SEC moves court for fuel charge adjustment

The Surat Electricity Company (SEC) has filed a petition before the Gujarat Electricity Regulatory Commission (GERC), seeking approval to charge a fuel charge adjustment (FCA) from its consumers.

SEC is involved in power distribution in Surat.

Industry sources said the SEC petition follows the GERC approval to the Gujarat Electricity Board (GEB) to charge FCA from its consumers, including SEC.

"In view of th rising fuel costs, GEB had filed a petition with GERC, seeking approval to charge FCA from its consumers. The approval was granted by the commission, and GEB has already started charging FCA from consumers since October 1, 2004. On account of this, SEC has to pay additional money to GEB for purchasing power," an industry source said.

The SEC petition before the GERC is to recover this additional money that it is paying to GEB.

"We are paying FCA to GEB since October 1. Our only aim behind approaching the commission with the petition, seeking approval to charge FCA from our consumers, is to offset the FCA charged by GEB from SEC, ie to recover the extra money that we are paying to GEB," a SEC official said. The official claimed that the petition is in accordance with the directives of the commission.

"When SEC's last tariff was approved, which was around two years back, GERC had made a provision in its order. The provision stated that as and when GEB starts charging FCA from SEC, the company can approach the commission for an approval to the formula under which it can also start charging FCA from its consumers," the official said.

Though the SEC officials have their reasons for defending the move, it has certainly not gone down too well with the local trade & industry bodies.

The Southern Gujarat Chamber of Commerce & Industry (SGCCI), the Surat Vankar Sangh, the Surat Citizens Council, and the Surat Art Silk Cloth Manufacturers Association (SASCMA), have filed petitions before the GERC opposing the SEC petition.

The SGCCI petition states: "The SEC is sourcing power totally from GEB. Therefore any adjustment of fuel cost as far as SEC is concerned, does not arise. So until SEC itself generates electricity, there should be no separate formula for the company, and it should be allowed to collect only the additional burden that has been levied on it due to the FCA by GEB."

"The SEC formula would be acceptable to consumers if it was only to offset the FCA charged by GEB. However, the formula submitted by SEC is an attempt to collect something more than the additional burden levied on it, and should not be approved," the petition added.