Heavy power users to cough up addl. surcharge from next month

Hyderabad: The Telangana State Electricity Regulatory Commission (TSERC) has fixed additional surcharge for open access consumers for the period between April 1 and September 30, 2023 at 39 paise per unit. This is against the Rs 9.86 per unit proposed by the two power distribution companies (SPDCL & NPDCL). Heavy power users, mainly industries, will have to pay the additional surcharge from next month.

The State-owned Discoms charge additional surcharge for power purchased in open access (power bought from third party and power exchange using the Discom's network) by high-tension consumers, mostly industries. As part of this, the State Discoms had submitted proposals to ERC to collect Rs 210.20 crore in the form of net charges, but the commission has given flexibility to collect only Rs 8.29 crore to the Discoms.

Discoms had proposed to collect Rs 354.68 crore from open access customers in the form of transmission and distribution charges, while the ERC has allowed only Rs 172.05 crore.

Apart from the electricity supplied by them at the highest price, the Discoms proposed to collect huge amounts in the name of wheeling charges and surcharges in 2023-24 from companies and industries which buy electricity at a low price in the open market. But the TSERC's decision has put a block to these plans. The Discoms had proposed to collect Rs 9.86 per kilowatt hour as additional charges from industrial companies buying electricity from open access.

During a public hearing last month, representatives of several companies had requested ERC to direct Discoms not to levy additional surcharge on consumers who purchase electricity in the open market under the open access system. The open access consumers had objected that the additional surcharge of Rs.9.86 per unit proposed by the Discoms as it was much higher than the average cost of supply of Rs 7.06 per unit and wanted it to be reduced. In fact, they questioned the rationale behind imposing additional surcharge on them when the Electricity Act permits them to purchase power from the open market.

According to the Energy department officials, Discoms impose cross-subsidy surcharge (CSS) and additional surcharge (AS) on open access consumers to cross subsidise their loss over losing a consumer to another supplier.