BYPL Seeks Approval For Differential PPAC Levy To Recover Power Purchase Costs For Q1 FY 2024-25

A petition was recently filed by BSES Yamuna Power Ltd. (BYPL) under Section 62 (4) of the Electricity Act, 2003, and Regulation 134 of the Delhi Electricity Regulatory Commission (Terms and Conditions for Tariff Determination) Regulations, 2017. The petition seeks approval to levy Differential Power Purchase Adjustment Cost (PPAC) for the power purchase costs incurred during the first quarter of the financial year 2024-25 (April to June 2024).

In the petition, BYPL has requested the commission to allow a PPAC levy of 8.75% on consumer bills, effective from August 1, 2024, for three months. Additionally, BYPL has requested approval to levy a differential PPAC of 30.41% or 32.64%, depending on the method used to calculate the power purchase cost, including arrears related to the Badarpur Thermal Power Station (BTPS) from April to June 2024.

The company has submitted that it is a distribution licensee under the Electricity Act and supplies power to parts of North and North-West Delhi. BYPL has calculated the PPAC at 39.16% using the commission’s methodology or at 41.39% using the Ministry of Power’s methodology, both inclusive of BTPS arrears and other unrecovered PPAC costs.

BYPL explained that arrears of ₹119 crores were paid to NTPC for BTPS during this period, affecting the overall PPAC calculation. The commission’s order from September 2021 allowed for a PPAC of 7.43%, but due to a revenue gap, additional PPAC was levied. An unrecovered amount from the previous quarters has also contributed to the differential PPAC being requested now.

The petition highlights that BYPL began charging the 8.75% PPAC from August 1, 2024, as permitted by the commission’s business plan regulations and previous orders. BYPL provided calculations to justify its PPAC requests and submitted required documents, including audited power purchase cost statements.

The commission acknowledged the petition and admitted it on September 18, 2024, after reviewing additional submissions from BYPL. The review included verification of various arrears paid by BYPL and coal blending details. A prudence check was also conducted to ensure accuracy.

The commission has now allowed BYPL to recover a PPAC of 30.34% from September 21, 2024, for three months, ending on December 20, 2024. Any surplus or deficit will be adjusted during the annual true-up, with a carrying cost, based on the final verification of power purchase costs.