Power jolt for Delhi! Electricity bills to rise by up to 10% in May-June; residents slam hike as ‘arbitrary’

Delhi Electricity Hike News: Power bills for lakhs of consumers in Delhi will see a hike of around 7–10 per cent during the May-June period as electricity distribution companies (discoms) pass on the increased fuel costs through the Power Purchase Adjustment Cost (PPAC), officials said on Sunday, according to PTI report.

The Delhi Electricity Regulatory Commission (DERC), in separate orders earlier this month, gave a green signal to the three discoms in the capital—BRPL, BYPL and TPDDL—to recover PPAC for the third quarter of the financial year 2024–25.

What is PPAC and why is it rising?

The PPAC reflects the increase in power purchase costs due to fuel (coal, gas) price escalation incurred by electricity generation companies. This amount is recovered by the discoms from end consumers. It is calculated as a percentage of both the fixed charge and energy charge (units consumed) components of an electricity bill.

According to the latest orders:

BRPL can levy a PPAC of 7.25 per cent
BYPL can recover 8.11 per cent
TPDDL has been allowed to charge 10.47 per cent

These hikes are likely to translate into noticeable increases in electricity bills across the city during the ongoing billing cycle. While there has been no official reaction from the discoms regarding the new PPAC rates, reportedly sources from within the distribution companies defended the move.

“The PPAC is recovered to ensure timely pass through of power purchase cost, which is dependent upon the coal and gas prices, to the consumer. It is a statutory mandate and the process is very transparent and validated by the regulator,” PTI reported, citing a source. The discoms added that without this adjustment, they would face liquidity stress and may struggle to pay power generation companies.

URD slams DERC’s approval, calls process ‘legally wrong’

However, the decision hasn’t gone down well with city residents. The United Residents of Delhi (URD), an umbrella group of RWAs, has termed the move “arbitrary” and questioned the legitimacy of the entire process.

“The process under which PPAC charges have been imposed on the people of Delhi by DERC is legally wrong,” said URD general secretary Saurabh Gandhi in a statement.

Gandhi alleged that the new DERC panel did not follow the due procedure for tariff determination. “For the last several years, the Commission has been benefiting the power companies from other items. Now we had great hope from the Commission that has been formed that it will complete the work of tariff determination by following the prescribed procedure, but this Commission conducted a virtual public hearing where not enough time was given to the stakeholders to state their case,” he said.

He also pointed out inconsistencies in how the PPAC was allocated across different discoms. “It is also a fact that the PPAC claimed by various discoms and the PPAC awarded by DERC is different. For BRPL it is 7.25 per cent, for BYPL it is 8.11 per cent and for TPDDL it is 10.47 per cent,” he said.

 ‘Fuel surcharge should be uniform across discoms’

URD has also raised concerns about the variation in PPAC percentages when the underlying fuel costs are similar. “Since the cost of fuel surcharge under u/s 64(4) is almost the same for all discoms, the percentage differential tariff should have been the same,” Gandhi noted.

Meanwhile, the DERC has not issued a statement in response to the allegations by URD.

(With inputs from PTI)