KERC Hikes Tariff for FY 15-16 (Open Access Getting Costlier)

The Karnataka Electricity Regulatory Commission (KERC) has approved the new tariff and open access charges for FY 15-16. The tariff for industrial consumers has been increased by 15 paisa per unit, while increase in the tariff for commercial consumers  is 20 Paisa per unit. The new tariff will be effective from 1st April 2015 onwards.

The new tariff is directly going to affect the open access transactions in the state of Karnataka, as the cross subsidy (CSS) for the open access consumers has been increased unexpectedly.  HT industrial consumers connected at 11/33 KV paying CSS of 7 paisa per unit has to pay almost 63 paisa per unit which is 9 times of current CSS, which makes the purchase of power from Independent power producers(IPP, Bilateral contracts) and power exchange(PXs, Bidding for power) an unviable option. It also opens up the opportunities for solar and group captive transactions, where CSS is zero, making such transactions most viable options in the state.

Cross Subsidy Surcharge: 

 The summary of tariff approved is given in the table below:

Industrial Tariff:  

Commercial Tariff: Commercial consumers comprising of hotels, malls, commercial buildings etc. have to pay extra 20 paisa per unit consumed by them. Commercial consumers are the highest paying consumers and this increase in the tariff is expected to impact them.

Open Access Charges:

Losses: The commission has defined wheeling loss for HT consumer at 3.79% and wheeling loss LT consumers at 8.49%.

Wheeling Charges: 

Wheeling and Banking Charges for Renewable Energy Sources: The Commission vide order dated 04.07.2014 has determined the wheeling and banking charges which is applicable to wind, mini-Hydel, bagasse based co-generation and biomass projects will continue, and for solar energy based projects, the Commission vide Order dated 18.08.2014 has exempted Solar projects in the state for 10 years is continued.

The relevant orders can be accessed here.

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