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					</table><p>The Karnataka Electricity Regulatory Commission (<a href="https://kerc.karnataka.gov.in/en" target="_blank" rel="noopener">KERC</a>) has increased the average retail electricity tariff for all low-tension (LT) and high-tension (HT) categories by ₹0.70 (~$0.008)/kWh for the financial year (FY) 2023-24.</p>
<p>It was increased by 8.31% to ₹9.12 (~$0.011)/kWh compared to ₹8.42 (~$0.10)/kWh in FY23.</p>
<p>The revised tariff will be applicable from April 1, 2023.</p>
<p>Of the increase, ₹0.57 (~$0.007)/kWh will be recovered through fixed charges, and the remaining ₹0.13 (~$0.002)/kWh will be recovered as energy charges.</p>
<p>The electricity supply companies (ESCOMs), in their submission, had recommended an average increase of ₹1.39 (~$0.017)/kWh in tariff.</p>
<p>As a relief measure and to encourage the adoption of electric vehicles in the state, the Commission reduced the tariff for EV charging stations to ₹4.50 (~$0.054)/kWh as against the existing rate of ₹5 (~$0.061)/kWh.</p>
<p>The green tariff of ₹0.50 (~$0.006)/kWh for renewable electricity on top of the applicable tariff for HT industrial and HT commercial customers will continue.</p>
<p>Also, the rebate of ₹0.50 (~$0.006)/kWh for micro and small industries will continue for another year.</p>
<p>Under the Discounted Energy Rate program, KERC has reduced the energy charges to ₹5 (~$0.061)/kWh as against the existing rate of ₹6 (~$0.073)/kWh. Earlier, the program applied to HT consumers, which has now been extended to LT Industries and commercial installations with a sanctioned load of 50 kW and above.</p>
<p>To simplify the tariff structure, the number of consumer categories has been reduced to 21 from 31.</p>
<p>The Commission has directed the distribution companies (DISCOMs) to set up a portal to maintain the details of PPAs executed and approved by the competent authorities to monitor the terms and conditions of the PPAs and also to regulate the payment of power purchase bills online.</p>
<p>The portal should be made operational within three months.</p>
<p>The Commission has set a revised transmission tariff for the Karnataka Power Transmission Corporation (<a href="https://kptcl.karnataka.gov.in/english">KPTCL</a>) as ₹163,031 (~$1,971)/MW per month for FY 2024 against the transmission tariff of ₹172,897 (~$2,090)/MW per month approved earlier.</p>
<p><strong>Annual Revenue Requirement </strong></p>
<p>The Commission approved a total Annual Revenue Requirement (ARR) of ₹581.09 billion (~$7.03 billion) as against ₹621.33 billion (~$7.51 billion) sought by the ESCOMs in their tariff applications.</p>
<p>Also, the Commission approved a net revenue deficit of ₹44.571 billion (~$539.02 million) for FY 2024, which included a revenue deficit of ₹17.201 billion (~$208.02 million) as per the annual performance review for FY 2022.</p>
<p><strong>The proposed and approved ARR for ESCOMs</strong></p>
<p style="text-align: center;"><a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024.png"><img decoding="async" loading="lazy" class="alignnone wp-image-54761 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024.png" alt="KERC-State-wise Approved ARR for FY 2024" width="374" height="197" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024.png 374w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024-300x158.png 300w" sizes="(max-width: 374px) 100vw, 374px" /></a></p>
<p>The Commission has approved a total ARR of ₹288.73 billion (₹3.49 billion) for the Bangalore Electricity Supply Company <strong>(</strong><a href="https://bescom.karnataka.gov.in/english" target="_blank" rel="noopener">BESCOM</a>), whereas for the Mangalore Electricity Supply Company (<a href="https://mescom.karnataka.gov.in/english" target="_blank" rel="noopener">MESCOM</a>), the approved amount is ₹47.71 billion (~$577.2 million).</p>
<p>For the Chamundeshwari Electricity Supply Company (<a href="https://cescmysore.karnataka.gov.in/english" target="_blank" rel="noopener">CESC</a>), the approved ARR amount is ₹61.48 billion (~$743.7 million), whereas for the Hubli Electricity Supply Company (<a href="https://hescom.karnataka.gov.in/english" target="_blank" rel="noopener">HESCOM</a>) and the Gulbarga Electricity Supply Company (<a href="https://gescom.karnataka.gov.in/english" target="_blank" rel="noopener">GESCOM</a>), the approved ARR amount is ₹108.89 billion (~$1.32 billion) and ₹74.28 billion (~$898.5 million), respectively.</p>
<p><strong>Hukkeri Rural Electric Cooperative Society</strong></p>
<p>KERC has approved an ARR of ₹2.56 billion (~$30.96 million) for FY 2024 compared to ₹3.1 billion (~$37.49 million) approved by the Hukkeri Rural Electric Cooperative Society. The approved net revenue deficit for FY 2024 has been calculated as ₹22.8 million (~$275.73 million). The subsidy approved for free power has been set as ₹1.11 billion (~$13.42 million) for FY 2024.</p>
<p><strong>ARR for Special Economic Zones </strong></p>
<p>KERC has approved the revised ARR of ₹701.4 million (~$8.48 million) for FY 2024 against ₹573.4 million (~$6.93 million) proposed by the Mangalore Special Economic Zone. The approved net revenue deficit for FY 2024 has been set as ₹17.88 million (~$216,234).</p>
<p>The Commission has also approved the revised ARR of ₹259.76 million (~$3.14 million) for FY 2024 against ₹248.3 million (~$3.01 million) proposed by AEQUS Special Economic Zone. The approved net revenue deficit for FY 2024 has been calculated as ₹1.06 million (~$12,819).</p>
<p>In January this year, DISCOMs of Karnataka <a href="https://www.mercomindia.com/karnataka-tariff-hike-proposal-to-deter-availing-open-access" target="_blank" rel="noopener">proposed</a> revised tariffs for LT and HT consumers, which included grid support charges for captive open access power consumers.</p>
<p>Subscribe to Mercom’s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates</a> to ensure you don’t miss any critical updates from the renewable industry.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/rakesh-ranjan-parashar/" class="vcard author" rel="author"><span class="fn">Rakesh Ranjan</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Rakesh Ranjan,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener">More articles from Rakesh Ranjan.</a></p>
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<p><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="77" height="102" /><a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener"><strong style="color: #00b451">Rakesh Ranjan</strong></a> is a staff reporter at Mercom India. Prior to joining Mercom, he worked in many roles as a business correspondent, assistant editor, senior content writer, and sub-editor with bcfocus.com, CIOReview/Silicon India, Verbinden Communication, and Bangalore Bias. Rakesh holds a Bachelor’s degree in English from Indira Gandhi National Open University (IGNOU). <a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" rel="noopener noreferrer">More articles from Rakesh Ranjan.</a></p>
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Karnataka Increases Average Retail Electricity Tariff by ₹0.70/kWh for FY24

<p>The Union Minister R.K. Singh said in Rajya Sabha that the gap between the Average Cost of Supply (ACS) and the Average Revenue Realized (ARR) at the national level reduced from ₹0.47 (~$0.006)/kWh in FY 2015-16 to ₹0.28 (~$0.004)/kWh in FY 2019-20.</p>
<p>The gap between the revenue and cost per unit/kWh is one of the critical performance parameters for power distribution companies. A wider gap reflects that the distribution companies are under loss as their revenues are far lower than their expenditure.</p>
<p>Earlier in June this year, the Union Finance Minister Nirmala Sitharaman had <a href="https://mercomindia.com/finance-minister-announces-%e2%82%b93-03-trillion-upgrading-discoms/" target="_blank" rel="noopener">announced</a> the ‘Economic Relief from Pandemic’ package and declared several sops for power distribution companies (DISCOMs), including ₹3.03 trillion (~$40.82 billion) outlay for reform-based result-linked power distribution program.</p>
<p>The program aims to improve the quality and the reliability of power supply to consumers through a financially sustainable and operationally efficient distribution sector. The plan is to reduce the aggregate technical and commercial (AT&amp;C) losses across India to 12-15% and eliminate the gap between the average cost of supply and the aggregate revenue requirement by 2024-25.</p>
<p>The minister added that all state-owned distribution companies and state and union territory DISCOMs, excluding private sector DISCOMs, will be <a href="https://mercomindia.com/ministry-power-plan-revamp-discoms/" target="_blank" rel="noopener">eligible</a> for financial assistance under the revamped distribution sector program.</p>
<p>According to the data released by the Ministry of Power, the ACS-ARR gap narrowed in 18 states/union territories between financial year (FY) 2016 to FY 2020. On the national level, the gap narrowed from ₹0.47 (~$0.006)/kWh to ₹0.28 (~$0.004)/kWh from FY 2016 to FY 2020.</p>
<p>In reply to the question, the minister shared the state-wise data regarding the narrowing of the ACS-ARR gap and the current status of the states. The data is based on the subsidies booked by the states to the central government.</p>
<p style="text-align: center;"><img decoding="async" loading="lazy" class="aligncenter size-full wp-image-28197" src="https://mercomindia.com/wp-content/uploads/2021/08/Gap-in-Average-cost-of-supply-ACS-and-Average-Revenue-Realised-ARR-on-Tariff-Subsidy-Booked-Basis-in-India.png" alt="" width="456" height="941" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2021/08/Gap-in-Average-cost-of-supply-ACS-and-Average-Revenue-Realised-ARR-on-Tariff-Subsidy-Booked-Basis-in-India.png 456w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2021/08/Gap-in-Average-cost-of-supply-ACS-and-Average-Revenue-Realised-ARR-on-Tariff-Subsidy-Booked-Basis-in-India-145x300.png 145w" sizes="(max-width: 456px) 100vw, 456px" /></p>
<p>The ARR-ACS has considerably widened in Arunachal Pradesh, Meghalaya, Nagaland, Puducherry, and Tamil Nadu, which is concerning.</p>
<p>On the positive side, the ARR-ACS gap has narrowed significantly in Andhra Pradesh, Jammu &amp; Kashmir, Madhya Pradesh, Mizoram, and Sikkim.</p>
<p>Only six states have registered revenues more than the cost of power supply. These include Assam, Gujarat, Haryana, Himachal Pradesh, Rajasthan, and West Bengal.</p>
<p>In April last year, the Ministry of Power had <a href="https://mercomindia.com/electricity-act-amendment-draft/" target="_blank" rel="noopener">proposed</a> amendments to the Electricity Act 2003 to improve the health of DISCOMs, including direct benefit transfer and cost-reflective tariffs, among others.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/rakesh-ranjan-parashar/" class="vcard author" rel="author"><span class="fn">Rakesh Ranjan</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><div class="designboxt">
<p><img class="alignleft" style="border-radius: 50%;height: 50px;margin-top: -4px;border: 1px solid #00b451" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="50" /></p>
<p><strong style="text-decoration: underline">Rakesh Ranjan,</strong> Staff reporter at Mercom India<br />
<a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener">More articles from Rakesh Ranjan.</a></p>
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<p><img class="alignleft" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2022/02/Rakesh-Headshot-crop-2.jpg" width="77" height="102" /><a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" target="_blank" rel="noopener"><strong style="color: #00b451">Rakesh Ranjan</strong></a> is a staff reporter at Mercom India. Prior to joining Mercom, he worked in many roles as a business correspondent, assistant editor, senior content writer, and sub-editor with bcfocus.com, CIOReview/Silicon India, Verbinden Communication, and Bangalore Bias. Rakesh holds a Bachelor’s degree in English from Indira Gandhi National Open University (IGNOU). <a href="https://mercomindia.com/author/rakesh-ranjan-parashar/" rel="noopener noreferrer">More articles from Rakesh Ranjan.</a></p>
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Gap Between DISCOMs’ Energy Cost and Revenue Narrowed to ₹0.28/kWh in FY 2020

<p>The Appellate Tribunal for Electricity (APTEL) has directed the state and joint electricity regulatory commissions to explain the delay in the revision of the tariff, lack of payments to the distribution companies (DISCOMs) and gaps in revenue over the last three fiscal years.</p>
<p>The matter dates back to a letter from the secretary to the Ministry of Power, written in January 2011. The letter laid out various challenges faced by distribution utilities which resulted in a serious impact on the financial status of the electricity sector. The matter was discussed, and the tribunal directed state electricity regulatory commissions that an annual performance review, true-up of past expenses, annual revenue requirement (ARR), and tariff determination must be conducted yearly on a timely basis.</p>
<p>However, state commissions of Andhra Pradesh, Manipur, Mizoram, Jharkhand, Punjab, Meghalaya, Tamil Nadu, and West Bengal have not been complying with those directions of the tribunal passed in November 2011. Following are the latest directions of the tribunal:</p>
<p><em>“We direct all the state and joint regulatory commissions to furnish the necessary information to the secretary of Forum of Regulators, who shall in turn file compilation of compliance reports before this tribunal. This exercise is to be completed on or before 31.10.2019.”</em></p>
<p>According to APTEL, the delay in tariff revisions was one of the main reasons for the financial stress that the state DISCOMs were witnessing. Currently, state DISCOMs owe power generators more than ₹525 billion ($7.4 billion).</p>
<p><a href="https://mercomindia.com/payment-dues-discoms-renewable-escalate/" target="_blank" rel="noopener noreferrer">Recently</a>, the Central Electricity Authority’s (CEA) report stated that the total payment due for 513 renewable projects now amounts to ₹97.36 billion (~$1.36 billion) as of July 31, 2019, thus  showing an increase of nearly ~₹15 billion (~$0.21 billion) compared to the previous figure of ₹82.3 billion (~$1.14 billion) for the same period.</p>
<p>In <a href="https://mercomindia.com/payment-delays-hit-solar-and-wind-developers/" target="_blank" rel="noopener noreferrer">May 2019</a>, Mercom reported that payment delays were becoming a problem again for solar and wind project developers in India, especially in Andhra Pradesh, Tamil Nadu, and Telangana.</p>
<div class="saboxplugin-wrap" itemtype="http://schema.org/Person" itemscope itemprop="author"><div class="saboxplugin-tab"><div class="saboxplugin-gravatar"></div><div class="saboxplugin-authorname"><a href="https://cms.mercomindia.com/author/shaurya-bajaj/" class="vcard author" rel="author"><span class="fn">shaurya</span></a></div><div class="saboxplugin-desc"><div itemprop="description"><p><span style="font-family: Calibri"><span style="color: #000000"><span>Shaurya is a staff reporter at MercomIndia.com with experience working in the Indian solar energy industry for the past four years in various roles. Prior to joining Mercom, Shaurya worked with a renewable energy developer and a consulting company. Shaurya holds a Bachelors Degree in Business Management from Lancaster University in the United Kingdom. </span></span></span></p>
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APTEL Comes Down on State Electricity Regulators for Delay in Tariff Revision

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