UPERC Keeps Tariffs Unchanged For 6th Year, Updates Clean Energy Charges In Uttar Pradesh

The Uttar Pradesh Electricity Regulatory Commission has issued its detailed Order on the Aggregate Revenue Requirement and Tariff for the five state distribution companies for the fiscal year 2025-26. The document also finalizes the True-up for 2023-24 and the Annual Performance Review for 2024-25. After conducting extensive public hearings and reviewing the comments from various stakeholders and the State Advisory Committee, the Commission reached a decision aimed at ensuring stability for electricity consumers across the state. One of the most important outcomes of the Order is that electricity tariffs will remain unchanged for the sixth year in a row. This means households, commercial users, industries, and other consumer categories will not face any tariff hike in the upcoming financial year.

The Commission took this decision even though the distribution companies had projected a revenue gap of more than ₹7,710 crore for the next year. The regulatory body noted that this gap could be managed easily because the state’s distribution sector is expected to have a large accumulated regulatory surplus of over ₹18,592 crore by the start of the new fiscal year. Since this surplus is sufficient to cover the projected shortfall, the Commission decided that consumers should not be burdened with any additional tariff increase at this time.

Along with tariff stability, the Order places strong emphasis on improving operational efficiency across all distribution companies. The Commission has directed UPPCL and the discoms to significantly reduce Distribution Losses over the next several years. At present, the system-wide distribution loss stands at 13.78 percent for 2024-25, and the Commission expects this to be gradually reduced to 10.74 percent by the end of the 2029-30 control period. Each distribution company, including DVVNL, has been given individual targets to bring down losses. These improvements are important because the cost of supplying electricity, which is estimated at ₹8.18 per unit, is still higher than the average billing rate approved at ₹7.61 per unit. Reducing losses will help bring operational costs under better control and make the supply system more efficient.

The Commission has also made key changes linked to clean energy. The Green Energy Tariff has been slightly revised. For high-voltage consumers who choose to use green power, the extra charge has been reduced from ₹0.36 to ₹0.34 per unit. A new rate of ₹0.17 per unit has been introduced for low-voltage consumers who opt for green energy. These adjustments are expected to encourage more consumers to shift toward cleaner power sources. The new Rate Schedule also introduces updated billing conditions, including the requirement for consumers to maintain a power factor of at least 0.90. If the power factor falls below this level, consumers may face penalties. The Order also prescribes a clear structure for late payment surcharges. For delays of up to three months, the surcharge will be 1.25 percent per month. If the delay extends beyond three months, the surcharge rate will increase accordingly as defined in the schedule.

Overall, the Commission has approved a total Aggregate Revenue Requirement of ₹86,183.29 crore for the five distribution companies for the year 2025-26. This ensures that the utilities will have adequate financial resources to operate and maintain the electricity network across the state. The Order reflects a balance between maintaining tariff stability for consumers and pushing the distribution companies to improve efficiency, adopt cleaner energy practices, and strengthen the overall power supply system.