The Himachal Pradesh Electricity Regulatory Commission (HPERC) has finalized the Second Amendment to the Himachal Pradesh Electricity Regulatory Commission (Deviation Settlement Mechanism and Related Matters) Regulations, 2025. This decision was taken on July 15, 2025, after a detailed review of the feedback received on the draft version of the amendments. The primary aim of the revised regulations is to bring the state’s mechanism in line with the Central Electricity Regulatory Commission (CERC) Deviation Settlement Mechanism (DSM) Regulations, 2024.
The amendment process was initiated with public notices in “Dainik Bhaskar” and “The Tribune” on May 2, 2025, inviting objections and suggestions. The draft document was made available on HPERC’s website, and stakeholders were asked to submit their comments by May 28, 2025. Several key stakeholders participated in the consultation process. These included the Himachal Pradesh State Electricity Board Limited (HPSEBL), the Himachal Pradesh State Load Despatch Centre (HPSLDC), and Dr. Anoop Singh, Professor at IIT Kanpur.
A public hearing was held on July 1, 2025, where stakeholders, including HPSEBL and HPSLDC, restated their written views. The Directorate of Energy stated that they had no objection to the proposed amendments. The Commission carefully examined all submissions before finalizing the amendments.
One of the main topics of debate was the definition of the term “Contract Rate.” Directorate of Energy suggested that the definition should be expanded to reflect the weighted average prices from multiple exchanges and contracts to avoid any misinterpretation in the market. He also recommended including a reference to multiple exchanges for clarity in the case of several transactions. However, the Commission decided to retain the proposed definition, explaining that it already aligns with the CERC DSM Regulations, 2024. The Commission further highlighted that CERC had already amended this definition in December 2024 to include sales through open access, making the terms more inclusive.
Another issue raised during the consultation was regarding the deviation charges under Regulation 7. HPSLDC proposed adjusting the deviation charge limits for sellers and buyers to ensure complete recovery of DSM charges. HPSEBL suggested implementing a fixed deviation volume of 40 MW for schedules under 400 MW, especially during the winter season. The Commission declined both suggestions, stating that such changes could create possibilities for gaming or leave DSM charges unrecovered from state utilities. They added that Regulation 13 of the Principal Regulations already has provisions to review deviation charges in case of notable gaps between billed and received amounts.
Directorate of Energy also raised additional points such as the practicality of settling multiple contracts through a single meter and the difference in charges between CERC and HPERC. The Commission acknowledged these points but held that consistency with CERC, along with room for state-specific considerations, remains the guiding principle. Again, they referred to Regulation 13 as a mechanism to address any substantial inconsistencies.
A new term, “MSW seller,” was also introduced. This refers to power generators using Municipal Solid Waste and Refuse Derived Fuel, aligning HPERC’s definitions with those of CERC. This inclusion is expected to offer more clarity for stakeholders operating in this sector.
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