Delhi electricity body announces new tariff, says overall bills will reduce

In the new tariff schedule applicable from April 1, the DERC, though, hiked the fixed charges but reduced the per unit rates of electricity consumed.

Residents of the national Capital could find a dip in their electricity bills from April 1 as the Delhi Electricity Regulatory Commission (DERC) on Wednesday restructured its tariff order for 2018-19 with three changes, making it more consumption driven.

An employee works on electric pylons at a power station in Greater Noida on the outskirts of New Delhi on June 8, 2012. (Reuters File Photo)

But those with low consumption are unlikely to see any changes in their bills.

The power regulator increased fixed charges for every consumer, but brought down the energy cost or charge. It also revised the surcharge from 3.7% to 3.8%, which goes towards paying pension to former employees of power utilities. The reduction in energy charge is likely to reduce a consumer’s power bill, especially during the summer when electricity demand peaks.

Delhi power minister Satyendar Jain promised that no consumer will have to pay extra for power. “The new tariff will reduce electricity bills of every consumer by 7% to 8% on an average,” he said.

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Fixed charge, a part of the bill, is the cost a consumer has to pay even if the person does not use any unit of power. DERC increased this significantly in the range of ₹105 to ₹150. For instance, those who used to pay only ₹20 a month for one kilowatt (kW) of power for a sanctioned load of up to 2kW will have to pay ₹125.

Those with a load between 2kW and 5kW will pay ₹140, instead of the current charge of ₹35. Between 5kW and 15kW, the charge will be ₹175. At present, people pay ₹45 in this category.

Delhi has over 5.8 million power consumers, of which 4.7 million are domestic users. About 2.7 million domestic consumers have a sanctioned load of up to 2kW.

The fixed charge is unlikely to affect most consumers as the power regulator did a downward revision of energy charges ranging from .8 paise to Re 1.45 a unit. Energy charge is the variable part of an electricity bill as it depends on the number of units consumed.

DERC member BP Singh said the revised order will help liquidate a part of the ₹7,833 crore revenue gap of power discoms. Apart from the 3.8% surcharge, DERC levies another 8% surcharge on every bill to cover up the revenue gap.

In its previous tariff order announced in August 2017, the DERC had made the only change of introducing the 3.7% surcharge.

“The new order has been drafted in a way that consumers will see their bills go down during the summer. But during winters, when consumption is low, it could pinch a bit,” Singh said.

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Also, consumers getting a Delhi government subsidy will have to pay a bit more, he said. The government provides a subsidy of ₹2 and ₹2.97 to those who consume 0-200 units and 201-400 units respectively.

Singh explained that if someone with a sanctioned load of 2kW uses 100 units after the tariff hike, her subsidized bill will go up from about ₹313 to around ₹431 a month.

Still, people can gain. “If a consumer has a sanctioned load of 2kW and is consuming 400 units, he will gain the most out of all slabs with a saving of over 24% a month, including the subsidy and surcharges. From ₹1,380, the bill will go down to ₹1,043 a month,” said a Delhi government official, who doesn’t wish to be named.

In the non-subsidy category, if someone consumes 525 units and has a sanctioned load of 5kW he would be paying ₹3,484 a month, instead of ₹3,583 under the existing tariff, Singh said.

Explaining the reason for increasing fixed costs, he said it was done to plug power theft that puts an additional burden of 10% on tariff orders currently.

According to him, the move will help keep bulk consumers intact within the city’s distribution network. “Because until now we had such low fixed costs, bulk consumers like the railways moved out. Distribution companies, in such cases, have to pay fixed costs to generation and transmission companies, which in turn reflect in consumer tariffs. This will reduce now,” he said.