‘Shock’ every month! Discoms soon to decide on power tariff

Commercial power consumers must install smart meters by next year
Representative image. File Photo.

New Delhi: Soon, consumers may find their electricity bills increasing monthly if the Central Government goes ahead with the proposed the Electricity (Amendment) Bill, 2022. The Centre has already sought the states' opinion on the ‘Draft Amendments to Electricity Rules 2005’.

As per the amendment, power distribution companies can hike the tariff every month based on the changes in fuel and power purchase cost, and transmission charges. The Bill has also prescribed a formula to calculate the additional charge to be levied. The companies do not require the regulatory commissions' nod to impose the tariff hike.

Why the change?

Most of the power distribution companies in the country are in a financial crisis.

The move is aimed at relieving their burden in meeting the increase in the purchase cost of electricity from outside, besides the fuel expenses.

The additional amount will be levied from consumers under the head Fuel and Power Purchase Adjustment Surcharge (FPPAS).

Can delay tariff hike up to two months

The Bill clarifies that the regulatory commission should clarify the method used (formula) to calculate the electricity charges within three months of the amendment coming into force.

Till then, the tariff should be arrived at using the method prescribed by the Centre.

For instance, the power distribution companies can include the additional fuel expenses, distribution, and power purchase charges relating to April in the June bill.

The companies can delay levying of the FPPAS by up to two months, if necessary, to avoid a heavy burden on the consumers.

They can do this only if the additional charges form more than 20 % of the total tariff. However, the firms cannot levy the charges outside the stipulated period.

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