State to commission CAG audit into Rinfra, Tata Power accounts

The Maharashtra government will commission an audit by the Comptroller and Auditor General of India (CAG) into the accounts of Reliance Infrastructure (RInfra) and the Tata Power Company (TPC), which supply electricity to Mumbai.

In a relief to domestic power consumers in the city, which is serviced by four different power distribution utilities, the state also said it was trying to ensure that a uniform tariff was in place this year for those using up to 100 units every month with plans to extend it to 300 units next year. The demand for a uniform power tariff for Mumbai is a long-pending one.

In the state legislative assembly on Tuesday, Ashish Shelar (BJP-Bandra West) had charged that RInfra and TPC inflated their electricity tariffs by showing higher capital costs and demanded a CAG audit.

He also pointed to how Mumbai was serviced by four distribution utilities – namely TPC, RInfra, Maharashtra State Electricity Distribution Company Limited (MahaVitaran) and Brihanmumbai Electric Supply and Transport Undertaking (BEST) – which charged differential tariffs, and sought that common rates be introduced.

Energy minister Chandrashekhar Bawankule said the state government would issue instructions for a CAG audit of the two private distribution utilities. He added that the state would try to ensure a uniform power tariff for consumers across the four companies who used up to 100 units with plans to extend the uniform rate to those using between 100 and 300 units next year. Chief minister Devendra Fadnavis and Bawankule have also held meetings in this regard.

"We will ask the CAG to audit the accounts of RInfra and TPC… We will move the file to the state law and judiciary department. The scope of the audit will be on lines of that conducted for government utilities like MahaVitaran," said Bawankule, adding that this audit would also examine charges that the two utilities inflated their capital costs for higher tariffs.

"An audit is necessary instead of just approving their accounts as it is. This electricity is used by citizens... and hence, though it is a private company, an audit is in order," said Bawankule.

He added that while three utilities — BEST, TPC and MahaVitaran – had consented to ensure uniform tariffs for consumers using up to 100 units of power, RInfra was not agreeing to it. "We feel that uniform tariffs for consumers using up to 100 units will be introduced this year, with the system being extended to those using between 100 and 300 units next year," said Bawankule, adding that the companies would be asked to submit supplementary tariff petitions with the Maharashtra Electricity Regulatory Commission (MERC).

For domestic consumers using 0-100 units, the TPC provides the cheapest electricity at Rs2.05 per unit, followed by BEST (Rs3.55 per unit), MahaVitaran (Rs3.76) and RInfra (Rs4.79). The fixed charges for this category of consumers are Rs50 per month for MahaVitaran, TPC and Rinfra, and Rs40 for BEST.

Of the TPC's 6.80 lakh domestic consumers, 90% use 0-100 units and while 29 lakh customers use the RInfra network, the number of those being billed by the utility is 23 lakh with six lakh TPC consumers also using the same system.

Both TPC and RInfra refused to respond to queries on these developments.

Incidentally, the Delhi High Court had in 2015 struck down the decision of the Arvind Kejriwal-led Aam Aadmi Party (AAP) government in Delhi to get the accounts of three private power discoms audited by CAG. This was later challenged by the government in the Supreme Court.

Low tension domestic consumers using up to 100 units

Utility—Fixed charge---Variable charge per unit
MahaVitaran—Rs 50—376 paise
RInfra—Rs 50—479 paise
TPC—Rs 50—205 paise
BEST—Rs 40—355 paise