Multipoint and its 'direct connections' - PART 1
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Multipoint and its 'direct connections' - PART 1

The writer elaborates on all the key points pertaining to the issues related to multipoint power connections, which proved to be a bone of contention between the builders and the residents living in high-rises.

Multipoint and its 'direct connections' -  PART 1

By changing its previous rule, the Uttar Pradesh Electricity Regulatory Commission (UPERC) has dismissed all the possibilities of providing relief to the residents of high-rises who were already considering themselves as 'bonded labours' to the unruly builders.

Following the complaints made by residents of multi-storey apartments against the builders for charging exorbitantly in the name of power charges, the UPERC, a few years back, made a rule stating the distribution companies (discoms) of the state must give multipoint connections in the flats by March this year. In this regard, the power body gave directions to form a system, rules, and management so that the consumers can be benefitted from it.

Afterwards, all the discoms including the Paschimanchal Vidyut Vitaran Nigam Limited (PVVNL) directed the builders to develop the whole system and hand over their power systems to them. But this order given prior to 2-3 months of the implementation was merely a 'formality' and nothing else.

Builders' claim of 'investing' in power infra baseless

As expected, the builders did not take any steps towards it. They put forth their views in front of the discoms stating that their power systems cannot be separated. Besides, builders defended their statement saying that they have invested crores of rupees in developing these systems, hence it is unacceptable to them to hand it over to the distribution companies.

The builders further said that if the discoms want to provide direct connections to the consumers, they can develop their own systems. The officials of the discoms, who were already not in favour of giving direct connections, took an anti-consumer stand following the arguments made by the developers.

As a matter of fact, the very statement by the builders claiming that they invested in developing power systems is 'baseless' because they charged the residents heavily with which they developed these systems besides making huge profit out of it. This is a sheer violation of the terms and conditions laid by the UPERC and discoms, according to which the builders were allowed to charge the consumers on 'no profit no loss' basis.

Charging extra for setting up infra 'unjust'

When the builders started dodging to make required changes, the discoms officials apprised the residents and the welfare associations like RWA and AOA that they are ready to provide direct connections provided they bear the cost of setting up a power system. An amount of Rs 50,000-60,000 or above per flat was estimated. Sensing the financial burden, residents had no option than remaining silent on this issue.

Violation of 'No Profit No Loss' rule

Builders were allowed to charge consumers on no profit no loss basis. In that case, why the builders were not told to include the cost of power systems within the cost of flats. By doing this, the mentioned cost would have automatically got adjusted in accordance with the nominal rise in the rate of flats in comparison to the market price. Having said that, the rule of charging the residents as per the fixed rate set by the discoms could have been applied.

Moreover, there is a huge difference in the charges accepted by the builders and the fee set by discoms to get power connections. On one hand where a builder charges somewhere between Rs 1-1.5 lakh, the fee charged by discoms comes up to Rs 3000-5000, as per load. It is agreed that the cost of setting up a power system is included in the builders' charge but charging fee 30-40 times more is not at all justified.

But the terms and conditions were laid in such a manner that despite having no profit no loss rule, the builders and the discoms were deliberately allowed to make a huge amount of money.

UPERC and its 'voluntary' cognisance?

Due to this connivance, the discoms, and the builder got the chance to make favourable changes in the multipoint power connections. The UPERC was informed about the budget following which a plan to amend the rules was made. What is interesting here is the fact that the UPERC acted upon the 13th amendment of the Electricity Supply Code, 2005 by taking the cognisance itself and not on the basis of any complaint. It means that neither the discoms nor the builders officially objected to the previous rule.

But what made UPERC take such cognisance and change the rule? Follow City Spidey to know more in the second part.

(Disclaimer: The writer is a senior business journalist residing in Crossings Republik, Ghaziabad. City Spidey neither endorses it nor is responsible for the same.)