Punjab: Fuel cost hike offsets recent power tariff reduction

  • Vishal Rambani, Hindustan Times, Patiala
  • Updated: May 18, 2015 19:23 IST

Barely a week after announcing a token power reduction, the Punjab State Power Corporation Limited (PSPCL) has imposed 4 paise per unit as fuel cost adjustment (FCA) on consumers, offsetting the tariff reduction that had come after eight years.

While the FCA has done away with the reduction in the first 100 units of household consumption announced by the power regulator, it has increased tariff for all other categories by 4 paise per unit, which was kept unchanged by the regulator in its May 6 tariff order.

The PSPCL issued commercial orders on May 15 to impose 4 paise per unit for the metered supply and Rs 2 per break horse power (BHP) per month on unmetered supply (agriculture sector). The power regulator on May 13 had allowed the PSPCL to impose the levy of fuel surcharge.

FCA surcharge is applicable to all categories of consumers -- domestic, industry and commercial. It will be charged with retrospective effect from October 2014 and will also be levied on the current fiscal on all consumers.

In the May 6 order, the power regulator had reduced the tariff by 4 paise for the first 100 units’ consumption for households, while it had not altered the tariff for other categories.

With the fuel cost adjustment, not only the PSPCL has taken the gain of power tariff reduction from consumers for the first 100 units, it has also increased the rate by 4 paise per unit.

The power regulator has allowed the PSPCL to recover Rs 36.83 crore in the FCA on account of increase in coal and power purchase cost, a PSPCL official said.

The FCA surcharge pertains to the third quarter of 2014-15 (October to December 2014) and will be recovered from consumers from April 1 to June 2015, the official said.

Ironically, the PSPCL last summer had faced a major coal crisis, as the coal suppliers had demanded high rates after curtailing the coal supplies. The PSPCL then had purchased coal from Coal India Limited, besides buying power from outside as it was unable to run its thermal plants.

FCA is levied to recover any increase in coal and power purchase cost which is required to be collected from consumers.

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