TERC Proposes 2026 Amendment To Ensure Fair Electricity Billing And 18% Interest On Excess Payments In Telangana

The Telangana Electricity Regulatory Commission has released a draft proposal for the “Third Amendment to the Electricity Supply Code Regulation, 2026,” aiming to update existing rules and bring more fairness to electricity billing practices in the state. The proposal revises parts of the long-standing Principal Regulation, originally issued in 2004, which governs key aspects of electricity services such as billing cycles, recovery of charges, disconnection procedures, and prevention of meter tampering.

The regulation has evolved over time, with earlier amendments made in 2006 and 2013. After the formation of Telangana in 2014, the Commission adopted these rules to ensure continuity in electricity governance. The current amendment process began after a proposal from the Southern Power Distribution Company of Telangana, which highlighted an issue related to unequal interest rates applied in billing practices.

According to the utility, consumers are charged a higher interest rate for delayed payments, while significantly lower or no interest is paid to consumers in cases where billing errors lead to excess payments. Taking note of this imbalance, the Commission has proposed changes to ensure uniformity and fairness for both consumers and distribution companies.

A key change in the draft amendment is related to Clause 4.7.3 of the Principal Regulation. Under the proposed rule, if a consumer raises a complaint and the electricity licensee later finds that the bill was incorrect, the company must issue a revised bill. This corrected bill must include a new payment due date, giving the consumer at least seven days from the date of receiving the revised bill to make the payment.

The draft also clearly addresses the issue of overpayments. If a consumer has already paid more than required due to a faulty bill, the excess amount must be returned through adjustments in future bills. Importantly, the amendment introduces a provision that requires the licensee to pay interest on such excess amounts. The interest rate has been set at 18 percent per annum, bringing it in line with the rate charged on late payments by consumers.

The Commission has invited feedback and suggestions from stakeholders, including consumers and power utilities, before finalizing the amendment. This step is intended to ensure that the final regulation balances the interests of all parties involved.

Once finalized, the amended regulation will apply across the state of Telangana and will come into effect after its official publication in the state gazette. The draft was formally issued and signed by the Commission Secretary in Hyderabad on April 13, 2026.