Electricity consumers of the capital Delhi may once again be shocked by expensive electricity bills. Delhi Electricity Regulatory Commission (DERC) has approved the increase in Power Purchase Adjustment Cost i.e. PPAC. After this, power companies will be able to charge additional 7 to 8 percent PPAC from consumers in the upcoming bills. There was a demand from the power companies to increase the existing PPAC. The companies had proposed to increase the PPAC from 23 to 31 percent.
Actually, BSES Rajdhani Power Limited (BRPL) had put forward the demand to DERC to increase the PPAC to 31.64 percent, BSES Yamuna Power Limited (BYPL) to 24.02 percent and Tata Power Delhi Distribution Limited (TPDDL) to 23.71 percent. After considering the demand, the Regulatory Commission has approved separate PPAC increases for the three discoms. Under this, permission has been given to BRPL to increase PPAC by 7.94 percent, BYPL by 7.43 percent and TPDDL by 8.50 percent.
After this increase, a total PPAC of 17.94 percent will be applicable on BRPL consumers, 17.43 percent on BYPL consumers and 18.50 percent on TPDDL consumers in the next electricity bill. This may increase the total amount of electricity bill. Electricity companies say that this increase will not put much burden on consumers who use up to 200 units of electricity. However, the impact of the PPAC increase may be more visible on the bills of consumers with high power consumption.
All three major power companies had proposed
Earlier, PPAC was reviewed every three months by the Delhi Electricity Regulatory Commission (DERC). Now, by making changes in the system, PPAC is being reviewed every month. Under this process, in July, the three major power distribution companies of Delhi had proposed to DERC to increase the PPAC. The power companies had told the Commission that the cost of purchasing power is continuously increasing and they have to pay more charges for purchasing power than before. The companies had sought permission to increase PPAC to compensate for this additional expense.
Electricity bill may increase by Rs 25 to 60
The effect of increase in PPAC will be visible in the upcoming electricity bills. According to sources, after this decision, each consumer bill may increase by about Rs 25 to Rs 60. However, this will not directly impact consumers using up to 200 units of electricity, as PPAC is not imposed in this category as the electricity bill is zero. It is noteworthy that earlier in the month of June also, PPAC was increased. At that time, Delhi Energy Minister Ashish Sood had said that despite the increase in global fuel costs, the Delhi government will ensure that the interests of consumers are protected.
PPAC is a legal system
The Energy Minister had clarified that Power Purchase Adjustment Cost i.e. PPAC is a statutory provision under the electricity laws of the country. This is not a new arrangement. Under this, power distribution companies are allowed to make adjustments in prices every month according to fluctuations in the cost of fuel and power purchase. He had said that due to the West Asia crisis and other international circumstances, there has been an extraordinary increase in global fuel prices. In such a situation, changes in PPAC have become necessary to accommodate the increased cost of power purchase.
What is PPAC?
PPAC i.e. Power Purchase Adjustment Cost is the additional fee which is charged from consumers to compensate for the change in the cost of power purchase. When the purchase cost of power companies increases, some part of it is recovered from consumers through PPAC.
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