Power gets costlier for Delhi's unsubsidised consumers

The monthly electricity bills of the majority of domestic consumers in Delhi -- who use more than 200 units and up to 600 units -- will be hiked by up to Rs 265 due to an increase in the power purchase adjustment cost (PPAC) levied by discoms in the city, officials said on Monday.

Delhi's power minister Atishi said consumers having monthly consumption of up to 200 units who get zero bills will not be impacted but those who do not get subsidy will have to pay nearly eight per cent more on their monthly bills.

She alleged that the Centre's mismanagement" resulted in the hike in PPAC

"I just want to tell the consumers that only the Centre is responsible for this hike. It has forced the use of imported coal, which is 10 times costlier than domestic coal. This is despite no lack of coal mines or availability of coal in the country," she said.

Officials said the Delhi Electricity Regulatory Commission has allowed the PPAC surcharge hike by different discoms.

Atishi said electricity bills in Delhi will see a "small" hike from July.

"The bills of TPDDL consumers (29 per cent of all domestic consumers) will see a hike of 1.2 per cent between their bills of June and July, BRPL consumers (45 per cent) will see a hike of 5.5 per cent and BYPL consumers (26 per cent) will see a hike of 7.7 per cent in their July bills," she said.

She mentioned that determination of the PPAC is a routine process of the DERC, which is undertaken every three months.

The PPAC is levied to offset the increase in fuel prices. It is calculated as percentage of fixed charge plus energy charge components of the electricity bills.

According to officials, the monthly hike in PPAC for BRPL consumers having 2 KW connections, will be Rs 43 (200 units), Rs 103 (400 units), Rs 190 (600 units). The hike for BYPL consumers will be Rs 59 (200 units), Rs 143 (400 units) and Rs 265 (600 units).

For TPDDL consumers, the PPAC hike will be Rs 10 (200 units), Rs 24 (400 units) and Rs 44 (600 units), they said.

In case of the New Delhi Municipal Council (NDMC) discom the hike will be Rs 13 (200 units), Rs 32 (400 units) and Rs 60 (600 units), they added.

The latest decision to hike PPAC in Delhi is due to the blending of imported coal by the power stations, increased gas prices and high prices in power exchanges, which had reached its maximum ceiling limit (currently Rs 10 per unit), officials said.

The revised PPAC is: BRPL, 27.08 per cent from the existing 20.69 per cent; BYPL, 31.60 per cent from 22.18 per cent; TPDDL, 29.13 per cent from 27.64 per cent; and NDMC 30 per cent from the existing 28 per cent, they said.

The increased PPAC has been effective since June 22 in the case of BRPL, BYPL and NDMC, while it is effective since June 7 in the case of TPDDL. The increase in PPAC will be effective till March 2024, officials said.

No immediate reaction was available from BRPL, BYPL and NDMC over the hike. A TPDDL spokesperson said that PPAC has increased by 1.49 per cent for the discom under the June 7 DERC order.

"This decision has been made in response to the rising costs associated with power generation mainly due to increased blending of imported coal as per power ministry directions," said the TPDDL spokesperson.

The people of Delhi get free electricity on monthly consumption of 200 units. Those consuming 201-400 units get a 50 per cent subsidy.

Atishi alleged, "I want to say that if the electricity is getting costlier in Delhi, it is only because of the Centre's mismanagement."

Noting that discoms are allowed to increase or lower the PPAC for three-month periods, Atishi said, "The prices of electricity have been increased due to the Centre's mismanagement. There is an artificial shortage of coal in the country for the first time in the last 70 years, shooting up its price."

The Centre has "forced" coal buyers to purchase at least 10 per cent imported coal, which costs 10 times more than Indian coal. Domestic coal is priced around Rs 200 per tonne while the imported variety costs Rs 25,000 a tonne, the Delhi power minister claimed.

"We want to know from the Centre if there is a nexus with coal importers which is why coal buyers are being forced to purchase imported coal at 10 times higher prices," she asked.

She said that the Delhi government is "exploring" if CAG’s audit of the power discoms is possible.

The Delhi government will not accept any corruption in discoms, she said.

"It has shown maximum strictness towards the discoms and that is one reason why the electricity rate is minimum in Delhi," said the minister.

The power purchase cost is dependent upon the coal or gas prices used in power generation. There has been a significant increase in coal prices due to higher imports and transport costs, officials said.

According to the ministry of power directions in 2021, every state regulatory commission has to place a mechanism for automatic pass-through of fuel and power procurement costs in tariff for ensuring the viability of the power sector.

In the case of Delhi, there is no automatic pass through but the discoms levy PPAC only after approval of DERC, said the officials.

A top DERC functionary said that PPAC is meant for a "limited period" to recover the extra expenditure made due to an increase in supply cost because of coal blending.

The PPAC is recovered so that the consumers are not burdened with the interest cost due to delay in recovery, officials said.