By Nageshwar Patnaik, Bhubaneswar, January 29, 2015 ###

“All animals are equal, but some animals are more equal than others”. This dictum from George Orwell’s Animal Farm seems to be pervading the Odisha Electricity Regulatory Commission [OERC] so much so that they ensure more equal than others treatment to CESU while fixing Bulk Supply Price [BSP].

Ironically, the OERC was created as the first quasi judicial body to function as an independent and unbiased regulator to facilitate reforms in power sector in Odisha. But it BST/RST tariff orders clearly point the needle of suspicion at the regulatory body’s fairness in passing such judgments.

What is shocking most is that CESU, which supply power to mostly urban developed rich consumers in compact areas, is being subsidized at the cost of the NESCO and WESCO engaged in supplying power to vast hilly and remote areas in the state. It may be pointed out that OERC has been managing CESU for almost nine years after AES left the scene.

Reliance managed NESCO & WESCO appears to be subsidizing the OERC managed CESU having lower BST over the years as an estimate of total benefit accrued to CESU in last five years pegs at Rs. 1275 crore. [See the Table Below]

(Source: OERC Bulk Supply Tariff Order)

CESU’s BSP is 15 paise per unit less than NESCO and WESCO. And yet, CESU has been resorting to unscheduled and unannounced power cuts in gross violation of OERC norms. Yet, the regulatory body is silent with no action initiated against CESU, just because the latter is managed by OERC.

However, SOUTHCO was lucky to have escaped discriminatory treatment from OERC as the region has more marginalized section of society including scheduled caste and tribe and the Naxal menace.

The lack of fairness in OERC’s orders has been time and again confirmed by the Appellate Tribunal for Electricity (ATE) which has more than once reprimanded the OERC for what it called ‘total lack of judicial approach’.

“Sec 61 empowers the State Commission for tariff determination. It is only after the ARR is computed on realistic loss levels that the gap is ascertained that measures to bridge such gap which could be either through retail supply tariff (RST) hike, or decrease in bulk supply tariff (BST), or government subsidy or a combination of all measures is worked out. The State Commission never quantified the amount of gap and its queries pertaining to subsidy support from the government which was general in nature”, the ATE had observed.

The OERC, however, seems to be hell-bent to stick to its guns in protecting its baby CESU at the expense of the Reliance Infra-managed Discoms by defying the ATE’s orders, which, many observers believe, is contrary to the ethos of reforms process in power sector.