Another feature that has been hurting the development of industries in the state of U.P. has been the high incidence of minimum charges which have been increasing over the years,  interestingly,   as has been un-earthed by the High Power Committee, the theft of electrical energy is prospering in the state of U.P. with the full involvement of officers and officials of UPPCL and is a major source of earning of the political bosses and  such officers and officials,  but UPPCL / UPSEB claims that minimum consumption guarantee  is being increased to make theft of electricity less lucrative.  This is absolutely false because the persons engaged in theft of electrical energy with the full connivance of officers and officials of UPPCL are not affected by such provisions of tariff at all.  It is that poor industrial consumers who is honest but comes under red because of adverse market fluctuation, who perishes because very high minimum consumption of guarantee raises the rates of electricity  abnormal per portions  because of his low consumption and that too at a time when the adverse market fluctuations reduces his paying capacity and if the adverse market conditions continues  for long such industry has no alternative except to embrace its demise.

It is humbly submitted that theft can be stopped by strong will and posting of officers and officials of integrity and devotion to duty.  Any other measure is simply to fool ones own self .  We humbly request this Hon’ble Commission to effectively intervene in this matter.

The Hon’ble Commission in the booklet entitled “Issues in Electricity Tariff  Setting” has already observed that the industrial sector which bring the largest revenue to UPSEB and is a subsidising  sector, has recorded a  CAGR of only slightly over 1 percent during the same period in connected consumer  sector – has grown by 9.8 percent CAGR, the share of this sector in total connected consumer load has increased by only 2 percentage points during nineties.  These are disturbing trends, as these indicate that the revenue gap is on an increasing trend.  The above mentioned trend is also borne by the consumer-number statistics.

The UPPCL should have proposed measure to increase the industrial consumption, instead we notice that they observed on page 24 para 4.2 “That currently the tariff applicable to the industrial consumers is  higher than for  other categories and also the average cost of supply.  In view of this the industrial consumption has not grown in the recent past and has instead stagnated.  In view of the above no increase in the consumption by industrial consumer has been assumed during ensuing financial year.”  It is most surprising the Chief Minister of the state has been crying at top of his voice that his government will convert U.P. into Udyog Pradesh  and UPPCL is working in the direction of ensuring that the industries are not allowed to develop in the state.  We humbly submits before this Hon’ble Commission that if an exercise is carried out in reducing the rates of  industrial consumers and encouraging them to establish in the state and simultaneously steps are taken to effectively curb theft of energy, there will be no need  to increase the tariff and UPSEB will be able to collect the desired ARR.

It has been reported in the ARR that the collection    efficiency of UPSEB is around 82% and it is proposed to  increase it by 5%.   We notice that the total   amount of arrears outstanding against the consumers as on 31.3.99 was 4743.0 crores of rupees of which the  Public Lighting and Water Works were contributing    an amount of 1228.0 crores of rupees whereas their annual revenue is hardly 180.0 crores of rupees.  These indicate   that the Public Lighting and Water Works has not paid at all  for last 7 years.

The arrear against domestic and agriculture consumers were of the order of 2400.0 crores of rupees against the annual assessment of only 2000.0 crores of rupees which indicates that these categories have  with held revenue of as much as about 15 months.

No recovery is being made from the above categories because of the political interference in the working of the UPPCL.  We wonder when these political interference is going to stop or else will succeed in dragging  us to the absolute ruin because the condition are such that the industry cannot survive in the state and if such condition continues  any further it would not be possible  to check a huge number of units from closing down and migrating to other state and in that even the electrical industry in this state will simply  will not be able to sustain  itself  and there will be no need of either reforms or UPPCL.

            Interestingly the ARR is completely silent on the revenue receipt out of recovery of arrears.  The Hon’ble Commission is requested to ensure that such receipt should be linked with the ARR and the government should be forced to :

            i) To pay the arrears outstanding on the government departments and local bodies.

ii) To stop interfering in recovery of dues from agriculture and domestic consumers.

      The Power Tariff in view of commercial nature of UPPCL should be very simple & Transparent in its nature.  A simple module is given below:

Rates given below shall be effective from 1.8.2000 and shall remain valid till 31.7.2001.

All supplies shall be metered.

Low Power Factor Surcharges/High Power Factor Rebate

In respect  of the consumer upon whose premises MDI meter is installed, if the monthly average power factor falls below 0.85 lagging, the consumer shall pay on the billed amount, the low power factor surcharge of 1% for each 0.01 fall in power factor below 0.85 but this charge shall be limited to 5% only.

If the monthly average power factor comes above 0.85, rebate of 1% for each 0.01 rise on the billed amount will be allowed. Further , this rebate shall be limited to 5% only.”

1.  That the views expressed hereunder on ARR and tariff proposal of UPPCL for the year 2002-03 are the combined views of the members of the association in general, while its members may also, if they so desire, are free to place their views before this Hon’ble Commission.

2.      That the views/ comments on the ARR and tariff proposal of UPPCL for the year2002-03 are being submitted under the following subheads:-

A.      General views, basic objections & comments on the process and procedure adopted for tariff structuring.

B.     Objections and comments on the assumptions on vital issues culminating into the formulation of A.R.R.

C.      Comments on operational Efficiency Improvement Plan Methodology.

D.      Objections and comments on specific tariff proposal for various category of consumers especially  on LMV –2, LMV-6 & HV-2.

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