Prior to the Central Electricity Regulatory Commission (CERC) capping power exchange prices at ₹12 per unit, they had reached almost ₹20 per unit, which was higher than the inflated prices of imported coal charged at the central coal generating stations, increased gas prices, and higher power prices.
The cost of buying power for Delhi DISCOMS has reportedly climbed by almost 300 percent since 2002, a cost over which DISCOMS have little control, while the retail pricing has increased by about 90 percent during the same time period, according to officials.
As per DISCOM, timely review of the PPAC is a requirement under the Electricity Act, DERC's own tariff orders and Appellate Tribunal for Electricity (APTEL) orders.
The National Thermal Power Corporation (NTPC), National Hydro-Electric Power Corporation (NHPC), and transmission companies are permitted by the Central Electricity Regulatory Commission to examine the PPAC on a monthly basis. Delhi DISCOMS, on the other hand, evaluate the PPAC every three months.
In order to make up for changes in the market-driven fuel costs brought on by rises in the price of coal and gas, DISCOMS impose an additional fee on producing businesses known as the Power Purchase Adjustment Charge (PPAC).
Every state regulatory body (DERC in the case of Delhi) must implement a mechanism for the automatic pass-through of fuel and power procurement costs in tariff to ensure the viability of the power sector, according to directives from the Ministry of Power on November 9, 2021.
PPAC is required by the DERC's Electricity Act. On a monthly basis, the central regulatory commission (CERC) grants permission to central PSU gencos like NTPC, NHPC, and trancos (PPAC). Delhi discoms, on the other hand, are permitted PPAC once every three months, the official noted.
(With agency inputs)
