Special provision to check power tariff hike?

New Delhi: Power minister Ashish Sood has said govt is considering invoking Section 108 of the Electricity Act to order a CAG audit of the Rs 38,500-crore regulatory assets accumulated since 2007 with the objective of verifying the legitimacy and accuracy of the dues before the city’s power regulator starts liquidation.The move could provide temporary relief to consumers by delaying any immediate power tariff hike in the capital.Section 108 of the Electricity Act, 2003, gives Delhi govt the power to issue policy directions to Delhi Electricity Regulatory Commission (DERC) on matters involving public interest such as tariffs, subsidy policy, audits or consumer protection.“Delhi govt is considering invoking Section 108 of the Electricity Act to direct a CAG audit of the nearly Rs 38,500 crore regulatory assets accumulated since 2007 before any liquidation process is initiated. BJP govt will not let consumers face the burden of higher electricity tariffs. There should be complete transparency regarding how these huge dues of Rs 38,500 crore were created and sustained over the years. If the discoms were able to continue operations, make profits, expand infrastructure and even distribute dividends during the same period when such massive regulatory assets were building up, then it becomes essential to examine how these finances were being managed and whether the liabilities being passed on to consumers are fully justified,” Sood said.Regulatory assets are created when power distribution companies (discoms) are unable to fully recover the actual costs of power purchase, transmission, and distribution through consumer tariffs. This usually happens when govts refrain from increasing electricity tariffs due to political or populist considerations. The unrecovered gap is then recognised by the regulator as “regulatory assets” to be recovered through future tariff hikes.The issue is currently under review by appellate tribunal for electricity.