New Delhi: Delhi Electricity Regulatory Commission (DERC) is likely to come up with a revised power tariff order by July. The power regulator has already set the process in motion, officials said. The last tariff order was issued in Sept 2021 while the electricity rates in the city has remained unchanged since 2014. The discoms have long been seeking a cost-reflective tariff, arguing that their average power purchase cost rose by over 20% in the past decade even as the tariff had remained stagnant.
DERC, without a chairman since last July, has already issued a public notice proposing to extend its business plan regulations till the financial year 2026-27. Stakeholders have been invited to submit comments and suggestions on the proposal by 5pm on Jan 27. “The Business Plan Regulations 2023, which were made for three years, will be extended by one more year because the new regulations are yet to be finalised. After the regulations are extended, the discoms will be directed to submit their tariff petitions for 2026-27,” an official told TOI. “DERC is aiming to complete the tariff revision process by July,” he added.The regulations form the backbone for tariff setting, laying down norms for issues such as distribution losses, capital expenditure and efficiency targets. The proposed extension is aimed at avoiding a regulatory vacuum that could disrupt tariff filings and operational planning by discoms.It is not yet clear if the electricity rates will increase or remain the same, said sources. The final tariff depends on a detailed process. First, each discom submits a petition to DERC outlining its expected costs, revenues and the tariff hike it seeks. DERC scrutinises these filings, verifying costs, assessing efficiency targets and evaluating whether past shortfalls can be recovered. The petitions are made public and consumers, industry groups and residents associations can provide feedback or raise objections through consultations and public hearings. After reviewing all inputs, DERC issues the final tariff order, which determines the electricity rates for the year.The delay in tariff revision, officials warned, has cost implications for consumers. “When tariffs are not revised on time, discoms continue to charge older rates even as their costs rise — whether due to power purchase, fuel, transmission charges or interest. The unrecovered gap is carried forward as a revenue shortfall, on which interest, or carrying cost, is added. When tariffs are finally revised, consumers end up paying both the delayed cost increase and the accumulated interest,” an official explained.DERC is responsible for determining tariff for power generation, transmission and distribution, apart from setting performance standards and overseeing the functioning of utilities. It has set a target for distribution loss for 2026-27 at 6.4% for BSES Rajdhani, 6.2% for BSES Yamuna, 5.5% for Tata Power Delhi Distribution Ltd and 6.4% for NDMC.
