The Telangana Electricity Regulatory Commission (TGERC) has determined that no additional surcharges will be levied on open access power consumers for the second half (2H) of the financial year (FY) 2026.

Previously, the Commission determined an additional tariff of ₹1.45 (~$0.016)/kWh in 1H FY 2026.

The new nil surcharge approved by the Commission will be applicable from October 1, 2025, to March 31, 2026.

TGERC stated that it decided not to impose the surcharge because the Telangana distribution companies (DISCOMs) had no recoverable stranded charges.

Background

The Southern Power Distribution Company of Telangana and the Northern Power Distribution Company of Telangana had filed petitions for the determination of an additional surcharge to be levied on open access consumers for 2H FY 2026.

As per the Commission’s directions, the DISCOMs issued public notices regarding the additional surcharge for this period in two newspapers.

The DISCOMs approached the Commission to approve an additional surcharge of ₹0.35/kWh for 2H FY 2026.

The petitioners informed the Commission that stakeholders did not file any objections or suggestions in response to the public notice.

Commission’s Analysis

The Commission observed that the DISCOMs followed the approved methodology for calculating the additional surcharge by averaging the 15-minute time-block data over the entire six-month period.

It also agreed with the DISCOMs’ claim that open access sales for the period were 254.72 million units (MU).

Reviewing the DISCOMs’ 15-minute time block data, the Commission found that in certain periods, the scheduled capacity exceeded the available capacity due to the allotment of un-requisitioned surplus to them.

TGERC also noted that the DISCOMs considered gross deficit/surplus for the 15-minute time block period as nil.

Additionally, the Commission stated that the DISCOMs purchased energy under short-term arrangements and sold power in the market during specific time blocks when surplus capacity was available.

It added that these short-term purchases during surplus capacity periods cannot be attributed to stranded capacity from open access consumers.

Therefore, the Commission held that the stranded capacity must be calculated after deducting short-term purchases from the gross (deficit)/surplus in the corresponding time block.

It approved the stranded capacity for open access as 92.26 MW against the DISCOMs’ claim of 93.02 MW.

The DISCOMs computed the fixed charges for stranded capacity as ₹533.7 million (~$6 million), based on 92.96 MW of stranded capacity at a rate of ₹5.74 million (~$64,655)/MW.

The transmission charges per unit have been worked out as ₹0.56 (~$0.006)/kWh, while the distribution charges for the high-tension network have been calculated at ₹0.11 (~$0.001)/kWh.

The Commission determined the transmission and distribution charges payable by open access consumers at ₹1.28 billion (~$14.4 million).

It also determined that the demand charges recovered by the DISCOMs from open access consumers were approximately ₹632.9 million (~$7.12 million).

The Commission observed that since there were no net stranded charges recoverable from open access consumers, the demand charges would be adjusted to ₹632.9 million (~$7.13 million), exceeding the fixed charges of ₹533.7 million (~$6 million) for stranded capacity.

The Commission approved a nil additional surcharge after considering that the DISCOMS had no recoverable stranded charges.

Open access developers in Telangana say that despite growing demand from energy-intensive industrial sectors, solar open access projects are not seeing much traction in the state due to a lack of policy clarity.

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