#fppas

Madhya Pradesh’s distribution companies will apply a –2.23% Fuel and Power Purchase Adjustment Surcharge (FPPAS) for November 2025, following MPPMCL’s latest computation based on MPERC’s n-2 methodology.

The lower adjustment reflects softer procurement costs recorded in the reference month of September 2025, which forms the basis for the state’s monthly surcharge mechanism.

What Drove the Negative Adjustment?

According to the computation sheet:

Total power procurement: 8,991 MU

Bulk sales considered: 473 MU

Net energy base for surcharge: ~8,517 MU

Projected avg cost (FY): ₹3.66/kWh

Actual avg cost (Sept 2025): ₹3.53/kWh

The –₹0.13/kWh incremental power purchase cost, once adjusted for normative losses and the approved average billing rate of ₹7.14/kWh, results in the –2.23% FPPAS now being passed through to consumers.

Regulatory Loss Parameters Used

Inter-state transmission losses: 3.62%

Intra-state losses: 2.61%

Distribution loss factor: 15.47%

All three DISCOMs — MPPoorv, MPPaschim and MPUttar — have been instructed to apply the new surcharge immediately and publish the underlying computation sheet on their websites.

What This Means for Consumers and DISCOMs

A negative surcharge directly reduces November electricity bills, offering short-term relief to consumers.

For DISCOMs, however, it results in a tighter monthly revenue position. Still, MPERC’s Multi-Year Tariff (MYT) framework ensures that such month-to-month variations remain revenue-neutral across the control period, preserving financial balance despite temporary deviations.

Why This Matters

This month’s negative FPPAS highlights how changes in short-term procurement cost structure — especially market purchases and seasonal generation — can influence retail tariffs in real time. It also underscores the regulatory role of the n-2 methodology in smoothing volatility and ensuring transparency in the pass-through of power purchase costs.