Power reforms to be part of tariff determination

...If a discom has a proposal for substantial network upgrade... then it would be considered by the

DERC for funding and later, shall also form the basis of tariff determination.

As Delhi is catching up with the concept of Smart Grid system, which would make the city’s electricity infrastructure go online, the Delhi Electricity Regulatory Commission (DERC) for the first time has introduced a special provision for financing and planning big ticket projects in its tariff determination norms.

In its ‘Terms and Conditions for determination of Tariff Regulations, 2016’, released on Tuesday, the power regulator has allowed distribution companies to come up with detailed project reports on ‘Renovation and Modernisation for Life Extension’.

“This means that if a discom has a proposal for substantial network upgrade like making all overhead cables underground, then it would be considered by the DERC for funding and later, shall also form the basis of tariff determination,” a DERC official said.

Till now, Delhi has no regulation for major projects and only routine upgradation works are accounted for. “Projects like redevelopment of Chandni Chowk where all overhead cables are to be made underground needed certain guidelines. Now there will be a framework that would include scope, justification, cost-benefit analysis, estimated life extension from a reference date, financial package, among others of the project,” said a Tata Power Delhi Distribution Limited official.

The power regulator has sought suggestions from public on this and a final notification is likely in February 2017, based on which power tariffs would be revised. Delhiites have been saved from tariff hikes for two consecutive years.

Installing a Smart Grid network would now fall under this category which may help expedite projects.

TPDDL has undertaken a Smart Grid project in Shalimar Bagh, which is estimated to cost ₹293 crore.

“The scope of work for the Smart Grid network includes shifting the fault-prone overhead network into an underground line which is estimated at ₹40 crore. Thenalow-voltagenetworkhasto be put in place which will cost about ₹80 crore and the balance of the ₹173 crore will be used for installing smart metres in the houses that come pilot project area — Zone 503 in Shalimar Bagh,” the TPDDL official said.

Delhi’s power infrastructure is suffering for want of an upgrade.