has been recasting the unmetered sales and
assessed sales based on the load factor of metered consumers. However, for FY 2016-17 it was
observed that except for Departmental Employees and Public Lamps category, the consumption on
assessment basis for other categories was almost equal to that billed on the basis of metered sales
and, therefore, re-casting of sales has not been done on this account.
The Commission has, however, recasted the sales of departmental employees on the basis of
the load factor of the other metered domestic consumers as the load factor for these employees are
substantially higher than the load factor of other domestic consumers which indicates that though
as per the submission of UPCL, these consumers have been metered, recording of consumption of
these consumers is either not on the basis of actual consumption as the departmental employees are
availing electricity on a fixed charge basis or excess consumption of electricity is being done by the
employees as the same is almost free to the employees which clearly is a wastage of electricity and
cannot be allowed at the cost of other consumers.
Accordingly, based on the above, the total re-casted sales for Domestic Category for FY
2016-17 works out to 2466 MU against 2486 MU submitted by UPCL and the same is summarised
in the Table below:
Table 3.6: Re-casted Sales for Domestic Category for FY 2016-17 (MU)
Based on Actual Meter Reading Based on Assessment Unmetered Total
Sales (MU)
Consumers
Consumers
Consumers
Sales (MU)
Number of
Number of
Load (KW)
Load (KW)
Load (KW)
Connected
Connected
Connected
Sales/kW/
Sales/kW/
Re-casted
Recasted
Number
Sub-Category
Month
Month
(MU)
(MU)
Sales
Sales
Sales
MU)
of
BPL and Kutir Jyoti 335845 336281 183.95 45.58 17453 17476 9.56 45.59 193.51
Other Domestic
1395439 2142603 2095.40 81.50 72518 111346 108.89 81.50 13 13 0 2204.29
Consumers
UPCL Employees and
4111 9502 8.51 74.63 3261 15493 30.97 166.58 13.88 22.39
Pensioners
UJVNL Employees and
552 1753 3.16 150.22 349 415 0.71 142.57 2.12 2.12
Pensioners
PTCUL Employees and
230 563 1.15 170.22 162 689 1.52 183.84 1.22 1.22
Pensioners
Single Point Bulk Supply 104 25319 42.32 42.32
Domestic 1736281 2516022 2334.50 77.32 93743 145418 151.65 86.90 13 13 0 2465.85

The Commission also examined the data of departmental employees of UPCL, PTCUL and
UJVN Ltd. which is given in the Table hereunder:
Table 3.7: Departmental Employees of UPCL, PTCUL and UJVN Ltd. as on

31.03.2016 and 31.03.2017 as per Commercial Diary
As on 31.03.2016 As on 31.03.2017
S.
Particulars Load Consumption Load Consumption
No. Nos. Nos.
(kW) (MU) (kW) (MU)
1. UPCL employees
a. Serving Employees 4,263 14,566 51.862 4,132 14,163 26.301
b. Pensioners 2,813 8,758 14.565 2,419 8,732 10.475
c. Family Pensioners 866 2,250 2.339 821 2,100 2.701
UJVN Ltd.
2. employees and 788 1,921 3.696 901 2,168 3.872
Pensioners
PTCUL employees
3. 378 1,217 1.678 392 1,252 2.674
and Pensioners
Total 9,108 28,712 74.14 8,665 28,415 46.023
From the Table above, it is surprising to note that the number of serving employees of UPCL
has reduced by 131, pensioners of UPCL has reduced by 394 and the number of family pensioners
by 45 from 31.03.2016 to 31.03.2017. UPCL in its commercial diary has shown its serving employees
as on 31.03.2017 as 4,132, however, for calculation of its employee expenses it has shown the
existing employees as on 31.03.2017 as 3201, i.e. in commercial diary it is showing 931 employees
more which is unacceptable. It is all the more surprising that the number of pensioners has reduced
by 394 during 31.03.2016 to 31.03.2017, however, the load has merely reduced by 26 kW. Hence, it
appears that the commercial diary is not reliable, which is also evident not only from the reduction
in 500 number of employees/pensioners/family pensioner of UPCL but also from the sudden
reduction in consumption pattern of the departmental employees given in the Table below:
Table 3.8: Consumption Pattern of Departmental Employees

S. As on 31.03.2016 As on 31.03.2017
Particulars
No. (Units/consumer/month) (Units/consumer/month)
1. UPCL Employees
a. Serving Employees 1,013.80 530.43
b. Pensioners 431.48 360.86
c. Family Pensioners 225.08 274.16
UJVN Ltd. Employees and
2. 390.86 358.12
Pensioners
PTCUL Employees and
3. 369.93 568.45
Pensioners

As can be seen from the Table above, except for family pensioners of UPCL and PTCUL’s
employees and pensioners, the specific consumption of all other categories of employees has
reduced, more so in case of UPCL’s serving employees the reduction is to the extent of almost half.
Thus, this aspect needs investigation. Accordingly, UPCL is directed to submit the bills of all the
departmental employees for FY 2016-17 within 2 months of the date of the Order before the
Commission. UPCL is also directed to reconcile the figures of departmental employees in the
commercial data as well as that claimed for calculation of employee expenses and submit the
same to the Commission within 2 months of the date of the Order.
b) PTW Category:
Based on the detailed analysis of the breakup of sales data submitted for FY 2016-17 and the
commercial diary, it is observed that though the load factor of consumers billed on assessment basis
was almost similar to the load factor of the consumers whose consumption was recorded on the
basis of actual meter reading, however, it was observed that the ABR for the category was Rs.
1.41/kWh as against the energy charge of Rs. 1.55/kWh approved by the Commission. The
Commission directed the Petitioner to submit the justification for such variation. The Petitioner in
response submitted that the matter was discussed with the field officers and prima-facie it was
found that the average billing rate in some divisions for PTW Category was low because of the
reason that the previous billing was withdrawn. Since the Petitioner submitted that the reason of
lower ABR was due to the fact that the previous billing was withdrawn for some of the consumers,
however, sales for them was not withdrawn, accordingly, the Commission does not find any reason
to include such sales for which the billing was withdrawn. Accordingly, the Commission has,
therefore, adjusted the sales of PTW consumers considering the approved energy charge of Rs.
1.55/kWh. However, the Petitioner is directed to instruct its field offices to carry out the
corresponding corrections in sales also in cases where billing is withdrawn. In future if such
instance comes to the knowledge of the Commission, punitive action under Section 142 of the
Electricity Act, 2003 may be taken against the errant officers of UPCL.
Accordingly, based on the above, the total re-casted sales for PTW Category for FY 2016-17
works out to 319.16 MU as against 350.49 MU submitted by UPCL.

c) Other Categories:
For some other categories, i.e. Non-Domestic, PWW, GIS, Public Lamps and LT Industries,
based on the analysis of the breakup of sales data submitted for FY 2016-17, it is observed that only
for public lamp category, the load factor of consumers whose consumption was recorded on
assessment basis was marginally higher than the load factor of those consumers whose
consumption was recorded on the basis of actual meter reading. The Commission in its previous
Tariff Orders has been recasting the assessed sales based on the load factor of the metered
consumers. For recasting sales for the category, the Commission has considered the load factor of
the metered consumers as the basis for deriving the sales of consumers billed on assessment basis.
Table 3.9: Re-casted sales for Other Categories for FY 2016-17 (MU)
Based on Actual Meter Reading Based on Assessment Unmetered Total
of Consumers (No)
Sales/kW/Month
Sales/kW/Month
Consumers (No)
Consumers (No)
Re-casted Sales
Re-casted Sales
Sales (MU)
Sales (MU)
Sales (MU)
Number of
Number of
Load (KW)
Load (KW)
Load (KW)
Connected
Connected
Connected
Number
Sub-Category
(MU)
(MU)
Non-domestic 208480 900850 1146.88 106.09 10834 22752 27.3 99.99 1174.18
LT Industry 9699 205549 294.31 119.32 398 4067 5.82 119.25 300.13
Public Lamps 1259 13271 45.45 285.40 52 552 1.91 288.35 1.89 14 180 1.05 47.34
GIS 1593 57649 140.00 202.37 58 2091 5.08 202.45 145.08
PWW 1404 78177 350.88 374.02 47 2418 7.16 246.76 358.04
d) HT Industry
The Petitioner submitted the sales to HT Industry of 5508.03 MU for FY 2016-17. The
Commission in this regard sought clarification from UPCL whether the sales made to HT Industrial
category has been adjusted for power consumed by HT Industrial consumers through open access.
The Petitioner in its reply submitted that the energy availed through open access energy by HT
Industrial consumers has been adjusted from the consumption units recorded in respect of HT
Industries. As the Petitioner has correctly submitted the sales for this category by excluding the
energy consumed by HT Industries through open access, the Commission has approved the sales
for HT Industries as submitted by the Petitioner.
Based on the above analysis, the category wise sale for FY 2016-17 as re-worked by the
Commission is as shown in the Table below:

Table 3.10: Category-wise Sales for FY 2016-17 (MU)

Approved in the
Claimed in the Approved after
Categories Tariff Order dated
Petition Truing Up
05.04.2016
Domestic (RTS - 1) 2,800.54 2,486.16 2,465.85
Non-domestic, incl. Commercial (RTS - 2) 1,256.82 1,178.02 1,178.02
Public Lamps (RTS - 3) 49.23 48.40 47.34
Private Tubewell/Pump Sets (RTS - 4) 318.57 350.77 319.16
Government Irrigation System (RTS - 5) 123.18 145.08 145.08
Public Water Works (RTS - 6) 361.63 358.04 358.04
Industrial Consumers (RTS - 7) 6,046.51 5,808.16 5,808.16
Mixed Load (RTS - 8) 213.80 178.11 178.11
Railway Traction (RTS - 9) 17.47 19.23 19.23
Total 11187.75 10571.97 10518.99
3.2.2 Distribution Losses
The Petitioner in its Petition has submitted its distribution losses for FY 2016-17 as 16.68%.
The Commission for FY 2016-17 had approved the distribution losses of 15.00% based on the loss
reduction trajectory approved in the MYT Order for the Control Period from FY 2016-17 to FY 2018-
19. However, as per the actual data submitted by the Petitioner and the sales approved by the
Commission, the actual distribution losses for FY 2016-17 works out to 17.10%.
The Commission, in accordance with the approach adopted in its previous Orders, has
allowed the actual quantum of power purchase made by the Petitioner. Considering the actual
energy input of 12,688.46 MU at distribution periphery (T&D interface) for FY 2016-17 and applying
the approved loss level of 15.00% for the year, the Commission re-estimated the sales of 10785.19
MU for FY 2016-17. As against this sale of 10785.19 MU, the actual re-casted sales approved by the
Commission for FY 2016-17 is 10518.99 MU. Therefore, there is a loss of sales to the tune of 266.20
MU on account of commercial inefficiencies of the Petitioner resulting from its failure to achieve
distribution losses target approved by the Commission. The Commission has worked out the
average billing rate of Rs. 4.56/kWh on the approved re-casted sales of 10518.99 MU. The
Commission has also adjusted the revenue from sales of power of Rs. 4791.15 Crore submitted by
UPCL for FY 2016-17, by reducing the revenue corresponding to the sales reduced for PTCUL and
UJVN Ltd. employees as on re-casted sales since their Average billing rate was much higher than
the ABR of other domestic consumers and whereas by adding the revenue for UPCL’s departmental
employees as on re-casted sales the ABR was working less than the ABR of other domestic

consumers. Accordingly, the adjusted revenue for FY 2016-17 works out to Rs. 4793.87 Crore.
Accordingly, the Commission has computed the additional revenue on account of loss in sales due
to higher distribution loss of Rs. 121.31 Crore for FY 2016-17. The following Table shows actual
distribution loss and approved distribution loss along with efficiency loss for FY 2016-17 as
explained above.
Table 3.11: Assessed Distribution losses for FY 2016-17 (MU)

Approved in the Approved
Revised
Particulars Tariff Order after Truing
Claim
dated 05.04.2016 Up
Actual Energy Input at T-D Interface / Power
13162.05 12688.46 12688.46
Purchase Requirement (MU)
Actual/ Recasted Sales (MU) 11187.75 10571.69 10518.99
Actual Distribution Loss (MU) 1974.31 2116.77 2169.47
Distribution Loss Level (%) 15.00% 16.68% 17.10%
Commercial Loss Reduction (%) 0.00% 0.00% 0.00%
(Loss)/Gain of sales due to
inefficiency/efficiency (MU) (Normative 0.00 0.00 (266.20)
Sales-Actual Re-casted Sales)
Approved Distribution Loss (%) 15.00% 15.00% 15.00%
Total Normative Sales (MU) 11187.75 10571.69 10785.19
Further, since distribution loss is a controllable parameter, the Commission has carried out
the sharing of the impact of excess distribution loss in accordance with the provisions of UERC
Tariff Regulations, 2015.
3.2.3 Power Purchase Expenses (Including Transmission Charges)
The comparison of source wise power purchase quantum and cost as approved by the
Commission in the Tariff Order for FY 2016-17 and actual as claimed by UPCL for FY 2016-17 is as
shown in the Table below:

Table 3.12: Power Purchase Cost approved in the Tariff Order Vs Actual Power Purchase
Cost for FY 2016-17 (Rs. Crore)
Approved in the Tariff Order Claimed by UPCL
Source Quantum Total cost Rate Quantum Total cost Rate
(MU) (Rs. Crore) (Rs./kWh) (MU) (Rs. Crore) (Rs./kWh)
UJVN Ltd.* 4113.15 485.52 1.18 3939.84 953.63* 2.42
NHPC 750.51 226.86 3.02 720.05 284.07 3.62
THDC 662.11 169.32 2.56 679.57 220.03 3.24
NTPC 2602.69 865.82 3.33 2603.36 848.69 3.26
NPCIL 265.95 83.65 3.15 277.23 89.48 3.23
Vishnu Prayag 195.93 31.83 1.62 219.07 56.04 2.56
SJVNL 221.55 84.83 3.83 273.97 98.61 3.60
Other IPPs 2409.27 930.52 3.86 2675.33 888.60 3.32
Deficit Purchase including UI 2670.72 971.07 3.64 2255.31 898.77 3.99
Banking Received/(Paid) - - - (955.27) (350.26) 3.67
RPO 416.24 197.71 4.75 - - -
PTCUL - 261.04 - - 273.78 -
PGCIL - 385.26 - - 415.37 -
Total 14308.12 4693.43 3.28 12688.46 4971.03 3.92
*Including recovery of past arrears of Rs. 170.64 Crore.
The Commission with regard to the power purchase cost submitted by the Petitioner sought
the following information from the Petitioner:
a) Justification for the rate of UI drawal in the month of May, 2016 (Rs. 18.59/kWh) and
December, 2016 (Rs. 6.55/kWh) being very high.
b) Basis of computing cost of banked energy returned submitted as Rs. 350.26 Crore and
source to meet the same and whether any provisions have been made in the cost of
power purchase claimed for FY 2016-17.
c) Details of cost of free power provided for in the accounts and the cost paid to the State
Government in this regard from FY 2011-12 to FY 2016-17.
The Petitioner in its reply with regard to increase in cost of UI overdrawals submitted that
Over Drawl and Under Drawl is a continuous process and under ABT regime the same is integrated
at every 15 minutes time interval, i.e. in 96 slots during the day. The average frequency in each time
block determines the UI rate which is applicable on the Over Drawl /Under Drawl quantum of
energy. The Petitioner further submitted that the net UI during the month of May, 2016 was actually
under drawl of 24.69 MU and net amount paid for UI during the month was actually Rs. 1.67 Crore

with credit adjustment amount of Rs. 1.19 Crore. Similarly net UI during the month of December,
2016 was actually over drawl of 17.88 MU and net amount paid for UI during the month was
actually Rs. 9.18 Crore with debit adjustment amount of Rs. 3.64 Crore. UPCL further submitted
that certain adjustments e.g. adjustments for equalizing total deviation charges payable and
receivable, adjustments made on account of Nuclear Station being exempted from paying deviation
charges are also included in the net UI charges paid during the month. The Petitioner further
submitted that for reasons stated above the net UI and amount during the month cannot be the
basis for calculation of per unit charges.
The Commission does not agree with the justification forwarded by the Petitioner and has
observed that the Petitioner has availed professional services of M/s Quenext Decision Sciences Pvt.
Ltd. w.e.f. April, 2016 to leverage real time opportunities including URS to reduce the cost of
meeting the load of the end customer, merit order to integrate market and reduce imbalances and
has claimed the cost of Rs. 3.05 Crore additionally in A&G expenses. In view of the same, the
Commission in the interest of the consumers cannot allow to pass on the impact of overdrawal at
such higher rates. The Commission in its Order dated April 11, 2015 had already directed the
Petitioner to restrict the net drawal from the grid within its drawal schedules whenever the system
frequency is below 49.90 Hz in order to ensure grid discipline which in the present case has not
been followed.
The Commission further observes, that the charges for deviation at 49.90 Hz as per
Regulation 5 of CERC (Deviation Settlement Mechanism and related matters), Regulations 2014 is
Rs. 4.07/kWh. The Commission to protect consumer interest and to ensure grid discipline has,
therefore, curtailed any overdrawal above the rate of Rs. 4.07/kWh in FY 2016-17. The Commission
has, therefore, disallowed Rs. 11.03 Crore on account of overdrawal at the rate higher than Rs.
4.07/kWh as shown in the Table below:

Table 3.13: Cost of UI Overdrawal approved by the Commission

Cost Actual rate of Approved Cost
Approved Rate of
MU Claimed Drawal Cost (Rs. Disallowed
Month Drawal (Rs./kWh)
(Rs. Cr.) Rs/kWh Cr.) (Rs. Cr)
(A) (B) C= (Bx10/A) D= Min (C, 4.07) E=DxA/10 F=(B-E)
April 6.60 3.60 5.46 4.07 2.69 0.91
May 1.70 3.17 18.60 4.07 0.69 2.47
June 8.01 0.61 0.76 0.76 0.61 -
July 10.64 2.84 2.67 2.67 2.84 -
August 18.39 6.12 3.33 3.33 6.12 -
September 39.90 11.86 2.97 2.97 11.86 -
October 17.40 8.19 4.71 4.07 7.08 1.11
November 7.06 3.83 5.43 4.07 2.87 0.96
December 17.88 11.72 6.55 4.07 7.28 4.44
January 19.03 8.88 4.66 4.07 7.75 1.13
February 28.02 6.64 2.37 2.37 6.64 -
March 29.33 8.09 2.76 2.76 8.09 -
Total for the year 203.98 75.55 64.52 11.03
With regard to the cost of banked energy booked by the Petitioner, the Petitioner submitted
that as per agreement dated September 09, 2016 and LOI no.1275 dated April 30, 2016 against tender
specification No. 01/16-17, 95.98 MU and 60.17 MU of power was returned to M/s HPPC (M/s
Haryana Power Purchase Committee) through M/s TPTCL in the month of August 2016 and
September 2016 respectively. The rate of purchase of power was Rs. 2.69 per kWh and Rs. 2.66 per
kWh for the month of August 2016 and September 2016 respectively at Regional Periphery. The
Petitioner further submitted that the transmission losses up to Haryana State periphery were borne
by UPCL and the agreement was approved by the Commission vide Order dated June 21, 2016.
As per agreement dated September 16, 2016 and LOI No. 2392 dated July 04, 2016 against
Tender Specification No. 03/16-17, 53.059 MU, 64.320 MU and 63.195 MU of power was returned to
M/s HPPC (M/s Haryana Power Purchase Committee) through M/s Manikaran Power Ltd. in the
month of July 2016, August 2016 and September 2016 respectively. The rate of purchase of Power
was Rs. 3.13 per kWh at Haryana State Periphery. The Petitioner submitted that the agreement was
approved by the Commission vide Order dated September 06, 2016.
The Petitioner further submitted that the remaining 658.28 MU power was returned by
UPCL from its pool of Power Purchase. The Petitioner further submitted the copies of above
mentioned agreements alongwith details of power procured. The Petitioner also submitted that the
power purchase cost of FY 2016-17 does not include any provisions made on account of Banking of
Power. However, power was returned under banking arrangement in FY 2016-17 for power
received under such arrangement in FY 2015-16. Therefore, a sum of Rs. 350.26 Crore duly provided
in FY 2015-16 was reversed in FY 2016-17 and shown as reduction in Power Purchase expenses in
FY 2016-17 and all the bills of Power Purchase suppliers for the period up to March 2017 were
recorded in FY 2016-17. The Petitioner further submitted that no other provisions were made in
Power Purchase cost in FY 2016-17.
The Commission has gone through the submissions of the Petitioner and finds the same in
order and, therefore, the Commission approves the cost of banked energy as claimed by the
Petitioner.
In the past, the Petitioner has been seeking truing up of free power rate which the
Commission has been allowing. The Commission, however, observed from the audited accounts of
the Petitioner that the Petitioner instead of remitting the trued up amount on account of revision of
free power rate to GoU or creating equivalent liability in the accounts has been booking the same as
its revenues.
The Petitioner in its current Petition submitted that the rate of free power approved for FY
2016-17 was Rs. 1.62/kWh on the basis of which the Petitioner has raised bills in FY 2016-17. The
Petitioner in the current Petition has revised the rate of free power on the basis of actual power
purchase from hydro generating stations as Rs. 2.57/kWh. The Petitioner has, accordingly, sought
cost of free power as Rs. 255.89 Crore at the rate of Rs. 2.57/kWh as against Rs. 162.04 Crore booked
at the rate of Rs. 1.62/kWh in the audited accounts of FY 2016-17.
The year wise details of cost of free power as booked in the accounts, cost of free power
trued up by the Commission and the amount remitted to GoU by the Petitioner in this regard from
FY 2011-12 to FY 2016-17 is shown as follows:
Table 3.14: Details of Cost of Free Power (Rs. Crore)

Cost of free power Cost of free Cost of free Excess cost of free
Year as per Audited power actually power trued up power allowed by the
Accounts paid to GoU (Rs. Crore) Commission (Rs. Crore)
FY 2011-12 191.67 16.70 210.90 19.23
FY 2012-13 197.03 40.00 191.04 -5.99
FY 2013-14 118.46 35.84 122.93 4.47
FY 2014-15 136.78 21.65 154.92 18.14
FY 2015-16 141.81 65.27 206.70 64.89
FY 2016-17 162.04 527.45 162.04 -
Total 947.79 706.91 1,048.53 100.74

As given in the Table above, it is observed that the Petitioner has not even remitted the
complete amount that has been booked in the accounts. Further, amount recovered on account of
revision of free power rate from FY 2011-12 to FY 2015-16 has also not been booked in the
subsequent years’ audited accounts and has been considered by the Petitioner as its revenues. The
Commission takes strong exception to the same and is of the view that the Petitioner cannot be
allowed to retain the dues that do not belong to it by burdening the consumers. The Commission is
also of the view that while carrying out the truing up for the ensuing years, cost of free power shall
be considered as that provided in the audited accounts by the Petitioner subject to the ceiling limit
of weighted average cost of power available to UPCL from the hydro generating stations.
Accordingly, the Commission has, therefore, not carried out truing up of free power rate for
FY 2016-17. Further, the Commission has also adjusted the excess cost of free power of Rs. 100.74
Crore allowed to it as evident from the Table above from FY 2011-12 to FY 2015-16. The
Commission has, accordingly, adjusted the said amount of Rs. 100.74 Crore towards excess cost of
free power allowed to UPCL from the ARR of FY 2018-19 as detailed in Chapter 4 of this Order.
Further, the Petitioner is also directed to submit the details of cost of free power as booked in the
accounts, cost of free power trued up by the Commission and the amount remitted to GoU by the
Petitioner in this regard from FY 2001-02 to FY 2010-11 within 3 months of the date of the Order.
The expenses towards free power as claimed by the Petitioner and that allowed by the
Commission for FY 2016-17 is as shown in the Table below:
Table 3.15: Power Purchase Cost claimed by UPCL and approved by the Commission
for FY 2016-17 (Rs. Crore)
As per Audited Claimed by the Approved by the
Particulars
Accounts Petitioner Commission
Cost of Free Power 162.04 255.89 162.04
Accordingly, the power purchase cost approved by the Commission on truing up for FY
2016-17 is as shown in the Table below:
Table 3.16: Power Purchase Cost claimed by UPCL and approved by the
Commission for FY 2016-17 (Rs. Crore)
Particulars Claimed by UPCL Approved by the Commission
Power Purchase Expenses 4111.24 4006.36
UJVN Ltd. Arrear 170.64 170.64
Transmission Charges-PGCIL 415.37 415.37
Transmission Charges- PTCUL 273.78 273.78
Total Power Purchase Cost 4971.03 4866.15

3.2.4 Operation and Maintenance (O&M) Expenses
O&M expenses comprises of Employee Expenses, A&G Expenses and R&M Expenses, i.e.
expenditure on staff, administration and general expenses and repairs and maintenance etc. For
estimating the O&M expenses for the second Control Period, Regulation 62 of UERC Tariff
Regulations, 2015 specifies as under:
“(1) The O&M expenses for the first year of the Control Period will be approved by the Commission
taking into account the actual O&M expenses for last five years till Base Year subject to prudence
check and any other factors considered appropriate by the Commission.
(2) The O&M expenses for the nth year and also for the year immediately preceding the Control
Period, i.e. FY 2015-16, shall be approved based on the formula given below:-
O&Mn = R&Mn + EMPn + A&Gn
Where –
 O&Mn – Operation and Maintenance expense for the nth year;
 EMPn – Employee Costs for the nth year;
 R&Mn – Repair and Maintenance Costs for the nth year;
 A&Gn – Administrative and General Costs for the nth year;
(3) The above components shall be computed in the manner specified below:
EMPn = (EMPn-1) x (1+Gn) x (1+CPIinflation)
R&Mn = K x (GFAn-1) x (1+WPIinflation) and
A&Gn = (A&Gn-1) x (1+WPIinflation) + Provision
Where -
 EMPn-1 – Employee Costs for the (n-1)th year;
 A&G n-1 – Administrative and General Costs for the (n-1)th year;
 Provision: Cost for initiatives or other one-time expenses as proposed by the Transmission
Licensee and approved by the Commission after prudence check.

 ‘K’ is a constant specified by the Commission in %. Value of K for each year of the control
period shall be determined by the Commission in the MYT Tariff order based on
Transmission Licensee’s filing, benchmarking of repair and maintenance expenses, approved
repair and maintenance expenses vis-à-vis GFA approved by the Commission in past and any
other factor considered appropriate by the Commission;
 CPI inflation – is the average increase in the Consumer Price Index (CPI) forimmediately
preceding three years;
 WPI Inflation - is the average increase in the Wholesale Price Index (CPI) for immediately
 GFAn-1 – Gross Fixed Asset of the Transmission Licensee for the n-1th year;
 Gn is a growth factor for the nth year. Value of Gn shall be determined by the Commission in
the MYT tariff order for meeting the additional manpower requirement based on
Transmission Licensee’s filings, benchmarking and any other factor that the Commission feels
appropriate:
Provided that in case of a transmission licensee is governed by Government pay structure, the
Commission may consider allowing a separate provision in Employee expenses towards the
impact of VIIth Pay Commission.
Provided that repair and maintenance expenses determined shall be utilised towards repair and
maintenance works only.”
3.2.4.1 Employee Expenses
The Petitioner submitted that the normative employee expenses for FY 2016-17 has been
arrived at as per the methodology adopted by the Commission in its Tariff Order dated March 29,
2017 in accordance with UERC Tariff Regulations, 2015.
The Petitioner submitted that it had to bear the responsibility of paying enhanced pension
which was on account of pay revision in third time scale with effect from 01.01.1996 due to which
pension and family pension was revised for the employees who retired between 01.01.1996 and
20.07.2010. The Petitioner further submitted that since the enhanced pension was not included in
the base employee expenses and is a statutory liability for the Petitioner, the same has been claimed
additionally in FY 2016-17.

The Petitioner submitted that the actual impact of enhanced pension for FY 2016-17 was Rs.
8.84 Crore. The Petitioner further submitted that the number of employees has reduced to 3201 by
the end of 31.03.2017 on account of retirements, therefore, the growth factor has been considered as
zero. Further, actual capitalization rate as per the audited accounts have been considered for
arriving at the normative employee cost.
The Petitioner has claimed the normative employee expenses for FY 2016-17 of Rs. 291.16
Crore as shown in the Table below:
Table 3.17: Revised Employee Expenses as claimed by the

Petitioner (Rs. Crore)
Particulars FY 2016-17
Empn-1 312.14
Inflation Factor 7.21%
Growth Factor 0.00%
Gross Employee Expenses 334.63
Capitalisation Rate 15.63%
Less: Employee Expenses Capitalised 52.30
Net Employee Expenses 282.32
Impact of enhanced pension 8.84
Employee Expenses 291.16
The Commission in its Order dated March 29, 2017 had re-worked the normative employee
expenses for the second Control Period in accordance with UERC Tariff Regulations, 2015. The
Commission in the said Order had considered the gross normative employee expenses approved in
the true up for FY 2015-16 for projecting the employee expense for FY 2016-17 and FY 2017-18. The
Commission had further revised the impact of VII pay commission from 20% considered in its MYT
Order to 15% in its Order dated March 29, 2017. The Commission had approved the trued up
normative gross employee expenses of Rs. 312.13 Crore for FY 2015-16. Considering the same as the
base and in accordance with the UERC Tariff Regulations, 2015 the Commission has computed the
normative employee expenses for FY 2016-17. Regarding the growth factor, the Commission
observed that the number of employees of UPCL has reduced from FY 2015-16 to FY 2016-17 as the
number of retirement of employees outpaced the recruitment of employees during the year. The
Commission has, therefore, considered ‘Gn’as zero. The employee expenses so computed have then
been escalated by the same CPI inflation of 7.21%.
The Commission has considered the capitalisation of expenses in the same proportion of
actual capitalisation of expenses to the actual gross expenses. Further, in line with the approach

adopted by the Commission in the true up for FY 2015-16, the Commission has considered the
impact of enhanced pension as claimed by UPCL considering the statutory liability of the Petitioner.
However, the Commission would again like to caution the Petitioner that any further allowance or
incentives or benefits granted to its employees will have to be borne by UPCL from its own
resources or through increased efficiency.
The normative employee expense approved by the Commission for FY 2016-17 is as shown
in the Table below:
Table 3.18: Approved Employee Expenses for FY 2016-17 (Rs. Crore)

Approved in Actual as Normative
Particulars the Tariff per Audited Claimed by
Approved
Order Accounts UPCL
Employee expenses 435.95 267.99 291.16 285.10
3.2.4.2 Repair and Maintenance
The Commission had approved the R&M expenses of Rs. 116.74 Crore for FY 2016-17 in its
MYT Order dated April 05, 2016. As against the same, the actual R&M expenses for FY 2016-17 as
per the audited accounts are Rs. 113.70 Crore. The Petitioner has claimed the normative R&M
expenses of Rs. 113.49 Crore.
The Commission in its MYT Order had considered the ‘K’ factor of 2.67% for computation of
the normative R&M expenses for FY 2016-17 in accordance with the UERC Tariff Regulations, 2015.
The Commission for truing up of FY 2016-17 has considered the same K factor and has reworked
the R&M expenses considering the Opening GFA for FY 2016-17. The Commission has considered
the inflation factor of 1.83% which is the average of WPI inflation for the preceding three years of
FY 2016-17. The normative R&M expenses trued up by the Commission for FY 2016-17 is as shown
in the Table below:
Table 3.19: Approved R&M Expenses for FY 2016-17 (Rs. Crore)

Approved
Order Accounts UPCL
R&M Expenses 116.74 113.70 113.49 108.23
3.2.4.3 A&G Expenses
The Commission had approved the A&G expenses of Rs. 22.05 Crore for FY 2016-17 in its
Tariff Order dated April 05, 2016. As against the same, the actual A&G expenses for FY 2016-17 as
per the audited accounts were Rs. 25.91 Crore. The Petitioner has claimed the normative A&G
expenses of Rs. 32.68 Crore for FY 2016-17. The Petitioner submitted that the actual A&G expenses
of Rs. 25.91 Crore excluded an amount of Rs. 11.25 Crore paid against the penalty imposed by the
Commission on account of delay in releasing new LT connections.
The Commission in its Order dated March 29, 2017 had re-worked the normative A&G
expenses for the second Control Period in accordance with UERC Tariff Regulations, 2015. The
Commission had considered the normative A&G expenses approved in the true up for FY 2015-16
for projecting the A&G expense for FY 2016-17 and FY 2017-18. The Commission in this Order has
considered the same approach for computing A&G expenses for FY 2016-17. The Commission had
considered WPI inflation of 1.83% which is the average of WPI Inflation for the preceding three
years of FY 2016-17. The Commission has considered the capitalisation of expenses in the same
proportion of actual capitalisation of expenses to the actual gross A&G expenses.
In addition to the above, the Petitioner in its Petition has submitted that a provision of Rs.
8.59 Crore against cost of data centre and other expenses relating to R-APDRP projects have been
included. The Petitioner further submitted that these expenses are primarily towards bandwidth
charges for data centre, annual maintenance charges for the software and hardware installed under
the various R-APDRP works, etc. The Petitioner further submitted the details of additional A&G
expenses claimed as follows:
Table 3.20: Additional A&G Expenses as claimed by the Petitioner (Rs. Crore)
Particulars Amount
Expenditure on SMS Gateway 0.01
Network Bandwidth Service Provider (M/s Tata tele Services) 1.11
Expenditure for Executives for Data Centre (CC-Staffing) 0.52
Bandwidth charges paid to BSNL 0.92
Idea Cellular Ltd., Dehradun 0.26
Disaster Recovery Center - Haldwani (M/s Wipro Ltd.) 1.21
M/s Nikom Infrasolution Pvt. Ltd. Delhi 0.34
AMC Cost for installed Hardware at Data Center Dehradun consists of various server
0.82
and storage. (Redington India Ltd.)
IBM software License Cost for the installed IBM Tivoli and IBM Network management
1.00
software (M/s Sify Technologies Ltd.)
Microsoft License Cost 0.98
Red Hat Operating System license cost 1.18
Misc. Expenses 0.25
Total Additional A&G expense 8.59

The Petitioner was directed to submit whether the cost of data centre and cost associated
with R-APDRP projects claimed for FY 2016-17 has already been incurred or merely provisions have
been made. The Petitioner was also required to submit the operational cost towards maintenance of
data centre under R-APDRP Project since the creation of the Data Centre in the year 2010-11 along
with contracts of AMC.
The Petitioner in response submitted that the cost of Rs. 8.59 Crore has already been
incurred and the same are not provisions. The Petitioner also submitted the operation cost towards
maintenance of data centre as follows:
Table 3.21: Operational Cost towards maintenance of Data Centre as

submitted by the Petitioner (Rs. Crore)
Financial Year Expenditure
2010-11 0.9509
2011-12 2.6159
2012-13 1.0921
2013-14 4.3707
2014-15 3.5065
2015-16 6.5206
2016-17 9.3905
2017-18 (upto December) 5.1448
The Commission observed that the Petitioner has submitted operational cost of Rs. 9.39
Crore towards maintenance of data centre in FY 2016-17, however, the same has been claimed as Rs.
8.59 Crore in the Petition. The Commission, accordingly, sought reconciliation of both the figures.
The Petitioner in response revised its submission of additional cost of A&G expenses as per audited
accounts as follows:
Table 3.22: Additional Cost of A&G Expenses as submitted by the Petitioner (Rs.)
S.
GL Code Description FY 2016-17
No.
1. 74.142 R&M-Other Transmissions Plant & Equipment 13,77,000
2. 74.148 R&M-Batteries including charging equipment 18,04,611
3. 74.599 R&M-Other Misc. Exp. 1,21,03,255
4. 74.806 R&M-Computers 1,24,63,515
5. 76.107 A&G-Insurance of other assets 1,21,343
6. 76.111 A&G-Telephone & Trunk Calls 11,55,374
7. 76.114 A&G-Bandwidth Charges 1,99,35,496
8. 76.125 A&G-Other Professional Charges 34,451
9. 76.158 A&G- Electricity Charges 44,11,109
10. 76.171 A&G-PurvaSainik Kalyan Nigam Ltd. 48,38,897
11. 76.172 A&G- Facility Management Services (FMS) 29,98,270
12. 76.19 A&G- Misc. Expenses 500
Total Expenses 6,12,43,821
The Commission has gone through the submissions of the Petitioner and observes that the
expenses booked under Sr. No. 1 to 4 in the Table above amounting to Rs. 2.79 Crore pertains to
R&M expenses which has already been allowed to the Petitioner as R&M expenses and, therefore,
the same doesn’t qualify as additional A&G Expenses. The Commission has, therefore, not
considered the same. The Commission has allowed the balance additional A&G Expenses of Rs. 3.35
Crore towards maintenance of Data Centre.
The Petitioner further submitted that it has also availed services of Quenext Decisions
Sciences Pvt. Ltd. for data forecasting which has helped UPCL in planning its power purchase. The
services of M/s Quenext included the following:
a. In integrating “MARKET” as part of “MERIT ORDER” with increased degree of

confidence and leverage every market opportunity to reduce the cost of power.
b. Leverage real time opportunities including URS to reduce the cost of meeting end
customer load.
c. Reduced incidences of imbalances by more than 30% leveraging real time foresights.
The Commission has gone through the submissions of the Petitioner and observes that the
Petitioner has utilised professional service for cost effective power procurement. The Commission
has considered the additional cost on this account, however, since professional services have been
availed therefore, the Commission directs the Petitioner that it should neither overdraw power at
frequency below 49.90 Hz nor resort to load shedding due to improper procurement planning.
Further, any drawal below 49.90 Hz shall not be allowed by the Commission.
The Commission has further considered License fees of Rs. 2.16 Crore paid by the Petitioner
in FY 2016-17. However, the Commission would like to caution the Petitioner to control its A&G
expenses and exercise proper prudence in incurring the same.
The normative A&G expense approved by the Commission for FY 2016-17 is as shown in the
Table below:
Table 3.23: Approved A&G expenses for FY 2016-17 (Rs. Crore)

Approved
Order Accounts UPCL
A&G expenses 22.05 25.91 32.68 26.62
Accordingly, the Commission has allowed net O&M Expenses as shown in the Table below:

Table 3.24: Approved O&M Expenses for FY 2016-17 (Rs. Crore)

Approved in Actual as per Normative
S.
Particulars the Tariff Audited Claimed by
No. Approved
Order Accounts UPCL
1. Employee expenses 435.95 267.99 291.16 285.10
2. R&M expenses 116.74 113.70 113.49 108.23
3. A&G expenses 22.05 25.91 32.68 26.62
Total 574.73 407.60 437.32 419.95
The Commission has further carried out sharing on account of actual and normative O&M
expenses in the subsequent section of this Order.
3.3 Cost of Assets and Financing
3.3.1 Capital cost of Original Assets
As regards the capital cost of original assets, the Commission vide its Order dated April 11,
2015 held as under:
“3.2.5.1 Capital Cost of Original Assets
The Commission observed that the issue of original value of fixed assets for the Petitioner examined in
detail in Paras 5.3.1 and 5.3.2 of the Order dated April 25, 2005. For reasons provided in the said
Order, the original value of GFA as on November 09, 2001 was fixed at Rs. 508 Crore for the
Petitioner, instead of the value of Rs. 1058.18 Crore assigned in the Provisional Transfer Scheme. The
Commission had already recorded the reasons for the same in its previous Tariff Orders. Since, there
is no change in the factual position and the matter is pending before the Hon’ble ATE, the
Commission decides to maintain Status-quo ante.”
In this regard, Hon’ble ATE in its Judgment dated May 18, 2015 in Appeal No. 180 of 2013
ruled as under:
“25. We feel that since it is matter of transfer scheme and apportioning of value of assets between two
States after reorganization, the Appellant should take up the matter with State Government for
issuance of notification on transfer of assets to Uttarakhand from UP. Accordingly decided.”
In light of the Judgment of the Hon’ble ATE, the Commission in its Tariff Order dated April
05, 2016 did not find the need to revise the capital cost of original assets from the earlier approved
value of Rs. 508 Crore for the Petitioner.
The Commission vide its Order dated April 05, 2016 and March 29, 2017 has already carried

out the truing up till FY 2015-16. The year wise GFA addition allowed by the Commission till FY
2015-16 is as shown below:
Table 3.25: Assets base approved by the Commission (Rs. Crore)

Particulars FY 2007-08 FY 2008-09 FY 2009-10 FY 2010-11 FY 2011-12 FY 2012-13 FY 2013-14 FY 2014-15 FY 2015-16
Opening
1227.76 1540.46 1698.88 2019.76 2449.87 2787.04 3017.55 3202.56 3695.78
Balance
Net additions 312.69 158.42 320.88 430.11 337.17 230.50 185.01 493.22 284.78
Closing
1540.46 1698.88 2019.76 2449.87 2787.04 3017.55 3202.56 3695.78 3980.56
Balance
With regard to FY 2016-17, the Petitioner has claimed a net capitalisation of Rs. 238.29 Crore.
The Petitioner was directed to submit the addition of fixed assets into HT and LT works and to
submit the Electrical Inspector clearance for HT works. The Petitioner did not submit the required
details. The Petitioner submitted the Electrical Inspector clearance certificate for only Rs. 222.38
Crore as against total additional capitalisation of Rs. 321.99 Crore in FY 2016-17.
The Commission observes that the Petitioner has capitalised assets amounting to Rs. 3.47
Crore towards Furniture & Fixtures, Vehicles and office equipment for which Electrical Inspector’s
Certificate is not required. The Commission has, therefore, approved additional capitalisation of Rs.
222.38 Crore and Rs. 3.47 Crore amounting to Rs. 225.85 Crore. The Commission has also
considered the Decapitalisation of assets of Rs. 83.70 Crore in FY 2016-17. The Commission has not
allowed a capitalisation of Rs. 96.14 Crore in the absence of clearance by Electrical Inspector as
required under the Rules & also as details of segregation of assets into HT/EHT & LT works in line
with the approach taken by the Commission in its previous Orders.
The Commission has, therefore, approved net additional capitalisation of Rs. 142.15 Crore
for FY 2016-17 as follows:
Table 3.26: Assets base approved by the Commission for

FY 2016-17 (Rs. Crore)
Opening Balance 3980.56
Net additions 142.15
Closing Balance 4122.71

3.3.2 Financing of Capital Cost
3.3.2.1 Truing Up of Capital Related Expenses for FY 2016-17
The Petitioner has claimed GFA addition of Rs. 238.29 Crore for FY 2016-17. The means of
finance submitted by the Petitioner is shown in the Table below:
Table 3.27: Means of Finance for FY 2016-17 as submitted by the

RGGVY Loan 0.00
R-APDRP Part A Loan 0.00
REC Loan 119.41
Deposit Works
67.71
Grant
Internal resources 51.17
Total 238.29
As discussed above, the Commission has approved additional capitalisation of Rs. 142.15
Crore. The means of finance as approved by the Commission is as follows:
Table 3.28: Means of Finance as approved by the Commission

for FY 2016-17 (Rs. Crore)
RGGVY Loan 0.00
R-APDRP Part A Loan 0.00
REC Loan 71.23
Deposit Works
40.39
Grant
Internal resources 30.53
Total 142.15
The Commission has worked out the means of finance of the capitalisation considered by it
in the same proportions of actual capitalisation submitted by the Petitioner.
3.3.2.1.1 Interest and Finance Charges
The Petitioner has claimed Interest and Finance Charges of Rs. 151.21 Crore for FY 2016-17
against the amount of Rs. 135.79 Crore approved by the Commission in the Tariff Order dated April
05, 2016.
The Petitioner submitted that it has claimed interest expenses as per the audited accounts
after considering the following adjustments:

a) The Petitioner has computed the revised opening of the normative loans in view of the
revision in means of finance from FY 2012-13 onwards.
b) Actual interest accrued during the year has been claimed which is net off capitalisation.
c) Government Guarantee fees has been considered on actual basis.
d) The Petitioner has not considered the interest on GPF. However, the Petitioner requested the
Commission to allow interest on GPF as part of interest expense as this is the statutory
liability of the Petitioner. The Petitioner submitted that the Government of Uttarakhand
(GoU) has in the past refused to provide support on account of Interest on GPF. The
Petitioner added that GoU is already bearing the terminal liability of the old employees
unlike other States. The Petitioner, further, requested the Commission that in case the
interest on GPF has to be borne by the State Government, the Commission should issue
suitable directions to GoU in this regard.
e) No interest on short-term funding through overdraft facility has been considered.
f) Interest on REC (Old) loans has been considered in accordance with the re-schedulement
package of REC (Old) loans determined by the Commission in its Tariff Order dated 23rd
October, 2009 for FY 2009-10.
g) Interest on consumer security deposit has been claimed as per the actual interest paid.
h) Provision for interest on PFC loans towards R-APDRP Part A and Part B has been excluded
as these loans shall be converted to grants after successful implementation of the works.
i) Other financial and bank charges have been considered after reducing the overdraft amount.
The Petitioner has again claimed interest on AREP loans which has not been allowed by the
Commission in its previous Tariff Orders for reasons given in the respective Orders. The Petitioner
has ignored the fact that the AREP loan were interest free loan and interest was payable in case of
default by the borrower and the costs associated with any default cannot be allowed to be pass
through in tariffs. Hence, the Commission again disallows the interest claimed on AREP loans. The
Commission has also not considered interest on R-APDRP loans in line with the approach adopted
by the Commission in the previous Tariff Order.

As discussed in preceding paras, the Commission has revised the funding of additional
capitalisation from FY 2012-13 onwards. The Commission has, accordingly, considered the revised
closing loans for FY 2015-16 as the opening loan for FY 2016-17.
Regulation 27 of the UERC Tariff Regulations, 2015 stipulates the methodology for
computation of interest expenses. The Commission in accordance with the above Regulation has
worked out the Interest and Finance Charges for FY 2016-17 considering the loan amounts
corresponding to the assets capitalised in the year based on the approved means of finance, and the
interest rate of 9.24% has been computed on the basis of weighted average interest rate on the actual
loan portfolio at the beginning of each year.
The Petitioner has again requested the Commission to allow interest on GPF as part of
interest expenses as the same is a statutory liability of the Petitioner. The Commission in the past
has not allowed such expenses for reasons given in the respective Orders. Hence, the Commission
again disallows the interest claimed on GPF.
The Petitioner has claimed interest liability on consumers’ security deposits (CSD) for FY
2016-17 as Rs. 42.89 Crore which has actually been paid. The Commission has approved the interest
on CSD for FY 2016-17 as Rs. 42.89 Crore.
Further, the interest on REC Old Loan has been allowed as claimed by UPCL. The
Commission observed that the Petitioner has claimed substantially higher guarantee fee of Rs. 11.31
Crore as compared to Rs. 3.42 Crore approved in the Tariff Order for FY 2016-17. The Commission,
accordingly, directed the Petitioner to submit the details of the guarantee fees paid. The Petitioner
in response submitted the breakup of guarantee fees claimed by it which is as shown in the Table
below:
Table 3.29: Guarantee Fee claimed by the Petitioner in FY

2016-17 (Rs. Crore)
Particulars Amount
Provision for Guarantee fees for FY 16-17 5.66
Provision for penalty due to non-payment of
5.65
Guarantee fees for FY 2016-17
Total 11.31
The Commission further sought details of how provisions of Rs. 5.66 Crore has been worked
out and details of guarantee fee booked in accounts and that actually paid to State Government

from FY 2011-12 to FY 2016-17. The Petitioner in its reply submitted the computation of provisions
of Rs. 5.66 Crore as shown in the Table below:
Table 3.30: Basis of computing provisions on account of Guarantee Fee (Rs. Crore)
Outstanding Loan Penalty Amount due to Guarantee
S. Guarantee
Loan Amount as on non-payment of Fees +
No. Fees
31.03.2017 Guarantee Fees Penalty
1. Old REC Loan 149.42 - - -
2. R-APDRP (Part A)-PFC 93.85 - - -
RAPDRP-PART A
3. 8.25 - - -
(SCADA)-PFC
4. RAPDRP-PART B –PFC 307.96 - - -
Total 559.48 5.66 5.65 11.31
The Petitioner further submitted that the Guarantee fees at the rate of 1% and penalty at the
rate of 1% on outstanding loan was wrongly calculated on Rs. 565.38 Crore instead of Rs. 559.48
Crore. Thus, guarantee fee was computed on extra Rs. 5.90 Crore (i.e. Rs. 565.38 Crore less Rs.
559.48 Crore) in FY 2016-17. The Petitioner in this regard submitted that it is already making efforts
in seeking the additional Rs. 5.90 Crore paid to PFC. Further, the entry of Guarantee fees along with
applicable penalty was earlier passed on the full amount, i.e. Rs. 565.38 Crore. The entry could not
be rectified in FY 2016-17 due to which there is an excess provision for Rs. 0.12 Crore in FY 2016-17.
The Petitioner submitted that the same shall be rectified in the current year, i.e. FY 2017-18.
The Commission has only considered the guarantee fee of Rs. 5.59 Crore due for FY 2016-17
and has not considered the excess provision made by UPCL as well as provisions made for payment
of penalty on non-payment of guarantee fee as the Commission has been allowing guarantee fee to
UPCL in its previous Tariff Orders. Further, the Commission has not reduced the amount of interest
capitalised as the Commission has considered the loans corresponding to the assets capitalised and
not the total loans as considered by the Petitioner.
The Commission has worked out the Interest and Finance Charges for FY 2016-17
considering the loan amounts corresponding to the assets capitalised in the year based on the
approved means of finance, as shown in the Table below:

Table 3.31: Interest and Finance Charges for FY 2016-17 (Rs. Crore)
Tariff Claimed by
Particulars Approved
Order UPCL
Interest on Loan corresponding to assets capitalised 79.83 73.04 51.98
REC Old Loan 22.26 22.26
Guarantee Fee & Financing Charges 3.40 11.31 5.59
Financing Charges 1.70 1.70
Interest on Security Deposit 52.56 42.89 42.89
Net Interest and Finance Charges 135.79 151.21 124.42
3.3.2.1.2 Depreciation
The Petitioner in its Petition has submitted that it has calculated depreciation considering
the opening and closing GFA for FY 2016-17 on an average basis. Further, the rate of depreciation
considered by it was as specified in UERC Tariff Regulations, 2015. The Petitioner has computed
depreciation at the rate of 5.21% for FY 2016-17. The Petitioner has, accordingly, claimed total
depreciation of Rs. 118.74 Crore as against Rs. 125.32 Crore approved by the Commission in the
Tariff Order for FY 2016-17.
The Commission has allowed depreciation at a weighted average rate of 5.21% based on the
audited balance sheet for FY 2016-17. Further, the Commission has been allowing depreciation on
the value of opening GFA keeping in line with the practice being followed by the Petitioner of
capitalising the asset in its accounts on the last day of the financial year. The Tariff Regulations of
the Commission provides for depreciation on pro-rata basis, however, the Petitioner in its accounts
calculates depreciation on the opening GFA as is evident from its Notes to Accounts. Therefore, the
Commission finds no justification to depart from the practice adopted in the previous Tariff Orders
of allowing depreciation on the opening balance of GFA. The Commission directs the Petitioner to
claim depreciation in line with its practice followed in the accounts.
The Commission in its data gaps sent to the Petitioner required it to confirm that the
depreciation claimed is not in excess of 90% of its assets. The Petitioner in its reply confirmed that
depreciation in FY 2016-17 has been less than 90% of GFA for all assets in accordance with the
UERC Tariff Regulations, 2015.
The depreciation approved by the Commission for FY 2016-17 is as shown in the Table
below:

Table 3.32: Depreciation approved for FY 2016-17 (Rs. Crore)

Particulars Tariff Order Claimed by UPCL Approved
Opening GFA 4153.35 - 3980.56
Grants 1748.06 - 1700.75
Depreciable opening GFA 2405.29 2279.81 2279.80
Net addition during the year 335.59 238.29 101.76*
Closing GFA 2740.88 4218.85 2381.56
Depreciation Rate 5.21% 5.21% 5.21%
Depreciation 125.32 118.74 118.86
*Additions less grants
3.3.3 Provisions for Bad and Doubtful Debts

The Petitioner in its Petition has submitted that the Commission in the MYT Order dated
April 05, 2016 did not allow any provisioning of bad debts for earlier years.
The Petitioner submitted that annual provision towards bad & doubtful debts is an accepted
method of accounting and considering the peculiarity of retail supply business, the same has also
been recognized by other SERCs. The Petitioner added that the amount, if any, written off towards
bad debts is only adjusted against the accumulated provisions in the books, irrespective of the
actual amount of bad debts during any particular financial year.
The Petitioner requested the Commission to allow provision for bad and doubtful debts on
actual basis after considering the geographical spread of the large consumer base across the State
including a large part of the same prevailing in the difficult terrain and hilly region and the problem
of realizing energy dues from retail consumers.
The Petitioner further submitted that in line with the approach followed by the Commission
in the previous Tariff Orders, the Petitioner has not included any amount on account of
provisioning of bad debts in the ARR but has calculated the same and has requested the
Commission for its approval.
The Petitioner further submitted that as per the directions of the Commission, the process of
writing off bad debts has already been initiated. The Petitioner in its Petition has requested the
Commission to approve Rs. 35.18 Crore which is the actual write off of bad debts in FY 2016-17.
Regulation 31 of the UERC Tariff Regulations, 2015 specifies as follows:

“(1) The Commission may allow a provision for bad and doubtful debts upto one percent (1%) of the
estimated annual revenue of the distribution licensee, subject to actual writing off of bad debts by it
"in the previous years.
Provided further that where the total amount of such provisioning allowed in previous years for bad
and doubtful debts exceeds five (5) per cent of the receivables at the beginning of the year, no such
appropriation shall be allowed which would have the effect of increasing the provisioning beyond the
said maximum.”
As regards the bad and doubtful debts, the Commission sought the following clarification
from UPCL:
 Nature of bad debt written off.
 Consumer Category wise bad debt written off
 Division wise bad debt written off and consumer category wise bad debt written off.
UPCL in response to the above queries has submitted that the bad debt pertains to write off
of fictitious arrears which were created due to wrong or excess billing and further submitted the
category wise and division wise details of the bad debts written off.
It is observed that the provision for bad and doubtful debts as on November 9, 2001 as per
the Transfer Scheme of Assets and Liabilities executed between UPPCL and UPCL was Rs. 230.01
Crore. The details of provision for bad debts allowed by the Commission and actual bad debts
written off by the Petitioner are as shown in the Table below:
Table 3.33: Provision for Bad and Doubtful Debts and Actual Write off (Rs. Crore)
Year Provision allowed by the Commission Actual written off
09.11.2001 230.01
FY 2001-02 3.86 -
FY 2002-03 10.03 -
FY 2003-04 10.94 -
FY 2004-05 11.03 -
FY 2005-06 12.44 -
FY 2006-07 13.87 -
FY 2007-08 17.59 -
FY 2008-09 23.98 -
FY 2009-10 - -
FY 2010-11 - -
FY 2011-12 - 10.96
FY 2012-13 - 44.04
FY 2013-14 - 47.01
FY 2014-15 - 37.14
FY 2015-16 - 56.11
FY 2016-17 - 35.18
Total 333.75 230.44

The Commission in its MYT Order dated April 05, 2016 with regard to writing off bad debt
had held as under:
“With respect to the amount written off by the Petitioner during FY 2011-12 and FY 2012-13, the
Petitioner in the previous proceedings had submitted that the wrong billing made in the earlier period
were corrected by the distribution divisions and the value of excess billing had been written off in FY
2011-12 and FY 2012-13. Since the write offs were basically the rectification of wrong billing and,
accordingly, the Commission had held that such corrections cannot be treated as writing off of bad
debts. This clearly indicates lack of proper policy framework for identification, recognition and
management of provision for bad and doubtful debt. Further, it is surprising that despite categorical
directions issued by the Commission in its previous Tariff Orders, to frame a transparent policy for
identifying, recognising and writing off the bad debts, the Petitioner in its reply has yet again
submitted that it is in the process to finalise the bad debts write off policy of the company. The
Petitioner is directed to finalise the Policy within three month from the date of Order
and submit the same for approval of the Commission.”
The Commission observed that the Petitioner is yet to finalise its bad debt write off policy as
per the above directions. The Commission directed the Petitioner to submit the current status
towards compliance of the said directions. The Petitioner in response in the current Petition has
submitted Bad Debt Policy which it intends to implement from FY 2018-19 onwards. The
Commission in this regard has discussed the same in Chapter 4 of this Order.
The Commission has already allowed the Petitioner a total provision of Rs. 333.75 Crore till
FY 2008-09 which also includes the opening balance of the provision inherited from UPPCL. Even
considering the actual write off debt of Rs. 230.44 Crore till FY 2016-17, the Petitioner is still left with
a provision of about Rs. 103.31 Crore. The closing debtors of UPCL as on 31.03.2016 were to the tune
of Rs. 1,789.05 Crore as per the Commercial Diary of UPCL. Hence, the provision available with
UPCL is to the extent of 5.77% for FY 2016-17 of the existing debtors and any additional provision is
not allowable in accordance with the Regulations as referred above. In this regard, UPCL is again
directed to refrain itself from treating rectification of wrong billing made in the earlier period as
writing off the bad debts.
3.3.4 Interest on Working Capital (IoWC)
The Petitioner has submitted that it has computed interest on working capital as per UERC

Tariff Regulations, 2015. However, as per the computation submitted by the Petitioner the net
working capital is submitted as Rs. -37.33 Crore. The Petitioner has submitted that it has not
claimed any IoWC. The Petitioner has submitted that the actual interest on working capital is nil as
the amount towards overdraft facility is primarily utilized for the purpose of availing the maximum
rebate from the generators. However, the Petitioner has requested the Commission to consider the
interest on overdraft against the rebate earned from generators as detailed under non-tariff income.
The computation of interest on working capital as submitted by the Petitioner is detailed in

the Table below:
Table 3.34: Interest on Working Capital for FY 2016-17 (Rs. Crore)

Particulars Amount
Operation and Maintenance Expenses (one month) 34.46
Maintenance Spares @ 15% of O&M Expenses 62.03
Receivables (2 months) 853.57
Capital required to finance such shortfall in collection of current dues 78.22
Sub-total 1028.28
Less: Adjustment for security deposits & Credit available for Power Purchase 1067.70
Net working capital -39.43
Interest on working capital 0.00
The Commission has computed the working capital requirement as per UERC Tariff
Regulations, 2015. Similar to the Petitioner’s submission, the net working capital as worked out
based on the approved expenses is negative, therefore, the Commission is not approving any IoWC
for FY 2016-17. In this regard, the Petitioner’s request to adjust it against the revenue towards rebate
earned cannot be accepted as the interest on overdraft facility and revenue earned through rebate
are two different elements. Further, as per the norms specified in the Regulations the Petitioner does
not require any working capital if it would have carried out its operations efficiently. The
requirement of overdraft arose as the Petitioner could not recover its dues from the consumers on
time. However, actual interest on overdraft facility availed, which is a working capital facility has
been considered as loss and sharing of the loss has been done in accordance with UERC MYT
Regulations, 2015.
The Petitioner submitted that it has computed Return on Equity (RoE) for FY 2016-17 based
on actual equity invested in the business. The Petitioner further submitted that it has calculated RoE
on the basis of the following.

 Revised opening equity has been considered for FY 2001-02 depending upon the
finalisation of transfer scheme.
 Revised closing equity for FY 2015-16 has been arrived upon in the following manner.
i. Opening equity balance as approved by the Commission for FY 2012-13 has been
considered.
ii. Year wise addition of equity as per the funding of each scheme has been
considered.
 The capitalisation for FY 2016-17 excluding the grants and deposit works has been
considered to be funded in the debt equity ratio of 70:30.
 Return on equity has been computed on the average equity at the rate of return of
16.50%.
The Petitioner has computed RoE on opening equity, however, it has requested the
Commission to allow RoE on the basis of average equity.
The Commission as already discussed has revised the funding of additional capitalisation
from FY 2012-13 onwards. The Commission in view of the same has considered the revised closing
equity for FY 2015-16 as the opening equity for FY 2016-17. With respect to UPCL’s request to allow
RoE on average equity, the Commission is not allowing the same for two reasons. Firstly, UPCL’s
policy of capitalisation of assets in its accounts is to capitalise the asset on the last day of the
Financial Year and hence, the asset cannot be expected to generate income till it is put to use and
capitalised in the accounts. Further, the Regulations allows RoE on the opening equity only.
Accordingly, the Commission has approved the Return on Equity at the rate of 16.50% on
the opening equity in accordance with the Regulations. The Return on Equity approved by the
Commission for FY 2016-17 is as shown in the Table below:
Table 3.35: Return on Equity approved by the Commission for FY

2016-17 (Rs. Crore)
Approved in the
Particulars Claimed by UPCL Approved
Tariff Order
Return on Equity 47.12 66.45 66.45
3.3.6 Non Tariff Income
The Petitioner submitted that the Non-Tariff Income includes income from non-tariff sources

such as income from investments, delayed payment surcharge, etc. The Petitioner, in its Petition,
has claimed non-tariff income as Rs. 354.32 Crore as against the actual Non-Tariff Income as per the
audited accounts of Rs. 434.56 Crore.
The Petitioner submitted that since UERC MYT Regulations, 2015 allows normative working
capital only, any additional rebate earned by the Petitioner by making early payment should be
allowed to be retained by the Petitioner. The Petitioner further submitted that it has been making
consistent and earnest efforts to avoid additional burden on the consumer by following the practice
of making timely payments of the power purchase invoices. Therefore, the Petitioner has requested
the Commission to approve the cost of overdraft facility availed by it by adjusting the same in the
total benefit availed from the rebate. Accordingly, the Petitioner has adjusted the rebate of Rs. 44.07
Crore with the interest on overdraft of Rs. 27.06 Crore made in FY 2016-17. The Commission does
not accept the contention put forward by the Petitioner. The Commission in the past has also
considered the total rebate earned by the Petitioner as non-tariff income. The Petitioner in the past
have pleaded to only pass on 1% of the rebate earned by it which was contrary to the Judgment
dated May 18, 2015 of Hon’ble APTEL in the appeal filed by the Petitioner and, therefore, was not
allowed by the Commission. In the current Petition, the Petitioner intends to adjust the cost of
overdraft facility which it uses to manage its working capital requirement inherent to the operations
of its business and the same cannot be passed on to the consumer as the Commission has been
separately allowing IoWC as per the prevalent Regulations and for reasons discussed in Section
3.3.4 above, the Petitioner intends to seek additional expenses over and above IoWC allowed by the
Commission under the guise of cost towards maintaining overdraft facility which is not as per the
UERC Tariff Regulations, 2015. Therefore, the same has not been considered by the Commission.
The Petitioner with regard to material cost variance submitted that out of the total Rs. 37.53
Crore, contribution from grants (Rs. 10.66 Crore) has been deducted from the overall claim in line
with the methodology adopted by the Commission in the Tariff Order dated March 29, 2017.
The Petitioner further submitted that it has adjusted the prior period income/expense of Rs.
54.90 Crore for non-allowable prior period income /expenses and has considered income and
expenses towards power purchase liabilities written back, prior period expenses and assessment of
prior period income as per audited accounts for consideration in non-tariff income.
The Commission agrees with the submissions made by the Petitioner in this regard as the

Commission also had not allowed the material cost variance on the value of grants and also with
the submissions made with regard to adjustment of prior period income and expenses.
Accordingly, the non-tariff income claimed by the Petitioner and that approved by the
Commission for the purpose of truing up for FY 2016-17 is as given in the Table below:
Table 3.36: Non-tariff Income approved by the Commission for FY

2016-17 (Rs. Crore)
Approved in Claimed
the Tariff Order by UPCL
Interest on deposits 57.09 57.09
Income from staff welfare
0.16 0.16
activities
Rebate/Incentive 17.01 44.07
Miscellaneous receipts 22.37 22.37
Material Cost Variance 178.60 26.86 26.86
Delayed Payment Surcharge 183.92 183.92
Sale of Surplus Power 17.20 17.20
Wheeling Charge, Cross Subsidy
Surcharge and Additional 17.32 17.32
Surcharge
Prior Period Income 12.38 12.38
Total 178.60 354.32 381.38
3.4 Tariff Revenue
The Petitioner submitted the revenue at existing tariff as Rs. 4791.11 Crore as against the
revenue of Rs. 5253.82 Crore approved by the Commission in the Tariff Order for FY 2016-17.
However, on totalling the category wise revenue, the total revenue worked out to Rs. 4791.15 Crore
against Rs. 4791.11 Crore submitted by UPCL.
The Petitioner submitted that the Commission in its MYT Order dated April 05, 2016 had
approved distribution loss of 15.00%. The Petitioner further submitted that while approving the
distribution loss, the Commission had reiterated the need for conducting an independent energy
audit study. In addition, clause 79(4) of the UERC Tariff Regulations, 2015 also states that the
Commission may require the Distribution Licensee to conduct proper and reliable energy audit to
substantiate distribution loss calculations. The Petitioner submitted that in pursuance of
Commission’s directive, the Petitioner appointed a consultant for independent verification of billing
parameters (input energy, energy billed, billed amount and collected amount) and for deriving the
billing efficiency, collection efficiency and AT&C losses of UPCL for FY 2015-16. As per the report

submitted by the consultant the actual distribution losses are 18.33% for FY 2015-16 which was
broadly in line with the claim of the Petitioner. The Petitioner further submitted that the actual
distribution loss for FY 2015-16 were substantially higher than the baseline value of 15.00%
considered by the Commission for FY 2015-16 and subsequent years resulting in non-achievement
of target distribution loss by the Petitioner for FY 2016-17 in spite of the improvement to 16.68%
over the past year actual loss level of 18.33%. The Petitioner further submitted that it is able to
achieve the loss reduction in spite of operating in a difficult geographical terrain where very small
load clusters are distributed over a larger area resulting in higher distribution losses. Also, with the
implementation of Central Government schemes like RGGVY and DDUGJY where the Petitioner is
required to connect rural population spread across the state, it is difficult to maintain the same loss
level. In view of the above challenges, which also result in counterbalancing the initiatives
undertaken by the Petitioner for loss reduction and findings of an independent energy audit, the
Petitioner requested that the Commission may re-determine the targets for the Second Control
Period based on the actual base year values of 18.33% in FY 2015-16. For FY 2016-17, the Petitioner
has achieved distribution loss of 16.68% which it has requested the Commission to approve as loss
target for FY 2016-17 and further, reduce the trajectory in line with the target approved for FY 2013-
14 onwards.
The Petitioner further submitted that the Commission in its previous Tariff Orders has also
been computing additional deemed revenue earned by the utility for non-achievement of loss
targets as adjustment in the revenue gap based on the gain/ loss sharing mechanism. This has led to
huge revenue loss for the Petitioner in the past years even after having achieved year-on-year
reduction in distribution loss. The Petitioner further requested not to consider any additional
revenue on account of not meeting the norms and revisit and adjust the revenue that have been
considered in the past.
The Commission has considered the distribution loss for FY 2016-17 as approved by it in its
MYT Order and, accordingly, has computed the loss of sales as 266.20 MU due to commercial
inefficiencies of UPCL. It is observed that despite huge capitalisation carried out by the Petitioner,
its losses at LT levels are not reducing. Further, no concrete steps have been carried out by the
Petitioner to reduce its losses. The meter exceptions of the Petitioner though have reduced but are
still on a higher side. This issue has also been settled by Hon’ble ATE in its Judgment dated May 18,
2015 on the Appeal filed by the Petitioner. The relevant extracts of the Judgment are reproduced
hereunder:
“...It is clear from the submissions made by State Commission that the Appellant has not
been taking action on the directions given by the State Commission on defective meter and meter
not read which remained above 20% of total consumers more than five years in each billing cycle.
The State Commission UPCL has not taken action for energy audit. We do not find any infirmity
in fixing up of loss reduction targets by the State Commission. The Appellant has not given
any instances where funds for capital works for strengthening of distribution system have been
denied by the State Commission in ARR...”
Thus, the Commission finds no reason to revisit the loss reduction trajectory fixed by it.
While approving the category wise sales for FY 2016-17, the Commission has recasted the
sales of Domestic, Private Tubewells and Public Lamps from the sales submitted by the Petitioner.
Since, the sale has been reduced, the Commission has, accordingly, adjusted the revenue
corresponding to the assessed sales from the total revenue submitted by the Petitioner based on the
re-casted ABR of that category which has been worked out based on the actual revenue and re-
casted sales. With regards the revenue from departmental employees, both in service and retired, it
is observed that based on the re-casted sales for departmental employees, the ABR of UPCL’s
departmental employees is less than the average ABR of other domestic consumers, while the ABR
of UJVN Ltd. and PTCUL’s employees is exceeding the average billing rate of other domestic
consumers and, accordingly, adjustment on this account has been carried out towards the revenue
for FY 2016-17 based on the ABR of other domestic consumers.
The revenue corresponding to the assessed sale is shown in the Table below:
Table 3.37: Revenue for FY 2016-17 Corresponding to Assessed Sales

Actual Actual Revenue
Actual
Recasted ABR on ABR of Corresponding
Revenue
Particulars Sales recasted the to re-casted
(Rs.
(MU) sales category sales (Rs. Crore)
Crore)
(Rs./kWh) (Rs./kWh)
UPCL Employees and Pensioners 22.39 3.38 1.51 3.37 4.16
PTCUL Employees and Pensioners 1.22 1.78 14.54 3.37 (1.37)
UJVNL Employees and Pensioners 2.12 0.78 3.67 3.37 (0.06)
Public Lamps 47.34 23.28 4.92 4.92 (0.01)
Total 2.72
It is imperative to mention that the impact of concessional/subsidised electricity provided

by UPCL to its employees works out to about Rs. 11.99 Crore (20.30 MU excess consumption
disallowed or loss of sales and considered as loss @ ABR of Rs. 4.56 per unit which yields a revenue
of Rs. 9.26 Crore and additional revenue of about Rs. 2.72 Crore due to lower ABR than that of other
domestic consumers). The Corporation will have to bear this impact as the average consumption of
the employees is much higher than the consumption of other domestic consumers and, moreover,
the charges which are recovered from the employees towards the use of electricity is not
commensurate with the price charged from other domestic consumers. Hence, the same cannot be
allowed to be passed on to the consumers in the State and the Corporation will have to bear this
burden.
Based on the above, the revenue from the sale of power, as worked out by the Commission
is shown in the Table below:
Table 3.38: Revenue from Sale of Power for FY 2016-17 (Rs. Crore)
Particulars Amount
Actual Revenue 4791.15
Add: Revenue corresponding to recasted Sales 2.72
Total Revenue 4793.87
The Commission for the computation of ABR has considered the revenue of Rs. 4793.87
Crore.
Further, as discussed above there is a loss of 266.20 MU on account of commercial

inefficiencies of the Petitioner failing to achieve target distribution loss approved by the
Commission. The Commission has considered the revenue of Rs. 121.31 Crore at an average billing
rate of Rs. 4.56 kWh for this additional loss of sale on account of higher distribution losses while
truing up the ARR for FY 2016-17 as shown in the Table below:
Table 3.39: Additional Revenue from Sale due to inefficiency for FY 2016-17 (Rs. Crore)
Sr. No. Particulars Claimed by UPCL Approved
1. Actual/ Re-casted Sales (MU) 10518.99
2. Approved Distribution Loss Level (%) 15.00%
3. Actual Energy Input at T-D Interface (MU) 12688.46
4. Sales at Actual Energy Input with 15.00% Loss (MU) 10785.19
5. Loss of Sales due to Inefficiency (MU) 266.20
NIL
6. Revenue at existing Tariff (Rs. Crore) 4793.87
7. ABR (Rs./kWh) 4.56
Additional Revenue due to higher distribution losses (Rs.
8. 121.31
Crore)
9. Losses to borne by Petitioner Rs Crore) (2/3rdof (8)) 80.88

Accordingly, the Commission has considered tariff revenue of Rs. 4874.75 Crore including
Rs. 80.88 Crore as deemed revenue on account of excess loss for FY 2016-17 as against total revenue
of Rs. 4791.11 Crore claimed by the Petitioner.
3.5 Sharing of Gains and Losses
The Petitioner submitted that it has achieved better performance against the targets specified
on the performance parameters, i.e. employee expenses and A&G expenses.
The sharing of gains and losses claimed by the Petitioner for FY 2016-17 is as shown in the
Table below:
Table 3.40: Sharing of Gains and Losses for FY 2016-17 claimed by the
UPCL
Particulars Amount Consumer Share
Share
A. Gain 1/3rd 2/3rd
Employee Expenses 23.17 7.72 15.45
A&G Expenses 6.77 2.26 4.51
R&M Expenses (0.07) (0.07) (0.14)
(Loss)/ profit Share 9.91 19.82
Regulation 12 of the UERC Tariff Regulations, 2015 specifies as under:
“12. Annual Performance Review
(5) The “uncontrollable factors” shall include such of the factors which are beyond the control of,
the applicant, as determined by the Commission. Some examples of uncontrollable factors are as
follows:
c) Economy wide influences such as unforeseen changes in inflation rate, market interest rates,
taxes and statutory levies;
(6) Some illustrative variations or expected variations in the performance of the applicant which
may be attributed by the Commission to controllable factors shall include, but shall not be limited
to, the following:

f) Variations in working capital requirements;
j) Variation in operation & maintenance expenses
(10) Upon completion of the Annual Performance Review, the Commission shall pass on an order
recording-
a) The approved aggregate gain or loss to the Applicant on account of uncontrollable factors and
the mechanism by which the Applicant shall be allowed such gains or losses in accordance with
Regulation 13;
b) The approved aggregate gain or loss to the Applicant on account of controllable factors and
sharing of such gains or such losses that may be shared in accordance with Regulation 14;
c) The approved modifications to the forecast of the Applicant for the ensuing year, if any;
The surplus/deficit determined by the Commission in accordance with these Regulations on

account of truing up of the ARR of the Applicant shall be carried forward to the ensuing financial
year.”
“13. Sharing of Gains and Losses on account of Uncontrollable factors
(1) The approved aggregate gain or loss to the Applicant on account of uncontrollable factors shall be
allowed as an adjustment in the tariff/charges of the Applicant over such period as may be
specified in the Order of the Commission;
…”
“14. Sharing of Gains and Losses on account of Controllable factors
(1) The approved aggregate gain and loss to the Applicant on account of controllable factors shall
be dealt with in the following manner:

a) 1/3rdof such gain shall be passed on as a rebate or allowed to be recovered in tariff over such
period as may be specified in the Order of the Commission;
b) The balance amount of gain may be utilized or absorbed by the Applicant.”
Hence, in accordance with UERC Tariff Regulations, 2015, the O&M expenses, IoWC and
Distribution losses are controllable factors and any gain or loss on account of the controllable factors
is to be dealt in accordance with the provisions of Regulation 14 of the above mentioned
Regulations.
The Petitioner with regard to interest on working capital has submitted that IoWC as per
accounts and actually incurred are zero and, therefore, no sharing of the same has been claimed.
The Commission, however, observes that the Petitioner has incurred cost of Rs. 27.06 Crore towards
interest on overdraft facility for working capital management. The Commission has, therefore,
carried out sharing of IoWC.
The sharing of gains on account of controllable factors approved by the Commission for FY
2016-17 is as shown in the Table given below:
Table 3.41: Sharing of Gains on Account of Controllable Factors approved by the

Commission for FY 2016-17 (Rs. Crore)
Normative as Aggregate Consumer’s Petitioner’s Share
Actual
Trued up gain/(loss) Share of Gain/(Loss)
Particulars
Gain: D=1/3 x C
A B C=B-A E=C-D
Loss D=1/3 x C
O&M expenses 401.20* 413.55* 12.35 4.12 8.23
Distribution Loss 17.10% 15.00% (121.31) (40.43) (80.88)
IoWC 27.06 0.00 (27.06) (9.02) (18.04)
Total (-136.02) (45.33) (90.69)
* Excluding provisions towards date centre costs and costs paid to Que Next of Rs. 6.40 Crore.
The trued O&M Expenses is as shown below:
Table 3.42: O&M Expenses as Trued up by the Commission for FY 2016-17 (Rs. Crore)
Actual O&M Petitioner’s Share of A&G Trued up O&M
Particulars
Expense Gain/(Loss) Provision Expense
O&M
401.20 8.23 6.40 415.83
Expenses

3.6 ARR and Revenue for FY 2016-17
The Commission in its Tariff Order dated April 06, 2016 had approved the Net Revenue
Requirement for FY 2016-17 as Rs. 5252.87 Crore. The Petitioner has now claimed an ARR of Rs.
5111.49 Crore for FY 2016-17. However, based on the various elements of the ARR as discussed
above and approved by the Commission, the summary of final Truing up for FY 2016-17 is given in
the Table below:
Table 3.43: Summary of true up for FY 2016-17 approved by the Commission (Rs. Crore)
Approved in
S. Claimed by
Particulars Tariff Order Approved
No. UPCL
dated 05.04.2016
1. Total Power Purchase Cost 4822.14 4971.03 4866.15
2. Interest on Loan & Financing Charges 135.79 151.21 124.42
3. Depreciation 125.32 118.74 118.86
O&M expenses after sharing of gains and
4. 574.73 427.41 415.83
losses
5. Interest on Working Capital 23.48 0.00 0.00
6. Impact of IoWC sharing - - 9.02
7. Return on Equity 47.12 94.51 66.45
8. Impact of Previous Year Funding adj. 7.08
9. Aggregate Revenue Requirement 5,728.58 5,762.91 5,607.81
10. Less: Non-Tariff Income 178.60 354.32 381.38
11. Gap/(Surplus) of previous year (175.10) (175.10) (175.10)
12. Past Year’s Adjustments (122.01) (122.01) (122.01)
13. Net ARR 5,252.87 5,111.49 4,929.32
14. Revenue
15. Revenue at Existing Tariff 5,253.82 4,791.11 4,793.87
16. Revenue from Addl. Sales. (after sharing) - - 80.88
17. Total Revenue 5,003.31 4,791.11 4,874.75
18. Adjusted Revenue (Surplus)/Gap (0.95) 320.38 54.57
The Petitioner in its Petition had requested the Commission to approve the gap of Rs. 320.38
Crore. However, the Commission has approved a gap of Rs. 54.57 Crore for FY 2016-17. The gap for
FY 2016-17 with carrying cost works out to Rs. 64.78 Crore which has been considered by the
Commission in the ARR of FY 2018-19.

4. Petitioner’s Submissions, Commission’s Analysis, Scrutiny
and Conclusion on Annual Revenue Requirement for FY
2018-19
4.1 Background
With regard to the MYT Framework and determination of ARR, UERC Tariff Regulations,
2015 specifies as follows:
“4. Multi-year Framework

The Multiyear tariff framework shall be based on the following:-
a) Business plan submitted by the applicant for the entire control period for the approval of
the Commission prior to the beginning of the control period;
b) Applicant’s forecast of expected ARR for each year of the control period, based on
reasonable assumptions and financial & operational principles/parameters laid down under
these Regulations submitted alongwith the MYT petition for determination of Aggregate
Revenue Requirement and Tariffs for first year of the control period;
c) Review of control period ending on 31.03.2016 shall also be taken up alongwith the
ARR/Tariff petition for the first year of ensuing control period.
d) Trajectory for specific parameters as may be stipulated by the Commission based on
submissions made by the Licensee, actual performance data of the Applicants and
performance achieved by similarly placed utilities;
e) Annual review of performance shall be conducted vis-à-vis the approved forecast and
categorization of variations in performance into controllable factors and uncontrollable
factors;
f) Sharing of excess profit or loss due to controllable and uncontrollable factors as per
provisions of these Regulations.
…
7. Determination of Baseline
The baseline values (operating and cost parameters) for the base year of the control period
shall be determined by the Commission and shall be based on the approved values by the
Commission, the latest audited accounts, estimates for the relevant year, prudence check and
4. Petitioner’s Submissions, Commission’s Analysis, Scrutiny and Conclusion on Annual Revenue Requirement for FY
2018-19
other factors considered by the Commission. The Commission may re-determine the baseline
values for the base year based on the actual audited accounts of the base year.”
In accordance with the above provisions of the Regulations, the Commission had approved
the Aggregate Revenue Requirement of the Petitioner for all the years of the second Control Period,
i.e. from FY 2016-17 to FY 2018-19 excluding the power purchase cost for FY 2017-18 and FY 2018-19
vide its MYT Order dated April 05, 2016.
As regards the Annual Performance Review, Regulations 12(3) of the UERC (Terms and
Conditions for Determination of Tariff) Regulations, 2015 specifies as follows:
“The scope of the Annual Performance Review shall be a comparison of the actual performance of the
Applicant with the approved forecast of Aggregate Revenue Requirement and expected revenue from
tariff and charges and shall comprise of following:
a) A comparison of the audited performance of the applicant for the previous financial year with the
approved forecast for such previous financial year and truing up of expenses and revenue subject to
prudence check including pass through of impact of uncontrollable factors;
b) Categorisation of variations in performance with reference to approved forecast into factors within
the control of the applicant (controllable factors) and those caused by factors beyond the control of the
applicant (un-controllable factors).
c) Revision of estimates for the ensuing financial year, if required, based on audited financial results
for the previous financial year;
d) Computation of the sharing of gains and losses on account of controllable factors for the previous
year.”
In terms of above, the Commission issued APR Order for FY 2016-17 and determined ARR
and Retail Tariff for FY 2017-18. The Petitioner in the present APR Petition has requested the
Commission to approve the revised estimates for FY 2018-19 based on the truing up of actuals for
FY 2016-17 and revised submissions in the APR Petition. The Commission had already approved
most of the ARR components for the Control Period FY 2016-17 to FY 2018-19 after detailed
analysis, scrutiny and prudence check of the Petitioner’s submission vide its MYT Order dated
April 05, 2016 and APR Order dated March 29, 2017. As the Commission had not approved the
power purchase cost for FY 2018-19 in its MYT Order dated April 05, 2016, hence, in the present
Order the Commission has approved the power purchase quantum and cost associated therewith
based on the analysis and scrutiny of Petitioner’s projections in the Petition and considering the

actual expenses allowed for FY 2016-17 in this Order. As discussed in the previous Chapter, the
Commission in this Order has carried out the Truing up for FY 2016-17 in accordance with the
UERC Tariff Regulations, 2015 wherein the Commission has allowed capitalisation of assets for FY
2016-17 and has revised the funding of additional capitalization from FY 2012-13 to FY 2015-16. In
accordance with Regulation 12(3) of the UERC Tariff Regulations, 2015 the scope of annual
performance review is limited to the revision of estimates for the ensuing year, if required, based on
the audited financial results for the previous year and give resultant effect on this account in the
estimates of the said current year.
4.2 Sales
The Petitioner in its Petition submitted that in the MYT Order dated April 5, 2016, the
Commission had undertaken a detailed review of the sales, connected load and number of
consumers for the Control Period of FY 2016-17 to FY 2018-19. The Petitioner submitted that the
actual sales for FY 2016-17 has been 10,572 MU which is lower than the approved sales of 11,188
MUs by 616 MU. The Petitioner further submitted that in view of the actual sales available for FY
2016-17 and four months of FY 2017-18, it has proposed revision in sales for FY 2018-19 as per
Regulations 12(3)(c) of the UERC Tariff Regulations, 2015. The Petitioner also submitted that based
on the approved sales by the Commission, it is evident that the State energy consumption has
witnessed 5.51% Compounded Annual Growth Rate (CAGR) over the past five years, i.e. from FY
2011-12 to FY 2016-17 as shown in the Table below:
Table 4.1: Actual Energy sales for consumer categories during FY 2011-12 to FY 2016-17
(MU)
Consumer Category 2011-12 2012-13 2013-14 2014-15 2015-16 2016-17
RTS-1: Domestic 1572.37 1734.72 1998 2245.37 2342.26 2486.16
RTS-2: Non-Domestic 885.42 953.94 994 1067.73 1120.71 1178.02
RTS-3: Public Lamps 66.89 69.83 39 42.86 42.98 48.40
RTS-4: Private Tube-wells/Pumping sets 135.54 180.09 201 266.86 283.06 350.77
RTS-5: Government Irrigation System 136.56 130.2 104 107.62 140.9 145.08
RTS-6: Public Water Works 324.52 302.68 281 315.93 346.61 358.04
RTS-7: LT & HT Industry 4795.77 4789.76 5093 5371.25 5719.47 5808.17
Total LT - - 288.09 304.76 282.2 300.13
Total HT - - 4804.91 5066.49 5437.27 5508.03
RTS-8: Mixed Load 160.26 167.55 178 185.68 186.78 178.11
RTS-9: Railway Traction 8.39 7.83 11 14.7 14.16 19.23
Total 8085.72 8336.60 8899.00 9618.00 10196.93 10571.98

2018-19
The Petitioner submitted that growth in sales during FY 2016-17 has been lower, however,
the data for first four months of FY 2017-18 for energy sales shows an increase in the current year as
compared with the four month sales of FY 2016-17. Therefore, for the purpose of projecting the sales
for FY 2018-19, the Petitioner submitted that it has considered a mix of long to medium term trend
in energy consumption along with any recent trend having an impact on future consumption across
the consumer categories.
The Petitioner further submitted that for FY 2016-17, the Petitioner has been able to reduce
the load shedding to less than 1% of the actual energy requirement. Therefore, the sales during FY
2016-17 can be considered equivalent to unrestricted sales and has, therefore, been used for the
purpose of projection of sales for FY 2018-19. The Petitioner further submitted that it has considered
the Adjusted Trend Analysis Method in line with the approach followed by the Commission in the
MYT Order dated April 05, 2016.
Projection of Energy Sales – Adjusted Trend Analysis (CAGR) Method
The Petitioner submitted that for projecting the category-wise energy sales, it has considered
past growth trends in each consumer category, as explained below:
a) The Petitioner has adopted an Adjusted Trend Analysis Method for projecting the
sales for all consumer categories. The Petitioner submitted that this method assumes
that the underlying factors which drive the demand for electricity are expected to
follow the same trend as in the past, however, this approach also discounts any out-
lier (relative to the trend) observed in the growth rates over the period of 5 years and
excludes them while projecting energy sales for FY 2018-19.
b) The Petitioner submitted that this method makes use of a statistical tool, namely the
Compound Annual Growth Rate (CAGR) and, accordingly, Compounded Annual
Growth Rates (CAGRs) were calculated from the past figures for each category,
corresponding to different lengths of time in the past five years, along with the year
on year growth rates from FY 2011-12 to FY 2016-17 and growth during first four
months of FY 2017-18 with respect to the corresponding months in FY 2016-17 and
after considering the seasonality effect on consumption while selecting the growth
rate.
c) CAGR has been computed for each consumer category for the past 5-year period
from FY 2011-12 to FY 2016-17, the 4-year period from FY 2012-13 to FY 2016-17, the
3-year period from FY 2013-14 to FY 2016-17, and the 2-year period from FY 2014-15
to FY 2016-17, along with the 1-year growth rate of FY 2016-17 over FY 2015-16, as
summarised in the Table below:
Table 4.2: CAGR calculated for Energy Sales to each consumer category
S. 4 Month
Consumer Category 5 year 4 year 3 year 2 year 1 year
No. FY 2018
1. RTS-1: Domestic 9.60% 9.41% 7.56% 5.23% 6.14% 7.93%
2. RTS-2: Non-Domestic 5.88% 5.42% 5.83% 5.04% 5.11% 3.93%
3. RTS-3: Public Lamps -6.27% -8.76% 7.47% 6.27% 12.62% 12.30%
RTS-4: Private Tube-wells/
4. 20.88% 18.06% 20.29% 14.50% 23.59% -4.47%
Pumping sets
RTS-5: Government Irrigation
5. 1.22% 2.74% 11.74% 16.11% 2.97% 21.17%
System
6. RTS-6: Public Water Works 1.99% 4.29% 8.41% 6.46% 3.30% 3.14%
7. RTS-7: LT & HT Industry 3.90% 4.94% 4.48% 3.99% 1.55% 4.71%
8. Total LT - - 1.37% -0.76% 6.36% 3.13%
9. Total HT - - 4.66% 4.27% 1.30% 4.79%
10. RTS-8: Mixed Load 2.13% 1.54% 0.02% -2.06% -4.64% 0.41%
11. RTS-9: Railway Traction 18.04% 25.18% 20.46% 14.37% 35.80% 56.36%
Total 5.51% 6.12% 5.91% 4.84% 3.68% 5.45%
The Petitioner further submitted the methodology adopted for projecting the category wise
sales for FY 2018-19 as stated below:
(i) RTS-1: Domestic: Considering the increase in growth during first four months of FY
2017-18 and expected increase in domestic consumers due to implementation of
DDUGJY scheme, the Petitioner has considered the CAGR of five years, i.e. 9.60% for
projecting the sales for this category for FY 2017-18 and FY 2018-19.
(ii) RTS-2: Non-Domestic: Since the sales growth in this category has been range bound
(5-6%) as per the CAGR computed for various time intervals. Therefore, the Petitioner
has considered the 3 year CAGR of 5.8% for projecting sales for this category for FY
2017-18 and FY 2018-19.
(iii) RTS-3: Public Lamps: The sale for this category has been projected by the Petitioner
based on 3 year CAGR, i.e. 7.5%.
(iv) RTS 4: Private Tube Wells/Pumpsets (including RTS-4A): The Petitioner has
projected sales for this category based on the growth rate of 7% in FY 2017-18 and 8%
in FY 2018-19 owing to the increasing sales in the RTS-4A sub-category.

2018-19
(v) RTS-5: Government Irrigation System: The Petitioner submitted that no specific
pattern has been observed in the sales. The Petitioner submitted that in view of the
consistently increasing load, the Petitioner has considered a growth rate of 10% and
7% for FY 2017-18 and FY 2018-19 respectively which is also supported by the increase
in sales during the first four months of FY 2017-18.
(vi) RTS-6: Public Water Works: The Petitioner submitted that the load in this category
has increased by 9% during FY 2016-17 and 4% during first four months of FY 2017-18.
Therefore, the Petitioner has projected the sales for this category for FY 2017-18 and FY
2018-19 based on 7% growth rate each year considering the growth in FY 2016-17 to be
non-reflective of the medium term growth of sales in this category.
(vii) RTS-7: LT & HT Industries: Sales to LT Industries have been projected based on the
Y-o-Y increase in sales in FY 2016-17 and for HT Industries, the Petitioner submitted
that the growth in sales during FY 2016-17 was 1.3% as compared with the 2-3 year
growth of 4.3%-4.7%. Also, for the four months of FY 2017-18, the average increase
over past four months is 4.8%. Accordingly, the Petitioner has considered a growth
rate of 4.5% for projecting the sales in this category for FY 2017-18 and FY 2018-19.
(viii) RTS-8: Mixed Load: The Petitioner has projected sales for this category at a growth
rate of 2% for FY 2017-18 and FY 2018-19.
(ix) RTS-9: Railway Traction: The Petitioner submitted that based on increase in month-
wise sales in first four months of FY 2017-18 mainly due to significant load
enhancement by railways during FY 2016-17 and first four months of FY 2017-18, a
growth of 10% has been considered for FY 2018-19 in view of the full year impact of
the advanced load of the railways.
The Petitioner has considered the base year as FY 2016-17 for projecting the sales for FY
2018-19. The Petitioner has, accordingly, projected the energy sales for FY 2018-19 as shown in the
Table below:

Table 4.3: Sales projected by the Petitioner for FY 2018-19 (MU)

FY 2016-17
S. No. Category Wise Sales Growth Rate Method Adopted FY 2018-19
(Re-Casted)
1. RTS-1: Domestic 2486.16 9.60% 5 year CAGR 2,986.20
2. RTS-2: Non-Domestic 1178.02 5.80% 3 year CAGR 1,319.26
3. RTS-3: Public Lamps 48.40 7.50% 3 year CAGR 55.90
RTS-4: Private Tube-wells / 7.00% (FY 2017-18)
4. 350.77 Subjective Rate 405.59
Pumping sets 8.00% (FY 2018-19)
RTS-5: Government Irrigation 10.00% (FY 2017-18)
5. 145.08 Subjective Rate 170.76
System 7.00%(FY 2018-19)
6. RTS-6: Public Water Works 358.04 7.00% Subjective Rate 409.92
7. RTS-7: LT & HT Industry 5808.17 6,366.04
10.00% (FY 2017-18)
Total LT 300.13 Subjective Rate 351.13
6.40% (FY 2018-19)
Total HT 5508.03 4.50% Subjective Rate 6,014.91
8. RTS-8: Mixed Load 178.11 2.00% 5 year CAGR 185.31
9. RTS-9: Railway Traction 19.23 10.00% Subjective Rate 31.41
Total 10571.98 11,930.38
The Commission observed that though the Petitioner has submitted that it is projecting
unrestricted sales, however, the Petitioner has projected restricted sales instead of unrestricted sales.
The Commission has gone through the submissions of the Petitioner. The Commission observes that
the sales of 11930 MU projected by the Petitioner is less than 12555 MU projected by the
Commission in MYT Order for FY 2018-19 primarily due to reduction in the growth rate especially
in the Domestic and Industrial categories.
As discussed in Chapter 3, the Commission has carried out the truing up of sales for FY
2016-17. Considering the actual re-casted sales as trued up sales in Chapter 3, the Commission has
re-worked the sales of FY 2018-19 as discussed below.
(i) Base year has been considered as FY 2016-17 as the actual sales data are available. The
Commission has considered the re-casted sales for FY 2016-17 and has added the
category wise load shedding carried out during FY 2016-17 as submitted by the
Petitioner to derive the un-restricted sales for FY 2016-17.
(ii) The Commission has applied the same growth rate as considered in the business plan for
PTW, GIS, PWW and LT Industry.
(iii) With regard to the Domestic and Non-Domestic Categories the Commission has
considered 5 Year CAGR.
(iv) For Public Lamps 3 Year CAGR has been considered.

2018-19
(v) For the remaining categories the Commission has considered the growth rates as
projected by the Petitioner taking into cognisance demand trend in the first four months
of FY 2017-18.
On the basis of the above, the total sales works out to 11854 MU which is lower than the
sales of 12555 MU approved in the MYT Order dated 05.04.2016 by 701 MU. The Commission
observes that there is a considerable difference in the sales approved in the MYT Order and that
projected on the basis of re-casted sales of FY 2016-17. The Commission has, therefore, revised the
sales considering the revised growth rates as discussed above for FY 2018-19 and the same is as
shown below:
Table 4.4: Consumer Category wise sales approved by the Commission for FY
2018-19 (MU)
S.No. Category Claimed Approved
1. Domestic 2,986.20 2950.13
2. Non Domestic 1,319.26 1319.74
3. Public Lamps 55.90 52.63
4. Private Tube Wells (PTW) 405.59 368.60
5. Government Irrigation System (GIS) 170.76 161.23
6. Public Water Works (PWW) 409.92 398.41
7. Industrial Consumers
LT Industries 351.13 329.92
HT Industries 6,014.91 6062.82
Total 6,366.04 6392.74
8. Mixed Load 185.31 186.78
9. Railway Traction 31.41 23.45
GRAND TOTAL 11,930.38 11853.72
4.3 Distribution Loss Trajectory
The Commission had approved the Distribution Loss Trajectory for the second Control
Period from FY 2016-17 to FY 2018-19 in its MYT Order dated 05.04.2016. The distribution loss
trajectory approved by the Commission for the second Control Period from FY 2016-17 to FY 2018-
19 is as shown in the Table given below:
Table 4.5: Distribution Loss Trajectory approved by the Commission for the second
Control Period from FY 2016-17 to FY 2018-19
Particulars FY 2016-17 FY 2017-18 FY 2018-19
Distribution Losses 15.00% 14.75% 14.50%
The Petitioner in its Petition has submitted that the distribution loss level achieved by the
Petitioner in FY 2016-17 was 16.68%. The Petitioner further submitted that the Commission while

determining the ARR and Tariffs of UPCL has considered the deemed revenue due to non-
achievement of unrealistic trajectory of distribution losses determined by the Commission. The
Petitioner submitted that despite several efforts to reduce the distribution losses and significant
improvement in FY 2016-17, it has been challenging for the Petitioner to bring the losses at par with
the targets set by the Commission. The Petitioner also submitted that below 20% distribution loss
level, reduction of distribution losses is extremely difficult and slows down considerably. The
Petitioner further submitted that inspite of a significant reduction of distribution loss by 1.71%
during FY 2016-17, the Petitioner would have to bear a huge financial loss in each year of the
Control Period in case the loss trajectory is not re-determined based on the actual loss for FY 2015-
16 (base year).
The Petitioner also submitted that the following initiatives have been taken for loss
reduction.
a) Implementation of R-APDRP Part A scheme
b) Implementation of R-APDRP Part B scheme
c) Installation of Double metering in selected 11 kV & 33 kV consumers
d) Implementation of AMR
e) Replacement of Mechanical Meters with Electronic Meters and Installation of

Electronic meters in un-metered connections
f) Laying of LT ABC
g) Replacement of defective meters
h) Procurement of High value consumer management system (HVCMS)
The Petitioner has, accordingly, proposed the following distribution loss trajectory.
Table 4.6: Distribution Loss for FY 2015-16 to FY 2018-19

FY 2015-16 FY 2016-17 FY 2017-18 FY 2018-19
Year
(Re-casted) (Re-casted) (Projected) (Projected)
Distribution Loss 18.83% 16.68% 16.00% 15.00%
As regards the distribution loss trajectory of UPCL, the Commission has already dealt with
the issue in detail in its Order dated April 05, 2016 on Approval of Business Plan and Multi Year
Tariff of UPCL for FY 2016-17 to FY 2018-19 and finds no reason to revisit the same again. However,

2018-19
in this regard the Commission would like to point out towards the loss reduction initiatives
proposed by UPCL. UPCL has been proposing the same initiatives over the years whose results
should have started accruing by now. However, from the submissions of the Petitioner as given in
the Table below it emerges that there are 7 distribution divisons of UPCL which have the
distribution loss in excess of 30% which also includes EDD (U), Roorkee which has a distribution
loss of 36.43% which is unacceptable considering the fact that it is a urban division covered under
R-APDRP Scheme.
Table 4.7: High Distribution Loss divisions as on 31.03.2017

S. No. Distribution Division Loss (%)
1. EDD, Narayanbagar 48.64%
2. EDD, Rudraprayag 32.75%
3. EDD (U), Roorkee 36.43%
4. EDD, Bageshwar 31.76%
5. EDD Vikasnagar 33.45%
6. EDD, Uttarkashi 36.69%
7. EDD, Dharchula 30.20%
The Commission in its Order dated March 29, 2017 had also observed that there were seven
divisions which had a loss level of more than 30% in FY 2015-16. As is evident from above, there are
still seven divisions where the losses are still above 30%. Further, it is to be noted that in case of
Roorkee Urban Division, the losses have marginally increased from 36.28% in FY 2015-16 to 36.43%
in FY 2016-17. Same is also observed in case of Vikasnagar where losses have increased from 32.66%
in FY 2015-16 to 33.45% in FY 2016-17. The only inference that could be drawn here is that the
Petitioner has not made any serious and focussed efforts in reducing division wise losses despite
being pointed out by the Commission in its previous Orders. The Commission directs the
Petitioner to submit division wise action plan to reduce the losses in the above divisions to
below 20% within one month from the date of issuance of this Order.
As has been held by the Commission in its Tariff Order dated March 29, 2017, losses in other
categories of consumers (excluding HT Consumers) as on March 31, 2016 were about 30.90%.
Moreover, the Commission in the said Order had also held that for past 3 years virtually there had
been no reduction in losses of other category of consumers which clearly suggested that the
Petitioner did not put in serious efforts in reducing the losses for other categories, thereby, failing to
bring these losses within acceptable limits. Further, to reduce the distribution losses at LT level and
to achieve loss level within acceptable limits, the Petitioner was required to take up the certain

works, like replacement of all mechanical meters in a time-bound manner in all the divisions,
removal of all ghost/fictitious/non-existent consumers from its billing database, ensuring that all
the meters of the consumers are read and their bills prepared and distributed within time and also
that no provisional bills namely NA/NR are issued for more than two billing cycles in accordance
with the provision of Electricity Supply Code Regulation, 2007, etc. However, UPCL is yet to
achieve its target in ensuring compliances.
Moreover, the Petitioner is also a signatory of the GoI Ujwal Discom Assurance Yojana
(UDAY) wherein keeping in view the overall position, i.e. the actual losses of the Company,
investment is to be made to improve the operational performance, consumer habits and the
administrative situations. Further, the level of AT&C Losses of the Petitioner Company was fixed as
follows under UDAY.
Table 4.8: AT&C Loss Target as per UDAY

Year Level of AT&C Loss
2015-16 17%
2016-17 16%
2017-18 15%
2018-19 14.50%
Further, the Petitioner also submitted that during the meeting of State Advisory Committee
held on 05.03.2018 in the office of the Commission to consider the request of the Petitioner of
revisiting the distribution loss levels and targets. The Petitioner requested the Commission to
specify the loss reduction trajectory in accordance with the target of distribution losses as fixed
under UDAY. However, it needs to be understood that the targets fixed under UDAY Scheme are
for AT&C losses and not distribution losses. The tariffs are fixed by the Commission based on the
approved distribution losses in accordance with the MYT Regulations. The Commission had
approved a distribution loss level of 15% for FY 2016-17, however, the distribution losses required
to match up with the targets set in the UDAY scheme will be much lower than that approved by the
Commission. UPCL in its Tariff Petition for FY 2018-19 has itself projected a collection efficiency of
98.75% and 99% for FY 2017-18 and FY 2018-19 respectively. Thus, to reach at the targets set under
UDAY at the proposed collection efficiency, the distribution losses of UPCL for the two financial
years have to be 13.92% and 13.64% respectively against the targets set by the Commission of
14.75% and 14.50%.

2018-19
Further, as already dealt by the Commission in Chapter 3 of this Order, Hon’ble ATE in its
Judgment dated May 18, 2015 in Appeal no. 180 of 2013 has also held that it did not find any
infirmity in fixing up of loss reduction targets by the State Commission as no instances were
produced where funds for capital works for strengthening of distribution system had been denied
by the State Commission in the ARR. Hence, the issue was decided against UPCL by Hon’ble ATE.
Hence, based on the above discussions and considering the ground realities, the
Commission decides not to revise the loss trajectory for FY 2018-19. UPCL’s inaction and
continuous high level of inefficiency does not allow it to seek revision of the loss trajectory
approved by the Commission, which if allowed would defeat the intent of the MYT framework.
Accordingly, the Commission decides to retain the distribution loss for FY 2018-19 at 14.50% and
the Petitioner is directed to abstain from seeking relaxation in this regard in every ensuing Tariff
Petition once the issue has been settled by the Commission. The distribution loss trajectory
proposed by the Petitioner and approved by the Commission for FY 2018-19 is shown in the Table
below:
Table 4.9: Distribution Losses for FY 2018-19

Particulars Proposed Approved
Distribution Losses 15.00% 14.50%
In line with the approach adopted by the Commission in its MYT Order, the Commission
has considered the entire distribution loss reduction target for each year of the Control Period as
reduction in commercial losses of the Petitioner and has, therefore, considered the impact of
distribution loss reduction in terms of increase in sales due to efficiency improvement.
Accordingly, the estimated energy requirement at distribution periphery, State periphery

and approved loss level for FY 2018-19 is given in the Table below:

Table 4.10: Energy Input requirement approved by the Commission for FY 2018-19
Particulars Quantum
Distribution Sales (MU) 11,853.72
Loss level for Energy Input (MU) 14.75%
Energy Input required at T-D interface (MU) 13,904.65
Commercial Loss reduction (%) 0.25%
Commercial Loss reduction (Additional sales due to efficiency improvement)
34.76
(MU)
Total sales with efficiency improvement (MU) 11,888.48
Overall Distribution Loss (%) 14.50%
PTCUL Loss (%) 1.55%
Energy Input at State periphery (MU) 14,124
4.4 Aggregate Revenue Requirement
“69. Aggregate Revenue Requirement for each Financial Year of the Control Period
(1) The total annual expenses and return on equity of the Distribution Licensee for each financial year
of the Control Period shall be worked out on the basis of expenses and return allowed in terms of these
Regulations.
(2) The retail supply tariff of a Distribution Licensee for each financial year of the Control Period shall
provide for recovery of Aggregate Revenue Requirement of the Distribution Licensee for each financial
year of the Control Period, as reduced by the amount of non-tariff income, income from wheeling in
respect of open access customers, income from Other Business and receipts on account of cross-
subsidy surcharge and additional surcharge for the relevant financial year, as approved by the
Commission, and subsidy from the State Government for the financial year, if any, and shall comprise
the following:
(a) Cost of power purchase;
(b) Transmission charges;
(c) System Operation Charges i.e. Fee and Charges paid to NLDC/RLDC/SLDC
(d) Interest and Finance charges on Loan Capital and on consumer security deposit;
(e) Depreciation, including and amortisation of intangible assets;
(f) Lease Charges

2018-19
(g) Operation and Maintenance expenses;
(h) Interest on working capital; and
(i) Return on equity capital;
(j) Income-tax;
(k) Provision for Bad and doubtful debts
(3) Net Revenue Requirement from sale of electricity = Aggregate Revenue Requirement, as above,
minus:
(a) Non-Tariff Income;
(b) Income from wheeling charges recovered from open access customers;
(c) Income from Other Business, to the extent specified in these Regulations;
(d) Receipts from cross-subsidy surcharge from open access consumers; and
(e) Receipts from additional surcharge on charges of wheeling from open access consumers.
(f) Any revenue subsidy or grant received from the State Government other than the subsidy
under Section 65 of Electricity Act, 2003.”
The Commission in this Order has determined the Net Revenue Requirement for FY 2018-19
as detailed in the subsequent Paras of this Chapter.
4.5 Power Purchase Cost
The energy requirement of UPCL is met from various sources which includes the following
generating stations:
 State Generating Stations of UJVN Ltd.

 NTPC Ltd.
 NHPC Ltd.
 NPCIL
 SJVN Ltd.
 THDC Ltd.
 Independent Power Producers (IPPs)
 State Gas Generating Stations
 SHPs and Solar Power Generators

 Deficit in power purchases met through Banking arrangements, open market purchases
etc.
The Petitioner in its Petition submitted the source wise power purchase from various
sources along with the cost of power purchase. For projecting the availability of power for FY 2018-
19, the Petitioner has considered the average of the actual monthly energy generation during the
past 3 years including FY 2017-18. The Petitioner has considered actual generation for the period till
April to August and has estimated the power availability during the remaining months of FY 2017-
18 (September-March) based on the average of actual monthly energy generation (ex-bus) during
the past 3 years (FY 2014-15, FY 2015-16, FY 2016-17). The Petitioner further submitted that in case
of aberration in generation from a generating station during any year or month due to non-
functioning or maintenance, shut-down, etc., the same has been excluded for the purpose of
projections. For the stations which have not been operational for complete 3 years, the average of
the actual monthly generation during the years in which such stations have been fully operational
has been considered. For new and upcoming stations, the Petitioner has considered Uttarakhand’s
expected entitlement from each station using the normative technical norms. The energy availability
from various sources has been projected by the Petitioner based on the following:
 UJVN Ltd. – For 10 LHPs and SHPs, the average of actual and estimated monthly energy
generation during the past 3 years, i.e. FY 2015-16 to FY 2017-18 has been considered.
However, in case of Khatima average for last two years has been considered due to
intermittent availability of power during FY 2014-15 from the plant.
 NTPC – For all the stations of NTPC except for Koldam, the average of actual and
estimated monthly energy generation during the past 3 years from FY 2015-16 to FY
2017-18 has been considered. For Koldam HPS, the energy availability for FY 2018-19 has
been considered on the basis of average of actual and estimated monthly generation for
the past two years from FY 2016-17 to FY 2017-18.
Further, the share in monthly generation has been considered by considering the total
allocation from each station to Uttarakhand.
 NHPC – The Petitioner has considered the average of actual and estimated monthly
energy generation during the past 3 years from FY 2015-16 to FY 2017-18. The same has
2018-19
also been considered for projecting free power share from Dhauliganga, Tanakpur
stations.
Further, the share in monthly generation has been considered by considering the total
allocation from each station to Uttarakhand.
 NPCIL – For NAPP and RAPP, the average of actual and estimated monthly generation
during the past 3 years from FY 2015-16 to FY 2017-18 has been considered.
 SJVNL – For Nathpa Jhakri, the average of actual and estimated monthly generation
during the past 2 years from FY 2016-17 to FY 2017-18 has been considered. For Rampur
HPS, the energy availability has been projected based on the average of actual and
estimated monthly generation during the past 3 years from FY 2015-16 to FY 2017-18.
 THDC – For Tehri and Koteshwar, the average of actual and estimated monthly energy
generation during the past 3 years from FY 2015-16 to FY 2017-18 has been considered.
The same has also been considered for projecting free power share from these stations.
 Vishnu Prayag HEP and GVK Srinagar – For Vishnu Prayag HEP, the average of actual
and estimated monthly energy generation during FY 2015-16 to FY 2017-18 has been
considered. For GVK Srinagar the Petitioner has estimated the monthly availability for
the remaining seven months of FY 2017-18 based on 2 years monthly generation from FY
2015-16 and FY 2016-17 and 2 years average from FY 2016-17 and FY 2017-18 for the
entire year FY 2018-19 as the plant was not operational during FY 2014-15 and first few
months of FY 2015-16 due to floods.
 UREDA stations and IPPs – The Petitioner has estimated the monthly availability from
UREDA and IPP stations (except for Sasan, Greenko Budhil, Sarju II and III, Tanga,
Badiyar, solar roof top, Gama, Beta & Shravanti) based on previous three years’ average
of monthly generation. The availability from Sasan UMPP has been calculated
considering 3 years average generation from FY 2015-16 to FY 2017-18. Monthly
estimation from Greenko Budhil Station has been considered by the Petitioner on the
basis of Design Energy, auxiliary consumption & Uttarakhand’s share in power
generated. Monthly estimation for Sarju II Station has been estimated by the Petitioner
on the basis of actual monthly generation in FY 2016-17 and first six months of FY 2017-
18. For Sarju-III the Petitioner has considered 3 year average of actual and estimated
monthly generation of FY 2015-16 to FY 2017-18. For Co-generation plants the Petitioner

has considered the average of actual and estimated generation for three years from FY
2015-16 to FY 2017-18. The availability from solar rooftop generators and Small Solar IPP
that have been commissioned recently has been estimated by the Petitioner on the basis
of 15% CUF, while for older solar stations the availability has been projected on the basis
of actual generation till August 2017.
 State Gas Stations: The availability from Gama & Shravanti Gas Plant has been
calculated considering 85% PLF and normative auxiliary consumption for FY 2018-19.
 Upcoming stations – The energy availability from stations expected to be commissioned
by FY 2018-19 has been projected considering the likely COD of such generating stations
from various sources such as CEA reports, PPA signed and as per the information made
available by the generators. Power availability has been computed considering the
normative performance parameters and share allocation to UPCL. With regard to Beta
Station energy availability has been considered from the contracted 107 MW considering
85% PLF and normative auxiliary consumption.
 Forward banking of power – The Petitioner has proposed a forward banking of 1069
MU in FY 2018-19 during the months of May to September 2018 which shall be returned
from October 2018 to March 2019 to meet the projected deficit of 1055 MU. The balance
energy has been proposed to be carried forward for the next financial year.
 Transmission Losses – The Petitioner has considered the POC losses of 4.55% and intra-
State transmission losses of 1.60%.
 The Petitioner has proposed the total power purchase of 14351 MU in FY 2018-19.
The Commission has gone through the submissions of the Petitioner. The
Commission for projection purposes has considered the energy availability from various generating
stations on the basis of three years month-wise energy availability from all the generating stations.
On the basis of monthly energy availability and estimated energy requirement, the Commission has
computed the deficit/surplus quantum of power which the Petitioner would be required to
purchase/bank depending on its requirement. The Commission for projecting power purchase has
considered both existing generating stations and upcoming stations to be commissioned by FY
2018-19 in which UPCL has firm allocation. The detailed approach for approving the power
2018-19
purchase quantum has been discussed below.
For projecting the energy availability quantum from various new sources, the Commission
sought the following information from the Petitioner:
 Likely COD of the upcoming generating stations along with source on which the
Petitioner has relied upon.
In reply, UPCL submitted the following:
 Copies of PPAs of the upcoming generating stations.
 Likely COD of the upcoming generating stations along with the source data.
The Commission while projecting the quantum of energy available from various sources for
FY 2018-19 has made the assumptions as detailed below.
4.5.1 Power Purchase from UJVN Ltd.
The Commission has considered the availability from generating stations of UJVN Ltd. as
under:
Table 4.11: Power Purchase from UJVN Ltd.
Stations of UJVN
Basis Rationale
Ltd.
Average of actual month wise gross generation in FY 2015-16,
UJVN Ltd. (9 LHPs) FY 2016-17 & FY 2017-18 (actual for 9 months, projections for 3 Three Year’s Average
months); as per the
Average of actual month wise gross generation in FY 2015-16, Commission’s earlier
Maneri Bhali-II FY 2016-17 & FY 2017-18 (actual for 9 months, projections for 3 approach
months);
For Pathri and Mohammadpur energy availability considered
as actual generation in FY 2017-18 from April to December and Actual generation has
SHPs, viz. Pathri,
for Jan to March on the basis of three months actual generation been considered after
Mohammadpur &
in FY 2016-17. For Galogi, average of actual month wise gross completion of RMU
Galogi
generation in FY 2015-16 to FY 2017-18 (actual for 9 months, works.
projections for 3 months)
The Commission has estimated the energy availability from these generating stations to
UPCL at State Periphery after considering the normative auxiliary consumption and excluding the
share allocation to Himachal Pradesh. The summary of energy availability from UJVN Ltd. for FY
2018-19 as estimated by the Petitioner and the Commission is shown in the Table below:

Table 4.12: Summary of Energy Availability from UJVNL for FY 2018-19

(MU)
Particulars Claimed Approved
UJVN Ltd.-Main Stations 2812.89 2901.07
Maneri Bhali-II 1249.80 1264.50
Small Hydro
Pathri 129.38
Mohammadpur 224.53 53.08
Galogi 6.02
Total 4287.21 4354.05
4.5.2 Power Purchase from NHPC Ltd.
The Commission has considered the availability from generating stations of NHPC Ltd. as
under:
Table 4.13: Power Purchase from NHPC Ltd.
Stations of
Basis Rationale
NHPC
Salal
Chamera I
Chamera II
Chamera III Average of actual month wise gross
Uri generation in FY 2015-16, FY 2016-17 & FY Three Year’s Average as per the
Dulhasti 2017-18 (actual for 9 months, projections Commission’s earlier approach
Sewa II for 3 months)
Uri II
Prabati III
Tanakpur
Dhauliganga
UPCL at State Periphery after considering the normative auxiliary consumption, station wise POC
losses approved for the quarter January, 2018 to March, 2018 and considering share allocation to
Uttarakhand. The summary of energy availability from NHPC Ltd. for FY 2018-19 as estimated by
the Petitioner and the Commission is shown in the Table below:

2018-19
Table 4.14: Energy Availability from NHPC Ltd. for FY 2018-19 (MU)
Station Estimated by UPCL Approved
Salal 39.05 40.07
Tanakpur 7.80 16.55
Chamera I 80.92 81.52
Chamera II 23.37 25.37
Chamera III 51.32 53.31
Uri 98.63 95.87
Dhauliganga 49.20 56.10
Dulhasti 119.12 123.32
Sewa II 28.08 29.34
Uri II 66.82 62.96
Parbati III 34.97 35.68
Free Power-Tanakpur 39.52 51.07
Free Power-Dhauliganga 119.69 121.00
Total 758.49 792.17
4.5.3 Power Purchase from THDC India Ltd.
The Commission has considered the availability from generating stations of THDC Ltd. as
under:
Table 4.15: Power Purchase from THDC India Ltd.
Stations of
Basis Rationale
THDCIL
Tehri HEP Average of actual month wise gross
Three year average considered as per
generation in FY 2015-16, FY 2016-17 & FY
the standard approach followed by the
Koteshwar HEP 2017-18 (actual for 9 months, projections for 3
Commission in past.
months)
losses approved for the quarter January, 2018 to March, 2018 and considering the share allocation to
Uttarakhand. The summary of energy availability from THDC Ltd. for FY 2018-19 at State periphery
as estimated by the Petitioner and the Commission is shown in the Table below:
Table 4.16: Energy Availability at State periphery from THDC Ltd. for
FY 2018-19 (MU)
State Estimated by UPCL Approved
Tehri HEP 100.44 107.46
Free Power-Tehri HEP 354.02 349.69
Koteshwar HEP 74.28 76.83
Free Power-Koteshwar HEP 140.03 138.49
Total 668.78 672.47

4.5.4 Power Purchase from NTPC Ltd.
The Commission has considered the availability from generating stations of NTPC Ltd. as
under:
Table 4.17: Power Purchase from NTPC Ltd.
Stations of NTPC Basis Rationale
Singrauli STPS
Rihand STPS
Rihand I
Rihand II
Rihand III
Unchahar TPS
Actual monthly generation of
Unchahar I Average of actual month wise gross generation in FY
past 3 years as per the
Unchahar II 2015-16, FY 2016-17 & FY 2017-18 (actual for 9 months,
standard approach followed
Unchahar III projections for 3 months)
by the Commission
Anta CCPP
Auraiya CCPP
Dadri CCPP
Dadri (NCTPP)
Jhajjar
Kahalgaon TPS
Koldam
UPCL at State Periphery after considering the normative auxiliary consumption station wise POC
Uttarakhand. The summary of energy availability from NTPC Ltd. for FY 2018-19 at State periphery
Table 4.18: Energy Availability from NTPC Ltd. at State periphery for FY
2018-19 (MU)
Singrauli STPS 666.99 710.71
Rihand STPS
Rihand I 263.79 279.62
Rihand II 251.21 251.44
Rihand III 275.07 289.15
Unchahar TPS
Unchahar I 223.66 214.25
Unchahar II 134.75 100.72
Unchahar III 90.91 81.95
Anta CCPP 29.92 35.61
Auraiya CCPP 30.07 39.82
Dadri CCPP 87.51 92.09
Dadri (NCTPP) 37.74 39.36
Jhajjar 31.85 40.76
Kahalgaon TPS 194.42 269.15
Koldam 204.21 196.67
Total 2522.10 2641.29

2018-19
4.5.5 Power Purchase from SJVN Ltd.
The Commission has considered the availability from generating stations of SJVN Ltd. as
under:
Table 4.19: Power Purchase from SJVN Ltd.
Stations of
Basis Rationale
SJVNL
Nathpa
Average of actual month wise gross generation Actual monthly generation of past 3 years
Jhakri HEP
in FY 2015-16, FY 2016-17 & FY 2017-18 (actual as per the standard approach followed by
Rampur
for 9 months, projections for 3 months) the Commission
HPS
Uttarakhand. The summary of energy availability from SJVN Ltd. for FY 2018-19 as estimated by
the Commission is shown in the Table below:
Table 4.20: Energy Availability from SJVN Ltd. at State periphery for FY
2018-19 (MU)
Nathpa Jhakri HEP 71.86 67.07
Rampur HPS 211.27 217.79
Total 283.13 284.86
4.5.6 Power Purchase from NPCIL Stations
For estimating the energy availability from these stations the Commission has considered
the monthly average generation for the last three years, i.e. FY 2015-16 to FY 2017-18 ( 9 months
actual and 3 months projection). The Commission has estimated the energy availability from these
generating stations to UPCL at State Periphery after considering the normative auxiliary
consumption, station wise POC losses approved for the quarter January, 2018 to March, 2018 and
considering the share allocation to Uttarakhand. The summary of energy availability from NPCIL
for FY 2018-19 as estimated by the Commission is shown in the Table below:
Table 4.21: Energy Availability from NPCIL at State periphery for FY 2018-19 (MU)
NAPP 145.81 152.68
RAPP 150.50 153.26
Total 296.31 305.94

4.5.7 Power Purchase from existing Renewable Energy Sources
The existing renewable energy sources include the hydro power stations of UREDA, IPPs,
co-generation plants, and existing as well as upcoming solar power plants within the State and solar
power to be received from outside the State. The Commission has considered the energy availability
at State periphery for renewable energy sources as projected by UPCL.
The summary of energy availability from existing renewable energy sources for FY 2018-19
Table 4.22: Energy Availability from existing Renewable Energy Sources for FY
2018-19 (MU)
Existing renewable energy sources 848.43 848.44
4.5.8 Power Purchase from Vishnu Prayag HEP and GVK Srinagar (State Royalty Power)
For estimating the State Royalty power from Vishnu Prayag HEP, the Commission has
considered the average of actual monthly generation for the years FY 2015-16, FY 2016-17 and FY
2017-18 (actual for 9 months, projections for 3 months). With regard to GVK Srinagar, the
Commission has considered the actual energy received in FY 2016-17 as submitted by the Petitioner.
The Commission has estimated the energy availability from these generating stations to UPCL at
State Periphery after considering the normative auxiliary consumption, actual POC losses in March
2018 and considering the free power share of 12% to Uttarakhand. The summary of energy
availability from these stations as estimated by the Petitioner and the Commission is shown in the
Table below:
Table 4.23: Energy Availability from Vishnu Prayag HEP at State

Periphery (State Royalty Power) for FY 2017-18 (MU)
Estimated by Estimated by
Station
UPCL Commission
Vishnu Prayag HEP (State Royalty Power) 190.18 227.33
GVK Srinagar 135.16 133.49
4.5.9 Power Purchase from Sasan UMPP
For estimating the energy availability from Sasan UMPP, the Commission has considered
the actual monthly generation of FY 2015-16 to FY 2017-18. The Commission has estimated the
energy available from Sasan UMPP to UPCL at State Periphery after considering the normative

2018-19
auxiliary consumption, station wise POC losses approved for the quarter January, 2018 to March,
2018 and considering share allocation to Uttarakhand. The summary of energy availability from
Sasan UMPP for FY 2018-19 as estimated by the Petitioner and the Commission is shown in the
Table below:
Table 4.24: Energy Availability from Sasan UMPP at State periphery

for FY 2018-19 (MU)
Sasan UMPP 670.14 690.27
4.5.10 Power purchase from State Gas Generating Station
The Commission vide its Order dated February 8, 2016 approved the PPA between UPCL
and Gama Infrapop (P) Ltd. (Kashipur CCPP), for sale of power corresponding to 107 MW (gross
capacity) to UPCL. Further, the Commission vide Order dated July 20, 2016 had approved the PPA
between UPCL and Sravanthi Energy Pvt. Ltd. for sale of power corresponding to 214 MW (gross
capacity) to UPCL. Further, the Commission has also approved the PPA between UPCL and Beta
Infrapop (P) Ltd. for sale of power corresponding to 107 MW (gross capacity) to UPCL. Considering
the present status of Beta station, the Commission has considered energy availability for the station
from the month of October 2018. The Commission has considered the energy availability from these
stations considering the normative performance parameters in accordance with the Regulations.
The summary of energy availability from these stations for FY 2018-19 as estimated by the
Commission is shown in the Table below:
Table 4.25: Energy Availability from State Gas Generating

Stations at State periphery for FY 2018-19 (MU)
Station Estimated by UPCL Estimated by Commission
Kashipur CCPP 776.80 776.80
Sravanthi Energy 1553.61 1553.61
Beta CCPP 776.80 388.40
Total 3107.21 2718.81
4.5.11 Power purchase from Greenko Budhil Hydro
The Commission vide its Order dated December 26, 2016 had approved the PPA between
UPCL and Greenko Budhil Hydro for sale of power corresponding to 70 MW (gross capacity). The
Commission, accordingly, has considered the energy availability from the generating station based
on the month wise Design Energy. The Commission has estimated the energy available from the

generating station to UPCL at State Periphery after considering the normative auxiliary
consumption, POC losses approved for the quarter January, 2018 to March, 2018 and also excluding
the free share of Himachal Pradesh. The summary of energy availability from Greenko Budhil
Hydro for FY 2018-19 as estimated by the Commission is shown in the Table below:
Table 4.26: Energy Availability from Greenko Budhil Hydro at

State periphery for FY 2018-19 (MU)
Greenko Budhil Hydro 235.09 222.79
4.5.12 Power purchase from upcoming generating stations
The upcoming generating stations include upcoming solar generating stations, Unchahar IV,
Meja Thermal and Kishanganga Hydro Stations. The upcoming solar generating stations have
already been considered in the energy projections from renewable sources as discussed earlier in
this Section. With regard to Bhyunder ganga the Commission is of the view that the station will not
come in FY 2018-19. With regard to Unchahar IV station, it is already commissioned and, therefore,
power availability has been considered from April 2018. With regard to Meja Thermal, as per CEA it
is expected that the first unit shall begin supply from April 2018 whereas the second unit shall begin
supply from August 2018. With regard to Kishanganga station, the Commission has considered the
projections of the Petitioner. The Commission has estimated the energy available from the
generating station to UPCL at State Periphery after considering the normative auxiliary
consumption, station wise POC losses approved for the quarter January, 2018 to March, 2018 and
allocation as submitted by the Petitioner.
The summary of energy availability from upcoming generating stations expected to achieve
COD by FY 2018-19 as estimated by the Petitioner and the Commission is shown in the Table below:
Table 4.27: Energy Availability from Upcoming Stations at State

periphery for FY 2018-19 (MU)
Bhyunder Ganga 11.12 -
Unchahar IV 199.79 204.46
Meja Thermal 112.35* 304.85
Kishanganga 25.06 25.10
Total 337.20 534.41
* The Petitioner has considered commencement of supply from December 2018

2018-19
4.5.13 Energy available from Firm Sources
The total energy available from firm sources estimated by the Petitioner and approved by
the Commission is as shown in the Table given below:
Table 4.28: Energy Availability from Firm Sources at State periphery for FY
2018-19 (MU)
Generating Stations UPCL Approved
UJVN Ltd. 4287.21 4354.05
NHPC^ 783.55 817.27
THDC 668.78 672.47
NTPC* 2721.89 2845.74
NPCIL 296.31 305.94
SJVNL 283.13 284.86
Other Renewable 848.43 848.44
Free Power-Vishnu Prayag 190.18 227.33
Sasan UMPP 670.14 690.27
Kashipur CCPP 776.80 776.80
Shravanti gas plant 1553.61 1553.61
Beta gas plant 776.80 388.40
Bhyunder Ganga 11.12 0.00
Meja Power Plant 112.35 304.85
Greenko Budhil Hydro 235.09 222.79
GVK Srinagar 135.16 133.49
Total Firm Sources 14350.54 14426.32
^Includes Kishanganga
*Includes Unchahar IV
4.5.14 Power Purchase for fulfilling RPO
UPCL in its Petition has submitted that as per amendment to Regulation 9(1) of the UERC
(Tariff and Other Terms for Supply of Electricity from Renewable Energy Sources and non-fossil
fuel based Co-Generating Stations) Regulations, 2013 (Principal Regulations) made vide the UERC
(Tariff and Other Terms for Supply of Electricity from Renewable Energy Sources and non-fossil
fuel based Co-Generating Stations) Regulations, 2013 (Sixth Amendment) Regulations, 2017, the
Petitioner is required to purchase a minimum percentage of its total electricity requirement for own
consumption excluding consumption met from hydro sources of power from renewable energy
sources under renewable purchase obligation during each financial year. In accordance with the
above, the Petitioner has claimed expenses towards meeting RPO obligations as shown in the Table
below:

Table 4.29: Additional Purchase for fulfilling RPO as claimed for FY 2018-19
2018-19
S.No. Particulars
Non-Solar Solar
1. Total Power Purchase at State Periphery excluding Hydro (MU) 7785.30 7785.30
2. RPO Target (%) 10.25% 6.75%
3. RPO Target (MU) 797.99 525.51
4. Total Power Purchase to meet RPO Target 723.36 360.71
5. Unmet Target 74.63 164.79
6. Past Unmet brought forward - -
7. Total Unmet Target 74.63 164.79
The Commission notified UERC (Tariff and Other Terms for Supply of Electricity from
Renewable Energy Sources and non fossil fuel based Co-generation Stations) (Sixth Amendment),
Regulations, 2017 dated September 08, 2017 wherein it had specified the RPO for FY 2018-19 as
6.75% for Solar & 10.25% for Non-Solar to be determined on the basis of own consumption
excluding consumption met from hydro sources of power from renewable energy sources. Based on
the estimated power purchase from renewable energy sources, the status of fulfillment of RPO and
additional renewable purchase required is as shown in the Table below.
Table 4.30: Additional Purchase for fulfilling RPO

Particulars Units FY 2018-19
Total Power Purchase at State Periphery MU 14123.57
Less: Hydro MU 7094.41
Energy Excluding Hydro Energy MU 7029.16
RPO
Solar % 6.75%
Non-Solar % 10.25%
RPO
Solar MU 474.47
Non-Solar MU 720.49
Total MU 1194.96
Purchase from Renewable Sources
Solar MU 360.71
Non-Solar MU 676.21
Total MU 1036.92
Additional Energy to be purchased for fulfilment of RPO
Solar MU 113.75
Non-Solar MU 44.28
Total MU 158.03

2018-19
Hence, the additional energy to be purchased from Solar and Non-Solar renewable energy
sources, over and above the energy sources listed above, for fulfilling the RPO targets for FY 2018-
19 is 158.03 MU for FY 2018-19.
4.5.15 Deficit/ (Surplus) energy
The Petitioner in its Petition has proposed forward banking, i.e. advance banking of 1069
MU power in FY 2018-19 from the month of May 2018 to September 2018 and has proposed to
withdraw 1055 MU in April 2018 and from the month of October 2018 to March 2019 through return
banking. In addition to the above, the Petitioner has estimated 14 MU to be carried forward to meet
the deficit of next financial year.
However, as per the Commission’s projection as against the energy requirement of 14123.57
MU during FY 2018-19, the total estimated energy available from firm sources is 14426.32 MU
leaving an overall surplus of 302.75 MU. However, as per month wise requirement and energy
availability the monthly deficit during winter months works out to 614.81 MU and monthly surplus
during summer and monsoon month works out to 917.56 MU. The Commission directs the
Petitioner to bank the surplus energy during the month of May 2018 to September 2018 and
withdraw the same in the month of October 2018 to March 2019. The balance 302.75 MU of power
can be banked for the next financial year FY 2019-20.
The Petitioner should put its sincere efforts to suffice its need during deficit period from
the surplus energy available during the monsoon period through appropriate banking.
4.5.16 Cost of power purchase
The Petitioner submitted that the cost of power purchase has been projected based on the
following assumptions.
 UJVN Ltd. - For the procurement of power from 10 LHPs and SHPs of UJVN Ltd.,
the Petitioner has considered the Net AFC and Energy charges for UJVN Ltd.’s Large
stations and MB II as approved in its MYT Order dated April 05, 2016. For small
SHPs, the Petitioner has considered the cost as per the AFC approved by the
Commission in its MYT Order dated April 05, 2016.

 NTPC: The annual fixed charges and variable charges have been derived (in
proportion to UPCL’s share) from the tariff order approved by CERC for each
station. The Variable charge for the generating stations for the first four months of FY
2017-18 has been increased by 4% for FY 2018-19. For Koldam Station, since an
interim tariff has been determined by CERC for FY 2016-17, a 3% increase has been
considered to arrive upon the AFC of FY 2018-19 as per the approach followed by the
Commission. The energy charges for Koldam HEP has been calculated by dividing
the 50% of the AFC by design energy and normative auxiliary consumption of the
plant. The net charges payable has been derived after deducting the state royalty
share of power.
 NHPC: Annual fixed charges (AFC) for Salal, Tanakpur, Chamera I & II, Uri,
Dhauliganga, Dulhasti and Uri II has been derived from the tariff order issued for FY
2014-19 by CERC. Annual fixed charges (AFC) for the remaining stations were not
available, and therefore, the cost of power purchase for FY 2017-18 has been
increased by 3%. The energy charges have been calculated by dividing 50% of the
AFC by the design energy and normative auxiliary consumption of the plant. The net
charges payable have been derived after deducting the state royalty share of power.
 SJVNL: For Nathpa Jakhri HEP station, annual fixed charges (AFC) as specified in
the respective CERC tariff order for the control period of FY 2014-19 has been
considered. For Rampur HEP, since the Annual fixed charges (AFC) for the station
for FY 2018-19 was not available, therefore, the AFC approved for FY 2015-16 has
been escalated by 3% per annum to determine the fixed cost for FY 2018-19. The
energy charges have been calculated by dividing 50% of the AFC by the design
energy and normative auxiliary consumption of the plant. The net charges payable
have been derived after deducting the state royalty share of power.
 THDC: For Tehri station annual fixed charges (AFC) as specified in the respective
CERC tariff order for the control period of FY 2014-19 has been considered. For
Koteshwar HEP where CERC tariff order was not available, the AFC for FY 2017-18
has been considered from the recent power purchase bills of FY 2017-18 and
escalated by 3% for FY 2018-19. The energy charges have been calculated by dividing
50% of the AFC by the design energy and normative auxiliary consumption of the

2018-19
plant. The net charges payable have been derived after deducting the state royalty
share of power.
 NPCIL: For NPCIL plants, power purchase bills for FY 2017-18 has been increased by
3% to arrive at the cost for FY 2018-19.
 IPPs and Private Projects: The cost of power available from IPPs and other private
stations are as per tariff determined by UERC and for Sasan as per the tariff bid by
the developer for each year. The tariff for the small solar power plants has been
considered as per the tariff bid by the developer.
 Cost of Power from new stations: For CGS projects, which are under development,
the rate has been considered based on the provisional tariff considered by the
Commission in the Tariff Order for FY 2017-18. For those stations which are under
construction by the private developers, the tariff laid down in PPA/relevant
regulations or the tariff determined by the Commission has been considered.
 Cost of Free Power: The cost of free power has been calculated for FY 2018-19 based
on the approach adopted by the Commission in its earlier Tariff orders. The rate of
state royalty power has been considered equal to the average rate of power procured
by the Petitioner from large hydel stations.
 Cost of Injection and Withdrawal Charges of Banking: The Petitioner has
submitted that it has considered Rs. 1.00/kWh towards such charges.
 Cost of RPO Obligations: The Petitioner has considered REC floor price of Rs. 3500
for Solar and Rs. 1500 for non-solar to meet its RPO targets.
The Petitioner has projected the average power purchase cost of Rs. 3.43/kWh for FY 2018-
19.
 Water Tax - The Petitioner requested the Commission to consider the impact of
Water Tax in determination of ARR for the Petitioner.
Section 17 of The Uttarakhand Water Tax on Electricity Generation Act, 2012

specifies as follows:

“17. (1) The user shall be liable to pay the Water Tax under the Act at such rates as
the Government may by notification fix in this behalf.
(2) The State Government may review, increase, decrease or vary the rates of the
Water Tax fixed under this section from time to time in the manner it deems fit.”
The State Government vide the notification dated November 7, 2015 notified
the applicable rates of Water Tax.
The Petitioner in its Petition has submitted that the impact of water tax is Rs.
233.27 Crore on the basis of actual water tax paid in FY 2016-17. The Commission in
its MYT Order dated 05.04.2016 had computed the likely impact of Water Tax for the
Petitioner for FY 2016-17 to FY 2018-19 as Rs. 153.82 Crore. However, considering the
actual water taxes paid in FY 2016-17 the Commission has considered water taxes to
be paid as claimed by the Petitioner. The same shall be trued up based on the actual
amount paid by the Petitioner for FY 2018-19 without considering the variation of the
same as efficiency gain or loss. The Commission directs the Petitioner to submit all
the relevant information along with the supporting documents for substantiating
the actual expenses incurred on account of Water Tax, for FY 2017-18 and FY 2018-
19 along with its proposals for True up for FY 2017-18 and FY 2018-19.
The Commission has estimated the cost of power purchase from various sources as detailed
below:

2018-19
Table 4.31: Approach of the Commission in estimating the Cost of Power Purchase
Source Approach of the Commission in estimating the cost of power purchase
The Commission has considered the approved Tariff of UJVN Ltd. (10 LHPs) for FY 2018-19.
As per the GoU Notification No. 601/1(2)/04(1)-1/2007 dated May 31, 2017, GoU imposed a
cess of Rs. 0.30/kWh and royalty of Rs. 0.10/kWh on saleable energy generated from hydro
generating stations which are under commercial operation for 10 or more years with cost of
UJVN Ltd.
generation below Rs. 2/kWh with effect from the date of notitication. Hence additional
impact on account of same has been considered.
For SHPs, the Commission has considered the applicable Tariff for those generating stations
as specified in the Renewable Energy Regulations or Orders of the Commission.
For the generating stations for which the Tariff Order for FY 2018-19 has been issued by the
NHPC Ltd., Central Electricity Regulatory Commission, the approved Tariff for FY 2018-19 has been
THDC Ltd., considered.
SJVN Ltd. For other stations, the latest approved Tariff has been considered with annual escalation of
3%.
For the generating stations for which the Tariff Order for FY 2018-19 has been issued by the
Central Electricity Regulatory Commission, the approved AFC for FY 2018-19 has been
NTPC Ltd. considered. For estimating the Energy Charges for FY 2018-19, to avoid substantial impact of
quarterly FSA, the weighted average rate of actual Energy Charges for the months of October
2017 to December 2017 has been considered with an escalation of 7%.
The tariff for NPCIL stations has been considered based on the actual billing during FY 2017-
NPCIL
18 which have been escalated by 3% to determine the costs for FY 2018-19.
The applicable tariffs for the respective generating stations within the State have been
Renewable considered as per the Tariff Orders issued by the Commission in accordance with the
energy sources Renewable Energy Regulations and the Tariff specified in the Renewable Energy
Regulations.
Sasan UMPP The applicable tariff for FY 2018-19 as per the PPA has been considered.
The tariff for Beta Station has been considered as Rs. 4.70/kWh as provisionally approved by
the Commission. With regard to Kashipur and Shravanthi stations the AFC approved by the
State Gas
Commission for FY 2018-19 has been considered. The Energy charges have been considered
Stations
on the basis of weighted average rate of actual Energy Charges for the months of October
2017 to December 2017 with an escalation of 7%.
Greenko Budhil The AFC approved by the Commission for FY 2018-19 has been considered alongwith truing
Hydro up impact of FY 2015-16 & FY 2016-17.
Additional
The Tariff for the additional purchase for fulfilling the Non-Solar RPO and Solar has been
purchase for
considered as Rs. 1500/REC and Rs. 3500/REC respectively.
fulfilling RPO
For upcoming renewable generating stations within the State, the applicable Tariff as per the
Upcoming
Renewable Energy Regulations has been considered. For Kishanganga, Meja and Unchahar
Stations
IV, a tariff of Rs. 4/kWh has been considered.
Open Access for Ppen access charges for banking corresponding to Deficit Energy has been considered on the
Banked Energy basis of PGCIL per unit transmission charges of FY 2017-18.
Water Tax Water tax of Rs. 233.27 Crore has been considered on the basis of that claimed by UPCL.

4.5.16.1 Cost of Free Power
As regards, the rate of power purchase for free power, the Commission, in its Tariff Order
dated March 18, 2008 had stipulated as under:
“As of now, as per State Government‘s letter dated March 11, 2003, the rate applicable for utilisation
of Free Power by UPCL is average pooled cost of power purchase from Central Generating Stations.
The Government of India‘s Electricity (Removal of Difficulty) Third Order, 2005 issued vide its
notification dated June 8, 2005 on the subject stipulates as follows:
2. Disposal of free electricity received by a State Government from hydro generating stations – The
State Government receiving free electricity from hydro power generating stations shall have
discretion to dispose off such electricity in the manner it deems fit according to the provisions of the
Act.
Provided that if such electricity is sold by the State Government to a distribution licensee, the
concerned State Commission shall have powers to regulate the price at which such electricity is
procured by the distribution licensee.
As per the statutory framework, the Commission is empowered to regulate the price at which the
UPCL will purchase free power from GoU.”
The Commission in its MYT Order dated May 06, 2013 for the first Control Period revised
the methodology for computing free power rate and had stated as follows:
“...
The Commission, accordingly, in the interest of consumers of the State has revisited the methodology
adopted by it for computation of rate of free power. The previous methodology no more hold good on
account of steep price revisions in the rates of energy available from firm sources. Moreover,
considering that fuel costs are increasing exponentially and the demand supply gap are likely to
increase further in future rendering the distribution utilities to depend on infirm/short/medium term
sources.
Further, the Commission is of the view that the free power rate should reflect a fair price considering
the segment pertaining to dominant firm source from which maximum power is procured by the
distribution utility in the State. For the State of Uttarakhand whose electricity demand is
predominantly met through large hydro generating stations, the free power rate should reflect the
tariff for electricity generated through large hydro generating stations. The Commission, therefore,

2018-19
has revised the methodology for computation of rate of free power and has considered free power rate
equal to the average rate of power procured by the Petitioner from Large Hydrogenerating stations...”
The Commission observes that GoU has imposed water tax on Hydro generating stations
located in the State and has also additionally levied cess and royalty of Rs. 0.40/kWh on it. It is also
observed that the Petitioner had to pay additional Rs. 233.27 Crore on account of water tax in FY
2016-17 and will also be paying substantial amount as cess and royalty on energy procured from
UJVN Ltd from May 31, 2017. The Commission is of the view that water tax and royalty, if
considered for computation of free power rate shall lead to double impact on the consumers of the
State as the consumers shall not only be bearing the burden of water tax, cess and royalty but also
the embedded cost of the same in the calculation of the free power rate.
Therefore, in the interest of consumers of the State, the Commission for computing free
power rate has excluded water tax, cess and royalty paid by State as well as Central Generating
Stations. The Commission ha,s accordingly, computed the free power rate for FY 2018-19 as follows:
Table 4.32: Summary of Free Power Rate for FY 2018-19

Quantum Total Cost Average Cost
Particulars
MU Rs. Crore Rs./kWh
UJVN Ltd. (9 LHPs) 2901.07 299.82 1.03
Maneri Bhali II 1264.50 213.59 1.69
NHPC 645.20 225.24 3.49
THDC 184.29 86.29 4.68
SJVNL 284.86 101.67 3.57
Greenko 222.79 83.13 3.73
Koldam 196.67 90.74 4.61
Average 5699.38 1100.49 1.93
The summary of estimated power purchase cost for FY 2018-19 is as shown in the Table
given below:

Table 4.33: Summary of power purchase cost for FY 2018-19

Claimed Approved
PP at State Average PP at State Average
Station Total Cost Total Cost
periphery Rate periphery Rate
MU Rs. Crore Rs./kWh MU Rs. Crore Rs./kWh
UJVN Ltd.
UJVN Ltd. (9 LHPs) 2812.89 364.43 1.30 2901.07 299.82 1.03
Maneri Bali II 1249.80 216.08 1.79 1264.50 213.59 1.69
Small Hydro 224.53 34.77 1.55 188.49 31.47 1.67
Royalty & Cess - 156.78 - - 166.62
Water Tax - 233.27 - - 233.27
Total UJVN Ltd. 4287.21 1005.33 2.35 4354.05 944.78 2.17
NHPC
Salal 39.05 9.80 2.51 40.07 5.50 1.37
Tanakpur 7.80 4.52 5.79 16.55 6.18 3.73
Chamera I 80.92 17.45 2.16 81.52 16.01 1.96
Chamera II 23.37 6.48 2.77 25.37 5.46 2.15
Chamera III 51.32 27.44 5.35 53.31 28.13 5.28
Uri 98.63 22.96 2.33 95.87 17.08 1.78
Dhauliganga 49.20 17.74 3.61 56.10 13.90 2.48
Dulhasti 119.12 72.61 6.10 123.32 59.56 4.83
Sewa II 28.08 14.24 5.07 29.34 15.07 5.14
Uri II 66.82 38.99 5.84 62.96 26.42 4.20
Parbati III 34.97 22.14 6.33 35.68 21.89 6.14
Kishanganga 25.06 10.51 4.19 25.10 10.04 4.00
Free Power-Tanakpur 39.52 9.67 2.45 51.07 9.86 1.93
Free Power-
119.69 29.27 2.45 121.00 23.36 1.93
Dhauliganga
Total NHPC 783.55 303.82 3.88 817.27 258.47 3.16
THDC
Tehri HEP 100.44 57.65 5.74 107.46 54.46 5.07
Free Power-Tehri HEP 354.02 86.57 2.45 349.69 67.52 1.93
Koteshwar HEP 74.28 31.96 4.30 76.83 31.83 4.14
Free Power-
140.03 34.24 2.45 138.49 26.74 1.93
Koteshwar HEP
Total THDC 668.78 210.43 3.15 672.47 180.55 2.68
NTPC
Singrauli STPS 666.99 156.24 2.34 710.71 155.98 2.19
Rihand STPS
Rihand I 263.79 65.88 2.50 279.62 68.07 2.43
Rihand II 251.21 56.45 2.25 251.44 57.25 2.28
Rihand III 275.07 87.26 3.17 289.15 89.72 3.10
Unchahar TPS
Unchahar I 223.66 100.48 4.49 214.25 90.61 4.23

2018-19
Table 4.33: Summary of power purchase cost for FY 2018-19

Claimed Approved
PP at State Average PP at State Average
Station Total Cost Total Cost
periphery Rate periphery Rate
MU Rs. Crore Rs./kWh MU Rs. Crore Rs./kWh
Unchahar II 134.75 56.09 4.16 100.72 41.61 4.13
Unchahar III 90.91 45.01 4.95 81.95 37.21 4.54
Anta CCPP 29.92 22.00 7.35 35.61 25.62 7.19
Auraiya CCPP 30.07 27.27 9.07 39.82 30.81 7.74
Dadri CCPP 87.51 44.49 5.08 92.09 48.62 5.28
Dadri (NCTPP) 37.74 16.83 4.46 39.36 20.52 5.21
Jhajjar 31.85 27.91 8.76 40.76 27.51 6.75
Kahalgaon TPS 194.42 77.34 3.98 269.15 89.80 3.34
Koldam 204.21 89.42 4.38 196.67 90.74 4.61
Unchahar IV 199.79 83.80 4.19 204.46 81.78 4.00
Total NTPC 2721.89 956.47 3.51 2845.74 955.86 3.36
NPCIL
Narora APP 145.81 37.92 2.60 152.68 42.95 2.81
Rajasthan APP 150.50 57.48 3.82 153.26 62.59 4.08
Total NPCIL 296.31 95.40 3.22 305.94 105.54 3.45
SJVNL
Nathpa Jhakri HEP 71.86 19.91 2.77 67.07 21.31 3.18
Rampur HPS 211.27 78.07 3.70 217.79 80.35 3.69
Total SJVNL 283.13 97.98 3.46 284.86 101.67 3.57
Other Renewable 848.43 430.90 5.08 848.44 432.34 5.10
Free Power-Vishnu
190.18 46.51 2.45 227.33 43.90 1.93
Prayag
Sasan UMPP 670.14 92.62 1.38 690.27 95.40 1.38
Gama Kashipur CCPP 776.80 389.76 5.02 776.80 412.80 5.31
Shravanti gas plant 1553.61 875.81 5.64 1553.61 909.38 5.85
Beta gas plant 776.80 365.10 4.70 388.40 182.55 4.70
Total Gas 3107.21 1630.66 5.25 2718.81 1504.72 5.53
Bhyunder Ganga 11.12 4.49 4.04 0.00 0.00 0.00
Meja Power Plant 112.35 47.12 4.19 304.85 121.94 4.00
Greenko Budhil
235.09 90.77 3.86 222.79 83.13 3.73
Hydro
GVK Srinagar 135.16 33.05 2.45 133.49 25.77 1.93
Open Access Charges
106.31 31.89
for banked energy
Total 14350.54 5151.87 3.59 14426.32 4885.98 3.39
The Commission, further, directs the Petitioner to seek prior approval of the Commission,
in case the variation in power purchase quantum or total power purchase cost in any quarter
exceeds by more than 5% of the approved power purchase quantum and cost for the respective
quarter worked out on pro-rata basis from the total approved quantum and cost for FY 2018-19 as
indicated in the Table below, failing which, the Commission may disallow power purchases so
made while Truing up of the ARR for FY 2018-19.
Table 4.34: Quarterly Power Purchase approved by the Commission for FY 2018-19
Power Purchase Quantum Power Purchase Cost
Quarter
(MU) (Rs. Crore)
April – June 3696.97 1252.11
July – September 4384.39 1484.93
October – December 3291.15 1114.66
January – March 3053.82 1034.28
Total 14426.32 4885.98
The base Energy Charges of thermal stations (base fuel cost) for the purpose of computation
of FCA is given in the Table below:
Table 4.35: Energy Charges of Thermal Generating Stations for FY 2018-19

Energy Charges (State Periphery)
Generating Station
(Rs./kWh)
Singrauli STPS 1.525
Rihand STPS 0.000
Rihand I 1.514
Rihand II 1.514
Rihand III 1.536
Unchahar TPS
Unchahar I 3.081
Unchahar II 3.081
Unchahar III 3.081
Anta CCPP 3.952
Auraiya CCPP 3.952
Dadri CCPP 3.713
Dadri (NCTPP) 3.484
Jhajjar 3.573
Kahalgaon TPS 2.525
Gama Infraprop 4.066
Shravanthi Energy 4.066
Beta Power 3.500
4.6 Cost of Meeting RPO Target
As discussed earlier, the Petitioner, in order to meet its RPO Targets will have to
additionally procure 113.75 MU and 44.28 MU from Solar and non-solar generating stations
respectively. The Commisison has factored in the cost towards meeting the RPO targets at the rate
of Rs. 3500/REC for solar and Rs. 1500/REC for non-Solar as proposed by the Petitioner. The cost,

2018-19
thus, works out to be Rs. 46.46 Crore. As the cost of solar generation is under steep decline, the
Petitioner should first seek to buy actual power in deficit months and REC should be an option of
last resort to meet solar as well as non-solar RPO. However, it should be ensured that their tariffs at
State periphery should not exceed Rs. 4.75/kWh, i.e. inclusive of PoC charges & losses.
4.7 Transmission Charges
4.7.1 Inter-State Transmission Charges payable to PGCIL
The Petitioner submitted that actual transmission charges paid for FY 2016-17 have been
considered to compute average per unit rate of transmission charges for FY 2016-17. The per unit
PGCIL charge for FY 2016-17 has been calculated using the amount paid and energy coming from
outside the State during the same period. The per kWh rate calculated has been escalated by 5% per
annum and then multiplied by the projected power purchase quantum to be received through
PGCIL network for FY 2018-19. The Petitioner has proposed the Inter-State Transmission Charges of
Rs. 412.68 Crore for FY 2018-19. The Commission has considered the energy received through
PGCIL network during April 2017 to December 2017 of FY 2017-18 and the actual amount paid to
PGCIL for computing per kWh rate. The Commission has then considered 4% escalation per annum
on the rate derived for FY 2017-18 to determine the rate for FY 2018-19 which has then been applied
on the energy projected to be received through PGCIL network in FY 2018-19. Accordingly, the
Inter-State Transmission charges approved for FY 2018-19 is Rs. 388.08 Crore.
4.7.2 Intra-State Transmission Charges payable to PTCUL
The Petitioner submitted that the Intra-State Transmission Charges for FY 2018-19 have been
projected by considering the ARR approved by the Commission vide its MYT Order dated April 05,
2016 for PTCUL.
The Commission has approved the Annual Transmission Charges for PTCUL of Rs. 192.46
Crore for FY 2018-19 vide its Order dated March 21, 2018. Hence, the Commission has considered
the same in the approval of ARR for FY 2018-19 for the Petitioner.
4.7.3 Transmission Charges
The Transmission Charges claimed by the Petitioner and approved by the Commission for

FY 2018-19 is as shown in the Table given below:
Table 4.36: Transmission Charges for FY 2018-19 (Rs. Crore)

Inter-State Transmission Charges 412.68 388.08
Intra-State Transmission Charges 323.40 192.46
Total 736.08 580.54
4.8 SLDC Charges
The Petitioner has claimed SLDC charges of Rs. 19.51 Crore for FY 2018-19 by considering
the ARR approved by the Commission vide its MYT Order dated April 05, 2016.
The Commission has approved the SLDC Charges of Rs. 16.84 Crore for FY 2018-19 vide its
Order dated March 21, 2018. Hence, the Commission has included the same in the ARR for FY 2018-
19 for the Petitioner.
4.9 GFA and Additional Capitalisation
4.9.1 GFA base for FY 2017-18 and FY 2018-19
The Commission vide its Order dated April 05, 2016 on approval of ARR for the second
Control Period had approved the capitalisation of Rs. 546.02 Crore for FY 2017-18 and Rs. 557.26
Crore for FY 2018-19. As against the same, the Petitioner, in its Petition has proposed the
capitalisation of Rs. 639.13 Crore and Rs. 1370.97 Crore for FY 2017-18 and FY 2018-19 respectively.
The Petitioner in its Petition has submitted that in order to achieve the anticipated load
growth and target loss reduction, it has carried out detailed analysis of capital investment required
for FY 2017-18 and FY 2018-19. The Petitioner further submitted that the investment plan has been
projected based on various technical and physical requirements carried out by the staff and,
thereafter, reviewed by the senior management. The Petitioner with regard to cost submitted that
the same has been projected based on the historical trends of UPCL and cost of various equipment
in FY 2017-18 with suitable escalation for FY 2018-19. The Petitioner further submitted that in cases
where recent cost estimates were not available, the Petitioner has considered cost of these materials
in FY 2016-17, discovered through market mechanisms or inputs from technical staff with suitable
escalations. The Petitioner projected capital expenditure for the 2 years as Rs. 1617.18 Crore. Out of
this, Rs. 947.14 Crore are proposed for Central schemes like R-APDRP, DDUGJY and IPDS while the

2018-19
remaining Rs. 670.04 Crore are proposed for the internal schemes proposed by UPCL. The
Petitioner further submitted that the capital investment planned for the next two years is expected
to achieve the following benefits:
a) Growth development plan to meet the load growth
b) Loss reduction
c) System reliability and safety improvement
d) Creation of Infrastructure Facilities & other miscellaneous works
The Petitioner has further submitted various schemes to achieve the above targets as shown
below:
a) Growth Development Plan to meet the load growth:
i. Construction of 33/11 kV Substation & associated 33 kV and 11 kV Lines for

strengthening of Distribution System
ii. Augmentation of Existing 33/11 kV substations
iii. Release of New PTW Connections
iv. Installation of meters for giving new connections
v. Deen Dayal Upadhyay Grameen Jyoti Yojana
vi. Installation of Breakers – 20 Nos- 33 kV Breakers
vii. Construction of 19 CSS where two transformers are installed at same place
viii. Laying of LT lines for new connections
b) Loss reduction
i. Installation of Capacitor Bank at 33/11 kV substations
ii. Implementation of R-APDRP Part A scheme
iii. Implementation of R-APDRP Part B scheme
iv. Implementation of IPDS
v. Implementation of AMR (Other than R-APDRP)
vi. Replacement of Mechanical Meters with Electronic Meters and Installation of

Electronic meters in un-metered connections
vii. Laying of 11 kV and 33 kV covered conductor for forest area

viii. Laying of 11 kV ABC cable
ix. Laying of LT ABC in theft prone area
x. Replacement of defective single and three phase meters
xi. Pre-Paid Metering
xii. Laying of 11 kV and 33 kV underground cables
c) System reliability & safety improvement:

i. Installation of Additional Distribution Transformers
ii. Installation of LT protection system on the transformers, fencing of

transformers, installation of poles and guard wires, reconductoring of lines,
etc.
d) Creation of infrastructure facilities & other misc. works:

i. Procurement of Sub-station and consumer meter testing equipment
ii. Consumer care centres, E-payment of bills and Cash collection centres
The Petitioner in its Petition estimated that the new expenditure incurred towards central
schemes in FY 2017-18 would be capitalized in the ratio of 50% and 50% in FY 2017-18 and FY 2018-
19 whereas new expenditure incurred in FY 2018-19 shall be entirely capitalised in FY 2018-19.
While the balance capital expenditure shall be capitalised as 25% every year in FY 2017-18 and FY
2018-19.
Additionally, the opening CWIP at the beginning of FY 2017-18 has been estimated by the
Petitioner to be capitalised in the ratio of 50:50 during FY 2017-18 and FY 2018-19. The Petitioner
has, accordingly, revised the additional capitalisation to Rs. 639.13 Crore and Rs. 1370.97 Crore for
FY 2017-18 and FY 2018-19 respectively. The capital expenditure and additional capitalisation as
proposed in the Petition and revised Petition is as shown in the Table below:
Table 4.37: Proposed Capital Expenditure and Capitalisation for FY 2017-18

and FY 2018-19 (Rs. Crore)
Proposed Capital Capitalization
Particulars
expenditure As per Tariff Petition
FY 2017-18 630.46 639.13
FY 2018-19 986.72 1370.97
Total 1617.18 2010.11
The Commission has gone through the submissions of the Petitioner. It is observed that the

2018-19
Petitioner has projected higher capitalisation in FY 2017-18 and FY 2018-19 than that approved in
the MYT Order dated April 05, 2016. The Commission in its MYT Order had observed that the
Petitioner in the past had projected higher capitalisation at the time of tariff determination,
however, the actual capitalisation historically achieved by the Petitioner is considerably lower. The
actual GFA addition carried out by UPCL in the last five years is as shown in the Table below:
Table 4.38: Actual GFA addition of UPCL (Rs. Crore)
Year Amount
FY 2012-13 369.76
FY 2013-14 265.17
FY 2014-15 595.03
FY 2015-16 284.78
FY 2016-17 321.99*
*Excluding De-Cap of Rs. 83.70 Cr, net add cap Rs. 238.29 Crore
In comparison to the capitalisation achieved during the last four years, the capitalisation
proposed for FY 2017-18 and FY 2018-19 is considerably higher. The Commission directed UPCL to
submit the status of capital works (both physical and financial) which has been proposed in FY
2017-18 and FY 2018-19. In response UPCL again submitted the details of capital expenditure
proposed by it without giving the status of the proposed work.
The Commission in its MYT Order had already taken a view on the capital expenditure after
detailed analysis and, therefore, the Commission finds no reason to revise the same considering the
historical achievement with regard to the capitalisation.
The Commission has, therefore, considered the capitalisation for FY 2017-18 and FY 2018-19
as approved in MYT Order dated April 05, 2016. However, during the Annual Performance
Review/Truing-up exercise, the Commission shall consider the Capitalisation on actual basis
subject to capitalisation of only those Schemes which fulfill the conditions as stipulated by the
Commission.
The Petitioner has proposed the draft Capitalization Process & Repair and Maintenance
Policy in the current Petition. The Petitioner has proposed certain assumption in the draft policy
that needs further clarification and accordingly the Commission is not approving the draft
capitalization and R&M policy submitted by the Petitioner in these proceedings and will take a
view on the same separately.
The Commission has, accordingly, approved the following capitalization and GFA for FY

2018-19.
Table 4.39: GFA base approved by the Commission for FY 2018-19 (Rs. Crore)
FY 2017-18 FY 2018-19
Particulars Claimed by Claimed by
Approved Approved
UPCL UPCL
Opening GFA 4218.85 4122.71 4857.98 4668.73
GFA addition during the year 639.13 546.02 1370.97 557.26
Closing GFA 4857.98 4668.73 6228.96 5225.98
4.10 Means of Finance
The Commission has approved the funding of the approved capitalisation for FY 2017-18
and FY 2018-19 by considering the average of the actual funding pattern of the Petitioner’s
capitalisation during FY 2012-13 to FY 2014-15. The Commission, as discussed above, has
considered the capitalisation as approved in the MYT Order for the second Control Period and,
therefore, the financing of the approved capitalisation has also been considered as same as
considered in the MYT Order dated April 05, 2016 which is as shown in the table below.
Table 4.40: Means of Finance approved by the Commission (Rs. Crore)

Particulars FY 2017-18 FY 2018-19
Capitalisation 546.02 557.26
Financing
Debt 309.11 315.47
Equity 40.96 41.81
Grant/Deposit Works 195.95 199.98
Total 546.02 557.26
4.11 Interest and Finance Charges
The Petitioner submitted that the interest expenses have computed considering the closing
loan approved by the Commission for FY 2016-17 in its APR Order dated March 29, 2017 after
carrying out following adjustments.
a) Difference in approved loans and actual loans for FY 2016-17.
b) Difference in loan from internal resources from FY 2012-13 on account of revision in

means of finance for the period FY 2012-13 to FY 2015-16.
New loans for FY 2017-18 and FY 2018-19 have been considered as per the means of funding
of capitalization provided in the Petition while the repayment has been considered equivalent to the

2018-19
depreciation for FY 2017-18 and FY 2018-19 in line with the UERC Tariff Regulations, 2015. The
Petitioner has considered weighted average rate of interest of 12.22%, which is equivalent to the
weighted average rate of interest as per audited accounts for FY 2016-17. The Petitioner submitted
that the interest on GPF loan shall be claimed based on the actual interest during the truing up for
the respective year.
Accordingly, the Petitioner has proposed the interest of Rs. 100.77 Crore for FY 2018-19. In
addition to it, the Petitioner has considered interest on loan of Rs. 18.33 Crore against REC Old Loan
as per the repayment schedule laid down in Tariff Order for FY 2009-10 dated 23rd October, 2009.
The Petitioner has further considered financing charges of Rs. 1.70 Crore for FY 2018-19. The
Petitioner has claimed the interest on consumer security deposit of Rs. 49.27 Crore for FY 2018-19.
The Petitioner has claimed the guarantee fee of Rs. 11.31 Crore for FY 2018-19, equivalent to the
actual fees paid by the Petitioner to the State Government in FY 2016-17.
“27. Interest and finance charges on loan capital and on Security Deposit
(1) The loans arrived at in the manner indicated in Regulation 24 shall be considered as gross
normative loan for calculation of interest on loan.
(2) The normative loan outstanding as on 1.4.2016 shall be worked out by deducting the
cumulative repayment as admitted by the Commission up to 31.3.2016 from the gross normative
loan.
(3) The repayment for each year of the Control Period shall be deemed to be equal to the
depreciation allowed for that year…
(5) The rate of interest shall be the weighted average rate of interest calculated on the basis of the
actual loan portfolio at the beginning of each year applicable to the project:
(6) The interest on loan shall be calculated on the normative average loan of the year by applying
the weighted average rate of interest.
…”

The Commission has considered the closing loan balance for FY 2016-17 as opening loan
balance for FY 2017-18. Thereafter, the Commission has considered the loan addition during FY
2017-18 as per the approved means of finance for FY 2017-18. The Commission has considered the
closing loan balance for FY 2017-18 as the opening loan balance for FY 2018-19. The Commission has
considered the loan addition during FY 2018-19 as per the means of finance approved above. The
Commission has considered the normative repayment equivalent to the approved depreciation for
the year. The Commission has considered the interest rate of 9.24% which is the actual weighted
average rate of interest for FY 2016-17. The Commission has determined the interest on loan by
applying the interest rate of 9.24% on the amount of average of the opening loan & closing loan
excluding the loan additions corresponding to the assets capitalised during the year. The
Commission has not allowed interest on additions during the year as the Petitioner capitalises the
assets at the end of the financial year and during the year, whatever interest accrues on the loan
portion corresponding to the capital expenditure, the same is Interest during construction and is
capitalised as CWIP. The Commission has considered the Interest on Security Deposit same as that
projected by the Petitioner. The interest on loan approved by the Commission for FY 2018-19 is as
shown in the Table given below:
Table 4.41: Interest on Loan approved by the Commission for FY 2018-19 (Rs. Crore)
Particulars Claimed Allowable
Opening Loan balance 725.44 759.26
Drawal during the year 342.81 315.47
Repayment during the year 144.87 142.42
Closing Loan balance 923.38 932.30
Interest Rate 12.22% 9.24%
Interest on Loan 100.77 63.58
Interest on CSD 49.27 49.27
Total Interest 150.04 112.85
In addition to above, the Commission has considered interest on account of REC Old Loan
of Rs. 18.33 Crore. With regard to guarantee fee, the Commission has considered the same amount
as approved for FY 2016-17, i.e. Rs. 5.59 Crore. The guarantee fee considered by the Petitioner for FY
2017-18 equivalent to the guarantee fee for FY 2016-17 also includes the provisions for penalty to be
paid to the State Government on account of non-payment of Guarantee Fee and also includes excess
provisioning of Rs. 0.07 Crore which cannot be allowed for the reasons already dealt in the previous
section.

2018-19
The financing charges of Rs. 1.70 Crore as considered for FY 2016-17 has also been
considered for FY 2018-19. Thus, the total interest expenses approved for FY 2018-19 works out to
Rs. 138.47 Crore as against the claim of Rs. 181.39 Crore.
4.11.1 Depreciation
The Petitioner submitted that the asset class wise depreciation has been computed
considering the projected capitalisation for each year and as per the rates of depreciation specified
in the UERC Tariff Regulations, 2015. Accordingly, the Petitioner has proposed the depreciation of
Rs. 144.87 Crore for FY 2018-19.
“28. Depreciation
(1) The value base for the purpose of depreciation shall be the capital cost of the asset admitted by
the Commission.
Provided that depreciation shall not be allowed on assets funded through Consumer Contribution
and Capital Subsidies/Grants.
(2) The salvage value of the asset shall be considered as 10% and depreciation shall be allowed up
to maximum of 90% of the capital cost of the asset.
...
(4) Depreciation shall be calculated annually based on Straight Line Method and at rates specified
in Appendix - II to these Regulations.
…”
The Petitioner has claimed depreciation on the average of opening and closing balances of
the depreciable GFA for the year. However, as observed from the audited accounts till FY 2016-17 of
the Petitioner, the Petitioner follows the practice of capitalising the assets on the last day of the
Financial Year. Nothing has been brought on record by the Petitioner to show that the asset is
capitalised when it is put to use. Infact, the Petitioner in its accounts also calculates depreciation on
the straight line method on opening GFA. Hence, the Commission has adopted the similar approach
as adopted by it in the previous Tariff Orders for allowing the depreciation on the opening GFA.
The Petitioner in the current proceedings has submitted that preparation of Fixed Assets
Registers of UPCL for FY 2013-14 to FY 2016-17 has been awarded to M/s RSA & Co. and the same
shall be submitted to the Commission by March 31, 2018.

In the absence of complete Fixed Asset Register, the Commission at this stage has considered
the weighted average rate of 5.21% computed for FY 2016-17 and has applied the same on the
opening depreciable GFA for FY 2018-19.
The depreciation approved by the Commission for FY 2018-19 is as shown in the Table given
below:
Table 4.42: Depreciation approved for FY 2018-19 (Rs. Crore)

Opening GFA - 4668.73
Grants - 1937.10
Depreciable opening GFA 3001.80 2731.63
Net addition during the year (less Grant) 512.60 357.27
Closing GFA 3293.95 3088.90
Depreciation rate 5.21% 5.21%
Depreciation 144.87 142.42
4.11.2 Operation and Maintenance expenses
Regulation 84 of the UERC Tariff Regulations, 2015, with regard to the Operation and
Maintenance expenses, specifies as follows:
“84. Operation and Maintenance Expenses
(1) The O&M expenses for the first year of the Control Period will be approved by the Commission
taking into account actual O&M expenses for last five years till Base Year subject to prudence
check and any other factors considered appropriate by the Commission.
(2) The O&M expenses for the nth year and also for the year immediately preceding the Control
Period i.e., FY 2015-16shall be approved based on the formula given below:-
O&Mn = R&Mn + EMPn + A&Gn
Where –
 O&Mn – Operation and Maintenance expense for the nth year;
 EMPn – Employee Costs for the nth year;
 R&Mn – Repair and Maintenance Costs for the nth year;
 A&Gn – Administrative and General Costs for the nth year;
(3) The above components shall be computed in the manner specified below:
EMPn = (EMPn-1) x (1+Gn) x (CPIinflation)
R&Mn = K x (GFAn-1) x (WPIinflation) and

2018-19
A&Gn = (A&Gn-1) x (WPIinflation) + Provision

Where –
 EMPn-1 – Employee Costs for the (n-1)th year;
 A&Gn-1 – Administrative and General Costs for the (n-1)th year;
Provision: Cost for initiatives or other one-time expenses as proposed by the Distribution
Licensee and approved by the Commission after prudence check.
 “K” is a constant specified by the Commission in %. Value of K for each year of the
control period shall be determined by the Commission in the MYT Tariff order based on
Distribution Licensee’s filing, benchmarking of repair and maintenance expenses,
approved repair and maintenance expenses vis-à-vis GFA approved by the Commission in
past and any other factor considered appropriate by the Commission;
 CPIinflation – is the average increase in the Consumer Price Index (CPI) for
immediately preceding three years;
 WPIinflation – is the average increase in the Wholesale Price Index (CPI) for immediately
 GFAn-1 - Gross Fixed Asset of the distribution licensee for the n-1th year;
 Gn is a growth factor for the nth year. Value of Gn shall be determined by the
Commission in the MYT tariff order for meeting the additional manpower requirement
based on Distribution Licensee’s filings, benchmarking and any other factor that the
Commission feels appropriate:
Provided that in case of a distribution licensee is governed by Government pay structure, the
Commission may consider allowing a separate provision in Employee expenses towards the
impact of VIIth Pay Commission.
Provided that repair and maintenance expenses determined shall be utilised towards repair and
maintenance works only.”
The O&M expenses include Employee expenses, R&M expenses and A&G expenses. In
accordance with Regulation 84 of the UERC Tariff Regulations, 2015, the O&M expenses for the
third year of the Control Period, i.e. FY 2018-19 shall be determined by the Commission taking into
account the actual O&M expenses of the previous years and any other factors considered
appropriate by the Commission. The submission of the Petitioner and the Commission’s analysis on
the O&M expenses for FY 2018-19 is detailed below.

4.11.3 Employee Expenses
The Commission had approved the employee expenses of Rs. 550.17 Crore for FY 2018-19 in
its MYT Order dated April 05, 2016. As against the same, the Petitioner in its Petition has proposed
employee expenses of Rs. 458.83 Crore as per the UERC Tariff Regulations, 2015.
The Petitioner has submitted that it has considered the closing normative gross employee
expenses of FY 2016-17 as the opening base (EMPn-1) for computation of normative employee cost in
FY 2017-18. Similarly, for FY 2018-19, the closing employee expenses for FY 2017-18 have been
considered as base in line with the methodology followed by the Commission. Further, escalation
factor, i.e. CPI inflation has been considered as 5.35%, which is the average increase in CPI for
preceding three years till the base year (FY 2014-15 to FY 2016-17). The Petitioner submitted that
based on the projected recruitment of employees it has considered Gn factor for FY 2017-18 as 20%
and nil for FY 2018-19 based on the addition in the number of employees. Further, the capitalisation
for FY 2018-19 has been considered as 15.63% based on the actual capitalization rate for FY 2016-17.
The Commission has computed the employee expenses in accordance with the UERC Tariff
Regulations, 2015. In accordance with the UERC Tariff Regulations, 2015, the Gn (growth factor) is
to be considered in the computation of employee expenses. The Commission, in the approval of the
Business Plan for the second Control Period from FY 2016-17 to FY 2018-19, based on the approved
HR Plan computed the Gn factors of 3.23% and 3.28% for FY 2017-18 and FY 2018-19 respectively
based on the recruitment of 338 employees per year in FY 2017-18 and FY 2018-19. The Commission
during the Technical Validation Session asked UPCL to submit the status of recruitment proposed
by it for FY 2017-18 and FY 2018-19. UPCL submitted that against the vacancy of 77 posts for Office
Assistant-III advertised in FY 2013-14, list of 67 candidates have been provided to UPCL by
Uttarakhand Pravidhik Shiksha Parishad. With regard to posts for 496 Technician Grade-2, the
Petitioner submitted that the same has been stopped by GoU vide letter No. 31/2014 dated
26.08.2014 and the matter is pending before Hon’ble Industrial Tribunal, Haldwani. The Petitioner
further submitted that it is in the process to fill around 225 posts comprising of Jr. Engineer,
Assistant Accountant and Draughtsman and submitted the status as follows.

2018-19
Table 4.43: Status of recruitment as submitted by the Petitioner for FY 2017-18 and
FY 2018-19
No. of
Group Post Current Status Remark
Vacancies
According to additional staff
structure vide G.O. •Advertisement was published on 26-09-
Junior Engineer
C 160 No.801/I(2)/2016-06(2)- 2016 by Uttarakhand Adhinastha
(E&M)
08/2002 dated 23-06-2016 SewaChayan Ayog.
Revised Adhiyachan for 160
posts of JE-E&M and 06 post of
JE-Civil has been sent to •Written exam for the post of Junior
Junior Engineer
C 6 Adhinastha Sewa Chayan Engineer (Trainee)- (E&M) and (Civil) held
(Civil)
Ayog vide letter No. 11184 on 05-11-2017.
dated 09-08-2016.
•Corporation letter no. 397-Dir
•According to additional staff
(HR)/UPCL dated 11-01-2017, letter No.
structure vide G.O.
4358-Dir(HR)/ UPCL/ KF-2 dated 27-4-
No.801/I(2)/2016-06(2)-
2017, letter no. 6306 Dir(HR)/ UPCL/KF-2
08/2002 dated 23-06-2016
Assistant dated 05-06-2017 & letter no. 9650
C 40 Adhiyachan for 40 posts of
Accountant Dir(HR)/ UPCL/KF-2 dated 22-08-2017
Assistant Accountant has been
have also been sent to Uttarakhand
sent to Adhinastha Sewa
Adhinastha Sewa Chayan Ayog to expedite
Chayan Ayog vide letter No.
the recruitment process of the aforesaid
11182 dated 09-08-2016.
posts.
•Adhiyachan for 19 posts of
Draughtsman has been sent to
•Written exam for the post of
C Draughtsman 19 Adhinastha Sewa Chayan
Draughtsman held on 25-06-2017.
Ayog vide letter No. 11183
dated 09-08-2016.
•List of 67 selected candidates has been
provided to UPCL by Uttarakhand
Pravidhik Shiksha Parishad
• As per direction of Hon'ble High Court,
Nainital dated 17-11-2015 in SPA No. 524
of 2015," …the corporation will not fill up
the posts, through this selection process,
which are occupied by the persons who
have been appointed on contract basis
through UPNL...".
•Advertisement was released
• The Hon'ble Industrial Tribunal,
on 9-2-2014.
Office Assistant- Haldwani issued award dated 12-09-2017
C 77 ●Written exam held on
III in Adjudication No.31/2014.
20-09-2015 by Uttarakhand
• A new writ petition is also filed by
Pravidhik ShikshaP arishad.
Shri.Vikas Kumar (one of the selected
candidates) in Hon'ble High Court,
Nainital.
• Through Corporation letter no.11828- Dir
(HR) /UPCL/ KF-2 dated 12-10-2017 &
letter no.12700- Dir (HR) /UPCL/ KF-2
dated 10-11-2017 letters have been sent to
the Govt. of Uttarakhand for the
permission to fill up the posts of direct
recruitment.
Total 302

As observed from the above, selection of candidates are yet to be done and, therefore, the
chances that the above post shall be filled up in FY 2017-18 is negligible. The Commission, therefore,
has considered that 67 employees who have been selected for the post of Office Assistant-III would
be joining the services in UPCL by 31.03.2018. Further, as evident from the above Table, for the post
of Assistant Account not even advertisement has been issued and, therefore, the same has not even
been considered to be filled up even in FY 2018-19. Recruitment in balance 185 posts (166 posts of JE
and +19 posts of Draughtsman) has been considered to be completed in FY 2018-19. The Petitioner
also submitted that it has sought permission from GoU to fill up another 105 posts of Assistant
Engineers and others in FY 2018-19 though it was cancelled by GoU vide Govt. letter no.
1537/1(2)/2017-06(2)-14/2016 dated 13.12.2017. Since the permission has still not been granted by
GoU, therefore, the Commissionn has not considered the same.
In this regard, it would also be relevant to point out that the State Government vide its
Order dated 28.09.2017 while approving the pay and allowances in accordance with the
recommendations of the Seventh Pay Commission, had freezed the recruitment/selection in all the
posts. Further, in posts where recruitment process had already been initiated, such recruitments are
also subject to the approval of the State Government. Hence, it is unlikely that actual recruitment
would exceed the recruitment of employees considered in this Order.
Thus, the Commission has considered the addition in manpower as 67 (OA-III) and 185
(JE+Draughtsman) during FY 2017-18 and FY 2018-19 respectively. Against the same, the number of
employees retiring during FY 2017-18 and FY 2018-19 has been shown as 327 and 196 respectively.
Thus, the Gn factors based on the recruitment and retirement details submitted by the Petitioner
works out to 0.00% for both FY 2017-18 and FY 2018-19.
In accordance with UERC Tariff Regulations, 2015, CPI inflation which is the average
increase in the Consumer Price Index (CPI) for the preceding three years is to be considered. The
Commission has calculated the annual growth in values of CPI (overall) based on the average of
preceding three full years upto FY 2016-17 as 5.35%.
The Commission has considered the gross normative employee expenses approved in the
true up for FY 2016-17 for projecting the employee expense for FY 2017-18 and FY 2018-19 in
accordance with the UERC Tariff Regulations, 2015. Further, the Commission has considered the
capitalisation rate of employee expenses as 17.44% based on the actual rate of capitalisation for FY

2018-19
2016-17.
In its MYT Order, the Commission had considered the impact of Seventh Pay Commission
to the tune of 20% of the approved net employee expenses and had allowed certain provision to the
Petitioner for FY 2016-17 to FY 2018-19. The Petitioner in the current Petition has submitted that
Govt. of Uttarakhand vide letter dated 17.10.2017 directed the Petitioner to bear the additional
liability on account of Seventh Pay Commission revision in salaries in two parts. The arrears arising
for first six months on account of revision, i.e. 01.01.2016 to 30.06.2016 are to be paid during FY
2017-18 and the remaining payment for 01.07.2016 to 31.12.2016 in FY 2018-19. The Petitioner
submitted that the payout of arrears on account of the recommendation of 7th Pay Commission has
been estimated at Rs. 2.5 Crore per month. The Petitioner submitted that as per the directions of the
GoU, the payout for six months has been included in FY 2017-18 while the additional expenditure in
terms of arrears and additional employee cost for FY 2017-18 and FY 2018-19 has been included in
FY 2018-19 based on the same monthly estimate. The Petitioner requested the Commission to true-
up the actual payment at the time of truing-up for the respective years. The Petitioner, accordingly,
has claimed an impact towards the pay revision of Rs. 82.83 Crore to be allowed in FY 2018-19.
The Commission has gone through the submissions of the Petitioner. The Commission
directed the Petitioner to submit the basis for computing pay revision impact of Rs. 2.50 Crore per
month. The Petitioner submitted the calculations for the same. In additional submission made by
the Petitioner, it was submitted that it has paid arrears of Rs. 3.87 Crore for the month of December,
2017 and January, 2018. It was also submitted that the pay for the month of February, 2018 was
being prepared. The Petitioner further submitted that due to calculation of TDS from salaries for FY
2017-18, the actual freezing of pay roll for the month shall be completed by third week of March,
2018 and, therefore, actual figures relating to payment of arrears in FY 2017-18 will only be available
after freezing of pay roll, i.e. by March end.
In this regard, the Government Order dated 25.09.2017 stipulates that payment of arrears
w.e.f. 01.01.2017 shall be made in cash while separate orders shall be passed for payment of arrears
for the period 01.01.2016 to 31.12.2016. In this regard, the Petitioner Company vide its Order dated
29.12.2017 held that the payment of Pay arrears for the period 01.01.2016 to 30.06.2016 shall be done
during FY 2017-18 and the payment of arrears pertaining to the period 01.07.2016 to 31.12.2016 shall
be done in FY 2018-19. Hence, during FY 2018-19, the impact of VII Pay Commission would be to

the extent of payment of arrears for the period 01.07.2016 to 31.12.2016 and also the impact of
increase in current pay. Hence, the Commission has considered the revised claim of Rs. 45.19 Crore
(Rs. 2.50 Crore for 18 months) as the impact of VII Pay Commission for FY 2018-19. However, the
Petitioner is directed to maintain separate details of the amount paid as arrears to its employees
on account of implementation of the recommendations of VII Pay Commission. The Commission
would carry out the truing up for FY 2017-18 and FY 2018-19 based on the actual impact of VII Pay
Commission including arrears and no sharing of gains and losses on this account would be allowed.
The normative employee expenses approved by the Commission for FY 2018-19 are as shown in the
Table below:
Table 4.44: Employee Expenses approved by the Commission for

FY 2018-19 (Rs. Crore)
Claimed by
UPCL
EMPn-1 423.03 352.53
Gn 0.00% 0.00%
CPIinflation 5.35% 5.35%
EMPn = (EMPn-1) x (1+Gn) x
445.65 371.39
(1+CPIinflation)
Capitalisation rate 15.63% 17.44%
Less: Employee expenses capitalised 69.66 64.78
Net Employee expenses 376.00 306.62
Enhanced impact of pay Revision 82.83 45.19
Total Employee expenses 458.83 351.80
4.11.4 R&M Expenses
The Commission had approved the R&M expenses of Rs. 146.80 Crore for FY 2018-19 in its
MYT Order dated April 5, 2016. As against the same, the Petitioner has proposed R&M expenses of
Rs. 141.47 Crore. The Petitioner submitted that R&M expenses have been computed as per UERC
The Commission has determined the R&M expenses in accordance with UERC Tariff
Regulations, 2015. The Commission has considered the K factor of 2.67% as approved in the MYT
Order dated April 5, 2016. The Commission has considered the opening GFA for FY 2018-19. The
Commission has considered the WPI inflation of 1.07% which is the average increase in the
Wholesale Price Index (WPI) for FY 2014-15 to FY 2016-17.
The R&M expenses approved by the Commission for FY 2018-19 are as shown in the Table

2018-19
below:
Table 4.45: R&M Expenses approved by the Commission for FY 2018-19

(Rs. Crore)
FY 2018-19
Particulars
Claimed by UPCL Approved
K 2.80% 2.67%
GFAn-1 4857.98 4668.73
WPIinflation 1.07% 1.07%
R&Mn = K x (GFAn-1) x (1+WPIinflation) 141.47 125.98
4.11.5 A&G Expenses
The Commission had approved the A&G expenses of Rs. 24.36 Crore for FY 2018-19 in its
MYT Order dated April 5, 2016. The Petitioner, in its Petition, has proposed the A&G expenses for
FY 2018-19 as Rs. 47.39 Crore as per the UERC Tariff Regulations, 2015.
The Commission has considered the approved normative A&G expenses in the true up for
FY 2016-17 for projecting the A&G expenses for FY 2017-18 and FY 2018-19. The Commission has
considered the WPI inflation of 1.07% which is the average increase in the Wholesale Price Index
(WPI) for FY 2014-15 to FY 2016-17. The Commission has considered the capitalisation rate of
36.66%, the same as trued up for FY 2016-17.
The Commission in addition has also considered the License Fee of Rs. 2.80 Crore as per the
license fee specified by the Commission. Further, the Commission has approved provision towards
data centre cost as well as consultancy charges paid to Que Next for data forecasting as the
Petitioner has incurred expenses of Rs. 6.40 Crore in FY 2016-17. The Commission has projected the
same for FY 2018-19 based on the WPI inflation for FY 2017-18 and FY 2018-19 which works out to
Rs. 6.54 Crore.
In addition to the normative A&G expenses, the Petitioner has submitted that it had
identified some newly introduced recurring expenses and has proposed an additional 'Provision’
needed for activities such as upkeep of the data centre and other works carried out under the R-
APDRP scheme. These additional expenses relates to network connectivity charges, facility
management charges, annual maintenance charges for software solutions & hardware installed as
part of the R-APDRP works. The Petitioner also submitted that the expenditure on account of such
heads was not included in the earlier years and are, therefore, not covered under the normative
A&G expense approved by the Commission that were considered on the base year of FY 2014-15/
FY 2015-16. The Petitioner has estimated an amount of Rs. 7.77 Crore in FY 2017-18 and Rs. 17.74
Crore in FY 2018-19 against various heads including AMC of software and hardware
implementation as part of R-APDRP works, annual subscription of licenses and software,
bandwidth charges for connectivity, etc. The detailed list of additional expenses under A&G
expenses submitted by the Petitioner is provided in the Table below:
Table 4.46: Additional Provisioning for Data Centre (Rs. Crore)
S.
Particulars FY18 FY19 Description
No.
Expenditure done on SMS
1. 0.08 0.08 -
Gateway
Network Bandwidth
2. Service Provider (M/s 1.08 1.30 Bandwidth charges
Tatatele Servises)
Call Center staff provided by outsource agency running on 24x7 basis at
3. Executives for Data Centre 0.52 0.57
Dehradun for handling consumer complaints
Expenditure on MPLS Consists of Connectivity charges for links at DC/DR/site offices across
4. 1.16 1.20
VPN to BSNL Uttarakhand
Cost of Automatic Meter Reading installed at Substations and Distribution
5. AMR Cost (Idea Cellular) 0.16 0.30
Transformer.
AMC services (M/s Wipro Provide AMC services for the installed system like DG, Electrical Panels,
6. 0.33 0.49
Ltd. DRC-Haldwani) Fire Detection, Fire Suppression, Rodent etc. at DR Haldwani
AMC Services (M/s
Provide AMC services for the installed system like DG, Electrical Panels,
7. Nikom Infrasolution Pvt. 0.36 0.40
Fire Detection, Fire Suppression, Rodent etc. at DR Haldwani
Ltd.)
AMC Services (Redington DC AMC Cost for installed Hardware at Data Center Dehradun consists of
8. 0.85 0.86
India Ltd.) various server and storage
License Cost (M/s Sify IBM software License Cost for the installed IBM Tivoli and IBM Network
9. 2.00 1.04
Technologies Ltd) management software.
Microsoft License Cost
10. - 0.50 Microsoft Software License for the installed microsoft software and OS
(M/s Ricoh India Ltd.)
Facility Management Services in which vendor will provide the support for
11. FMS Cost - 1.87
the installed system for 5 years from Aug 2015 i.e. upto July 2020
Hardware AMC Cost (DR Hardware AMC Cost for the installed hardware at Disaster Recovery Center
12. 1.03 2.06
AMC Cost) Haldwani
Consists of various expenses like insurance of DC/DR, Consulting charges
13. Misc. expenditure 0.17 0.38
of CA, LAN installation in offices, procurement of small IT equipment’s etc.
Software AMC Cost. It consists of Arc GIS/Arch FM software AMC cost
14. GIS AMC Cost - 4.20
which has to be paid for the period from 2014-2017
IT consultant will be hired to provide the IT roadmap for UPCL and for
15. Unified IT consultant - 0.28
policy formation for future IT systems
M/s Fluentgrid Ltd for handling the changes which are coming in the
Technical Support Services
16. - 0.68 commercial softwares like Metering, Billing, Collections etc due to change in
for m-Power Software
requirement/regulations/policies etc.
17. AMC Cost m-Power - 0.59 Annual maintenance charges for the m-Power software
Manpower for SCADA Consists of manpower cost which will be hired for running the SCADA
18. - 0.95
Operations operations on 24x7 basis in Dehradun
Additional A&G expense against Data Centre cost and other works under
19. Total 7.77 17.74
R-APDRP
The Petitioner also submitted that it had received an in-principle approval for the proposed
2018-19
one-time cost for hardware, software and supply of modems required for implementing GPRS
based Integrated Automatic Meter Reading System on 12,000 consumers to be executed on turnkey
basis vide Commission’s Order dated 28th September, 2017. The Petitioner estimated an additional
annual cost of Rs. 5.04 Crore for O&M expenses towards meter reading along with analysis report
and has requested the Commission to allow an additional provision against the same to meet the
O&M expenses arising out of these new installations for FY 2018-19.
In this regard, it is pointed out that O&M expenses and in particular A&G expenses is a
controllable expense and the endeavour of the Petitioner should be to incur the same prudently and
keep it to a bare minimum. The Commission has allowed certain provision towards data centre cost
for FY 2018-19 as dealt above. Further, certain items claimed under upkeep of Data Centre and
other works carried out under R-APDRP Scheme relates to Repairs and Maintenance expenses as
have been booked by the Petitioner also in FY 2016-17 as discussed in Chapter 3 of the Order and
will be covered under the R&M expenses. The Petitioner is directed to book these expenses
separately under the relevant accounting head, i.e. R&M expenses or A&G expenses and claim
the same during truing up of the respective years.
With reference to the additional annual cost of Rs. 5.04 Crore for O&M expenses towards
meter reading along with analysis report under IAMR, the Commission in its Order dated
28.09.2017 has already held as under:
“(4) With regard to O&M expenses of Rs. 25.20 Crore for a period of 5 years for the IAMR System
as mentioned in Petitioner’s submissions dated 05.07.2017 & 01.08.2017, the Commission does not
agree with the same and is of the view that these O&M expenses are exorbitantly high. Keeping in
view of higher O&M expenses, the licensee should revisit the scope of O&M works specified for the
said project and prepare a mechanism for inhouse data analysis and preparation of report by licensee’s
officers/staff, as this would not only reduce the proposed O&M expenses but also be beneficial for the
licensee in developing its in-house capability as well as reducing its over dependency on the external
agencies.
...
The Petitioner shall revisit the scope of O&M works specified for the said project as suggested by the
Commission at para 10 (4) above in order to minimize the Operation & Maintenance expenses of the
project.”

However, it is surprising to note that the Petitioner has again projected a cost of Rs. 5.04
Crore under this head despite Commission’s findings contrary to the same. The Petitioner is again
directed to revisit the scope of O&M works specified for the said project and prepare a mechanism
for inhouse data analysis and preparation of report by licensee’s officers/staff failing which the
same may be disallowed by the Commission. The Petitioner is also directed to book expenses
separately under O&M expenses for the expenses related to IAMR.
The normative A&G expenses approved by the Commission for FY 2018-19 are as shown in
the Table below:
Table 4.47: A&G Expenses approved by the Commission for FY 2018-19 (Rs. Crore)
A&Gn-1 30.86 28.82
WPIinflation 1.07% 1.07%
Gross A&G expenses 31.19 29.13
Capitalisation rate 31.11% 36.66%
Less: A&G expenses capitalized 9.70 10.68
Net A&G expenses 21.49 18.45
Provision (Data Centre) 25.90 6.54
License Fee - 2.80
A&Gn = A&Gn-1 x (1+WPIinflation) + Provision 47.39 27.79
4.11.6 O&M Expenses
The O&M expenses approved by the Commission for FY 2018-19 are as shown in the Table
below:
Table 4.48: O&M Expenses as approved by the Commission for FY 2018-19 (Rs. Crore)
FY 2018-19
Particulars
Claimed by UPCL Approved
Employee expenses 458.83 351.80
R&M expenses 141.47 125.98
A&G expenses 47.39 27.79
Total O&M expenses 647.68 505.57
4.11.7 Interest on Working Capital
The Petitioner has submitted that the interest on working capital for FY 2018-19 has been
proposed in accordance with UERC Tariff Regulations, 2015. Accordingly, the Petitioner has
proposed the IWC of Rs. 26.06 Crore for FY 2018-19.
Regulation 33(2) of the UERC Tariff Regulations, 2015 specifies as follows:

2018-19
“(2) Distribution
a) The Distribution Licensee shall be allowed interest on the estimated level of working capital
for the financial year, computed as follows:
(i) Operation and maintenance expenses for one month;
(ii) Maintenance spares @ 15% of operation and maintenance expenses; plus
(iii) Two months equivalent of the expected revenue from sale of electricity at prevailing
tariffs;
(iv) Capital required to finance such shortfall in collection of current dues as may be
allowed by the Commission; minus
(v) Amount held as security deposits under clause (a) and clause (b) of sub-section (1)
of Section 47 of the Act from consumers and Distribution System Users; minus
(vi) One month equivalent of cost of power purchased, based on the annual power
procurement plan.”
The Commission has determined the interest on working capital for FY 2018-19 in
accordance with the UERC Tariff Regulations, 2015.
The Commission has computed the interest on working capital in accordance with UERC
4.11.7.1 One Month O&M Expenses
The annual O&M expense approved by the Commission is Rs. 505.57 Crore for FY 2018-19.
Based on the approved O&M expenses, one month’s O&M expenses work out to Rs. 42.13 Crore for
FY 2018-19.
4.11.7.2 Maintenance Spares
The Commission has considered the maintenance spares as 15% of annual O&M expenses in
accordance with UERC Tariff Regulations, 2015, which works out to Rs. 75.84 Crore for FY 2018-19.
4.11.7.3 Receivables
The Commission has approved the receivables for two months equivalent to the expected

revenue from the sale of electricity at the net revenue requirement of Rs. 5997.50 Crore for FY 2018-
19, which works out to Rs. 999.58 Crore for FY 2018-19.
4.11.8 Capital required to finance shortfall in collection of current dues
The Petitioner has claimed Rs. 71.14 Crore towards the capital required to finance the
shortfall in collection of current dues.
The Commission has approved the collection efficiency of 99.00% for FY 2018-19 while
approving the Business Plan of UPCL for the second Control Period of FY 2016-17 to FY 2018-19. In
accordance with the provisions of the UERC Tariff Regulations, 2015 the Commission has approved
the capital required to finance shortfall in collection of current dues as shown in the Table given
below:
Table 4.49: Capital required to finance the shortfall in collection of current dues
approved by the Commission
Particulars Legend FY 2017-18
Net Revenue Requirement (Rs. Crore) A 5997.50
Collection efficiency approved B 99.00%
Difference C=100%-B 1.00%
Short fall in current dues (Rs. Crore) CxA 59.97
4.11.9 Adjustment for security deposits and credit by power suppliers
The Petitioner has proposed the amount held as security deposit as Rs. 788.34 Crore and one
month of power purchase cost as Rs. 429.32 Crore totalling to Rs. 1217.66 Crore for FY 2018-19.
The Commission has allowed fortnightly billing of variable charges to the gas generators in
the State as they have to make the payment to GAIL on fortnightly basis. Hence, the Commission
has relaxed the requirement of adjustment of power purchase cost of one month to 15 days in case
of the three gas generators in the State to facilitate UPCL in meeting the power purchase payments
to them. For other generators the adjustment of one month would continue. The Commission has
also considered the same amount of security deposit as proposed by the Petitioner and, accordingly,
the Commission has approved the total amount of Rs. 1186.43 Crore for FY 2018-19 as the amount
held as security deposits and credit by power suppliers.
Based on the above, the total working capital requirement of the Petitioner for FY 2018-19,
works out to Rs. (8.91) Crore (negative amount). The Commission has, therefore, not approved

2018-19
interest on working capital for FY 2018-19.
4.11.10Return on Equity
The Petitioner has considered the opening Equity for FY 2018-19 as Rs. 565.96 Crore. The
Petitioner has considered the equity addition during the year as per the proposed financing plan for
the year. The Petitioner has proposed the Return on Equity at the rate of 16.50% on the average
equity for the year. Accordingly, the Petitioner has proposed the Return on Equity of Rs. 93.38
Crore for FY 2018-19.
Regarding the Return on Equity, Regulation 26 of the UERC Tariff Regulations, 2015
specifies as follows:
“26. Return on Equity
(1) Return on equity shall be computed on the equity base determined in accordance with Regulation
24.
Provided that, Return on Equity shall be allowed on account of allowed equity capital for the assets
put to use at the commencement of each financial year.
(2) Return on equity shall be computed on at the base rate of 15.50% for thermal generating stations,
transmission licensee, SLDC and run of river hydro generating station and at the base rate of 16.50%
for the storage type hydro generating stations and run of river generating station with pondage and
distribution licensee on a post-tax basis.”
In accordance with the UERC Tariff Regulations, 2015, Return on Equity is allowable on the
opening equity for the year. Hence, the Commission has determined the Return on Equity for FY
2018-19 considering the eligible opening equity for return purposes.
The Commission has considered the closing eligible equity for return purposes approved for
FY 2016-17 as the opening balance for FY 2017-18. Thereafter, the Commission has considered the
equity addition during FY 2017-18 as per the approved means of finance for FY 2017-18. The
Commission has considered the closing balance for FY 2017-18 as the opening balance for FY 2018-
19.
The Return on Equity approved by the Commission for FY 2018-19 is as shown in the Table
below:

Table 4.50: Return on Equity approved by the Commission for FY 2018-19 (Rs. Crore)
Opening Equity 565.96 474.19
Addition during the year 169.79 41.81
Closing Equity 735.75 516.00
Rate of Return 16.50% 16.50%
Return on Equity 93.38 78.24
4.11.11Income Tax
The Petitioner has not claimed any Income Tax in its ARR proposals for FY 2018-19.
“34. Tax on Income
Income Tax, if any, on the income stream of the regulated business of Generating Companies,
Transmission Licensees, Distribution Licensees and SLDC shall be reimbursed to the Generating
Companies, Transmission Licensees, Distribution Licensees and SLDC shall be reimbursed to the
Generating Companies, Transmission Licensees, Distribution Licensees and SLDC as per actual
income tax paid, based on the documentary evidence submitted at the time of truing up of each year of
the Control Period, subject to prudence check.”
As stated above, Income Tax is admissible at the time of Truing up and, hence, the
Commission has not considered any Income Tax in the approval of ARR for FY 2018-19.
4.11.12Provision for Bad and doubtful debts
The Petitioner has proposed provision for bad debts up to 1% of the estimated annual
revenue requirement subject to actual writing off of bad debts in the previous years.The Petitioner
further submitted that receivables for sale of power equivalent to Rs. 629.25 Crore were transferred
to UPCL on 09.11.2001 under the scheme of division of Assets and Liabilities between UPPCL &
UPCL. As against these receivables an amount equivalent to Rs. 230.01 Crore was also transferred to
UPCL towards provision for Bad and Doubtful Debts. The Petitioner further submitted that most of
these receivables received under the transfer scheme are irrecoverable and needs to be Written Off.
The Petitioner further submitted that as per the directions of the Commission it has drafted a policy
for Provisioning & Writing Off of Bad and Doubtful Debts which has been submitted along with the
Petition and has requested the Commission to approve this scheme and also authorize the

2018-19
Petitioner to write off the receivables received under transfer scheme as per the provisions of this
policy.
“31. Bad and doubtful debts
(1) The Commission may allow a provision for bad and doubtful debts upto one percent (1%) of
the estimated annual revenue of the distribution licensee, subject to actual writing off bad debts
by it in the previous years.
Provided further that where the total amount of such provisioning allowed in previous years for
bad and doubtful debts exceeds five (5) per cent of the receivables at the beginning of the year, no
such appropriation shall be allowed which would have the effect of increasing the provisioning
beyond the said maximum.”
As discussed in Chapter 3 of the Order, the Petitioner has chosen to ignore the provisions of
Rs. 230 Crore inherited by it from UPPCL against the opening debtors of Rs. 619 Crore. The Transfer
Scheme agreed by the two Corporation dates back to the year 2001. It cannot be ruled out that out of
Rs. 619 Crore inherited by UPCL, some amount may be bad and doubtful by now which has to be
written off by the Petitioner with the total amount of provisions available with it. However, the
Petitioner has not put on record any documentary evidence substantiating that most of these
receivables received under the transfer scheme are irrecoverable and needs to be written off.
The Commission in the previous Tariff Order had directed the Petitioner to carry out an
audit of receivables and also identify and classify the same. Though the Petitioner has submitted a
draft bad debt policy, however, the same needs to be supported by audit report of receivables. The
Commission as of now has not considered the provision for bad and doubtful debts in the approval
of ARR for FY 2018-19 in accordance with the UERC Tariff Regulations, 2015. Further, the
Commission is not approving the draft bad debt policy submitted by the Petitioner in these
proceedings and will take a view on the same separately. The Commission, therefore, directs the
Petitioner to submit the audit report of receivables identifying and classifying the same in detail
within 6 months from the date of this Order. The Commission shall consider writing off of bad
debts for FY 2018-19 upon submission of the same at the time of truing up of FY 2018-19.

4.11.13Non-Tariff Income
The Petitioner has proposed non-tariff income of Rs. 155.26 Crore for FY 2018-19. In absence
of any yardstick for estimating the non-tariff income of the Petitioner, the Commission
provisionally accepts the same for FY 2018-19. The same shall, however, be Trued up based on the
actual audited accounts for the year.
4.11.14 Adjustment of revenue from Free Power
The Petitioner in its Petition has submitted that 75% of the cross-subsidy in respect of BPL/
PTW consumers has been adjusted from the cost of free power and the impact of the same has been
passed on to the subsidizing categories, i.e. HT-Industrial & Non-domestic. An amount of Rs. 191.14
Crore has been estimated and the same has been reduced from the Gross ARR for FY 2018-19.
The Commission in this regard asked the Petitioner to submit the following:
a) Reasons for proposing the adjustment
b) Regulation under which it has proposed this adjustment
c) Whether State Government has accorded the approval. If yes, documentary evidence
for such approval.
d) If approval has not been accorded, submit revised ARR and Tariff Proposal excusing
such adjustment.
The Petitioner in response to the above submitted that the mandate of Electricity Act, 2003
and Tariff Policy is to reduce the level of cross-subsidy. With a view to reduce the level of cross-
subsidy the adjustment was proposed. The Petitioner further submitted that it has proposed the
said adjustment under Regulation 16(5)(b) which states as follows:
“A statement of proposed tariffs containing full details of calculation of any subsidy received, due or
assumed to be due from the State Government, the purpose consumers to whom it is directed, and
showing how the subsidy is reflected in the current and proposed tariff applicable to those
consumers.”
With regards to having approval of GoU, the Petitioner stated that the ARR and Tariff
Petition is approved by Board of Directors (BoD) of the Petitioner Company and the Government
Representatives (Principal Secretary/Secretary/Additional Secretary) are members of BoD. The

2018-19
Petitioner, however, submitted that no written communication have been received so far from GoU.
The Commission has gone through the submissions of the Petitioner and is of the view that
the revenue from free power belongs to the Government and, therefore, the Petitioner cannot
propose to adjust the same without the written consent from GoU. In this regard, the Commission
vide its letter dated January 10, 2018 had asked the State Government if it intends to allow
utilisation of revenue from free power as proposed by UPCL. However, till the date of the Order no
communication has been received from the State Government. The Commission has, therefore, not
considered proposed adjustment of the revenue from free power for reduction of cross subsidy. The
Commission also directs the Petitioner to refrain from such financial engineering in its future
proposals in the absence of firm assurances/commitments from the State Government which
results in misleading all the stakeholders.
4.11.15Treatment of past year adjustments
The Commission in its MYT Order dated April 05, 2016 had approved the recovery of past
year provisioned amount on account of material cost variance and write off of liabilities towards
cost of power purchase. The Commission had determined the past year adjustments of Rs. 522.91
Crore with carrying cost to be returned by the Petitioner. The Commission further adjusted the true
up of capital related expenses of the past years leaving behind Rs. 366.04 Crore to be refunded in
three equal instalments out of which an amount of Rs. 122.01 Crore and Rs. 139.16 Crore was
adjusted in the MYT Order in FY 2016-17 and APR Order dated March 29, 2017 and balance Rs.
139.16 Crore along with carrying cost amounting to Rs. 158.71 Crore have to be passed on in FY
2018-19. The amount to be adjusted on account of the same is as shown in the Table below:
Table 4.51: Past Year Adjustment approved for FY 2018-19 (Rs. Crore)
Past Year Adjustments Revised Estimate
Opening for FY 2017-18 278.32
Addition (Adjustment) (139.16)
Closing 158.71
Interest rate (as approved for WC borrowings) 14.05%
Carrying Cost 19.55
Final Closing Gap to be adjusted in FY 2018-19 158.71
Further, as discussed in Chapter 3 of this Order the Commission is adjusting excess amount
towards cost of free power allowed from FY 2011-12 to FY 2015-16 to the Petitioner amounting to
Rs. 100.74 Crore from the ARR of FY 2018-19.

4.11.16Revenue Requirement for FY 2018-19
Based on the above, the Revenue Requirement approved by the Commission for FY 2018-19
is as shown in the Table below:
Table 4.52: Revenue Requirement approved by the Commission for FY 2018-19

(Rs. Crore)
S. No. Particulars Claimed by UPCL Approved
1. Power Purchase Cost 5161.55 4932.43
2. Adjustment of Free Power (Excess Allowed) (100.74)
3 Truing up of UJVN Ltd. (47.09)
4. Transmission Charges
PGCIL 412.68 388.08
PTCUL 192.46
342.91
5. SLDC Charges 16.84
6. Interest on Loan 181.39 138.47
7. Depreciation 144.87 142.42
8. O&M expenses 647.68 505.57
9. Interest on Working Capital 26.06 0.00
10. Return on Equity 93.38 78.24
11. Aggregate Revenue Requirement 7010.52 6246.69
12. Less: Non-Tariff Income 155.26 155.26
13. Add: True up impact Gap/(surplus) 417.12 64.78
14. Free Power Adjsutment – Cross Subsidy (191.14)
15. Previous year adjustment (158.71) (158.71)
16. Net Revenue Requirement 6922.53 5997.50
4.11.17Revenue at Existing Tariff
The Petitioner has projected the revenue of Rs. 6102.24 Crore for FY 2018-19 at the approved
Tariff.
By applying the approved Tariff for FY 2017-18 in Tariff Order dated 29.03.2017, the
Commission has estimated the total consumer category wise revenue for FY 2018-19 as Rs. 5859.95
Crore.
The revenue at existing Tariff as proposed by the Petitioner and estimated by the
Commission is shown in the Table given below:

2018-19
Table 4.53: Revenue for FY 2018-19 at existing Tariff (Rs. Crore)

S. Consumer Proposed by the Petitioner Estimated by the Commission
No. Category Sales (MU) Revenue Average Sales Revenue Average
(Rs. Crore) Billing Rate (MU) (Rs. Crore) Billing Rate
(Rs./kWh) (Rs./kWh)
1. RTS-1: Domestic 2,986 1,161.53 3.89 2950.13 1122.98 3.81
RTS-2: Non-
2. 1,319 787.42 5.97 1319.74 751.22 5.69
Domestic
RTS-3: Public
3. 56 30.56 5.47 52.63 27.22 5.17
Lamps
RTS-4: Private
4. 406 74.54 1.84 368.60 64.40 1.75
Tube Wells
RTS-5:
Government
5. 171 92.42 5.41 161.23 82.76 5.13
Irrigation
Systems
RTS-6: Public
6. 410 220.14 5.37 398.41 200.88 5.04
Waterorks
7. RTS-7: Industry 6,366 3,619.69 5.69 6392.74 3486.85 5.45
LT Industry 351 197.96 5.64 329.92 179.70 5.45
HT Industry 6,015 3,421.74 5.69 6062.82 3307.15 5.45
RTS-8: Mixed
8. 185 98.02 5.29 186.78 94.15 5.04
Load
RTS-9: Railway
9. 31 17.91 5.70 23.45 12.36 5.27
Traction
Revenue from
34.76 17.13 4.93
Incremental Sales
Total 11930 6,102.24 5.11 11888.48 5859.95 4.93
4.11.18Revenue Gap for FY 2018-19 at existing Tariff
Based on the net revenue requirement of Rs. 6922.53 Crore (including the proposed True up
amount for FY 2016-17) and revenue at existing Tariff of Rs. 6102.24 Crore, the Petitioner has
proposed the revenue gap of Rs. 820.29 Crore to be recovered by way of proposed Tariff for FY
2018-19.
Considering the net revenue requirement of Rs. 5997.50 Crore and revenue at existing Tariff
of Rs. 5859.95 Crore, the Commission has approved the revenue gap of Rs. 137.55 Crore for FY 2018-
19. The Commission has approved the Retail Tariff for FY 2018-19 to cover the approved revenue
gap of Rs. 137.55 Crore.The revenue gap for FY 2018-19 proposed by the Petitioner and approved by
the Commission is as shown in the Table given below:

Table 4.54: Revenue Gap for FY 2018-19 (Rs. Crore)

Particulars Proposed by the Petitioner Approved
Net Revenue Requirement 6922.53 5997.50
Revenue at existing Tariff 6102.24 5859.95
Revenue Gap 820.29 137.55

5. Tariff Rationalisation, Tariff Design and Related Issues
5.1 Tariff Rationalisation and Tariff Design for FY 2018-19
5.1.1 General
In Chapter 4 of this Order, it has been concluded that the revenue projected to be earned by
UPCL during FY 2018-19 at approved tariffs vide Tariff Order dated 29.03.2017 will be Rs. 5859.95
Crore. Against this, the ARR approved by the Commission for FY 2018-19 including gap and
surplus on account of truing up of previous years works out to Rs. 5997.50 Crore, leaving a total gap
of Rs. 137.55 Crore. In view of the objections received and the Petitioner’s submissions, the
Commission considers it appropriate to first take a view on the tariff rationalisation measures
suggested by the Petitioner and the concerns voiced by other stakeholders.
5.1.2 Petitioner’s Proposals
The Petitioner submitted that the tariff proposal has been formulated with an attempt to
keep the impact on the consumers to the minimum possible extent and at the same time not defer a
large portion of recovery on the tariff for the coming years. The Petitioner further submitted that
Section 61(g) of the Electricity Act, 2003 states that the appropriate Commission should be guided
by the objective that the tariff progressively reflects the efficient and prudent cost of supply of
electricity.
The Petitioner further submitted that the Additional Energy Charge (AEC) as approved by
the Commission vide its Review Order dated August 03, 2017 on True-up for FY 2015-16, Annual
Performance Review for FY 2016-17 and Annual Revenue Requirement for FY 2017-18 has been
considered to be subsumed in the proposed increase in fixed and energy charges and, therefore, has
not been proposed separately.
Some of the key alterations proposed by the Petitioner in the retail tariffs for FY 2018-19 are
as follows:
5.1.2.1 Loss Based Additional Surcharge
The Petitioner submitted that the Commission in the Tariff Order for FY 2005-06 had
introduced the concept of ‘Loss based Additional Surcharge’ to be applied to consumers based on

the loss in the specific zone/ sub-division. A concept paper was also issued by the Commission
subsequently in this regard. The Petitioner submitted that it has undertaken several measures in the
past which has resulted in reducing its distribution losses to 16.68% in FY 2016-17. The Petitioner
also submitted the Division wise loss levels. It is observed that losses in some of the divisions/sub-
divisions are still very high than the reasonable level of losses. The Petitioner, therefore, requested
the Commission to reconsider its approach for introduction of Loss based Additional Surcharge in
such divisions which would help in discouraging pilferage activities by the consumers in the
respective areas.
5.1.2.2 Disconnection for consumers exceeding 110% of their Contracted Load/Demand

consecutively in three billing cycles
The Petitioner has proposed disconnection of consumers exceeding 110% of their contracted
load / demand consecutively in three billing cycles in a financial year. The Petitioner submitted that
it has been proposed in view of the fact that such excess demand drawn by the consumer is
unplanned on the part of the distribution licensee and causes loss/ damage to the distribution
system. The Petitioner further proposed that these consumers shall be reconnected once they
establish reduction in their load or apply for enhancement of their connected load/ demand.
5.1.2.3 Prepaid metering
The Petitioner submitted the Tariff proposal for prepaid metering. The salient features of
Prepaid Metering proposed by Petitioner are as follows:
1. The option of Pre-paid metering shall be available for all categories of consumers upto 25
kW load under LT category. Prepaid Metering shall be mandatory for new Temporary
LT connections, for Advertisements/Hoardings and for Government connections upto
25 kW.
2. There shall be a minimum recharge of Rs. 100 and the maximum limit of recharge shall
be Rs. 15,000 for both single phase and three phase connections. Validity of the recharge
shall be continued till the amount is available in the account of the consumer. Any
recharge shall be allowed only when the 20 digit special meter reading code shall be
made available by the consumer.

5. Tariff Rationalsation, Tariff Design and Related Issues
3. As regards the charges for testing of meter, the Petitioner shall recover the amount as
approved by the Commission under Schedule of Miscellaneous Charges directly from
such prepaid consumers as is done for postpaid consumers and shall not be charged
from the recharge amount.
4. In case, the consumer opting for Prepaid Metering have outstanding arrears, the
Petitioner shall adjust 20% of the past arrears or 50% of the recharge amount, whichever
is higher from the recharge voucher, subject to the maximum of the outstanding arrears.
Further, the maximum limit of recharge as mentioned above, shall not be applicable in
case of consumers having outstanding arrears and accordingly, such consumers having
past arrears will have to take minimum recharge of more than 20% of the outstanding
arrears.
5. The Petitioner shall make necessary provisions to provide friendly credit hours/limit to
the consumers, in order to ensure uninterrupted supply to the consumer in the event of
expiry of the balance during non-working hours, i.e. night time or during holiday, so as
to provide reasonable time to the consumer to procure the recharge voucher at the next
possible working hours or working day. However, the charges for the electricity
consumed between expiry of balance during non-working hours and subsequent
recharge voucher shall be adjusted from the recharge voucher.
6. All the Prepaid meters will be provided with an alarm to indicate low credit.
7. As per the guiding principles and Section 47(5) of the Electricity Act, 2003, the Petitioner
shall not charge any security deposit as is required in post-paid connections but price
equivalent to the material cost, i.e. cost of meter and associated equipment’s shall be
charged as material security which shall be returned after adjusting for the depreciation
at the time of permanent disconnection. The material security deposit for FY 2018-19
shall be Rs. 5000/- for single phase connection and Rs 10,000/- for three phase
connection.
8. The consumer shall be allowed only one transfer from postpaid to prepaid or otherwise
in a financial year.
9. Minimum Consumption Guarantee (MCG), voltage rebate/surcharge, low power factor
surcharge and excess load penalty shall not be applicable for prepaid connections.

10. A rebate of 4% of Energy Charges for Domestic Category and 3% of Energy Charges for
other categories shall be applicable as per tariff schedule for the consumers availing this
scheme and the rebate shall only be applicable after installation and operationalization of
Prepaid meters.
11. No rebate shall be applicable on Part (A) of RTS-10, i.e. Temporary Supply for
Illumination & Public Address Needs.
12. Fixed charge in respect of other domestic consumers (para 2 (1.2) of the RTS -1) shall be
Rs. 70/kW/month.
13. The solar water heater rebate shall be adjusted as follows:-
a. The rebate for first month of implementation of prepaid metering scheme shall be
credited immediately on the first recharge. Thereafter, rebate shall be credited on
monthly basis if recharge is done every month.
b. In case recharge is not being done on monthly basis, then based on the capacity of
Solar Water Heater installed by the consumer, solar water heater rebate would be
credited for all the past months for which the rebate was due either at the time of
recharge or when the consumer approaches UPCL.
5.1.3 Commission’s Views on Tariff Rationalisation Measures
The Commission believes that tariff rationalisation is a dynamic and ongoing process and is
essential to accommodate the socio-economic and technological changes taking place in the system
over a period of time.
The following Sections discuss the tariff rationalisation measures suggested by the
Petitioner, Respondents, and the Commission’s view on the same.
5.1.3.1 Loss Based Additional Surcharge
The Petitioner itself has mentioned that it has undertaken several measures in the past which
has resulted in reducing its distribution losses to 16.68% in FY 2016-17. The Petitioner requested the
Commission for introduction of Loss based Additional Surcharge in such divisions where the losses
are higher as the same would help in discouraging pilferage activities by the consumers in the
respective areas.

As discussed in subsequent Chapter, the Petitioner’s performance on the issues related to

metering and billing needs to be substantially improved and the Petitioner has not been complying
with the directions issued by the Commission. The Commission would like to highlight here that
the Petitioner has only proposed the concept in its Petition and has not given any concrete proposal
with loss based additional surcharge to be levied alongwith revenue impact etc.
There have been responses from the consumers in this regard that why should a honest
consumer be loaded with the burden of losses of other consumers who are engaged in such
malpractices. The Commission agrees with such views of the consumers. It is the duty of the
licensee to control theft of electricity and it cannot shift its duty to the consumers. Besides, even if
loss based additional surcharge is introduced, consumer who was indulging in theft of electricity
would continue to do so rather they will have all the more incentive to steal electricity as it would
save them in monetary terms. While on the flip side such mechanism would burden the honest
consumers who pay their bills on time and do not indulge in such practices including theft of
electricity. Hence, the Commission is of the view that at overall loss level of 16.68% it would not be
appropriate to burden the honest consumers of divisions having higher loss levels on account of
inefficiencies of the Petitioner. The Commission has, therefore, not approved any loss based
additional surcharge.
5.1.3.2 Disconnection for consumers exceeding 110% of their Contracted Load/Demand

consecutively in three billing cycles.
The Petitioner has proposed disconnection of consumers exceeding 110% of their contracted
load / demand consecutively in three billing cycles in a financial year. In this regard, several
stakeholders have submitted that this is the issue related to “Supply Code” and not relevant to the
current tariff determination proceedings. Deliberations were also held on this issue in SAC meeting
during which the stakeholders submitted that the Petitioner is mixing up Supply Code issue with
the current tariff determination matter. The Commission agrees with the views of the stakeholder
that this issue is related to the Supply Code and hence, without going into the merit the
Commission has not considered the request of the Petitioner in these tariff proceeding on grounds
of maintainability.

5.1.3.3 Merger of Slabs for levying Fixed Charges for Domestic Category
The Commission in its Tariff Order for FY 2015-16 issued on Apri1 11, 2015 after following
the due consultation process by inviting comments on in-house paper decided to specify the fixed
charges for domestic consumers linked to the consumption and approved the differential fixed
charges linked to the consumption as follows:
 For Consumption upto first 100 units/month

 For Consumption between 101-200 units/month
 For Consumption between 401 -500 units/month
 For Consumption above 500 units/month
As per the existing slab structure for Domestic Category, there are 6 slabs for levying the
fixed charges linked to consumption, while for energy charges, there are only 4 slabs. The
Commission as a one more step towards tariff rationalisation measure and simplifying tariff
structure has decided to reduce the slabs for levying fixed charges for Domestic category from 6
slabs to 4 slabs by aligning to the same slabs as applicable for energy charges. Accordingly, the
differential fixed charges linked to consumption shall be as per the following slabs:
 For Consumption upto first 100 units/month

 For Consumption above 400 units/month
5.1.3.4 Merger of three categories RTS-3: Public Lamp, RTS-5: Government Irrigation System and
RTS-6: Public Water Works
The Commission in its Tariff Order dated March 29, 2017 had changed the tariff for RTS-3
and RTS-5 Category from kWh based tariff to kVAh based tariff considering the Petitioner’s
proposal. Currently, the tariffs for these three categories, i.e. RTS-3, RTS-5 and RTS-6 is kVAh based
tariff and further the tariff of all these three categories is generally designed by the Commission to
keep it close to the Average Cost of Supply. The Commission as a step further towards tariff
rationalisation and simplifying tariff structure has decided to merge the existing three categories,

i.e. RTS-3: Public Lamp, RTS-5: Government Irrigation System and RTS-6: Public Water Works into
a single category “Government Public Utilities” Category. The tariff designed for this category is
discussed in subsequent paras of the Order.
5.1.3.5 Change in Consumption level for BPL/Lifeline Domestic Consumers
As per the current Tariff Schedule, lower tariff is specified for BPL/Lifeline Domestic
Consumers, i.e. Consumers below Poverty Line and Kutir Jyoti having load upto 1 kW and
consumption upto 30 units per month. Some of the stakeholders requested to increase the
consumption level of 30 units per month to 100 units per month for this category. The Commission
has analysed the average consumption of this category which works out to around 55 units per
month. The consumption level of 30 units per month was specified in the Tariff Order for FY 2003-
04 and it has not been revised after FY 2003-04. Considering the facts, that average consumption of
this category works out to around 55 units per month and consumption level has not been revised
for long time, the Commission has decided to increase the consumption level from existing 30 units
per month to 60 units per month. In case the consumption of consumer in this category exceeds 60
units per month, the tariff applicable for other domestic consumers shall be applicable.
5.1.3.6 Fixed Charges, Minimum charges and Minimum Consumption Guarantee
It is a well-accepted economic principle that the fixed costs of the Utility should be
recovered to a certain extent through fixed charges to ensure revenue stability. At the same time, the
Commission recognises that if the entire fixed cost is recovered through fixed charges, then the
utility shall have no incentive to be concerned about the sales and, hence, quality of supply may
suffer. Historically, the recovery of fixed costs has been done through a mix of minimum charges
and fixed charges. Levy of Minimum Consumption Guarantee Charges (MCG) is a way of ensuring
minimum revenue to the utility from the consumers, however, if the consumption exceeds the
specified units, then no MCG charges are levied on the consumers and the entire charges are
recovered by the utility through energy/fixed charges.
The fixed charge component reflecting the fixed cost of providing the service to the
consumer and the energy charge component reflecting the cost of energy actually consumed should
ideally be taken in the two-part tariff structure.

Section 45(3) of the Electricity Act, 2003 also provides for levy of fixed charges. The relevant
Section is reproduced below:
“The charges for electricity supplied by a distribution licensee may include:
(a) a fixed charge in addition to the charge for the actual electricity supplied;
...”
Further, the licensee is incurring fixed cost directly attributable to individual consumers
such as meter reading, bill preparation, bill distribution and collection, which should ideally be
allocated to and recovered from each consumer. One of the guiding factors mentioned in Section 61
of the Electricity Act, 2003 for specifying terms and conditions of tariffs is that the tariff has to be
gradually cost reflective. Considering that levy of higher fixed charges should not impact the
consumers adversely, the Commission, in its Tariff Order dated March 18, 2008, introduced a
nominal fixed charge for all the categories as a progression towards designing a two part tariff
structure linked to the cost structure. Further, in its subsequent Tariff Orders for FY 2009-10 to FY
2017-18, considering the level of proportion of fixed costs as a percentage of total costs of UPCL and
level of revenue recovery from fixed charges, the Commission had marginally increased the fixed
charges for most of the categories to increase the revenue recovery from fixed charges and at the
same time avoiding tariff shock to any consumer category.
The Commission in its Tariff Order dated March 18, 2008 had mentioned that ideally, the
fixed charges should be levied on the basis of contracted/sanctioned load for all the categories.
However, for domestic category, considering the data on sanctioned load which had number of
consumers having contracted load in fractions (< 1 kW) and also considering the quality of metering
and billing data, the Commission introduced the fixed charges on per connection basis. The
Commission in its Tariff Order dated October 23, 2009, specified different fixed charges on per
connection basis for domestic consumers having contracted/sanctioned load upto 4 kW and
consumers having contracted/sanctioned load above 4 kW. Further, during the tariff proceedings
for FY 2015-16, the Commission floated an in-house paper on the issue of Fixed Charges based on
consumption and the Commission after detailed deliberations in its Order dated April 11, 2015
introduced consumption based fixed charges for domestic consumers.

At the approved tariffs, the recovery from Fixed Charges from the consumers for FY 2018-19
is estimated to be around 13% against the total fixed cost incidence on the Petitioner of about 37% of
the licencee’s ARR for FY 2018-19.
The Commission in its Tariff Order dated March 18, 2008 had re-introduced the Minimum
Consumption Guarantee (MCG) Charges for the industrial category and in its Tariff Order dated
October 23, 2009 re-introduced the Minimum Consumption Guarantee (MCG) Charges for the Non-
Domestic Category. The Commission in its Order dated April 11, 2012 had introduced MCG for
metered PTW category also.
Some of the stakeholders submitted that the MCG burdens the consumers with additional
charges and results in wasteful consumption of electricity. They also represented that the MCG on
seasonal industry should be abolished as it encourages unnecessary wastage of electricity by
consumers during off season. Some of the stakeholders also represented that due to demand supply
shortage situation, load shedding is being carried out by UPCL and, hence, MCG should either be
abolished or reduced. Some of the stakeholders also submitted that due to MCG, they are either
forced to consume/waste electricity during off season or are penalized to pay the energy charges
for electricity not consumed by them during off season which is against the principles of energy
efficiency.
The Commission in its Order dated April 11, 2015 taking into cognisance the various
representations received for reduction in MCG and also in line with its plan for gradual elimination
of MCG reduced the MCG to 50 units/kWh/month for all those Non-Domestic sub-categories on
which MCG were earlier specified as 60 units/kW/month. For HT industries the same was revised
to 100 kVAh/kVA/month from the earlier level of 110 kVAh/kVA/month. For Atta chakkis, the
MCG was revised to 30 units/kW/month from the earlier level of 40 units/kW/month. For PTW
category the MCG was reduced to 60 units/BHP/month from earlier level of 70 units/BHP/month.
The Commission in its Tariff Order dated March 18, 2008 had mentioned that it may review
the continuation of the MCG charges in subsequent Tariff Orders. The Commission is of the view
that Fixed/Demand Charges are now applicable for all the categories. The basic objective of
Fixed/Demand Charges as well as MCG charges is to ensure certain level of revenue to the Utility
even when the consumer is not consuming any electricity. Considering the progress towards loss
reduction and improvements achieved by UPCL with respect to metering and billing issues and

suggestions of various stakeholders, the Commission as a step towards tariff rationalisation

measure and simplifying tariff structure has decided to abolish the levy of MCG charges for entire
Industrial category and for Non-Domestic consumers. In any case the total additional recovery from
MCG in a year is only about Rs. 20 Crore and hence, it will not have any substantial impact on the
Petitioner.
5.1.3.7 Continuous Supply Surcharge
The Petitioner has proposed to continue the continuous supply surcharge of 15% for
industries opting for continuous supply.
The Commission, in its Tariff Order dated October 23, 2009, had approved continuous
supply surcharge @ 15% of the Energy Charge for consumers opting for supply during restricted
hours (continuous). Further, all the consumers had an option to opt for continuous supply
irrespective of whether they were on dedicated independent feeder or on mixed feeder. In
accordance with the above provision, even if a single consumer in mixed feeder opted for
continuous supply, its benefit got extended to all the consumers on that mixed feeder. This was a
sort of discrimination amongst the consumers who had opted for continuous supply on mixed
feeder and those who had not opted for continuous supply on mixed feeder as both enjoyed the
benefit of continuous supply irrespective of the fact that they were paying any continuous supply
surcharge or not. On the other hand, if the supply on the mixed feeder was required to be cut
during rostering, the supply of continuous supply consumer also got unintentionally cut.
The Commission in order to rectify this anomaly had taken a view in its Tariff Order dated
April 10, 2010 that the option of continuous supply should be made available only to consumers
who are connected on a dedicated independent feeder or industrial feeder provided that all the
industrial consumers on such feeder opt for continuous supply option. The Commission was also of
the view that considering the supply shortage position, this option was to be provided only to the
continuous process industries requiring continuous supply due to continuous nature of their
process. In this connection, the Commission would like to refer to Regulation 3(2) of UERC (Release
of new HT & EHT Connections, Enhancement and Reduction of Loads) Regulations, 2008, which
provides that loads for all HT consumers having continuous processes, irrespective of load applied
for, shall be released through independent feeder only. The Commission in its Tariff Order dated
April 10, 2010 had, therefore, decided that with effect from May 1, 2010, the option of continuous

supply shall remain available only to continuous process industries operating twenty four hours a
day and for seven days in a week without any weekly off. Further, this option was only to be
available to continuous process industries connected through an independent feeder or industrial
feeder provided that all the industrial consumers on such feeder opted for continuous supply
option and for availing such an option, they were required to pay 15% extra energy charges at
revised tariff with effect from May 1, 2010 or from the date of connection, whichever is later till 31st
March, 2011 irrespective of actual period of continuous supply option. Further, the Commission in
its Tariff Order dated April 10, 2010 also decided that the load shedding would be applicable for all
the consumer categories except continuous process industries availing continuous supply option
and, hence, the Commission abolished the mechanism of allowing utilisation of power upto 15% of
the contracted load by industrial consumers who did not opt for continuous supply.
In its Tariff Order for FY 2011-12 dated May 24, 2011, Tariff Order for FY 2012-13 dated April
11, 2012, MYT Order dated May 06, 2013 and APR Order dated April 10, 2014 the Commission
decided to continue with the same provisions for Continuous Supply as approved in its Order
dated April 10, 2010.
The Commission in its ARR/Tariff Order dated April 11, 2015 after detailed deliberations on
the issue after floating the in-house paper extended the option of continuous supply to non-
continuous process industries in addition to the continuous process industries.
In these tariff proceedings, the Commission has received mixed responses from various
stakeholders. Some of the industries submitted that the continuous supply surcharge be reduced.
The Commission would like to clarify that the State of Uttarakhand is still facing power
shortage and UPCL is procuring short term power from market to meet the demand. Even for FY
2018-19, the Commission has estimated a deficit of about 614.81 MU in winter months during
November to March in the requirement of UPCL which is of substantial nature. The Commission
has estimated a surplus of about 917.56 MU during May, 2018 to October, 2018 in the requirement
of UPCL for FY 2018-19 which would be banked with other States to offset the deficit during winter
months. Hence, the Commission does not find any reason to abolish the continuous supply
surcharge altogether as during winters UPCL is still having deficit. However, the deficit in winter
months has reduced as compared to previous years (deficit considered by the Commission in winter
months of FY 2017-18 was 822 MU). Considering the fact that the deficit has reduced as compared

to previous year and views of stakeholders, the Commission has decided to reduce the continuous
supply surcharge from 15% of energy charges to 10% of energy charges. The Commission will
review the same once the aforesaid deficit in UPCL’s requirement is wiped off.
Further, some of the stakeholders submitted that UPCL is also charging continuous supply
surcharge on power availed through open access and has requested the Commission to exempt
continuous supply surcharge on the same. In this regard, the Commission had approved
continuous supply surcharge in its Tariff Order dated October 23, 2009 to the industrial consumers
of UPCL seeking continuous power supply option and it was understood that the Petitioner for
making available continuous supply of power to such industry consumers would resort to
contracting of requisite capacity with the generating stations or short term procurement through
traders/Exchange or through UI route. However, when such industry consumers who has opted for
continuous supply option sources power under open-access then UPCL is free from its obligations
to provide uninterrupted power by procuring the same on short term basis. Moreover, while
projecting the sales/consumption for industrial category, the quantum of power drawn by
industrial consumers through open access is already reduced meaning thereby that there is
absolutely no cost incidence on the Petitioner w.r.t. power purchase cost on account of such
consumers drawing power under open access. Hence, there is a merit on the representations of the
stakeholders. Accordingly, the Commission makes it explicitly clear not to charge continuous
supply surcharge on power sourced by an industrial consumers under open access.
The option of continuous supply shall only be available to continuous and non-continuous
industries connected on an independent feeder or industrial feeder provided that all the industrial
consumers on such feeder opt for continuous supply option. The existing non-continuous process
industrial consumers opting for continuous supply shall pay 10% extra energy charges with effect
from April 01, 2018 or in case of new consumers from the date of connection, till March 31, 2019
irrespective of actual period of continuous supply. However, in case of re-arrangement of supply
through independent feeder, the Continuous Supply Surcharge shall be applicable from the date of
energisation of aforesaid independent feeder till March 31, 2019, irrespective of actual period of
continuous supply option.

In this regard, the Commission would like to clarify certain key issues, pertaining to
applicability conditions for existing and new continuous and non-continuous supply consumers in
order to avoid any misinterpretation of the conditions, and the same are discussed as under:
 Consumers who have opted for Continuous supply shall continue to remain
Continuous Supply Consumers and they need not to apply again for seeking continuous
supply option. Such consumers shall pay 10% extra energy charges, in addition to the
energy charges approved, w.e.f. April 01, 2018 till March 31, 2019. However, in case of
any pending dispute with UPCL in the matter of continuous supply on certain feeders,
those consumers will have to apply afresh, for availing the facility of continuous supply
by April 30, 2018.
 The new applicants for continuous supply of power (including those who are applying
afresh as per above) can apply for seeking the continuous supply option at any time
during the year. However, continuous supply surcharge for such existing consumers
shall be applicable with effect from May 01, 2018 till March 31, 2019. UPCL shall provide
the facility of continuous supply within 7 days from the date of application, subject to
fulfilment of Conditions of Supply as mentioned in Clause 6 under Tariff Schedule of
RTS-5. However, in case of re-arrangement of supply through independent feeder,
UPCL shall provide the facility of continuous supply from the date of completion of
work of independent feeder subject to fulfilment of Conditions of Supply and the
continuous supply surcharge on such consumers shall be applicable from the date of
energisation of aforesaid independent feeder till March 31, 2019, irrespective of actual
period of continuous supply option.
 The existing consumers availing continuous supply option, who wish to discontinue the
continuous supply option granted to them earlier, will have to communicate, in writing,
to UPCL latest by April 30, 2018 and they shall continue to pay continuous supply
surcharge alongwith the tariff approved in this Order till April 30, 2018. Further, in this
regard, if due to withdrawal by one consumer from availing continuous supply option
on a particular feeder, the status of other continuous supply consumers in that feeder is
affected, then UPCL shall inform all the affected consumers in writing, well in advance.

 UPCL shall not change the status of a continuous supply feeder to a non-continuous
supply feeder.
 UPCL/PTCUL shall take up augmentation, maintenance and overhauling works on top
priority, specially in the sub-stations where circuit breakers, other equipments, etc. are
in dilapidated condition and, thereby, shall ensure minimisation of interruptions of the
continuous supply feeders.
 UPCL/PTCUL shall carry out periodical preventive maintenance of the feeders
supplying to continuous supply consumers. The licensees shall prepare preventive
maintenance schedule, in consultation with continuous supply consumers, well in
advance, so that such consumers can plan their operations, accordingly.
 Continuous supply surcharge shall not be applicable on power procured by industrial
consumers through open access.
5.1.3.8 Tariff Categorisation for HT Industries and Load Factor based Tariff
The Commission has considered the stakeholders/industries responses and observed that
some of the consumers have again raised the issue of load factor based tariff for HT Industries.
Some of the stakeholders submitted that the load factor based tariff for HT Industries is
discriminatory as well as against the provisions of the Act, Tariff Policy and the Commission’s
Tariff Regulations.
The Commission would like to highlight Section 62(3) of the Act, which empowers the
Appropriate Commission, while determining the tariff, to differentiate according to the consumer’s
load factor, power factor, voltage, total consumption of electricity etc. Section 62(3) of the Act is
reproduced below:
“The Appropriate Commission shall not, while determining the tariff under this Act, show undue
preference to any consumer of electricity but may differentiate according to the consumer's load
factor, power factor, voltage, total consumption of electricity during any specified period or the time
at which the supply is required or the geographical position of any area, the nature of supply and the
purpose for which the supply is required” (emphasis added).
Regulation 92(2) of UERC Tariff Regulations, 2015, specifically empowers the Commission
to design load factor based tariffs for any category of consumers and is reproduced below:

“The Commission, shall not, while determining the tariff, show undue preference to any consumer of
electricity but may differentiate according to consumer’s load factor, voltage, total consumption of
electricity during any specified period or time at which the supply is required or the geographical
position of any area, the nature of supply and the purpose for which the supply is required. “
The Commission in its Order dated April 11, 2015 after detailed deliberations in response to
the in-house paper had modified the slabs for load factor based tariff from three slabs to two slabs.
Further, as discussed in Chapter 2 of the Order, some of the stakeholders submitted that the
principle applied for the categorisation of the industry on the basis of load factor should be on the
principle of higher the load factor, lower the tariff as prevalent in other States. They further
expressed that the higher load factor implies that the consumer consumes nearly as much as it has
contracted for and has paid the demand charges accordingly, and the Utility stands to benefit by
higher load factor because the utility is able to sell more electricity which it has arranged for
meeting the demand of the consumer. They further opined that if the load factor is lower, the utility
would find itself having contracted more power from generating companies than it would be able
to sell to the consumers and in this process may suffer loss.
The Commission does not agree with the views of the stakeholders that higher load factor
implies that the Utility stands to benefit from selling more electricity which it has arranged for
meeting the demand of the consumer and load incidence on the system matches with the contracted
demand/load of the consumers of the State. The Commission would like to clarify that there is
diversity in time of usage of electricity by different consumers and, hence, the actual simultaneous
maximum demand of all the consumers put together shall always be less than the summation of
their contracted loads. Further, nowhere, the Utility makes the power purchase arrangement
equivalent to the contracted demand of its consumers. Further, increase or decrease of the
contracted load, and/or, the load factor, by consumer does not actually influence the consumption
pattern of consumers including diversity factor and, hence, the actual simultaneous maximum
demand is the basis for contracting power from different sources by the licensee rather than the
contracted load/load factor of the consumers. Further, the utilisation of the contracted capacity
from firm sources by UPCL for State consumption is more than 90% and balance surplus the
Petitioner uses for Banking during summer/monsoon months in order to take it back during winter
months when it has apparent deficit supply vis-a-vis demand. With the increase in load factor of

consumers, the energy requirement of the Utility will further increase, and the Petitioner will be left
with no surplus power to Bank during summer/monsoon months in order to take back during
deficit winter months. This inability of the Petitioner will require to purchase power at marginal
price i.e. the Petitioner will have to purchase costlier power to meet the increase in energy
requirement at higher load factor.
The two part tariff tends to encourage high consumption as the same reduces the effective
per unit composite rate. Accordingly, to correct this, tariff also needs to increase in a manner so as
to achieve a near uniform composite rate. To achieve this, demand and energy charges will have to
increase with every small increase in contracted demand or load utilization percentage. Although
theoretically possible, such an approach would make the tariffs too complex, incomprehensible and
will pose serious problems in implementation. There is, therefore, a trade-off between the simplicity
of the tariff structure and precision in correcting the above distortion. The Commission’s attempt
has been to strike a balance between the two by choosing a uniform rate of demand charge and
different rates of energy charges linked to the consumption levels represented by the Load Factor.
The Commission has avoided sharp increases in energy charges and has infact modified the three
slabs prevalent earlier to only two slabs in its previous Tariff Order dated April 11, 2015.
As had been illustrated by the Commission in its previous Tariff Orders in case of single
energy charge, without any load factor slabs, the effective tariff of an intended cross-subsidising
consumer goes down steeply with increasing load factor, thereby reducing the quantum of cross-
subsidy charged from it. After a threshold level of load factor, this structure leads to an undesirable
anomaly that the effective tariff becomes lower than the average Cost of Supply and the consumer
instead of being subsidising consumer becomes subsidised consumer. Thus, this structure apart
from leading to the above said anomaly is highly inequitable amongst the consumers of same
category with consumers having low load factor being loaded with much higher effective tariff and
making up for loss on account of lower effective tariff even below the average cost of supply paid
by high load factor consumers. Transition from subsidising consumer to subsidised consumer with
increasing load factor is not only incorrect but is also highly undesirable.
Some of the stakeholders represented that the tariff structure for HT Industries should also
be telescopic. In Uttarakhand, as the cross-subsidies are very low, the tariff needs to be corrected at
different load factors to ensure that steepness of the effective tariff curve does not reduce the cross-

subsidies to very low level or make them negative (subsidised). Further, there is a practical
difficulty in implementing slabs of tariffs for excess consumption only, due to ToD tariffs in vogue.
Apportionment of various slabs of consumption for different time slots would be very complicated
and would result in disputes between licensee and consumers as consumer would like to book
cheapest load factor slab (1st slab) against peak hour consumption and highest load factor slab (last
slab) against off-peak hour consumption. The licensee, on the other hand, would like to book first
load factor slab against off-peak consumption and the last load factor slab under peak hour
consumption. Thus, this structure would unnecessarily complicate the billing process and would
also lead to disputes. Due to these reasons, the Commission is not implementing telescopic slab
based tariff for HT industrial consumers.
The above reasoning can be easily explained by taking an example with the figures of
approved tariff (Demand Charges Rs. 320/kVA/month and Energy Charges in two slabs of Rs. 3.50
and 3.85/kVAh for FY 2016-17, where Average Cost of Supply was taken as Rs. 4.70/kWh and
average tariff from HT industrial consumers including ToD surcharge and rebate was designed to
be Rs. 5.17/kWh. It is evident that in case of single energy charge of Rs. 3.60/kVAh and demand
charge of Rs. 320/kVA/month, without any load factor slabs, the effective tariff of an intended
cross-subsidising consumer goes down steeply with increasing load factor, thereby reducing the
quantum of cross-subsidy charged from it. After a threshold level of load factor, this structure leads
to an undesirable anomaly that the effective tariff becomes lower than the average Cost of Supply
and the consumer instead of being subsidising consumer becomes subsidised consumer. Thus, this
structure apart from leading to the aforesaid anomaly is highly inequitable amongst the consumers
of the same category with consumers having low load factor being loaded with much higher
effective tariff and making up for loss on account of lower effective tariff even below average Cost
of Supply paid by high load factor consumers. The same applies to the condition if telescopic slab
energy charges for HT industries [Demand Charges: Rs. 320/kVA/monthly, Energy Charges: for
consumption upto LF 40%: Rs. 3.50/kVAh & for consumption exceeding LF 40%: Rs. 3.85 kVAh] are
considered the reduction in effective tariffs is almost similar to the case where single energy charges
are approved without any slab. The Table & Graph below shows these anomalies of consumers
getting cross-subsidised falling below average cost of supply after a particular load factor and wide
range of tariffs over different load factors with the single energy charge without any slab and

telescopic slabs. Increase of cross-subsidisation of HT industry with increasing load factor

(particularly > 45%) is not only incorrect but also highly undesirable.
Table 5.1: Effective Tariff & Cross-subsidy for HT Industry having contracted load 1 kVA
Subsidy %
(Rs./kVah)
Demand Charge (Rs./ kVA)
(Rs.kWh)
Effective
Amount
Supply
Charge
Cost of
Energy
Tariff
Cross
Total
Consumption (kVAh)
Load Factor
Rs.3.60 /kVah
Rs.3.60/ kVah
Rs.3.60 /kVah
Rs.3.60/kVah
Single EC of
Single EC of
Single EC of
Single EC of
Telescopic
Telescopic
Telescopic
Telescopic
Approved
Approved
Approved
Approved
Rs./ kWh
Tariff
Tariff
Tariff
Tariff
Tariff
Tariff
Tariff
Tariff
(14)=(10/13)-1
(15)=(11/13)-1
(16)=(12/13)-1
(10)=(7)/(2x
(11)=(8)/(2x
(12)=(9)/(2x
(7)=(3)+ (4)
(8)=(3)+ (5)
(9)=(3)+(6)
0.9575)
0.9575)
0.9575)
-13
-1
-2
-3
-4
-5
-6
25% 180 320 648 630 630 968 950 950 5.62 5.51 5.51 4.70 19.50% 17.28% 17.28%
30% 216 320 778 756 756 1098 1076 1076 5.31 5.20 5.20 4.70 12.92% 10.69% 10.69%
35% 252 320 907 882 882 1227 1202 1202 5.09 4.98 4.98 4.70 8.21% 5.99% 5.99%
40% 288 320 1037 1008 1008 1357 1328 1328 4.92 4.82 4.82 4.70 4.69% 2.46% 2.46%
45% 324 320 1166 1147 1247 1486 1467 1567 4.79 4.73 5.05 4.70 1.94% 0.58% 7.50%
50% 360 320 1296 1285 1386 1616 1605 1706 4.69 4.66 4.95 4.70 -0.25% -0.92% 5.30%
55% 396 320 1426 1424 1525 1746 1744 1845 4.60 4.60 4.86 4.70 -2.05% -2.15% 3.51%
60% 432 320 1555 1562 1663 1875 1882 1983 4.53 4.55 4.79 4.70 -3.54% -3.17% 2.01%
65% 468 320 1685 1701 1802 2005 2021 2122 4.47 4.51 4.73 4.70 -4.81% -4.04% 0.74%
70% 504 320 1814 1840 1940 2134 2160 2260 4.42 4.48 4.68 4.70 -5.90% -4.78% -0.34%
75% 540 320 1944 1978 2079 2264 2298 2399 4.38 4.44 4.64 4.70 -6.84% -5.43% -1.28%
80% 576 320 2074 2117 2218 2394 2437 2538 4.34 4.42 4.60 4.70 -7.66% -5.99% -2.10%
85% 612 320 2203 2255 2356 2523 2575 2676 4.31 4.39 4.57 4.70 -8.39% -6.49% -2.83%
90% 648 320 2333 2394 2495 2653 2714 2814 4.28 4.37 4.54 4.70 -9.03% -6.93% -3.48%
95% 684 320 2462 2533 2633 2782 2853 2953 4.25 4.36 4.51 4.70 -9.61% -7.33% -4.05%
100% 720 320 2592 2671 2772 2912 2991 3092 4.22 4.34 4.49 4.70 -10.13% -7.68% -4.57%
Graph 1 : Effective HT Industrial Tariff

Hence, in view of the above, the Commission is continuing with the existing load factor
based tariff structure for HT Industry.
5.1.3.9 Time of Day Tariff
Regarding Time of Day Tariff, the stakeholders requested the following:
 Abolish the morning peak hours.

 Morning peak hours in winter season should be from 8 A.M. to 9:30 A.M. in place of
existing 6 A.M. to 9:30 A.M.
 The ToD charges should be at existing levels.
 The rebate of 10% for consumption during off-peak hours should be increased to
20%/25%.
The Commission in its Tariff Order for FY 2010-11 dated April 10, 2010 approved the peak
hour rate as 50% higher than the normal hour rate for Industrial Category. Further, in case of HT
industries, the Commission has specified the peak hour rate as 50% higher than the normal hour
rate applicable for highest load factor slab, i.e. energy charge for load factor above 50% for all the
HT industrial consumers. The Commission kept the rebate during off peak hours to 10% to
incentivise the shift in consumption from peak hours to off peak hours.
The Commission, in each of its tariff determination exercise, has been analysing the shift
from the peak hours to normal and off-peak as well as the consumption pattern during the peak
and off-peak hours in the State. The Commission has analysed the unrestricted load curves of
summer as well as the winter month to assess the consumption during peak hour period during
these months. The load curves for the days having highest peak load in the months of summer and
winter season, have been examined and the same are graphically presented below:

Chart 1: Load Curve for 10h January 2018 (MW) [Winter Month]
Morning Peak Demand – 2149 MW at 9.00 AM

Evening Peak Demand - 2070 MW at 8.00PM
Chart 2: Load Curve for 2th Feb 2018 (MW) [Winter Month]
Morning Peak Demand – 2134 MW at 8.00 AM

Evening Peak Demand – 1879 at 7.00 PM

Chart 3: Load Curve for 15th April, 2017 (MW) [Summer Month]
Peak Demand – 1917 MW at 8.00 PM

No Morning Peak
Chart 4: Load Curve for 18th May, 2017 (MW) [Summer Month]
Peak Demand – 1946 MW at 9.00 PM

No Morning Peak
It is observed from the above graphical presentations that during the winter season both
morning as well as evening peak demand exists in the State. Infact, in the months of January and
February, the morning peak demand has been found to be even more pre-dominant than the

evening peak demand. From Chart 1&2 illustrating the load curve for January 10, 2018 & February
02, 2018 respectively, it can be observed that the demand starts rising from 6.00 a.m. till it reaches
the peak at about 8.00 a.m. & then start falling around 9.00 a.m. in the morning & flattens by around
11.00 a.m. Hence, the request of the stakeholders regarding change in morning peak hours cannot
be accepted since it would defeat the demand side management through tariffs in vogue in the
State. Further, it is seen from above graphs that the overall system peak of Uttarakhand State during
the year is significantly observed in the morning hours also besides evening peak.
The Commission feels the need for DSM and having ToD tariff as a measure for ensuring
curtailment of morning as well as evening peaks. Considering all these aspects, the Commission in
the present Order is continuing with the existing Peak, Normal and Off Peak hour duration for ToD
metering slots and peak hour surcharge. Considering the views of various stakeholders and in
order to incentivise the consumers for shifting the demand from Peak hours to Off Peak hours, the
Commission has increased the off-peak hour rebate from existing level of 10% to 15% in energy
charges.
5.1.3.10 Prepaid metering
The Commission recognises that Prepaid Metering is expected to provide better services to
the consumers, improve and secure the cash flow of the Petitioner and also lead to reduction in
consumer grievance and dissatisfaction to the consumers. Hence, after detailed deliberations on the
proposals of the Petitioner, the Commission approves the following conditions for Pre-Paid
Metering:
a) The option of Pre-paid metering shall be available for all categories of consumers upto 25
kW load under LT category. Prepaid Metering shall be mandatory for new Temporary
LT connections, for Advertisements/Hoardings and for Government connections upto
25 kW.
b) There shall be a minimum recharge of Rs. 100 and the maximum limit of recharge shall
be Rs. 15,000 for both single phase and three phase connections. Validity of the recharge
shall be continued till the amount is available in the account of the consumer. Any
recharge shall be allowed only when the 20 digit special meter reading code shall be
made available by the consumer.

c) As regards the charging for testing of meter, the Petitioner shall recover the amount as
approved by the Commission under Schedule of Miscellaneous Charges directly from
such prepaid consumers as is done for postpaid consumers and shall not be charged
from the recharge amount.
d) The Petitioner shall issue an advertisement in the newspapers within 15 days of the issue
of this Order, briefly mentioning salient features of the Prepaid Metering Scheme for LT
consumers upto 25 kW to provide an option to the consumer to express their interest to
opt for the Prepaid metering scheme latest by June 15, 2018.
It may be noted that the objective of calling applications for Prepaid metering shall be
primarily for the purpose of estimation of the requirement of such meters based on the
demand of the Scheme. Based on the requests received from the consumers opting for
Prepaid metering, UPCL shall implement the Prepaid metering in a phased manner.
Further, the Petitioner may also allow prepaid metering services to the consumers who
could not submit their request within the stipulated time given in the advertisement and
opt for it subsequently.
e) The Petitioner is also directed to prepare a Salient Features of the Prepaid Metering
Scheme (in 1-2 pages) and circulate the same along with the bills of May, 2018 to all the
eligible consumers, i.e. LT consumers upto 25 kW, to facilitate wide circulation as well as
to provide salient features of the proposed mechanism of the Prepaid Metering Scheme.
f) In case, the consumer opting for Prepaid Metering have outstanding arrears, the
Petitioner shall adjust 20% of the past arrears or 50% of the recharge amount, whichever
is higher from the recharge voucher, subject to the maximum of the outstanding arrears.
Further, the maximum limit of recharge as mentioned above, shall not be applicable in
case of consumers having outstanding arrears and accordingly, such consumers having
past arrears will have to take minimum recharge of more than 20% of the outstanding
arrears.
g) The Petitioner shall make necessary provisions to provide friendly credit hours/limit to
the consumers, in order to ensure uninterrupted supply to the consumer in the event of
expiry of the balance during non-working hours, i.e. night time or during holiday, so as
to provide reasonable time to the consumer to procure the recharge voucher at the next
possible working hours or working day. However, the charges for the electricity

consumed between expiry of balance during non-working hours and subsequent

recharge voucher shall be adjusted from the recharge voucher.
h) All the Prepaid meters will be provided with an alarm to indicate low credit.
i) As per the guiding principles and Section 47(5) of the Electricity Act, 2003, the Petitioner
shall not charge any security deposit as is required in post-paid connections but price
equivalent to the material cost, i.e. cost of meter and associated equipment’s shall be
charged as material security which shall be returned after adjusting for the depreciation
at the time of permanent disconnection. The approved material security deposit for FY
2018-19 is Rs. 5000/- for single phase connection and Rs 10,000/- for three phase
connection.
j) The consumer shall be allowed only one transfer from postpaid to prepaid or otherwise
in a financial year.
k) Voltage rebate/surcharge, low power factor surcharge and excess load penalty shall not
be applicable for prepaid connections.
l) A rebate of 4% of Energy Charges for Domestic Category and 3% of Energy Charges for
other categories shall be applicable as per tariff schedule for the consumers availing this
scheme and the rebate shall only be applicable after installation and operationalization of
Prepaid meters.
Provided that no rebate shall be applicable on (i) of Para 1 of RTS-8, i.e. Temporary
Supply for Illumination/Public Address/ceremonies and festivities/functions/
temporary shops not exceeding 3 months.
Provided further that the fixed charge in respect of other domestic consumers [(1.2) of
para 2 of the RTS -1] shall be Rs. 55/kW/month.
m) The solar water heater rebate shall be adjusted as follows:-
i. The rebate for first month of implementation of prepaid metering scheme shall be
credited immediately on the first recharge. Thereafter, rebate shall be credited on
monthly basis if recharge is done every month.
ii. In case recharge is not being done on monthly basis, then based on the capacity of
Solar Water Heater installed by the consumer, solar water heater rebate would be
credited for all the past months for which the rebate was due either at the time of
recharge or when the consumer approaches UPCL.

5.1.3.11 Accounting of Electricity Consumption for Departmental Employees
The Commission in its Tariff Orders had not been allowing the impact of concessional
supply to departmental employees including pensioners of UPCL, UJVN Ltd. and PTCUL and has
been considering revenue corresponding to the ABR of domestic consumers. However, UPCL is
booking the consumption of departmental employees and pensioners on unmetered basis, i.e. UPCL
is charging a fixed charge approved by it in the year 2009 based on designation. The Average CoS
which was about Rs. 3.18 per unit in FY 2009-10 has increased to Rs. 5.04 per unit in FY 2018-19.
Further, concerns have been raised by several stakeholders regarding unmetered billing to its
departmental employees that too at a rate which was approved way back in 2009. The Commission
is aware of the provisions of the UP Electricity Reforms Act, 1999, UP Reforms Transfer Scheme,
2000 & UP Reorganisation Act, 2000 regarding the employees of erstwhile UPSEB. However, it has
been the view of the Commission that if UPCL has to give any benefits to its employees it has to be
from its own resources and the same cannot be passed on to the consumers. Accordingly, the
Commission further to streamline the accounting of departmental employee consumers directs
the Petitioner to bill all departmental employees consumers including pensioners on the basis of
rates approved for RTS-1 Domestic Category from April 01, 2018. The Petitioner shall include the
consumption and revenue details of these consumers at the Tariff Rates applicable to domestic
consumers in the monthly CS-3 and CS-4 statements. As regards the concession provided to these
consumers, the Petitioner is directed to show the same separately as expenses in its accounts.
5.1.4 Treatment of Revenue Gap
As concluded in Chapter 4 of the Order, the revenue at existing tariffs leaves a revenue gap
of Rs. 137.55 Crore to meet the Net Revenue Requirement for FY 2018-19, post adjustment of the
revenue surplus and gap determined after truing up of expenses and revenue based on the audited
accounts for FY 2016-17.
The Commission had approved the tariffs applicable for various categories with effect from
April 01, 2017 vide its Order dated March 29, 2017. The Petitioner further submitted that the
Additional Energy Charge (AEC) as approved by the Commission vide its Review Order dated
August 03, 2017 on True-up for FY 2015-16, Annual Performance Review for FY 2016-17 and Annual
Revenue Requirement for FY 2017-18 has been considered to be subsumed in the proposed increase
in fixed and energy charges and, therefore, has not been proposed separately.

The Commission vide its Order dated August 3, 2017 on the Review Petition filed by UPCL
for review of Commission’s Tariff Order for FY 2017-18 dated March 29, 2017 approved the
recovery of Additional Energy Charge (AEC) for the last three quarters of FY 2017-18. The relevant
extract of the Commission’s Review Order is reproduced below:
“…the Petitioner is hereby authorized to recover the AEC amount by levying AEC on various
consumer categories at the rates indicated in Annexure-I during the last three quarter of FY 2017-
18.”
Thus, the AEC approved by the Commission vide its Order dated August 3, 2017 is
applicable till March 31, 2018 only. Accordingly, the Commission while computing the tariffs at
existing revenue for FY 2018-19 has not considered the AEC component and has calculated revenue
at approved tariffs as per Tariff Order dated 29.03.2017.
The Commission in order to recover the gap has revised the tariffs for FY 2018-19. The
approved tariff will be applicable from April 1, 2018 and will be effective till revised by the
Commission.
5.1.5 Cross Subsidy
As per the provisions of Tariff Policy, the Regulatory Commission has to reduce the cross
subsidies with respect to the cost of supply in a gradual manner. The Commission in its Tariff Order
for FY 2017-18 had computed the cross subsidies for different category of subsidising consumers
which were in accordance with the Tariff Policy.
The Commission has now revised the tariffs and has ensured that the cross subsidies have
broadly reduced with respect to previous levels with few exceptions as discussed while discussing
the cross subsidy levels at approved tariffs.
5.1.6 Category-wise Tariff Design
The Commission has designed the category-wise tariffs for full recovery of approved Net
Revenue Requirement for FY 2018-19. The category-wise tariffs approved by the Commission are
discussed below and are also shown in the Approved Rate Schedule placed at Annexure-1. These
rates shall be effective from April 1, 2018 and shall continue to be applicable till further revised by
the Commission.

5.1.6.1 RTS-1: Domestic Tariff
The Commission, while recognising the fact that BPL/lifeline consumers were one of the
most economically weaker sections of the consumers, in its Tariff Order for FY 2003-04 had
approved a tariff of Rs. 1.50/kWh for such consumers when the average cost of supply was Rs.
2.28/kWh. Considering the fact that the Tariff Policy permits that the tariffs for such BPL/lifeline
consumers can be determined at 50% of the average cost of supply, the Commission in order to
gradually reduce the cross subsidy and also to enable the licensee to recover some of its Fixed Cost,
in its Tariff Order for FY 2011-12 dated May 24, 2011 had introduced a Fixed Charges of Rs.
5/connection/month which was further nominally increased every year.
Since the average cost of supply has increased further, therefore, with a view to reduce the
cross-subsidy, the fixed charges of BPL/lifeline consumer have been retained at existing level of Rs.
18/connection /month and energy charges have been revised to Rs. 1.61/kWh. In this regard, it is
important to note that currently, the BPL consumers are paying fixed charges of Rs
18/connection/month and Energy Charges of Rs 1.61/kWh including AEC. Thus, there is
practically no change in tariff for BPL consumers.
For other domestic consumers, the fixed charges have been marginally increased to enhance
the recovery from fixed charges. The energy charges for lowest slab, i.e. consumption upto 100
units/month have been nominally increased from the existing level of Rs. 2.55/kWh to Rs.
2.65/kWh. The energy charges for the second slab, i.e. for consumption between 101-200
units/month have been fixed as Rs. 3.45/kWh. The energy charges for the third slab, i.e. for
consumption between 201-400 units/month have been fixed as Rs. 4.70/kWh and for consumers
having consumption above 400 units/month, the energy charges have been fixed at Rs. 5.40/kWh.
For single point bulk supply connections, the energy charges have been increased to Rs.
4.25/kWh from Rs. 4.05/kWh and fixed charges have been increased to Rs. 70/kW/month from Rs.
60/kW/month.
Currently, in addition to existing tariff, the Domestic Consumers are also paying AEC of Rs
0.20/kWh. Hence, there will be no effective tariff increase for most of the domestic consumers.
A comparison of the tariff, i.e. existing, proposed by the Petitioner and that approved by the
Commission, is given in the Table below:

Table 5.2: Tariff for Domestic Consumers

Existing Tariff UPCL Proposed Tariff Approved
S. Fixed
Description Fixed Charge Energy Fixed Charge Energy Energy
No Charge (Per
(Per Month) Charges (Per Month) Charges Charges
Month)
RTS-1: Domestic
Rs. 18/ Rs. Rs. 20/ Rs. Rs. 18/ Rs.
1.1 Life Line Consumers
Connection 1.50/kWh Connection 1.65/kWh Connection 1.61/kWh
1.2 Other Domestic Consumers
Rs. 45/ Rs. Rs. 55/ Rs. Rs. 55/ Rs.
(i) 0-100 Units/Month
Rs. 70/ Rs. Rs. 85/ Rs. Rs. 80/ Rs.
(ii) 101-200 Units/Month
Rs. 110/ Rs. Rs. 135/ Rs. Rs. 135/ Rs.
(iii) 201-300 Units/Month
Rs. 135/ Rs. Rs. 165/ Rs. Rs. 135/ Rs.
(iv) 301-400 Units/Month
Rs. 180/ Rs. Rs. 220/ Rs. Rs. 220/ Rs.
(v) 401-500 Units/Month
Rs. 210/ Rs. Rs. 255/ Rs. Rs. 220/ Rs.
(vi) Above 500 Units/Month
Rs. Rs. Rs.
2 Single point bulk supply Rs. 60/kW Rs. 75/kW Rs. 70/kW
4.05/kWh 4.95/kWh 4.25/kWh
5.1.6.2 RTS 1-A: Concessional Snowbound Area Tariff
A comparison of the tariff, i.e. existing, proposed by the Petitioner and that approved by the
Commission, is given in the Table below:
Table 5.3: Concessional Tariff for Snowbound Areas

S.
Description Fixed Charge Fixed Charge Energy Fixed Charge
No Energy Charges Energy Charges
(Per Month) (Per Month) Charges (Per Month)
RTS-1A: Snowbound
Rs. 18/ Rs. 20/ Rs. Rs. 18/
1 Domestic Rs. 1.50/kWh Rs. 1.61/kWh
Connection Connection 1.65/kWh Connection
Non-Domestic Rs. 18/ Rs. 20/ Rs. Rs. 18/
2 Rs. 1.50/kWh Rs. 1.61/kWh
upto 1 kW Connection Connection 1.65/kWh Connection
Non-Domestic
Rs. 18/ Rs. 20/ Rs. Rs. 18/
3 above 1 kW Rs. 2.25/kWh Rs. 2.36/kWh
Connection Connection 2.50/kWh Connection
&upto 4 kW
Non-Domestic Rs. 30/ Rs. 35/ Rs. Rs. 30/
4 Rs. 3.40/kWh Rs. 3.51/kWh
above 4 kW Connection Connection 3.75/kWh Connection
5.1.7 RTS-2: Non-Domestic Tariff
For Non-domestic consumers, the Commission has marginally increased the energy charges
and fixed charges to enable the licenses to recover its fixed cost and revenue gap. Further, as

discussed earlier the MCG for this category has been abolished. The Commission has separately
specified the tariff for concessional sub-category of educational institutions, hospitals and charitable
institutions, which shall include:
 Government/Municipal Hospitals;
 Government/Government Aided Educational Institutions; and
 Charitable Institutions registered under the provisions of Income Tax Act, 1961 and
whose income is exempted from tax under this Act.
The existing tariff, tariff proposed by the licensee and that approved by the Commission is
given in Table below:
Table 5.4: Tariff for Non-domestic consumers

Fixed / Fixed /
Fixed /
Sl. Demand Demand
Description Charges Energy Energy Energy
No. MCG Charges MCG Charges MCG
(Per Charges Charges Charges
(Per (Per
Month)
Month) Month)
1 Government, Educational Institutions and Hospitals etc.
Rs. 55/ Rs. 4.30/ Rs. 65/ Rs 5.10/ Rs. 60/ Rs. 4.35/
1.1 Upto 25 kW
kW kWh kW kWh kW kWh
50 kVAh 50 kVAh
/kVA /kVA
Rs. 65/ Rs. 4.00/ Rs. 75/ Rs. 4.75/ Rs. 70/ Rs. 4.05/
1.2 Above 25 kW /month & /month & Nil
kVA kVAh kVA kVAh kVA kVAh
600 kVAh/ 600 kVAh/
kVA/annum kVA/annum
2 Other Non-Domestic Users
Upto 4 kW and
consumption Rs. 60 / Rs. 4.45/ Rs. 70 / Rs. 5.30/ Rs. 65 / Rs. 4.55/
2.1
upto 50 units kW kWh kW kWh kW kWh
per month
Others upto 25
Rs. 65 / Rs. 5.25/ Rs. 75 / Rs. 6.25/ Rs. 70 / Rs. 5.35/
2.2 kW not covered
kW kWh kW kWh kW kWh
in 2.1 above
50 kVAh 50 kVAh
/kVA /kVA
Rs. 65 / Rs. 5.15/ Rs. 75 / Rs. 6.15/ Rs. 70 / Rs. 5.25/
2.3 Above 25 kW /month & /month & --
600 kVAh/ 600 kVAh/
kVA/ annum kVA/ annum
50 kVAh 50 kVAh
Single Point /kVA /kVA
Rs. 65 / Rs. 5.05/ Rs. 75 / Rs. 6.00/ Rs. 70 / Rs. 5.15/
3 Bulk Supply /month & /month & --
above 75 kW 600 kVAh/ 600 kVAh/
kVA/ annum kVA/ annum
Independent
Rs. 80/ Rs. Rs. 95/ Rs. Rs. 85/ Rs.
4 Advertisement
kW 5.50/kWh kW 6.55/kWh kW 5.80/kWh
Hoardings

5.1.8 RTS-3: Government Public Utilities
As discussed earlier, the Commission has decided to merge the existing three categories
RTS-3: Public Lamp, RTS-5: Government Irrigation System and RTS-6 : Public Water Works into a
single category “Government Public Utilities” Category. The tariff for this category has been
approved in such a manner so that the average billing rate for this category is close to average cost
of supply. The existing tariff, tariff proposed by the licensee and that approved by the Commission
is given in the Table below:
Table 5.5: Tariff for Public Lamps

Fixed / Demand
Description Fixed / Demand Energy Fixed / Demand Energy
Charges (Per Energy Charges
Charges (Per Month) Charges Charges (Per Month) Charges
Month)
Public Lamps
Rs. 4.75/ Rs. 5.80/
Urban (Metered) Rs. 55/kVA Rs. 65/kVA Rs. 60/kVA Rs. 4.85/ kVAh
kVAh kVAh
Rural Rs. 4.75/ Rs. 5.80/
Rs. 45/kVA Rs. 55/kVA Rs. 50/kVA Rs. 4.85/ kVAh
(Metered ) kVAh kVAh
Table 5.6: Tariff for Government Irrigation System

Fixed /
Fixed / Demand Fixed / Demand
Description Energy Demand Energy Energy
Charges (Per Charges (Per
Charges Charges (Per Charges Charges
Month) Month)
Month)
Government
Rs. 4.60/ Rs. 5.65/ Rs. 4.85/
Irrigation Rs. 55/kVA Rs. 65/kVA Rs. 60/kVA
kVAh kVAh kVAh
System
Table 5.7: Tariff for Public Water Works

Fixed / Demand Fixed / Demand
Description Energy Fixed / Demand Energy Energy
Charges (Per Charges (Per
Charges Charges (Per Month) Charges Charges
Month) Month)
Rs. 4.70/ Rs. 5.75/ Rs. 4.85/
Urban Rs. 55/kVA Rs. 65/kVA Rs. 60/kVA
kVAh kVAh kVAh
Rural Rs. 4.70/ Rs. 5.75/ Rs. 4.85/
Rs. 45/kVA Rs. 55/kVA Rs. 50/kVA
kVAh kVAh kVAh

5.1.9 RTS-4: Private Tube Wells/Pump Setsand Agriculture Allied Activities
The Commission in order to gradually reduce the cross subsidy in this category has
increased the energy charge from Rs 1.75/kWh to Rs 1.84/kWh for this category of consumers.
Currently, the consumers of this category are paying Energy Charges of Rs 1.84/kWh including
AEC. Thus, there is practically no change in tariff for this category.
The existing tariff, tariff proposed by the licensee and that approved by the Commission are
given in the Table below:
Table 5.8: Tariff for Private tube Wells/ Pump Sets
Fixed / Fixed / Fixed /
Category Demand Energy Minimum Demand Energy Minimum Demand Energy Minimum
Charges Charges Charges Charges Charges Charges Charges (Per Charges Charges
(Per Month) (Per Month) Month)
RTS-4: Private Tube-wells / Pumping sets
Rs. 1.75/ Rs. 2.15/ Rs. 1.84/
Metered Nil - Nil - Nil -
kWh kWh kWh
RTS-4A: Agriculture Allied Activities
Rs. 1.75/ Rs. 2.15/ Rs. 1.84/
Metered Nil - Nil - Nil -
kWh kWh kWh
5.1.10 RTS-5: Industry
The Commission while determining the tariff of HT and LT Industries has taken into
consideration the average cost of supply and cross subsidy.
Further, as discussed above, the Commission has decided to retain the peak hour rate as 50%
higher than the normal hour rate applicable for highest slab, i.e. with load factor above 40% for all
the HT industrial consumers and increase the off peak hour rebate from 10% to 15%. Further,
consumers opting for continuous supply as per eligibility given in this Order shall have to pay 10%
additional energy charges as continuous supply surcharge only on energy supply made by UPCL,
i.e. the surcharge will not be applicable if power is sourced through open access. Further, as
discussed earlier the MCG for this category has been abolished.
The existing tariff, tariff proposed by the licensee and that approved by the Commission for
LT Industry is given in the Table below:

Table 5.9: Tariff for LT Industries

Fixed Fixed Fixed
Category Charges Energy Charges Energy Charges Energy
MCG MCG MCG
(Per Charges (Per Charges (Per Charges
Month) Month) Month)
RTS-5: Industry
LT Industry
*50 kWh/ *50 kWh/
1. LT
Rs. 140/ Rs. 4.20/ kW/month & Rs. 180/ Rs. 5.15/ kW/month & Rs. 145/ Rs. 4.25/
Industries --
kW kWh 600 kWh kW kWh 600 kWh kW kWh
(upto 25 kW)
/kW/annum /kW/annum
2. LT
50 kVAh/ 50 kVAh/
Industries
Rs. 140/ Rs. 3.85/ kVA/month & Rs. 180/ Rs. 4.70/ kVA/month & Rs. 145/ Rs. 3.90/
(above 25kW ---
kVA kVAh 600 kVAh /kVA/ kVA kVAh 600 kVAh /kVA/ kVA kVAh
& upto 75
annum annum
kW)
* 30 kWh/kW/month and 360 kWh/kW/annum for Atta Chakkis
The existing tariff and tariff proposed by the licensee for HT Industry is given in the Table
below:
Table 5.10: Existing and Proposed Tariff for HT Industries

Existing Tariff UPCL Proposed Tariff
Sl. Fixed
Category Load Factor Energy Fixed /Demand Energy
No. /Demand MCG
Charges Charges MCG Charges Charges
Charges Charges
(Rs./kVAh) (Rs./kVA) (Rs./kVAh)
(Rs./kVA)
1 HT Industry having contracted load above 88kVA/75 kW (100 BHP)
Contracted Upto 40% 3.65 Rs. 285/kVA of 4.32 Rs. 335/kVA

100
1.1 Load up to the billable 100 of the billable
kVAh/kVA
1000 kVA Above 40% 4.00 demand kVAh/kVA/ 4.72 demand
/month
month & 1200
Contracted &1200 kVAh
Upto 40% 3.65 Rs. 345/kVA of kVAh 4.32 Rs. 390/kVA
Load More /kVA/
1.2 the billable /kVA/annum of the billable
than 1000 annum
Above 40% 4.00 demand 4.72 demand
kVA

The approved tariff for HT Industry is given in Table below:
Table 5.11: Approved Tariff for HT Industry

Energy Fixed
MCG
S. Charges Charges
Category Load Factor
No Rs./kVA/ kVAh/kVA of
Rs./kVAh
month contracted load
1 HT Industry having contracted load above 88kVA/75 kW (100 BHP)
Contracted Upto 40% 3.85 Rs. 295/kVA
1.1 Load up to of the billable
Above 40% 4.20
1000 kVA demand
Contracted Upto 40% 3.85 ----
Rs. 355/kVA
Load More
1.2 of the billable
than 1000 Above 40% 4.20
demand
kVA
5.1.11 RTS-6: Mixed Load
The Commission has increased the tariff for this category to reduce the level of cross
subsidy. The existing tariff, tariff proposed by the licensee and that approved by the Commission is
given in the Table below:
Table 5.12: Tariff for Mixed Load

Existing Tariff UPCL Proposed Tariff Approved Tariff
Fixed / Fixed / Fixed /
Description Demand Energy Demand Energy Demand Energy
Charges Charges Charges Charges Charges Charges
Per Month) Per Month) (Per Month)
RTS-6: Mixed Load
Mixed Load Single Point
Bulk Supply above 75 kW
Rs. 70/kW Rs. 4.75/kWh Rs. 85/kW Rs. 5.80/kWh Rs. 75/kW Rs. 4.80/kWh
including MES as deemed
licensee
5.1.12 RTS-7: Railway Traction
The existing tariff, tariff proposed by the licensee and that approved by the Commission is
given in Table below:
Table 5.13: Tariff for Railway Traction

Existing Tariff UPCL Proposed Tariff Tariff Design
Fixed / Demand Fixed / Demand Fixed / Demand
Description Energy Energy Energy
Charges (Per Charges (Per Charges (Per
Charges Charges Charges
Month) Month) Month)
RTS-7: Railway Rs. 4.25/ Rs. 5.20/ Rs. 4.35/
Rs. 240/kVA Rs. 295/kVA Rs. 245/kVA
Traction kVAh kVAh kVAh

5.2 Revenue for FY 2018-19
Considering the revised tariffs, the Commission has computed the projected revenue at the
approved tariffs from each category for FY 2018-19. The summary of category-wise projected
revenue for FY 2018-19 is given in the following Table:
Table 5.14: Summary of Category Wise Projected Revenue

Average
S. Sales Revenue Billing Rate
Category
No. (ABR)
MU Rs. Crore Rs./Unit
1. RTS-1: Domestic 2950.13 1191.89 4.04
2. RTS-2: Non Domestic 1319.74 769.13 5.83
3. RTS-3: Govt. Public Utilities 612.27 322.83 5.27
4. RTS-4: Private Tube Wells 368.60 67.71 1.84
5. RTS-5: Industry
LT Industry 329.92 181.52 5.50
HT Industry 6062.82 3354.42 5.53
6. RTS-6: Mixed Load 186.78 95.47 5.11
7 RTS-7: Railway Traction 23.45 12.65 5.39
8. Additional Sales (Efficiency improvement) 34.76 17.58 5.06
9. Total 11888.48 6013.19 5.06
The estimated revenue for FY 2018-19 at approved tariffs works out to Rs. 6013.19 Crore, as
against the net ARR of Rs. 5997.50 Crore worked out after adjusting trued-up surplus/gaps of
previous years leaving a surplus of Rs. 15.69 Crore with UPCL. The Commission has left some
surplus while designing the tariffs as the exact impact of all the tariff rationalisation measures
approved by the Commission cannot be estimated at this stage. The Commission will consider the
actual sales and revenue while carrying out the truing up for FY 2018-19.
5.3 Cross Subsidy
As discussed above, the Commission has designed the tariffs for various categories with an
objective of gradually reducing the cross subsidy with respect to average cost of supply. The extent
of category-wise cross-subsidy at approved tariffs computed at average cost of supply is given in
the Table below:

Table 5.15: Cross Subsidy at Average Cost of Supply

Category Approved Average Average Cost of ABR / ACoS Cross
Billing Rate (ABR) Supply (ACoS) Subsidy
Rs./kWh Rs./kWh % %
RTS-1: Domestic 4.04 5.04 80.16% -19.84%
RTS-2: Non Domestic 5.83 5.04 115.63% 15.63%
RTS-3: Govt. Public Utilities 5.27 5.04 104.61% 4.61%
RTS-4: Private Tube Wells 1.84 5.04 36.45% -63.55%
RTS-5: Industry
LT Industry 5.50 5.04 109.17% 9.17%
HT Industry 5.53 5.04 109.78% 9.78%
RTS-6: Mixed Load 5.11 5.04 101.42% 1.42%
RTS-7: Railway Traction 5.39 5.04 107.02% 7.02%
The comparison of Cross Subsidy at approved tariffs with respect to the average cost of
supply in Tariff Order for FY 2017-18 and as approved in this Tariff Order for FY 2018-19 is given
below:
Table 5.16: Cross Subsidy at Approved Tariffs in FY 2017-18 and FY 2018-19

Cross Subsidy at Approved Cross Subsidy at Approved
Category
Tariff for FY 2017-18 Tariff for FY 2018-19
RTS-1: Domestic -21.03% -19.84%
RTS-2: Non Domestic 15.75% 15.63%
RTS-3: Govt. Public Utilities 2.76% 4.61%
RTS-4: Private Tube Wells -64.49% -63.55%
RTS-5: Industry
LT Industry 9.28% 9.17%
HT Industry 9.95% 9.78%
RTS-6: Mixed Load 1.52% 1.42%
RTS-7: Railway Traction 7.15% 7.02%
The Commission while designing the tariffs for FY 2018-19 has reduced the cross subsidies
for most of the categories with respect to approved tariffs for FY 2017-18 and has ensured to bring
the cross-subsidy levels within the range specified in the National Tariff Policy.
Further, it can be seen from the Table above, cross-subsidies of all the subsidising consumers
is within the range of 120% as required in the Tariff Policy.
Further, once the cross-subsidy level has been reduced to be within +20%, there is no
mandate under the Act or Tariff Policy to reduce it further. The criteria of ± 20 % of the average cost
of supply for all the categories including subsidised categories depends upon the consumption mix
of the Licensee. However, in case of the Petitioner, the consumption mix is skewed towards
subsidising categories having almost two third of total sales, while the consumption by subsidised
categories is around one third of the total consumption. Therefore, in case of Petitioner, though the
tariff for all the subsidising categories have been within 120% of the overall average cost of supply
of the Petitioner, the average tariff for some of the subsidised categories is less than 80% of the
overall average cost of supply of the Petitioner.
Hon’ble Appellate Tribunal of Electricity, in its Judgment dated February 28, 2012, in
Appeal No. 159 of 2011 has expressed similar views. The relevant extract given in Para 16 of the
Judgment is reproduced as under:
“... Provision of restricting cross subsidy to +/- 20% in Tariff Policy is applicable to areas where
proportion of both the categories, subsidizing and subsidized, are comparable. The same yard stick
cannot be applied in areas where consumer mix is highly biased in favour on one category.”
5.4 Open Access Charges
Uttarakhand Electricity Regulatory Commission (Terms and Conditions of Intra State Open
Access) Regulations, 2015 inter-alia specify wheeling charges applicable on the customers seeking
open access through distribution system, based on the category/nature of open access these
customers come under in accordance with the Regulations.
In this regard, Regulation 20(2) specifies as under:
“Wheeling charges payable to distribution licensee, by an open access customer for usage of its system
shall be as determined as under:
Wheeling Charges = (ARR–PPC–TC) /(PLSD X365) ( Rs./MW/Day)
Where,
ARR=Annual Revenue Requirement of the distribution licensee for the relevant year
PPC= Total Power Purchase Cost of distribution licensee for the relevant year
TC = Total transmission charges paid by distribution licensee for State and Inter-State
transmission system for the relevant year
PLSD= Total Peak load served by the concerned distribution system for the previous year

Provided where Open Access is allowed up to contracted load, embedded open access
consumer shall pay wheeling charges as determined by the Commission in the following
manner:
WC Embedded consumer = WC – [FC*0.85*12*1000/365] (in Rs./MW/day)
Where,
WC Embedded consumer = Net wheeling charges for embedded consumers
WC= Wheeling charges as determined by the Commission in accordance with the

methodology specified in Regulation 20(2) contained in Chapter 5 of these regulations.
FC= Fixed/demand charges in Rs/kVA/month as per rate schedule approved in the Tariff
Order for the relevant year. For the purpose of conversion of kVA into kW power factor
of 0.85 has been taken.
Note: In case Wheeling Charges for Embedded consumer worked out as above becomes
negative, such charge shall be zero.
Provided that wheeling charges shall be payable on the basis of Approved Capacity.
Provided where open access is allowed beyond the contracted load, embedded open access
consumer shall pay wheeling charges for the excess load as determined by the Commission in
the following manner:
WC For excess load allowed= (ARR–PPC–TC) /(PLSD X365) ( Rs./MW/Day)
The PLSD during FY 2017-18 is 2149 MW. Hence, in accordance with the methodology
provided in the aforesaid Regulations, the wheeling charges payable by customers seeking open
access for FY 2018-19 (applicable upto 31st March, 2019) shall be:
Table 5.17: Wheeling Charges approved for FY 2018-19

Description Rs./MW/day
Wheeling Charges 9284
“Embedded open access consumers” who have been allowed open access up to the
contracted load shall not pay the wheeling charge as above who shall otherwise pay net wheeling
charges calculated in accordance with the methodology specified in the regulations and the same
works out to Rs. 0/MW/day for HT industry consumers having contracted load above 1000 kVA
and Rs. 1040/MW/day for HT industry consumers having contracted load upto 1000 kVA. Non-

Domestic consumers shall pay wheeling charges of Rs. 7328/MW/day. Moreover, “embedded open
access consumers” who have been allowed open access beyond the contracted load shall pay
wheeling charges for the excess load equal to Rs. 9284/MW/day. However, where a dedicated
distribution system for open access has been constructed for exclusive use of an open access
customer, the wheeling charges for such dedicated system shall be worked out by the distribution
licensee for its respective system and shall get it approved by the Commission and will be borne
entirely by such open access customer till such time the surplus capacity is allotted and used by
other open access customers, where after, the cost of the above system will be shared on pro-rata
basis depending upon open access capacity allotted to them. Provided that wheeling charges shall
not be levied on the open access customers connected to the transmission system at 132 kV and
above voltage levels. The distribution losses applicable to open access customers for FY 2018-19
shall be the pooled average system distribution losses, i.e. 14.50% considered in this Order. Cross
subsidy surcharge applicable, in accordance with the Regulations, to open access customers for FY
2018-19 have been determined as Rs. 0.49/kWh for HT industrial consumers and Rs. 0.79/kWh for
non-domestic consumers.
The Petitioner is hereby directed that the wheeling charges and cross subsidy surcharge
recovered from open access customers shall be shown separately under the separate head of
income in its ARR/Tariff filings.
The Petitioner in its Petition had submitted that the open access consumers with UPCL are
of embedded nature, who buys power from UPCL as well as through open access as per their
financial suitability. However, in case these open access consumers choose to buy power from
UPCL in place of open access, then the Petitioner is required to supply power to them as per their
contracted capacity with it. Accordingly, the Petitioner is required to have an arrangement of power
sufficient to meet the requirement of these open access Consumers including the quantum which
they were buying earlier through open access. In case any Consumer goes for open access, then the
Power Purchase commitments of the Petitioner becomes stranded and, therefore, the open access
consumers are required to bear fixed component of power purchase cost of the Petitioner. The
Petitioner further submitted that absence of suitable additional surcharge levied to the open access
consumer would result in undue burdening on the other consumers of the licensee. Accordingly, it
had proposed levying additional surcharge on the open access consumers.

The Commision, had pointed out deficiencies in the submissions made by UPCL with
reference to calculation of additional surcharge. During the Meeting of Advisory Committee,
submitted that they have proposed an additional surcharge of Rs. 1.42 per kWh based on the
average fixed cost of the total power purchase and the issue of levying additional surcharge would
be examined in accordance with the provisions of the Regulations and also the practices being
followed in other States and modify its proposal accordingly. However, no revised proposal has
been submitted till date.
The Commission accordingly, advises the Petitioner to submit a fresh Petition, if required, in
accordance with the Regulations clearly demonstrating that some power remained stranded due to
open access consumers.

6. Review of Commercial Performance of UPCL
6.1 General
Uttarakhand, the 27th State of India was created on 09.11.2000 as the 10th Himalayan State of
the country blessed with abundant natural resources with an approx. 53,483 sq. km area and
presently having a population of approximately 103.56 Lakh. The Electricity Distribution Network
is managed by Uttarakhand Power Corporation Limited (UPCL) the sole distribution licensee in the
State. UPCL had been entrusted to cater to the Transmission & Distribution Sector inherited after
the de-merger from UPPCL (erstwhile UPSEB) since 01.04.2001. The Electricity Act, 2003 mandated
the separation of Transmission functions under Power Sector Reforms. Consequently, on 01.06.2004,
the Power Transmission Corporation Limited (PTCUL) was formed to maintain & operate EHV
Transmission lines & substations in the State.
Today UPCL, the sole power distribution utility in the State caters to the sub–transmission &
distribution network which includes substations & distribution lines in 13 districts of Uttarakhand
namely Dehradun, Pauri, Tehri, Uttarkashi, Rudraprayag, Chamoli, Haridwar, Pithoragarh,
Bageshwar, Almora, Nainital, Champawat, & Udhamsingh Nagar, details of which are given below
in Table 6.1 & 6.2.
Table 6.1: Detail of Substations (S/s) maintained by UPCL as on 31.12.2017
66/11 KV S/s 33/11 KV S/s 11/0.415 KV S/s
S.
Name of District No. of Total MVA No. of Total MVA Total MVA
No. Nos. Nos. Nos.
Transformers capacity Transformers capacity capacity
Garhwal Zone
1. Dehradun 59 115 866 6773 772.81
2. Uttarkhashi 11 21 81 1608 72.86
3. Pauri 31 50 215 5620 255.05
4. Tehri 14 26 109 3811 149.65
5. Chamoli 3 5 38 16 21 93 2064 77.23
6. Rudraprayag 7 8 36 1754 56.04
Total Garhwal Zone 3 5 38 138 241 1400.45 21630 1383.64
Haridwar Zone
7. Haridwar 57 120 1039 16414 1043.78
Total Haridwar Zone 0 0 0 57 120 1039 16414 1043.78
Kumaon Zone
8. Nainital 28 49 333 5074 453.37
U.S.Nagar (Kashipur,
9. 23 49 354 6060 360.65
Bazpur Jaspur)
10. Almora 25 42 138 4134 152.01
11. Bageshwar 9 13 40.5 1725 64.31
Total Kumaon Zone 0 0 0 85 153 865.5 16993 1030.34
Rudrapur Zone
U.S.Nagar
12. 32 67 592.5 7486 464.97
(Rudrapur, Sitarganj)
13. Pithoragarh 17 27 106 3407 113.03
14. Champawat 7 11 45 1313 45.26
Total Rudrapur Zone 0 0 0 56 105 743.5 12206 623.26
Total UPCL 3 5 38 336 619 4048.45 67243 4081.02

Table 6.2: Detail of Lines maintained by UPCL as on 31.12.2017

66 KV Line 33 KV Line 11 KV Line LT Line
S.No. Name of District
(In Km.) (In Km.) (In Km.) (In Km.)
Garhwal Zone
1. Dehradun 752.15 7095.63 10986.92
2. Uttarkhashi 285.30 2045.93 2251.36
3. Pauri 606.47 5212.79 8085.58
4. Tehri 364.38 4141.84 6452.74
5. Chamoli 121 185.34 2347.02 4045.37
6. Rudraprayag 136.19 1254.93 1759.69
Total Garhwal Zone 121 2329.83 22098.14 33581.66
Haridwar Zone
7. Haridwar 563.22 4135.32 6080.41
Total Haridwar Zone 0 563.22 4135.32 6080.41
Kumaon Zone
8. Nainital 378.01 2819.63 4470.99
U.S.Nagar
9. 265.37 1614.53 1810.69
(Kashipur, Bazpur Jaspur)
10. Almora 492.65 3865.86 6785.80
11. Bageshwar 185.78 1635.14 2205.27
Total Kumaon Zone 0 1321.81 9935.16 15272.75
Rudrapur Zone
U.S.Nagar
12. 340.13 2260.82 2692.12
(Rudrapur, Sitarganj)
13. Pithoragarh 68.5* 280.52 2890.88 3473.27
14. Champawat 165.87 1663.19 2153.73
Total Rudrapur Zone 68.5 786.52 6814.89 8319.12
Total UPCL 189.5 5001.38 42983.51 63253.94
On examination of the details of sub-stations and lines maintained by UPCL as on 31.12.2017

vis-a-vis as on 31.12.2016, it has been observed that UPCL was able to increase its total
transformation/sub-station capacity and total line length by 476 MVA and 10,865 Kms. respectively
in last one year as detailed below:
Table 6.3: Increase in Assets of UPCL in last one year (31.12.16 to 31.12.2017)
Description 33 kV 11 kV LT Total
Substation Capacity as on
4048 4081 -- 8129
31.12.2017
Substation Capacity as on
3707 3946 -- 7653
31.12.2016
Net Increase in Substation
341 135 -- 476
Capacity (in MVA)
Line length as on 31.12.2017
5001 42984 63254 111239
(in Km)
Line length as on 31.12.2016
4663 39123 56588 100374
(in Km)
Net Increase in Line length
338 3861 6666 10865
(in Km)
The Distribution network of UPCL as on 31.12.2017 contains four Zones namely Garhwal,
Haridwar, Kumaon & Rudrapur having total eleven Circles containing 41 Divisions. The new
division which have been formed in FY 2017-18 upto 31.12.2017 are namely Bhikiyasain, Khatima,

Mohanpur, Jwalapur, Ramnagar (Roorkee) and Bhagwanpur (Roorkee). The State has a distinct
advantage over other comparable States as a small number of consumers consume major share of
power for which a Key Consumer Cell (KCC) has been constituted. Hence, a large portion of
revenue of the Petitioner comes from these KCC consumers. There were 19.89 Lakh consumers as
on 31.03.2016, and 20.94 Lakh consumers as on 31.03.2017. This increase of total 1,05,144 consumers
during the year was primarily in Domestic category (84%). The Consumer Mix, Consumption
pattern & Revenue pattern for FY 2015-16 & FY 2016-17 are elaborated below:
6.1.1 Consumer Mix during FY 2015-16 & FY 2016-17
In FY 2015-16, out of the total approximately 19.89 Lakh consumers in the State, there were
87.46%-Domestic consumers, 10.33%-Non-Domestic consumers and only 0.57% consumers of the
Industrial category. It is seen that these industrial (HT+LT Industries) consumers accounted for
around 55.54% of the total consumption of the State and contribute to about 60.67% of Petitioner’s
revenue. The following Chart depicts the consumers mix in the State during FY 2015-16.
CHART 1: Consumer Mix (FY 2015-16)
In FY 2016-17, out of the total approximately 20.94 Lakh consumers in the State, there were
87.29%-Domestic consumers, 10.46%-Non-Domestic consumers and only 0.58% consumers of the
Industrial category. It is seen that these industrial (HT+LT Industries) consumers accounted for
around 54.92% of the total consumption of the State and contribute to about 61.76% of Petitioner’s
revenue. The following Chart depicts the consumers mix in the State during FY 2016-17.

CHART 2: Consumer Mix (FY 2016-17)
Besides above, it has been observed that despite Commission’s specific directions not to
indicate un-metered category details in its Commercial Diary and also no energy should be booked
in this account. The Petitioner in its Commercial Diary for FY 2016-17, i.e. CS 3 and CS 4 is still
booking Energy/Revenue in the consumer categories, viz. RTS-3 (Unmetered) and RTS-4
(Unmetered). Such action of distribution licensee is a clear violation of the Commission’s directions.
Hence, the Commission again directs UPCL not to indicate any un-metered category in its
commercial diary and should ensure that no energy should be booked, in this account. In
absence of the corrective action at UPCL’s end, action under provisions of Act/Rules/Regulations
would be initiated.
6.1.2 Consumption Pattern during FY 2015-16 & FY 2016-17
In FY 2015-16, it was observed that with respect to total consumption of the State, the
consumption of Industrial consumers (HT+LT Industries) was 55.54% and for Domestic & Non-
Domestic consumers the consumption was 23.22% & 10.86% respectively. The following Chart
shows the consumption pattern in the State during FY 2015-16.

CHART 3: Consumption Pattern during FY 2015-16
In FY 2016-17, it was observed that with respect to total consumption of the State, the
consumption of Industrial consumers (HT+LT Industries) was 54.92% and for Domestic & Non-
Domestic consumers the consumption was 23.51% & 11.10% respectively. The following Chart
shows the consumption pattern in the State during FY 2016-17.
CHART 4: Consumption Pattern during FY 2016-17
Comparison of consumption pattern in FY 2015-16 & FY 2016-17 depicts that %age share of
Industrial consumption has slightly decreased by 0.62%, whereas, %age share of domestic
consumption has increased by 0.29% and the %age share of non-domestic consumption has
increased by 0.24%.
With regard to the decrease in energy consumption of Industrial consumers, the

Commission is of the view that the flexibility to the consumers to source its power requirements
from any of the generating sources within or outside the State under open access, installation of
solar rooftops under Net Metering Scheme and encouragement of energy efficient equipments are
the main reasons for the same. The Commission is of the opinion that the volume of power being
sold by the Petitioner to this category of consumers may get reduced progressively in case the
Petitioner does not improve its performance and ensure quality and reliable supply of power at
competitive rates for its consumers. Moreover, as Industries are subsidising consumers, therefore,
reduction in revenue from Industries would significantly affect the commercial viability of the
Distribution Business. The following Table gives the quantum of power traded through Exchanges
(Open Access) by the Embedded Open Access Consumers which are increasing year on year and
measures have to be taken by UPCL to ensure reliable and quality supply to the industries at
reasonable prices to the arrest increase in open access sales.
Table 6.4: Quantum of Power Traded through Open Access

Year Quantum (MU)
FY 2011-12 10.34
FY 2012-13 100.93
FY 2013-14 281.03
FY 2014-15 181.37
FY 2015-16 274.52
FY 2016-17 385.81
6.1.3 Revenue Pattern during FY 2015-16 & FY 2016-17
With regard to the revenue from sale of energy during FY 2015-16, the contribution of
Industrial consumers was 60.67% [HT Industrial consumers was 57.62%, LT industrial consumers
was 3.05%] whereas Domestic consumers were contributing around 16.42%. The following Chart
shows the Revenue Pattern of various consumer categories in the State.
CHART 5: Revenue Mix in FY 2015-16

With regard to the revenue from sale of energy during FY 2016-17, the contribution of
Industrial consumers was 61.76% [HT Industrial consumers was 58.55%, LT industrial consumers
was 3.21%] whereas Domestic consumers were contributing around 16.60%. The following Chart
shows the Revenue Pattern of various consumer categories in the State.
CHART 6: Revenue Mix in FY 2016-17
On comparing the revenue pattern of FY 2015-16 and FY 2016-17, it is noticed that the %age
revenue share of Industrial Consumers, non-domestic & domestic consumers with respect to the
total revenue had increased by 1.09%, 0.39% & 0.18% respectively. This is a welcoming signal that
%age revenue from the subsidising category of consumers, i.e. Industrial & Non-domestic
consumers have slightly increased in FY 2016-17.
6.2 Commission’s Analysis and Directions on Commercial Performance
The Commission has been monitoring & reviewing the performance of the Petitioner based
on the information/reports submitted by it. Infact, higher distribution losses in distribution system
are detrimental to financial and commercial viability of the Petitioner. Therefore, analysis of
Petitioner’s performance especially in respect of metering, billing and revenue collection is vital
with the focus on reducing the Aggregate Technical and Commercial (AT&C) losses of the
Petitioner. The Commission from its very first Tariff Order has been issuing various
directions/Orders in this regard from time to time. However, the Petitioner has always been non-
compliant. The Commission had, therefore, decided to monitor the commercial performance of the
Petitioner in a more structured manner on a monthly basis and, accordingly, various formats were
issued to the Petitioner vide Commission’s letter UERC/7/CL/152/2008-09/284 dated 17.05.2012

with the direction to submit the above information in these Formats regularly for each month by
15th day of the next month.
Despite, the specific directions issued by the Commission in its previous Tariff Orders, the
Petitioner had neither been submitting the periodical reports timely nor in accordance with the
prescribed formats.
Considering the fact that the Petitioner encompasses 35 number of Distribution Divisions in
the State, the Commission felt the need to monitor UPCL on Distribution Division basis. In order to
quantify the improvement on month on month basis of any of the performance indicators, it is
necessary that Division-wise targets on each parameter be provided by the licensee which would
make the whole monitoring process more meaningful. Hence, the Commission vide its letter no.
UERC/5/Tech/112/2014-15/1622 dated 27.11.2014 issued following revised Commercial
Performance Monitoring formats directing UPCL to submit information on these formats in hard as
well as in soft copy (MS-excel file in CD) on regular basis latest by 25th day of the next month from
January, 2015 onwards.
Table 6.5: Revised Formats prescribed by the Commission vide letter dated
27.11.2014
S. No. Description Format
1. No. of Consumers 1
2. Quarterly Targets of NA/NR/IDF/ADF/RDF 2
3. Status of Not Accessible (NA) Consumers (in Percentage) 2(A)
4. Status of Not Read (NR) Consumers (in Percentage) 2(B)
5. Status of Identified Defective Meters (IDF) (in Percentage) 2(C)
6. Status of Appeared Defective Meters (ADF) (in Percentage) 2(D)
7. Status of Reading Defective Meters (RDF) (in Percentage) 2(E)
Quarterly Targets of IDF Meters/Mechanical Meters/Un-metered
8. 3
Consumers/Ghost Consumers
9. Status of Identified Defective Meters (IDF) 3(A)
10. Status of Un-metered Consumers 3(B)
11. Status of Mechanical Meters 3(C)
12. Status of Ghost Consumers 3(D)
13. Status of Not Billed (NB)/Stop Billed (SB) Cases 4
14. Status of Outstanding Arrears 5
15. MRI Status of KCC Consumers 6
16. Status of Revenue realisation per unit of Energy Sold 7
17. Status of AT&C Losses of UPCL 8
However, the Commission has observed that the Distribution Licensee has been inconsistent
in furnishing the Commercial Performance Monitoring reports on the aforesaid formats in hard as

well as in soft copy (MS-excel file in CD) on regular basis in accordance with the directions, i.e.
latest by 25th day of the next month.
The Commission has observed that the Petitioner has not only been inconsistent in
furnishing the Commercial Performance Monitoring reports within the stipulated time frame but
also has failed to submit Format - 2 & Format- 3 alongwith the report of the first month of the
Financial Year, i.e. alongwith the report of April, 2017. The Commission has observed that despite
categorically mentioning in the guidelines of the prescribed Formats regarding submission of
Quarterly Targets in the first month of the Financial Year i.e. April, 2017, the Petitioner submitted
the Quarterly Targets in Format-2 & Format-3 to the Commission as late as July, 2017 i.e. vide its
letter no. 2789 dt. 07.07.2017 for Garhwal, Haridwar & Rudrapur Zones and vide letter no. 2824 dt.
10.07.2017 for Kumaon Zone.
The Commission is of the view that the basic purpose of advance target setting for each
quarter is to enable analysis of actual performance vis-a-vis target performance of the licensee. In
the absence of advance target setting, comparative analysis is rendered impossible which clearly
shows a lackadaisical approach of the Petitioner towards compliance of the provisions of the
Act/Regulations and directions of the Commission.
Therefore, the Commission again directs Petitioner to submit monthly Commercial

Performance Monitoring reports strictly in the prescribed formats on regular basis, so as to reach
the Commission latest by 25th day of the following month and without fail furnish the Quarterly
Targets as per prescribed Format - 2 & 3 alongwith the Commercial Performance Monitoring
report for the month of April, 2018.
The Commission’s analysis on the information submitted by the Petitioner for the period
01.04.2017 to 31.12.2017 through its various submissions is being discussed in the following
paragraphs:
6.2.1 Metering
The Commission in its earlier Tariff Orders had been repeatedly giving directions to the
Petitioner to energise new connections (including metering of unmetered connections) with the
static/electronic meters and to replace all old mechanical meters with new electronic/static meters
in accordance with CEA Regulations.

However, the Commission has observed that the Petitioner has a lackadaisical approach in
furnishing correct report in this regard to the Commission in the prescribed formats. The reports
pertaining to various performance parameters on metering and other issues have been analysed and
findings thereof are being discussed below:
6.2.1.1 Status of NA/NR, IDF/ADF/RDF
The Commission vide its Tariff Order dated 29.03.2017, had issued directions to the
Petitioner to reduce the percentage NA/NR cases to below 2% in the entire State latest by
30.09.2017, failing which the concerned Chief Engineer (Distribution), Superintending Engineer
(Distribution), Executive Engineer (Distribution) & Executive Engineer (Test) shall be held
responsible for non-compliance of the Commission’s directions and appropriate action under the
Act/Rules/ Regulations may be initiated.
UPCL in its compliance of directives has submitted that UPCL vide its letter No. 1045 dated
19.04.2017 has directed all its field officers to reduce the %age NA/NR cases to below 2% latest by
30.09.2017 and subsequently in a review meeting dated 01.07.2017 the field officers were directed to
achieve the level of NA/NR cases to below 2%.
However, on examination of the Quarterly Targets submitted by UPCL in Format-2, it is

observed that the target set for NA/NR cases at the end of 3rd quarter of FY 2017-18 in 22 divisions
out of total 36 divisions were exceeding 2% which shows that the Petitioner is bound to fail in
complying with the directions of the Commission issued in the Tariff Order dated 29.03.2017.
Taking a strong exception, the Commission is of the view that the Petitioner indeed requires
improvement at division level in order to reduce provisional billing cases and aim for achievement
of overall target set for NA/NR cases in the State in accordance with the Orders of the Commission.
Hence, UPCL is required to diligently monitor & pursue each Distribution Division rigorously so as
to align its actual percentage of NA/NR billing with the targets in accordance with the
Commission’s Orders/directions.
The Commission has observed that the percentage of provisional billing cases namely
NA/NR, RDF/ADF/IDF, furnished in prescribed formats 2(A), 2(B), 2(C), 2(D) & 2(E) for FY 2017-
18 are still at alarmingly high levels vis-a-vis total number of billed consumers as shown in the
Table given below:

Table 6.6: Status of Provisional Billing viz. NA/NR/IDF/ADF/RDF

As on 31st As on 31st As on 31st As on 31st As on 31st As on 31st
Status
March 2013 March 2014 March 2015 March 2016 March 2017 Dec 2017
NA (%) 2.5 3.3 4.09 3.19 3.27 3.30
NR (%) 6.6 5.7 4.79 2.85 2.10 4.54
IDF (%) 11.9 8.6 7.59 6.22 4.94 4.00
ADF (%) 0.7 0.5 0.35 0.00 0.00 0.00
RDF (%) 0.8 1.0 1.62 1.34 1.02 0.99
Total (%) 22.5 19.2 18.44 13.6 11.33 12.83
Total Billed
16,47,224 16,64,159 17,42,507 18,15,454 19,15,855 19,94,335
Consumers (Nos.)
From the above Table, it is observed that there has been an increase in total percentage of
NA/NR, IDF/ADF/RDF cases in FY 2017-18 (upto 31.12.2017) which is not at all close to the
directions/provisions of the SOP Regulations issued by the Commission. Wherein, the total
provisional billing cases should be within 3% of the total number of consumers of the licensee,
whereas as per the Table above, the IDF cases itself are 4% which is one of the constituents of
provisional billing basis and constitute only a portion of such billing basis, therefore, it can be said
that the Petitioner has to put in concerted efforts to bring the overall provisional billing percentage
to within 3% of the total number of consumers in plain as well as hill areas of the State.
On further examination of Quarterly Targets furnished by UPCL vis-a-vis actual progress

made in the field as on 31.12.2017, it has been observed that UPCL was not able to comply with the
directions of the Commission to bring NA/NR cases below 2% in the entire State by 30.09.2017, but
has also failed to achieve its own Quarterly Targets by the end of 3rd Quarter of FY 2017-18. In only
1 division namely Haldwani (R), the Petitioner was able to comply with the directions of the
Commission for bringing NA/NR cases below 2% by 31.12.2017. Whereas, as on 31.12.2017 the
overall percentage of NA/NR cases remains grim as 28 divisions still have NA/NR cases more than
5% which shows that the Petitioner has shown lackadaisical approach in reducing NA/NR cases.
The Commission is of the view that despite numerous directions issued to the Petitioner for
reducing and bringing the provisional billing cases within 3%, the Provisional billing cases are still
12.83% as on 31.12.2017. Moreover, NA/NR cases alone are around 8% which reflects abysmal
performance of the Petitioner in bringing down the provisional billing percentage in the State.
Therefore, giving last opportunity to the licensee, the Commission again directs the Petitioner to
reduce the percentage NA/NR cases to below 2% in the entire State latest by 30.09.2018, failing
which the concerned Chief Engineer (Distribution), Superintending Engineer (Distribution),
Executive Engineer (Distribution) & Executive Engineer (Test) shall be held responsible for non-
compliance of the Commission’s directions and appropriate action under the Act/Rules/
Regulations would be initiated.
6.2.1.2 Replacement of Improper, Non-Functional, Stop/Stuck up defective meters (referred to as

Identified defective meters (IDF))
In this regard, the Commission vide its Tariff Order dated 29.03.2017 had directed the
Petitioner to restrict percentage defective meters (IDF) to 3% in plain as well as in hilly areas of the
State upto 30.09.2017, failing which the concerned Chief Engineer (Distribution), Superintending
Engineer (Distribution), Executive Engineer (Distribution) & Executive Engineer (Test) shall be held
Act/Rules/Regulations may be initiated.
UPCL in its compliance of directives has submitted that due to shortage of manpower the
desired results could not be achieved. Therefore, a tender for replacement of defective meters has
been floated in July, 2017 and the target to maintain the level of defective meters below 3% in all
areas (Urban and Rural) will be achieved by the end of September, 2018.
On examination of the Quarterly Targets submitted by UPCL in Format-2, it is observed that

the target set for IDF cases at the end of 3rd quarter of FY 2017-18 in 10 divisions out of total 36
divisions were exceeding 3% which shows that the Petitioner is expected to not only fail in
achieving its own targets but is also expected to fail in complying with the directions of the
Commission issued in the Tariff Order dated 29.03.2017. Taking a strong exception, the Commission
is of the view that the Petitioner indeed requires improvement at division level in order to reduce
provisional billing cases and aim for achievement of overall target set for IDF cases in the State in
accordance with the Orders of the Commission. Hence, UPCL is required to diligently monitor &
pursue each Distribution Division rigorously so as to align its actual percentage of IDF cases with
the targets in accordance with the Commission’s Orders/directions.
Circle-wise number of defective meters reported by the Petitioner in the prescribed format
3(A) is shown in the Table given below:

Table 6.7: Status of Defective Meters

No. of No. of No. of No. of No. of No. of % of
Defective Defective Defective Defective Defective Defective Defective
S.
Name of Circle Meters as Meters as Meters as Meters as Meters as Meters as Meters as
No.
on on on on on on on
31.03.2013 31.03.2014 31.03.2015 31.03.2016 31.03.2017 31.12.2017 31.12.2017
1. EDC Dehradun (R) 23166 19278 17263 5868 5094 4730 2.05
2. EDC Roorkee 12127 13182 11048 7366 6668 5765 3.27
3. EDC Haridwar 16715 9705 7217 4552 3480 2706 1.71
4. EDC Srinagar 36515 40586 43236 34056 27986 22541 7.75
5. EDC Dehradun 9162 4250 551 770 809 693 0.38
6. EDC Kashipur 9984 4017 1947 996 1064 1455 1.19
7. EDC Rudrapur 27221 16950 12293 7290 6320 8419 4.54
8. EDC Ranikhet 36056 24320 30095 12434 14059 12580 7.08
9. EDC Haldwani 25260 10430 8641 6246 4044 2944 1.44
10. EDC Tehri - - - 16366 12666 8952 7.03
11. EDC Pithoragarh - - - 16963 12494 9004 6.51
Total 196206 142718 132291 112907 94684 79789 4.00
From the above Table, it can be seen that the Petitioner had managed to reduce only 14,895
number of defective meters in FY 2017-18 (upto 31.12.2017) which shows that the activity of
replacement of defective meters was not taken seriously at the Petitioner’s end due to which as on
31.12.2017 the percentage defective meters in UPCL’s network were 4% of the total number of billed
consumers, i.e. 19,94,335 as on the aforesaid date.
It is observed that the Petitioner has blatantly failed to comply with the directions of the
Commission as the total percentage of defective meters as on 30.09.2017 was 4.27% which is more
than the targeted 3% IDF cases as directed by the Commission vide its Tariff Order dated
29.03.2017.
It is an admitted fact that by expeditious replacement of defective meters on the basis of well
laid down defective meter replacement programme, the Petitioner will not only be able to control
this menace but will also comply with the provisions of SOP Regulations.
Moreover, on examination of Quarterly Targets furnished by UPCL in Format-2 & Format-3

vis-a-vis actual progress made in the field as on 30.09.2017, it has been observed that in only 21 nos.
divisions out of 40 divisions in the State as on 30.09.2017, the Petitioner was able to achieve actual
IDF cases percentage below the target level of 3% IDF cases. However, instead of improving in
other remaining divisions the IDF cases exceeded 3% in 23 out of 41 divisions as on 31.12.2017. This
clearly shows arbitrariness in the meter replacement programme of the Petitioner.

The Commission is of the view that although there has been an improvement in IDF cases,
but still the overall progress made by the Petitioner does not comply with the directions of the
Commission. Therefore, the Petitioner is directed to restrict percentage defective meters (IDF) to
3% in plain as well as in hilly areas of the State by 30.09.2018, failing which the concerned Chief
Engineer (Distribution), Superintending Engineer (Distribution), Executive Engineer
(Distribution) & Executive Engineer (Test) shall be held responsible for non-compliance of the
Commission’s directions and appropriate action under the Act/Rules/Regulations would be
initiated.
6.2.1.3 Un-metered Consumers
The Commission in its previous Tariff Order dated 29.03.2017, had taken a view that since
the number of unmetered consumers has been reduced to Nil in the month of November 2016,
therefore, from December 2016 onwards any un-metered consumer, if found, in any of the
Petitioner’s record or billing ledger shall be treated as mis-declaration/wrong reporting by the
Petitioner in its monthly Commercial Performance Monitoring reports and appropriate action
under Act/Regulations may be initiated against the concerned officers of the Petitioner including
Executive Engineer (Distribution) of the concerned Division.
The status of Un-metered consumers as furnished by the Petitioner in the prescribed format
3(B) is given below:
Table 6.8: Status of Unmetered Consumers

As on As on As on As on As on As on As on As on As on As on As on As on As on
Status
3/14 3/15 3/16 3/17 4/17 5/17 6/17 7/17 8/17 9/17 10/17 11/17 12/17
Nos. of Un-
metered 6542 4691 45 0 0 0 0 0 0 0 0 0 0
Consumers
From the above Table, it is inferred that the Petitioner has been able to reduce the number of
the un-metered consumers to Nil in the month of December, 2017.
6.2.1.4 Replacement of Mechanical Meters
The Commission vide its Order dated 29.03.2017 had directed the Petitioner to consolidate
its complete database for Mechanical Meters including areas not covered under R-APDRP/IPDS
Schemes. Further, the Commission had also directed the Petitioner to prepare a division-wise firm
plan for replacement of all the existing Mechanical Meters by Electronic/Static Meters within next 2
years and submit the same along-with the prescribed Format-3 of Commercial Performance
Monitoring report for the month of April 2017 and ensure that 50% of the existing mechanical
meters are replaced by Electronic/Static meters latest by 31.03.2018.
The status of mechanical meters furnished by the Petitioner in the prescribed format 3(C) is
given below:-
Table 6.9: Status of Mechanical Meters

As on As on As on As on As on As on As on
31st 31st 31st 31st 31st 31st 31st
Status
March March March March March March December
2012 2013 2014 2015 2016 2017 2017
Balance Mechanical Meters
to be replaced by 214693 199730 183005 152560 127074 113499 78315
Electronic Meters
From the above Table, it is observed that only 35,184 mechanical meters were replaced in FY
2017-18 (upto 31.12.2017) while as per direction of the Commission issued in its Tariff Order dated
29.03.2017, the Petitioner was required to replace atleast 56,750 (i.e. half of the number of
Mechanical meters as on 31.03.2017) Mechanical Meters by 31.03.2018 which is approx. 14,000 in
each quarter.
It is an established fact that by replacing the mechanical meters with electronic meters, the
Petitioner will not only comply with the prevailing SOP Regulations but will be able to record its
energy supplied more accurately/precisely and, thus, billed energy. Therefore, the Petitioner will
have an incentive in terms of increase in its revenue if it takes all necessary steps for replacing all
remaining mechanical meters including those not covered under R-APDRP/IPDS/DDUGJY funded
schemes in a planned and time-bound program.
The Commission is of the view that the Petitioner cannot absolve itself from complying with
the provisions of the CEA Regulations on meters and directives issued by the Commission in this
regard from time to time. It has been observed that the Petitioner has invariably failed to comply
with the directions of the Commission in past with regard to replacement of Mechanical Meters by
Electronic Static Meters. It is observed that although replacement of mechanical meters with
electronic meters has been highest in FY 2017-18 (upto 31.12.2017), i.e. in last 7 years and this also
reflects Petitioner’s endeavours in this regard, however, the same requires consistent efforts for
achieving the targets as set by the Commission.

The Commission directs the Petitioner to ensure complete replacement of Mechanical

Meters by Electronic Meters well before 31.03.2019.
6.2.1.5 Ghost/Fictitious Consumers
The Commission in its previous Tariff Order dated 29.03.2017, had directed the Petitioner to
write off ghost/fictitious/non-existent consumers from its billing database under a transparent
policy framed by the Petitioner latest by 31.05.2017, failing which appropriate action under
Act/Regulations may be initiated against the concerned officers of the Petitioner including
The status of Ghost/Fictitious consumers furnished by the Petitioner in the prescribed

format 3(D) is given below:
Table 6.10: Status of Ghost/Fictitious Consumers

As on As on As on As on As on As on
31st 31st 31st 31st 31st 31st
Status
March March March March March December
2013 2014 2015 2016 2017 2017
Nos. of Ghost/Fictitious
1368 1135 892 710 397 0
Consumers
From the above Table, it can be seen that the Petitioner was able to write-off
ghost/fictitious/non-existent consumers from its billing database. The Commission is of the view
that existence of such consumers in the database prevents proper energy accounting resulting in
erroneous figures of Aggregate Technical & Commercial losses (AT&C losses).
On examination of the Commercial Performance Monitoring report submitted by the

Petitioner it has been observed that the Petitioner was able to write-off ghost/fictitious/non-
existent consumers in the month of July, 2017 and since then ghost consumers has been reported to
be ‘Nil’ in subsequent monthly reports.
Hence, the Petitioner is directed to ensure that no new ghost/fictitious/non-existent

consumers should appear in its billing database.
6.2.2 Billing
The Commission, vide its earlier Tariff Orders, and various directions issued from time to
time in this regard has been directing the Petitioner to improve its quality of billing, bill distribution
and revenue collection system. It is noted that the Petitioner has made a beginning in this direction
and has developed a system for internet based online view/payment of electricity bill besides bill
payment facility also through Common Service Centers (CSCs) situated across the State for its
consumers which has not only benefitted the consumers of the State but has also improved the
overall billing and bill collection system of the Petitioner. However, the Commission is of the view
that still a majority of consumers are located in remote hilly/rural areas and they may not avail
internet based online facilities hence, a lot of scope for improvement in billing, bill distribution and
bill collection system is required at the Petitioner’s end for consumers residing in such areas.
6.2.2.1 NB & SB Cases
The Commission, in its Tariff Order dated 29.03.2017, had taken a serious note of the
continued non-compliance by the Petitioner with regard to NB/SB cases and had decided to give
last opportunity to the Petitioner for liquidating and finalising at least 25% of the NB/SB cases latest
by 30.09.2017, failing which appropriate action under the Act/Rules/Regulations would be initiated
against the Petitioner for the continued non-compliance of the directions of the Commission.
The Petitioner, in its instant Tariff Petition under status of compliance of directives has
submitted that it has identified 1,81,026 electricity connections lying disconnected and being shown
in the data base as Not billed/Stop billed. The arrear against these connections is Rs. 570.25 Crore
in the record. UPCL has prepared an action plan to settle these cases in FY 2017-18 by Writing Off
fictitious arrears and irrecoverable arrears and to collect the recoverable amount. Field officers have
been directed to take action as per this action plan circulated vide letter No. 1843 dated 02.05.2017.
The Petitioner’s submission in the prescribed Format-4 of Commercial Performance

Monitoring Report pertaining to Not Billed (NB) and Stop Billed (SB) is being presented in the Table
given below:
Table 6.11: Status of NB & SB Cases

As on As on As on As on
Status As on 03/13 As on 03/14
03/15 03/16 03/17 12/17
No. of NB/SB NB 62800
139614 144480 152485 166877 157168
Cases SB 74660
From the above Table, it is evident that the no. of NB/SB cases has decreased only by 5.82%
in FY 2017-18 (upto 31.12.2017) w.r.t. the cases in FY 2016-17, which indicates that the Petitioner has
shown least interest in reducing these NB/SB cases. In this regard, the Commission had
categorically directed the Petitioner to liquidate and finalise atleast 25% of such cases whereas, the
trend shows no significant improvement which clearly indicates that the Petitioner has failed to
comply with the directions of the Commission. On examining the progress made by the Petitioner
in past years, it has been observed that the Petitioner has clearly failed to comply with the specific
directions of the Commission for realising atleast 25% of the NB/SB cases.
Therefore, taking a serious note on the continued non-compliance by the Petitioner with
regard to non-liquidation and finalisation of NB/SB cases, the Commission directs the Petitioner
to liquidate and finalise atleast 5% of the NB/SB cases in each quarter and submit quarterly
report before the Commission. In absence of the same, action under the provisions of
Act/Rules/Regulations may be initiated against the Petitioner.
6.2.2.2 Outstanding Arrears
The Commission in its Tariff Order dated 29.03.2017 had directed the Petitioner to make
sincere efforts in mobilizing its resources throughout the year for collection of Arrears under a
structured receivable management programme besides taking corrective actions against the
habitual defaulters.
The Petitioner in its instant Tariff Petition under status of compliance of directives has
submitted that division-wise Annual and Daily Revenue Collection Targets have been fixed for
achieving 14.75% AT&C losses.
The status of Outstanding Arrears furnished by the Petitioner in the prescribed Format- 5 is
given below:-
Table 6.12: Status of Outstanding Arrears

Description As on 03/14 As on 03/15 As on 03/16 As on 03/17 As on 10/17
Amount Amount Amount Amount Amount
Arrear No. No. No. No. No.
(Rs. Lac) (Rs. Lac) (Rs. Lac) (Rs. Lac) (Rs. Lac)
Arrear>=5 Lac 714 25794 1141 49782 1400 66890 1161 45682 1325 49945
1=<Arrear<5 Lac 4306 7747 5538 10136 3079 5345 3555 6131 4932 8499
0.5 Lac=<Arrear<1
15401 10056 15449 10475 11749 8106 13164 9214 15327 10706
Lac
0.1
Lac=<Arrear<0.5 75696 16140 88900 18846 84165 17474 89984 18867 110856 23132
Lac
0.05
Lac=<Arrear<0.1 60664 4308 69730 4951 67004 4761 78657 5563 95517 6751
Lac
Total 156781 64044 180758 94190 167397 1025767 186521 85457 227957 99032

From the above Table, it is evident that the Petitioner has not been able to reduce number of
arrear cases and rather the same are increasing on year-on-year basis and has reached to an all time
high of 2,27,957 in FY 2017-18 (upto 31.10.2017).
The Commission is of the view that the Petitioner has been lackadaisical towards collection
of arrears and lacks seriousness in laying down a planned programme/roadmap. This is a grave
concern for the financial health of the Petitioner and may weed away the Petitioner’s financial
viability since 2.27 Lakh cases of arrears (which is around 11% of the total consumers of the
Petitioner) have been pending as on 31.10.2017 with a staggering amount of Rs. 990.32 Crore
pending recovery by the Petitioner which is about 16.95% of the Petitioner’s approved Net ARR for
FY 2017-18, i.e. Rs. 5840.98 Crore.
The comparison of Outstanding Arrears furnished by the Petitioner in the above Table vis-a-
vis Outstanding Arrears shown in the Commercial Diary, i.e. CS-4 is given below:-
Table 6.13: Comparison of Outstanding Arrears (Rs. Crore)

As on As on As on As on
Description
31.03.2015 31.03.2016 31.03.2017 31.10.2017
As per Commercial Performance Monitoring report
941.90 1025.77 854.57 990.32
(excluding Arrears of amount below Rs. 5,000)
As per CS-4 report
2147.25 1789.05 1613.26 2072.12
(including Arrears of amount below Rs. 5,000)
From the above Table, it has been observed that the Petitioner has not made enough efforts
in recovering its arrears in FY 2017-18 (upto 31.10.2017) due to which the total arrear to be realized
as on 31.10.2017 as per CS-4 report is Rs. 2072.12 Crore which is more than 35% of its approved Net
ARR for FY 2017-18. Further, from the above Table, it is observed that total amount of arrears below
Rs. 5000 to be recovered by the Petitioner as on 31.03.2016 & 31.03.2017 were Rs. 763.28 Crore & Rs.
758.69 Crore respectively, which shows that the Petitioner is not only failing in collecting its high
arrear amounts (Rs. 5,000 & above) but has also failed to collect the low arrear amounts (below Rs.
5000). Moreover, on examination, it has been observed that the Petitioner was able to
liquidate/decrease its 16.68% arrear amounts in FY 2015-16 and only 9.83% in FY 2016-17 whereas,
its performance has further, deteriorated in FY 2017-18 (upto 31.10.2017) as the amount of arrears
instead of decreasing in FY 2017-18 (upto 31.10.2017) have actually increased by 28.44% which
shows that the Petitioner has not taken enough measures for early recovery of the arrears.

The Commission is of the view that the Petitioner has to understand the gravity of the
situation and should abstain from its legacy practice of remaining callous about arrears throughout
the year and waking up in the last quarter of the Fiscal Year. This by all standards in any
commercial organization is an in-appropriate practice and inculcates un-professional work culture
in the organisation especially for the young field officers who adapt the same and are misguided by
the false belief in the wrong historical practice.
Therefore, the Commission hereby directs the Petitioner to make sincere efforts in
mobilizing its resources throughout the year for collection of Arrears under a structured
receivable management programme besides taking corrective actions against the habitual
defaulters.
6.2.2.3 Load Factor of KCC Consumers
The Commission in its Tariff Order dated 29.03.2017 had directed the Petitioner that KCC
consumers having less load factor should be closely monitored and average consumption pattern
and abnormality in consumption pattern should be checked and duly analysed. The Commission
also directs the Petitioner to check KCC consumers who are repeatedly exceeding their
sanctioned/contracted demand and take corrective action in such cases.
submitted that monitoring of KCC consumers is being done on a regular basis at Key Consumer
Cell.
The load factor of the KCC consumers, as submitted by the Petitioner in the prescribed
Format-6 of Commercial Performance Monitoring Report has been shown in Table given below:
Table 6.14: Status of KCC Consumers

Description As on 03/13 As on 03/14 As on 03/15 As on 03/16 As on 03/17 As on 12/17
Total KCC Consumers 16939 18668 19997 21119 22120 22751
*Abnormal cases 2257 2554 2709 3271 3232 3518
L.F<10% 6884 7513 8430 9063 9884 9822
L.F>10% 10055 11155 11567 12056 12236 12929
*Abnormal cases- Consumers exceeding sanctioned demand, Consumers having CT, PT by-pass Tamper Report, unbalanced Tamper
Report & any other Tamper Report.
From the above Table, it can be observed that as on 31.12.2017, number of consumers having
load factor less than 10% were 9822, which is around 43.17% of the total number of KCC consumers.
To this the Commission is of the view that the consumers having load factor less than 10% are in

alarmingly high numbers. Moreover, 3518 consumers which is 15.46% of the total number of KCC
consumers are falling under abnormal cases out of which majority comprises of consumers who
have exceeded their sanctioned/contracted demand.
The Commission is of the view that the Petitioner has total billed consumer base of about
19.94 Lakh consumers in the State, out of which 22,751 consumers (Industrial category consumers
having load 5 kW & above and Commercial category consumers having load 10 kW & above) as on
31.12.2017, have been identified as Key Consumers (KCC). These key consumers which are only
about 1% of the total consumer base of the Petitioner contribute nearly 70% of its total annual
revenues.
Therefore, the Commission directs the Petitioner that KCC consumers having less load
factor should be closely monitored and average consumption pattern and abnormality in
consumption pattern should be checked and duly analysed. The Commission also directs the
Petitioner to check KCC consumers who are repeatedly exceeding their sanctioned/contracted
demand and take corrective action in such cases.
6.2.2.4 Status of Revenue realisation per unit sold
The Commission in its Tariff Order dated 29.03.2017 had directed the Petitioner to ensure
that the data furnished in Commercial Performance Monitoring report should match with its
Commercial Diary, i.e. CS-4 data and the Petitioner should ensure that in all future submissions of
Commercial Performance Monitoring reports the Average Realisation Rate should be calculated on
the basis of recoveries on account of Realisation Against energy dues only and the realisation
shown should exclude recoveries from duties/cess, etc. Further, the realisation against energy dues
should clearly bifurcate realisation against current dues & realisation against past dues.
submitted that data in Commercial Performance Monitoring report is being submitted as per
directions of the Commission. However, on examination it has been observed that despite
Commission’s specific direction that ‘Average Realisation Rate should be calculated on the basis of
recoveries on account of realisation against energy dues only and the realisation shown should
exclude recoveries from duties/cess etc. and realisation against energy dues should clearly bifurcate
realisation against current dues & realisation against past dues, the Petitioner is showing realisation

against arrears and duties/cess in its revenue realisation and calculating realisation per unit energy
sold accordingly.
The status of Revenue Realisation per unit sold furnished by the Petitioner in the prescribed
Format-7 is given below:-
Table 6.15: Status of Revenue Realisation per unit sold

Total Revenue Average Average Power Approved /Trued-
Sold Energy
Year Realization (Rs. Realization Rate Purchase Cost per up Average Cost of
(MU)
Lac)* (Rs./unit) Unit sold (Rs./unit) Supply (Rs/Unit)
FY 2012-13 8577.01 346873.32 4.04 3.78 4.23
FY 2013-14 9065.02 387651.15 4.28 3.58 4.32
FY 2014-15 9685.16 418388 4.32 3.76 4.08
FY 2015-16 10298.14 524286 5.09 4.11 4.54
FY 2016-17 10575.544 555300 5.25 4.63 4.69
FY 2017-18 -- --
6609.737 300669 4.55
(October, 2017)
*Including Duties/Cess/DPS & other recoveries
On examination, it has also been observed that in FY 2016-17, the total Revenue Realization,
i.e. Rs. 5,55,300 Lakh submitted by the Petitioner in Format-7 of Commercial Performance
Monitoring reports is actually inclusive of arrears of Rs. 43,884.90 Lakh.
The Commission again directs the Petitioner to ensure that the data furnished in
Commercial Performance Monitoring report should match with its Commercial Diary, i.e. CS-4
data and the Petitioner should ensure that in all future submissions of Commercial Performance
Monitoring reports the Average Realisation Rate should be calculated on the basis of recoveries
on account of Realisation Against energy dues only and the realisation shown should exclude
recoveries from duties/cess, etc. Further, the realisation against energy dues should clearly
bifurcate realisation against current dues & realisation against past dues, failing which
appropriate action shall be initiated against the Petitioner/Licensee.
6.2.3 Billing and Bill Collection System
Taking cognizance of various consumer complaints received by the Commission in writing

and also during public hearing, the Commission earlier had directed the Petitioner to improve its
existing Bill Collection System. Further, the Commission vide its Order dated 01.09.2005 had
imposed a consolidated penalty of Rs. 1,00,000 and recurring additional penalty of Rs. 2,500 per day

on UPCL for non-compliance of its directions with respect to bill collection system. However, not
much has improved except for new Bill Collection Centres constructed under R-APDRP schemes.
The Commission in its Order dated 07.01.2016 in the matter of Petitioner’s request on waiver
and refund of penalty imposed by the Commission vide its Order dated 01.09.2005, had held as
under:
“as a last attempt to induce Petitioner to work in right earnest for meeting the requirement of Order
dated 01.09.2005, the recovery of penalty due after 31.03.2011 is kept in abeyance till final disposal of
this Petition. A view on waiver or recovery would be taken after assessing performance of the
Petitioner on following: (a) actions taken to augment and upgrade its prevailing Bill Collection
System in order to make it consistent with the Commission’s Order dated 01.09.2005 within six
months from the date of issuance of this Order. Bimonthly report of action taken to be furnished to the
Commission. (b) actions taken to extend the bill collection facility/services integrating all the
Common Service Centers (CSC) situated across the State within six months from the date of issuance
of this Order and submit monthly progress report with number of CSCs integrated during the month
latest by 15th day of next month (c) submit comprehensive Action Plan latest by 25.01.2016 including
distinct focus/plan for Bill Collection System in rural and urban areas of the State in accordance with
the orders/direction by the Commission in this regard for effective implementation of the direction
issued at para (a) above.“
Thereafter, the Commission vide its Tariff Order dated 05.04.2016 had directed the Petitioner
to comply with the directions issued in the Commission’s Order dated 07.01.2016, failing which
appropriate action under the Act/Rules/Regulations would be taken against the Petitioner for the
continued non-compliance of the directions of the Commission. Further, the Commission had also
directed the Petitioner to expedite integrating Common Service Centres (CSCs) available in State
with its billing system under the agreement executed between UPCL & Common Service Centre E-
Governance Services India Ltd., New Delhi.
However, in the absence of compliance of the aforesaid directions, the Commission issued a
show cause notice and, thereafter, the Commission in its Order dated 11.01.2017 had observed that
the Petitioner’s response to the issue was inadequate and routine and that the Petitioner even after
an elapse of more than 11 years had failed to implement the directions of the Commission issued in
the matter of Bill Collection System. Further, the Commission in its aforesaid Order had also

observed that even after a passage of almost a year since Commission’s Order dated 07.01.2016, the
total number of CSCs integrated with UPCL’s system were only 909 which were not even 50% of the
total 2000 number of CSCs situated across the State.
Accordingly, the Commission in its Order dated 11.01.2017 had directed the Petitioner to
deposit the outstanding penalty amount from 01.04.2011 upto 30.11.2016 and continue paying daily
penalty of Rs. 2500/- within 30 days of close of the each calendar month till such time each of the
directions as given in the Order dated 09.07.2004 & 01.09.2005 of the Commission in the matter of
Bill Collection System has been fully complied with.
In compliance to the same, the Petitioner vide its letter No. 1023 dated 01.03.2017 deposited
an amount of Rs. 53,30,000/- against the penalty amount for the period from 01.04.2011 to
31.01.2017.
The Petitioner, in its instant Tariff Petition, under status of compliance of directives has
submitted that the amount of penalty paid by it upto 31.08.2017 is Rs. 1.108 Crore and on its request,
the Commission vide letter no. 1039 dated 18.09.2017 withheld the penalty for next six months
subject to completion of bill collection facilities and integration of all functional CSCs in the State by
the said period. Further, the Petitioner has submitted that tender for developing facilities at bill
collection centres have been invited and the work is expected to get completed within 6 months
from the date of the LOA.
In this regard, the Commission is of the view that the Petitioner should be cautious in
ensuring timely compliance of the directions of the Commission as the relaxation given to the
Petitioner against deposition of penalty amount is subjective and any further delay/laxity on
account of the Petitioner in this regard may result in reinstating of the penalty followed by stern
action against the Petitioner. Actively monitoring the matter, the Commission through its various
letters sought the progress of creation of new bill collection centres and integration of CSCs situated
across the State with UPCL’s system. Meetings with regard to integration of CSCs with the
Petitioner and Additional Secretary (IT), GoU were held in the Commission’s office on 21.12.2017
and 02.01.2018, wherein several pertinent issues were raised and resolved. The Commission during
the aforesaid meeting also directed the Petitioner to make widespread publicity/
Advertisement/workshop of the bill collection facilities & list of Villages Level Entrepreneurs
(VLEs) under CSC operating in the vicinity of various electricity Sub-division/division officers of

UPCL across the State. The Commission hereby directs the Petitioner to complete the works of
bill collection facilities and integration of all CSCs in the State latest by 30.04.2018, in absence of
which, stern action under the provisions of the Act/Rules/Regulations would be initiated against
it. Moreover, the Commission directs the Petitioner to make widespread publicity/
Advertisement/workshop of the bill collection facilities & list of VLEs operating in the vicinity
of various electricity Sub-division/division officers of UPCL across the State.
6.3 Energy Audit
The Commission in its earlier Tariff Orders had been reiterating its direction for conducting
the energy audit of 11 kV feeders and submit the audit report before the Commission. Moreover,
the Commission in its Tariff Order dated 29.03.2017 had directed the Petitioner to provide/maintain
the system metering at each feeder, ‘T’ points, DTs and consumers in its distribution network so
that effective energy auditing can be done. The Commission is of the view that proper energy
accounting can throw-up several actionable issues which, when addressed, shall result in marked
reduction in distribution losses in the Petitioner’s network.
submitted that all the metering points at 33 kV level has been completed in all directions except
Srinagar, Kotdwar, Rudraprayag, Gopeshwar and Narayanbagar divisions. Further, the Petitioner
has submitted that meters on DTs in 31 Towns of R-APDRP project area have already been installed
and 952 nos. of meters are proposed to be installed at existing DTs in towns other than R-APDRP
towns under IPDS Scheme for which BOQ have been finalised. Guaranteed Technical Particulars
(GTP) approval and material mobilization is under progress.
On this, the Commission is of the view that in order to have an effective energy accounting
& auditing system, metering at each feeder, ‘T’ points, DTs and consumers in a distribution network
are mandatory. Therefore, it is important to bring the entire distribution network under the ambit of
robust metering system.
Therefore, the Petitioner is directed to provide/maintain the metering system at each

feeder, ‘T’ points, DTs and consumers in its distribution network for effective energy auditing
and accounting. The Petitioner is directed to submit compliance report in this regard by
30.09.2018, failing which appropriate action may be taken against the Petitioner in accordance
with the Act/Rules/Regulations.
6.4 AT&C Losses
From the above comprehensive analysis of metering, billing & collection activities of the
Petitioner, it is evident that still a lot of improvement, especially in the areas of provisional billing,
replacement of Mechanical Meters, replacement of Defective Meters and Outstanding Arrears is
required. The AT&C losses of the Petitioner as on 31.10.2017 as per Commercial Performance
Monitoring report are 29.30%. The reason for such high AT&C loss is primarily high distribution
losses and low collection efficiency till 31.10.2017. The Commission in its previous Orders had also
categorically directed the Petitioner to ensure completion of the R-APDRP works within the
specified time lines and also to achieve the specified target for reduction of AT&C losses to the
extent of 15% in the selected towns within the stipulated timeframe for availing the benefits of
conversion of loan into grant. In case, the Petitioner fails to do so, the servicing cost/cost of the loan
in whole or part may not be allowed as pass through in the ARR. Similar directions were issued by
the Commission in its Order dated 05.10.2016 pertaining to Capital Investment for the Integrated
Power Development Scheme (IPDS) Project, Ministry of Power (MoP), Government of India (GoI).
Therefore, the Commission is of the view that with the above linkage of cost of funding with
the AT&C loss achievement, such programs can be construed as a double edged sword, which
might cause adverse financial impact in case the Petitioner fails to achieve the required reduction in
AT&C losses of the target area.
The status of AT&C losses of UPCL for the last six financial years furnished by the Petitioner
in the prescribed Format-8 is given below:
Table 6.16: Status of AT&C Losses of UPCL

Distribution Loss (%)
Distribution Loss (%)
Collection Efficiency
Assessment (Rs Lac)
Input Energy (MU)
Collection (Rs Lac)
Approved Norms)
Energy Sold (MU)
Computed AT&C
losses (Based on
Actual AT&C
Approved
Loss (%)
Year
(%)
(%)
FY 2011-12 10310.64 8252.72 315899 292757 19.96 18.00 92.67 25.82 20.46
FY 2012-13 10789.11 8577.01 356995 346873 20.50 17.00 97.16 22.76 19.49
FY 2013-14 11216.31 9065.02 393412 387651 19.18 16.00 98.54 20.36 18.10
FY 2014-15 11888.23 9685.16 418940 418388 18.53 15.50 99.87 18.64 17.19
FY 2015-16 12559.60 10298.14 493267 524286 18.01 15.00 106.29 12.85 16.28
FY 2016-17 12780.32 10575.54 540075 555300 17.25 15.00 102.82 14.92 16.28
FY 2017-18
7984.00 6609.74 352070 300669 17.21 14.75 85.40 29.30 15.82
(upto Oct,17)

It is evident from the above Table, that Petitioner’s distribution loss levels are higher than
the approved levels. Further, the actual AT&C losses for the above period are higher than computed
AT&C losses on the basis of approved level of distribution losses & collection efficiency in
respective Tariff Orders except in case of FY 2015-16, Fy 2016-17 where substantial amount of
Government dues were recovered by the Petitioner.
From the above Table, it is observed that the collection efficiency in FY 2016-17 was 102.82%,
however, on examination of the collection data vis-a-vis CS-4 data, it has been observed that the
collection of Rs. 5,55,300 Lakh as indicated in the above Table is inclusive of arrears of Rs. 43,884.90
Lakh. Whereas, for calculation of AT&C losses, the Realisation against Current Year Assessment
should only be considered and should be exclusive of arrears of previous years. It is because of this
superficial collection efficiency of 102.82% as indicated in the above Table the AT&C losses of the
Petitioner are coming to 14.92% in FY 2016-17.
The Commission is of the view that the major component of AT&C losses are the
distribution losses which basically comprises of Technical and Commercial losses. Further, the
Commission is of the view that since Technical & Commercial losses are more in LT network in
comparison to HT network, hence, it is apparent that in order to substantially reduce AT&C losses,
the Petitioner needs to strengthen its LT network. During the field visits of the officers of the
Commission in EDD- Pauri & EDD- Kotdwar, it has come to the notice that some of the villages in
rural areas of the hill district are being supplied power through GI wire instead of ACSR conductors
which are generally being used in the distribution network. In this regard, it is observed that such
installations not only contribute in increasing line losses but at the same time are hazardous
towards safety of the men and material. Moreover, the dilapidated condition of the GI wires of the
rural netwoks and improper maintenance of protection system at 33/11 kV sub-station, leads to a
situation of grave concern.
Therefore, the Petitioner is directed to indentify such feeders/spans where the power
distribution network is on GI wire and replace them with the ACSR or bettor conductors latest
by 30.09.2018 and submit a compliance report under affidavit on the same.
Moreover, the Petitioner is also directed to prepare and submit an action plan for
checking and refurbishment of protection systems at various 33/11 kV sub-stations latest by
30.06.2018.

In the following paragraphs the trend of losses in other category of consumers (excluding
HT consumers) and HT consumption in the State is being discussed.
The trend of losses in other category of consumers (excluding HT consumers) is shown in

the Chart given below:
Chart 7: Distribution Loss in consumer category other than HT consumers
From the above chart, it is observed that the losses for ‘consumers other than HT consumers’
have decreased in FY 2016-17 which shows that the Petitioner has put in some efforts in reducing
Distribution losses for other categories, however, still the losses for ‘consumers other than HT
consumers’ are almost twice the approved distribution losses which is unacceptable. Therefore,
concerted efforts are required by the Petitioner for reducing the distribution losses for the
‘consumers other than HT consumers’ also.
In light of the above, it should be the foremost endeavour of the licensee to reduce the
distribution losses at LT level within the acceptable limits. The Petitioner should take up the
following works at the earliest for reducing the AT&C losses:
1. The Petitioner must replace all mechanical meters in a time-bound manner in all the
divisions on a war footing. It is a known fact that the cost incurred in purchasing the
electronic meter shall be recovered within no time as there shall be substantial increase
in the revenue of the Petitioner.

2. The Petitioner must ensure that no ghost/fictitious/non-existent consumers existing in

its billing database.
3. The Petitioner must conduct planned regular actions for early recovery of outstanding
arrears.
4. The Petitioner must analyse KCC consumers having load factor less than 10% on a
regular basis and lay down mechanism for checking inspection/tamper
analysis/condition monitoring of MRI reports and metering equipments.
5. The Petitioner must ensure that all the meters of the consumers are read and their bills
prepared and distributed within time. The Petitioner shall also ensure that no
provisional bills namely NA/NR are issued for more than two billing cycles in
accordance with the provision of Electricity Supply Code Regulation, 2007. Divisional
head must be held accountable for not controlling provisional billings. The Petitioner
should make efforts to always issue computerized bills to its consumers requiring no
human intervention.
6. The Petitioner should prepare a time bound plan/programme to replace all the bare
overhead conductors with insulated aerial bunched conductors (AB conductor) in theft
prone areas alongwith effective monitoring mechanism for its implementation.
7. The Petitioner should also prepare a time bound plan/programme for segregation of
rural feeders into Agriculture and Non-Agriculture load basis which would be an
effective measure for segregation of theft/pilferage of electricity in Agriculture and Non-
Agricultural usage in villages/rural areas.
8. The Petitioner should make extra efforts to get the arrears realised from the defaulting
Government departments. The Commission is of the view that the Petitioner should
promote and implement the pre-paid metering so that revenue recovery can be
enhanced and problems related to accumulation of arrears is resolved.
9. Replace the GI wire based power distribution system with suitable conductor so that
technical losses in the system can be reduced and the same would also help in improving
the quality of power supply to the consumers.

10. The Petitioner have to ensure that meters are installed at each point of energy accounting
and are kept in proper working condition.
11. The Petitioner should also develop GIS based consumer indexing database in areas other
than the areas covered under R-APDRP/IPDS, which shall be helpful in providing
prompt services to consumer and shall be helpful in planning the new connections,
transformer augmentation, phase change, localising fault, supply restoration and other
services to consumers necessarily provided by any distribution utility having consumer
services orientation as its vision & mission.
6.5 Commission’s Analysis and Directions on Financial Performance
The Commission has been monitoring & reviewing the performance of the Petitioner based
on the information/reports submitted by it. The Commission in its Tariff Order dated 29.03.2017
carried out the analysis of financial performance of UPCL based on its statement of accounts in
certain key areas. In line with the same methodology, the key performance ratios after taking into
account the financial performance of UPCL in FY 2016-17 based on the audited financial statements
are detailed below.
6.5.1 Liquidity Ratio
Liquidity ratios analyzes the ability of a company to pay off both its current liabilities as
they become due as well as their long-term liabilities as they become current. In other words, these
ratios show the cash levels of a company and the ability to turn other assets into cash to pay off
liabilities and other current obligations.
Liquidity is not only a measure of how much cash a business has. It is also a measure of how
easy it will be for the company to raise enough cash or convert assets into cash. Assets like accounts
receivable, trading securities, and inventory are relatively easy for many companies to convert into
cash in the short term. Thus, all of these assets go into the liquidity calculation of a company.
6.5.1.1 Quick Ratio or Acid Test Ratio
It is the ratio of (current asset – inventories) and current liabilities. The quick ratio or acid
test ratio is a liquidity ratio that measures the ability of a company to pay its current liabilities when
they become due with only quick assets. Quick assets are current assets that can be converted to
cash within 90 days or in the short-term. Cash, cash equivalents, short-term investments or
marketable securities and current accounts receivable are considered quick assets excluding
inventories.
The quick ratio is often called the acid test ratio. The acid test shows how well a company
can quickly convert its assets into cash in order to pay off its current liabilities. It also shows the
level of quick assets to current liabilities.
Higher quick ratios are more favourable for companies because it shows that there are more
quick assets than current liabilities. A company with a quick ratio of 1 indicates that quick assets
equals current liabilities. This also shows that the company could pay off its current liabilities
without selling any long-term assets.
Chart 8: UPCL Quick Ratio from FY 2001-02 to FY 2016-17
As can be seen from above graph, UPCL’s Quick Ratio was almost 1 in the FY 2002-03 & FY
2003-04 and thereafter, shows a downward linear trend in the ensuing years, thus, showing the
Corporation’s inability to maintain its liquidity over a period of time, the primary reasons for the
same could be its inability to realise its dues from the consumers and in turn discharging the current
liabilities which are also increasing. Further, based on the financial performance of UPCL in FY
2016-17, the situation has further deteriorated and the ratio has declined from 0.35 in FY 2015-16 to
0.32 in FY 2016-17.

6.5.1.2 Current Ratio
It is the ratio of current assets and current liabilities. The current ratio is a liquidity and
efficiency ratio that measures a firm's ability to pay off its short-term liabilities with its current
assets. The current ratio is an important measure of liquidity because short-term liabilities are due
within the next year, thus, implying that a company has a limited amount of time in order to raise
the funds to pay for these liabilities. Current assets like cash, cash equivalents, marketable securities
and inventories can easily be converted into cash in the short term. This means that companies with
larger amounts of current assets will more easily be able to pay off current liabilities when they
become due without having to sell off long-term, revenue generating assets.
A higher current ratio is always more favourable than a lower current ratio because it shows
the company can more easily discharge the current liabilities. A Current Ratio of less than 1
indicates a high working capital leveraging and highly risky position since it indicates that the
Current Liabilities are not fully backed up by the Current Assets and in the event of default, the
Company may resort to selling its Assets to meet out its debts.
Chart 9: UPCL Current Ratio from FY 2001-02 to FY 2016-17
As can be seen from the above graph, apart from initial few years upto FY 2004-05, UPCL is
not able to maintain its current assets in proportion to its current liabilities, thus, showing a highly
leveraged position on the part of the Corporation. The current ratio mainly indicates that how much
times the short term liabilities are backed by the current assets, in case of UPCL as can be seen from

above graph, in the past five years UPCL is not able to maintain the said ratio to even as low as 0.5
which is way low than the industry standard of 1.
This indicates that for discharging its current liabilities, UPCL will either have to resort to
liquidating its long term assets or borrow additional working capital loans. This also is an indicator
that on one side UPCL has failed to recover its current and past dues from the consumers efficiently
and on the flip side the current liabilities have been used to finance the long term assets of UPCL.
The Commission has been pointing out towards this issue in its previous Tariff Orders that assets
are being financed through current liabilities. UPCL has been claiming every year that internal
resources are being used to finance certain asset additions. The internal resources in UPCL’s case
are nothing but funds which should have been used to discharge its current liabilities like Govt.
Dues (Royalty, duties, PDF etc), instead have been utilised in creation of long term assets.
In this regard, the Petitioner is directed to carry out the age-wise analysis of its current
liabilities outstanding as on 31.03.2017 and based on the ageing analysis determine how much of
the same would be required to be discharged and how much excess provision exists in the same
so that the same may be reversed and submit the same to the Commission within 3 months from
the date of Order.
6.5.1.3 Operating Cash Flow Ratio
It is the ratio of cash flow from operation and the current liabilities. It is a measure of how
well current liabilities are covered by the cash flow generated from a company's operations.
The operating cash flow ratio can gauge a company's liquidity in the short term. Using cash flow as
opposed to income is considered a cleaner, or more accurate measure to analyse the financial health
of a company & also its operations. The operating cash flow ratio is a measure of the number of
times a company can pay off current debts with cash generated in the same time period. A higher
number means a company can cover its current debts more times, which is a good thing.
Companies with a high or increasing operating cash flow ratio are in good financial health. Those
that are struggling to cover liabilities may be in trouble, at least in the short term.

Chart 10: UPCL Operating Cash Flow Ratio from FY 2008-09 to FY 2016-17
As can be seen from the above graph, cash flow from operating activities is hardly able to
meet its current liabilities. UPCL is struggling to cover its current liabilities, at least in the short
term. In FY 2009-10 and FY 2011-12, cash flow operating ratio is negative due to huge losses on
account of high distribution losses and poor collection efficicency resulting into negative Cash flow
from Operating Activities. Further, in FY 2016-17 this ratio has dipped down to 0.02 from 0.08 in FY
2015-16. In all the years the ratio is less than 1 which indicates that the company has generated
less cash in the period than it needed to pay off its short-term liabilities. This may signal a need for
more capital.
6.5.2 Solvency Ratio
Solvency ratios, also called leverage ratios, measures a company's ability to sustain
operations indefinitely by comparing debt levels with equity, assets, and earnings. In other words,
solvency ratios identify going concern issues and a firm's ability to pay its bills in the long term.
Solvency ratios focusses more on the long-term sustainability of a company instead of the current
liability payments. Better solvency ratios indicate a more creditworthy and financially sound
company in the long-term.

6.5.2.1 Interest Coverage Ratio
It is a ratio of EBIT (operating Income) during a given period and the amount a company
spends in interest payment on its debts during the same period. The interest coverage ratio is used
to determine how easily a company can pay interest on outstanding debt. Essentially, the interest
coverage ratio measures how many times over a company could pay its current interest payment
with its available earnings. In other words, it measures the margin of safety a company has for
paying interest during a given period, which a company needs in order to survive future (and
perhaps unforeseeable) financial hardship should it arise. A company’s ability to meet its interest
obligations is an aspect of a company’s solvency, and is, thus, a very important factor in
the return for shareholders. The lower a company’s interest coverage ratio is, the more its debt
expenses burden on the company. When a company's interest coverage ratio is 1.5 or lower, its
ability to meet interest expenses may be questionable. 1.5 is generally considered to be a bare
minimum acceptable ratio for a company and a tipping point below which lenders will likely refuse
to lend the company more money, as the company’s risk for default is too high. Moreover, an
interest coverage ratio below 1 indicates the company is not generating sufficient revenues to
service its interest expenses. If a company’s ratio is below 1, it will likely need to spend some of its
cash reserves in order to meet the difference or borrow more, which will be difficult for reasons
stated above. Otherwise, even if earnings are low for a single month, the company risks falling
into bankruptcy. Generally, an interest coverage ratio of 2.5 is often considered to be a warning
sign, indicating that the company should be careful not to dip further.
Chart 11: UPCL Interest Coverage Ratio from FY 2001-02 to FY 2016-17

As can be seen from the above graph, UPCL was suffering losses in most of the financial
years and was hardly able to meet its interest liability. The standard ratio is 1.5 times and it can be
seen from the above graph, that only in FY 2013-14 UPCL earned sufficient profit to maintain the
ratio above the standard ratio.
6.5.3 Profitability Ratio
Profitability ratios compares income statement accounts to show a company's ability to

generate profits from its operations. Profitability ratios focus on a company's return on investment
in inventory and other assets. These ratios basically show how well companies can achieve profits
from their operations. Profitability is also important to the concept of solvency and going concern.
6.5.3.1 Return on Total Assets
It is a ratio of EBIT during a given period and average Fixed Assets. The ratio is considered
to be an indicator of how effectively a company is using its assets to generate earnings before
contractual/statutory obligations are paid. The greater a company's earnings in proportion to its
assets (and the greater the coefficient from this calculation), the more effectively that company is
said to be using its assets. This ratio allows to see the relationship between organisation’s resources
and its income, and it can provide a point of comparison to determine if an organization is using its
assets more or less effectively than it had done previously.
Chart 12: UPCL Return on Assets Ratio from FY 2001-02 to FY 2016-17

As can be seen from the above graph, UPCL earnings through its operations is not in parity
with the investment made in building up its fixed assets over a period of time.
6.5.3.2 Gross Margin Ratio
Gross margin is the difference of average sales revenue and the average direct cost, ie.
Power purchase cost in case of the Petitioner. Accordingly, gross margin ratio is the ratio of gross
margin and the operating expenses of the company. Higher gross margin ratios are more favorable
indicating that the company will have more money to pay its operating expenses.
Chart 13: UPCL Gross Margin Ratio from FY 2001-02 to FY 2016-17
As can be seen from above graph, UPCL is having a positive gross margin ratio except for
FY 2009-10. This indicates that the company is able to sell power at a rate higher than the
procurement cost of the same, however, the overall ratio is not on the much higher side, with a
maximum going upto 0.51 in FY 2002-03, indicating that the company would be left with meagre
funds to meet its operational cost other than power procurement expense, and may land up in
facing losses over a period of time.
6.5.4 Operating or Activity Ratio
6.5.4.1 Repair & Maintenance to Net Fixed Assets
The maintenance expense to fixed assets ratio allows to understand the age or condition of
the company's equipment. An increase to a company's repairs and maintenance expense to fixed

assets ratio over time can signal ageing equipment or assets that are being pushed to their operating
limits.
Chart 14: UPCL R&M to Net Fixed Asset Ratio from FY 2001-02 to FY 2016-17
It can be seen from the above graph, that UPCL is incurring R&M expenses on an average of
3% of the Net Fixed Assets. UPCL appears to be performing fairly on this ratio aspect merely on
account of the reason that it has been continuously receiving funds (grants) from GOI under various
schemes of MOP, GOI namely APDRP, RAPDRP, IPDS etc. which besides covering development of
new substaions/lines also include funding on augmentation/strengthening of old/existing assets,
thus, reducing the requirements of Repair & Maintenance of old assets, as the same are either
replaced by new assets or are augmented & strengthened.
6.5.4.2 Repair & Maintenance to Inventory Ratio
This ratio depicts the relation between the R&M expenses to Net Inventory maintained by
the Corporation. In case of UPCL, being an Electricity Distribution Company, the inventory is not
converted into sales as part of the operations carried out by the entity. Further most of the project
works are getting done by the Corporation on turn-key basis, wherein the material and labour is
supplied by the Contractor, thus denying the need for maintenance of inventory for said purpose.
The maintenance of inventory would be required by the Corporation for the purposes of meeting its
requirement of Repair & Maintenance works as may be carried out from time to time during the
course of its operation. In view of the above, the calculation of inventory turnover ratio would not
hold good for the discoms like UPCL wherein the inventory is being maintained not for the
purposes of sale, but to meet out the expenses arising in the course of operation. Hence, a
customized ratio has been worked upon to analyse the relation between the inventories maintained
by the entity and how much of the same is being actually used during the year for meeting the
R&M expenses while carrying out the operations of the entity.
The formulae for the same is as follows: R&M Expenses/Average Inventory.
Chart 15: UPCL R&M to Inventory Ratio Trend from FY 2001-02 to FY 2016-17
As can be seen from above graph UPCL is having an average inventory ratio between 0.30 to
0.40, which indicates that almost 40% of the average inventory maintained by the company is being
consumed for meeting out the R&M expenses during the year which also suggests that inventory
being maintained by UPCL is at a very high level. The capital inventory of Rs. 307.97 Crore as on
31.03.2017 is very high considering the net additions to the GFA of Rs. 238.29 Crore during FY 2016-
17 and R&M expenses of Rs. 113.70 Crore during the year. The Commission finds inventory levels
maintained by UPCL as very high.
As can be seen from the above graph, during FY 2015-16 & FY 2016-17 the aforesaid ratio has
shown an absurd variation. This is because of the reason that in both FY 2015-16 and FY 2016-17,
UPCL has shown nil inventory under Current Assets in its audited financial statements, rather it
had shown the entire amount under the Fixed Assets as inventory for Capital Works.
In this regard, UPCL has given disclosure in its audited financial statements for showing the
entire inventory under Fixed Assets as reproduced below:

“Based on the consumption pattern of inventory comprising of stores and spares in the past, company
is of the view that substantial portion of such inventory shall be consumed in future for
construction/erection of the capital assets. Since the identification/determination of inventory to be
consumed for other than capital purpose is not possible at this stage, the whole inventory of stores and
spares has been classified as "Inventory for Capital Works.
The company has not identified any obsolete, slow moving and dead stock except for those lying in the
Centralised Stores Division as all the items in the store are useable in spite of the fact that they are
very old.”
It appears that inventory levels have been so maintained so as to consume them in future for
construction/erection of the capital assets. For future consumption maintaining such inventory
level is a risky proposition as not only funds are blocked in purchasing the inventory but also the
inventories carry holding costs. There is also a risk of loss/damages and obsolescence in technology
if the inventories remain in stock for a long period of time as in power sector technologies are
evolving with time.
Considering this as a prima-facie lapse on the part of the Petitioner with regard to
inventory management, the Petitioner is directed to submit the following details within one
month of the date of Order failing which appropriate action will be initiated under the Act:
a) List of inventory as on 31.03.2017.

b) The accounting policies adopted in measuring inventories, including the cost
formula used;
c) Basis on which inventories issued: FIFO/LIFO/etc. and reason for choosing the same.
d) Whether any inventory classification, such as ABC analysis has been done? If yes the
same may be submitted and if no, reason for the same may be furnished?
e) Whether the inventories are verified physically? If yes, the periodicity of the same,
alongwith the report of last physical verification. If physical verification is not being
conducted reasons for the same?
6.5.5 Efficiency Ratio
The efficiency ratio is typically used to analyze how well a company uses its assets and
liabilities internally. An efficiency ratio can calculate the turnover of receivables, the repayment of
liabilities, the quantity and usage of equity, and the general use of inventory and machinery.
6.5.5.1 Average Collection Period
Number of days of receivable represents collection period or age of receivables for

distribution utilities. This measures effectiveness of a distribution utilities credit and collection
efforts in allowing credit to customers, as well as its ability to collect cash from them. This
comparison is used to evaluate how long customers are taking to pay a company. A low figure is
considered best, since it means that a business is locking up less of its funds in accounts receivable,
and so can use the funds for other purposes. Also, when receivables remain unpaid for a reduced
period of time, there is less risk of payment default by customers. It is calculated based on the
following formulae:
Average Collection Period: 365x(Average account receivables÷Revenue from sale of power).
Chart 16: UPCL Number of days of Receivable from FY 2001-02 to FY 2016-17
Although, the collection period of receivables of UPCL shows a trend of improvement, it has
come down from 520 days in FY 2004-05 to 121 days in FY 2016-17, yet it is moderately high as
compared to the national average of receivables in FY 2013 of 117 days. The collection period of 121
days reflects that UPCL takes almost 4 months to collect its dues. This is an area of concern and
needs immediate and corrective action. There are other utilities in the country which have a
collection period of less than 60 days. The Petitioner is directed to submit within 3 months, an
action plan to improve its collection period.

6.5.5.2 Collection Efficiency Ratio
The Collection efficiency ratio represents the efficiency and effectiveness of the dues
recovery processes of the entity on periodic basis. With respect to power distribution/retail sector, a
higher ratio represents that there are well established procedure for recovery mechanism and the
sales of the company are being channelled through metered connections. On the contrary, a lower
ratio may represent a very lenient approach of the Corporation in recovering its due from the
consumers and lack of stringent processes to deal with the defaulting consumers.
The Commission in its MYT Order dated 05.04.2016, while approving the Business Plan of
UPCL for second control period, has approved the collection efficiency for FY 2017-18 as 98.75%.
In the present case, the Commission has calculated the Collection Efficiency ratio of UPCL
for FY 2017-18 (Apr’17 to Nov’17) under the four broad Tariff categories, viz. Domestic Consumers,
Non-Domestic Consumers, Industrial Consumers and Govt. Utilities, based on the CS-4 report
submitted by UPCL.
The Collection Efficiency ratio has been calculated based on the following formulae =
Realisation of (Current Assessment+Arrears)÷Current Assessment
Chart 17: UPCL Collection Efficiency for FY 2017-18 (April’17 to November’17)
As can be seen from the above graph, compared to overall Collection Efficiency approved by
the Commission for FY 2017-18 of 98.75%, UPCL has not been able to meet the same in any of the
months in FY 2017-18 (April’17 to November’17). Further as can be seen from above, the rising

graphs on monthly basis clearly indicates that during the initial months of the year the collection
efficiency ranges between 50% to 60%, which is gradually increasing towards the later parts of the
year. Moreover, as far as collection from Govt. Utilities is concerned, the same too lower in the
initial months and going upto maximum of 40% in the month of November of the current financial
year.
This trend clearly shows that the organization will be facing financial crunches during the
initial months due to lack of adequate collection, and may have to resort to outside borrowings to
meet the cost of operations. This in turn will lead to imposition of additional financial burden on the
organization in the form of interest cost and ultimately the effect of inefficiency would have to be
borne by the consumers. If proper measures to ensure the timely collection of revenues from the
consumers is taken right from the beginning and also timely action against the defaulters are taken
then a discipline in collections could have been maintained and the required funds to meet the
operational needs of the organization would be readily available in the form of revenue from sales
at no extra cost.
It has been observed based on the Petitions submitted by the UPCL and also on the basis of
audited financial statements of various years, that UPCL has been resorting to over draft (OD)
funding at high rate of interest to meet its operation cost which could surely be avoided if a proper
discipline in collection of the assessed revenue is maintained on periodic basis. In this regard, the
Commission directs UPCL to submit a plan to demonstrate as to how it will work in the direction
of improving its actual collection so that the gap between the actual collection efficiency and the
collection efficiency approved by the Commission may be brought to minimum.
6.5.6 Conclusion
After analyzing the data related to the Petitioner’s Commercial Performance, it is concluded
that the Petitioner has to take immediate action in eliminating Ghost consumers, Provisional billing
cases (NA/NR/IDF), replacing mechanical meters which are adversely inflicting upon the
Petitioner’s commercial & financial viability.
The performance improvement can be done by judiciously allocating the responsibilities in

field as well as at Corporate level. Moreover, the Petitioner should understand the significance of
Commercial Performance Monitoring Reporting mechanism and should bring sincerity in its

approach towards it. Further, a sense of belongingness/ownership has to be inculcated in every

employee of the Petitioner’s Organisation.
Further, it is imperative to highlight that the Commercial Performance Reporting

mechanism not only brings transparency in the system but also is an eye-opener for the Petitioner
for taking timely corrective actions. Therefore, authenticity of reports is of paramount importance.
The Petitioner is required to strengthen its Commercial Wing so that timely authentic reports are
furnished to the Commission and it shall also help in prompt dissemination of information within
the organization which shall be beneficial for the Petitioner as well as for consumers of the State.
Considering the business spread of the Petitioner among its constituent divisions, the
Commission is of the view that performance monitoring of the Petitioner should be done at its each
Distribution Division levels. For this purpose, it is imperative that Division-wise target setting on
each parameter should be provided by the Petitioner in the first month of the Fiscal Year itself, so
that the whole Technical & Commercial monitoring process becomes meaningful with conclusive
inference on quantitative improvement on month on month basis.

7. Commission’s Directives
The Commission in its previous Orders had issued a number of specific directions to the
Petitioner with an objective of attaining operational efficiency, efficient manpower deployment and
streamlining the flow of information. These objectives would be beneficial not only for the sector
but also for the Petitioner’s company, both in terms of short and long term perspective. These
directions aim at creating a conducive, competitive and healthy environment for the Petitioner to
provide good quality of electricity supply and service to the consumers of Uttarakhand at optimum
and affordable costs. This Chapter deals with the compliance status and the Commission’s views
thereon on the directives issued vide Multi Year Tariff Order for FY 2016-17 dated April 5, 2016,
APR Order for FY 2016-17 dated March 29, 2017 as well as the summary of new directions (given in
preceding Chapters of this Order) for compliance and implementation by the Petitioner.
7.1 Compliance to the Directives Issued in Tariff Order for FY 2017-18 dated
March 29, 2017
7.1.1 Performance Report
The Commission directed the Petitioner that any wrong reporting/anomalies under
affidavit in its submissions would not be accepted and repetition of such errors may result in action
against the Petitioner under the provisions of Act/Rules/Regulations.
The Commission again directed the Petitioner to submit monthly Commercial Performance
Monitoring reports strictly in the prescribed formats on regular basis, so as to reach the Commission
latest by 25th day of the following month.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that the
observation on wrong reporting was for two different figures of unmetered consumers as on March
31, 2015. These different figures were reported by the field units in their two different submissions.
The Petitioner also mentioned that that as per direction of the Commission, further submission shall
be made as per the data shown in monthly commercial performance monitoring reports.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner as follows:

The Commission directs Petitioner to submit monthly Commercial Performance

Monitoring reports strictly in the prescribed formats on regular basis, so as to reach the
Commission latest by 25th day of the following month and without fail furnish the Quarterly
Targets as per prescribed Format - 2 & 3 alongwith the Commercial Performance Monitoring
report for the month of April, 2017.
Petitioner’s Submissions
In compliance to the above directions, the Petitioner submitted the said report for the month
of July, 2017 has been submitted to the Commission vide UPCL’s letter no.
4256/UPCL/RM/UERC-10, dated 16-10-2017. Quarterly targets of performance(replacement of
Mechanical Meters, defective meters and reduction in NA/NR Cases) in prescribed format 2 & 3
has also been submitted to the Commission vide UPCL’s letter no. 2789/ UPCL/ RM/ UERC-10,
dated 07-07-2017. As regards replacement of Mechanical Meters, defective meters and reduction in
NA/NR Cases, the Petitioner submitted that the Officers of the Company at various levels are
doing efforts but the desired results could not be achieved mainly due to shortage of manpower
and therefore a tender for replacement of mechanical meters and defective meters was floated in
July, 2017 which is under finalization. The target to maintain the level of defective meters below 3%
in all the areas (Urban and Rural) will be achieved by the end of September, 2018. Similarly, all the
Mechanical Meters shall be replaced by the end of September, 2018. Field Officers have been
directed to reduce NA / NR Cases i.e. below 2% in both hilly and plain areas as per direction of the
Commission.
The Commission has noted the submissions of the Petitioner. The Commission observes that
the Petitioner has not been punctual in its submissions of monthly reports. The Commission directs
the Petitioner to submit the monthly as well as quarterly status report as per the directions of the
Commission by 10th of following month/quarter without fail.
7.1.2 Sales
The Commission directed the Petitioner to issue instructions to the field offices to record the
sales of the departmental employees based on meter reading and submit compliance of the same
alongwith each APR/Tariff Petition.
The Commission directed the Zonal Chiefs, the Circle Chief and the Executive Engineers to

examine the data pointed out with reference to their Divisions for FY 2014-15 and submit the
justification to the Commission within 45 days of the date of Order on the above discrepancies
failing which action may be initiated against them individually by the Commission under Section
142 of the Electricity Act, 2003.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that UPCL, vide its
letter no. 1575/UPCL/RM/C-12, dated 18.05.2016 directed its field officers to record the sales of
departmental employees based on meter reading and 4613 Departmental Employees/Pensioners
have been ledgerized so far.
UPCL also submitted that the Field officers have been directed to take action as per the
directions of the Commission with regard to deficiencies pointed out in the Commercial Data for FY
2014-15. They have also been directed to submit the compliance report as per the direction of the
Commission.
The Petitioner further submitted that it is in the process to get its billing information
verified, i.e. Input Energy, Billed Energy, Assessment and Collection for FY 2015-16. UPCL vide its
letter no. 1061/UPCL/CE/CCP-II/15/2016-17(Feedback), dated November 21, 2016 awarded the
work to M/s Feedback Infra Private Limited, New Delhi. The work has been targeted to be
completed within six months from the date of work order.
The Commission in its APR Order dated March 29, 2017 provided final opportunity to
UPCL to rectify such errors and, accordingly, directed UPCL to rectify such anomalies else the
Commission would examine the matter and if required necessary corrections to this extent would
be made in the subsequent years. Further, the Zonal Chiefs, the Circle Chiefs and the concerned
Executive Engineers are hereby directed to examine the data with reference to their Divisions for FY
2014-15 and for FY 2015-16 and submit the justification to the Commission within 45 days of the
date of Order on the above discrepancies failing which action may be initiated against them
individually by the Commission under Section 142 of the Electricity Act, 2003 and also against the
Directors of the Petitioner Company. The Commission further directed UPCL to submit the findings
of the study being carried out on sales, average load factor, average billing rate for FY 2015-16. The
Commission also directed UPCL to meter all these consumers and submit compliance report within
one month from the date of this Order and also submit the bills for 132 unmetered domestic
consumers raised during FY 2015-16 within 30 days of the date of Order. The Commission further

directed UPCL to meter all the consumers and submit the bills for 228 unmetered PTW consumers
raised during FY 2015-16 within 30 days of the date of Order.
Petitioner’s Submission
In compliance to the above directions, the Petitioner submitted that the matter was
discussed by the Director (Operation) with the field officers and during discussions it was observed
that the discrepancies in the commercial data is mainly due to the reason that at the time of revision
of bills pertaining to prior period, amount is reduced from the assessment but the corresponding
consumption is not reduced from the billed units.
As regards the summary of findings of the study, the Petitioner submitted that UPCL vide
its letter no. 1061/UPCL/CE/CCP-II/15/2016-17(Feedback), dated 21-11-2016 had awarded the
work to M/s Feedback Infra Private Limited, New Delhi. The consultant submitted its final report
in August, 2017. The findings of the consultant are as follows:-
Table 7.1: Findings of UPCL’s Consultant on Sales Audit for FY 2015-16

Particulars As per Consultants report As per Commercial Diary
Billing Efficiency 81.67% 81.99%
Collection Efficiency 106.60% 106.29%
AT&C Loss 12.94% 12.85%
The Petitioner further submitted that there is only minor difference in the actuals as
compared to Consultants findings.
As regards metering of all consumers, the Petitioner has submitted that all consumers of
domestic and PTW Categories have been metered. Further, with regard to bills of unmetered
domestic and PTW connections, the Petitioner submitted that the bills of unmetered domestic and
PTW Consumers raised in FY 2015-16 have been submitted to the Commission vide UPCL’s letter
no. 2014/UPCL/RM/C-13, dated 15.05.2017 and no. 2618/ UPCL/RM/C-13, dated 28.06.2017.
The Commission has noted the submissions of the Petitioner. The Commission as discussed
in Chapter 3 of this Order while approving sales for FY 2016-17 observed similar anomalies in the
ABR of PTW category wherein the ABR was less than the energy charge. The Commission has
therefore carried out necessary adjustment in the revenue and sales in this regard. However, the
Petitioner is directed to instruct its field offices to carry out the corresponding corrections in

sales also in cases where billing is withdrawn. In future if such instance comes to the knowledge
of the Commission, punitive action under Section 142 of the Electricity Act, 2003 may be taken
against the errant officers of UPCL.
7.1.3 Load Shedding
The Commission directed the Petitioner to obtain the prior approval of the Commission for
load shedding to be carried out continuously for certain number of hours in a day for 15 or more
days.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that no load
shedding has been carried out by UPCL in any area continuously for certain number of hours in a
day for 15 or more days and prior approval of the Commission shall be obtained as and when
required as per the direction of the Commission.
The Commission directs the Petitioner to obtain the prior approval of the Commission for
load shedding to be carried out continuously for certain number of hours in a day for 15 or more
days.
Petitioner’s Submission
In compliance to the above directions, the Petitioner submitted that no load shedding has
been carried out by UPCL in any area continuously for certain number of hours in a day for 15 or
more days. Further, prior approval of the Commission shall be obtained as and when required as
per direction of the Commission. The Petitioner has further stated that UPCL has also prepared a
policy on power cuts. The policy was approved by the Board of UPCL in the meeting held on
23.07.2015 and the Petitioner has also submitted to the Commission.
The Commission has taken note of the Petitioner’s reply. The Commission, hereby, once
again directs the Petitioner to obtain the prior approval of the Commission for load shedding to
be carried out continuously for certain number of hours in a day for 15 or more days.

7.1.4 AT&C Losses
The Commission directed the Petitioner to regularly incorporate monthly target level
alongside actual level of Distribution losses as directed by the Commission vide its Order dated
March 4, 2013 in the Petitioner’s future submissions.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that Division wise
monthly targets of distribution losses has been fixed by Corporate Office and circulated to the field
officers vide UPCL’s letter dated July 29, 2016.
The Commission directs the Petitioner to regularly incorporate monthly target level
alongside actual level of Distribution losses as directed by the Commission vide its Order dated
March 4, 2013 in the Petitioner’s future submissions.
In compliance to the above directions, the Petitioner submitted that the division wise target
of distribution losses for FY 2017-18 has been fixed and circulated to the field officers. These targets
have also been submitted to the Commission alongwith the Commercial Performance Report.
The Commission has taken note of the Petitioner’s reply. As discussed in Chapter 3 of this
Order, the distribution losses in case of EDD, Narayanbagar, Rudraprayag, Roorkee, Bageshwar,
Vikasnagar, Uttarkashi, EDD, Dharchula are still above 30%. The Commission directs the
Petitioner to submit division wise action plan to reduce the losses in the above divisions to
below 20% within one month from the date of issuance of this Order.
The Commission further with regard to relaxtion sought by the Petitioner in distribution loss
is of the view that UPCL’s inaction and continuous high level of inefficiency does not allow it to
seek revision of the loss trajectory approved by the Commission, which if allowed would defeat the
intent of the MYT framework. Accordingly, the Petitioner is directed to abstain from seeking
relaxation in this regard in every ensuing Tariff Petition once the issue has been settled by the
Commission.

7.1.5 Power Purchase Quantum and Cost
The Commission directed the Petitioner to restrict the net drawal from the grid within its
drawal schedules in order to ensure grid discipline.
The Commission directed the Petitioner to seek prior approval of the Commission, in case
the variation in power purchase quantum or power purchase cost in any quarter exceeded by more
than 5% of the approved power purchase quantum and cost for the respective quarter worked out
on pro-rata basis from the total approved quantity and cost for FY 2016-17 as indicated in the Table
5.6 of the Order, failing which, the Commission may disallow such additional power purchase cost
while truing up the ARR for FY 2016-17.
The Commission directed the Petitioner to prepare its power purchase plan for the next
three years and initiate the bidding process to meet the deficit, if any. The Petitioner was directed to
submit an action plan in this regard within 15 days of the date of the Order. The Petitioner was also
directed to ensure compliance of the Regulations issued by the Commission from time to time,
failing which any consequent liability would be to the account of the Petitioner.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that it is restricting
its net drawal from the grid within the net drawal schedules. However, in case of excess demand
over availability, overdrawal is made within permissible limit to comply with the directions of the
Commission and in the interest of grid discipline.
The Commission in its APR Order dated March 29, 2017 taking serious note of the non
compliance of earlier direction directed the Petitioner to seek prior approval of the Commission, in
case the variation in power purchase quantum or total power purchase cost in any quarter exceeds
by more than 5% of the approved power purchase quantum and cost for the respective quarter
worked out on pro-rata basis from the total approved quantum and cost for FY 2017-18, failing
which, the Commission may disallow power purchases so made while Truing up the ARR for FY
2017-18.
In compliance with the above directions, the Petitioner submitted that the details of
approved and actual power purchases for the first quarter of FY 2017-18 were submitted to the

Commission vide UPCL’s letter no. 3442/UPCL/UERC, dated 22.08.2017. The details of which are
as under:
Table 7.2: Power Purchase for 1st Quarter of FY 2017-18 as

submitted by the Petitioner
S. No. Particulars MU Rs. Crore
Power Purchase approved in the Tariff 3726.23 1133.53
1.
Order
2. Power Purchase allowed up to 105% of ‘1’ 3912.54 1190.21
3. Actual power purchase 3596.46 1061.83
The Petitioner submitted, the actual power purchases were less than the approved power
purchases during second quarter of FY 2017-18. The actuals of power purchases for the third
quarter of FY 2017-18 are being compiled and approval shall be sought if the actuals of power
purchases exceeds by more than 5 % of the approved power purchases.
The Commission directs the Petitioner to seek prior approval of the Commission, in case
the variation in power purchase quantum or total power purchase cost in any quarter exceeds by
more than 5% of the approved power purchase quantum and cost for the respective quarter
worked out on pro-rata basis from the total approved quantum and cost for FY 2018-19, failing
which, the Commission may disallow power purchases so made while Truing up the ARR for FY
2018-19.
The Commission in Chapter 3 of this Order had observed that the Petitioner has utilised
professional service for cost effective power procurement and the Commission has considered the
additional cost on this account, however, since professional services have been availed therefore,
the Commission directs the Petitioner that it should neither overdraw power at frequency below
49.90 Hz nor resort to load shedding due to improper procurement planning. Further, any drawal
below 49.90 Hz shall not be allowed by the Commission.
7.1.6 Fixed Assets Register
The Commission directed the Petitioner to expedite the process and submit the Fixed Assets
Register updated upto 31.3.2015 within 3 months of the date of the Order and Fixed Assets Register
updated upto 31.3.2016 within 6 months of the date of the Order.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that Fixed Assets
Registers of UPCL were being prepared from M/s L.B. Jha & Co., Chartered Accountants, Kolkata

for FY 2001-02 to FY 2012-13 and were submitted to the Commission. The Pettioner submitted that
the Fixed Assets Register for FY 2013-14 & FY 2014-15 was expected to be completed by the end of
March, 2017 and fixed assets register for FY 2015-16 shall be prepared immediately after the
finalisation of Fixed Assets Registers for FY 2013-14 & 2014-15.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to expedite
the process and submit the Fixed Assets Register updated upto 31.3.2014 within 3 months of the
date of the Order and the Fixed Assets Register updated upto 31.3.2015 within 6 months of the date
of this Order.
In compliance with the above directions, the Petitioner submitted that the Fixed Assets
Registers of UPCL were being prepared from M/s L.B. Jha & Co., Chartered Accountants, Kolkata
for FY 2001-02 to FY 2012-13 and were submitted to the Commission.
Due to imposition of Model Code of Conduct in State of Uttarakhand from 04.01.17 to

15.03.17, New Tender for Preparation of Fixed Asset Register of UPCL for the FY 2013-14 to FY
2015-16 could not be floated. Tender was called on 18.03.2017 and the due date of opening was
11.04.17. The tender was extended 3 times to 25.04.17, 06.05.17 and 17.05.17 as 1 party had only
applied for the same till 06.05.17. Finally, Part I was opened on 17.05.17 and Part II on 29.05.17.
The Petitioner submitted that M/s RSA & Co., Chartered Accountants has been awarded the
work on 30.06.2017 for Preparation of Fixed Assets Registers of UPCL for FY 2013-14, FY 2014-15 &
FY 2015-16 with time target of 6 months upto the end of December 2017. The firm has updated the
Fixed Assets Register for FY 2013-14 to FY 2015-16 of all the units under Electricity Distribution
Circle, Rudrapur and for FY 2013-14 and 2014-15 of Urban Distribution Division (South), Dehradun.
The CA firm has assured that they shall submit the Fixed Asset Registers for all the Divisions within
the prescribed time i.e. before 31.12.2017.
Further, the Work order for updation of Fixed Assets Register for FY 2016-17 has also been
issued to the same CA firm with time target of 15.02.2018 for completion. Thereafter, the exercise of
checking and verifying the FAR submitted by M/s RSA & Co. shall be done and so, Fixed Asset
Registers of UPCL for FY 2013-14 to FY 2016-17 shall be completed in all respect for onward
submission to the Commission by 31.03.2018.

The Commission has taken note of the compliance on Fixed Asset Register. The Commission
observes that the Petitioner has not submitted the fixed asset register for FY 2013-14 and FY 2014-15.
The Commission, hereby, once again directs the Petitioner to expedite the process and submit
the Fixed Assets Register updated upto 31.3.2016 within 1 months of the date of the Order and
the Fixed Assets Register updated upto 31.3.2017 within 3 months of the date of this Order and
start preparation of Fixed Asset Register for FY 2017-18.
7.1.7 Depreciation
The Commission directed the Petitioner to maintain proper Fixed Asset Register showing
amongst others the date of capitalisation of each asset, their location, alongwith the accumulated
depreciation on the same and submit the same along with the next Tariff filings and also claim
depreciation based on the rates as specified in the Regulations for each class of asset.
Registers of UPCL were prepared from FY 2001-02 to FY 2012-13 by M/s L.B. Jha & Co., Chartered
Accountants, Kolkata in which the details as required by the Commission were not available.
The Petitioner also submitted that the instructions have been issued to field units to
maintain records of Fixed Assets in the manner prescribed by the Commission, so that the desired
details can be incorporated in the Fixed Assets Registers.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to maintain
proper Fixed Asset Register showing amongst others the date of capitalisation of each asset, their
location, along with the accumulated depreciation on the same and submit the same along with the
next Tariff filings and claim depreciation in line with its practice followed in the accounts.
In compliance to the above directions, the Petitioner submitted that the Fixed Assets
Registers of UPCL were prepared from FY 2001-02 to FY 2012-13 by M/s L.B. Jha & Co., Chartered
Accountants, Kolkata in which the details as required by the Commission were not available. The
Petitioner also submitted that the instructions have been issued to field units to maintain records of
Fixed Assets in the manner prescribed by the Commission, so that the desired details can be
incorporated in the Fixed Assets Registers. The Petitioner further submitted that Depreciation has
been claimed in the Petition as per the direction of the Commission.
The Commission has noted the submissions of the Petitioner.
The Commission directed the Petitioner to look into the issue of creating long term assets
from current liability and take appropriate remedial action for correcting this practice. Further, the
Petitioner was directed to expedite the matter and submit the details of assets created by mode
other than loan/grants/subsidies/deposit works/consumer contributions from FY 2001-02
onwards and submit the source of such finances duly validating the same from their cash flow and
fund flow statements from FY 2001-02 within 3 months of issue of the Order.
are created out of various sources like loans from various Financial Institutions, Grants, Deposits
and Internal Resources (including Equity). The fund received towards Security Deposit from
Consumers as well as Retention money from Suppliers/Contractors are also utilised for creation of
Fixed Assets, which are clubbed under the heading of “Other Current Liabilities”. Therefore, a
portion of Fixed Assets are also created through Current Liabilities, which is shown under “Internal
Resources”.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to take note
of the findings of the Commission in this Order and claim RoE strictly in accordance with the
same and not cling to its own set of figures without assigning any reasons for the difference in
the two set of figures submitted before the Commission.
In compliance with the above directions, the Petitioner submitted that, as per our
calculations less amount of Equity was recognized by the Commission. The Petitioner further
submitted that the Commission for computation of equity invested in creation of capital assets, first
considered the amount of loan and grants and thereafter 30% of the balance considered as equity.
The Petitioner submitted that the approach adopted is not correct. The Petitioner submitted that
30% equity is invested in the assets financed through REC Loan/ District and State Plan Loans.
UPCL submitted that it has mentioned the same in the petition filed before the Commission
to review various issues of the Tariff Order including computation of equity and return on the
same. The Commission vide its review order dated 03.08.2017 directed UPCL to raise this issue in
the ARR & Tariff Petition for FY 2018-19. Accordingly, this issue has been raised in this petition
giving details of the case with justification.
The Commission has taken note of the Compliance as regards RoE.
7.1.9 Employee Expenses
The Commission directed the Petitioner to expedite the recruitment process and also submit
a quarterly status report to the Commission detailing the steps taken by it in this regard and also the
status of the recruitments planned.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted the status of direct
recruitment. The Petitioner also submitted that Adhiyachan for the 225 posts. The Commission in its
APR Order dated March 29, 2017 directed the Petitioner to submit a plan of action regarding the
recruitment process within one month of the issue of Tariff Order.
In compliance with the above directions, the Petitioner submitted the status of direct
recruitment as shown in the Table given below:
Table 7.3: Recruitment Status as submitted by the Petitioner

No. of
Group Post Current Status Remark
Vacancies
• Result & other action withheld vide Govt Letter No.
B Accounts Officer 11 574/I(2)/2016-06(2)14/2016 dated 26-04-2016.
• According to the instructions given by the Government
through Letter No.1155/I(2) /2016/06(2)-14/2016 dated
07-12-2016, the selection procedure has started and is
under process.
B Law Officer 2 ●Advertisement has
• Through Corporation letter no.3966/ Dir (HR) /UPCL/
been released on 16-01-
Camp dated 18-04-2017 a letter has been sent to Govt. to
2016.
seek further directions regarding the declaration of the
result of written examination and starting with the
●Written Exam for these
interview procedure. Reply is being awaited.
posts held on 24.4.2016.
Assistant Engineer • Presently, through Corporation letter no.6305/ Dir (HR)
B 47 /UPCL/ KF-22 dated 05-06-2017 & letter no.10402/ Dir
(E&M)
(HR) /UPCL/ KF-22 dated 06-09-2017 reminders have
been sent to Govt. to seek further directions regarding the
Assistant Engineer declaration of the result of written examination and
B 7 starting with the interview procedure.
(Civil)
Total 67

The Petitioner also submitted that the following posts has been sent/under process to
Uttarakhand Pravidhik Shikha Parishad:-
Table 7.4: Posts Under-Process as submitted by the Petitioner

No. of Current Status
Group Post Remark
Vacancies
• List of 67 selected candidates has
been provided to UPCL by
Uttarakhand Pravidhik Shiksha
Parishad.
• As per direction of Hon'ble High
Court, Nainital dated 17.11.2015 in
SPA No. 524 of 2015,
"…the corporation will not fill up the
posts, through this selection process,
which are occupied by the persons who
Advertisement was released have been appointed on contract basis
on 9-2-2014. through UPNL.......".
• Presently, the matter is pending
C Office Assistant-III 77 before Hon'ble Industrial Tribunal,
Written exam held on
20-09-2015 by Uttarakhand Haldwani. Final Argument of
Pravidhik Shiksha Parishad. UPCL completed, Judgement
awaited.
• A new writ petition is also filed
by some of the selected candidates
in Hon'ble High Court, Nainital
[WP(M/S) No.12 of 2017, Km.Tanu
& others V/s Uttarakhand Power
Corporation Ltd. & others], which
is also pending before Hon'ble
High Court, Nainital. On
01.08.2017 Hon'ble High Court
ordered to list the matter after 3
weeks.
• Information has been provided
to the Govt.of UK through
Corporation letter no.4016-Dir
Advertisement has been (HR)/ UPCL-22 dated 19.4.2017
released on 8.12.2013 by regarding the present situation of
Uttarakhand Pravidhik the aforesaid posts.
Shiksha Parishad.
C Technician Grade-2 496
• The recruitment for the post of
Recruitment process withheld TG-2 has been stopped by Govt.
as per directions of GoU till vide letter No. 31/2014 dated
further orders. 26.08.2014.
● Presently, the matter is pending

before Hon'ble Industrial Tribunal,
Haldwani.
Total 573

The Petitioner also submitted that Adhiyachan for the following posts has been sent/under
process to Uttarakhand Adhinastha Sewa Chayan Ayog:-
Table 7.5: Posts Under-Process as submitted by the Petitioner

No. of Current Status
Group Post Remark
Vacancies
Advertisement has been
released on 26-09-2016 by
Uttarakhand Adhinastha Sewa
Chayan Ayog.
● Earlier, the tentative date for

C Junior Engineer (E&M) 160
the written exam for the post
According to additional staff
of Junior Engineer (Trainee)-
structure vide G.O.
(E&M) and (Civil) was 29-10-
No.801/I(2)/2016-06(2)-08/2002
2017.
dated 23.06.2016 Revised Adhiyachan
Presently, it is scheduled to be
for 160 posts of JE-E&M and 06 post
held on 05-11-2017.
of JE-Civil has been sent to
As per the direction given by
Adhinastha Sewa Chayan Ayog vide
the Chairman, UERC on dated
letter No. 11184 dated 09.08.2016.
10-01-2017, corporation letter
No.397-Dir (HR)/UPCL date
C Junior Engineer (Civil) 6 11-01-2017 was sent to
Uttarakhand Adhinastha Sewa
Chayan Ayog to speed up the
recruitment process of these
225 posts.
Corporation letter no. 4358-
Dir(HR)/ UPCL/KF-2 dated
27-4-2017, letter no. 6306 According to additional staff
Dir(HR)/ UPCL/KF-2 dated structure vide G.O.
05-06-2017 & letter no. 9650 No.801/I(2)/2016-06(2)-08/2002
Dir(HR)/ UPCL/KF-2 dated dated 23.06.2016 Adhiyachan for 40
C Assistant Accountant 40
22-08-2017 has also been sent posts of Assistant Accountant has
to Uttarakhand Adhinastha been sent to Adhinastha Sewa
Sewa Chayan Ayog to Chayan Ayog vide letter No. 11182
expedite the recruitment dated 09-08-2016.
process of the aforesaid posts.
Date for the written

examination for the post of
Assistant Accountant not yet
fixed by Uttarakhand Adhiyachan for 19 posts of
Adhinasth Seva Chayan Draughtsman has been sent to
C Draughtsman 19
Ayog. Adhinastha Sewa Chayan Ayog vide
letter No. 11183 dated 09-08-2016.
Written exam for the post of
Draughtsman held on
25.06.2017.
Total 225
The Commission has taken note of the compliance on recruitment of employees.

7.1.10 Bad &Doubtful Debts
The Petitioner was directed to finalize the Policy within three month of the date of Order
and submit the same for approval of the Commission. UPCL was directed to submit the basis of
arriving at the ageing of debtors within one month of the date of Order.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that the policy has
been prepared and was put up to the Audit Committee in the meeting held on June 24, 2016. Audit
Committee directed to get the same examined and verified through a firm of Professional Chartered
Accountants.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to submit the
bad debt policy within three months from the date of this Order.
In compliance with the above directions, the Petitioner submitted that, UPCL has identified
1,81,026 electricity connections lying disconnected and being shown in the data base as Not
billed/Stop billed. The arrear against these connections is Rs. 570.25 Crore in the record. UPCL has
prepared an action plan to settle these cases in FY 2017-18 by Writing Off fictitious arrears and
irrecoverable arrears and to collect the recoverable amount. The Petitioner submitted that the field
officers have been directed to take action as per this action plan circulated vide letter no.
1843/UPCL/RM/N-20, dated 02.05.2017. The Petitioner further submitted the draft bad debt
policy.
The Commission has taken note of the Petitioner submission. Though the Petitioner has
submitted a draft bad debt policy however, the same needs to be supported by audit report of
receivables. The Commission, therefore, directs the Petitioner to submit the audit report of
receivables identifying and classifying the same in detail within 6 months from the date of this
Order. The Commission shall consider writing off of bad debts for FY 2018-19 upon submission
of the same at the time of truing up of FY 2018-19.

7.1.11 Reliability Indices
The Commission directed the Petitioner to submit monthly report on Reliability Indices in
the format prescribed by the Commission vide letter no. 1200/UERC/Tech/9/2010 dated
September 28, 2010. These reports should also be submitted in MS-Excel soft form.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that the monthly
report of reliability indices for the month of April, 2016 has been submitted to the Commission vide
UPCL’s letter no. 1830/ UPCL/ RM/ SM, dated 04.06.2016.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to submit
the monthly report on Reliability Indices on regular basis.
In compliance with the above directions, the Petitioner submitted that steps have been taken
at Corporate Office to ensure that the said report is timely submitted to the Commission on regular
basis. The report for the month of August, 2017 has been submitted to the Commission vide UPCL’s
letter no. 4054/UPCL/RM/SM, dated 03.10.2017. The details of SAIFI, SAIDI & MAIFI for the
month of August, 2017 as submitted are as follows:-
Table 7.6: Details of SAIFI, SAIDI & MAIFI for the month of
August, 2017
Particulars Urban Feeder Rural Feeder
SAIFI 33 no. 40 no.
SAIDI 864 minutes 1264 minutes
MAIFI 13 no. 11 no.
The Commission has noted the Petitioner’s reply on Reliability Indices. The Commission
once again directs the Petitioner to submit the monthly report on Reliability Indices on regular
basis.
7.1.12 Voltage wise Cost of Supply
The Commission directed the Petitioner to submit the action plan along with the timelines
by which the Petitioner will be completing the work as per the action plan, within one month of
issue of the Order.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that it has
identified all the points where metering is required at 33 kV voltage level and a detailed plan was
submitted to the Commission vide UPCL’s letter no. 2941/D(O)/UPCL/C-4, dated November 1,
2015. As per this plan, the work of 33 kV Metering was targeted to be completed by August 31,
2016.
The status of metering was reported to the Commission vide UPCL’s letter no.
3293/D(O)/UPCL/C-4, dated November 2, 2016 with the request to grant time upto December 31,
2016 for completion of the work. The Petitioner also submitted that Meters on DT’s under 31 Towns
of R-APDRP project area have already been installed. 952 nos of meters are proposed to be installed
at DT’s under IPDS scheme in Towns other than R-APDRP Towns.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to expedite
the activities in this regard and submit quarterly report on the status of metering alongwith an
Action Plan to conduct Energy Audit & also related costs to determine the Voltage-wise Cost of
Supply.
In compliance with the above directions, the Petitioner submitted that Metering at 33 KV
voltage level has been completed in all divisions except Srinagar, Kotdwar, Rudraprayag,
Gopeshwar and Narayanbagar divisions. The division-wise progress is as follows (As on 31-10-
2017):
Table 7.7: Division-wise Progress of Metering at 33 kV

S.No. Name of Division Target Progress
1. Srinagar 5 2
2. Kotdwar 16 7
3. Rudraprayag 6 4
4. Narayanbagar 8 4
5. Gopeshwar 6 4
Total 41 21
The Petitioner also submitted that Meters on DT’s under 31 Towns of R-APDRP project
area have already been installed. 952 nos of meters are proposed to be installed at DT’s under IPDS
scheme in Towns other than R-APDRP Towns for which BoQ have been finalized, GTP approval
and material mobilization is under progress.
The Petitioner further submitted that the work of Preparation of Fixed Assets Register for FY
2013-14 to 2015-16 has been awarded to M/s RSA&Co., Chartered Accountants on 30-06-2017 who
have started the work and the work will be completed by 31.12.2018.
The Commission has taken note of the submissions of the Petitioner on Voltage wise cost of
supply. The Commission once again directs the Petitions to expedite the activities in this regard
and submit quarterly report on the status of metering alongwith an Action Plan to conduct
Energy Audit & also related costs to determine the Voltage-wise Cost of Supply by the end of FY
2018-19.
7.1.13 Demand Side Management Measures
The Commission directed the Petitioner to submit the report on various Demand Side
Management measures at regular quarterly intervals to the Commission.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that GoU on
October 30, 2015 approved a scheme for distribution of LED Bulbs in Uttarakhand. Under the
scheme all domestic consumers and Non-domestic consumers (up to 10 kW) would be provided
three LED Bulbs at a price of Rs. 105 per bulb (now Rs. 95 per bulb). There was a target of 55.65 lacs
LED distribution under the scheme. 33.77 lacs LED bulbs have been distributed so far. 75% cost of
the LED bulbs in respect of BPL Consumers & 25% cost in respect of Domestic Consumers having
monthly consumption of 100 units is being borne by GoU.
report on various Demand Side Management measures at regular quarterly intervals to the
Commission.
In compliance with the above direction, the Petitioner submitted that upto March, 2017 a
total of 38.845 lacs LED bulbs have been distribution in the State. Out of which 2.02 lacs 7W LED
bulbs to BPL consumers & 1.98 lacs 7W LED bulbs to other domestic consumers, having
consumption upto 100 units have been distributed on subsidized rates. Further, distribution of 9W
LED bulbs, 20W LED Tube Light & 50W Energy Efficient Ceiling Fans has also been initiated in the
State with effect from 10th April, 2017 onwards. The status of distribution is as follows:

Table 7.8: Status of Distribution of Energy Efficient Equipments

Month 9W 20W EE 50W 5 Star
LED Bulbs Tube Lights Rated Fans
April, 17 20376 323 23
May, 17 73771 899 376
June, 17 89892 1865 688
July, 17 51633 1999 141
August, 17 93605 3914 711
September, 17 95476 4885 595
Total 424753 13885 2534
The Commission has taken note of the submissions of the Petitioner. The Commission,
hereby, re-directs the Petitioner to submit the report on various Demand Side Management
measures at regular quarterly intervals to the Commission.
7.1.14 Issues raised by the Petitioner again despite Commission’s ruling in previous Tariff
Orders
The Commission directed the Petitioner to not raise such issues again in the subsequent
ARR and Tariff Petitions on which the Commission have already taken the decision and given its
ruling in the previous Tariff Orders, failing which, the Commission may reject the Petition upfront.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that this ARR and
Tariff filing is being done keeping in view the direction issued by the Commission and provisions of
Law in the matter.
The Commission in its APR Order dated March 29, 2017 redirected the Petitioner to not raise
such issues again in the subsequent ARR and Tariff Petitions on which the Commission have
already taken the decision and given its ruling in the previous Tariff Orders, failing which, the
Commission may reject the Petition upfront.
The Petitioner submitted that this ARR and Tariff filing is being done keeping in view the
direction issued by the Commission and provisions of Law in the matter.
The Commission has noted the Petitioner’s reply in this regard.

7.1.15 Metering of unmetered connections
The Commission in its APR Order dated March 29, 2017 directed that from December 2016
onwards any un-metered consumer, if found, in any of the Petitioner’s record or billing ledger shall
be treated as mis-declaration/wrong reporting by the Petitioner in its monthly Commercial
Performance Monitoring reports and appropriate action under Act/Regulations may be initiated
against the concerned officers of the Petitioner including Executive Engineer (Distribution) of the
concerned Division.
The Petitioner submitted that as per information received from the field officers, there is no
unmetered connection in Domestic and PTW Categories.
The Commission has taken note of the Petitioner’s submission.
7.1.16 Interest on GPF Trust
The Commission directed the Petitioner to expedite the Audit of Accounts of the trust to
ensure that audit is completed by June 30, 2016 and to submit the audit report to the Commission by
July 31, 2016.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that UPCL vide its
letter no. 1854/UPCL/RM/C-11, dated May 1, 2015 submitted the copies of Audited Accounts of
UPCL Employees GPF Trust for the period from FY 2002-03 to FY 2009-10.
The Petitioner further submitted that the work of preparation of Accounts and Audit of the
same for the remaining period is under progress and shall be provided to the Commission by
December 31, 2016.
audit report to the Commission within one month from the date of issue of the Order.
In compliance with the above direction, the Petitioner submitted that UPCL vide its letter
no. 1854/UPCL/RM/C-11, dated May 1, 2015 submitted the copies of Audited Accounts of UPCL
Employees GPF Trust for the period from FY 2002-03 to FY 2009-10. Further, UPCL vide its letter
no. 2081/UPCL/RM/C-13, dated 20.05.2017 submitted the copies of Audited Accounts of UPCL
Employees GPF Trust for the period from FY 2010-11 to FY 2012-13. Also UPCL vide its letter no.
4713/UPCL/RM/C-13, dated 21.11.2017 submitted the copies of Audited Accounts of UPCL
Employees GPF Trust for the period from FY 2013-14 to FY 2015-16.
The Commission has taken note of the compliance made by the Petitioner.
7.1.17 Power Purchase Expenses (Including Transmission Charges)
The Petitioner was directed to separately claim the cost of the energy returned under
banking during truing up exercise of FY 2015-16 and not show the same as adjustment from the
provisions.
The Commission directed the Petitioner to put in place a mechanism for recording the
arrears paid in a year for submission along with its claim of truing up for the respective year in the
absence of which the Commission shall take an appropriate view regarding the allowable power
purchase cost while carrying out the truing up exercise.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that as directed by
the Commission, the cost of inward banking energy in FY 2014-15 shall be claimed in FY 2015-16
(during truing-up exercise), i.e. the year in which the energy has been returned.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to include
the provisioning amount of Rs. 50.88 Crore towards banked power in the Petition for truing up of
FY 2016-17. (Ref Para 3.1.3)
The petitioner submitted that the cost of net inward banking amounting to Rs. 50.88 Crore in
FY 2015-16 was reflecting in the Audited Accounts for the said year. However, UPCL did not claim
the same in the True-up as per the direction earlier issued by the Commission. The cost needs to be
allowed in the year in which the banked energy is returned but the Commission wrongly deducted
Rs. 50.88 Cr. from the claim of UPCL of power purchase. The Petitioner further submitted that it
had filed a petition before the Commission to review various issues of the Tariff Order including
this issue. The Commission vide its review order dated 03.08.2017 had allowed this cost to UPCL.
The Commission has taken note on the Petitioner’s Submission on Power Purchase
expenses.

7.1.18 Deficit/Surplus Power
The Commission directed the Petitioner to put its sincere efforts to procure the deficit energy
through a mix of long term arrangements, medium term arrangements and short term purchases
optimizing the cost of power purchase and reliable power. Further, the procurement should be
through transparent process of bidding and not on mutual agreements as has been the practice of
UPCL. UPCL was directed to submit a comprehensive plan as to how it intends to meet the deficit
within one month of the date of Order.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that the desired
revised plan has been submitted to the Commission vide UPCL’s letter no. 3012/UPCL/Com, dated
September 1, 2016.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to bank the
surplus energy during the month of April 2017 to September 2017 and withdraw the same in the
month of October 2017 to March 2017 and the Petitioner should put in sincere efforts to suffice its
requirement of power during deficit period/lean hydro generation period from the surplus energy
available during the high hydro generation period through appropriate banking
arrangements/agreements.
The Petitioner submitted that as per direction of the Commission, the banking of surplus
energy has been agreed with Punjab State Power Corporation Limited as per details given below:-
Table 7.9: Details of Banking Arrangement done in FY 2017-18

Quantum of
Name of Quantum of power
power Energy Return Energy
Month the to be taken back by
to be supplied (MU) period (MU)
Bidder UPCL(MW)
by UPCL (MW)
Jun-17 100 72 Dec-17 230 171
Jul-17 350 260.4 Jan-18 390 290
PSPCL
Aug-17 350 260.4 Feb-18 250 168
Sep-17 150 108 Mar-18 200 149
Total energy (MW/
950 700.80 1070 778
MU)

The Petitioner further submitted that the above arrangement of banking of power has been
approved by the Commission vide its order dated 20-06-2017. The details of banking from April,
2017 to October, 2017 are as follows:-
Table 7.10: Details of Advance Banking

Quantum Energy
Month No of days Remarks
(MW) (MU)
Apr & May-17 - - 43.778 "As & when" basis
Jun-17 100 30 96.117 Firm & "As and When" basis
Jul-17 350 31 270.667 Firm & "As and When" basis
Aug-17 350 31 209.604 Firm Basis
Sep-17 150 30 111.600 Firm & "As and When" basis
Oct-17 0 1 0.275 “As and When" basis “
Total 950 123 732.041 -
The Commission has taken note of the Petitioner’s submission. The Commission directs the
Petitioner to bank the surplus energy during the month of May 2018 to September 2018 and
withdraw the same in the month of October 2018 to March 2019.
7.1.19 Status of NA/NR, IDF/ADF/RDF
The Commission directed the Petitioner to reduce the percentage of NA/NR cases to below
2% in both Hill & Plain area of the State latest by 31.12.2016.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that for the
improvement in the financial and operational efficiency of the Company, UPCL prepared an
efficiency plan and circulated the same to the Field Officers vide letter no. 1629/UPCL/RM/N-38,
dated March 23, 2016. In this efficiency plan, the NA/NR cases have been targeted to be below 2%
in both Hill & Plain areas by December 31, 2016. A copy of the plan was submitted to the
Commission vide UPCL’s letter no. 2481/UPCL/RM/C-12, dated July 13, 2016.
As on December 31, 2016, the NA/NR Cases were 5.87%.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to reduce the
percentage NA/NR cases to below 2% in the entire State latest by 30.09.2017, failing which the
concerned Chief Engineer (Distribution), Superintending Engineer (Distribution), Executive
Engineer (Distribution) & Executive Engineer (Test) shall be held responsible for non-compliance of
the Commission’s directions and appropriate action under the Act/Rules/Regulations may be
initiated.

In compliance with the above direction, the Petitioner submitted that UPCL vide its letter
dated 19.04.2017 directed all the field officers to reduce the percentage of NA/NR Cases to below
2% latest by 30.09.2017. During the review meeting held on 01-07-2017 under the Chairmanship of
Managing Director, the field officers were directed to achieve the level of NA/NR Cases to below
2% latest by 30.09.2017. The Petitioner further submitted that as on 31.07.2017 the NA & NR Cases
were 3.29% and 2.46% respectively.
The Commission directs the Petitioner to reduce the percentage NA/NR cases to below 2%
in the entire State latest by 30.09.2018, failing which the concerned Chief Engineer (Distribution),
Superintending Engineer (Distribution), Executive Engineer (Distribution) & Executive Engineer
(Test) shall be held responsible for non-compliance of the Commission’s directions and
appropriate action under the Act/Rules/Regulations would be initiated.
7.1.20 Replacement of Improper, Non-Functional, Stop/Stuck up defective or IDF Meters
The Petitioner was directed to restrict percentage of defective meters (IDF) to 3% in plain
areas upto 31.09.2016 and upto 30.12.2016 in hill areas of the State, failing which appropriate action
under the Act/Rules/Regulations would be taken against the Petitioner for the continued non-
compliance of the directions of the Commission.
dated March 23, 2016. In this efficiency plan, the IDF cases have been targeted to be brought at the
level of 3% in plain areas up to 30.09.2016 and up to 30.12.2016 in Hill areas of the State. The
Petitioner further submitted that as on December 31, 2016, the IDF Cases were 5.27%.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to restrict the
percentage of defective meters (IDF) to 3% in plain as well as in hilly areas of the State upto
30.09.2017, failing which the concerned Chief Engineer (Distribution), Superintending Engineer
(Distribution), Executive Engineer (Distribution) & Executive Engineer (Test) shall be held
Act/Rules/Regulations may be initiated.

As regards the replacement of defective meters, the Petitioner has submitted that the
Officers of the Company at various levels are doing efforts but the desired results could not be
achieved mainly due to shortage of manpower. Therefore, a tender for replacement of defective
meters was floated in July, 2017 which is under finalization. The target to maintain the level of
defective meters below 3% in all the areas (Urban and Rural) will be achieved by the end of
September, 2018. The defective meters as on 31.07.2017 are 4.38%.
The Petitioner is once again directed to restrict the percentage defective meters (IDF) to
3% in plain as well as in hilly areas of the State upto 30.09.2018, failing which the concerned
Chief Engineer (Distribution), Superintending Engineer (Distribution), Executive Engineer
(Distribution) & Executive Engineer (Test) shall be held responsible for non-compliance of the
Commission’s directions and appropriate action under the Act/Rules/Regulations would be
initiated.
7.1.21 Replacement of Mechanical Meters
The Commission directed the Petitioner to replace all the existing mechanical meters by
static/electronic meters by December 31, 2016 & consolidate its complete database for mechanical
meters including areas not covered under R-APDRP/IPDS Schemes.
dated March 23, 2016. In this efficiency plan, the mechanical meters have been targeted to be
replaced with the electronic meters by December 31, 2016. The mechanical meters as on 31-03-2016
and 31-08-2016 were respectively 1,27,074 and 1,24,459.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to
consolidate its complete database for mechanical meters including areas not covered under R-
APDRP/IPDS Schemes. Further, the Commission directs the Petitioner to prepare a division-wise
firm plan for replacement of all the existing mechanical meters by electronic/static meters within
next 2 years and submit the same along-with the prescribed Format-3 of Commercial Performance

Monitoring report for the month of April 2017 and ensure that 50% of the existing mechanical
meters are replaced by electronic/static meters latest by 31.03.2018.
In compliance with the above direction, the Petitioner submitted that the Officers of the
Company at various levels are doing efforts but the desired results could not be achieved mainly
due to shortage of manpower. Therefore, a tender for replacement of mechanical meters and
defective meters was floated in July, 2017 which is under finalization. All the mechanical meters
shall be replaced by the end of September, 2018. The Petitioner further submitted that 1,13,499
mechanical meters was in March, 2017 which has been reduced to 88,545 in July, 2017.
The Commission directs the Petitioner to ensure complete replacement of Mechanical

Meters by Electronic Meters well before 31.03.2019.
7.1.22 Ghost/Fictitious Consumers
The Commission directed the Petitioner to write off ghost/fictitious/non-existent consumers

from its billing database under a transparent policy framed by the Petitioner latest by September 30,
2015.
The Petitioner in the proceedings of APR Order for FY 2016-17 submitted that the number of
ghost consumers as on March 31, 2016 and August 31, 2016 are 710 and 682 respectively.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to write off
ghost/fictitious/non-existent consumers from its billing database under a transparent policy
framed by the Petitioner latest by 31.05.2017, failing which appropriate action under the
Act/Regulations may be initiated against the concerned officers of the Petitioner including
In compliance with the above direction, the Petitioner submitted that UPCL has identified
billed/Stop billed. The arrear against these connections is Rs. 570.25 Crore in the record. UPCL has
prepared an action plan to settle these cases in FY 2017-18 by Writing off fictitious arrears and
irrecoverable arrears and to collect the recoverable amount. Field officers have been directed to take

action as per this action plan circulated vide letter no. 1843/UPCL/RM/N-20, dated 02.05.2017. The
Petitioner further submitted that Ghost /Fictitious Consumers are included in the NB/SB
Consumers.
The Petitioner is directed to ensure that no new ghost/fictitious/non-existent consumers

should appear in its billing database.
7.1.23 NB & SB Cases
The Commission directed the Petitioner to liquidate and finalize NB/SB cases and set a
target of realization from at least 25% of these cases within 6 months from the date of issuance of the
Order.
The Petitioner in the proceedings for APR Order of FY 2016-17 has submitted that the
number of NB & SB cases as on August 31, 2016 is 1,55,841.
The Commission in its APR Order dated March 29, 2017 directed the Petitioner gave last
opportunity to the Petitioner for liquidating and finalising at least 25% of the NB/SB cases latest by
30.09.2017, failing which appropriate action under the Act/Rules/Regulations would be initiated
against the Petitioner for the continued non-compliance of the directions of the Commission.
In compliance with the above direction, the Petitioner submitted that UPCL has identified
billed/Stop billed. The arrear against these connections is Rs. 570.25 Crore in the record. The
Petitioner has further prepared an action plan to settle these cases in FY 2017-18 by Writing Off
fictitious arrears and irrecoverable arrears and to collect the recoverable amount. Field officers have
been directed to take action as per this action plan circulated vide letter no. 1843/UPCL/RM/N-20,
dated 02.05.2017.
The Commission has taken a serious note of the continued non-compliance by the
Petitioner with regard to NB/SB cases the Commission directs the Petitioner to liquidate and
finalise atleast 5% of the NB/SB cases in each quarter and submit quarterly report before the
Commission. In absence of the same, action under the provisions of Act/Rules/Regulations may
be initiated against the Petitioner.

7.1.24 Outstanding Arrears
The Commission directed the Petitioner to make sincere efforts in mobilizing its resources to
continuously make efforts throughout the year for collection of arrears under a structured
receivable management programme besides taking corrective actions against the habitual
defaulters. The Commission also directed the Petitioner to lay down standard procedure for
receivables management and submit the same to the Commission within one month of issuance of
this Order.
The Petitioner in the proceedings for APR Order of FY 2016-17 has submitted that a
receivable management program has been prepared for collection of arrears. This program is
circulated to the Field Officers vide UPCL’s letter dated July 8, 2016. A copy of this letter has been
submitted to the Commission vide letter no. 2481/UPCL/RM/C-12, dated July 13, 2016.
The Petitioner also submitted that recovery of arrears from Government categories
amounting to Rs. 120.85 Crore has also been done during FY 2016-17 (up to October).
The Commission in its APR Order dated March 29, 2017 directed the Petitioner to make
sincere efforts in mobilizing its resources throughout the year for collection of arrears under a
structured receivable management programme besides taking corrective actions against the
habitual defaulters.
The Petitioner in compliance to the above submitted that UPCL vide its letter no.
1597/UPCL/RM/L-17, dated 17-04-2017 and no. 1654/UPCL/RM/L-17, darted 19.04.2017 fixed the
division wise Annual and Daily Revenue Collection Targets. These targets have been issued to
achieve 14.75% AT&C Losses as approved by the Commission in its Tariff Order dated 29.03.2017.
This will improve the collection period of UPCL. On issuance of order dated 03.08.2017 on the
review petition of UPCL, UPCL revised its targets vide letter no. 3354/UPCL/RM/L-17, dated
17.08.2017. The Petitioner further submitted that with a view to recover Arrears and Writing Off of
fictitious and irrecoverable arrears, UPCL has identified 1,81,026 electricity connections lying
disconnected and being shown in the data base as Not billed/Stop billed. The arrear against these
connections is Rs. 570.25 Cr. in the record. UPCL has prepared an action plan to settle these cases in
FY 2017-18 by Writing Off fictitious arrears and irrecoverable arrears and to collected the

recoverable amount. Field officers have been directed to take action as per this action plan
circulated vide letter no. 1843/UPCL/RM/N-20, dated 02-05-2017. This will improve the collection
period.
The Commission hereby directs the Petitioner to make sincere efforts in mobilizing its
resources throughout the year for collection of Arrears under a structured receivable
management programme besides taking corrective actions against the habitual defaulters.
7.1.25 Status of KCC Consumers
The Commission directed the Petitioner that the KCC consumers having less load factor
should be closely monitored and average consumption pattern and abnormality in consumption
pattern should be checked and duly analysed. The Commission also directed the Petitioner to check
KCC consumers who are repeatedly exceeding their sanctioned/contracted demand and take
corrective action in such cases.
The Petitioner in the proceedings for APR Order of FY 2016-17 has submitted that
monitoring of KCC consumer is being done on regular basis.
The Commission again directed the Petitioner that KCC consumers having less load factor
pattern should be checked and duly analysed. The Commission also directs the Petitioner to check
KCC consumers who are repeatedly exceeding their sanctioned/contracted demand and take
corrective action in such cases.
The Petitioner submitted that the monitoring is being done on regular basis.
The Commission directs the Petitioner that KCC consumers having less load factor
pattern should be checked and duly analysed. The Commission also directs the Petitioner to
check KCC consumers who are repeatedly exceeding their sanctioned/contracted demand and
take corrective action in such cases.

7.1.26 Status of Revenue realisation per unit sold
The Commission directed the Petitioner to take immediate steps to frame a time bound
programme for realisation of pending arrears/dues and submit a report on the action taken for
realisation of arrears, amount of arrears, arrears remaining outstanding and reasons for non-
realisation of these arrears/dues should be submitted to the Commission within three months of the
issuance of the Order.
The Petitioner in the proceedings for APR Order of FY 2016-17 submitted that Division wise
targets have been fixed for recovery of revenue arrears from Non- Government Categories for FY
2016-17 amounting to Rs. 161 Crore. Further, outstanding arrear against Government categories
amounting to Rs. 325 Crore. approx. has also been targeted to be recovered during FY 2016-17.
The Commission directed the Petitioner to ensure that the data furnished in Commercial
Performance Monitoring report should match with its Commercial Diary, i.e. CS-4 data and the
Petitioner should ensure that in all future submissions of Commercial Performance Monitoring
reports the Average Realisation Rate should be calculated on the basis of recoveries on account of
Realisation Against energy dues only and the realisation shown should exclude recoveries from
duties/cess, etc. Further, the realisation against energy dues should clearly bifurcate realisation
against current dues & realisation against past dues.
The Petitioner submitted that it is being done as per the directions of the Commission.
The Commission again directs the Petitioner to ensure that the data furnished in
Commercial Performance Monitoring report should match with its Commercial Diary, i.e. CS-4
data and the Petitioner should ensure that in all future submissions of Commercial Performance
Monitoring reports the Average Realisation Rate should be calculated on the basis of recoveries
on account of Realisation Against energy dues only and the realisation shown should exclude
recoveries from duties/cess, etc. Further, the realisation against energy dues should clearly
bifurcate realisation against current dues & realisation against past dues, failing which
appropriate action shall be initiated against the Petitioner/Licensee.

7.1.27 Billing and Collection System
The Commission directed the Petitioner to comply with the directions issued in the
Commission’s Order dated 07.01.2016 in the matter of Bill Collection System, failing which
appropriate action under the Act/Rules/Regulations would be taken against the Petitioner for the
continued non-compliance of the directions of the Commission. The Commission further directed
the Petitioner to expedite integrating CSCs available in the State with its billing system under the
agreement executed between UPCL & Common Service Centre E-Governance Services India Ltd.,
New Delhi.
The Petitioner in the proceedings for APR Order of FY 2016-17 submitted that the
integration of UPCL’s bill payment collection system was done with the Common Service Centre
also known as Dev Bhhomi Jan Suvidha Kendra in the month of May, 2015 & the application is
running successfully thereafter.
The Commission directed the Petitioner to continue paying daily penalty of Rs. 2500/-
which shall be paid within 30 days of the close of each calendar month till such time each of the
directions as given in the Order dated 09.07.2004 & 01.09.2005 of the Commission has been fully
complied.
The Petitioner submitted that the penalty for the period upto August, 2017 has been
deposited to the Commission vide UPCL’s letter no. 3533/UPCL/Com/RMC-9/CE, dated 28-08-
2017. The amount of penalty paid by 31-08-2017 is Rs. 1.108 Cr. Further, on the request of UPCL,
Commission vide its letter no. UERC/5/Tech/441/2017-18/1039, dated 18-09-2017 withheld the
penalty for next sixth months subject to completion of bill collection facilities and integration of all
the functional Common Service Centre in the State by the said period.
In this connection, it is also submitted that tender for developing facilities at the collection
centers as per the direction of Commission has been invited as per details given herein below:

Table 7.11: Status of Creation of facilities at the collection centers

S. Name of Awarded Cost of Targeted date of
Name of L-1 bidder LOA Date
No. Zone work (Rs.) Completion
M/s Royal Infra Power
Haridwar
1. Corp., Muzafarnagar 1,64,84,138,.28 20-9-2017
Zone
(UP) 6 month from the
U.S. date of LOA
M/s National
2. Nagar 1,10,22,240.01 20-09-2017
Construction Rudrapur
Zone
Kumaon M/s National
3. 3,82,73,024.73 07-10-2017
Zone Construction Rudrapur
Part –I of the tender has been opened on 3-11-2017. The tender is expected to be
Garhwal
4. finalized upto 15-12-2017. The completion period of this tender shall also be 6
Zone
month from the date of LOA.
The Petitioner subsequently submitted that the tender for Garwhal Zone has also been
awarded in the month of December 2017.
The Commission hereby directs the Petitioner to complete the works of bill collection
facilities and integration of all CSCs in the State latest by 30.04.2018, in absence of which, stern
action under the provisions of the Act/Rules/Regulations would be initiated against it. Moreover,
the Commission directs the Petitioner to make widespread publicity/ Advertisement/workshop
of the bill collection facilities & list of VLEs operating in the vicinity of various electricity Sub-
division/division officers of UPCL across the State.
7.1.28 Energy Audit
The Commission directed the Petitioner to provide meters at each feeder, ‘T’ points, DTs &
consumers in the distribution network so that effective energy auditing can be done & proper
energy accounting can throw-up several actionable issues which, when addressed, will result in
marked improvement in distribution loss.
The Petitioner in the proceedings for APR Order of FY 2016-17 submitted that UPCL has
identified all the points where metering is required at 33 kV voltage level and a detailed plan was
submitted to the Commission and as per this plan, the work of 33 kV metering was targeted to be
completed by 31.08.2016 and requested to grant time upto 31.12.2016 for completion of the work.
The Commission directed the Petitioner to provide/maintain the metering system at each
feeder, ‘T’ points, DTs and consumers in its distribution network for effective energy auditing and

accounting. The Petitioner is directed to submit compliance report in this regard by 30.09.2017,
failing which appropriate action will be taken against the Petitioner in accordance with the
Act/Rules/Regulations.
The Petitioner submitted that the Metering at 33 KV voltage level has been completed in all
divisions except Srinagar, Kotdwar, Rudraprayag, Gopeshwar and Narayanbagar divisions. The
division-wise progress is as follows (As on 31-10-2017)
Table 7.12: Division wise Progress of Energy Auditing

S.No. Name of Division Target Progress
1. Srinagar 5 2
2. Kotdwar 16 7
3. Rudraprayag 6 4
4. Narayanbagar 8 4
5. Gopeshwar 6 4
Total 41 21
The Petitioner further submitted that the Meters on DT’s under 31 Town of R-APDRP
project area have already been installed. 952 nos. of meters are proposed to be installed at existing
DT’s under IPDS scheme in Towns other than R-APDRP Towns for which BoQ have been finalized,
GTP approval and material mobilization is under progress.
The Petitioner is directed to provide/maintain the metering system at each feeder, ‘T’
points, DTs and consumers in its distribution network for effective energy auditing and
accounting. The Petitioner is directed to submit compliance report in this regard by 30.09.2018,
failing which appropriate action may be taken against the Petitioner in accordance with the
Act/Rules/Regulations.
7.1.29 Transfer of Distribution Business from UJVN Ltd. to UPCL (Reference Para 7.2.22 of
Tariff Order dated 10.04.2014)
The Commission directed the Petitioner and UJVN Ltd. to comply with the directions of the
Commission in all respect by 30.05.2016 and submit compliance report in the matter by 15.06.2016,
failing which appropriate action shall be initiated against both the utilities in accordance with the
provisions of the Act/Regulations.
The Petitioner in the proceedings for APR Order of FY 2016-17 submitted that in compliance

of direction issued by the Commission, 129 consumers at Dakpatthar and 13 consumers at Dhakrani
site of UJVN Ltd. have already been taken by UPCL but remaining consumers of Dhalipur & Koti
site could not be taken over by UPCL as UJVN Ltd. have not provided the security deposit,
verification details and application forms of the consumers.
The Commission directed both the utilities i.e. UPCL & UJVN Ltd. to complete the taking
over/handing over of distribution business in all respect by 30.06.2017 and submit the compliance
report in the matter by 15.07.2017, failing which appropriate action shall be initiated against the
concerned Nodal Officers responsible for the same in accordance with the provisions of the
Act/Regulations.
UPCL vide various letters has directed the Nodal officers and concerned divisions to
complete the taking over distribution business from UJVNL. The connections of Dakpather and
Dhakrani which were provided by UJVNL has been taken over by UPCL. Whereas detail of
connections provided by UJVNL pertaining of Koti site was incomplete, so UPCL has requested
UJVNL to provide proper details. In addition to this a 11 KV line which is required to be
constructed for Koti site has been approved and its construction is under progress.
UJVNL has also informed that Connections of Chilla site are also to be handed over to
UPCL, for which survey of lines and verification of connections is under progress.
The Commission directs both the utilities i.e. UPCL & UJVN Ltd. to complete the taking
over/handing over of distribution business in all respect by 30.06.2018 and submit the
compliance report in the matter by 15.07.2017, failing which appropriate action shall be initiated
against the concerned Nodal Officers responsible for the same in accordance with the provisions
of the Act/Regulations.
7.1.30 Departmental Employees
The Commission directed the Petitioner to install meters at all its offices and sub-stations, if
not installed, within one month of the date of the Order and submit report to the Commission by
May 15, 2016.
The Commission directed the Petitioner to carry out 100% metering of its departmental
employees, to take regular meter readings and to maintain separate energy account of all its
employees on a monthly basis. The Commission directs the Petitioner to submit a compliance report
of the same within one month of the issuance of the Order.
The Petitioner in the proceedings for APR Order of FY 2016-17 submitted that the Field
Officers were directed to meter all the connections of UPCL offices, sub-stations and departmental
employees. Further, direction has been issued to concerned officers of UPCL to ledgerise
departmental connections and to maintain separate energy account on monthly basis. 4613 nos. of
departmental connections have already been ledgerised so far. All Executive Engineers have been
directed to complete the ledgerisation of departmental connections.
The Commission has taking a strong view directed UPCL to take immediate action on the
directions of the Commission and report compliance to the Commission within one month of the
date of Order. UPCL was further directed to complete the ledgerisation of all the departmental
employees including retired employees availing the facilities within one month of the date of Order.
Thereafter, UPCL is required to take meter readings of all the departmental employees including
retired employees on monthly basis and issue bills to them. UPCL is required to submit the copies
of the bills issued by the end of each month to the Commission.
The Petitioner submitted that UPCL vide its letter dated 19.04.2017 directed field officers to
meter all the connections of UPCL offices, sub-stations and departmental employees and to
ledgerise all the departmental employees including retired employees. Further, submitted that
UPCL vide its letter no. 2927/UPCL/RM/L-20, dated 26-08-2016 specified the mechanism for
billing of the energy consumed in the colonies of UJVNL & PTCUL and their substations.
The Petitioner also submitted that 5343 connections of departmental employees and
pensioners of UPCL, UJVNL and PTCUL have already been metered an recorded in ledger. Copies
of the bills which has been submitted to the Commission vide UPCL’s letter no.
2618/UPCL/RM/C-13, dated 28.06.2017. Field officers have been directed to meter and record in
ledger all the connections of the departmental employees / pensioners of UPCL, UJVNL & PTCUL.
They have also been directed to take regular meter reading and to do regular billing of these
employees. All the departmental employees of UPCL shall be recorded in ledger by December,
2017. UPCL has requested UJVNL & PTCUL for list of their departmental connections to be
recorded in ledger, but the final list is still awaited. On the basis of discussion held between the
officers of UPCL and PTCUL, the Petitioner submitted that all the departmental employees of
PTCUL shall be recorded in ledger by December, 2017. On the basis of discussion held with the
officers of UJVNL so far, the Petitioner submitted that the exact time frame cannot be given for
recording in ledger their departmental employees. However, the work of recording in ledger all the
departmental employees is in progress.
UPCL is directed to submit the bills of all the departmental employees for FY 2016-17
within 2 months of the date of the Order before the Commission. UPCL is also directed to
reconcile the figures of departmental employees in the commercial data as well as that claimed
for calculation of employee expenses and submit the same to the Commission within 2 months
of the date of the Order.
7.1.31 Location of Installation of Meters
The Commission directed Executive Engineer, EDD Pithoragarh to submit a detailed

compliance report on action taken for shifting of the meters to a safer location in or around the
premises within one month of the date of Order. Further, the Commission directed the Chief
Engineer, Rudrapur Zone, UPCL and Executive Engineer, EDD Pithoragarh, UPCL to take
necessary action and submit the compliance report within one month of the date of the Order.
The Commission further directed the Petitioner to examine this issue in other Divisions also
and, if required, the Field Officers may be directed to take corrective actions.
UPCL vide its letter no. 1858/UPCL/RM/C-13, dated 03.05.2017 directed all the field
officers to ensure that meters of the consumers are installed at safer locations.
The Petitioner is directed to submit quarterly status report with regards to shifting of
meters for all divisions to the Commission.
7.1.32 Transfer of Petitioner’s Personnel
The Commision directed the HR Department, UPCL to identify such employees who have
been posted in the same department for a period more than that stipulated in the aforesaid Policy,
and take necessary action as per the Policy and report compliance within 03 months of the date of
Order.

The Petitioner has submitted that action is being taken as per the direction of Commission
and the compliance report in the matter has also been submitted to the Commission.
The Petitioner is directed to submit the status of number of employees that have been
posted in the same department for a period more than that stipulated in the aforesaid Policy to
the Commission by 30.04.2018.
7.1.33 Water Tax
The Commission directed the Petitioner to submit all the relevant information along with
supporting documents for substantiating the actual expenses incurred on account of Water Tax for
FY 2016-17 along with its proposals for True up for FY 2016-17.
The Petitioner in the proceedings of APR for FY 2016-17 submitted that the desired
information shall be provided to the Commission along with the proposal for true-up for FY 2016-
17.
The Commission directed the Petitioner to submit all the relevant information along with
the supporting documents for substantiating the actual expenses incurred on account of Water Tax
for FY 2016-17 and FY 2017-18 along with its proposals for True up.
The Petitioner submitted the desired details along with the current Petition.
The Petitioner is directed to submit all the relevant information along with the
supporting documents for substantiating the actual expenses incurred on account of Water Tax
for FY 2017-18 and FY 2018-19 along with its proposals for True up.
7.1.34 Open Access Charges
The Petitioner was directed that the wheeling charges and cross subsidy surcharge
recovered from open access customers shall be shown separately under the separate head of income
in its ARR/Tariff filings from next year onwards. Further, the Petitioner was directed that the
amount received from PTCUL, in lieu of transmission charges collected by PTCUL from
long/medium term open access customers be shown separately under non-tariff income in the

ARR/Tariff filings from next year onwards and should not be reduced from the Transmission
charges payable to PTCUL.
The Petitioner in the proceedings of APR of FY 2016-17 submitted that it has created
separate heads in the accounts to separately capture the information of wheeling charge and cross
subsidy surcharge recovered from the Open Access Consumers. The Petitioner further submitted
that the transmission Charges collected by PTCUL from the long term/medium term Open Access
consumers and adjusted in the Transmission Charges payable to PTCUL shall be shown in a
separate head under Non- Tariff Income.
The Commission directed that the wheeling charges and cross subsidy surcharge recovered
from open access customers shall be shown separately under the separate head of income in its
ARR/Tariff filings. Further, the Petitioner was directed that the amount received from PTCUL, in
lieu of transmission charges collected by PTCUL from long/medium term open access customers be
shown separately under non-tariff income in the ARR/Tariff filings and should not be reduced
from the Transmission charges payable to PTCUL.
The Petitioner in compliance to the above submitted that following new heads have been
created in the Accounts to separately capture the information of wheeling charge and cross subsidy
surcharge recovered from the Open Access Consumers:
Table 7.13: Accounting Heads for booking Revenue received under Open
Access
Account Head Description
23.711 Wheeling Charges
23.712 Cross Subsidy Surcharge
61.511 Wheeling Charges (L&H Power above 100 HP)
61.512 Cross Subsidy Surcharge (L&H Power above 100 HP)
The Petitioner further submitted that these charges have been shown separately in the
ARR/Tariff Filing for FY 2018-19 and amount received from PTCUL in lieu of Transmission charges
collected by PTCUL from open Access Consumers has been shown under Non-Tariff Income in FY
2016-17.
The Commission has noted the submissions of the Petitioner.

The Petitioner is once again directed that the wheeling charges and cross subsidy
surcharge recovered from open access customers shall be shown separately under the separate
head of income in its ARR/Tariff filings.
7.1.35 Tariff Hike
UPCL was directed to submit the details of the category-wise energy consumed & amount
thereon of those areas where bills have been waived off & also the details if any subsidy in this
regard has been received from GoU, within one month of the date of the Order.
The Petitioner in compliance submitted that Government of Uttarakhand vide its order no.
1275/I(2)/2013-05-40/2013, dated 04.07.2013 directed to waive off the Domestic Electricity Bills of
the disaster affected area for the period from 01.06.2013 to 31.03.2014. Further, GoU vide its letter
no. 215/I(2)/2014-10/13/2013, dated 20.02.2014, in respect of Hon’ble Chief Minister’s Ghoshna
No. 453/2013 informed that the Electricity Bills of the Consumers residing in Vikaskhand –
Dharchula and Munsiyari of District Pithoragarh shall be waived off from 01.07.2013 to 31.05.2014.
As against the above orders of GoU, UPCL vide its letter dated 20.03.2014 requested GoU to release
Rs. 1104.81 lakh towards the billing amount to be waived off. GoU vide its order no. 1411/XXXI-
14/2013-14, dated 28.03.2014 released Rs. 784.48 lakh, which has been adjusted in the consumer
bills. Balance amount of Rs. 320.33 lakh is awaited from GoU.
Further, GoU vide its letter no. 1022/I(2)/2014-5-40/2013 Vh-lh-] dated 26.05.2014 directed
UPCL to Waive Off the Electricity Bills of the Commercial establishments
(Hotel,Restaurant,Lodge,Dhaba,Sarai and Dharamshala) situated in the Yatra Route from Gangnani
to Gangotri Dham, Badkot to Yamnotri Dham , Joshimath to Badrinath Dham and Tilwara to Shri
Kedarnath Dham. In this connection UPCL vide its letter dated 09.02.2017 requested GoU to
released Rs. 4.37 Crore towards the billing amount to be waived off. The payment of this amount is
awaited from GoU.
The Petitioner has submitted copies of all the references made hereinabove has been
submitted to the Commission vide UPCL’s letter no. 2618/UPCL/RM/C-13, dated 28.06.2017.
The Commission directs the Petitioner to follow up for the balance payments pending
from GoU and intimate the receipt to the Commission.

7.1.36 Collection Efficiency
UPCL was directed to explore the possibility of waiving the service charges being recovered
from the consumers on payment of bills using its payment gateway & submit the compliance on the
same to the Commission within one month of the date of the Order.
The Petitioner submitted that presently 3 agencies i.e. M/s Tech Process Payment Services
Limited, M/s My Mobile Payment Limited and CSC e- Governance of India Limited are providing
bill collection services to UPCL. During FY 2016-17 the Petitioner submitted the details of payment
collected through these agencies and service charge borne by UPCL / Consumers as follows:
Table 7.14: Details of payment collected through the Bill Collection

Agencies
No. of bills whose Who borne Amount Service charge
S.
payment has been service collected including tax (Rs.
No.
received charge (Rs. lakh) lakh)
1. 157162 UPCL 1168.18 7.25
2. 632866 Consumer 43378.27 93.81
Total 790028 44546.45 101.06
The Petitioner further submitted that no. of transactions will increase in future and the
service charge will also increase. Presently, about Rs. 1 Cr. is being borne by the consumers as
service charge for payment of the bills which is about 0.22% of the amount collected. This value will
increase in future. Keeping in view the low amount of the service charge presently being borne by
the Consumers may be borne by UPCL if the said amount is approved as expenditure in the ARR of
UPCL.
The Commission has noted the submissions of the Petitioner. As discussed in Chapter 2 of
this Order the Commission is of the view that it will assist UPCL in getting payments credited to its
accounts quickly and it also saves it towards holding and carrying cost of cash. Hence, UPCL is
directed not to charge any service charges from the consumers on payment of bills using its
payment gateway & submit the compliance on the same to the Commission within one month of
the date of the Order.

7.1.37 Metering & Billing
The Commission directed UPCL to provide following services to the consumers namely
restoration of power, voltage fluctuation, metering and billing related etc. as per Orders/Supply
Code/SOP Regulations of the Commission.
The Commission also directed the Petitioner to start adjusting the Open Access energy in the
consumer bill in the same month/billing cycle within one month of issue of this Order.
The Commission further directed UPCL to submit an action plan for compliances of the
Judgments referred by Shri Mandok of Hon’ble Allahabad High Court & Hon’ble Supreme Court
within one month of the date of the Order.
The Petitioner submitted that UPCL vide its letter no. 1531/UPCL/RM/C-13, dated 11-04-
2017 directed all the Chief Engineers (Distribution), Superintending Engineers (Distribution),
Executive Engineers (Distribution) and Executive Engineers (Test) to provide Consumer Services as
per orders / supply code / SOP Regulations of the Commission.
As regards direction issued in the matter of adjusting open access energy in the consumer
bill in the same month / billing cycle, the Petitioner submitted that presently the work of adjusting
open access energy is being done manually by the field units. This adjustment is being given in the
next month of transaction. This work has been planned through software under R-APDRP Cell,
which will take some time and the software will be operative by the end of March, 2018 and
thereafter the open access energy will be adjusted through software in the same month / billing
cycle. However, field units vide O.M. dated 01.07.2017 have been directed to adjust the open access
energy in the bill for the month of the transaction.
With regard to action plan for compliance of Judgment of Hon’ble High Court the Petitioner
submitted the suggestion made by Shri G. D. Mandhok as follows:
a. As per Section – 185 (1) of the Electricity Act, 2003, the Indian Electricity Act, 1910 is
repealed and the provisions of Electricity Act, 2003 are applicable now. As per Section –
55 (1) of the Electricity Act, 2003, Central Electricity Authority issued CEA (Installation
and Operation of Meters) Regulations, 2006 as amended from time to time. As per
Regulation – 7 (2) of these Regulations, Consumer Meter may be installed either at the
consumer premises or outside to consumer premises. Hence, Judgment issued by the

Hon’ble High Court in the matter in 1977 as per the provisions of Indian Electricity Act,
1910 is not relevant now.
b. As regards providing meter reading cards to the consumers, it is submitted that the
reading of the consumers is taken now through hand held device and the bill is delivered
to the consumer at the time of meter reading. All bills are available with the consumers
wherein meter reading is available therefore there is no need now for meter reading
cards.
c. As regards demand for separate disconnection notice from the Electricity Bill it is
submitted that as per the Judgment issued by the Hon’ble Courts, the consumer may be
issued Electricity Bill cum disconnection notice.
The Commission has noted the compliances submitted by the Petitioner. In this regard,
the Commission directs the Petitioner to submit the status of implementation of adjusting the
open access energy through the software under R-APDRP Cell latest by May 31, 2018.
7.1.38 Construction of 33/11 kV Sub-station
The Commission directed UPCL to speed-up the construction process and submit the
update on its status to the Commission within one month of this Order.
The Petitioner has submitted the following status has been reported to the Commission vide
UPCL’s letter no. 4312/UPCL/RM/C-13, dated 24.10.2017:
1. The work has been allotted to M/s Mittal Machines (P) Ltd vide C&P L.O.A. No-1115
dated 22.12.2016. The period for construction is 9 months form date of handover of
land.
2. The land was handed over to the contractor for the construction of the substation on
8.06.2017. Therefore the date of start for above work is 08.06.2017.
3. The completion period is 9 months from the date of start as per agreement and will be
completed by March 2018.
4. BOQ has been approved and Land Development work is under progress.
The Commission has noted the compliance submitted by the Petitioner.
7.1.39 LED Distribution
The Commission directed UPCL to submit status report on the LED distribution scheme
alongwith the future course of action planned by the Petitioner in this regard within one month of
issuance of this Order.
The Petitioner submitted that upto March, 2017 a total of 38.85 lacs LED bulbs have been
distribution in the State. Out of which 2.02 lacs 7W LED bulbs to BPL consumers & 1.98 lacs 7W
LED bulbs to other domestic consumers, having consumption upto 100 units have been distributed
on subsidized rates.
The Petitioner submitted that distribution of 9W LED bulbs, 20W LED Tube Light & 50W
Energy Efficient Ceiling Fans has also been initiated in the State w.e.f. 10th April, 2017 onwards.
The status of distribution is as follows:
Table 7.15: Status of Distribution of Energy Efficient Equipments

50W 5 Star
Month 9W LED Bulbs 20W EE Tube Lights
Rated Fans
April, 17 20376 323 23
May, 17 73771 899 376
June, 17 89892 1865 688
July, 17 51633 1999 141
August, 17 93605 3914 711
September, 17 95476 4885 595
Total 424753 13885 2534
7.1.40 Defective Metering Correction
The Commission directed UPCL to submit a report on the factual position alongwith its
comments on the issues raised by the above stakeholders within one month of issuance of this
Order.

The Petitioner submitted that UPCL vide its letter no. 2291/Dir(Opr.)/UPCL/C-4, dated
19.06.2017 reported as follows to the Commission regarding Defective Meter Correction:-
“It is submitted that UPCL is not agree with the stakeholder’s view as if connections (CT or PT) are
not in order then the quantum of energy recorded less/high will depend on many number of
Parameters and thus the exact amount of energy can be known through check meter with separate
CT/PT. However, in this case assessment should be made from the date since when the connection
gone wrong.”
As regards availability of suggestion box for people at different places in the State so as to
ensure maximum participation during Tariff proceedings, the Petitioner submitted that action shall
be taken by UPCL in the matter as per the direction of the Commission.
7.1.41 Online Load Survey Reports
The Commission directed UPCL to take up this suggestion and submit the factual position
and also Action Plan for implementation of the above suggestions of the stakeholders with one
month of the issuance of this Order.
The Petitioner submitted that load survey data is a bulky data and providing such data on
web platform will heavily load the UPCL portal. However, load survey report may be provided to
the Consumers on payment of charges as specified on the Tariff Order. This information has been
provided to the Commission vide UPCL’s letter no. 2014/UPCL/RM/C-13, dated 15.05.2017.
7.1.42 Delay in Fault Rectification
The Commission directed UPCL to follow the Electricity Supply Code Regulations for its
fault rectifications.
UPCL vide its letter no. 1858/UPCL/RM/C-13, dated 03.05.2017 directed all the field
officers to provide the Electricity connection within 15 days where no infrastructure is required to
be extended. Further, they are also directed to release new connections within time as stipulated in
the Regulations.
7.1.43 Proof of Ownership
The Commission directed the Petitioner to submit the details regarding the process of
releasing of connections alongwith the status of the connection released in Almora within one
month of the date of Order.
The Petitioner submitted that in this case, consumer had applied for a temporary connection
alongwith a copy of driving license as identity proof and a copy of lease deed as ownership proof.
The desired information has been provided to the Commission vide UPCL’s letter no.
2014/UPCL/RM/C-13, dated 15.05.2017.
7.1.44 Tariff Revenue
The Petitioner was directed to properly account for the revenues from tariff as well as non-
tariff income.
The Petitioner submitted that it is being done as per the direction of Commission.
7.1.45 Distribution Loss Trajectory
The Petitioner was directed to abstain from seeking relaxation in this regard in every
ensuing Tariff Petition once the issue has been settled by the Commission.
The Petitioner submitted that the Commission while fixing the distribution loss trajectory for
the control period from FY 2016-17 to FY 2018-19, did not consider the actual losses of the Company
and therefore UPCL prayed the Commission to fix the loss reduction target considering the actual
losses of the Company for the previous years. Moreover, the Petitioner submitted that the level of
distribution losses as fixed by Commission is less than the losses as fixed by the Ministry of Power,
Government of India.
As discussed in Chapter 4 of this Order, the Petitioner is directed to abstain from seeking
relaxation in this regard in every ensuing Tariff Petition once the issue has been settled by the
Commission.
7.1.46 Impact of Seventh Pay Commission
The Petitioner was directed to maintain separate details of the amount paid as arrears to its
employees on account of implementation of the recommendations of VII Pay Commission.
The Petitioner submitted that the said details shall be maintained as per the Commission’s
direction.
7.1.47 Prepaid Metering
The Petitioner was directed to submit the details of such new connections issued from
December 01, 2016 and the number of prepaid connections thereon. UPCL is also required to submit
the number of prepaid meters available with it within one month of the date of Order.
In compliance of direction issued by Commission, UPCL procured 5000 no. single phase and
1000 no. three phase prepaid meters so far.
The petitioner submitted the status of prepaid meters installed on monthly basis from
December, 2016 is as follows:

Table 7.16: Status of Prepaid Meter installed on monthly basis

Month No. of Prepaid Meters Installed
December, 2016 Nil
January, 2017 Nil
February, 2017 Nil
March, 2017 Nil
April, 2017 Nil
May, 2017 Nil
June, 2017 01
July, 2017 11
August, 2017 100
September, 2017 241
October, 2017 390
November, 2017 68 (upto 06-11-2017)
7.1.48 Current Ratio
The Petitioner was directed to carry out the age-wise analysis of its current liabilities
outstanding as on 31.03.2016 and based on the ageing analysis determine how much of the same
would be required to be discharged and how much excess provision exists in the same so that the
same may be reversed and submit the same to the Commission within 3 months from the date of
Order.
The Petitioner submitted age wise position of creditors for power purchase as on 31.03.2016
was submitted to the Commission vide UPCL’s letter no. 2751/UPCL/RM/C-13, dated 06.07.2017,
as follows:
 Age 0 to 3 months - Rs. 1073.78 Cr.
 Age 3 to 6 months - Rs. 14.98 Cr.
 Age more than months - Rs. 1610.26 Cr.
 Total - Rs. 2699.02 Cr.

The Petitioner further submitted age-wise position of Creditors for Power purchase as on
31.03.2017 is as follows:
 Age 0 to 3 months : Rs. 802.19 Cr.

 Age 3 to 6 months : Rs. 106.31 Cr.
 Age more than 6 months : Rs.1250.62 Cr.
 Total : Rs.2159.12 Cr.

Further the Peitioner submitted a sum of Rs.10.93 Cr. was reversed in FY 2016-17 pertaining
to excess provision for expenses made in previous years.
7.1.49 Repair & Maintenance to Inventory Ratio
The Petitioner was directed to submit the following details within one month of the date of
Order:

b) The accounting policies adopted in measuring inventories, including the cost
formula used;
c) Basis on which inventories issued: FIFO/LIFO/etc. and reason for choosing the
same.
d) Whether any inventory classification, such as ABC analysis has been done? If yes the
same may be submitted and if no, reason for the same may be furnished?
e) Whether the inventories are verified physically? If yes, the periodicity of the same,
alongwith the report of last physical verification. If physical verification is not being
conducted reasons for the same?
The Petitioner submitted that the desired information has been submitted to the
Commission vide UPCL’s letter no. 2668/UPCL/RM/C-13, dated 01.07.2017.
7.1.50 Average Collection Period
The Petitioner was directed to submit within 3 months, an action plan to improve its
collection period.

The Petitioner submitted that UPCL vide its letter no. 1597/UPCL/RM/L-17, dated
17.04.2017 and no. 1654/UPCL/RM/L-17, dated 19.04.2017 fixed the division wise Annual and
Daily Revenue Collection Targets. These targets have been issued to achieve 14.75% AT&C Losses
as approved by the Commission in its Tariff Order dated 29.03.2017. This will improve the
collection period of UPCL. On issuance of order dated 03.08.2017 on the review petition of UPCL,
UPCL revised its targets vide letter no. 3354/UPCL/RM/L-17, dated 17.08.2017.
Further with a view to recovery of Arrears and Writing Off of fictitious and irrecoverable
arrears, UPCL has identified 1,81,026 electricity connections lying disconnected and being shown
in the data base as Not billed/Stop billed. The arrear against these connections are Rs. 570.25 Cr. in
the record. UPCL has prepared an action plan to settle these cases in FY 2017-18 by Writing Off
fictitious arrears and irrecoverable arrears and by collecting the recoverable amount. Field officers
have been directed to take action as per this action plan circulated vide letter no.
1843/UPCL/RM/N-20, dated 02.05.2017. This will improve the collection period.
The Commission has noted the compliance submitted by the Petitioner. The Petitioner is
directed to submit within 3 months, an action plan to improve its collection period.
7.2 Fresh Directives
7.2.1 Departmental Employees
The Commission further to streamline the accounting of departmental employee

consumers directs the Petitioner to bill all departmental employees consumers on the basis of
rates approved for the RTS-1 Domestic Category from April 01, 2018.The Petitioner shall include
the consumption and revenue details of these consumers at the Domestic Tariff Rate in the
monthly CS-3 and CS-4 statements. As regards the concession provided to these consumers, the
Petitioner is directed to show the same separately as expenses in its accounts. (Refer 2.20.1.3)
7.2.2 Billing
UPCL is directed to explore this option at least in urban areas which will not only
improve its financial position but also will aid in proper identifying cases of NA/NR/IDF/ADF

etc. and will provide relief to the consumers also and submit its report in the matter within 3
months of the date of the Order. (Refer 2.20.1.3)
7.2.3 Temporary Connection
The Commission directs the Petitioner to issue instructions to its field/ distribution
division officers to issue the proper temporary connections with prepaid meters for functions
like marriages, ceremonies and other similar purposes and should not provide any illegal
connection. (Refer 2.21.1.3)
The Commission directs UPCL to make efforts to achieve the collection efficiency targets
approved by the Commission. (Refer 2.25.1.3)
7.2.5 Views of State Advisory Committee
The Commission directs UPCL to address the concerns raised by the Members of the
Advisory Committee and submit an Action Taken Report within one month of the date of Order.
(Refer 2.28.1.3)
7.2.6 Cost of Free Power
Further, the Petitioner is also directed to submit the details of cost of free power as
booked in the accounts, cost of free power trued up by the Commission and the amount remitted
to GoU by the Petitioner in this regard from FY 2001-02 to FY 2010-11 within 3 months of the date
of the Order. (Refer 3.2.3)
7.2.7 Depreciation
The Commission directs the Petitioner to claim depreciation in line with its practice
followed in the accounts. (Refer 3.3.2.1.2)
7.2.8 Bad Debt

In this regard, UPCL is again directed to refrain itself from treating rectification of wrong
billing made in the earlier period as writing off the bad debts. (Refer 3.3.3)

7.2.9 Distribution Loss
The Commission directs the Petitioner to submit division wise action plan to reduce the
losses in the above divisions to below 20% within one month from the date of issuance of this
Order. (Refer 4.3)
7.2.10 Impact of VII Pay Commission

The Petitioner is directed to maintain separate details of the amount paid as arrears to its
employees on account of implementation of the recommendations of VII Pay Commission.
(Refer 4.11.3)
7.2.11 Additional A&G Expenses
The Petitioner is directed to book these expenses separately under the relevant
accounting head, i.e. R&M expenses or A&G expenses and claim the same during truing up of
the respective years. (Refer 4.11.5)
7.2.12 Adjustment of Free Power

The Commission also directs the Petitioner to refrain from such financial engineering in
its future proposals in the absence of firm assurances/commitments from the State Government
which results in misleading all the stakeholders. (Refer 4.11.14)
7.2.13 Consumer Mix

The Commission directs UPCL not to indicate any un-metered category in its commercial
diary and should ensure that no energy should be booked, in this account. In absence of the
corrective action at UPCL’s end, action under provisions of Act/Rules/Regulations would be
initiated. (Refer 6.1.1)
7.2.14 Conductor Augmentation
The Petitioner is directed to indentify such feeders/spans where the power distribution
network is on GI wire and replace them with the ACSR or better conductors latest by 30.09.2018
and submit a compliance report under affidavit on the same.

Moreover, the Petitioner is also directed to prepare and submit an action plan for
checking and refurbishment of protection systems at various 33/11 kV sub-stations latest by
30.06.2018. (Refer 6.4)
7.2.15 Inventory Management
Considering the high level of inventories maintained by UPCL, the Commission feels the
same as a prima-facie lapse on the part of the Petitioner with regard to inventory management,
the Petitioner is directed to submit the following details within one month of the date of Order
failing which appropriate action will be initiated under the Act:

b) The accounting policies adopted in measuring inventories, including the
cost formula used;
c) Basis on which inventories issued: FIFO/LIFO/etc. and reason for choosing the
same.
d) Whether any inventory classification, such as ABC analysis has been done? If
yes the same may be submitted and if no, reason for the same may be
furnished?
e) Whether the inventories are verified physically? If yes, the periodicity of the
same, alongwith the report of last physical verification. If physical verification
is not being conducted reasons for the same? (Refer 6.5.4)
In this regard, the Commission directs UPCL to submit a plan to demonstrate as to how it
will work in the direction of improving its actual collection so that the gap between the actual
collection efficiency and the collection efficiency approved by the Commission may be brought
to minimum. (Refer 6.5.5.2)
7.3 Conclusion
Having considered the submissions made by the Petitioner, the responses of various
stakeholders and the relevant provisions of the Electricity Act, 2003 and Regulations of the
Commission, the Commission hereby approves that:

(i) Uttarakhand Power Corporation Ltd., the distribution and retail supply licensee in
the State will be entitled to charge the tariffs from consumers in its licensed area of
supply as given in the Rate Schedule for FY 2018-19 annexed hereto as Annexure-
1. These Tariffs will be effective from April 01, 2018.
(ii) Uttarakhand Power Corporation Ltd., the distribution and retail supply licensee in
the State will realize from consumers of Electricity in the State, miscellaneous
charges as listed out in Annexure- 2 of this Order and shall not recover any other
charge, fee, deposit etc., unless approved by the Commission.
(iii) The above tariffs shall continue to be applicable till revised by the Commission.
The Petitioner shall forward a report on compliance of the directions given in this Order
within the time stipulated for compliance.
(Subhash Kumar)
Chairman

8. Annexures
8.1 Annexure 1: Rate Schedule Effective from 01.04.2018
A. General Conditions of Supply
1. Character of Service
i) Alternating Current 50 Hz., single phase, 230 Volts (with permissible variations) up to a
load of 4 kW.
ii) Alternating Current 50 Hz, three phase, 4 wire, 400 Volts or above (with permissible
variations) for loads above 4 kW depending upon the availability of voltage of supply.
2. Conditions for New Connections
i) Supply to new connections of more than 75 kW (88 kVA) and up to 2550 kW (3000 kVA)
shall be released at 11 kV or above, loads above 2550 kW (3000 kVA) and upto 8500 kW
(10000 kVA) shall be released at 33 kV or above and loads above 8500 kW (10000 kVA)
shall be released at 132 kV or above.
ii) All new connections shall be given with meter conforming to CEA Regulations on
Installation and Operation of Meters.
iii) All new 3 phase connections above 4 kW shall be released with Electronic Tri-vector
Meter having Maximum Demand Indicator.
iv) All new Single Point Bulk Connection shall be given only for Load of more than 75 kW.
v) Consumers having motive loads of more than 5 BHP shall install Shunt Capacitor of
appropriate rating and conforming to BIS specification.
vi) All new connections at HT/EHT should be released only with 3 phase 4 wire meters.
3. Point of Supply
Energy will be supplied to a consumer at a single point.
4. Billing in Defective Meter (ADF/IDF), Meter Not Read/Not Accessible (NA/NR)

and Defective Reading (RDF) Cases

In NA/NR cases, the energy consumption shall be assessed and billed as per average
consumption of last one year average consumption (as per the Electricity Supply Code) which shall
be subject to adjustment when actual reading is taken. Such provisional billing shall not continue
for more than two billing cycles at a stretch. Thereafter, the licensee shall not be entitled to raise
any bill on provisional basis. In case of Appear defective meter (ADF) Identified defective meter
(IDF) and Reading defect (RDF) cases, the consumers shall be billed on the basis of the average
consumption of the past three billing cycles immediately preceding the date of the meter being
found or being reported defective (as per the Electricity Supply Code). These charges shall be
leviable for a maximum period of three months or two billing cycle in case of bi-monthly billing
only during which time the licensee is required to replace the defective meter. Thereafter, the
licensee shall not be entitled to raise any bill without correct meters.
The checking and replacement of defective meter cases namely IDF and ADF and defective
reading cases namely RDF shall be done by the licensee in accordance with Regulation 3.1.4 of the
Electricity Supply Code.
5. Billing in case of domestic metered consumers in rural/hilly areas whose meters

are not being read
For cases relating to domestic metered consumers in rural/hilly areas, where meter reading
is either not being taken regularly or taken randomly over delayed interval of time, the provisional
billing under these circumstances for such consumers shall be done at the normative levels of
consumption as given below, which shall be subject to annual adjustment based on actual meter
reading.
Category Normative Consumption

Domestic (Rural-Hilly Areas) 30 kWh/kW/month
Domestic (Rural-Other Areas) 50 kWh/kW/month
For this purpose, the contracted load shall be rounded off to next whole number. Billing on
this basis is subject to annual adjustment and the licensee is to ensure meter reading of such
consumers at least once a year.
6. Billing in New Connection or conversion from unmetered to metered Cases
For cases such as new connections or conversion of unmetered to metered connection, where
past reading is not available, the provisional billing shall be done at the normative levels of
8. Annexures
consumption as given below, which shall be subject to adjustment when actual reading is taken.
Category Normative Consumption

Domestic (Urban) 100 kWh/kW/month
Domestic (Rural-Hilly Areas) 30 kWh/kW/month
Domestic (Rural-Other Areas) 50 kWh/kW/month
Non-domestic (Urban) 150 kWh/kW/month
Non-domestic (Rural) 100 kWh/kW/month
Private Tube Wells 60 kWh/BHP/month
Industry
LT Industry 150 kWh/kW/month
HT Industry 150 kVAh/kVA /month
For this purpose, the contracted load shall be rounded off to next whole number. Billing on
this basis shall continue only for a maximum period of 2 billing cycles, during which the licensee
should ensure actual reading. Thereafter, the licensee shall not be entitled to raise any bill without
correct meter reading. In all other categories, 1st bill shall be raised only on actual reading.
7. Delayed Payment Surcharge (DPS) (for all categories except PTW)
In the event of electricity bill rendered by licensee, not being paid in full within 15 days’
grace period after due date, a surcharge of 1.25% on the principal amount of the bill which has not
been paid, shall be levied from the original due date for each successive month or part thereof until
the payment is made in full without prejudice to the right of the licensee to disconnect the supply in
accordance with Section 56 of the Electricity Act, 2003. The licensee shall clearly indicate in the bill
itself the total amount, including DPS, payable for different dates after the due date, after allowing
for the grace period of 15 days, taking month as the unit as shown exemplified below:
EXAMPLE:
Amount payable by Due date Rs. 100/-
Due Date 1st May 2018
Amount Payable
On or Before After After

16th May 2018 16th May 2018 1st June 2018
Rs. 100/- Rs. 101.25 Rs. 102.50

8. Solar Water Heater rebate
If consumer installs and uses solar water heating system, rebate of Rs. 100/- p.m. for each
100 litre capacity of the system or actual bill for that month whichever is lower shall be given
subject to the condition that consumer gives an affidavit to the licensee to the effect that he has
installed such system, which the licensee shall be free to verify from time to time. If any such claim
is found to be false, in addition to punitive legal action that may be taken against such consumer,
the licensee will recover the total rebate allowed to the consumer with 100% penalty and debar him
from availing such rebate for the next 12 months.
9. Prepaid Metering
Prepaid metering scheme approved by the Commission in this Order shall be applicable. A
rebate of 4% of energy charges for Domestic category (RTS-1 and RTS-1A) and 3% of energy charges
for Other LT consumers shall be allowed to the consumers under the Prepaid Metering Scheme
from the date of installation and operationalisation of Prepaid Meters. However, no rebate shall be
applicable on RTS-8, i.e. Temporary Supply. Solar water rebate as provided above in the Rate
Schedule shall be applicable on prepaid consumers also subject to fulfillment of conditions
provided therein.
10. Rebate/surcharge for availing supply at voltage higher/lower than base voltage
(i) For consumers having contracted load upto 75 kW/88 kVA - If the supply is given at
voltage above 400 Volts and upto 11 kV, a rebate of 5% would be admissible on the
Energy Charge.
(ii) For consumers having contracted load above 75 kW/88 kVA – In case the supply is
given at 400 Volts, the consumer shall be required to pay an extra charge of 10% on the
bill amount calculated at the Energy Charge.
(iii) For consumers having contracted load above 75 kW/88 kVA – In case of supply at 33
kV the consumer shall receive a rebate of 2.5% on the Energy Charge.
(iv) For consumers having contracted load above 75 kW/88 kVA and receiving supply at
132 kV and above, the consumer shall receive a rebate of 7.5% on the Energy Charge.
(v) All voltages mentioned above are nominal rated voltages.

8. Annexures
(vi) No rebate or surcharges would be applicable on consumers having pre-paid

connections.
11. Low Power Factor Surcharge (not applicable to Domestic, PTW categories and also
to other categories having kVAh based Tariff)
(i) On the consumers without Electronic Tri Vector Meters who have not installed shunt
capacitors of appropriate ratings and specifications, a surcharge of 5% on the current
energy charges shall be levied.
(ii) On consumers with Electronic Tri Vector Meters, a surcharge of 5% on current energy
charges will be levied for having power factor below 0.85 and upto 0.80 & a surcharge
of 10% of current energy charges will be levied for having power factor below 0.80.
(iii) No surcharge would be applicable on consumers having pre-paid connections.
12. Excess Load/Demand Penalty (Not applicable to Domestic, Snow bound and PTW
categories)
In case of consumers where electronic meters with MDI have been installed, if the maximum
demand recorded in any month exceeds the contracted load/demand, charges for such excess
load/demand shall be levied equal to twice the normal rate of fixed/demand charge as applicable.
Such excess load penalty shall be levied only for the month in which maximum demands exceeds
contracted load. However, no excess load penalty would be applicable on consumers having pre-
paid connections.
Example:
(i) For consumers where fixed charges on the basis of contracted load/demand have been
specified:
Contracted load 30 kW, Maximum Demand 43 kW,

Excess Demand 43-30=13 kW, Rate of Fixed Charges= Rs. 70/kW
Fixed Charges for contracted load = 30 x 70=Rs. 2100
Fixed Charges for excess load = 13x (2 x70) =Rs. 1820
Total Fixed Charges = 2100+1820= Rs. 3920
(ii) For industrial consumers billed on billable demand:

Contracted demand 2500 kVA, Maximum Demand 2800 kVA, Billable Demand =2800
kVA
Excess Demand =2800-2500=300 kVA, Rate of Demand Charges= Rs. 355/kVA
Demand Charges for contracted demand =2500 x 355=Rs. 887500
Demand Charges for excess demand = 300x (2 x 355) =Rs. 213000
Total Demand Charges = 887500+213000= Rs. 1100500
13. Single Point Bulk Supply for Domestic, Non Domestic and Mixed Load
Categories
(i) Single Point Bulk Supply connection shall only be allowed for Sanctioned/Contracted
Load above 75 kW with single point metering for further distribution to the end users.
However, this shall not restrict the individual owner/occupier from applying for
individual connection.
(ii) The person who has taken the single point supply shall be responsible for all payments
of electricity charges to the Licensee and collection from the end consumer as per tariff
prescribed for such consumer. The Licensee shall ensure that tariff being charged from
end consumer does not exceed the prescribed tariff for the concerned category of the
consumer.
(iii) The person who has taken the single point supply shall also be deemed to be an agent
of Licensee to undertake distribution of electricity for the premises for which single
point supply is given under seventh proviso to section 14 of the Electricity Act, 2003
and distribution licensee shall be responsible for compliance of all provisions of the
Act and Rules & Regulations thereunder within such area.
(iv) Single Point Bulk Supply under “Domestic” shall only be applicable for Residential
Colonies/Residential Multistoreyed Buildings including common facilities (such as
Lifts, Common Lighting and Water Pumping system) of such Residential
Colonies/Residential Multistoreyed Buildings. In case these Residential
Colonies/Residential Multistoreyed Buildings also have some shops or other
commercial establishments, the tariff of Mixed Load shall be applicable for such
premises.

8. Annexures
(v) Single Point Bulk Supply Under “Non-Domestic” shall only be applicable for Shopping
Complexes/Multiplex/Malls.
14. Rounding off
(i) The contracted load/demand shall be expressed in whole number only and fractional
load/demand shall be rounded up to next whole number.
Example:
Contracted/Sanctioned Load of 0.15 kW shall be reckoned as 1 kW for tariff purposes.

Similarly, contracted/sanctioned load of 15.25 kW/kVA shall be taken as 16 kW/kVA.
(ii) All bills will be rounded off to the nearest rupee.
15. Other Charges
Apart from the charges provided in the Rate of Charge and those included in the Schedule of
Miscellaneous Charges, no other charge shall be recovered from the consumer unless approved by
the Commission.

B. Tariffs
RTS-1: Domestic
1. Applicability
This schedule shall apply to supply of power to:

(i) Residential premises (including premises of Departmental Employees & Pensioners of
UPCL, PTCUL and UJVN Ltd.) for light, fan, power and other domestic purposes
including common facilities (such as Lifts, Common Lighting and Water Pumping
system)
(ii) Single Point Bulk Supply above 75 kW for Residential Colonies, Residential Multi-
storeyed buildings where energy is exclusively used for domestic purpose including
common facilities (such as Lifts, Common Lighting and Water Pumping system) of
such Residential Colonies/Residential Multistoreyed Buildings
(iii) Places of worship, i.e. Mandir, Masjid, Gurudwara, Church, etc. (only for standalone
places of worship and not for the places of worship which have other facilities such as
Dharamshala, Community Hall, Dormatories, etc. attached with it)
(This rate schedule shall also be applicable to consumers having contracted load upto 2 kW
as also consumption upto 200 kWh/month and who are using some portion of the premises
mentioned above for non-domestic purposes. However, if either contracted load for such premises
is above 2 kW or consumption is more than 200 kWh/month, then the entire energy consumed shall
be charged under the appropriate Rate Schedule unless such load is segregated and separately
metered.)
2. Rate of Charge
Description Fixed Charges* Energy Charges
1) Domestic
1.1)BPL/Life line consumers
Below Poverty Line and Kutir Jyoti having load upto 1 kW and Rs. 18/
Rs. 1.61/kWh
consumption upto 60 units per month connection/month
1.2) Other Domestic Consumers
Upto 100 units per month Rs. 55 /month Rs. 2.65/kWh
101-200 units per month Rs. 80 /month Rs. 3.45/kWh
201-400 units per month Rs. 135/month Rs. 4.70/kWh
Above 400 units per month Rs. 220/month Rs. 5.40/kWh
2) Single Point Bulk Supply Rs. 70/kW/month Rs. 4.25/kWh
*Fixed Charges in case of other domestic consumers for the month shall be charged at the rates equivalent to the total consumption
in the month.

8. Annexures
RTS-1A: Snowbound
1. Applicability
(i) Domestic and non-domestic consumers in snowbound areas.

(ii) This Schedule applies to areas notified as snowbound/snowline areas by the
concerned District Magistrate.
2. Rate of Charge
Description Fixed Charges
Energy charges
1) Domestic Rs. 1.61/kWh
2) Non-domestic upto 1 kW Rs.18/connection/month Rs. 1.61/kWh
3) Non-domestic more than 1 kW & upto 4 kW Rs. 2.36/kWh
4) Non-Domestic more than 4 kW Rs. 30/connection/month Rs. 3.51/kWh
3. All other conditions of this Schedule shall be same as those in RTS-1.

RTS-2: Non-Domestic
1. Applicability
This schedule should apply to supply of power to:
1.1 (i) Government/Municipal Hospitals
(ii) Government/Government Aided Educational Institutions
(iii) Charitable Institutions registered under the Income Tax Act, 1961 and whose income
is exempted from tax under this Act.
1.2 Small Non Domestic Consumers with connected load upto 4 kW and consumption upto 50
units per month.
1.3 Other Non-Domestic Users including single point bulk supply above 75 kW for shopping
complexes/multiplex/malls including common facilities (such as lifts, common lighting and
water pumping system).
1.4 Independent Advertisement Boards/Hoardings - All commercial (road side / roof top or on
the side of the buildings etc.) standalone independent advertisement hoardings such as
private advertising sign posts/ sign boards/ sign glows/flex that are independently
metered through a separate meter.
2. Rate of Charge
S.
Description Fixed Charges Energy charges
No.
(i) Government/Municipal Hospitals
(ii) Government/Government Aided Educational Institutions
(iii) Charitable Institutions registered under the Income Tax Act, 1961 and
1.1
whose income is exempted from tax under this Act
(a) Upto 25 kW Rs. 60/ kW Rs. 4.35/ kWh
(b) Above 25 kW Rs. 70/ kVA Rs. 4.05/ kVAh
Other Non-Domestic Users
(a) Small Non-Domestic Consumers with connected load upto 4 kW and
Rs. 65 / kW Rs. 4.55/ kWh
1.2 consumption upto 50 units per month*
(b) Others upto 25 kW not covered in 1.2(a) above Rs. 70 / kW Rs. 5.35/ kWh
(c) Above 25 kW Rs. 70 / kVA Rs. 5.25/ kVAh
1.3 Single Point Bulk Supply** Rs. 70 / kVA Rs. 5.15/ kVAh
1.4 Independent Advertisement Hoardings Rs. 85/kW Rs. 5.80/kWh
* If consumption exceeds 50 units/month, then on the entire energy consumed tariff as per sub-category 1.2(b) shall be charged
** For loads above 75 kW for shopping complexes/multiplex/malls
3. Other Conditions
3.1 ToD Meters shall be read by Meter Reading Instrument (MRI) only with complete dump
with phasor diagram, Tamper Reports, full load survey reports etc. shall be downloaded
for the purpose of complete analysis.
3.2 All consumers above 25 kW shall necessarily have ToD Meters.

8. Annexures
3.3 No meter shall be read at zero load or very low load. Licensee shall carry appropriate
external load and shall apply the same, wherever, necessary to take MRI at load.
3.4 Copy of MRI Summary Report shall be provided alongwith the Bill. Full MRI Report
including load survey report shall be provided on demand and on payment of Rs. 15/
Bill.

RTS-3: Govt. Public Utilities
1. Applicability
(i) Public lamps including street lighting system, traffic control signals, lighting of public
parks, etc. The street lighting of Harijan Bastis and villages are also covered by this
Rate Schedule.
(ii) State Tubewells, World Bank Tubewells, Pumped Canals and Lift irrigation schemes,
Laghu Dal Nahar etc.,
(iii) Irrigation system owned and operated by any Government department.
(iv) Public Water Works, Sewage Treatment Plants and Sewage Pumping Stations
functioning under Jal Sansthan, Jal Nigam or other local bodies and Plastic Recycling
Plants.
2. Rate of Charge
Category Fixed Charges* Energy Charge

Urban (Metered) Rs. 60/kVA/month Rs. 4.85/ kVAh
Rural (Metered) Rs. 50/kVA/month Rs. 4.85/ kVAh
* The Urban and Rural differentiation will apply only for supply of power to 1(i) & 1(iv) above.
3. Maintenance Charge for Public Lamps
In addition to the “Rate of Charge” mentioned above, a sum of Rs. 10/- per light point per
month shall be charged for operation and maintenance of street lights covering only labour charges
where all material required will be supplied by the local bodies. However, the local bodies will have
the option to operate and maintain the public lamps themselves and in such case no maintenance
charge will be charged.
4. Provisions of Street Light Systems
In case, the maintenance charge, as mentioned above, is being charged then the labour
involved in the subsequent replacement or renewals of lamps shall be provided by the licensee but
all the material shall be provided by the local bodies. If licensee provides material at the request of
local body, cost of the same shall be chargeable from the local body.

8. Annexures
The cost involved in extension of street light mains (including cost of sub-stations if any) in
areas where distribution mains of the licensee have not been laid, will be paid for by the local
bodies.

RTS-4: Private Tube Wells/ Pumping Sets
1. Applicability
This schedule shall apply to supply of power to private tube-wells/pumping sets for
irrigation purposes and for incidental agricultural processes confined to chaff cutter, thrasher, cane
crusher and rice huller only. However, the tariff applicable for RTS-4 shall only be applicable if such
incidental agricultural processes are being carried out for agricultural produce of the connection
sanctioned for irrigation purposes.
2. Rate of charge
Fixed Charges Energy Charges
Category
Rs./BHP/Month Rs./kWh
RTS 4: PTW (Metered) Nil 1.84
3. Payments of bills and Surcharge for Late Payment
The bill shall be raised for this category twice a year only, i.e. by end of December (for
period June to November) and end of June (for period December to May). The bill raised in
December may be paid by the consumer either in lump-sum or in parts (not more than four times)
till 30th April next year for which no DPS shall be levied. Similarly, bill raised in June may be paid
by 31st October without any DPS. In case consumer fails to make payment within the specified
dates, a surcharge @ 1.25% per month for the period (months or part thereof) shall be payable on the
outstanding amount.

8. Annexures
RTS-4A: Agriculture Allied Activities
1. Applicability
This schedule shall apply to supply of power for use in nurseries growing plants/saplings,
polyhouses and other units growing flowers/vegetables and fruits including mushroom cultivation
which doesn’t involve any kind of processing of product except for storing and preservation.
2. Rate of charge
Category
Rs./BHP/Month Rs./kWh
RTS 4(A): Agricultural
Nil 1.84
Allied Services

RTS-5: LT and HT Industry
1. Applicability

(i) Industries and /or processing or agro- industrial purposes, power loom as well as to
Arc/Induction Furnaces, Rolling/Re-rolling Mills, Mini Steel Plants and to other
power consumers not covered under any other Rate Schedule.
(ii) The vegetable, fruits, floriculture & Mushroom integrated units engaged in processing,
storing and packaging in addition to farming and those not covered under RTS-4A
shall also be covered under this Rate Schedule.
2. Specific Conditions of Supply

(i) All connections shall be connected with MCB (Miniature Circuit Breaker) or Circuit
Breaker / Switch Gear of appropriate rating and BIS Specification.
(ii) The supply to Induction and Arc Furnaces shall be made available only after ensuring
that the loads sanctioned are corresponding to the load requirements of tonnage of
furnaces. The minimum load of 1 Tonne furnace shall in no case be less than 400 kVA
and all loads will be determined on this basis. No supply will be given for loads below
this norm.
(iii) Supply to Steel Units shall be made available at a voltage of 33 kV or above through a
dedicated individual feeder only with check meter at sub-station end. Difference of
more than 3%, between readings of check meter and consumer meter(s), shall be
immediately investigated by the licensee and corrective action shall be taken.
(iv) Supply to all new connections with load above 1000 kVA should be released on
independent feeders only with provisions as at (iii) above.

8. Annexures
Fixed /Demand Charge

Description Energy Charge
per month
1. LT Industry having contracted load upto

75kW (100 BHP)
Rs. 145/ kW of
1.1 Contracted load up to 25 kW Rs. 4.25/kWh
contracted load
Rs. 145/ kVA of

1.2 Contracted load more than 25 kW Rs. 3.90/kVAh
contracted load
2. HT Industry having contracted load

Load Factor# Rs./ kVAh
above 88 kVA/75 kW (100 BHP)
Upto 40% 3.85

Rs. 295/kVA of the
2.1 Contracted Load up to 1000 kVA
billable demand*
Above 40% 4.20
Upto 40% 3.85

Rs. 355/kVA of the
2.2 Contracted Load More than 1000 kVA
billable demand*
Above 40% 4.20
.
* Billable demand shall be the actual maximum demand or 80 % of the contracted load whichever is higher.
#For tariff purposes Load Factor (%) would be deemed to be =

Consumption (excluding the energy received through open access)during the billing period
 100
Maximum Demand or Contracted Demand whichever is less x No. of hours in the billing period
Provided that in cases where maximum demand during the month occurs in a period when open access is
being availed by the consumer, then maximum demand for the purpose of computation of load factor shall be
that occurring during the period when no open access is being availed.
3. Time of Day Tariff

(i) The rates of energy charge given above for LT industry with load more than 25 kW
and HT industry shall be subject to ToD rebate/surcharge.
(ii) ToD Meters shall be read by Meter Reading Instrument (MRI) only with complete
dump with phasor diagram, Tamper Reports, full load survey reports etc. shall be
downloaded for the purpose of complete analysis and bills shall be raised as per ToD
rate of charge.
(iii) No meter shall be read at zero load or very low load. Licensee shall carry appropriate
external load and shall apply the same, wherever, necessary to take MRI at load.

(iv) Copy of MRI Summary Report shall be provided along with the Bill. Full MRI Report
including load survey report shall be provided on demand and on payment of Rs. 15/
Bill.
(v) ToD Load shall be as under:
Season/Time of Morning Peak Normal Evening Peak Off-peak
day hours hours Hours Hours
Winters
0600-0930 hrs 0930-1730 hrs 1730-2200 hrs 2200-0600 hrs
01.10 to 31.03
Summers
-- 0700-1800 hrs 1800-2300 hrs 2300-0700 hrs
01.04 to 30.09
The, ToD Rate of Energy Charges shall be as under:

For LT Industry
Energy Charge during
Normal Hours Peak Hours Off-peak Hours
Rs. 3.90/kVAh Rs. 5.85/kVAh Rs. 3.22/kVAh
For HT Industry
Energy Charge during
Load Factor*
Normal Hours Peak Hours Off-peak Hours
Upto 40% Rs. 3.85/kVAh Rs. 6.30/kVAh Rs. 3.27/kVAh
Above 40% Rs. 4.20/kVAh Rs. 6.30/kVAh Rs. 3.57/kVAh
* Load Factor shall be as defined in Clause 2 above
4. Seasonal Industries
Where a consumer having load in excess of 18 kW (25 BHP) and ToD meter and avails
supply of energy for declared Seasonal industries during certain seasons or limited period in the
year, and his plant is regularly closed down during certain months of the financial year, he may be
levied for the months during which the plant is shut down (which period shall be referred to as off-
season period) as follows:
(i) The tariff for ‘Season’ period shall be same as “Rate of Charge” as given in this
schedule.
(ii) Where actual demand in ‘Off Season’ Period is not more than 30% of contracted load,
the energy charges for “Off-Season” period shall be same as energy charges for
“Season” period given in Rate of Schedule above. However, the contracted demand in
the “Off Season” period shall be reduced to 30%.

8. Annexures
(iii) During ‘Off-season’ period, the maximum allowable demand will be 30% of the
contracted demand and the consumers whose actual demand exceeds 30% of the
contracted demand in any month of the ‘Off Season’ will be denied the above benefit of
reduced contracted demand during that season. In addition, a surcharge at the rate of
10% of the demand charge shall be payable for the entire ‘Off Season’ period.
Terms and Conditions for Seasonal Industries
(i) The period of operation should not be more than 9 months in a financial year.
(ii) Where period of operation is more than 4 months in a financial year, such industry
should operate for at least consecutive 4 months.
(iii) The seasonal period once notified cannot be reduced during the year. The off-season
tariff is not applicable to composite units having seasonal and other categories of
loads.
(iv) Industries in addition to sugar, ice, rice mill, frozen foods and tea shall be notified by
Licensee only after prior approval of the Commission.
5. Factory Lighting
The electrical energy supplied under this schedule shall also be utilised in the factory
premises for lights, fans, coolers, etc. which shall mean and include all energy consumed for factory
lighting in the offices, the main factory building, stores, time keeper’s office, canteen, staff club,
library, creche, dispensary, staff welfare centres, compound lighting, etc.
6. Continuous and Non-continuous supply
(i) Continuous Process Industry as well as non continuous process industrial consumers
connected on either independent feeders or industrial feeder can opt for continuous
supply. For industrial feeder, all connected industries will have to opt for continuous
supply and in case any consumer on industrial feeder does not wish to opt for
continuous supply, all the consumers on such feeder will not be able to avail
continuous supply. Such Industrial consumers who opt for continuous supply shall be
exempted from load shedding during scheduled/unscheduled power cuts and during
restricted hours of the period of restriction in usage approved by the Commission from
time to time, except load shedding required due to emergency breakdown/shutdown.

(ii) Consumers who are existing Continuous Supply Consumers shall continue to remain
Continuous Supply Consumers and they need not apply again for seeking continuous
supply. Such consumers shall pay 10% extra energy charges, in addition to the energy
charges given above, w.e.f. April 01, 2018 till March 31, 2019. However, in case of any
pending dispute with UPCL in the matter of continuous supply on certain feeders,
those consumers will have to apply afresh, for availing the facility of continuous
supply, by April 30, 2018.
(iii) The new applicants for continuous supply of power (including those who are applying
afresh as per above) can apply for seeking the continuous supply option at any time
during the year. However, continuous supply surcharge for such consumers shall be
applicable with effect from May 1, 2018 till March 31, 2019. UPCL shall provide the
facility of continuous supply within 7 days from the date of application, subject to
fulfilment of Conditions of Supply.
(iv) In case of re-arrangement of supply through independent feeder, UPCL shall provide
the facility of continuous supply from the date of completion of work of independent
feeder subject to fulfilment of Conditions of Supply and the Continuous Supply
Surcharge on such consumers shall be applicable from the date of energisation of
aforesaid independent feeder till 31st March 2019, irrespective of actual period of
continuous supply option.
(v) In case of a new consumer (new connection) opting continuous supply, 10% extra
energy charges as Continuous Supply Surcharge shall be applicable from the date of
new connection till 31st March 2019, irrespective of the actual period of continuous
supply.
(vi) The existing consumers availing continuous supply option, who wish to discontinue
the continuous supply option granted to them earlier, will have to communicate, in
writing, to UPCL latest by April 30, 2018 and they shall continue to pay continuous
supply surcharge alongwith the tariff approved in this Order till April 30, 2018.
Further, in this regard, if due to withdrawal by one consumer from availing
continuous supply option on a particular feeder, supplying to other continuous supply
consumers as well, the status of other continuous supply consumers on that feeder is

8. Annexures
affected, then UPCL shall inform all the affected consumers in writing, well in
advance.
(vii) The Continuous Supply Surcharge shall not be applicable on the power procured by
the industrial consumers through open access.
(viii) UPCL shall not change the status of a continuous supply feeder to a non-continuous
supply feeder.
(ix) UPCL/PTCUL shall take up augmentation, maintenance and overhauling works on

top priority, specially in the sub-stations where circuit breakers, other equipment, etc.
are in dilapidated condition and, thereby, shall ensure minimisation of interruptions of
the continuous supply feeders.
(x) UPCL/PTCUL shall carry out periodical preventive maintenance of the feeders
supplying to continuous supply consumers. The licensees shall prepare preventive
maintenance schedule, in consultation with continuous supply consumers, well in
advance, so that such consumers can plan their operations accordingly.
(xi) The Licensee should show the energy charges and continuous supply surcharge
thereon separately in the bills.
7. Demand Charges for HT Industry
If the minimum average supply to any HT Industry Consumers is less than 18 hours per day
during the month, the Demand Charges applicable for such HT Industry Consumer shall be 80% of
the approved Demand Charges for HT Industry.

RTS 6: Mixed Load
1. Applicability
This schedule applies to single point bulk supply connection of more than 75 kW where the
supply is used predominantly for domestic purposes (with more than 60% domestic load) and also
for other non-domestic purposes. This schedule also applies to supply to MES.
2. Rate of Charge
The following rates shall apply to consumers of this category

Rs. 75/kW/month Rs. 4.80/kWh
3. Other conditions
Apart from the above, other conditions of tariff shall be same as those for RTS-1 consumers.
However, excess load penalty shall be applicable as per clause 12 of General Conditions of Supply.

8. Annexures
RTS 7: Railway Traction
1. Applicability
This schedule applies to Railways utilizing power for traction purposes.

2. Rate of Charge
The following rates of energy and demand charge shall apply to this category:
Demand Charges Energy Charges
Rs./kVA/month Rs./ kVAh
245/- Rs. 4.35
3. Other conditions
Apart from the above, other conditions of tariff shall be same as those for General HT
Industries under RTS-5 consumers except applicability of ToD tariff and surcharge for continuous
supply.

RTS-8: Temporary Supply
1. Applicability
(i) This schedule shall apply to temporary supplies of light, fan and power loads for all
purposes including illumination/public address/ceremonies and festivities/functions/
temporary shops not exceeding three months.
(ii) This schedule shall also apply for power taken for construction purposes including civil
work by all consumers including Government Departments. Power for construction
purposes for any work / project shall be considered from the date of taking first connection
for the construction work till completion of the work / project.
However, use of electricity through a permanent connection sanctioned for premises
owned by the consumer for construction, repair or renovation of existing building, shall
not be considered as unauthorised use of electricity as long as the intended purpose/use
of the building/apartments being constructed is same/permissible in the sanctioned
category of the connection.
2. Rate of Charge
The rate of charge will be corresponding rate of charge in appropriate Schedule Plus 25%.
The appropriate rate schedule for the temporary supplies for cane crusher upto 15 BHP given for
maximum period of four (4) months will be RTS-5.

8. Annexures
8.2 Annexure 2: Schedule of Miscellaneous Charges

Sl. Approved
Nature of Charges Unit
No (Rs.)
Checking and Testing of Meters
a. Single Phase Meters Per Meter 50.00
b. Three Phase Meters Per Meter 75.00
c. Recording Type Watt-hour Meters Per Meter 170.00
1 d. Maximum Demand Indicator/ LT CT operated Meters Per Meter 350.00
e. Tri-vector Meters/ HT Meters with CT/PT Per Meter 1000.00
f. Ammeters and Volt Meters Per Meter 65.00
g. Special Meters Per Meter 335.00
h. Initial Testing of Meters Per Meter NIL
2 Subsequent testing and installation other than initial testing Per Meter 80.00
Disconnection and Reconnection of supply on consumers
request or non-payment of bill (for any disconnection or
reconnection the charge will be 50%)
3
a. Consumer having load above 100 BHP/75 kW Per Job 600.00
b. Industrial and Non Domestic consumers upto 100 BHP/75 kW Per Job 400.00
c. All other categories of consumers Per Job 200.00
Replacement of Meters
a. Installation of Meter and its subsequent removal in case of
Per Job 75.00
4 Temporary Connections
b. Changing of position of Meter Board at the consumer's
Per Job 100.00
request
Checking of Capacitors (other than initial checking) on
consumer's request:
5
a. At 400 V/ 230 V Per Job 150.00
b. At 11 kV and above Per Job 300.00

8.3 Annexure 3: Public Notice

8. Annexures

8.4 Annexure 4: List of Respondents

Sl.
Name Designation Organization Address
No.
Sandhu Farms, Fazalpur Mehrola,
Managing M/s Tarai Farm Lands
1. Sh. G.S. Sandhu Rudrapur-263153, Distt. Udham
Director Pvt. Ltd.
Singh Nagar
Opposite Panwar General Store,
Near Shiv Mandir, Saket
2. Sh. Amit Joshi - -
Colony, Ajabpur Kalan, Dehradun-
248121, Uttarakhand
Haridwar Unit-II, Plot No. 1 B,
General M/s Vista Alps
3. Sh. Man Singh Sector-10, Integrated Industrial
Manager (Engg.) Industries Ltd.
Estate, SIDCUL, Distt. Haridwar
A-1, Industrial Area, Bazpur Road,
Vice President
4. Sh. R.S. Yadav M/s India Glycols Ltd. Kashipur-244713, Distt. Udham
(HR & Admn.)
Singh Nagar
Plant
Plot No. 3, Sector-10, IIE, SIDCUL,
5. Sh. Haridwar Singh Maintenance M/s Hero MotoCorp Ltd.
Roshanabad, Haridwar-249403
Head
Narain Nagar Industrial Estate,
M/s Galwalia Ispat
6. Sh. Pankaj Singh Bora - Bazpur Road, Kashipur-244713,
Udyog Pvt. Ltd.
Distt. Udham Singh Nagar
M/s Uttarakhand Steel
C/o Shree Sidhbali Industries Ltd.,
7. Sh. Pawan Agarwal Vice-President Manufacturers
Kandi Road, Kotdwar, Uttarakhand
Association
A-24/10, Mohan Co-operative
Manager M/s Air Liquide North
8. Sh. Jatinder Kumar Industrial Estate, Mathura Road,
(Energy) India Pvt. Ltd.
New Delhi-110044
Vice President
Unit No. 3, 4, 5 and 6, Fourth Floor,
(Regulatory M/s Indian Energy
9. Ms. Shruti Bhatia TDI Centre, Plot No - 7, Jasola,
Affairs and Exchange Ltd.
New Delhi–110025
Communication)
A-12, Prakash Residency, Stadium
10. Smt. Rashmi Agrawal - - Road, P.O. Kashipur-244713, Distt.
Udham Singh Nagar, Uttarakhand
Integrated Glass Plant, Village-
M/s Asahi India Glass Latherdeva Hoon, Manglaur-
11. Sh. Munish Talwar -
Ltd. Jhabrera Road, P.O. Jhabrera, Tehsil
Roorkee, Distt. Haridwar
Sr. General 5th KM, Stone, Ramnagar Road,
Sh. Shakeel A. M/s Kashi Vishwanath
12. Manager Kashipur-244713, Distt. Udham
Siddiqui Textile Mill (P) Ltd.
(Commercial) Singh Nagar
M/s Industries
Mohabewala Industrial Area,
13. Sh. Pankaj Gupta President Association of
Dehradun-248110
Uttarakhand
A-24/E, DDA Flats, Munirka, New
14. Dr. V.K. Garg - -
Delhi-110067

8. Annexures
Sl.
No.
Chief Electrical
Sh. Sudhanshu Headquarters Office, Baroda
15. Distribution Northern Railway
Krishna Dubey House, New Delhi-110001
Engineer
M/s Kumaon Garhwal Chamber House, Industrial Estate,
16. Sh. Vikas Jindal President Chamber of Commerce & Bazpur Road, Kashipur,
Industry Uttarakhand Udhamsingh Nagar
Plot No. 1, Sector 11, Integrated
Head (CPED & Industrial Estate, SIDCUL,
17. Sh. R.K. Singh M/s Tata Motors Ltd.
E) Pantnagar-263153, Udhamsingh
Nagar
Plot No. 41, Sector 3, IIE,
M/s Ambashakti Glass
18. Sh. Sanjay Adlakha Director Pantnagar, Rudrapur-263153,
India Pvt. Ltd.
Udhamsingh Nagar
Plot 9, Sector 9, IIE, SIDCUL,
M/s BST Textile Mills
19. - - Pantnagar, Rudrapur-263153,
Pvt. Ltd.
Udham Singh Nagar
Plot No. C-34 & C-34(a) to (d), C-
Sr. Vice M/s Balaji Action 6(a), C-6(b) & C-3, Eldeco Sidcul
20. Sh. V.K. Aggarwal
President Buildwell Industrial Park, Sitarganj-262405,
Udham Singh Nagar
Vill.-Gopipura, Post-R.T.C.
Sh. Pramod Singh M/s PSR Innovations
21. Partner Hempur, Kashipur-244716, Udham
Tomar LLP
Singh Nagar
S/o Sh. Chamanlal, Vill.-
Sh. Vinay Kumar
22. - - Jwaharkhan (Jhivarhedi), P.O.-
Saini
Sultanur Kunhari, Distt. Haridwar
M/s Progressive Dairy
Dr. Harendra Singh S-1, D-6, Defence Colony,
23. President Farmers Association
Rawat Dehradun
Uttarakhand
Office-33, Katoratal, Kashipur,
24. Sh. Teeka Singh Saini Block President Bhartiya Kisan Union
Distt. Udhamsingh Nagar
Gandhi Chowk, Mussoori-248179,
25. Sh. Ram Kumar Goel - Hotel Vishnu Palace
Dehradun
Sh. Vijay Kumar M/s Shiv Shakti Sarrafa Bazaar, Kankhal, Distt.
26. -
Verma Electricals Haridwar, Uttarakhand
K-1 & K-2, AIS Industrial Estate,
Village-Latherdeva Hoon,
27. - Plant Head M/s Finolex Cables Ltd. Manglour, Jhabrera Road, P.O.
Jhabrera, Tehsil-Roorkee, Distt.
Haridwar
Lal Tappar Industrial Area, P.O.
DGM (Finance &
28. Sh. Naval Duseja M/s Flex Foods Ltd. Resham Majri, Haridwar Road,
Accounts)
Dehradun-248140
M/s Nehru Colony
Sh. Shivnarayan General
29. Residents Welfare I-22, Nehru Colony, Dehradun
Baluni Secretary
Society
146/1, Rajendra Nagar, Street No.
30. Sh. G.D. Madhok - -
9, Kaulagarh Road, Dehradun

Sl.
No.
Village-Delna, P.O. Jhabrera-
31. Sh. Katar Singh President Kisan Club
247667, Haridwar
Shetra Mai Jeevni Ram Sukhdevi
32. Sh. Ashok Goswami - - Ram Trust, Haridwar Road,
Rishikesh, Dehradun
M/s Uttarakhand
State General Off. G-31, UPSIDC, Industrial Area,
33. Sh. Mahesh Sharma Industrial Welfare
Secretary Selaqui, Dehradun, Uttarakhand.
Association
(Northern Region), Uttarakhand
Confederation of Indian State Office, 30 (58/1), Rajpur Road
34. Dr. Vijay Dhasmana Chairman
Industry (Near Crossroads Mall), Dehradun-
248001
Sh. Sunil Kumar 16, Chakrata Road (Tiptop Gali),
35. Editor Teesri Aankh ka Tehalka
Gupta Dehradun-248001
General UPSIDC Industrial Area, Khatima-
36. Sh. H.P. Mishra M/s Khatema Fibres Ltd.
Manager 262308, Udhamsingh Nagar
57/2, Site-IV Industrial Area,
Executive
37. Sh. P.K. Rajput M/s Alps Industries Ltd. Sahibabad, Ghaziabad-201010,
Director
Uttar Pradesh
Village-Delna, P.O. Jhabrera-
247667, Haridwar
Lane No. 11, Chaman Vihar, P.O.
39. Sh. Sudhir Goyal - -
Majra, Dehradun.
K-3, AIS Industrial Estate,
M/s Carborundum
40. Sh. Anuj Garg Plant Head Latherdeva Hoon, P.O. Jhabrera,
Universal Ltd.
Roorkee-247667, Distt. Haridwar.
D1, D2, 27-Civil Lines, Rudrapur,
41. Sh. H.D. Arora - -
Distt. Udham Singh Nagar.

8. Annexures
8.5 Annexure 5: List of Participants in Public Hearings

List of Participants in Hearing at Bageshwar on 20.02.2018
Sl.
No.
Danu Niwas, Village-Mandal Sera,
Sh. Deewan Singh Daanpur Sewa
1. Chairman Near Peepal Chowk, Distt. Bageshwar-
Danu Samiti
263642
Village-Mandal Sera, Jeetnagar, Near
Daanpur Sewa
2. Heera Singh Takuli Secretary Peepal Chowk, Distt. Bageshwar-
Samiti
263642
Chetra Panchayat, Village &Post-Jakhadi, Distt.
3. Sh. Joga Singh Mehta Member
Jakhadi Bageshwar-263640
Sh. Hoshiyar Singh Village-Lamjhigara, Post-Mahroori,
4. - -
Mehra Tehsil-Kanda, Distt. Bageshwar
Mandalsera, Near Peepal Chowk,
5. - Convenor Jan Kalyan Samiti
Distt. Bageshwar
Sh. Pratap Singh Maziakhet, Tehsil Road, P.O.-
6. - -
Garia Bageshwar, Distt. Bageshwar

List of Participants in Hearing at Rudrapur on 21.02.2018

Sl.
No.
A-1, Industrial Area, Bazpur Road,
Vice President M/s India Glycols
1. Sh. R.S. Yadav Kashipur-244713, Distt. Udham Singh
(HR & Admn.) Ltd.
Nagar.
M/s ACME Plot 3-8, 29-34, Sector-5, Integrated
Sh. B.S.
2. - Cleantech Solutions Industrial Estate Sidcul, Rudrapur, Distt.
Sehrawat
Ltd. Udham Singh Nagar.
Sr. General M/s Kashi
Sh. Shakeel A. 5th KM Stone, Ramnagar Road, Kashipur-
3. Manager Vishwanath Textile
Siddiqui 244713, Distt. Udham Singh Nagar.
(Commercial) Mill (P) Ltd.
Narain Nagar Industrial Estate, Bazpur
M/s Galwalia Ispat
4. Sh. Pankaj Bora - Road, Kashipur-244713, Distt. Udham Singh
Udyog Ltd.
Nagar.
M/s Kashi
Sh. Pradeep 5th KM Stone, Ramnagar Road, Kashipur-
5. - Vishwanath Textile
Semwal 244713, Distt. Udham Singh Nagar.
Mill (P) Ltd.
M/s BST Textile Plot 9, Sector 9, IIE, SIDCUL, Pantnagar,
6. Sh. S.K. Garg -
Mills Pvt. Ltd. Distt. Udham Singh Nagar
M/s BST Textile Plot 9, Sector 9, IIE, SIDCUL, Pantnagar,
7. Sh. P.K. Mishra -
Mills Pvt. Ltd. Distt. Udham Singh Nagar
M/s Perfect
Sh. Sanjay Sector 9, Sidcul, Rudrapur, Distt. Udham
8. - Dynamics Auto Pvt.
Kumar Singh Nagar
Ltd.
Sh. Jagdish Village-Dharampur, P.O. Chattarpur, Distt.
9. - -
Singh Udham Singh Nagar
Plot No. 19, Sector-9, IIE
M/s Roop Polymers
10. Sh. Akash Jain - SIDCUL, Pantnagar, Distt. Udham Singh
Ltd.
Nagar
Managing Sandhu Farms, P.O. Box No. 18, Rudrapur-
11. Sh. G.S. Sandhu M/s Tarai Foods Ltd.
Director 263153, Distt. Udham Singh Nagar.
Executive Sandhu Farms, P.O. Box No. 18, Rudrapur-
12. Sh. R.P. Singh M/s Tarai Foods Ltd.
Director 263153, Distt. Udham Singh Nagar.
Sh. Gurdayal Village-Dharampur, P.O. Chattarpur, Distt.
13. - -
Village Fulsunga, Post Off.-Transit Camp,
14. Sh. A.K. Singh - -
Rudrapur-263153, Distt. Udhamsingh Nagar.
Sh. Prem Village & P.O. Chattarpur, Rudrapur, Distt.
15. - -
Maurya Udham Singh Nagar-263153
Sh. Harendra Fauji Matkota, Bhurarani, Rudrapur, Distt.
16. - -
Sh. Kunwar Pal Fauji Matkota, Bhurarani, Rudrapur, Distt.
17. - -
Sh. Deepak Pantnagar, SIDCUL Industrial Area Road,
18. - M/s Nestle India Ltd.
Kumar Distt. Udham Singh Nagar-263153
Plot No. 2-5, Sector-8, IIE, Pantnagar
Sh. Umesh
19. - M/s Voltas Ltd. Industrial Area, Rudrapur, Distt.
Sharma
Udhamsingh Nagar-263153
20. Sh. Sukha Singh - - Village & P.O. Chattarpur, Distt. Udham
8. Annexures
Sl.
No.
Singh Nagar
Sh. Harpal Village & P.O. Chattarpur, Distt. Udham
21. - -
Singh Singh Nagar
Sh. Rohit Village-Beria Daulat, Bazpur, Distt.
22. - -
Chopra Udhamsingh Nagar
Sh. Bhaskar M/s Titan Company Sector-2, Plot No. 10 A, Sidcul, Pantnagar,
23. -
Joshi Ltd. Rudrapur-263154, Distt. Udhamsingh Nagar
Sh. Sanjay M/s Ambashakti Plot. No. 41, Sector-3, SIDCUL, Pantnagar,
24. -
Adlakha Glass India Pvt. Ltd. Distt. Udham Singh Nagar
Sh. Rajendra Village-Alakhdeva, P.O.-Premnagar, Tehsil-
25. Block President Bhartiya Kisan Union
Singh Makkar Gadarpur, Distt. Udham Singh Nagar
Sh. Lakhvinder Village-Beria Daulat, Bazpur, Distt. Udham
26. - -
Singh Mehta Singh Nagar
Plot No.-196A, Phase-I, Eldeco Sidcul
Col. Jitender M/s SETCO
27. - Industrial Park, Village Lalarpatti, Sitarganj,
Pal Automotive Ltd.
Distt. Udham Singh Nagar
Village-Dakiya Kalan, Post Off.-Dakiya No.-
Sh. Kuldeep
28. - Bhartiya Kisan Union I, Tehsil-Kashipur, Distt. Udhamsingh
Singh
Nagar-244713
Former State
Sh. Teeka Singh 33, Katoratal, Kashipur, Distt. Udham Singh
29. General Kisan Congress
Saini Nagar
Secretary
Sr. General M/s Radico Khaitan A-1, A-2, B-3, Industrial Area, Bazpur, Distt.
30. Sh. R.B. Biradar
Manager Ltd. Udham Singh Nagar
Sh.
M/s Parle Biscuits Plot No. D-10, Eldeco Sidcul Industrial Area,
31. Parmeshwar -
Pvt. Ltd. Sitarganj-262405, Distt. Udham Singh Nagar
Sharma
Sh. R.K. M/s Mantri Metallics Plot No. 31, Sector-11, Sidcul, Pantnagar,
32. -
Maheshwari Ltd. Distt. Udham Singh Nagar
M/s Sidcul
Sh. Rajesh Plot No. 1, Sector-9, IIE, SIDCUL Pantnagar,
33. - Entrepreneur Welfare
Kumar Mishra Distt. Udham Singh Nagar
Society
Sh. Harbhajan Bajar Patti, Gadarpur, Distt. Udham Singh
34. - -
Singh Nagar
Sh. Shyam
Roshanpur, Totawala, P.O. Gularbhoj, Distt.
35. Chandra - -
Udham Singh Nagar
Kamboj
Sh. Ashok Mahaveer Nagar, Dr. Adarsh Nagar,
36. - -
Kumar Gadarpur, Distt. Udham Singh Nagar
Sh. Tushar M/s BTC Industries Village-Kishanpur, P.O. Deooria, Tehsil-
37. -
Agarwal Ltd. Kichha, Distt. Udhamsingh Nagar

List of Participants in Hearing at Rudraprayag on 27.02.2018

Sl.
No.
Village & Post-Nakot, Nagar
Sh. Harshwardhan Former
1. - Panchayat-Augustmuni, Distt.
Benjwal Sarpanch
Rudraprayag
Village & Post-Nakot, Nagar
2. Sh. Balbeer Lal Former Pradhan - Panchayat-Augustmuni, Distt.
Rudraprayag

8. Annexures
List of Participants in Hearing at Dehradun on 28.02.2018
Sl. Name Designation Organization Address

No.
Plot No. 1, Sector 11, Integrated
M/s Tata Motors Industrial Estate, SIDCUL,
1. Sh. Devesh Pant -
Ltd. Pantnagar-263153, Distt. Udham
Singh Nagar
M/s Industries C/o Satya Industries,
2. Sh. Pankaj Gupta President Association of Mohabbewala Industrial Area,
Uttarakhand Dehradun
M/s Industries C/o Satya Industries,
Sr. Vice-
3. Sh. Rajiv Agarwal Association of Mohabbewala Industrial Area,
President
Uttarakhand Dehradun
Village-Sultanpur Sabatwali, P.O.
Jhabrera-247667, Haridwar
Village-Delna, P.O. Jhabrera,
5. Sh. Vijay Singh Verma Secretary Kisan Club
Haridwar-247665, Uttarakhand
Integrated Glass Plant, Village-
M/s Asahi India Latherdeva Hoon, Manglaur-
6. Sh. Munish Talwar -
Glass Ltd. Jhabrera Road, P.O. Jhabrera,
Tehsil Roorkee, Haridwar
Tarun Kranti
7. Sh. Arvind Jain Member 6-Ramleela Bazaar, Dehradun
Manch (Regd.)
Sh. Gulshan Rai Sh. Ganesh Roller Mohabbewala Industrial Area,
8. -
Khanduja Floor Mills Subhash Nagar, Dehradun-248001
M/s Prantiya
Electrical 4(4/3), New Road, Near Hotel
General
9. Sh. K.L. Sundriyal Contractors Relax, (Amrit Kauri Road),
Secretary
Association, Dehradun
Uttarakhand
Lal Tappar Industrial Area, P.O.
DGM (Finance M/s Flex Foods
10. Sh. Naval Duseja Resham Majri, Haridwar Road,
& Accounts) Ltd.
Dehradun-248140
M/s Instruments 30, Mohabbewala Industrial
11. Sh. S.C. Mittal Director
& System Area, Dehradun-248002
Plot No. 1 B, Sector-10, Integrated
Executive M/s Vista Alps
12. Sh. P.K. Rajput Industrial Estate, SIDCUL, Distt.
Director Industries Ltd.
Haridwar
Sh. Chandra Mohan M/s Manoj Floor Near Sahastradhara Bus Stand,
13. -
Goyal Mill Sahastradhara, Dehradun
Teesri Aankh ka 16, Chakrata Road (Tiptop Gali),
14. Sh. Sunil Gupta Editor
Tehalka Dehradun-248001
Plot No. 1A, Sector-10, Integrated
General
M/s Alps Industrial Estate, SIDCUL,
15. Sh. Man Singh Manager
Industries Ltd. Roshnabad Road, Distt.
(Engg.)
Haridwar-249403
M/s Shiv Shakti Sarrafa Bazaar, Kankhal, Distt.
16. Sh. Vijay Verma -
Electricals Haridwar, Uttarakhand

Sl. Name Designation Organization Address

No.
Mohanpur, Post Off.-Premnagar,
17. Sh. Viru Bisht -
Dehradun-248007
146/1, Rajendra Nagar, Street
18. Sh. G.D. Madhok - - No. 9, Kaulagarh Road,
Dehradun
Village-Harbanswala, Near
19. Sh. Subodh Kumar - -
Seemadwar, Dehradun
M/s Progressive
Dairy Farmers S-1, D-6, Defence Colony,
20. Dr. H.S. Rawat President
Association Dehradun.
Uttarakhand
Tarun Kranti
21. Sh. Arvind Jain Member 6-Ramleela Bazaar, Dehradun
Manch (Regd.)
Parvatiya G-3, Janpad Shopping Complex,
22. Sh. Kamaldeep Kamboj -
Saaptahik Chakrata Road, Dehradun
23. Sh. Parshuram - - Jagjeetpur, Haridwar
Chaman Vihar, Phase-II, ITBP
24. Ms. Rubi Goyal - -
Road, Dehradun
Lane No. 11, Chaman Vihar, P.O.
25. Sh. Sudhir Goyal - -
Majra, Dehradun.
153, 2nd Block, Dharampur,
26. Sh. Surya Prakash - -
Dehradun
Lane No. 11, Chaman Vihar, Near
27. Sh. S.K. Yadav - -
Niranjanpur, Dehradun
Sohta House, Lane No. 11,
28. Sh. Deshraj - - Chaman Vihar, Near Niranjanpur,
Dehradun

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True up for FY 2016-17,

UTTARAKHAND ELECTRICITY REGULATORY COMMISSION

1. Background and Procedural History..................................................................................................4

UTTARAKHAND ELECTRICITY REGULATORY COMMISSION

Petition No. 49 of 2017

In the Matter of:

In the Matter of:

Uttarakhand Power Corporation Limited

Shri Subhash Kumar Chairman

Date of Order: March 21, 2018

Uttarakhand Electricity Regulatory Commission 1

The Petition filed by UPCL had certain infirmities/deficiencies. The Commission,

2 Uttarakhand Electricity Regulatory Commission

Uttarakhand Electricity Regulatory Commission 3

Uttarakhand Electricity Regulatory Commission 4

Table 1.1: Publication of Notice

Table 1.2: Schedule of Hearing

Uttarakhand Electricity Regulatory Commission 5

The objections/suggestions/comments, as received from the stakeholders through

 Details of Bad Debts written off by it.

 Category-wise revenue billed during FY 2016-17

 Actual sales data for FY 2017-18 till September, 2017.

 Actual number of new employees employed, employees promoted and employees

 Rationale and necessary government approval behind adjustment of Government

 Category wise load shedding data for FY 2016-17 and FY 2017-18.

 Existing and proposed category wise cross subsidy.

6 Uttarakhand Electricity Regulatory Commission

 Actual interest on Consumer Security Deposit paid to consumers/adjusted in

 Basis of considering expected COD for new generating stations.

 MTB’s till September 2017.

Uttarakhand Electricity Regulatory Commission 7

2.1.1.1 Stakeholder’s Comments

Uttarakhand Electricity Regulatory Commission 8

2.1.1.2 Petitioner’s Reply

2.1.1.3 Commission’s Views

2.2 Overall Tariff Increase

2.2.1.1 Stakeholder’s Comments

Uttarakhand Electricity Regulatory Commission 9

2.2.1.2 Petitioner’s Reply

2.2.1.3 Commission’s Views

2.3 Domestic Tariff

2.3.1.1 Stakeholder’s Comments

2.3.1.2 Petitioner’s Reply

Uttarakhand Electricity Regulatory Commission 11

2.3.1.3 Commission’s Views

2.4 Non-Domestic Tariff

2.4.1 Tariff Hike

2.4.1.1 Stakeholder’s Comments

2.4.1.2 Petitioner’s Reply

The Petitioner in response submitted that UPCL is a commercial organization and is

12 Uttarakhand Electricity Regulatory Commission

2.4.1.3 Commission’s Views

2.5 Agricultural Tariff

2.5.1.1 Stakeholder’s Comments

Uttarakhand Electricity Regulatory Commission 13

2.5.1.2 Petitioner’s Reply

2.5.1.3 Commission’s Views

14 Uttarakhand Electricity Regulatory Commission

2.6 Agriculture Allied Activities

2.6.1.1 Stakeholder’s Comments

2.6.1.2 Petitioner’s Reply

Uttarakhand Electricity Regulatory Commission 15