IIT Powai exposes excess billing scam in MSEDCL

Nagpur: Even as MSEDCL is grappling with the revelations of the report of Maharashtra Electricity Regulatory Commission’s (MERC’s) working group on agricultural power consumption, TOI has got hold of a report prepared by IIT Powai that had exposed excess billing by the discom in 2017.
According to IIT Powai’s study, agricultural power consumption in the state is only around 55% of that claimed by MSEDCL.This implies that MSEDCL has indulged in jugglery of thousands of crores in the last fifteen to twenty years.
When Chandrashekhar Bawankule of BJP became the energy minister, he received several complaints of excess billing of farmers. He had constituted a fact-finding committee in July 2015 to look into the complaints. The committee asked IIT Powai to determine the consumption by doing a survey across the state. The committee was headed by MSEB Holding Company director Vishwas Pathak and had power experts Pratap Hogade and Ashish Chandarana as members. MSEDCL is governed by the Holding Company.
The revelations of IIT’s study were so damaging that Pathak refused to sign the report of the fact finding committee. The report was submitted to the Holding Company in July 2017 with the signature of only Hogade and Chandarana. The Company has not taken any action on the report since then.
Pathak admitted that he had refused to sign the report. “Hogade and Chandarana were more interested in publicity. They refused to take into account the positive things being done by MSEDCL by using technology. I therefore prepared a separate report and submitted it to the Holding Company. Mine was accepted while theirs was rejected,” he told TOI. He, however, accepted that the Company had not acted on his report too.
Bawankule refused to comment on why no action was taken on the report despite repeated calls and text messages for three days. Incumbent energy minister Nitin Raut said that he was not aware of the existence of the report.
The committee in its report concluded that the estimated agriculture power sale was 15,093 million units (MU) against 25,685 MU (58.76%) reported for 14-15 by MSEDCL and 14,973 MU against 27,505 MU (54.43%) reported for 2015-16.
IIT’s figure is on the higher side, which is evident from the assumptions made by it. IIT calculated low tension (LT) distribution loss at 23% but considered 25% for the sake of calculations. It states that agricultural feeders get power for 8 to 10 hours a day but 12 hours was being considered. It has been assumed that agricultural pumps work for 300 days a year. This assumption is fallacious as pumps work for 300 days only in irrigated areas. Most of the state has dryland agriculture where the third crop is not possible due to unavailability of water. If these factors are taken into account, MSEDCL’s inflation of sales figures is higher than that calculated by IIT.
Hogade alleged that MSEDCL indulged in this jugglery to conceal its massive failure in curbing power theft. “Had MSEDCL actually brought down distribution loss to 15%, our power tariff would have been considerably lower,” he told TOI.
The fact finding committee had recommended that “Considering the higher percentage of losses observed by the IIT and the committee, it is necessary that any unauthorized use of power and theft of power should be strictly prohibited and should be treated strictly in accordance with the law. The committee recommends that the regular theft detection drive should be taken by the MSEDCL to reduce the losses on this account.”
The committee also stated that “For the purpose of tariff hike petitions, agricultural connected load as per MSEDCL data is considered. Attempting to justify higher consumption hours, high unauthorized and illegal load under the ambit of agricultural sales and thereby claiming direct subsidy from state government and cross subsidy from the rest of the subsidizing consumers is unfair and unlawful practice. In our view, it needs to be avoided and stopped fully within minimum possible period. Appropriate authority can take suitable decision in this regard.”
IIT Powai has observed in its report that MSEDCL’s method of estimating agricultural power consumption has been faulty right from the beginning. “There has been no convergence over the years to a reliable methodology to calculate agricultural consumption. The method followed by the Commission in 2006-07 had already thrown up very unreliable metering data. The current situation may be worse as observed from the preliminary field data and from some analysis of metering data of Nasik and Aurangabad zones.”