The Telangana Electricity Regulatory Commission (TGERC) has fixed the Average Pooled Power Purchase Cost (APPC) for Telangana’s distribution companies at Rs. 5.330 per kWh for the financial year 2025-26. The order was issued by a three-member commission comprising Chairman Dr. Justice Devaraju Nagarjun, Technical Member Raghu Kancharla and Finance Member Cherukuri Srinivasa Rao.
The decision follows a petition and interlocutory application jointly filed by the Southern Power Distribution Company of Telangana Ltd. (TGSPDCL) and Northern Power Distribution Company of Telangana Ltd. (TGNPDCL). The distribution companies had sought determination of the APPC based on their power purchase costs during 2024-25.
APPC represents the weighted average cost paid by distribution licensees for electricity procured from long-term and medium-term suppliers, including self-generation. The calculation excludes electricity purchased from renewable energy sources, liquid fuel, short-term arrangements and traders.
The APPC is an important regulatory benchmark as it determines the energy charges applicable to green energy open access consumers, open access generators affected by grid breakdowns and renewable energy generators operating under long-term renewable energy certificate agreements.
Initially, TGSPDCL and TGNPDCL had proposed an APPC of Rs. 5.11 per kWh, based on their preliminary power purchase figures for 2024-25. The utilities also sought condonation of the delay in filing the petition, stating that their audited annual accounts for the financial year had taken longer than expected to finalize. Under the applicable regulations, the filing was due by April 30. TGERC accepted the explanation and condoned the delay.
During its detailed review, the commission examined the audited accounts and power purchase costs associated with central generating stations, independent power producers, state-owned TGGENCO plants and other suppliers.
The commission identified an important omission in the utilities’ original calculation. An additional pension liability of Rs. 1,251.26 crore for 2024-25 had not been included in the initial APPC computation. TGERC incorporated this liability into the final calculation along with power purchase expenses, water charges, fixed costs and variable costs.
According to the regulatory assessment, the distribution companies recorded total power drawal of more than 57.11 billion kWh, while aggregate power purchase expenses exceeded Rs. 30,443.97 crore.
After considering the audited financial information and applicable cost components, TGERC determined the final APPC at Rs. 5.330 per kWh for 2025-26. The commission approved the petition and accompanying interlocutory application without imposing any costs.
The decision provides a clear benchmark for electricity charges associated with open access and renewable energy transactions in Telangana during the 2025-26 financial year.
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