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                                                                                                                     Last Edited:Monday, 28 January 2008

                                                                                                                                                  

TARIFF PHILOSOPHY 

 1.The methodologies and procedures for calculating the expected revenue from charges and for calculating estimated costs for determining the tariffs may be provided by the Commission from time to time. The Commission may at any time add, amend, alter, revise, substitute or otherwise change the methodologies and procedures, as the Commission considers appropriate.

2. The Commission may at any time, frame separate Regulations to prescribe the terms and conditions of the determination of the costs, revenue and tariffs in accordance with the provisions of the Act 61 of 2003.

3. Without prejudice to the generality of the powers of the Commission in regulating the tariff, the Commission may keep in view the following while determining the tariff:-
            a. the need to link tariff adjustment to increase in the productivity of capital employed, economical use of resources, good performance, improvement in efficiency of supply and consumption of Electricity to safeguard the interest of the consumers.

            b. the need to rationalize tariffs on the basis of the actual cost of generation, transmission and distribution.

            c. The unbundling of costs which would inform both consumers and potential investors of the cost and revenue stream attributable

 to each functional entity.

            d. The need to transparently provide the appropriate incentives in a non-discriminatory manner, for continuous enhancement in efficiency of generation, transmission and distribution and upgradation in the level of services.

            e. The simulation of competitive conditions where markets do not exists and progressive introduction of competitive conditions.

             f. The least cost adoption of environmental standards.

            g. The need for healthy growth of the industry.

4. (1) The utilities shall provide to the Commission during the period between 15th December to 31st December every year details of its calculation for the ensuing financial year of the expected aggregate revenue from charges based on currently approved tariff by the Commission.

   (2) The details of the calculation of the expected aggregate revenue with such other information and particulars shall be furnished in such form as the Commission may direct from time to time.

  (3) Notwithstanding the above, the Commission shall be entitled to require the Utility to give such other or further information, particulars and documents as the Commission may consider appropriate.

  (4) The Utility shall forthwith supply all the information, particulars and documents directed to be furnished by the Commission.

5. The Utility shall publish the tariff as approved by the Commission in the manner as may be prescribed. The Tariff so published shall be in force until any amendment to the tariff is approved by the Commission and published.

6. All application for amendment of tariff shall be made in such form as the Commission may direct from time to time and the provisions of Chapter-II (of the regulation of the commission) in so far as they are applicable shall apply to proceeding for amendment of tariff.