01 February 2013

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Arvind Kejriwal Expose Delhi Electricity Scam DERC Sudhakar Sheila Dikshit BSES Yamuna BSES RAJDHANI

 Full Details In Depth Arvind Kejriwal Expose Delhi Electricity Scam DERC Sudhakar Sheila Dikshit  BSES Yamuna BSES RAJDHANI

Arvind Kejriwal said that  BJP also knows this.

Electricity was privatized in Delhi in the year 2002.

Distribution losses (including theft of electricity etc.) were very high at that time at 55%. Government claimed that with privatization, these losses would be reduced and when these gains
would be passed on to the consumers, the electricity tariff would come down.
Since then, the distribution losses have actually come down from 55% to 15%.
Where did these gains go? Rather than being transferred to Delhi citizens, the
entire gains have been cornered by the electricity companies.

The electricity prices, rather than being reduced, have more than doubled in the
last three years itself.

Delhi Electricity regulatory Commission (DERC) decides electricity rates in Delhi.
Till 2010, Brijender Singh was the DERC Chairperson. He was known to be honest

Brijender Singh drafted an order in April 2010 in which he concluded that the
DISCOMs were making huge profits and that the electricity tariffs in Delhi should
be reduced by 23% rather than increased.

The power companies had projected Rs 630 crores of losses for the year 2010-11 and they wanted electricity tariffs to be increased to recover that. However, Brijender Singh concluded that they would make profits of Rs 3577 crores, which if passed on to the consumers would result in 73% reduction in tariff. Brijender Singh went to the extent of saying (Annexure  1 }
"
The reduction in tariff is likely to be sustained in the future years as well, since
the energy availability from new power plants is going to increase substantially.

The quantum of surplus energy available for sale is likely to be significantly higher
than the available quantum during FY 2010-11.
This will make available a substantial  surplus in the hands of the petitioner.

 Therefore, the reduction in tariff is appropriate not only for FY 2010-11 but is most likely to continue (or get reduced further ) in subsequent years.
"
The electricity  companies went running to Sheila Dikshit.

 Sheila immediately came to their rescue.

Brijender Singh was supposed to issue the order on 5 May 2010.

Delhi Government wrote a letter to Brijender Singh on 4 May 2010 and stopped
him from issuing his order.


What was Sheila Dikshit's interest in stopping that order? And that too just a
few hours before the order was to be passed


Sheila Dikshit's intervention was challenged by Prashant Bhushan in Delhi High
Court.

Delhi High Court came down very heavily on Sheila Dikshit and directed her
not to intervene in future.

Since by then, more than a year had passed, it directed DERC to pass a fresh order.

Unfortunately, Brijender Singh had retired by then.

Now, Sheila put her own man as DERC Chairperson so that Brijender Singh episode was not repeated. Sheila Dikshit brought in Sudhakar as the new Chairperson of DERC.

He immediately obliged and increased tariffs by 22% in 2011 and by 32% next year.

The  above two actions of Sheila Dikshit completely changed the tariff scenario in
Delhi.

Frauds committed by power companies, repeatedly ignored by Sudhakar

Accounts of the two Anil Ambani group companies, namely BSES Yamuna and
BSES Rajdhani,  are fudged and unreliable.

Whereas Brijender Singh used to take action against these companies, Sudhakar started turning a blind eye on them

Instances from Brijender Singh's period:

1.
 In the year 2008-09, the electricity consumption of Delhi Jal Board and Delhi
Airport were shown to be NIL.

See Annexure 3. This was done to decrease revenue and increase losses.

They were caught by Brijender Singh and in subsequent years, they stopped doing this.

2
Purchase of equipment at higher prices and fraud billing: Between 2004 to
2006, Anil Ambani companies have shown that they purchased equipment
worth Rs 1428, crores from their sister company Reliance Energy Ltd (REL).
When Brijender Singh asked Anil Ambani DISCOMs to produce the records of
REL to see the price at which REL had purchased, they refused to do so saying
that it was a different company and they did not have an access to their
records, whereas the Directors of these companies are almost the same. Then
Brijender Singh checked the VAT records of REL from VAT department of Delhi
Government and found that REL had purchased these equipment at Rs 850
crores.

Why couldn't DISCOMs directly purchase this equipment at that price?

It means that DISCOMs had artificially increased their expenses.

Brijender Singh immediately took action against the companies.

Extracts from Brijender Singh's report are attached at Annexure 4

3.
 Sudhakar found that the two Anil Ambani companies were showing Zero bills
for a number of consumers. A test check found that the e consumers had
actually consumed electricity and paid bills.

 But in the accounts presented before the Commission, they were shown to have Zero Bills. Sudhakar test checked roughly 1% entries of the total consumers and detected that 10% of
the test checked entries were shown to have zero bills.

If such huge fraud was detected, Sudhakar should have either ordered checking of ail entries or
assumed that 10% of DISCOMs entire records were wrong. He did not do either of them. This was a clear case of fraud and cheating. Sudhakar should have registered FIR against these companies. He did not do that also.
See Annexure 5

4.
Till Brijender Singh's time, the companies were showing consistent decrease in
distribution losses. From 55%, the losses came down to 15%. However,
suddenly in Sudhakar's time, the companies started showing substantial
increase in losses.
PI see Annexure 6, which shows that the in Alaknanda circle,
distribution losses decreased during Brijender Singh's period from 16.9% in
2007-08 to 6.29% in 2008-09 to 1.36% in 2009-2010.

However, during Sudhakar's time, the losses suddenly increased to 8.87% next year.
For Nangloi circle, losses increased from 10.97% in 2009-2010 to 19.34% next year.
Out of 21 circles in BSES Rajdhani area, losses increased in 18 circles.
Sudhakar did not even question it and accepted the fudged figures presented by Anil
Ambani companies. Obviously, losses cannot suddenly start increasing in all
circles.

This shows that Anil Ambani companies are taking huge amounts of
revenues out of the books and are showing artificial losses to DERC.
Profits from Sale of surplus power - passed on to consumers by Brijender,
converted into losses by Sudhakar.

DISCOMs had surplus power, which they were selling in market at high prices and
making huge profits thereupon. Brijender Singh found that the DISCOMs were not
showing the entire surplus power and they were showing the sale of surplus
power at low rates

1)    Discom Name – BSES Yamuna

2)Surplus Power available crore unit -  580.00

3)Approved rate by DERC for sale Rs. - 5.75

4)Revenue Generated from sale of surplus power Rs. Crore - 3335.45

5)Net Surplus Rs. Crores. –  977.99

1)    Discom Name – BSES RAJDHANI

2)Surplus Power available crore unit – 896.717

3)Approved rate by DERC for sale Rs. – 5.75

4)Revenue Generated from sale of surplus power Rs. Crore – 5156.12

5)Net Surplus Rs. Crores. – 1027.48

1)    Discom Name – NDPL

2)Surplus Power available crore unit -  643.611

3)Approved rate by DERC for sale Rs. – 5.75

4)Revenue Generated from sale of surplus power Rs. Crore -  3700.77

5)Net Surplus Rs. Crores. – 1572.44

1)    Total  –

2)Surplus Power available crore unit – 2120.328

3)Approved rate by DERC for sale Rs. – 5.75

4)Revenue Generated from sale of surplus power Rs. Crore – 12192.34

5)Net Surplus Rs. Crores. – 3577.91

This surplus revenue of Rs 3577 crores if passed on to the consumers would
reduce tariffs by 23%.

Sudhakar's role:

However, Sudhakar came and reversed the above. Without doing any
verifications, he accepted whatever DISCOMs presented before him:
DISCOMs claimed that the surplus power available was much less than what
Brijender Singh had projected because some new power plants could not start
on time.
However, DISCOMs were lying before Sudhakar. According to the
annual report of Central electricity Authority (CEA), most of these plants have
already started (Annexure 7).

 However, Sudhakar, without verification, readily accepted DISCOMs'
 argument and reduced the quantum of surplus power available.

DISCOMs also pleaded before Sudhakar that the sale price of surplus power
prescribed by Brijender Singh i.e. Rs 5.75 per unit was very high.

Then the question arises - at what price did these companies actually sell surplus
power?

Companies did not produce any records.
The companies said that all transactions took place verbally. Sudhakar accepted that. He observes in his order (Annexure 8) –

"
The petitioner submitted that it had sold short-term power through
bilateral arrangements on the basis of request for offers from traders
(through verbal communication), without following tender process."

 Anil Ambani companies created artificial losses by buying power at high rates
and selling it at much lower rate to its sister concern Reliance energy Trading
Ltd (RETL).

For instance, in 2010-2011, BYPL purchased 405.3 million units of
power from RETL at Rs 2.72 per unit and sold 350.07 million units of power to
RETL at Rs 1.48 per unit, thus creating an artificial loss of Rs 58.66 crores.

Sudhakar closed his eyes to this entire scam.
See Annexure 9.

Therefore, the huge profits projected by Brijender Singh were converted into
losses and tariffs increased substantially by Sudhakar.

CAG Audit –

The above facts show that accounts presented by DISCOMs are fudged.
 They should be audited by CAG.
 Tariffs should not be increased in Delhi without CAG audit, DERC and CAG have been demanding for a long time that their accounts should be audited by CAG.

 However, Sheila Dikshit's permission is required for that and she is not giving permission

Impact of DISCOM's misdeeds on power tariff In Delhi:

1.
 Suppose your electricity bill was Rs 100 in January 2010. In May 2010,
Brijender Singh concluded that your bill should be reduced by 23%. So, from
June 2010, your monthly electricity Bill should ‘have become Rs 77 per month.
Brijender Singh also concluded that this reduction would not only be sustained
but also further reduced in the coming years.

2.
stopped Brijender Singh's order and you continued to pay Rs 100
per month in 2010.

3.
In 2011, Sudhakar increased your tariff by 22%. So, from September 2011, you
started paying Rs 122 per month.

4.
 In 2012, Sudhakar further increased tariff by 32%. So, from July 2012, you
started paying Rs 161 per month.

5.
According to Brijender Singh, you should have been paying much less than Rs
77 per month whereas you are paying Rs 161 today.
This means you are  paying two times the electricity bill, what you should have been paying

In different slab rates, it translates as follows:

1)    Monthly power consumption – 200 units

2)How much should be your 2 months bill as per Brijender – 503 Rs.

3)How much are you actually paying today – 1505 Rs.

4)Excess amount that you have paid to DISCOMs till now – 7910 Rs.

2nd example

1)    Monthly power consumption – 400 Units

2)How much should be your 2 months bill as per Brijender – 2205 Rs.

3)How much are you actually paying today – 4400 Rs.

4)Excess amount that you have paid to DISCOMs till now – 19,493


Demands of  AAP and Indian citizens

1.
Brijender Singh’s tariff order for the year 2010-11 should be implemented and
electricity tariff should be immediately reduced to half.

2.
Tariff orders passed by Sudhakar for the years 2011-12 and 2012-13 should be
scrapped.

3.
The excess money charged from consumers in the last three years should be
refunded to them.

4.
Performance and financial audit of DISCOMs should be done by CAG. Before
such audit, tariff should not be increased in Delhi. And if the DISCOMS do not
cooperate with CAG, their licenses should be cancelled.

5.
FIR should be registered against those DISCOMs who have fudged their
records.

6.
DERC Chairperson should be selected and appointed through a more
transparent and participatory process.

Reality views by sm –

Friday, February 01, 2013

Tags – AAP Arvind Kejriwal  Expose Anil Ambani  Sheila Dikshit Delhi

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12 comments:

MEcoy February 01, 2013  

nice post sm keep it up

Saru Singhal February 01, 2013  

Something good is happening, finally.

Arti February 02, 2013  

Is there any project where we dont have scams. Another good post sm.

DWei February 02, 2013  

Oh wow, things are really hitting the fan.

deeps February 02, 2013  

back to bans....
a topic we cannot do away with..

Pristine February 08, 2013  

Arvind is right but nothing can be done as there is "Cronie Capitalism" the World Bank model of PPP is LEGAL FRAUD as a according to me the PPP stand for Public Private Piracy thus LEGALLY endorsed.Do a little research on the PPP Model major ones are scam creators thu should be abandoned IMMEDIATELY
Vande Matram!.

SM February 27, 2013  

@Pristine

thanks.
yes i agree with you.

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