Power Regulator Slashes UPCL's Rs 5,900 Crore Additional Tariff Claim After Review
Uttarakhand's power regulator has cut down UPCL's Rs 5,900 crore additional revenue claim tied to the state's 2000 power sector split from Uttar Pradesh, after consumer groups warned of a tariff burden.
Current Summary
The Uttarakhand Electricity Regulatory Commission (UERC) has ruled on a petition filed by Uttarakhand Power Corporation Limited (UPCL) seeking approximately Rs 5,900.01 crore in additional Aggregate Revenue Requirement, arising from the division of assets and liabilities between Uttar Pradesh Power Corporation Limited and UPCL after Uttarakhand's creation in November 2000. A division scheme signed in 2003 had put Gross Fixed Assets at Rs 1,058.18 crore, but the formal Transfer Scheme was notified only in March 2022. UPCL's claim included Rs 936.37 crore under components such as depreciation, return on equity and interest on normative loans, plus Rs 4,963.65 crore sought as carrying cost for the intervening years. The Industries Association of Uttarakhand and other stakeholders objected during consultations, warning the full claim could impose a significant tariff burden on consumers. After a prudence check, UERC substantially reduced the amount it approved, though the final approved figure was not available in source material.
What We Know
- UPCL sought roughly Rs 5,900.01 crore in additional ARR linked to the 2000 UP-Uttarakhand power sector split.
- The Transfer Scheme was notified only in March 2022, more than two decades after the 2003 division agreement.
- UERC conducted a prudence check and substantially cut the amount sought by UPCL.
- Industry stakeholders had warned the full claim could burden consumer tariffs.
What Is Still Unclear
- The exact final amount UERC approved.
- Whether or how this will translate into tariff changes for consumers.
- Timeline for implementation of the order.
What Changed
- 6 Oct, 08:41 amSignal detected: Power Regulator Slashes UPCL's Rs 5,900 Crore Additional Tariff Claim After Review
Background
Uttarakhand was carved out of Uttar Pradesh in November 2000, and the division of UP's erstwhile power utility assets and liabilities between the two states has remained a long-running financial dispute.