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Diwali gift in store, no power tariff hike likely in UP for 6th year in a row
Uttar Pradesh consumers will enjoy no power tariff hike for the sixth year in a row, expected to be confirmed by the UPERC between October 8-10.
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Power consumers in Uttar Pradesh are set to receive a Diwali gift in the form of no tariff hike for the sixth consecutive year. Unless there are last-minute changes “for some special reasons”, the Uttar Pradesh Electricity Regulatory Commission (UPERC) is expected to retain the existing power tariff.
The commission is likely to announce its annual tariff order for the year 2025-26 between October 8 and 10 having already considered views from all stakeholders. People in the know disclosed that the order had been finalsed and, if issued in its current form, Uttar Pradesh would perhaps be the only state in the country to have kept power tariffs unchanged for six straight years.
“The commission has finalised the tariff order and is likely to announce it by the end of next week, offering a Diwali bonanza to consumers — unless it decides to revise the order at the last minute for some special reasons, though that possibility appears unlikely at present,” they said.
A few days ago, energy minister AK Sharma quietly held a high-level meeting with UPERC chairman Arvind Kumar at a guesthouse. The meeting was also attended by additional chief secretary (energy) Narendra Bhushan and UP Power Corporation Ltd (UPPCL) chairman Ashish Goel.
What exactly transpired in the meeting is not known. While there was speculation that it was linked to the proposed privatisation of the Agra and Varanasi discoms, officials familiar with the development said discussions were mainly about the forthcoming tariff order and not privatisation as such.
Under the regulatory norms, UPPCL currently shows a revenue surplus of about ₹15,000 crore, which technically rules out any tariff hike by the regulator. However, the corporation has argued that at existing tariff levels it would suffer losses, contending that the surplus exists only because the commission disallowed or undervalued several legitimate expenses.
Officials also indicated that private companies interested in taking over power distribution operations after the unbundling of the Agra and Varanasi discoms covering 42 districts had been lobbying for a tariff hike to make the arrangement more financially attractive.
They did not rule out the possibility of the issue of private firms’ concerns related to the tariff having come up informally during the discussion in the minister’s meeting.
“So, unless the state government directs the UPERC to revise tariffs to address the concerns of prospective bidders or the concerns of the UPPCL itself, whose cumulative deficit has reached beyond ₹1 lakh crore, consumers in Uttar Pradesh are all set to receive a Diwali gift in the form of zero tariff increase,” an official said.
The last power tariff hike in the state was implemented in September 2019, bringing about an average increase of around 12%. Since then, the regulator has maintained the same rates for all categories of consumers, providing sustained relief to households and industries for six consecutive years.
