MERC orders probe into RInfra D business

Regulator Says The ADAG Co Has Not Furnished Power Purchase Agreements Our Political Bureau MUMBAI   THE state power regulator Maharashtra Electricity Regulatory Commission (MERC) on Tuesday ordered investigations into business affairs of RInfra D, the distribution arm of Reliance Power, the Anil Dhirubai Ambani group company.      In a report, the regulator said the absence of power purchase agreements is responsible for the high cost of power provided by the company, adding it has not submitted the agreements to the Commission till date, despite a statutory provision in this regard.      The regulator has appointed the Hyderabad-based Administrative Staff College of India (ASCI) as an investigating agency in this regard and has directed the company to co-operate with it, besides supplying the relevant documents.      ASCI will look into the information provided by the company from its former avatar as BSES and Reliance Energy. ASCI has been asked to submit its report in 16 weeks' time.      The MERC order has come in response to the state's petition requesting a review of the tariff hike it had granted to RInfra D in June this year. Following this, the regulator studied RInfra D functions and submitted its report to the state government in July. "The Commission has reason to believe that there is a need to order an investigation into power purchase transactions, the accuracy of electronic meters installed by RInfra D, the steep increase in capital expenditure being undertaken by RInfra D and the related books of accounts," the report said.      The Commission has powers under Section 128 of the Electricity Act 2003 to conduct an investigation into the functioning of the licensee and generating company.      Although RInfra D has, during previous tariff determination processes submitted a brief affidavit stating that it does not have any other income, "it is necessary, in view of the steep rise in the costs of RInfra D, to undertake a detailed item-by-item examination of the various expense and revenue heads," the regulator says in its order.      This is necessary "to ensure that expenses of other businesses are not being passed on to consumers," it said. It also wants to ensure that "the assets being reported under its regulated business are actually physically existing and are being used for the benefit of the business".      The investigating authority will "scrutinise petitions, record of proceedings, minutes of meetings and data submitted to the Commission by RInfra Distribution Business, including the data submitted by the erstwhile BSES and Reliance Energy in the period from April 1, 2003 to March 31, 2009 and to report to the commission regarding discrepancy, if any."  POWER CHECK  MERC order has come in response to the state's petition requesting a review of the tariff hike it had granted to RInfra D  The regulator said the absence of power purchase agreements is responsible for the high cost of power provided by the company  MERC has appointed Hyderabad-based ASCI to investigate into the matter  ASCI to look into the information provided by the company from its former avatar as BSES and Reliance Energy