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Rs456 crore loss shocks BEST power division

By DNA Correspondent | Place: Mumbai | Agency: DNA

The power supply division of the Bombay Electric Supply and Transport (BEST) suffered a Rs456.03 crore loss in the financial year 2011-12, according to the municipal chief auditor’s report which was released recently. The undertaking’s officials, however, call it a revenue gap which can be recoverable in the current financial year.

“We faced a similar situation in 2007-08 and 2008-09, but we were able to recover the revenue gap in the following years. The supply department never faced power losses in its history except for these three instances,” an official from the undertaking’s supply department said. The electric supply wing, in fact, made a Rs206.86 crore profit in 2010-11.

“The state power regulator, MERC, prevented us from hiking power tariff and therefore, even the supply division is facing losses,” said Ashok Patil, BEST chairperson. Apart from the losses, BEST also faces bad debts of Rs392 crore which are yet to be recovered.

“The cost of buying power on a wholesale basis has increased, but there is no increase in the power tariff. Besides, MERC cut power tariff by 15% in September 2010 and it was applicable till May 2012. This is the main reason for the loss,” the report said.
The Rs456.03 crore figure is greater than the combined losses (Rs342 crore) suffered by BEST’s transport division in 2007-08 and 2008-09. The transport wing also suffered a Rs319.73 crore loss in 2011-12.