The Delhi Electricity Regulatory Commission (DERC) has notified the Delhi Electricity Regulatory Commission (Terms and Conditions for Determination of Tariff) (Second Amendment) Regulations, 2026, bringing a new system to adjust electricity bills in line with changing power costs. The rules will come into effect from June 1, 2026, and aim to make billing more responsive, transparent, and efficient for both consumers and distribution companies.
A key feature of the amendment is the introduction of the Fuel and Power Purchase Adjustment Surcharge (FPPAS). This surcharge reflects the variation in the cost of supplying electricity due to changes in fuel prices, power purchase expenses, and transmission charges compared to previously approved base costs. With this mechanism, distribution companies (DISCOMs) will be able to calculate and apply the surcharge automatically every month. Earlier, such adjustments required regulatory approval, but the new system removes that step while still keeping an annual verification process known as a “true-up.”
The regulation also defines a clear billing timeline using an “n+2” cycle. This means that any cost changes in a particular month will be passed on to consumers after two months. For example, variations in April will appear in June bills. This approach ensures that billing remains systematic and predictable.
To protect consumers from sudden spikes in electricity charges, DERC has introduced a cap on the surcharge. The FPPAS cannot exceed 10 percent of the total energy and fixed charges in a bill. If the calculated surcharge is higher than this limit, the extra amount will be carried forward and adjusted in later months within the same financial year. This step is expected to reduce the burden of sharp cost increases on consumers.
The regulations also bring strong accountability measures for DISCOMs. If a company fails to apply a positive surcharge within the specified time, it will lose the right to recover that amount in the future. At the same time, if there is overcharging or if a negative surcharge is not refunded to consumers, the excess amount will be recovered from the DISCOM with an additional penalty of 1.20 times the standard carrying cost during the annual review process.
Transparency is another important focus of the new rules. DISCOMs are required to publish the FPPAS calculation formula and monthly details on their websites. They must also submit quarterly certificates from statutory auditors to confirm the accuracy of the calculations.
To ensure smooth implementation, DISCOMs must adopt a unified billing system that supports interoperability or uses open-source platforms. The Commission has also specified interim surcharge rates for utilities, including TPDDL at 7.24 percent, BRPL at 5.76 percent, BYPL at 2.96 percent, and NDMC at 8.75 percent, until the new system becomes fully operational.
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