Brace for a quarterly jump in your power bill

BANGALORE: Be ready to see your electricity bills fluctuating, mostly on the upward side. For, the bills will soon get a component linked to fuel prices that are consistently moving north.
The Karnataka Electricity Regulatory Commission (KERC) has notified draft regulations to include a Fuel Adjustment Cost (FAC) component in the power tariff which will be revised every quarter.FAC is the price the consumer will have to pay for the fuel used in electricity generation.
With the prices of coal and diesel now being revised periodically, the increase is certain to reflect in the bill once the regulations are finally notified. The FAC regulation is likely to be implemented anytime. The draft specifies that distribution companies will have to recover the money spent on fuel from consumers periodically.
According to KERC officials, the tariff could go up by two to three paise per unit every quarter.
The KERC had notified in April 2012 about making FAC mandatory. While the draft notification is still open for public objections, implementation of the order is imminent. The regulations say that if the FAC per unit exceeds 10 paise in a particular quarter, it cannot be passed on to the consumer. Any FAC beyond 10 paise can be accommodated in the next quarter's revision.
"The fuel cost is one uncertain factor that plays a huge role in determining the power tariff and for decades together, the power plants have been running under losses due to the high cost of fuel. The commission's draft notification admits that generating units spend over 80% of their costs on buying fuel like coal, diesel, naphtha etc. The government has not allowed them to present their annual losses during tariff revisions resulting in deep financial crisis," said MG Prabhakar, industrialist and member of Federation of Karnataka Chambers of Commerce and Industry (FKCCI).
He, however, felt that this would not drill a big hole in the pockets of consumers provided the quality of power supply is improved and transmission and distribution losses are controlled.
FACTS
Karnataka Electricity Regulatory Commission will include FAC, Fuel Adjustment Cost, in power tariff
FAC is the price consumer will pay for fuel used in power generation
KERC says generating units spend 80% of money to buy fuel like coal, diesel, naphtha
Any FAC beyond 10 paise will be accommodated in next quarter's revision
Wasn't power hike alone enough?
I run a hotel and my family is big. Even the monthly electricity bills haunt me for several days. Wasn't power tariff hike alone enough to burden domestic consumers? I think the FAC should be levied only on industrial consumers
A Raghunath Rao, resident of Sanjaynagar