retail

The Odisha Distribution & Retail Supply Licence 1997 (No. 1/97)

ANNEXURE 'A'

Licence for the Supply of electricity granted by the Orissa Electricity Regulatory Commission under Section 15 of the Orissa Electricity Reform Act, 1995 (2 of 1996) to GRID CORPORATION OF ORISSA LIMITED JANPATH, BHUBANESWAR - 751 007 (GRIDCO) for carrying, out the business of Distribution and Retail Supply of electrical energy within the Area of Supply and with the powers and upon the terms and conditions specified below.

TABLE OF CONTENTS:

PART I: Terms of the Licence

1. Short Title

2. Definition

3. Term of Licence

PART II: General Conditions

4. Regulations

5. Prohibited Activities

6. Prohibition of Subsidies among Separate Businesses

7. Separate Accounts for Separate Business

8. Prohibition of Discrimination and Undue Preference

9. Provision of Information to the Commission

10. Disposal of Assets

11. Payment of Fees

12. Terms as to Revocation

13. Dispute Resolution

14. Indian Electricity Act, 1910 (9 of 1910) & Indian Electricity (Supply) Act, 1948 (54 of 1948)

PART III: Technical Conditions

15. Compliance with the Grid Code

16. Compliance with Distribution Code

17. Distribution System Planning and Security Standards and Operating Standards and Standards of Performance

18. Investment

19. Obligation to Connect Consumers

20. Obligation to Supply and Power Supply Planning Standard

21. Consumer Service

PART IV: Tarrifs

22. Basis of Charges

23. Provision of Subsidies to Certain Consumers

PART V: Competition Conditions

24. Introduction of Competition in Bulk Supply

25. Power Procurement Procedure

PART VI: Penalty

26. Penalty for contravention of provisions of the Licence

Schedule I: Area of Transmission and Bulk Supply

PART I: TERMS OF THE LICENCE:

1. Short Title:
1.1. This licence may be called "The Orissa Distribution and Retail Supply Licence 1997 (1/97)"

2. Definition:
2.1. The words, terms and expressions to which meanings are assigned by the Orissa Electricity Reform Act, 1995 (2 of 1996) and rules and regulations made thereunder, shall have the same meanings in this licence.
2.2. Words, terms and expressions used in this licence which are not defined in this licence, or in the Orissa Electricity Reform Act 1995 (2 of 1996) shall have the meanings given to them in the Indian Electricity Act, 1910 (9 of 1910) and the Electricity (Supply) Act, 1948 (54 of 1948).
2.3. In this license unless the context otherwise requires:

"Act"	means the Orissa Electricity Reform Act, 1995 (2 of 1996)
"Affiliate"	means in relation to the Licensee, any Holding company or Subsidiary of the Licensee, or any Subsidiary of a Holding Company of the Licensee
"Area of Supply"	means the geographic area referred to in Schedule I of this Lieence within which any activity Authorised by this licence is allowed
"Auditors"	means the licensee's auditors for the time being holding office in accordance with the requirements of Sections 224 to 234A of the Companies Act 1956 (1 of 1956)
"Authorised"	in relation to any business or activity means authorised by licence granted under Section 15 or exemption granted under Section 16 of the Act
"Bulk Supply"	means the provision of electricity to a Licensee for resale
"Bulk Supplier"	means any person who is Authorised to carry out Bulk Supply
"Bulk Supply Business"	means the Authorised business of a Licensee in Bulk Supply
"Consumer"	means the end or final user of electricity
"Customer"	means any Electricity Operator supplied with electricity for resale
"Distribution"	means the transportation of electricity by means of a Distribution system
"Distribution and Retail Supply Business"	means any Authorised business of the licensee (i) in or ancillary to Distribution (whether for its own account or that of third parties) through any system owned and/or operated by the Licensee and (ii) the Retail Supply of electricity to Consumers
"Distribution code"	means in relation to any Distribution and Retail Supply Licensee, the code covering all material technical aspects relating to connections to the Distribution System owned and/or operated by the Licensee planning conditions to be applied by the Licensee in the development of the distribution System. and (in so far as relevant to the operation and use of the Distribution System) the operation of electric lines and electrical plant connected to the Licensee's Distribution System or the Distribution System of any Licensee
"Distribution System"	means any system consisting of mainly of cables service lines and overhead lines, electrical plant and meters having design voltage of 33 KV and under, owned and/or operated by a Distribution and Retail Supply Licensee and used for the transportation of electricity from a Transmission System or Generating Sets or other points to the point of delivery to Consumers and includes any electrical plant and meters owned and/or operated by the Licensee in connection with the Distribution of electricity. The Distribution system shall not Include any part of a Transmission System. except where used for the Supply of electricity to a single Consumer or group of Consumers
"Electricity Operator"	means any person who owns and/or operates generating plant or who holds a licence under Section 14 of the Act, connected to the Licensee's transmission system and any Bulk Supplier
"Generating Set"	means any plant or apparatus for the production of electricity and shall where appropriate include a generating station comprising of more than one generating unit
"Generator Interconnection Facilities"	means any transformers, busbars, switchgear, plant or apparatus utilised to enable access to a Transmission / Distribution System by the Generating Sets
"Grid Code"	means the code covering all material technical aspects relating to connections to and the operation and use of a Transmission System or (in so far as relevant to the operation and use of a Transmission system) the operation of electric lines and electrical plant connected to the Transmission system or the Distribution System of any Electricity Operator including the Licensee's Transmission system
"Licensee"	means The Grid Corporation of Orissa Limited constituted under Section 13 of the Act
"Licensee's Distribution System"	means any Distribution system owned and/or operated by a Distribution and Retail Supply Licensee
"Licensee's transmission System"	means the a Transmission system of the Transmission & Bulk supply License
"Operating Standards"	means the standards approved by the commission pursuant to Condition 17
"Overall Performance Standards"	means the standards as may be determined by the Commission pursuant to Section 34 of the Act
"Planning and Security Standards"	mean the standards referred in Paragraph 17.1(a) of Conditin 17 approved by the Commission;
"Regulations"	means Regulations issued by the Commission under Section 54 of the Act
"Retail Supply"	means sale of electricity to Consumers
"Separate Business"	means each of the Distribution and Retail Supply Business, the Transmission Business, the Bulk Supply Business, and any Commission authorised non core activity taken separately from one another and from any other business of the Licensee or any affiliate of the Licensee
"Standards of Performance"	means such standards of performance as may be determined by the Commission pursuant to Section 33 of the Act
"Supplier"	means any Electricity Operator who carries out or provides Bulk supply or Retail Supply
"Supply"	means the provision of electricity either for resale or directly to Consumers
"Transmission Business"	means the Authorised business of a Licensee in Transmission
"Transmission System"	means the system consisting of extra high voltage electric lines having design voltage of 66 KV and higher owned and/or operated by a Licensee Authorised to transmit electricity for the purposes of the transportation of electricity from one power station to a substation or to another power station or between sub-stations or to or from any external interconnection including 33/11 KV bays/equipment up to the interconnection with the distribution system, any plant and apparatus and meters owned or used in connection with the transmission of electricity, but shall not include any part of a Distribution System

3. Term of Licence:
3.1. The Commission in exercise of the powers conferred by Section 15 of the Act hereby grants to the Licensee licence to distribute and Supply at retail, electricity to any premises in the Area of Supply set out in Schedule 1 of this Licence during the period specified in Paragraph 3.3 subject to the conditions set out in Parts II, III, IV, V and VI of this licence.
3.2. The Conditions are subject to modification or amendment in accordance with their terms, the provisions of Condition 24 or with the provisions of the Act.
3.3. This licence shall come into force on First of April 1997 and unless revoked earlier shall remain in force for 30 years from date of issue and may, upon agreement of the Commission and the Licensee, be renewed for another period of 20 years.
Provided that the period of licence may be reduced by revocation/amendment consequent of divesting of the Distribution and Retail Supply business in respect of any part of the Area of Supply by the Licensee.

PART II: GENERAL CONDITIONS:

4. Regulations:
4.1. The Licensee shall comply with, adhere to, and obey the Orissa Electricity Regulatory Commission Regulations, directions and orders as may be issued by the Commission thereunder.

5. Prohibited Activities:
5.1. In the State of Orissa, neither the Licensee nor any of its Affiliates shall:

purchase or import or otherwise acquire electricity from any person, unless that person has a Transmission and Bulk Supply Licence or is a generator with installed capacity of five MW or less; or
sell or otherwise dispose of electricity to any person other than pursuant to its Distribution and Retail Supply Business; or
own, hold any beneficial interest in, or operate any Generating Set or other sources of production of power in the Area of Supply except in a manner which in the opinion of the Commission is incidental to its Authorised business; or
own, hold any beneficial interest in or operate any facilities for the Transmission and Bulk Supply or Distribution and Retail Supply of electricity other than pursuant to the carrying on of its Transmission Business, Bulk Supply Business and its Distribution and Retail supply Business respectively; or
provide services to third parties for the transportation of electricity through the Licensee's Distribution System, unless Authorised to do so by the Commission; or
start any non-core activity, unless specifically authorised by the Commission provided that such non-core activity shall be treated for the purposes of Condition 7 as a Separate Business.

5.2. The Distribution and Retail Supply Business shall not be held by or carried on through any Affiliate of the Licensee, unless otherwise permitted by the Commission.
5.3. The Licensee shall not guarantee any obligation incurred by nor make any loans to an Affiliate of the Licensee in respect of a non-core activity. In carrying on the Distribution and Retail Supply Business, the Licensee shall not make any loan or loans to any other Separate Business of the Licensee or an Affiliate of the Licensee.
5.4. The Licensee shall not create or permit to subsist any encumbrance in favour of any other person over any of the Licensee's assets for the purpose of securing any obligation of any other person or of the Licensee in relation to any non-core activity.
5.5. For the purposes of Paragraphs 5.3 and 5.4 the terms "encumbrance" and "non-core activity" shall have the following meanings:

"encumbrance"	means any mortgage, charge right of possession, assignment by way of security or other form of security interest
"non-core activity"	means any activity of the Licensee or an Affiliate of the Licensee other than that carried on as part of the Distribution and Retail Supply Business

6. Prohibition of Subsidies among Separate Businesses:
In respect of each Separate Business the Licensee shall not, without prior permission of the Commission, give any subsidy to or receive any subsidy from any other Separate Business or from any other business of the Licensee or any Affiliate of the Licensee.

7. Separate Accounts for Separate Businesses:
7.1. The first financial year of the license shall run from First of April 1997 to Thirty first of March 1998 and thereafter each financial year of the license shall run from First of April to the following Thirty First of March.
7.2. The Licensee shall in respect of each Separate Business (whether or not carried on by a separate company:

keep such accounting records as required by the Commission to be kept in respect of each such Separate Business if it were carried on by a separate company, so that the revenues, costs, assets, liabilities, reserves, and provisions of, or reasonably attributable to, each Separate Business are separately identifiable in the books of the Licensee from those of any other Separate Business or other business; and
prepare on a consistent basis from such accounting records:
1. for each financial year account statements comprising a profit and loss account, a balance sheet and a statement of source and application of funds together with notes thereto and showing separately in respect of each Separate Business the amounts of any revenue, cost, asset, liability, reserve, or provision which has been either:
  (A) charged from or to any other business (whether or not a Separate Business) together with a description of the basis of that charge, or
  (B) determined by apportionment or allocation between any Separate Business and am other business (whether or not a Separate Business) together with a description of the basis of the apportionment or allocation, and
2. In respect of the first six months of the first financial year and of each subsequent financial year an interim profit and loss account, and
provide, in respect of the accounting statements prepared in accordance v, with this Condition 7, a report in respect of each financial Year, by the Auditors, stating whether in their opinion those statements have been properly prepared in accordance with this Condition 7 and give a true and fair view of the revenues, costs, assets, liabilities, reserves and provisions of, or reasonably attributable to the Separate Business to which the statements relate, and
deliver to the Commission a copy of each interim profit and loss account not later than three months after the end of the period to which it relates, and copies of the accounting statements and auditor's report not later than six months after the end of the financial year to which they relate.

7.3. Unless permitted to do so by the Commission. the Licensee shall not change the bases of charge or apportionment or allocation referred to in sub-paragraph (b)(i) of Paragraph 7.2 in relation to the accounting standards in respect of a financial year from those applied in respect of the previous financial year.
7.4. Where in relation to the accounting statements in respect of a financial year the licensee proposes to change such bases of charge or apportionment or allocation from those adopted for the immediately preceding financial year the Licensee shall, if requested by the Commission in addition to preparing accounting statements on those bases which it proposes to adopt, also prepare such accounting statements on the bases which applied in respect of the immediately preceding financial year.
7.5. Accounting statements in respect of a financial year prepared under sub-paragraph (b)(i) of Paragraph 7.2 shall, unless otherwise approved or directed by the Commission:

keep such accounting records as required by the Commission to be kept in respect of each such Separate Business if it were carried on by a separate company, so that the revenues, costs, assets, liabilities, reserves, and provisions of, or reasonably attributable to, each Separate Business are separately identifiable in the books of the Licensee from those of any other Separate Business or other business; and
state the accounting policies adopted; and
(with the exception of the part of such statement which shows separately the amounts charged, apportioned or allocated and describes the bases of charge or apportionment or allocation respectively), be published with the annual accounts of the licensee in the manner prescribed in the Regulations.

7.6. References this Condition 7 to costs or liabilities of or reasonably attributable to any Separate Business shall be construed as excluding taxation, capital liabilities which do not relate principally to that Separate Business and Interest thereon.
7.7. The licensee shall ensure that the accounting statements in respect of each financial year prepared under sub-paragraph (b)(i) of Paragraph 7.2 and the Auditor's report in respect of each financial year referred to in sub-paragraph (c) of Paragraph 7.2 are made available to any person requesting them at a price not exceeding fair copying charges.

8. Prohibition of Discrimination and Undue Preference:
8.1. Discrimination:
Except where directed by the State Government under the terms of Sections 22A and 22B of the Indian Electricity Act, 1910 (9 of 1910) and Section 12 (3) of the Orissa Electricity Reform Act 1995, the Licensee shall not, and shall ensure that any Affiliate of the Licensee shall not, Supply or sell or offer to Supply or sell electricity to any one Consumer on terms which are materially more or less favorable than those on which it supplies or sells or offers to Supply or sell electricity to comparable Consumers. For the purposes of assessing comparability due regard shall be given to the circumstances of Supply or sale to such Consumers including quantity load factors power factor. level and timing of peak demand and duration of the agreement, or any other relevant factors.
8.2. Undue Preference:
Tariff differentials existing at present between Consumers which do not reflect differences in the circumstances of supply or sale to such Consumers including quantity, load factor, power factor, level and timing of peak demand, conditions of interruptability and duration of the agreement, or any other relevant factors shall be phased out by the Licensee over such period as the Commission shall approve in respect of such tariff differentials in accordance with the following procedure:

Within 180 days of the date of the issue of this licence, the Licensee shall submit to the ommission a plan for the phasing out of such tariff differentials over a specified period of time;
the Commission shall accept such plan or require modifications to it; and
the Licensee shall reduce tariff differentials in accordance with the plan or modifications to it approved by the Commission

9. Provision of Information to the Commission:
9.1. The Licensee shall supply to the Commission in the manner and at the times specified by the Commission such information as the Commission may direct.
9.2. Without prejudice to the generality of Paragraph 9.1, the Commission may require the Licensee to supply accounting information which is more extensive than or differs from that required to be prepared and supplied to the Commission under Condition 7 or which shall be required by the Government of India or the Government of Orissa.

10. Disposal of Assets:
10.1. The Licensee shall not dispose of or relinquish operational control over any land and building of whatever value and any other assets with replacement cost in excess of Rs. 30 lakh otherwise than in accordance with following paragraphs of this Condition 10.
10.2. Save as provided in Paragraph 10.3 the Licensee shall give to the Commission not less than two months' prior written notice of its intention to dispose of or relinquish operational control over any asset. Notice shall not be deemed to have been given until such time as the Licensee has provided to the Commission all such further information as the Commission may require.
10.3. Notwithstanding Paragraph 10.1, the Licensee may dispose of or relinquish operational control over any asset as is specified in any notice given under Paragraph 10.2 if:

the Commission confirms in writing that it consents to such disposal or relinquishment subject to such condition as the Commission may impose; or
the Commission does not inform the Licensee in writing of am objection to such disposal or relinquishment of control Within the notice period referred to in Paragraph 10.2.

10.4. Notwithstanding Paragraphs 10.1 and 10.2, the Licensee may dispose of or relinquish operational control over any asset:

where:
1. the Commission has issued directions for the purposes of this Condition 10 containing a general consent (whether or not subject to conditions) to:
  (i) transactions of a specified description, and/or
  (ii) the disposal of or relinquishment of operational control over assets of a specified description; and
2. the transaction or the assets are of a description to which such directions apply and the disposal of or relinquishment is in accordance with any conditions to which the consent is subject; or
under such contracts agreements executed before the commencement of this Licence; or
where the disposal or relinquishment of operational control in question is required by or under any enactment or subordinate legislation.

10.5. In this Condition 10 "Disposal" includes any sale, gift, lease, licence, the grant of any right or possession (or ownership whether immediate or in the future), transfer of ownership loan, security, mortgage, charge or the grant of any other encumbrance or the permitting of any encumbrance to subsist or any other disposition to a third party; and "dispose" shall be construed accordingly.

11. Payment of Fees:
11.1. Within 30 days, or such other period as the Commission may allow after the coming into force of this licence the Licensee shall pay to the Government of Orissa an initial annual fee of Rs.100 lakh.
11.2. For each subsequent year that this licence remains in force, the Licensee shall by 10th of April of every year, be liable to pay to the Government of Orissa an annual licence fee of Rs.100 lakh. The Commission shall review and may change the level of such fee every three years.
11.3. Where the Licensee fails to pay to the Government of Orissa any of the fees due under Paragraph 11.1 or 11.2 by the dates specified,:

the Licensee shall be liable to pay to the Government of Orissa interest on the outstanding amount at a simple interest rate of 2% per month, the interest being payable for the period beginning on the day after which the amount becomes due, and ending on the day on which the Government of Orissa receives payment, and
the Licensee shall be subject to the proceedings for the recovery of such fees specified in the Act, and
the Commission may revoke this licence pursuant to Section 18 of the Act and Condition 12 of this licence.

11.4. The Licensee shall be entitled to reflect any fee paid by it under this Condition in the determination of aggregate revenues made in accordance with Condition 22.

12. Terms as to Revocation:
The Commission may, provided that the requirements of Section 18(4) of the Act have been satisfied at any time revoke this licence by not less than 3 months notice in writing to the Licensee:

on the application of the Licensee or with the consent of the Licensee provided in each case that the requirements of Section 18(3) of the Act have been satisfied; or

if any amount payable under condition 11 is unpaid after it has become due and remains unpaid for a period of 30 days and such other time as the Commission may specify; or

if the Licensee has breached any conditions of this licence and does not comply with an order of the Commission to rectify such breach; or

if the Licensee fails to show to the satisfaction of the Commission within 30 days of a request from the Commission that the Licensee is in a position to full and efficiently discharge the duties and obligations imposed on the Licensee by this licence; or

if, in the opinion of the Commission the Licensee's financial position is such that the Licensee is unable fully and efficiently to discharge the duties and obligations Imposed on the licensee by this licence or

if in the opinion of the Commission the Licensee has committed a willful or unreasonable default in doing anything required of it under the Act, the Indian Electricity Act, 1948 (9 of 1910) or the Indian Electricity (Supply) Act 1948 (54 of 1948) or rules made thereunder.

12.2. Where assets of the Licensee used in the Distribution and Retail Business or the Supply Business are transferred to another entity, pursuant to a sale. purchase or lease of assets, this licence may be amended by the Commission accordingly with regard to the area of supply.

13. Dispute Resolution:
Notwithstanding anything contained in the Arbitration Law, the Commission shall have the power to act as arbitrator or to nominate an arbitrator or arbitrators to adjudicate and settle disputes arising between the Licensee and any other person who is the holder of a licence pursuant to the Act and issues relating to the Licensee arising under Section 33 of the Act in accordance with the Act and the Regulations to be prescribed pursuant to the Act.

14. Indian Electricity Act, 1910 (9 of 1910) and Indian Electricity (Supply) Act, 1948 (54 of 1948):
14.1. Except as otherwise provided herein none of the clauses of the schedule to the Indian Electricity Act, 1910 (9 of 1910) shall be incorporated into this Licence.
14.2. The Licensee shall, before commencing to lay down or place a service-line in any street in which a distribution main has not already been laid down or placed, serve upon the local authority (if any) and upon the owner or occupier of all premises abutting so much of the street as lies between the point of origin and termination of the service line to be laid down or placed, 21 days notice stating that the Licensee intends to lay down or place a service line and confirm that, if within the 21 days period the local authority or any one or more of such owners or occupiers require in accordance with Condition 16 that a supply shall be given for any public lamps or to their premises (as the case may be), the necessary distributing main will be laid down or placed by the Licensee at the same time as the service line.
14.3. Where after distributing mains hare been laid down under the provisions of Paragraph 14.2 or Clause VI of the schedule to the Indian Electricity Act. 1910 (9 of 1910) and the supply of energy through those mains or any of them has commenced, a requisition is made by the State Government or by a local authority requiring the Licensee to supply for a period of not less than seven years energy for any public lamps within the Area of Supply, the Licensee shall supply and save in so far as it is prevented from doing so by cyclones, floods, storms or other occurrences beyond his control, continue to supply energy for such lamps in such quantities as the State Government or the local authority as the case may be, may require. The State Government or the relevant local authority, as the case may be, may require the Licensee

to provide the mains and other equipment for public lamps; and

to use for that purpose supports, if any previously erected or set up by him for supply of energy.

14.4. The Licensee may charge any cost reasonably incurred in carrying out works pursuant to Paragraphs 14.2 and 14.3 to the Government of Orissa or to the relevant local authority, in accordance with a procedure approved by the Commission and in accordance with the requirements of the Act and any rules or Regulations made pursuant to the Act.
14.5. The Licensee shall provide an Electrical Inspector or person authorised by an Electrical Inspector (hereinafter referred to in this Condition 14 as the "authorised person") with facilities for inspecting and testing the Licensee's works and for the reading, testing or inspection of any instrument. A person appointed by the Licensee may be present at the testing of its works or the reading, testing or inspection of any instruments, but shall not interfere with the reading testing or inspection.
14.6. Prior to the testing of any works of the Licensee by an Electrical Inspector or authorised person reasonable notice of the testing shall be given to the Licensee. The testing shall be carried out at such times as shall (in the opinion of the Electrical Inspector or the authorised person) least interfere with the supply of energy by the Licensee and in such manner as the electrical Inspector or the authorised person may think fit. Except pursuant to an order made for that purpose by the State Government, the Electrical Inspector or authorised person shall not be entitled to have access to, or interfere with, the works of the Licensee at any points other than those at which the Licensee itself has access. The Licensee shall not be responsible for any interruption or irregularity in the supply of energy which may be occasioned by, or required by the Electrical Inspector or the authorised person for the purpose of, any testing pursuant to this Paragraph 14.6. No testing shall take place in respect of any works or part thereof more than once in any period of three months, unless it is pursuant to an order made by the State Government.
14.7. The Commission may publish an order authorising the Licensee to exercise any power or authority which could be given to the Licensee under the Indian Electricity Act, 1910 (9 of 1910) and the Electricity (Supply) Act 1948 (54 of 1948).
14.8. Pursuant to Section 10(8) of the Act, the Licensee shall have all the powers for the placing of appliances and apparatus for the transmission of electricity that a telegraph authority possess under the Indian Telegraph Act 1885 (13 of 1885).

PART III: TECHNICAL CONDITIONS:

15. Compliance with the Grid code:
15.1. The Licensee shall comply with the provisions of the Grid Code in so far as applicable to it.
15.2. The Commission on reasonable grounds and after consultation with any affected Electricity Operators issue direction relieving the Licensee of its obligation under Paragraph 15.1 in respect of such parts of the Grid Code and to such extent as may be specified in those directions.

16. Compliance with Distribution Code:
16.1. The Licensee shall within six months of issue off this licence prepare and submit to the Commission a Distribution Code accompanied by a plan for its implementation after receiving the Commission approval.
16.2. The Licensee shall periodically review (including upon the request of the Commission) the Distribution Code and its implementation. Following any such review, the Licensee shall send to the Commission:

a report on the outcome of such review;
any proposed revisions to the Distribution Code from time to time as the Licensee (having regard to the outcome of such review) reasonably thinks fit for the achievement of the objectives of the Code as mentioned at Paragraph 16.4 below; and
all written representations or objections from authorised electricity operators (including any proposals by such operators for revisions to the Distribution Code not accepted by the Licensee in the course of the review) arising during the consultation process.

16.3. All revisions to the Distribution Code shall require approval from the Commission.
16.4. The Distribution Code shall include:

a distribution planning and connection condition containing;
(i) connection conditions specifying the technical. design and operational criteria to be complied with by any person connected or seeking connection with the licensee's Distribution System; and
(ii) planning conditions specifying the technical and design criteria and procedures to be applied by the Licensee in the planning and development of the Licensee's Distribution system;
a Distribution operating code specifying the conditions under which the Licensee shall operate the Licensee's Distribution System and under which persons shall operate their plant and/or Distribution System in relation to the Licensee's Distribution System in so far as necessary to protect the security and quality of supply and safe operation of the Licensee's Distribution System under both normal and abnormal operating conditions; and
where there is an electrical interface between two Retail Supply and Distribution Licensees, each Licensee must conform its Distribution Code for efficient operation of the interface.

16.5. The Licensee shall comply with the existing OSEB/GRIDCO General Condition Supply Regulation 1995 together with such amendment that the Commission may direct and this shall continue until the same is replaced by the Distribution Code.
16.6. The Licensee shall make available a copy of the Distribution Code in force at the relevant time to any person requesting it, at a reasonable price.
16.7. The Commission may issue direction relieving the Licensee of its obligations under the Distribution Code in respect of such parts of the Licensee's Distribution system and to such extent as on reasonable grounds as the Commission may indicate.

17. Distribution System Planning and Security Standards, Operating Standards, Overall Performance Standards and Standards of Performance:
17.1. The Licensee shall plan and operate the Licensee's Distribution system so as to ensure that, subject to the availability of adequate generating capacity, the system is capable of providing consumers with a safe reliable and efficient supply of electricity. In particular, the Licensee shall:

plan and develop the Licensee's Distribution System in accordance with the Planning and Security Standards promulgated and approved by the Commission together with the Distribution Code; and
operate the Licensee's Distribution System in accordance with the Operating Standards promulgated and approved by the Commission together with the Distribution Code.

17.2. The Licensee shall, within six months after this licence is granted, prepare and submit to the Commission for approval the Licensee's proposal for Planning and Security Standards and Operating Standards in accordance with Paragraph 17.1 above. The proposal should include a statement setting out criteria by which the Licensee's compliance with the standards may be measured. Such criteria should include the number and type of supply interruptions and deviations from the power supply quality standards specified.
17.3. The document in which the Planning and Security Standards are set forth pursuant to Paragraphs 17.1 and 17.2 above must include a statement by the Licensee as to how it proposes to implement the standards so as to:

ensure a satisfactory degree of standardisation of plant, apparatus, and equipment within the State of Orissa; and
develop and observe a policy on spare parts required

17.4. The Licensee shall within 3 months of the end of each financial year submit to the Commission a report indicating the performance of the Licensee's Distribution system during the previous financial year against the criteria referred to in Paragraph 17.2. The Licensee shall, if ordered by the Commission publish a summary of the report in a manner approved by the Commission.
17.5. The Licensee shall conduct its Distribution and Retail Supply Business in the manner which it reasonably considers to be best calculated to achieve any Overall Performance Standards or Standards of Performance in connection with the promotion of the efficient use of electricity by Consumers, as may be determined by the Commission.
17.6. The Standards of Performance may be set by the Commission, or may be proposed by the Licensee for the Commission's approval. The Licensee's compliance with the Standards of Performance may be measured, in part, by the Licensee's adherence to the Code of Practice on Payment of Bills, Complaint Handling Procedure and Consumer Rights Statement set forth in accordance with Condition 21 of this licence.
17.7. The Licensee shall supply, at least annually, information to the Commission as to the means by which it proposes to achieve the Overall Performance Standards and the Standards of Performance.

18. Investment:
18.1. The Licensee may not enter into any new arrangements to make a major investment without an authorization granted by the Commission under the terms of this Condition 18. A series of procurement that are not major investments individually but constitute a coherent project when considered in total is deemed to be a major investment for the purposes of this Paragraph 18.1.
18.2. The Commission shall grant an authorization required under Paragraph 18.1 when the Licensee demonstrates to the Commission's satisfaction that:

there is a need for the major investment in the Transmission System which the Licensee proposes to undertake; and
the Licensee has examined the economic, technical, system and environmental aspects of all available alternatives to the proposals for investing in or acquiring new Distribution System assets and has complied with the provision of Section 29 of the Electricity Supply Act 1948; and
the Licensee will obtain tenders from vendors specifying the prices and other terms on which they will supply equipment or materials or works comprising all or a significant part of a major investment. The general procedure of inviting and accepting tenders shall be in a manner approved by the Commission.

18.3. For the purposes of Paragraphs 18.1 and 18.2 the term "major investment" shall have the following meaning:

"major investment"

means a planned investment or asset procurement of Rs.5 crore or more, generally involving acquisition of major Distribution facilities; and "investment" may include the acquisition of the asset through a contract, lease or own construction.

19. Obligation to Connect Consumers:
19.1. Subject to the other provisions of this licence, the Licensee shall, on the application of the owner or occupier of any premise within the Area of Supply, provide connection to the Licensee's Distribution System for the purposes of providing a Supply of electricity to those premises.
19.2. Where the owner or occupier of any premises requires connection under the terms of Paragraph 19.1 the form of application to be made and the procedure for responding to that application shall be in accordance with the procedure specified by the Licensee and approved by the Commission.
19.3. Nothing in this Condition 19 shall required the Licensee to provide connection in circumstances where:

it is prevented from doing so by circumstances not within its control, or
to do so would involve a breach of relevant laws or regulations concerned with electrical safety, or

it is not economically, financially, or technically feasible for the connection to be given.

20. Obligation to Supply and Power supply Planning Standards:
20.1. The Licensee shall take all reasonable steps to ensure that all Consumers connected to the Licensee's Distribution System receive a safe, economical and reliable Supply of electricity except where:

the Licensee discontinues supply to certain consumers under Section 24 of Indian Electricity Act 1910 (9 of 1910), or in accordance with the Code of Practice drawn up pursuant to Condition 21;
the Licensee is obliged to regulate the supply to Consumers as may be directed by the State government under Section 22(B) of the Indian Electricity Act, 1910 (9 of 1910)

20.2. The Licensee shall, on an annual basis or more frequently if requested by the Commission:

forecast the demand for power within the Area of Supply in each of the next succeeding 5 years; and
cooperate with the Transmission & Bulk Supply Licensee in the preparation of power demand forecasts for the State of Orissa in such manner as the Transmission &: Bulk Supply Licensee reasonably consider appropriate, and in particular provide to the Transmission & Bulk Supply Licensee, and the Commission details of the demand forecasts for its own Area of Supply and the data, methodology, and assumptions on which those forecasts are based subject to the foregoing paragraphs, the Licensee shall purchase electricity from any Bulk Supplier in quantities which the Licensee considers sufficient to meet the expected demand of the Licensee's Consumers, or where appropriate, such lesser quantities as the Bulk Supplier is able to provide on account of shortage of available sources of electricity production, imports or Supply.

21. Consumer service:
21.1. Code of Practice on Payment of Bills:

The Licensee shall, within six months after this licence has come into force, prepare and submit to the Commission for its approval a Code of Practice concerning the payment of electricity bills by Consumers and including appropriate guidance for the assistance of such Consumers who may have difficulty in paying such bills and procedures for disconnecting Consumers for non-payment. In granting each approval, the Commission may make such modifications as it believes necessary in the public interest.
The Licensee shall, whenever requested to do so by the Commission, review the Code of Practice prepared in accordance with Paragraph 21.1 (a) and the manner in which it has been operated, with a view to determining whether any modification should be made to it or to the manner of its operation.
The Licensee shall submit any revision to the Code of Practice which it wishes to make to the Commission for its approval.
The Licensee shall:
1. draw to the attention of Consumers the existence of the Code of Practice and each substantive revision of it and how they may inspect or obtain a copy of the Code of Practice in its latest form.
2. make a copy of the Code of Practice revised from time to time available for inspection by members of the public during normal working hours, and
3. give or send free of charge a copy, of the Code of Practice revised from time to time to each new Consumer and to any other person who requests it on reasonable charge.

21.2. Complaint Handling Procedure:

The Licensee shall within three months after this license has come into force establish with approval of the Commission a procedure for handling complaints from Consumers about the manner in which the Licensee conducts its Distribution and Retail Supply Business. The Commission may make such modification of the procedure as it believes necessary in the public interest.
The Licensee shall, whenever requested to do so by the Commission, review the procedure established in accordance with Paragraph 21.2(a), and the manner in which that procedure has been operated with a view to determining whether any modification should be made to it or to the manner of its operation.
Any procedure established shall specify the periods within which it is intended that different descriptions of complaint should be processed and resolved.
The licensee shall submit the procedure established in accordance with Paragraph 22.2(a) and any revision of it which is proposed to be made, to the Commission for its approval.
The Licensee shall:
1. make a copy of the procedure revised from time to time available for inspection by members of the public at each of the relevant premises during normal working hours; and
2. give or send free of charge a copy of the procedure revised from time to time to each new Consumer and to any other person who requests it on reasonable charge.

21.3. Consumer Rights Statement

The Licensee shall, within three months after this licence has come into force or such other time as the Commission may allow, prepare and submit to the Commission for approval a Consumer Rights Statement explaining to Consumers their rights as customers of the Licensee in its capacity as operator of its Distribution and Retail Supply Business. The Commission may make such modification of the statement, as it believes necessary

The Licensee shall, whenever requested to do so by the Commission, review the Consumer Rights Statement established in accordance with Paragraph 21.3(a), with a view to determining whether any modification should be made.

The Licensee shall submit any revision to the Consumer Rights Statement which it wishes to make to the Commission for its approval.

The Licensee shall:
1. distribute the statement in any other manner that the Commission may specify.

PART IV: TARIFFS:

22. Basis of Charges:
22.1. The Licensee shall by Thirty First of December of each year, prepare and lodge with the Commission submissions setting out in full detail:

A statement of the Licensee's revenue requirement for the ensuing financial year prepared in accordance with the financial principles provided in Sections 57 and 57 A of the Electricity (Supply) Act, 1948 and in the sixth schedule thereto, with departures therefrom as authorised by the Commission.
A statement of the Licensee's expected revenue for the ensuing financial year, at the prevailing tariff rates.

22.2. If the Licensee desires, or the Commission directs, to amend the current tariff rates and charges, the Licensee shall prepare and lodge with the Commission, its application for such tariff amendments setting out in full the following, provided that no tariff or part of tariff shall be amended more than once in any financial year except for a fuel surcharge adjustment expressly permitted by the Regulation.

amended charges and tariffs which the Licensee proposes to apply from the date specified in the submission (such date to be not less than 90 days after the date of the submission) for the supply of electricity pursuant to the Distribution & Retail Supply Business, drawing attention to any proposed changes from those applying in the current financial year;
the aggregate revenue which the Licensee expects to be able to recover from the proposed amended tariffs and charges for the supply of electricity, such aggregate revenue figure to relate to the first full financial year after the proposed specified date, where the specified date coincide with the beginning of the financial year, where the specified date does not coincide with the beginning of the financial year the aggregate revenue figure will be calculated at the prevailing tariff rate upto the date of revision and thereafter at the revised rate upto end of the financial year;

The Commission may require comparative data for the current and/or any proceeding year, for purpose of comparison, along with such other data, calculation etc. as the Commission consider necessary, and the licensee shall furnish such data, calculations, comparisons as directed by the Commission.
22.3. The submission submitted to the Commission pursuant to paragraph 22. 1 shall include a schedule of tariffs for the supply of electricity to customers which:

shall be in accordance with the provisions of sections 12(3) and 26 of the Act; and
as far as possible, ensure that the Licensee will be able to recover the total revenue referred to in the submission submitted by the Licensee pursuant to paragraph 22.1 (a). The schedule of tariffs may, subject to the provisions of Condition 8, differentiate by type and size of customers and any other relevant factors.

22.4. Within 90 days of the receipt of submission, under this condition 22 and receipt of information/clarification on the said submission, whichever is later, the commission shall notify the Licensee:

that it approves the submission; or
that it does not approve all or any part of the submission.

Provided however the Commission has had consultations with the Commission Advisory Committee where required.
22.5. Where, in accordance with paragraph 22.4, the Commission notifies the Licensee that it does not approve the whole or part of any submission the Commission may at the same time:

require the Licensee to recalculate and lodge the submission in accordance with paragraph 22.1 or 22.2 above:
1. according to such principles or other guidelines or recommendations as the Commission may specify; and
2. within such further period as the Commission may specify; and/or
propose any modification to the whole or any part of the submission, such modification to be binding on the Licensee which shall revise and lodge the submission under the terms of paragraphs 22.1 and 22.2 and in accordance with the proposed modification.

22.6. Following approval by the Commission of any amended charges or tariffs, the Licensee shall publish details of the charges or tariffs in accordance with the requirements of Section 26(5) of the Act. The previously notified tariff and charges shall remain in effect till the amended tariffs and charges take effect.
22.7. The Licensee shall ensure that all amounts due to other Electricity Operators in respect of the electricity generated or supplied or other goods or services provided by them pursuant to their Authorised activities shall be paid promptly.
22.8. Pursuant to Section 15(9) of the Act, the Licensee shall he entitled to exercise any power or authority to take appropriate actions for:

revenue realisations;
prosecution for theft;
deterring tampering with meters; and
preventing diversion of electricity;

and all such similar matters affecting the Distribution and Retail Supply of electricity.

23. Provision of Subsidies to Certain Consumers:
23.1. The Commission may, allow the Licensee to set tariffs which do not satisfy sub-paragraph 22.3(b), if the departure is in accordance with the policy of the State Government under Section 12 of the Act subject to the State Government explicitly undertaking to make such compensation to the Licensee for loss of revenue by the Licensee for such departure. Such compensation for a year shall not be less than that estimated by the Licensee and approved by the Commission of the difference in that financial year between:

the revenue which the Licensee is entitled to recover under the terms of condition 22; and
the revenue received from the tariff' consistent with the tariff proposed under this Condition 23.

23.2. Within one month of the end of each financial year, the Licensee shall calculate the difference for the financial year between the actual values of sub-paragraphs 23.1(a) and 23.1(b), and submit such calculation to the Commission for approval. Where for any financial year:

the actual difference exceeds the estimated difference, the Licensee under intimation to the Commission shall request the State Government to pay the balance due to the licensee within one mouth of being notified.
the estimated difference exceeds the actual difference, the Licensee shall, within one month, pay the balance due to the State Government or offset the balance against any other sums due from the State Government for subsequent financial years under the terms of paragraph 23.1, under intimation to the Commission.

PART V: COMPETITION CONDITIONS:

24. Introduction of Competition in Bulk Supply:
24.1. The Commission may, after consultation with all Electricity Operators (including the Licensee in its capacity of operator of the Licensees Distribution System and Supplier of electricity pursuant to the Distribution and Retail Supply Business) in the State of Orissa formulate arrangements for the introduction of competition in the Bulk Supply of electricity in the State of Orissa in accordance with the provisions of this licence. The Commission may issue necessary orders making relevant changes in the Licence.

25. Power Procurement Procedure:
25.1. The Licensee may not purchase power from any supplier other than the holder of a Bulk supply licence or from a generator with installed capacity of 5 MW or less.

PART VI: PENALTY:

26. Penalty for contravention of provisions of the Licence:
26.1. The Licensee shall be liable for action under Section 41 of the Act in appropriate cases.

SCHEDULE 1:
Area of Supply:
The Area of Supply shall comprise the State of Orissa excluding cantonment, aerodrome, fortress, arsenal, dockyard or camp or any building or place in occupation of the Central Government for defence purposes.

The Odisha Distribution & Retail Supply Licence 1997 (No. 1/97)

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