Draft GERC Fourth Amendment Regulations 2024 Changes in Cost Recovery and Supply Charges

The Gujarat Electricity Regulatory Commission (GERC) has introduced amendments to its regulations regarding the recovery of costs associated with providing electricity supply and other miscellaneous charges. This move, detailed in the Gujarat Electricity Regulatory Commission (Licensee’s Power to Recover Expenditure Incurred in Providing Supply and Other Miscellaneous Charges) (Fourth Amendment) Regulations, 2024, is designed to update the existing framework initially established by the 2005 regulations.

The new regulations come into effect from the date they are published in the Official Gazette and apply statewide across Gujarat. They are a result of the powers granted under Section 181 (2) (u) and Sections 45 and 46 of the Electricity Act, 2003. The primary change involves the modification of Clause 4.2 (ii) in Chapter IV of the principal regulations. This clause previously outlined how costs for electrical installations and extensions, such as Distribution Transformers (DTR) and switchgear, were to be estimated. Under the new amendment, the cost estimate for laying or extending High Tension (HT) lines needed to supply electricity to applicants will now be calculated on a per-kilometer basis. This estimation will be based on the latest cost data published by the Distribution Licensee.

The amendment specifies that the Distribution Licensee can recover these costs from all applicants except for certain categories. These exceptions include agricultural consumers (excluding those under special schemes like the “Tatkal Scheme”), water works and sewerage pumps operated by local authorities other than Municipal Corporations, domestic consumers, and Low Tension (LT) commercial consumers.

This update follows requests from various consumer organizations to increase the threshold limit for LT connections from 100 kVA/kW to 150 kVA/kW. These requests were forwarded to the Electricity Supply Code Reform Project (ESCRP). Additionally, the Ministry of Power (MoP) had communicated to facilitate reforms for Distribution Companies (DISCOMs) related to new connections, aligning with the Ease of Doing Business and Ease of Living initiatives. The MoP’s letter highlighted that the Electricity (Rights of Consumers) Rules, 2020, issued by the Government of India, already cover provisions to streamline new connection releases. Rule 13 of these rules specifies that connection charges for loads up to 150 kW—or any higher load as specified by the Commission—should be fixed based on the load, connection category, and average connection costs of the distribution licensee. This rule aims to avoid individual site inspections and demand charge estimations for each new connection request.

To enhance ease of doing business, DISCOMs have been encouraged to provide LT connections for loads up to 150 kW. In response to these developments, the ESCRP recommended in its 26th Meeting that Clause 3.2 of the Supply Code, 2015, be amended to allow LT consumers to increase their connection threshold limit from 100 kVA/kW to 150 kVA/kW.

As a result, GERC is now moving to amend the Gujarat Electricity Supply Code and Related Matters Regulations, 2015. The necessary amendments to the GERC (Licensee’s Power to Recover Expenditure Incurred in Providing Supply and Other Miscellaneous Charges) Regulations, 2005, are being made to align with these changes in the Supply Code. This step aims to implement the revised regulations effectively and accommodate the increased threshold for LT connections, ultimately improving the efficiency and ease of obtaining new electricity connections in Gujarat.