MERC Orders MSEDCL To Follow Rules On Wheeling Charges, Cough Up Refund On Excess Charges

The CERC has directed the MSEDCL to refund the wheeling charges on open access to Sridevi Trading Company, which had filed a petition. The firm had claimed that MSEDCL had levied excess wheeling charges. The Commission has asked MSEDCL to refund the levy on excess amount incorrectly recovered as per it.  In doing this, MERC went back on its own impugned order after APTEL pointed out issues with the calculations as done by MSEDCL.

MSEDCL claim VS CERC order

Back in 2016, the CERC had ordered that the wheeling charges be levied on the basis of actual energy withdrawal at consumption end. The MSEDCL, however, was levying wheeling charges after deducting transmission loss, that is, on the basis of units available for consumption by consumer. The Commission also pointed that the MSEDCL was not levying the wheeling charges when the banked units were adjusted in consumer’s bills.

Taking the example of a 100 units as reference, MSEDCL has levied wheeling charges on 96 units. It maintains that this is justified as 96 units is available for consumption. As per the CERC, on the contrary, the wheeling charge cannot be levied beyond what is calculated as the actual energy withdrawn at the consumption end. Additionally, during calculations, distribution losses have to be considered as well for this.

Computation of wheeling losses

“In an electrical transmission system, the transmission/ wheeling of power is associated with an inherent system loss.” Let’s say, for example, 100 units are injected for wheeling, some units from this will be lost in the process. As a result, the end user will have less than 100 units for consumption.
This loss is technical in nature and is known as copper loss (I^2R). This loss is determined by the magnitude of the current flow in the system and system resistance. It can be known as transmission loss or distribution loss, depending on the system in use.

For example, the wind generation at Satara District is connected to a 33 KV distribution network. This is first linked with the state grid through a transmission substation at 220 KV voltage level.
Let’s say an open access consumer is at Nashik and connected at 33 KV network. The wind injected  could be transmitted through 220 KV transmission network in between. Thus, the distribution network is used twice by the consumer for wheeling its power from injection while the transmission network is used once.

While the distribution loss takes place in the 33kV distribution network, the transmission loss is takes place during the 220kV transmission network.

Both the losses, at distribution and transmission levels are levied only once, instead of twice. The final units resulting from this are set off when energy is being settled by the consumer.

In the example shared, after 100 units are injected, the end user is entitled to receive only 83 units finally, on account of losses. The distribution loss is calculated at multiplying 7.5% by two (as distribution network is used twice by the consumer). The transmission loss is calculated at 3.18%.

                                   33KV                                    EHV 33 KV                                   33KV
Satara Generation ————->    Dist. Loss=7.5%———> Trans. Loss = 3.18%———-> Dist. Loss=7.5%

Mostly, the consumer gets credit of  7 units more, bringing the units total to customer to 90 units. If there is any loss involved, it it to be met by the distribution licensee. In this case, it is MSEDCL.

The CERC uses the following computation to arrive at the balance units credited to the consumer. This also calculates the losses during distribution and transmission.

(a) Units injected: 100
(b) Transmission charges levied on = 100 Units
(c) Transmission loss @ 3.18% deducted, balance units = 96.82
(d) Wheeling charges levied on 96.82 Units
(e) Wheeling loss @7.5% deducted, balance units for credit to consumer =89.55

The same principle applies to surplus (units that are over-injected) energy.

As per regulatory norm, the wheeling charges are to be imposed on the basis of actual energy that is withdrawn at consumption end. As opposed to this, MSEDCL is levying wheeling charges on the basis of the units that remain after the deduction of transmission loss from units injected.
The final units are computed and adjusted against consumption units of the consumer after deduction of wheeling losses. MSEDCL, on the other, is not levying wheeling charges on the unit that is injected. It is levying wheeling charges after the deduction of transmission loss. These are the units available for consumption by consumer.

As per CERC, MSEDCL is not levying wheeling charges when the banked units are adjusted in consumer’s bills. The CERC said it does not find any problem with the computation method of MSEDCL.

But the CERC also notes that any other wheeling charge, which exceeds the actual energy withdrawn for consumption by user cannot be added. It added that actual energy withdrawn for consumption by user should take into account the transmission and distribution losses.

Thus, the CERC has directed the MSEDCL to make refund to Sridevi Trading Company for any excesses charged by MSEDCL on the firm.