DERC Allows Higher Power Cost Recovery For Delhi Discoms Amid Rising Electricity Purchase Expenses

The Delhi Electricity Regulatory Commission (DERC) has provided temporary relief to the capital’s power distribution companies by allowing them to recover a higher Fuel and Power Purchase Adjustment Surcharge (FPPAS) from consumers. The decision was issued through an order dated June 10, 2026, in response to a sharp rise in power procurement costs faced by the utilities.

Under the existing Delhi Electricity Regulatory Commission Tariff Regulations, distribution companies are permitted to recover a maximum FPPAS of 10% in any single billing cycle. However, the city’s three major power distribution companies—BSES Rajdhani Power Limited (BRPL), BSES Yamuna Power Limited (BYPL), and Tata Power Delhi Distribution Limited (TPDDL)—approached the Commission in May 2026 seeking relaxation of this limit.

The companies informed the regulator that their actual power purchase costs for April 2026 had increased significantly compared to the base costs approved under the tariff order issued in 2021. According to their submissions, BRPL required an FPPAS of 31.55%, while BYPL estimated its requirement at 35.26%. TPDDL stated that its actual requirement was around 16%.

After reviewing the requests, the Commission exercised its powers to relax regulatory provisions and remove operational difficulties. It allowed BRPL to recover an additional 7.94% over the existing 10% cap, taking its total permissible FPPAS recovery to 17.94%. Similarly, BYPL was permitted an additional 7.43%, raising its total recoverable surcharge to 17.43%.

For TPDDL, the Commission approved an enhanced recovery rate but limited the total FPPAS recovery to 16%, matching the company’s actual claim. The regulator noted that TPDDL must first submit a Statutory Auditor Certificate along with a supporting affidavit confirming its April 2026 power purchase figures before implementing the surcharge increase.

The order was signed by Commission members Surender Babbar and Ram Naresh Singh. The relaxation has come into effect immediately and will be applicable on a month-to-month basis until further orders are issued by the Commission. All other provisions of the tariff regulations will continue to remain unchanged.