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Analysis of ARR & Tariff Proposal 2011-12 for SLDC: Insights and Recommendations

This presentation outlines the SLDC's proposed Aggregate Revenue Requirement (ARR) for the fiscal year 2011-12, comparing it with previous ARR proposals. It highlights critical observations and suggestions regarding ARR parameters, including depreciation, operations and maintenance (O&M) expenses, and human resource expenditures. The analysis indicates discrepancies in staffing and spending, urging the Honorable Commission to verify project costs and streamline approvals before finalizing the ARR. The findings stress SLDC's vital role in optimizing power system operation and its impact on electricity costs.

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Analysis of ARR & Tariff Proposal 2011-12 for SLDC: Insights and Recommendations

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Presentation Transcript

  1. Analysis of ARR & Tariff Proposal 2011-12 of SLDC Consumer Counsel

  2. Presentation Outline • SLDC’s Proposed ARR for 2011-12 • Comparison with previous ARR • Analysis, observations and suggestion on ARR parameters • Conclusion

  3. Proposed ARR for 2011-12

  4. Comparison of ARR

  5. Comparisonof Annual SLDC charges

  6. Analysis of ARR and Suggestions

  7. Observations & suggestions Depreciation • An amount of Rs 17.536 lacs towards depreciation of assets in unified Load Dispatch Center & offices in SLDC may be consider in the ARR • However, depreciation claimed towards recovery of total capital expenditure of Rs 294.5 lacs to be spent in 2011-12 shall not be allowed since it is not in line with the provisions under OERC SLDC Regulation, Sept 2010. O&M expenses • The proposed O&M expenses Of Rs 215.78 lacs seems to be on higher side and shall not be approved by the Commission . SLDC could not able to spent the approved O&M charges (201 lacs) in FY 2010-11& therefore the O&M charges shall be computed as per OERC Regulation : 5.72% escalation over actual O&M expenditure of 2010-11

  8. Observations & suggestions Human Resources expenses • Since FY 2009-10, the SLDC is failed to recruit the requisite 86 number of staff to manage the day to day SLDC operations therefore the proposed Human resource expenses of 611.572 lacs for FY 2011-12 shall be approved after verifying the current status of availability of staff at SLDC Interest on Working Capital • Proposed working capital of 264.01 shall be reduced based on the approved O&M & Human resource expenses

  9. Some more observations Non compliance of the direction of Hon Commission

  10. In Conclusion • The SLDC is consider as ‘Brain’ of power system operation. • SLDC is responsible for optimum scheduling and dispatch of electricity, carrying out real time operations for grid control and dispatch of electricity etc.. • Non functioning of SLDC at the full strength will affect the power system operations and increases the cost of electricity. • The SLDC has committing delay in implementing the orders of Hon Commission

  11. In Conclusion • Therefore before approving the ARR of 2011-12 the Hon. Commission should verify the status of work , actual expenditure vis a vis projected cost in previous ARR and avoid the unnecessary items / cost to be pass through in the ARR and to the end consumers • The Commission may consider above facts before approving the ARR for FY 2011-12

  12. Thank You

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