Telangana Fixes Additional Surcharge For Open Access Consumers At ₹1.98/kWh

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Telangana State Electricity Regulatory Commission (TSERC) has officially announced the fixation of the Additional Surcharge (AS) for Open Access (OA) consumers for the second half of the financial year 2023-24. The surcharge has been set at ₹1.98 per kilowatt-hour (kWh) and will be applicable from October 1, 2023, to March 31, 2024.


This significant decision by TSERC comes following the submission of petitions by the Southern Power Distribution Company of Telangana Limited (TSSPDCL) and the Northern Power Distribution Company of Telangana Limited (TSNPDCL), collectively referred to as “TSDISCOMs.” The petitions aimed to determine the AS for OA consumers, and this move is in complete adherence to the directives outlined in the Commission’s Order dated September 18, 2020. These directives align with the provisions of the Electricity Act of 2003 and the Tariff Policy of 2016.


Original Petitions and Concerns


Originally, these petitions were expected to be filed by May 31, 2023, and the TSDISCOMs did so within the prescribed timeframe, proposing an Additional Surcharge rate of ₹1.07 per kWh for H2 FY 2023-24.

However, concerns arose regarding the feasibility and perceived irrationality of these proposed Additional Surcharge figures. In response, TSDISCOMs submitted modifications to the existing methodology, basing their calculations on actual data from H2 FY 2022-23, following directives from the Commission. Under this revised methodology, they sought approval for an Additional Surcharge rate of ₹3.43 per kWh for H2 FY 2023-24.

Modifications and Adjustments

These modifications consider various factors such as stranded capacity, fixed charges to generators, transmission costs, and distribution wheeling charges for the high-tension (HT) network. Following these adjustments, the net stranded charges were determined to be ₹44.32 crore, leading to the proposed Additional Surcharge.

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TSDISCOMs emphasized that the fixed charges for H2 FY 2022-23 were provisional and subject to change upon finalization in audited accounts. They requested the Commission to factor in any such variations in subsequent filings.

Commission’s Review and Adjustments

In response, the Commission reviewed the submissions, took stakeholder input into account, and reiterated its commitment to adhere to the methodology established in the Suo Moto Order dated September 18, 2020. However, the Commission acknowledged changes in the inputs used for the Additional Surcharge formula, including the netting of time-block-wise short-term purchases and sales of surplus power and limiting distribution charges to the HT network.

Adjustments in Capacity and Charges

Upon careful examination of TSDISCOMs’ 15-minute time-block data from October 2022 to March 2023, the Commission noticed that TSDISCOMs had taken averages of 15-minute time-block data on a day-wise and month-wise basis, and then for the entire six-month period. According to the approved methodology, such intermittent averages should not have been applied. The Commission, therefore, approved the long-term available capacity at 9198.60 MW instead of the initially claimed 9191.58 MW.

Additionally, TSDISCOMs had engaged in short-term power purchases and the sale of surplus power during specific time blocks when surplus capacity was available. As a result, the Commission adjusted the stranded capacity to 46.22 MW, as opposed to the initial 47.42 MW claim.

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Final Determination and Implementation

Regarding fixed charges, TSDISCOMs had initially reported ₹6,574.36 crore for the period from October 2022 to March 2023. However, the Commission noted that the total fixed charges incurred by TSDISCOMs for the entire fiscal year 2022-23 were ₹11,289.12 crore, with ₹5,589.64 crore already considered while determining the Additional Surcharge for H1 FY 2023-24. Consequently, the Commission considered the balance of ₹5,699.48 crore towards TSDISCOMs’ fixed costs for H2 FY 2023-24, resulting in an average fixed charge of ₹0.62 crore per MW.

Transmitting charges amounting to ₹2,483.71 crore were claimed by TSDISCOMs for the period from October 2022 to March 2023, which the Commission accepted. The Commission also noted the scheduled energy of 39,635.68 MU for this period, with the total energy scheduled for TSDISCOMs in FY 2022-23 being 75,311.05 MU. The Commission had already considered 35,288.87 MU when determining the Additional Surcharge for H1 FY 2023-24, leaving 40,022.18 MU as the scheduled energy for H2 FY 2022-23. Accordingly, the transmission charges per unit were calculated at ₹0.62 per kWh, slightly lower than the claimed ₹0.63 per kWh.

Distribution charges were determined to be ₹0.18 per kWh for the HT network (excluding the low-tension network). Combining transmission and distribution charges, the total charges per unit amounted to ₹0.80 per kWh. TSDISCOMs reported Open Access sales of 132.30 MU, which the Commission verified and accepted.

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Conclusion and Application

Based on the methodology outlined in the September 18, 2020 order, the Commission approved an Additional Surcharge of ₹1.98 per kWh for H2 FY 2023-24. This surcharge will be effective from October 1, 2023, to March 31, 2024.

The Additional Surcharge approved by the Commission will apply to consumers of TSDISCOMs who receive power through Open Access from sources other than their respective TSDISCOMs. However, it will not apply to open-access consumers using power from their Captive Power Plants (CPPs) for captive consumption. The application of the Additional Surcharge for Green Energy Open Access consumers will follow the Terms and Conditions of Open Access Regulations set by the Commission.

In conclusion, this determination of the Additional Surcharge seeks to strike a balance between the interests of TSDISCOMs and Open Access consumers while ensuring a fair and transparent methodology for cost allocation.

Please view the document below for more details.

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