The Kerala State Electricity Regulatory Commission (KSERC) has approved the billing procedure for the implementation of the smart prepaid metering system for government consumers availing electricity supply at the low tension (LT) level.

The Commission permitted Kerala State Electricity Board (KSEB) to adopt the proposed billing procedures for LT government consumers under Phase I of the smart prepaid metering rollout.

However, the Commission directed KSEBL to file a separate petition for approval of the capital investment plan and related details for Phase II and other consumer categories.

Background

KSEBL filed a petition seeking approval for the billing procedure, meter rent, and the methodology for levying and adjusting the security deposit for smart prepaid meters for government consumers.

It proposed implementing smart prepaid metering in two phases with an estimated cost of ₹9.31 billion (~$102.44 million).

Phase I covers approximately 300,000 connections, including government consumers, HT consumers, feeder meters, and distribution transformer meters. The Commission had earlier approved ₹1.95 billion (~$21.46 million) for Phase-I implementation.

KSEBL submitted that the smart prepaid metering initiative is aligned with the distribution sector reforms of the Ministry of Power.

The state utility noted that all government offices provided with smart meters would transition to prepaid mode with effect from March 01, 2026.

As of January 1, 2026, there were 172,724 LT government consumers across various tariff categories proposed to be covered under this billing procedure.

KSEBL said the installation of smart prepaid meters for HT consumers will be completed by August 2026 at the earliest.

KSEBL argued that the existing billing framework was designed for post-paid consumers and did not address the operational and accounting requirements of prepaid supply.

It proposed daily provisional billing through the meter data management system, monthly final billing with reconciliation, wallet-based recharge through the KSEB mobile application, and automated disconnection and reconnection mechanisms.

Proposed Billing Procedure

• Final monthly bills will be calculated by the distribution licensee in accordance with the applicable tariff schedule for the respective category of consumer and the relevant provisions of the Supply Code or other applicable regulations.
• If the final monthly bill amount at the month’s end is less than the total amount deducted under the provisional daily billing, the differential will be credited to the consumer’s account within one day of the generation of the final monthly bill.
• If the final monthly bill amount at the month’s end exceeds the total amount deducted under the provisional daily billing, the difference will be debited from the consumer’s account after generation of the final monthly bill and will be adjusted from the next recharge.
• The distribution licensee should upload the consumer’s final bill to its website upon expiry of the billing period and inform the consumer immediately upon generation of the final bill.
• The disconnection process will be initiated when the consumer’s prepaid account balance becomes zero or negative. For government consumers, there will not be any disconnection for the initial three months from the date of prepaid conversion. Before the disconnection, a grace period of up to 24 hours may be given, during which the consumer may recharge to avoid disconnection.
• The consumer under disconnection can recharge their prepaid account with an amount sufficient to cover outstanding dues, any other applicable charges, and the minimum recharge amount during the disconnection period (up to a maximum of six months) for reconnection.

KSEB stated that the proposal was revenue-neutral and did not introduce any new charges but only altered the timing and mode of recovery of approved charges.

Commission’s Analysis

The Commission observed that KSEB may adopt the proposed billing procedure for government consumers at the LT level.

However, regarding meter rent, it stated that a broader decision would be taken during the appraisal of billing procedures for the entire state.

Until further orders, KSEB was allowed to levy meter rent as approved in the tariff order dated December 5, 2024.

The Commission also clarified that consumers may purchase their own smart prepaid meters in accordance with CEA specifications. Such consumers would be exempt from the security deposit and meter rent.

The regulator directed KSEB to file separate petitions for approval of the capital investment plan and related matters for Phase II and other consumer categories before extending the system beyond LT government consumers.

In October last year, KSERC upheld KSEB’s decision to levy fixed charges on domestic solar prosumers under net-metering arrangements. The order clarified that there is no illegality in KSEBL’s current billing practice of collecting fixed charges based on total consumption, which includes grid imports, self-generation consumed at the premises, and banked energy.

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