Why cheaper power in Jharkhand may still not lower electricity bill
The Jharkhand State Electricity Regulatory Commission (JSERC) has amended its tariff regulations to allow distribution licensees to retain savings arising from lower power procurement costs instead of passing them on to consumers, provided the utility has an approved and subsisting regulatory asset or revenue gap during the same financial year.
The amendment introduces Clause 10.46a to the JSERC (Terms and Conditions for Determination of Distribution Tariff) Regulations, 2025. The clause states:
“Further, any decrease in cost of power supplied to consumers during any month due to change in fuel cost, power procurement cost and transmission charges with reference to the cost of supply approved by the Commission shall not be passed on to the consumers provided that the concerned Distribution Licensee has an approved and subsisting regulatory Asset/ Gap outstanding for recovery during the same Financial Year.”
Under the provision, monthly reductions in the cost of power supply resulting from lower fuel costs, power procurement costs or transmission charges will not be reflected in consumer tariffs if the distribution licensee has an approved regulatory asset or revenue gap pending recovery during that financial year.
Implications
The amendment enables distribution licensees to use such savings to offset approved regulatory assets or revenue gaps instead of reducing consumer tariffs.
The provision applies only where the regulatory asset or gap has been approved by the Commission and remains outstanding during the same financial year. It does not apply universally to all distribution licensees or all instances of lower power procurement costs.
The Commission’s approach is intended to improve the financial position of utilities by allowing them to recover recognised shortfalls through operational savings without waiting for a subsequent tariff revision.
Legal basis
The amendment has been issued under Section 181(1), read with clauses (zd), (ze) and (zf) of Section 181(2), and Sections 61, 62 and 86 of the Electricity Act, 2003. It extends to the entire State of Jharkhand.
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