Uttar Pradesh: Discoms asked to adjust interest on security deposit in electricity bills

Lucknow: Power consumers’ long wait to get the bank interest on their security deposits that they paid to the UP Power Corporation Ltd (UPPCL) while taking an electricity connection seems to be over now.

The UPPCL has finally set in motion the process of feeding the amount of the security deposits in official records and then start paying the same to them, albeit, in a staggered manner.

UPPCL managing director Pankaj Kumar has written to all the five state-owned discoms asking them to immediately start feeding consumer’s security deposit amount in computers and start adjusting the same in the electricity bills as per the formula chalked out by the Board of Director on July 29, 2021.

According to an estimate, in UP there are around 50 lakh power consumers whose security deposit data have not been fed and never got annual interest payable to them since 2003 when the Electricity Act came into being mandating discoms to pay interest on the security deposit at the prevailing RBI bank rate or more once a year. The UPPCL has not been regular and consistent in paying the interest to other consumers as well.

Kumar, in his circular dated October 21, has asked the discom MDs to ensure that the data related to amount of security deposit of 12,10,698 consumers who subscribed to an electricity connection prior to 1993 was entered into official records at the division level within next two months.

“Discoms will also ensure feeding of the security deposit amount of 37,94,465 consumers having electricity connections of 2kw and below within two months,” he added.

The MD further said that there were 29,725 consumers using power load above 10kw. “These are the consumers whose power connection date is fed, but the security deposit amount is not fed. Discoms must see to it that the interest amount is calculated in respect of all such consumers,” he said, asking discoms to rectify another 16,028 consumers’ inflated security deposit amount.

Welcoming the UPPCL’s move, UP Rajya Vidyut Upbhokta Parishad, chairman Awadhesh Kumar Verma, who filed several petitions in the UP Electricity Regulatory Commission (UPERC) demanding payment of interest to consumers, said, “It is a good decision that will enable lakhs of power consumers to get their lawful due.”

A year ago, the consumers’ consolidated security deposits which the five discoms had together stood at ₹3,164.03 crore in 2019. The commission, a few months ago, had also passed an order asking the UPPCL to pay interest on security deposits and warned of action in the event of non-compliance.

Security deposit that is refundable on surrender of the power connection is charged, in the case of domestic consumers, at the rate of ₹300per kw. The amount is much higher in case of commercial and industrial consumers.