CERC slaps overdrawal notices on UP, J&K

The Central Electricity Regulatory Commission (CERC) today issued notices to utilities of Uttar Pradesh and Jammu & Kashmir for failing to pay the arrears of Rs 988 crore, excluding interest, on account of overdrawing from the grid.

Uttar Pradesh Power Corporation (UPPCL) has an outstanding principal amount of Rs 577.99 crore, and Jammu & Kashmir's Power Development Department (PDP) has to pay Rs 410.25 crore as principal for the period up to September 2.

The arrears would further increase after addition of interest at a rate of 1.5% per month on the principal amount.

While UPPCL has to clear arrears of about one year, the J&K utility has not paid dues for the past 3-4 years, a Central Electricity Regulatory Commission official told PTI.

"CERC has issued show cause notices to UPPCL and Power Development Department to explain by November 25 that why action should not be initiated against them for recovery of outstanding dues on account of unscheduled inter-change (UI) charges," the regulator said in a release.

The capacity charge and energy charge components of tariff cover only scheduled energy and any excess drawal is paid for only through UI mechanism. Non-payment of UI charges amounts to extracting energy from the grid without paying.