New Delhi: With the recent increase in the Power Purchase Adjustment Charge (PPAC) by close to 4%, the electricity is likely to get costlier in the national capital.
The PPAC has been increased by 4% and the charge will be effective from 11th July as per the Delhi Electricity Regulatory Commission (DERC).
Power Purchase Adjustment Charge (PPAC) is an additional charge given to production companies by DISCOMS to compensate for variations in the market-driven fuel costs, on account of increases in coal and gas prices.
According to the officials from DISCOM, the PPAC is levied to balance out the increase in fuel prices.
The increase in PPAC has come ahead of the inflated prices of imported coal from the central coal generating stations, increase in the gas prices, and high prices of power exchanges, which had reached almost ₹20 per unit before being capped by the Central Electricity Regulatory Commission (CERC) to ₹12 per unit.
The officials further added that the cost of buying electricity since 2002 has increased by 300%. DISCOM has no control over these increases. On the other hand, the retail tariff has increased by 90% around the same timeframe.
The CERC allows the central public service power generation companies like the National Thermal Power Corporation (NTPC), National Hydro-Electric Power Corporation (NHPC), and transmission companies to review the PPAC on a monthly basis. On the other hand, DISCOMS review the PPAC on a quarterly basis.