BEST’s replies to the Preliminary Data Gaps (Set-I) of ... to Pre TVS Data Gaps... · EST’s...

BEST’s reply to the Pre-TVS data gap queries (Set-1)

BEST’s replies to the Preliminary Data Gaps (Set-I) of Petition of BEST for Third MYT

Control Period for approval of ARR and determination of Tariff for FY 2016-17 to FY 2019-20

under MERC (MYT) Regulations, 2015 along with Final Truing up of FY 2012-13 to FY 2014-

15 and Provisional Truing up of FY 2015-16 under MERC (MYT) Regulations, 2011.

[Case No. 33 of 2016]

A. Common Issues and Executive Summary

Query 1

BEST should incorporate the impact of any changes that are required on account of these data gaps and

replies at the appropriate places in the Petition in all sections and submit the revised Petition including

Executive Summary accordingly.

Reply 1

BEST submits that, it will incorporate the impact of changes with respect to the data gaps in its Revised

MYT Petition along with the Executive Summary in due course.

Query 2

BEST, in its MYT Petition for the second Control Period, had proposed to reduce transport deficit to zero

by the end of FY 2015-16. However, BEST has proposed multi-fold increase in the transport deficit in the

present Petition. In this regard,

a. BEST should justify its claim of transport deficit wherein BEST itself had proposed to reduce it to

zero by the end of FY 2015-16.

b. BEST should submit reasons why it has not been able to control the transport deficit.

c. In what new time-frame does BEST envisage that the transport division will become self-sustaining

and the transport losses shall not be passed on to the electricity business?

Reply 2

BEST submits that every avenue is being explored and every attempt is being made by BEST to ensure

self-sufficiency of its Transport Business. In this regard, BEST has introduced various measures to

improve the efficiency of operations and maintenance of its Transport Business as mentioned below and

submitted in 1.3.19 of the petition.

BEST has increased the bus fares of its Transport Business to generate additional revenue.

BEST is also trying to generate additional revenue for its Transport Business through the mode

of advertising on, as well as licensing /renting out of the assets of its Transport Business.


Furthermore, the statutory BEST Committee by Resolution No. 38 dated 15 May, 2015, has

proposed and resolved to introduce a levy and recovery of “Transport Cess”, on property tax

levied under the Mumbai Municipal Corporation Act, 1888. The said matter has been forwarded

to MCGM and thereafter will be forwarded to the Government of Maharashtra for making

consequential amendment in the Mumbai Municipal Corporation Act, 1888, for such levy and

recovery of “Transport Cess”. The matter of such levy and recovery of “Transport Cess”, is now

pending before MCGM for further necessary action.

It is humbly submitted by BEST that all these acts and deeds by or on behalf of BEST have been

undertaken to progressively reduce and subsequently to do away with the burden of TDLR charges

from the electricity consumers of BEST. However, the expenses has also increased and revenue has

decreased over the last few years on several account as highlighted below

The Data submitted in Business Plan and Expenditure incurred and Revenue earned by BEST is as

follows -

(Amt-Cr Rs)

Total Summary for the period - FY2012-13, FY2013-14 & FY2014-15

Particulars Business Plan Actual Diff.

Establishment Cost 3587.01 4163.45 576.44

Fuel Cost 1201.31 1332.76 131.45

Depreciation 172.19 130.96 (- ) 41.23

Property Ins. Fund 18.33 8.93 (-) 9.40

Other Cost 558.43 593.83 35.40

Interest Charges 447.19 384.97 (-) 62.22

Total Cost 5984.46 6614.90 630.44

Total Revenue 4784.42 4355.65 (-) 428.77

Total Deficit (-) 1200.04 (-) 2259.25 (-) 1059.21

The total “Deficit” for FY 2012-13, FY 2013-14 & FY 2014-15 was estimated to be Rs.1200.04 Crore in

Business Plan, as against this the actual deficit has been Rs.2259.25 Crore. That shows there is

additional deficit of Rs.1059.21 Crore. The reasons for this additional deficit are mentioned below -

1. Hike in Expenditure by Rs. 630.44 Crore -

As per the Business Plan, the total Expenditures estimated for the three years was Rs.5984.46

Crore. However, actual expenditure incurred in this period is Rs.6614.90 Crore, hence an

additional expenditure of Rs.630.44 Crore was incurred.


Out of this Rs.630.44 Crore, major portion of Rs.576.44 Crore is incurred on Establishment Cost.

The main reason for higher expenses on Establishment Cost is increase in D.A. Index. In the

beginning of the year 2012-13 the D.A. Index was 23550 points, which is flared to 31804 points

at the end of the year 2014-15. This shows hike of 8254 points which is 35% over the base year.

Year Establishment Cost in Rs. Crores

Cost of living Index

Valuable DA for Basic Minimum Grads in Rs.

Transport Department Nos. of Staff

2011-12 922.57 23439 3428.29 36028

2012-13 1196.67 26369 4535.61 36796

2013-14 1385.00 28736 5429.96 36610

2014-15 1629.38 31804 6589.36 35483

Further, from the year 2014-15 onwards the Undertaking had to release the payments on

account of “arears of Wage agreement”, which also resulted in severe increase in

Establishment Cost.

On the part of administration, efforts were made to control the Establishment Cost by

restricting the Staff strength by restructuring the duty schedules with the help of computerized

scheduling system. This has helped in reducing staff strength as shown in table above.

Another reason for increase in the total expenditures is hike in Fuel Cost. At the beginning of the

year 2012-13 the Fuel rates were Rs.44.43 (for Diesel) and Rs. 32.40 (for CNG). These rates were

hiked to Rs.55.72 & Rs.42.75 respectively. This hike in Fuel rates caused additional expenditure

on Fuel by Rs.131.45 Crore.

Another expense head which has increased, is Other Cost, which includes Material, Taxes,

Registration and Misc Expenses. This cost has increased by Rs. 35.40 Crore, in comparison with

Business Plan figures.

The Expenses on ‘Interest Charges’ which were mounting high for previous years, are reduced

by 13.91% in comparison with Business Plan Figures. The main reason for this change is Rs.150/-

Crore Grant received from MCGM in the year 2014-15.

2. Reduction in Revenue by Rs. 428.77 Crore –

The expected Revenue for this period was Rs.4784.42 Crore. However, BEST could achieve

Rs.4355.65 Crore of revenue during the period. Hence, there is a shortfall of Rs.428.77 Crore.

There are multiple reasons for this drop in revenue. One of the reasons is curtailment in fleet.

The fleet is reduced by 271 buses in this period. It affected adversely on Bus operation.


With less number of buses available for operation as also with increasing traffic congestion in

the city, the bus operation has shown reduction of 55,521 kms daily as compared to Business

Plan figures. As such, the seat kms have reduced due to this, which has ultimately resulted in

drop in revenue.

Further, there has been drop in Nos. of passengers due to back to back ‘Fare Hike’. In this

period the fares were revised on 27th April 2012 (2012-13), 1st April 2013 (2013-14) & 1st

February 2015 (2014-15). These back-to-back fare hikes has negative impact on commuters and

they have shifted towards other options such as Share-Taxi and Auto in this period.

Another reason for drop in passengers is massive increase in no. of personal vehicles i.e. Two

Wheelers, Cars, School buses, Private buses, etc.

Justification for the demand in 3rd Control Period-

As stated above the Undertaking has incurred additional expenditure and could not earn the

Revenue as expected in Business Plan. Resultantly, it could not able to reduce transport deficit

to zero as proposed in Business Plan earlier.

Since, D.A. Index, Fuel Prices, Rent and Taxes are beyond the control of BEST administration, it

will take further time to self-sustain the Undertaking’s financial position.

Hence, the Transport Division requests further assistance from the Supply Division of the

Undertaking upto FY 2019-20.

Query 3

BEST should justify its proposal for sharing of transport deficit amongst the other distribution licensees

in Mumbai with reference to the relevant provisions of the Electricity Act, 2003 and MERC MYT

Regulations, 2015

Reply 3

BEST submits that, Section 51 of the Electricity Act 2003 provides for the following

“A distribution licensee may, with prior intimation to the Appropriate Commission, engage in any

other business for optimum utilization of its assets:

Provided that a proportion of the revenues derived from such business shall, as may be specified by

the concerned State Commission, be utilized for reducing its charges for wheeling:


Provided further that the distribution licensee shall maintain separate accounts for each such

business undertaking to ensure that distribution business neither subsidises in any way such business

undertaking nor encumbers its distribution assets in any way to support such business.

Provided also that nothing contained in this section shall apply to a local authority engaged,

before the commencement of this Act, in the business of distribution of electricity.”

As seen from the above extract it is clear that Distribution Licensee is not supposed to subsidize its

business through its other business unless it’s a local authority like BEST. Based on the above provision,

BEST has been claiming transport deficit which comes under its other business from the consumers of

BEST area.

However in the recent petition, BEST has proposed that the transport deficit shall be recovered from all

distribution licenses of Mumbai area as the transport facility of BEST is being used by all consumers of

Mumbai area. BEST has made such a proposal keeping in mind the rational for sharing of transport

deficit cost between utilities so that there would not be any unfair burden on the consumers of BEST.

Further, if the TDLR charges are shared with all consumers of the distribution licensees operating in

Mumbai, it will reduce the requirement for increase in TDLR charges for BEST as shown above. This is

also in line with the principle adopted for allowing competition, as the competition should be based on

fare sharing of cost between utilities.

Query 4

As regards the 'draft calculation' of projected TDLR if TDLR is levied on all consumers of the Mumbai

DISCOMs, BEST should:

a. Submit the calculations in MS Excel

b. Explanation for the calculation

c. Submit all assumptions and basis for such assumptions, viz., projected sales of other DISCOMs,

calculation of revenue from levy of TDLR for different DISCOMs, etc.

d. Clarify whether the Standalone Transport Deficit (first row in table) is being considered as Rs.

3682.79 crore in FY 2016-17 increasing to Rs. 4189.26 crore in FY 2019-20

e. Verify the calculations once again, as the revenue from TDLR from RInfra-D and TPC-D appear to

have been interchanged, and the calculation of revenue from TDLR appear to be incorrect

Reply 4

BEST provides for point wise reply as follows

a. BEST has already submitted the revised calculations sheet on 18th February 2016. BEST is again

attaching the detailed calculations in MS excel as Annexure-Q4.

b. BEST has taken standalone transport business deficit for each year of control period and added

previous transport deficit to be recovered in phased manner along with the carrying cost. BEST has


therefore arrived at total transport recovery for the respective years. After that it has considered

sales for Rinfra-D, TPC-D and BEST and applied at a flat TDLR rate of Rs. 1.16 per unit to arrive at

estimated revenues from each of the distribution Company. The rate of Rs. 1.16 is derived in such a

way that the balance recovery of transport deficit at the end of the Third MYT Control period will be

zero.

c. It is submitted that the sales projection for TPC-D and RInfra-D is derived by escalating approved

sales of FY 2015-16 with an increase over approved sales of FY 2014-15 in the respective MTR order

and the same escalation rate has been taken for rest of the control period.

d. Inadvertently few figures mentioned at table at section 1.3.21 were incorrect. The revised corrected

calculation with necessary changes of standalone deficit of transport has been submitted on 18th

February 2016. BEST is again attaching the detailed calculation in MS excel as Annexure-Q4.

Query 5

BEST has submitted the separate ARR for Distribution Wires and Retail Supply Business in the Formats.

In this regard,

a. BEST should clarify the basis for allocation of expenses between Distribution Wires and Retail Supply

Business

b. BEST should submit the separate ARR for the Wires Business and Retail Supply Business for each

Year of the third Control Period, in accordance with the MERC MYT Regulations, 2015, as part of its

main Petition and Executive Summary also.

BEST should propose separate Wheeling Charges and Retail Supply Tariff for each Year of the third

Control Period, in accordance with the MERC MYT Regulations, 2015 and Data Formats prescribed by

the Commission

Reply 5

BEST submits that, it has considered basis for allocation of expenses between Distribution Wires and

Retail Supply Business as per the Allocation matrix provided in Regulation 68 of MYT Regulations, 2015.

The Regulation 68 of the MERC MYT Regulations, 2015 specifies the following

“Every Distribution Licensee shall maintain separate accounting records for the Distribution

Wires Business and Retail Supply Business and shall prepare an Allocation Statement to enable

the Commission to determine the Tariff separately for :—

(a) Distribution Wires Business;

(b) Retail Supply of electricity:

Provided that in case complete accounting segregation has not been done between the

Distribution Wires Business and Retail Supply Business of the Distribution Licensee, the


Aggregate Revenue Requirement of the Distribution Licensee shall be apportioned between the

Distribution Wires Business and Retail Supply Business in accordance with the following

Allocation Matrix”

As mentioned in the above extract in case the Distribution Licensee does not have complete accounting

segregation between the Distribution Wires Business and Retail Supply Business, which is the case with

BEST, the segregation has to be done with the help of allocation matrix provided in the Regulations.

However under Section 42(3) of the Electricity Act 2003 BEST, being a local Authority has been

exempted from offering its network for wheeling of electricity to Open access users. The Distribution

Open Access Regulations framed by the Hon’ble Commission also exempt BEST from the purview of

Distribution Open Access Regulations.

BEST clarifies that, it being a Local Authority, is not required to segregate its Wires Business and Supply

Business, for determination of wheeling and retail supply charges separately. BEST has submitted the

segregation of Wires Business and Supply Business as per Regulation 68 of MERC MYT Regulations, 2015

for submission of formats required for petition only. BEST humbly submits that Hon’ble Commission had

followed similar approach for determination of Tariff while processing the MYT petition for second

MYT Control Period

Query 6

BEST should submit the Voltage-wise Cost of Supply for FY 2014-15, FY 2015-16 and for each Year of the

third Control Period, in accordance with the Judgment of Hon'ble APTEL in this regard.

Reply 6

BEST submits that it will submit the voltage wise cost of supply considering Judgment dated 26 July,

2012 of Hon’ble APTEL.

Query 7

BEST should indicate the following for each year of the third Control Period, in its main Petition as well

as Executive Summary:

a. Average Cost of Supply including TDLR

b. Average Cost of Supply including TDLR

c. Proposed category-wise increase in tariff.

Reply 7

BEST submits that the same will be incorporated in the revised petition.


B. Truing up for FY 2012-13, FY 2013-14 and FY 2014-15

Query 8

As regards the decrease in energy sales during FY 2013-14 and FY 2014-15 compared to energy sales

projected in MYT Order, BEST should submit the following:

a. Analysis and probable reasons for decrease in energy sales in area of BEST

b. Whether decrease in the energy sales in area/cluster/pocket specific or overall decrease is

observed?

Reply 8

BEST submits that during FY 2013-14 & FY 2014-15 lower Sales have been realised as compared to

the sales approved in MYT Order in Case No.26 of 2013 as follows:

(MU)

FY 2013-14 FY 2014-15

Approved Sales

( MYT Order)

Actual Sales Difference Approved Sales

(MYT Order)

Actual

sales

Difference

a b c=b-a d e f=e-d

4758.37 4351.52 (406.85) 5216.16 4418.83 797.33

The comparison of category-wise actual sales with respect to the Sales approved in the MYT Order

(Case No.26 of 2013) is given below:

Sr. No.

Consumer Category

Sales (MU) FY 2013-14 Sales (MU) FY 2014-15

MYT Order

Actual Diff. MYT Order

Actual Diff.

LT Category a b c=b-a d e f=e-d

1. BPL 0.52 0.07 (0.45) 0.68 0.05 (0.63)

2 LT I (Residential) 1836.45 1795.93 (40.52) 1920.90 1846.55 (74.35)

3 LT - II (a) (b) and (c) 1970.85 1604.94 (365.91) 2259.07 1584.700 (674.37)

4 LT – III,IV A,IVB Industrial

161.11 145.15 (15.96) 167.78 143.43 (24.35)

5 LT V , VI LT - VII (a) (b), LT - VIII

79.97 75.24 (4.73) 86.91 71.43 (15.48)

6

LT - IX (a) & (b) Hospital/Educational Institute

71.05 78.08 7.03 91.40 86.44 (4.96)


Sr. No.

Consumer Category

Sales (MU) FY 2013-14 Sales (MU) FY 2014-15

MYT Order

Actual Diff. MYT Order

Actual Diff.

HT Category 0.00

7 HT - I Industry 190.40 178.77 (11.63) 210.10 185.40 (24.70)

8 HT - II Commercial 371.96 350.52 (21.44) 399.50 358.01 (41.49)

9. HT - III Group Housing 34.05 32.82 (1.23) 35.32 33.19 (2.13)

10 HT - IV Temp 4.28 7.84 3.56 4.47 11.37 6.90

11 HT V-(a) Hospitals/ Educational Institutions

37.74 82.15 44.41 40.71 98.32 57.61

Sub Total H.T Category 638.43 652.10 13.67 690.10 686.29 (3.81)

Total 4758.37 4351.52 (406.85) 5216.16 4418.83 (797.33)

From the above details, it can be seen that, during FY 2013-14 & FY 2014-15, subsidising consumer

categories, LT Commercial categories LT-II (a), LT-II (b), LT-II(c), have mostly contributed for the above

lower sales growth, as follows:

(MU)

Tariff category

FY 2013-14 FY 2014-15

Sales

MYT

Order

Sales

(Actual)

Difference

Sales

MYT

Order

Sales

(Actual)

Difference

A B C=B-A D E F=E-D

LT Commercial

Categories LT II (a), LT II

(b) & LT II (c)

1970.85 1604.94 (365.91) 2259.07 1584.70 (674.37)

BEST submits that in its MYT Petition (case No.26 of 2013), the Sales projections for second MYT period

was done in line with the approved Business plan (Case No.124 of 2011).The comparison of Sales

projected by BEST in Business Plan Petition (Case No.124 of 2011), MYT Petition and the sales approved

in MYT Order (Case No.26 of 2013) is given below:

(MU)

Tariff

category

FY 2013-14 FY 2014-15 MYT

Business

Plan

MYT

Petition

MYT

Order Actual

MYT

Business

Plan

MYT

Petition MYT Order Actual

LT Comm.

Categories LT

II (a), LT

II (b) & LT II

(c)

1535.09 1509.06 1970.85 1604.94 1633.90 1593.09 2259.07 1584.70


As can be seen in the above table, the submission of BEST in its petition as regards to sales projection

of LT Commercial Categories is quite close to actual sales.

Moreover, in the second MYT period it was envisaged that additional sales on account of

development in the new areas such as Wadala truck terminal, Dharavi Make-Over and Mill land area

will materialise. Further, even though the mill land area development is underway, till now out of

total 57 Mill Land Plots only 9 Cases (16 %)have been materialized. Similarly due to slow pace of

development at Wadala Truck Terminal the sales envisaged has not materlised. The Dharavi

makeover project is yet to be approved by the GoM and hence demand envisaged from this project

has not yet picked up. All these factors have led to lower sales growth against MYT order, especially

for LT Commercial Categories(LT - II (a)(b) and (c). As such , the lower sales growth can be attributed

to lower pace of developments in the new development areas. The justification is also provided in

section 7.2 of the petition “Demand Assessment and Demand Projection”.

Query 9

As regards FBSM Bills, BEST has submitted in para 4.2.2 that MSLDC has finalized FBSM bills up to

September 2012 and in Para 5.3.3, the FBSM bills have been said to be received up to February 2013.

BEST should clarify the status of FBSM bills received by BEST and considered in Petition

Reply 9

As regards FBSM Bills received from MSLDC, BEST submits that it has received final weekly FBSM bills up

to 25 February 2013 and also received provisional weekly FBSM bills upto 20 April 2015.

The correction in the dates will be made in the revised petition.

Query 10

BEST should submit the IBSM Statements prepared by MSLDC for FY 2013-14 and FY 2014-15,

highlighting the energy consumed for BEST for FY 2013-14 and FY 2014-15

Reply 10

BEST is submitting herewith a DVD containing soft copy of the FBSM Statements prepared by MSLDC for

FY 2013-14 and FY 2014-15, highlighting the energy consumed for BEST for FY 2013-14 and FY 2014-15

as Annexure- Q10 (submitted in soft copy).

BEST submits that:

a. MSLDC is yet to finalize weekly FBSM bills for FY 2012-13, FY 2013-14 and FY 2014-15 therefore,

BEST has considered the Transmission Loss of 4.10% for FY 2013-14, derived by using following

method:


TPC-G's monthly drawl Statement gives information about BEST's Metered Drawl at T-D

Interface. The summation of monthly drawl at T-D Interface is works out to 4624.28 MU

for FY 2013-14. For FY 2013-14, the monthly Intra-State Transmission Loss available on

MSLDC's Website while preparing MYT Petition was considered for deriving Grossed up

drawl (Energy requirement at G-T Interface).

The summation of monthly derived Grossed up drawl is works out to 4822.04 MU's for

FY 2013-14. As such, Transmission Loss is worked out to 4.10% for FY 2013-14 [(4822.04-

4624.28)/4822.04*100].

For each month of FY 2013-14, the Pool Imbalance units are derived by deducting Loss

Adjusted Drawl from total Power Purchase Quantum (Availability) for that month. As

such, the Pool Imbalance units of (280.25) MU's shown for FY 2013-14 is the derived

balancing figure and it is summation of monthly derived Pool imbalance units for FY

2013-14. However, these Pool Imbalance Units may change after finalization of FBSM

Bills by MSLDC for FY 2013-14.

b. MSLDC is yet to finalize weekly FBSM bills for FY 2012-13, FY 2013-14 & FY 2014-15 therefore,

BEST has considered Transmission Loss of 3.90% for FY 2014-15, derived by using following

method:

TPC-G's monthly drawl Statement gives information about BEST's Metered Drawl at T-D

Interface. The summation of monthly drawl at T-D Interface is works out to 4727.63 MU

for FY 2014-15. For FY 2014-15, the monthly Intra-State Transmission Loss available on

MSLDC's Website while preparing MYT Petition was considered for deriving Grossed up

drawl (Energy requirement at G-T Interface).

The summation of monthly derived Grossed up drawl is works out to 4919.68 MU's for

FY 2014-15. As such, Transmission Loss is worked out to 3.90% for FY 2014-15 [(4919.68-

4727.63)/4919.68*100].

For each month of FY 2014-15, the Pool Imbalance units are derived by deducting Loss

Adjusted Drawl from total Power Purchase Quantum (Availability) for that month. As

such, the Pool Imbalance units of (330.24) MU's shown for FY 2014-15 is the derived

balancing figure and it is summation of monthly derived Pool imbalance units for FY

2014-15. However, these Pool Imbalance Units may change after finalization of FBSM

Bills by MSLDC for FY 2014-15.


Query 11

BEST should submit month-wise details of quantum, rate and total cost for pool imbalance units for FY

2012-13, FY 2013-14 and FY 2014-15

Reply 11

BEST submits that the month wise details of quantum of pool imbalance units, the rate and total cost for

FY 2014-15 is attached as Annexure-Q11.

Query 12

BEST should submit the year-wise RPO Compliance status for FY 2012-13, FY 2013-14 and FY 2014-15

clearly indicating the cumulative shortfall/(surplus) for solar and non-solar RPO separately.

Reply 12

BEST is submitting the year-wise RPO Compliance status for FY 2012-13, FY 2013-14 and FY 2014-15

clearly indicating the cumulative shortfall/(surplus) for solar and non-solar RPO separately.

The data attached as Annexure-Q12.

Query 13

BEST should submit the documentary evidences for purchase of REC indicating number of certificates

purchased and cost of purchase of REC.

Reply 13

RE procured Certificate along with copy of the invoice is attached in Annexure- Q13 (submitted in soft

copy) for FY 2012-13 to FY 2014-15.

Query 14

BEST should provide full details of the Merit Order Despatch (MOD) followed for power purchase by

BEST, including details of backing down of TPC-G's Units in FY 2012-13, FY 2013-14, and FY 2014-15,

separately for each month, including the tariff considered for the MOD, technical minimum level

considered for TPC-G's Units, etc.

Reply 14

The said details are attached in the Annexure-Q14 (submitted in soft copy).

Query 15

BEST should submit the hourly demand-supply position, i.e., the hourly (for 8760 hours) load and the

various sources through which the load has been met, including the deficit/surplus energy for FY 2012-

13, FY 2013-14, and FY 2014-15, in soft copy in MS Excel.


Reply 15

BEST will submit reply to this query separately as processing of voluminous data is involved.

Query 16

As regards the power purchase from TPC-G Unit 6 during FY 2014-15, BEST should provide the break-up

of power purchase quantum and cost under the following situations:

a. Unit 6 was run for meeting the increased demand and generation was shared by all

three distribution licensees

b. Unit 6 was run to meet the contractual obligation of BEST

Reply 16

BEST herewith submits the break up of Power Purchased Quantum and Cost of TPC-G Unit-6

during from FY 2014-15 is as follows:

Sr. No.

Particulars

Power Purchase Quantum

Total Variable

Cost

Variable Charges

MU's Rs. Crore (Rs./kWh)

a Unit 6 was run for meeting the increased demand and generation was shared by all three distribution licensees

168.65 219.23 13.00

b Unit 6 was run to meet the contractual obligation of BEST

84.08 47.27 5.62

Total 252.74 266.50 10.54

Query 17

BEST should provide the details of prior period payment of Rs. 3.74 Crore made to TPC-G in FY 2014-15

indicating the period of bill, etc., along with relevant documentary evidence.

Reply 17

BEST herewith submits the details of prior period payment of Rs. 3.74 Crore made to TPC-G in FY 2014-

15 as follows:

Sr. No.

Particulars Rs. Crore

1 Revised Supplementary Bill for Aug.11- Oct.11 dtd 21.04.2014 2.46

2 Revised Supplementary Bill for Nov.11-JAN.12. dtd 16.10.2014 1.27

3 Total 3.74

Relevant copies of said TPC-G Bills are submitted herewith as Annexure- Q17.


Query 18

BEST should submit the source-wise Renewable Energy procured for FY 2012-13, FY 2013-14, and FY

2014-15 separately in the format provided below:

Source-wise Quantum and Cost of RE power purchase

Month Source Genera

tor

name

RE

techno

logy

Quant

um

Lande

d cost

for

RInfra

-D

Whee

ling

loss

wheeling

charges

Cost at

MSETCL

Periphery

Preferential

tariff

approved by

the

Commission

MU

Rs/

kWh % Rs/ kWh Rs/ kWh Rs/ kWh

Reply 18

The said details are attached in the Annexure- Q18.

Query 19

As regards power purchase from external sources in FY 2012-13, FY 2013-14, and FY 2014-15,

a. BEST should clarify whether the same has been procured under Competitive Bidding,

and submit the results of the competitive bidding exercises carried out over each

respective year.

b. BEST should clarify whether short-term power was purchased on RTC basis or for

specific hours

Reply 19

BEST submits that as regards power purchase from external sources in FY 2012-13, FY 2013-14, and FY

2014-15,

a. BEST clarifies that it has procured power from external sources through Competitive

Bidding by publishing Expression of Interest (EoI) in news papers. The results of the

competitive bidding exercises carried out over each respective year is submitted as

Annexure-Q19.

b. BEST clarify that short-term power was purchased on RTC basis as well as for specific

hours.


Query 20

As submitted in the Annexure XXIII on Reconciliation of GFA, the total difference in GFA is Rs. 1.04 Crore,

however, the total difference in closing GFA of FY 2013-14 (Rs. 2039.60 Crore) and Opening GFA for FY

2014-15 (Rs. 2037.23 Crore) is Rs. 2.36 Crore. BEST should clarify the same and submit the revised

reconciliation of GFA.

Reply 20

BEST submits that from the details in Form No.5.1 of Truing up for FY 2013-14, it can be seen that the

closing GFA is Rs.2037.23 crores and Opening GFA for FY 2014-15 is Rs.2037.23 crores. BEST will make

necessary corrections in the True up formats.

Query 21

BEST should submit the actual impact of wage revision along with break up for different heads of the

employee expenses for FY 2012-13, FY 2013-14 and FY 2014-15.

Reply 21

BEST herewith submits the details of actual impact of wage revision with different heads of the

Employee expenses for FY 2012-13, FY 2013-14 & FY 2014-15, as under :-

FY 2012-13

The actual wage impact for FY 2012-13 is Rs. 57.43 crores, which consist of increase in Basic salary by

Rs.36.39 crores, HRA by Rs.9.74 crores, LTA by Rs.1.66 crores, Medical Allowance by Rs.0.87 crores,

Overtime payment by Rs.1.29 crores, PF by Rs.3.97 crores. & Gratuity by Rs.3.51 crores.

FY 2013-14

The actual wage impact for FY 2013-14 is Rs. 66.73 crs., which consist of increase in Basic salary by

Rs.26.12 crores, DA by Rs.13.13 crs., HRA by Rs.6.74 crores, LTA by Rs.0.45 crores, Leave encashment by

Rs.3.12 crs., Medical Allowance by Rs.0.35 crores, Overtime payment by Rs.4.69 crores, PF by Rs.4.89

crores & Gratuity by Rs.7.24 crores.


FY 2014-15

The actual wage impact for FY 2014-15 is Rs. 49.12 crores, which consist increase in Basic salary by

Rs.0.54 crores, DA by Rs.19.60 crores, HRA by Rs.2.55 crores, LTA by Rs.0.11 crores, Leave encashment

by Rs.1.72 crores, Medical Allowance decreased by Rs.0.09 crores, Overtime payment decreased by

Rs.4.10 crs., PF increased by Rs.3.08 crores. & Gratuity by Rs.1.38 crores and interim relief / wage

settlement (Arrears) of Rs.24.33 crores.

Query 22

As regards actual A&G expenses:

a. BEST should submit the details of 'Miscellaneous & general expenses' of Rs. 7.97 crore

for FY 2012-13, Rs. 7.60 Crore for FY 2013-14 and Rs. 8.81 Crore for FY 2014-15, under

'Other Costs'

b. BEST has reduced the 'Security Expenses' from the General Administration expenses

allocated to Supply Division. BEST should clarify the reasons for the same.

Reply 22

BEST submits the following details:

a. The details of Actual Miscellaneous & General Expenses are as under :-

Sr.No. Particulars FY 2012-13 FY 2013-14 FY 2014-15

(i) Medical Reimbursement to Staff (Approved Hospitals)

3,80,514.00 2,99,536.00 3,93,769.00

(ii) Medical Reimbursement to Staff (Non-Approved Hospitals)

13,35,784.00 10,27,085.00 4,88,123.00

(iii) Other Expenditure 1,58,08,633.00 1,94,83,311.00 2,39,83,569.00

(iv) Books & Periodical 15,571.00 19,795.00 19,620.00

(v) Photographic Materials 517.00 1,432.00 6,231.00

(vi) Printer Ribbons 31,18,435.00 30,09,847.00 30,57,474.00

(vii) Contribution to BEST Staff Amenities

4,19,11,525.00 3,82,54,228.00 3,99,01,737.00

(viii) Charges for Collection of Bills 1,33,22,651.00 1,00,92,697.00 1,00,13,680.00

(ix) Fees to Forum Members 6,59,977.00 7,68,000.00 6,82,144.00

(x) MERC Fees and Charges for ARR approval

10,95,500.00 6,36,100.00 5,22,000.00

(xi) Lease Rent for Distribution and Substation

20,91,986.00 24,25,143.00 41,71,762.00

(xii) Employer’s Contribution to ESIC 0.00 0.00 27,88,714.00

7,97,41,093.00 7,60,17,174.00 8,60,28,823.00


b. The Security Expenses of the General Administration Expenses allocated to Supply Division has

been reduced as the said expenses are already shown separately under security arrangement

head of A & G Expenses, as it is the payment of Security Expenses of BEST Electricity business.

Query 23

BEST should clarify the discrepancy in the actual O&M Expenses for FY 2012-13 reported in the following

tables:

Reference Actual O&M Expenses

(Rs. Crore)

Table 8 333.92

Table 37 333.32

Form 3 of Truing

up formats

333.92

Reply 23

BEST submits that, the actual O&M expenses for FY 2012-13 excluding the impact of wage revision is Rs.

333.92 Crores as mentioned in table 8 and Form 3 of truing up formats. BEST submits that the correction

will be incorporated in the revised petition.

Query 24

BEST should confirm that depreciation is less than 90% of GFA for all assets, since assets cannot be

depreciated beyond 90% of GFA in accordance with the MYT Regulations, 2011.

Reply 24

BEST confirms that the Depreciation does not exceed 90% of the GFA for all the assets.

Query 25

BEST should submit the documentary evidence for the actual interest rate for all actual outstanding

loans as on 1st April 2012, 1st April 2013, and 1st April 2014.

Reply 25

BEST is submitting herewith the documentary evidence for the actual interest rate for all actual

outstanding loans as on 1st April 2012, 1st April 2013, and 1st April 2014Is attached as Annexure-Q25


Query 26

As regards the funds available from REC under National Electricity Fund, BEST should clarify

a. whether any amount has been drawn under this Fund?

b. If yes, year-wise amount drawn and for which capital expenditure?

c. details of interest subsidy available to BEST and the effective interest rate for such

loans.

Reply 26

a&b. BEST submits that the it has availed total loan of Rs.134.09 crores from REC i.e. on 4.8.15 Rs.114.18

crores, & 6.8.15 Rs.19.91 crores

(b) This fund is availed against the Capital expenditure of FY 2013-14 & F.Y. 2014-15 for the various

schemes of the Undertaking approved by the Commission. Considering this fact, the Undertaking has

not availed 70% Debt loan for the Capital expenditure for FY 2015-16.

(C) The rate of REC loan is @11.75% per annum. Till today, the Undertaking have not availed any

subsidy from the REC. Further as per the REC loan policy, the Undertaking will be eligible to claim the

subsidy of interest after completion of 1 year loan disbursement.

Query 27

BEST should submit the computation of applicable interest rate as per MERC MYT Regulations, 2011 in

the following format for FY 2012-13, FY 2013-14 and FY 2014-15

Source/Bank

Name

Outstanding Loan

as on April 1

Applicable Interest

Rate (%)

Weighted Average

Interest Rate (%)

FY 2012-13

Bank 1 Loan 1

Loan 2

... ...

Bank 2...

...

FY 2013-14

Bank 1... Loan 1...

...

FY 2014-15

Bank 1... Loan 1...

...


Reply 27

BEST is submitting herewith the computation of applicable interest rate as per MERC MYT Regulations,

2011 in the specified format for FY 2012-13, FY 2013-14 and FY 2014-15.

Term Loan

Source/Bank Name

Outstanding Loan as on April 1 Rs. Crores

Applicable Interest Rate (%)

Weighted Average Interest Rate (%)

FY 2012-13

DPDC 1.60 14.25 10.65

APDRP 37.98 11.33

Vijya Bank 63.00 10.75

BoI 58.75 10.00

FY 2013-14

DPDC 1.44 14.25 11.16

APDRP 37.98 11.33

BoI 67.46 11.00

FY 2014-15

DPDC 1.28 14.25 10.64

APDRP 24.48 11.33

Dena Bank 54.86 10.25

FY 2015-16

DPDC 1.11 14.25 10.70

APDRP 22.27 11.33

Syndicate Bank 91.75 10.50

Working Capital Loan

Source/Bank Name Outstanding Loan as on April 1 Rs. Crores



FY 2012-13

Canara Bank Term Loan 57.50 13.50 12.29

Canara Bank Shrort Term

149.90 10.75


Source/Bank Name Outstanding Loan as on April 1 Rs. Crores



Canara Bank Cash Credit

225.00 13.00

FY 2013-14



225.00 10.25

MCGM 400.00 10.00

FY 2014-15



225.00 10.20

MCGM 1600.00 10.00

FY 2015-16



225.00 9.65

MCGM 1403.30 10.00

The proof for interest rate is submitted as Annexure-Q27. BEST submits that some of the interest rates

are revised from the figure submitted in the petition. BEST will update the calculation based on these

interest rates in the revised petition.

Query 28

As regards the temporary advance of Rs. 1600 Crore availed from MCGM at interest rate of 10%, BEST

should confirm whether this temporary advance has been taken to meet transport deficit or deficit of

supply business?

Reply 28

BEST submits that the total Temporary Advance of Rs.1600.00 crores availed from MCGM has been

utilized for payment of outstanding TPC bills. The said details are shown in attached Annexure-Q28.

Query 29

As regards the interest on consumer security deposits claimed by BEST for FY 2012-13, FY 2013-14 and

FY 2014-15, BEST should clarify whether this amount has been actually paid/adjusted against

consumers' bills or is it the amount provided for under the Accounts?


Reply 29

BEST submits that the Interest on Consumer Security Deposit claimed by BEST for FY 2012-13, FY 2013-

14 & 2014-15 has been actually paid to Consumers.

Query 30

As regards the consumer security deposit for FY 2012-13, FY 2013-14 and FY 2014-15, BEST

should submit the details of consumer security deposit as opening balance, addition during

year, closing balance and interest paid in the following format

Sr. No. Particulars FY 2012-13 FY 2013-14 FY 2014-15

1 Opening Balance

2 Addition during the year

3 Closing balance

4 Interest Paid

Reply 30

BEST is submitting, the details of consumer security deposit for FY 2012-13, FY 2013-14 and FY

2014-15, and interest paid in the specified format


1 Opening Balance 251.26 259.76 252.52

2 Addition during the year 8.5 (7.24) 95.68

3 Closing balance 259.76 252.52 348.20

4 Interest Paid 23.18 22.50 30.47

Query 31

BEST should submit the details of Contribution to Contingency reserve for FY 2012-13, FY 2013-

14 and FY 2014-15 in the following format:


1 Opening Balance of Contingency Reserves

2 Opening Gross Fixed Assets

3 Opening Balance of Contingency Reserves as % of Opening GFA

4 Contribution to Contingency Reserves during the year



5 Utilisation of Contingency Reserves during the year

6 Closing Balance of Contingency Reserves

7 Closing Balance of Contingency Reserves as % of Opening GFA

Reply 31

BEST is submitting the details of Contribution to Contingency reserve for FY 2012-13, FY 2013-

14 and FY 2014-15 in the specified format:


1 Opening Balance of Contingency Reserves 11.09 15.49 18.79

2 Opening Gross Fixed Assets* 1847.02 1957.16 2032.88

3 Opening Balance of Contingency Reserves as % of Opening GFA

0.25% 0.25% 0.25%

4 Investment made to Contingency Reserves during the year

4.40 3.30 1.00

5 Contribution to Contingency Reserves during the year

4.62 4.89 5.08

6 Utilisation of Contingency Reserves during the year

0 0

7 Closing Balance of Contingency Reserves 15.49 18.79 19.79

8

Closing Balance of Contingency Reserves as % of Opening GFA

0.84% 0.96% 0.97%

* Excluding Land

BEST submits that, the investment is made in next year based on provisions made in current year and

hence investment and provision will not match. However, investment till 2013-14 will be more than

provision made till 2014-15. The year -wise details is as submitted below.


F.Y. Provision Investment Details of Investment

Invest transferred to General Invest.

Balance available under Investment in Contingency Reserve

Interest earned Transferred to Non-Tariff Income

2008-09 6.45 6.48 8.20% G.O.I. Oil bond dtd. 3-12-09

3.24 3.24 0.21

2009-10 7.04 7 8.83 % IRFC dtd. 3.5 3.5 0.29

6.10.10

2010-11 7.7 6.80 + 1.90 9.97 % APPF dtd.

+ Int.1.00 23.2.2012 & 5.985% APPPF dtd. 15.3.2012

3.40 & 0.95 3.40 & 0.95 0.43

2011-12 4.4 4.4 9.56% TPF Infrastructure Dev.Corporation

0 4.4 0.09

2012-13 4.62 3.3 9.19% Tamil Nadu Power Finance & Infra Development Corporation Ltd.

0 3.3 0.1

2013-14 4.89 1 10.03% Rajasthan SDLSPL 2028

0 1 0.04

2014-15 4.92 5.13 8.55% Rajasthan SDLSPL 2022

0 5.13 0

Total : 11.09 24.92 1.16

Query 32

As regards Contingency Reserves, BEST should submit

a. the opening balance of contingency reserves as on April 1st of each Year from FY 2012-

13, FY 2013-14, and FY 2014-15, as well as the different interest rates for the various

securities accumulated under the Contingency Reserve.

b. documentary evidence showing that such contribution to contingency reserves has been

invested in approved securities


Reply 32


a. Opening Balance of Contingency Reserve is as under : As on 1-4-12 As on 1-4-13 As on 1-4-14 Rs. 11.09 crs. Rs.15.49 crs. Rs.18.79 crs.

b. The documentary evidence of Investment is enclosed as Annexure-Q32.

Query 33

BEST should submit the reasons for claiming of interest paid to consumer on accumulated FAC of Rs.

9.58 Crore in FY 2014-15 under Other expenses, in view of the Commission’s Order dated November 25,

2014 in Case No. 88 of 2014.

Reply 33

BEST submits that the Hon'ble Commission in Case No.88 of 2014, has in principal Agreed that the

retention of negative FAC by BEST from September 2013 onwards is not entirely due to lapses on part of

BEST. Considering this fact, BEST has claimed the interest of Rs.9.58 crores paid to consumers on

accumulated FAC.

Query 34

As regards Non-Tariff Income for FY 2012-13, FY 2013-14, and FY 2014-15:

a. BEST should submit the details and sources of ‘Others’, which has contributed Rs. 3.20

Crore in FY 2012-13, Rs. 3.45 Crore in FY 2013-14, and Rs. 5.32 crore in FY 2014-15

b. Contract charges have been booked as Nil, because total revenue is lower than total

expenditure. BEST should clarify where this excess expenditure is booked?

Reply 34


a. The details and sources of “Others” which has contributed Rs.3.20 crores in FY 2012-13, Rs.3.45 crores in FY 2013-14 & Rs.5.32 crores in FY 2014-15 are as under :-


(1) Hire & Repairs to Electrical Appliances (13) Right to Information Act.

(2) Miscellaneous & General Charges (14) Load Certificate

(3) Revisit Charges (15) Tender Fees

(4) Change of Name (16) Demand Draft / Postal Order Charges

(5) Statement Charges (17) Dishonoured Cheque Charges

(6) Cash Discounts from Parties (18) E-Tender Service Facility Charges

(7) Penalty of outside parties (19) Inspection Charges

(8) Medical Examination Fees (20) Penal Interest on Let-out Premises

(9) Application, Registration and Processing Charges

(21) Recovery towards late Delivery of Materials

(10 Administrative Charges (22) Discount received on Contingency Reserve Fund Investment

(11) Miscellaneous Search Report (23) Other excluding above heads

(12) Retention through Pay sheet

b. The expenses incurred for Allied Departments are not being considered by the Commission and

the same is deducted from the Gross Employee Expenses. As such, the said expenditure is absorbed by the Undertaking

Query 35

In the context of the Property Insurance Fund created by BEST through expenses booked under A&G

expenses, BEST should

i. submit the details of the total balance under this Fund for 2012-13, FY 2013-14,

and FY 2014-15

ii. the details of the management of this Fund, including documentary evidence for

the same

iii. Whether the Fund created through expenses booked under A&G expenses is

only for the Electricity Business

iv. Under which circumstances is the Fund drawn upon?

v. Whether the Funds are invested in any securities or bank?

vi. If invested, under which head of income is the interest/dividend income

considered for FY 2012-13, FY 2013-14, and FY 2014-15?

Reply 35

BEST submits the point wise reply as follows:

i. The details of year-wise Property Insurance Fund are as under :-

(Rs. in Crores )

F.Y. 2012-13 F.Y. 2013-14 F.Y. 2014-15

89.12 95.18 96.99


The said amount is utilized for Capital Expenditure of Supply Division and not invested in the Bank.

ii. The object of this fund is to cover the risk of properties of Undertaking. This fund is created by

charging annually to Revenue A/c 0.5% of value of gross fixed assets. As a normal business policy

all such assets/properties are required to be adequately covered against various risk by taking

out insurance policy with outside business company . Depending up on the value of the asset

and risk covered the premium is required to be paid for such insurance cover . However in case

of BEST, a policy has been decided to have own property insurance fund instead of paying heavy

insurance premium to an outside agency thereby on one side, it is only provision made by

charging to Revenue A/c. and there will not be any actual cash flow and as a result the funds will

remain with the Undertaking. This policy was approved by BEST Committee vide BCR No. 625(C)

dated 17 June 1949 & C.R.No.659 dated 8th August, 1949 and same has been raised from time

to time with necessary approval of BEST Committee & Corporation.

iii. It is true that the Fund created through expenses booked under A&G expenses is only for the

Electricity Business.

iv. This fund is created to cover the Assets of Undertaking from the risk of Riot , Strike, earthquake,

the circumstances beyond the control the management . Therefore under any of the

circumstances mentioned above if there is damage to the property of BEST ,this fund is utilized

by debiting the fund account and crediting to Bank A/c.

v. The fund is not invested in any securities or Bank. The said entry is a book entry based on the

policy approved by BEST Committee and Corporation.

vi. Since amount is not invested against the Property Insurance Fund, no income is booked.

Query 36

BEST has submitted the incentive for Wire and Supply Availability considering the target Wires

Availability and target Supply Availability at 95%. In this regard,

a. In the MYT Order, the Commission has stipulated the target Wire Availability at 98.42% and target

Supply Availability at 100%. Hence, BEST should re-calculate the incentive for Wire Availability and

Supply Availability considering the target Wires Availability and target Supply Availability at 98.42%

and 100%, respectively.

b. BEST should submit the sources of generation capacity considered against 'Base Load contracted

capacity' and against 'Peak Load contracted capacity' for FY 2012-13, FY 2013-14 and FY 2014-15.

c. BEST should submit the hourly load curve for FY 2012-13, FY 2013-14 and FY 2014-15, to establish

the base load and peak load.


Reply 36

BEST submits point wise reply as follows:

a. The claim has been made as per MYT regulation 2011.

b. The figures for Load of FY 2012-13, FY 2013-14 and FY 2014-15 are as shown in table F12 of

True-up excel Model and F24 of MYT Model. The said calculation and information are hidden as

they do not form the part of formats required by MERC. BEST submits that it will submit the

hard copy printout of said calculation as Annexure to revised petition. Further BEST submits that

Base load and Peak Load as submitted in section 7.2 of the petition are prepared based on

actual load of 15 minutes block for past 7 years. However the Base Load and Peak Load thus

estimated is at T<>D interface while the same is grossed up with transmission loss to arrive at

Base Load and Peak Load at G<>T interface used for calculation of incentive. Also, there is minor

correction in Base Load data of FY 2012-13 and FY 2013-14 as submitted in F12 of excel model

and the same will be corrected with Base Load data submitted in section 7.2 of the petition

while submitting the revised petition.

c. BEST in section 7.2 of the petition has submitted actual monthly maximum and minimum

demand for estimation of base and peak load. As submitted in the petition, the same is based on

actual load of 15 minutes block for past 7 years. The actual load of 15 minutes block for FY 2012-

13, FY 2013-14 and FY 2014-15 is provided in excel format as an Annexure-Q36.(Soft Copy)

Query 37

BEST should submit category-wise consumption in different TOD time-slots for FY 2012-13, FY 2013-14

and FY 2014-15.

Reply 37

BEST herewith submits the category-wise consumption in different TOD time-slots for FY 2012-13, FY

2013-14 and FY 2014-15 as Annexure-Q37

Query 38

The actual Transport Deficit in FY 2012-13, FY 2013-14 and FY 2014-15 as submitted by BEST is

significantly higher than the Transport Deficit projected by BEST in its MYT Petition and approved by the

Commission in the MYT Order, as the actual combined Transport Losses for these three Years have been

claimed as Rs. 2259 crore as against the approved amount of Rs. 1200 crore. In this regard, BEST should

submit the detailed reasons and justification for the increase in the Transport Deficit.


Reply 38

Please refer reply to Query No. 2.

Query 39

As regards Table 80, BEST should clarify whether TPC-G has levied any carrying cost, since BEST has

sought carrying cost on past recovery of TPC-G though the same has been paid to TPC-G in FY 2013-14

itself.

Reply 39

BEST submits that as per the Hon’ble Commission’s directive in Order dated 5 June, 2013 in Case No.

177 of 2011, BEST has made the payment of Rs. 304.15 Crore in 10 equal installments from June, 2013

to March, 2014. However, in MYT Order dated 28 August, 2013, the Hon’ble Commission has clubbed

the amount of Rs. 304.15 Crore with the other revenue gap items and considered the amount in

revenue gap at the end of FY 2012-13 instead of considering the same in power purchase expenses for

FY 2013-14 and allowed the recovery in 3 years. With the same philosophy, BEST has considered the

recovery of revenue gap other than Rs. 304 .15 Crore as mentioned in table 76 in three years and the

recovery of Rs. 304.15 Crore is considered in the same year as it was actually paid in the same year, with

the same philosophy of MYT Order. BEST clarifies that TPC-G has not levied any carrying cost on past

recovery of TPC-G of Rs. 304.15 Crore.

Query 40

BEST has stated that it has considered the actual energy sales from April to November 2015, however, in

Table 115; it has submitted actual sales from April to September, 2015. BEST should clarify the same

Reply 40

BEST submits that it has considered the actual energy sales from April 2015 to November 2015 and

estimated the sales for December 2015 to March 2016. BEST adopted this approach to provide a better

estimate for energy sales for FY 2015-16. BEST has not changed the format specified by the Hon’ble

Commission in its MYT Regulations; however the sales reflecting in Form 1 for the months of Oct 2015

and Nov 2015 are actual sales for these months.

Query 41

BEST should submit the reason for considering the same growth rate of 3.90% for all categories for

projecting the energy sales for remaining period of FY 2015-16, instead of considering actual growth rate

for each category over previous year.


Reply 41

BEST submits that, it has considered the actual sales up to November 2015 for FY 2015-16 and

calculated increased in growth on actual sales up to November 2014 for FY 2014-15. The growth rate has

been worked out at 3.90% which has been applied on the month wise sales of December 2014 to March

2016 to arrive at estimated sales for December 2015 to March 2016. This particular approach is adopted

only for estimating four month sales of FY 2015-16. However while projecting sales for FY 2016-17 to FY

2019-20 onwards the CAGR is considered for each of the category of consumer over previous years.

Query 42

BEST should submit the Unit-wise details of:

a. actual and estimated power purchase quantum and cost for TPC-G, separately, in the

following format:

Unit of TPC-G

Generation Capacity

(MW)

% of total power

procurement from TPC-G


(MU)

Fixed/ Capacity Charges

(Rs/KWh)

Variable Charges

(Rs/KWh)

Total Variable Cost (Rs Crore)

Total Power

Purchase Cost

(Rs Crore)

Total Power

Purchase rate

(Rs./kWh)

Reply 42

a. BEST submits herewith, the Unit-wise details of:

1. actual power purchase quantum and cost for TPC-G from April 2015 to December 2015, in

the specified format:

Unit of TPC-G Generation

Capacity

% of Total Power

procurement from

TPC-G


Fixed/ Capacity Charges

Variable Charges

Total Variable

Cost

Total Power

Purchase Cost

Total Power

Purchase Rate

(MW) (MU) (Rs./Kwh

) (Rs./Kw

h) (Rs.Cror

e) (Rs.Cror

e) (Rs./Kw

h)

Unit-4 108 62.65 -1.11

Unit-5 500 51.17 1335.83 156.33 2.90 387.56 543.89 4.07

Unit-6 500 *51.17 3.86 74.87 26.73 10.33 85.20 220.50

Unit-7 180 51.17 409.43 74.61 2.74 112.33 186.94 4.57

Unit-8 250 40.00 578.99 79.55 2.84 164.65 244.20 4.22

Hydro 447 51.17 409.54 62.93 1.51 61.66 124.60 3.04

Thermal Incentive 1.27

Total 1985 2736.53 448.29 2.69 736.53 1186.09 4.33

2. estimated power purchase quantum and cost for TPC-G from January 2016 to March 2016,

will be submitted in the revised petition.


Query 43

BEST should submit the documentary evidences for actual purchase of REC and estimated quantum of

purchase of REC and corresponding cost of REC.

Reply 43

RE procured Certificate along with copy of the invoice for FY 2015-16 upto December 2015 is attached in

Annexure- Q43 (submitted in soft copy).

Query 44

BEST should submit the source-wise Renewable Energy procured from April 2015 to December 2015.

BEST should further indicate clearly the name of the source, RE technology, the rate of power, etc. in the

below format:

Source-wise Quantum and Cost of RE power purchase

Month Source Generator name

RE technol

ogy

Quantum

Landed cost

Wheeling loss

Wheeling charges

Cost at MSETCL Periphery

Preferential tariff approved by the

Commission

MU

Rs/ kWh

% Rs/ kWh Rs/ kWh Rs/ kWh

...

Reply 44

The said details for FY 2015-16 upto December 2015 is attached in Annexure- Q44

Query 45

BEST should submit the actual category-wise sales in FY 2015-16 till December 2015.

Reply 45

BEST herewith submits the actual category-wise sales in FY 2015-16 till December 2015 as Annexure-

Q45.

Query 46

BEST should submit the source-wise details including quantum, total cost and rate for power purchased

from April 2015 to December 2015


Reply 46

BEST is submitting herewith, the source-wise details including quantum, total cost and rate for power

purchased from April 2015 to December 2015 as Annexure-Q46.

Query 47

BEST should submit the hourly demand-supply position, i.e., the hourly (for 8760 hours) load and the

various sources through which the load has been met, including the deficit/surplus energy for the first 9

months of FY 2015-16, in soft copy in MS Excel.

Reply 47

BEST will submit reply to this query separately as processing of voluminous data is involved.

Query 48

BEST should provide full details of the Merit Order Despatch (MOD) followed for power purchase by

BEST, including details of backing down of TPC-G's Units in FY 2015-16 from April to December 2015,


considered for TPC-G's Units, etc.

Reply 48

BEST herewith submits the details of the Merit Order Despatch (MOD) followed for power purchase by

BEST, including details of backing down of TPC-G's Units in FY 2015-16 from April to December 2015,


considered for TPC-G's Units, etc as Annexure-Q48.(submitted in Soft Copy)

Query 49

BEST should submit the details of prior period payment of Rs. 162.17 Crore indicating the source,

amount, billing period, etc.

Reply 49

BEST is submitting herewith, the details of prior period payment of Rs. 162.17 Crore indicating the

source, amount, billing period, etc as Annexure-Q49.


Query 50

BEST should submit the basis for escalation of Employee Expenses, A&G Expenses and R&M Expenses

for October 2015 to March 2016.

Reply 50

BEST submits that the actual expenses incurred during the 1st Half i.e. April to September 2015 and

balance amount left out of Revised Budget approved by the BEST Committee and MCGM have

considered the expenses of 2nd Half of FY 2015-16.

Query 51

BEST should submit the computation of applicable interest rate as per MERC MYT Regulations, 2011 in

the following format for FY 2015-16

Source/Bank

Name

Outstanding Loan

as on April 1

Applicable Interest

Rate (%)

Weighted Average

Interest Rate (%)

FY 2012-13

Bank 1 Loan 1

Loan 2

... ...

Bank 2...

...

FY 2013-14

Bank 1... Loan 1...

...

FY 2014-15

Bank 1... Loan 1...

Reply 51

Please refer reply to Point No. 27.

Query 52

BEST should submit the documentary evidence for the actual interest rate for all actual outstanding

loans as on 1st April 2015.


Reply 52

BEST herewith submits the Documentary evidence for the actual interest rate for all actual outstanding

loans as on 1st April 2015, enclosed as Annexure-Q52.

Query 53

As regards the consumer security deposit for FY 2015-16, BEST should submit the details of consumer

security deposit as opening balance, estimated addition during year, estimated closing balance and

computation of interest on consumer security deposit.

Reply 53

BEST herewith submits the details of Consumer Security Deposit as Opening balance, estimated

addition during the year, estimated Closing balance and computation of interest on Consumer Security

Deposit in the table below :-

(Rs. in Crores )

Opening balance as on 1.4.15

Estimated additions during the year

Estimated closing balance as on 31.3.16

Computation of Interest

348.20 *10.45 358.65 27.80

* The estimated additions during the year is estimated @3% escalation over the actual deposit of FY 2014-15 (i.e. on Rs.348.20 crores ).

Query 54

BEST should submit the basis for estimation of Non-tariff Income for FY 2015-16

Reply 54

BEST submits that, it has estimated non tariff income for FY 2015-16 based on actual of first half of FY

2015-16 and considering past trend in second half of FY 2014-15.

Query 55

BEST should submit the category-wise actual revenue received for the period from April 2015 to

December 2015 in the same format as of Form 13

Reply 55

The category-wise actual revenue received for the period from April 2015 to December 2015 in the

same format as of Form 13 is attached as Annexure-Q55


Query 56

BEST should submit the month-wise and category-wise actual FAC charged in FY 2015-16 till date

Reply 56

The month-wise and category-wise actual FAC charged in FY 2015-16 till date is attached as

Annexure –Q56

Query 57

BEST should submit the actual capitalization in FY 2015-16 till December 2015 against DPR schemes and

non-DPR schemes

Reply 57

The actual capitalization in FY 2015-16 till December 2015 against DPR schemes and non-DPR schemes is

attached as Annexure-Q57

Query 58

BEST should incorporate at appropriate places in its Petition how it is complying the various

requirements specified in Regulation 22 of MERC MYT Regulations, 2015

Reply 58

BEST will incorporate in the revised petition how it is complying the various requirements specified in

Regulation 22 of MERC MYT Regulations, 2015

Query 59

BEST should indicate the units of measurement in Table 147 and 148 of the Main Petition

Reply 59

The unit of measurement for Table 147 and 148 of the Main Petition is MW. BEST will incorporate the

same in the revised Petition.

Query 60

As regards the revised demand projection submitted in Table 149 and Table 150 of main Petition:

BEST should clarify the differences in base load and peak load considered in Table 149 & 150 vis-a-vis

the base load and peak load considered for computing the supply availability in Table 34, 72 and 109 for

FY 2012-13, FY 2013-14 and FY 2014-15, respectively


Reply 60

BEST submits that Base load and Peak Load as submitted in section 7.2 of the petition are prepared

based on actual load of 15 minutes block for past 7 years. However the Base Load and Peak Load thus

estimated is at T<>D interface while the same is grossed up with transmission loss to arrive at Base Load

and Peak Load at G<>T interface used for calculation of incentive. Also, there is slight change in Base

Load data of FY 2012-13 and FY 2013-14 as submitted in F12 of excel model and the same will be

corrected with Base Load data submitted in section 7.2 of the petition while submitting the revised

petition.

Query 61

The Peak demand supply gap mentioned in Table 154 of Petition and Form 1.4 of MYT Formats are

different. BEST should clarify regarding the same and confirm the estimated peak demand supply gap

Reply 61

As submitted below the table in the petition, it has to be noted that demand supply gap calculated

through load curve and demand supply gap calculated through sales and generation forecast (based on

projected PLF) will be slightly different. For arriving at external purchase requirements in terms of MUs,

the forecast based on calculated through sales and generation forecast (based on projected PLF) are

being used which are found to be very near to the above projections. For planning for signing of new

PPAs for increasing the supply availability in terms of MW, the forecast based on load curve are being

considered.

Query 62

BEST should submit the demand-supply position on an indicative basis and broad power procurement

plan for the ten-year period commencing from April 1, 2016, as a part of its MYT Petition, in accordance

with Regulation 19.9 of MERC MYT Regulations, 2015

Reply 62

BEST in Energy Balance Section of the petition for Third Control Period for FY 2016-17 to FY 2019-20

has projected source wise power purchase plan and any gap is projected to be purchased through

bilateral route including exchange. BEST expects the same CAGR of sales growth and similar supply

positions for FY 2020-21 to FY 2025-26 and any gap will be met through bilateral route including

exchange. BEST submits that the details of sales forecast and supply position on an indicative basis and

broad power procurement plan for the ten-year period commencing from April 1, 2016 will be

incorporated in the revised petition.


Query 63

As regards the impact of DSM measures submitted in Table 158:

a. BEST should submit status of various DSM programs initiated or proposed during the

control period along with estimated energy savings.

b. The computation of energy savings mentioned in Table 158 against each proposed DSM

scheme.

Reply 63

BEST submits the details as regards the impact of DSM measures submitted in Table 158 as follows:

a. Status of various DSM programs initiated or proposed during the control period along

with estimated energy savings is attached as Annexure-Q63a.

b. The computation of energy savings mentioned in Table 158 against each proposed DSM

scheme is attached as Annexure-Q63b.

Query 64

BEST in Table 151 has submitted that its existing PPA with TPC-G would expire on March 31, 2018,

however, BEST has shown availability of power from TPC-G from FY 2018-19 onwards in Form 1.4 and

has shown power purchase from TPC-G for FY 2018-19 and FY 2019-20. In this regard:

a. BEST should clarify regarding the basis for considering the power purchase from TPC-G

post expiry of existing PPA.

b. Whether BEST has entered into any MoU with TPC-G for procurement of power post-

expiry of the PPA? If yes, copies of the correspondence in this regard should be

submitted.

Reply 64

BEST submits that:

a. BEST is in receipt of letters from TPC (G) dated 16.07.2012, 17.01.2014, 03.12.2015 on

the matter of extension of existing PPAs. In this context, we had written to TPC (G) that

PPA would be extended subject to the conversion of unit 6 into coal and with flexibility

and economic viability clauses. Further, BEST submits that as per the Clause 3.3.1 of

existing PPA, for extension of PPA, BEST shall give a written notice to the TPC (G) “Prior

to at least 180 days before the expiry date”. Various deliberations are being done to

negotiate the matter of extension of PPAs with TPC (G).

b. BEST has not yet entered into any MoU with TPC-G for procurement of power post-

expiry of the PPA. However, deliberations are in progress as stated in point “a” above.


BEST further submits that it has received a Draft Power Purchase Agreement from TPC

(G).

Query 65

BEST should justify how it has projected the realistic power purchase requirement from all Generating

Stations considered for power purchase based on the Merit Order Dispatch principles, in view of

Regulation 6.4 of MERC MYT Regulations, 2015

Reply 65

It is submitted that the basis for source wise estimation of power purchase units for the entire control

period is presented in Energy Balance Section(para 7.6.9 of the petition) of the petition for Third Control

Period for FY 2016-17 to FY 2019-20 and any gap is projected to be purchased through bilateral route

including exchange. BEST would like to submit that merit order is followed while scheduling of power.

Query 66

BEST, in Table 172 of the Petition, should indicate the source-wise power purchase rate (Rs./kWh) for

each year of the Control Period

Reply 66

The following table shows the source wise power purchase rate Rs./kWh) for each year of the Control

Period

Rs. /kWh

Particulars FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20

TPC-G Hydro 2.57 2.57 2.57 2.57

TPC-G Unit No-5 4.24 4.24 4.22 4.18

TPC-G Unit No- 7 4.81 4.90 4.81 4.90

TPC-G Unit No-8 4.42 4.52 4.42 4.45

Welspun Energy Maharashtra Ltd. 8.56 8.56 8.56 8.56

Spark Green Energy Ahmednagar Ltd.* 7.50 7.50 7.50 7.50

Spark Green Energy Satara Ltd.* 7.50 7.50 7.50 7.50

Additional Purchase for Solar RPO* 7.08 7.08 7.08 7.08

Additional Purchase for Mini Micro Hydro* 5.62 5.62 5.62 5.62

*Energy rates are considered as per the preferential tariff in Case No. 135 of 2015.

BEST submits that, the same will be incorporated in revised petition.

Query 67

BEST should explain the computation of escalation factor of 5.38% considered for escalating O&M

expenses for the Control Period


Reply 67

BEST submits that, it has computed the normative O&M expenses based on the composite norms under

Regulation 72 and 81 of MERC MYT Regulations, 2015. For Projecting O&M expenses of ensuing years,

the escalation of 5.38% per annum on account of inflation factor corresponding to increase in WPI Index

declared by Office of Economic Affairs and CPI index declared by the Ministry of Labor & Employment,

Government of India in the ratio of 60% and 40%, reduced by efficiency factor of 1%. The calculation for

the same is as presented below.

CPI Index

Year Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Total Avg. Weighted Average

FY 2013-14 10.24 10.68 11.06 10.85 10.75 10.7 11.06 11.47 9.13 7.24 6.73 6.7 116.61 9.72

FY 2014-15 7.08 7.02 6.49 7.23 6.75 6.3 4.98 4.12 5.86 7.17 6.3 6.28 75.58 6.30

Total 16.02 8.01

WPI Index

Year Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Total Avg. Difference Between

Two years

FY 2013-14 171.3 171.4 173.2 175.5 179 180.7 180.7 181.5 179.6 179.1 178.9 179.8 2131 177.6

FY 2014-15 180.8 182 183 185 185.9 185 183.7 181.2 178.7 177.3 175.6 176.1 2174 181.2

Total 3.63

WPI 60% 2.18

CPI 40% 3.20

Escalation Considered

(%) 5.38

Query 68

As regards the impact wage revision; BEST should submit following:

a. Pending amount towards the previous wage agreement and payment during each year

of the Control Period for corresponding amount

b. Estimated number of employees with whom BEST is proposing to enter into wage

agreement

c. Details of wage revision and tenure for which the revision will be applicable

d. Since, the escalation is considered on the actual employee expenses, clarify how the

impact of wage revision is not covered under escalation of employee expenses.


Reply 68

BEST submits that:

a) An Agreements dated 28.04.2012 and 01.08.2012 have entered into with the BEST Workers

Union and Bombay Electric Workers' Union respectively in respect of revision of pay-scales and other

allowances for the period from 01.04.2006 to 31.03.2011 and for further period from 01.04.2011 to

31.03.2016. In terms of the said agreements, it was agreed that the employees on roll as on 01.04.2006

and employees appointed thereafter on regular will be made the payment of arrears on account of

revision of pay-scales and various allowances in three installments and the quantum of installment of

arrears will be decided by the General Manager and General Secretary of Union. Further, pay-scales and

other allowances of the "A" & "B" grade officers has also been revised with the approval of the B.E.S. &

T. Committee for a period commencing from 01.04.2006 to 31.03.2011 and for further period from

01.04.2011 to 31.03.2016. "A" & "B" Grade officers who are on roll are also held eligible for the payment

of arrears for period 01.04.2011 to 31.12.2012 on account of revision of pay-scales and allowances.

The Memorandum of Understanding dated 31.07.2013 signed with the BEST Workers Union in respect

of payment of arrears on account of revision of pay scales and other allowances. As per the said

Memorandum of Understanding, it was decided that the payment of arrears will be made to the

employees who are on roll in 48 EMIs (Equated Monthly Installments), out of which, one EMI each will

be payable alongwith the monthly salary/wages of the employees in the next 32 months commencing

from August,2013 (Payable in September,2013) to March,2016 through pay-sheet of the respective

month. Payment of remaining 16 EMIs will be paid in three installments within the Agreement period

i.e. before 31.03.2016.

Accordingly, employees as well as "A" & "B" Grade officers of the Undertaking are being paid arrears

amount along with their monthly salary/wages w.e.f. August,2013 (Payable in September,2013). The

Undertaking has made payment of 37 installments and payment of 1 more installment will be done by

March, 2016. As such, payment of total 38 installments will be done by March, 2016 out of 48

installment. The decision in respect of payment of balance 10 installments is pending.

In view of the above, pending arrears amount payable to all employees and "A" & "B" Grade officers of

BEST Undertaking on account of revision of pay scales and other allowances is Rs. 150 Crore

approximately. Out of this, the share of electricity business is being worked out and same will be

included in the revised petition.

b) Estimated number of employees with whom BEST is proposing to enter into wage agreement.

The BEST Undertaking is likely to enter into a wage agreement for the employees of the Transport

Industry and Common Administrative Department and Electric Supply Industry for a period of 5 years

from 01.04.20016 to 31.03.2021. Further, revision in the pay-scales and other allowances of “A” & “B”


Grade officers of the Undertaking for the period 01.04.2016 to 31.03.2021. Accordingly, number of

employees and officers as on 31.01.2016 are as under :-

Sr. No. Departments Officers Employees

“A” “B” Permanent Temporary

1 General Administration 110 323 2422 13

2 Electric Supply Branch 253 1055 6702 93

3 Transportation Engineering 40 88 5719 756

4 Traffic 69 217 26679 477

TOTAL 484 1683 41522 583

GRAND TOTAL 44272

It may be stated here that the number of employees/officers which will be covered under wage settlement for the period 01.04.2016 to 31.03.2021 cannot be forecasted at the present juncture but will moreover remain the same as shown above or with some variations.

c. Details of of wage Revision and the tenure for which the revision will be applicable. Prior to year 1993, agreements signed with the Representative and Approved Unions for a period of three years. In the Agreements dated 18.7.1993 and 01.9.1993 entered into with the BEST Workers’ Union and the Agreement dated 10.9.1993 entered into with the Bombay Electric Workers’ Union on Dearness Allowance, it was decided that the said Agreements will be valid for a period of 5 years viz. from 1st April 1991 to 31st March, 1996. Meanwhile, the Agreements for revision of Pay-scales expired on 31st March, 1993. Thereafter, in the Agreements dated 12.7.1994 and 18.8.1994 entered into with the BEST Workers’ Union and the Bombay Electric Workers’ Union, respectively for the period from 1st April 1993 to 31st March 1996, it was agreed that henceforth, there will be only one Agreement for revision of Pay-scales as well as Dearness Allowance and other allowances. Accordingly, the Agreements dated 25.6.1997 and 15.7.1997 were entered into with the Representative and Approved Unions for a period of 5 years i.e. from 1st April 1996 to 31st March 2001 covering both the revision of Pay-scales and Allowances. Thereafter, agreements dated 06.06.2006 and 08.06.2006 were signed with the said two Representative and Approved Unions for a period of 5 years commencing from 01.04.2001 to 31.03.2006. An agreement dated 28.04.2012 and 01.08.2013 entered into with Unions for a period of 01.04.2006 to 31.03.2011 and further period from 01.04.2011 to 31.03.2016.

In view of the above, the tenure of the proposed agreement in respect of revision of pay scales and other allowance will be for a period of 5 years commencing from 01.04.2016 to 31.03.2021. d) Since, the escalation is considered on the actual employees expenses, clarify the impact of

wage revision is not covered under escalation of employees expenses.

The Management was not in a position to work out or assume any additional financial burden on account of proposed revision of pay-scales and other allowance to be borne by the Undertaking for want of exact demands from the Representative and Approved Unions functioning in the Undertaking. However, the estimated financial impact to the tune of Rs. 563.63 Crores on account of proposed revision of pay-scales and other allowances for whole Undertaking for a period from 2016 to 2020 have been submitted in the MYT Third Control period by taking into account approximate additional financial impact of last three wage revision agreements entered into with Representative and Approved Unions.


Query 69

As regards the Capital expenditure and Capitalisation proposed, BEST should submit Scheme-wise

details of the Capitalisation Plan with the following break-up and add in the Main petition;

a. DPR Schemes already approved by the Commission

b. DPR Schemes submitted to the Commission for approval and pending approval by the

Commission

c. DPR Schemes yet to be submitted to the Commission for approval

d. Non-DPR Schemes

Reply 69

BEST herewith submits the required details of the capitalisation plan as Annexure-Q69.

Query 70

BEST should show capital expenditure and capitalisation separately for on-going projects that will spill

over into the Control Period, and new projects (with justification) that will commence in the Control

Period, in view of Regulation 6.3 of MERC MYT Regulations, 2015.

Reply 70

BEST submits the details of the capital expenditure and capitalisation separately for on-going projects

that will spill over into the Control Period, and new projects (with justification) that will commence in

the Control Period as Annexure-Q70.

Query 71

BEST should submit and indicate the following in its Main Petition and executive summary:

a) Average Cost of Supply for each year of Control Period

b) Category wise increase in the tariff for each year of the Control Period

c) Increase in TDLR for each year of the Control Period

Reply 71

BEST has already supplied information on average cost of supply for the control period and category

wise increase in tariff for the control period in Reply to Query 7 of this submission. The increase in TDLR

in each year of the control period is provided as follows.


Particulars FY 2016-17 FY 2017-18 FY 2018-19 FY 2019-20

Revenue from

TDLR charge (Rs.

Crores)

1403.81 2140.30 2722.63 3452.96

Per unit TDLR

(Rs./kWh) 3.01 4.51 5.64 7.04

YoY Increase in

TDLR charge 100 % 52.46% 27.21% 26.82%

Query 72

BEST should confirm whether it proposes to continue with the prevailing Time of Day Tariff for the

Control period.

Reply 72

BEST confirms that it proposes to continue with the prevailing Time of Day Tariff for the Third MYT

Control period

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