Power bills rise as Telangana DISCOMs recover True-Up charges

Hyderabad: Domestic electricity consumers are feeling the pinch of True-Up charges added to their power bills. The additional charges are being collected for electricity consumed during 2022-23 and 2023-24. Depending on their consumption during these financial years, consumers are being charged between Rs 25 and Rs 50 in their current monthly bills. The failure of power distribution companies (DISCOMs) to accurately estimate power procurement costs has now resulted in an additional financial burden on consumers.

A domestic consumer in Rajeev Nagar, Yousufguda, was charged Rs 27 towards True-Up charges at the rate of 30 paise per unit for the average electricity consumed during 2022-23. The rate of 30 paise per unit will apply only for October 2027. It will increase to 50 paise per unit in subsequent monthly bills. The collection of these charges will continue for the next 29 months under the TGSPDCL jurisdiction and 26 months under the TGNPDCL jurisdiction.

The Telangana State Electricity Regulatory Commission (TGERC) has approved the recovery of Rs 7,635.22 crore towards True-Up charges for the financial years 2022-23 and 2023-24. The government is required to bear Rs 2,214.99 crore, which is attributed to agricultural consumption. The remaining Rs 5,420.23 crore is being recovered from other electricity consumers.

Why are True-Up charges levied?

DISCOMs generally estimate power procurement costs and submit proposals to the Electricity Regulatory Commission for tariff determination. However, when the actual cost of procuring electricity exceeds the initial estimates, the difference is adjusted at a later stage through a process known as True-Up.

It is a mechanism to calculate and adjust discrepancies in costs and revenues from previous financial years. The government may present this as an adjustment towards past expenses rather than a regular increase in electricity tariffs.

However, consumers are ultimately bearing the additional financial burden. The State government’s decision to pass on the financial burden to consumers has drawn objections. Among the different consumer categories, middle-income households are feeling the impact the most.

Experts have pointed out that DISCOMs are required to file True-Up petitions for each financial year before the Electricity Regulatory Commission within the stipulated time. Keeping True-Up petitions pending for several years and seeking recovery of the accumulated amounts in subsequent years is not acceptable, they observed.