NEW DELHI: A 50% reduction in power tariff in Delhi and a CAG audit of the books of the capital’s three private power distribution companies were among the key promises made by AAP that seem to have captured the imagination of many voters. Both may be easier said than done, a look at the ground reality suggests.AAP has been insisting that the private discoms are inflating their costs to get higher tariff approved by the regulator and that a rigorous scrutiny of their books will reveal this and hence enable a reduction in tariff. While the political imperative to carry out such an audit would be high, there could be legal hurdles. A petition questioning whether CAG has the mandate to examine books of private companies, especially when there is no revenue-sharing arrangement with the government, is pending in Delhi high court.It appears that any reduction in tariff can only come through huge subsidies. Effectively then, the taxpayer will pay for the reduced power bills in other ways. Discom officials TOI spoke to estimate that the cost of a 50% reduction in power tariff would entail a subsidy bill of about Rs 500 crore a month.Discoms have consistently maintained that even the existing tariff does not cover costs and it is insufficient to meet their operating and other expenses. “Normally, around 80% of a discom’s revenue should be towards power purchase, an uncontrollable expense. But in the case of BSES , it has become 90%. This, along with the increasing interest costs, has led to its expenditure becoming more than 100% as a percentage of its total revenue in 2012-2013,’’ said discom sources.The discoms have, in fact, claimed a cumulative revenue gap of Rs 20,000 crore owing to tariff revisions not keeping pace with rising costs, including for buying power.But what would a CAG audit achieve when the Delhi government, with 49% equity in the discoms, has access to the balance sheet and financial details of the discoms and can itself verify any gold-plating or false claim of revenue loss.Delhi’s discoms source nearly all their power from public sector generation units at tariff examined and approved by the central regulator. “Hence more than 80% of expenses are indirectly audited by CAG,’’ argued discom officials. Also, the books are examined by lenders headed by SBI – again, a government bank. Industry officials also point out that reducing power tariff would mean encouraging more power consumption.“Delhi’s internal generation cannot increase despite new plants coming up due to a gas crisis and coal shortage. This will lead to more dependence on central sector units,’’said an expert. Discoms have anticipated a 5%-10% increase in power demand over and above the annual power demand growth.The peak power demand this year was 5,654MW, and this could increase by another 1,000-1,200 MW for next year’s peak by incorporating annual growth and larger consumption due to reduced tariff.