Amid Lockdown, Goa and Union Territories Reduce Late Payment Surcharge to 1% Per Month

The Joint Electricity Regulatory Commission (JERC) for the state of Goa and union territories (UTs) has reduced the late payment surcharge (LPS) from 2% to 1% per month.

The Commission added that the decision was taken acknowledging the gravity and unprecedented nature of the situation prevailing in the country, which has been affecting the ability of the DISCOMs to pay the generators, maintain the distribution infrastructure, and serve bills to the consumers. The order also said that it has also considered the difficulties for the consumers to pay their power dues on time, given the fact that the conventional channels of payment are generally not accessible. “Besides, the industrial and commercial consumers are staring at a situation of low production and demand on services which would severely impact their ability to pay fixed charges of electricity at this time,” added the JERC order.

Noting this, the JERC has also asked the distribution companies (DISCOMs) to extend the due date for the payment of electricity bills (including those already raised) where the deadlines fall between March 24, 2020, and June 30, 2020, by another two weeks without any late payment surcharge. However, if the extended due date falls beyond June 30, 2020, then it will not be further extended.

The Commission decided to mitigate the difficulties being faced by the consumers and DISCOMs of the territories given the nationwide lockdown announced by Prime Minister Modi to arrest the Coronavirus (COVID-19) outbreak.


Apart from Goa, the electricity departments of Puducherry, Andaman and Nicobar Islands, Lakshadweep Islands, Chandigarh, and Daman and Diu, also come under the jurisdiction of the JERC.

The DISCOMs can raise the bills either by direct meter reading or through provisional bills. The Commission has also asked the DISCOMs to encourage their consumers to take their meter readings, which can be sent through WhatsApp on the number provided, or the DISCOMs can also send the bills by electronic means such as e-mail or SMS. The Commission has directed the DISCOMs to encourage all types of digital payments without demanding any bank transaction charges from the consumers.

“This amount can be considered as the collection expense for the DISCOMs in accounting rate of return (ARR),” the order added. According to the Commission, this relaxation is temporary and is for the billing period starting from March 24, 2020, to June 30, 2020.

The JERC has also asked the DISCOMs to provide a moratorium on payment of fixed charges to all industrial and commercial consumers for the bills that fall between March 24, 2020, to June 30, 2020. The deferred charges will be recovered over the next three bills to be raised after June 30, 2020.

The Commission said that the distribution licensees will be required to borrow or avail additional working capital and added that it would consider the additional expenses that are likely to be incurred by the distribution licensees in its annual percentage rate of the financial year 2020-21.

Background

After the announcement of the lockdown, several stakeholders had approached the Commission to provide relief to the industrial consumers. The electricity department of Puducherry also sought directions on the demands listed by these industries.

The demands included:

  • Waive the fixed cost for March, April, and May 2020
  • Waive the regulatory surcharge of 4% for these three months
  • Defer the issue of tariff order for 2020-21 by three months
  • Advise the Puducherry Electricity Department (PED) to defer the February and March 2020 electricity bill payments and collect in six equal installments without levying any interest starting from May 2020,
  • To provide electricity at a subsidized rate for at least five years with effect from April 2020 in Dadar and Nagar Haveli and Daman and Diu

Recently, the Central Electricity Regulatory Commission (CERC) reduced the rate for late payment surcharge payable by DISCOMs to power generators. The surcharge was reduced to 12% per annum from the earlier 18% if the due date falls between March 24, 2020, and June 30, 2020, as previously reported by Mercom.

Following this, the Punjab State Electricity Regulatory Commission also provisionally reduced the rate of late payment surcharge to 6% per annum if the due date falls between March 24, 2020, and June 30, 2020. Madhya Pradesh and Delhi have also issued similar orders.

The Delhi Electricity Regulatory Commission (DERC) has reduced the rate of LPS from 18% to 12% per annum for bills that are raised between March 24, 2020, and June 30, 2020. On the other hand, Madhya Pradesh Electricity Regulatory Commission (MPERC) has reduced the rate of current late payment surcharge to be paid by the state’s distribution companies to power generators and inter-state transmission licensees by 0.50% per month.

With the ongoing lockdown amid the COVID-19 outbreak, the center and state governments are making efforts to support the power industry. You can track the latest developments and the impact of Coronavirus on the renewable industry on Mercom India’s live updates blog for COVID-19.