State electricity tariffs
State electricity tariffs for inter-State transmission are seeing a period of calm following CERC’s latest order on Power Grid Corporation of India Ltd.’s Northern Region assets. Instead of aggressive cost recovery, the regulator has prioritised predictability across the 2024–29 control period.
Annual Fixed Charges have been approved on a flat trajectory, rising modestly from Rs.714 crore in FY25 to Rs.748 crore by FY29. The structure reflects fully serviced debt, zero interest on loans, and return on equity confined strictly to normative limits. Operating expenses rise only through prescribed escalation factors.
The most consequential element is the absence of additional capital expenditure claims. By accepting nil ACE for the entire block, the commission has removed a common source of tariff volatility. Capital cost remains locked at Rs.8,654 crore, shielding beneficiaries from retrospective adjustments linked to late claims or scope changes.
CERC’s approach underlines regulatory discipline. Each tariff component has been assessed within the framework of existing regulations, with limited gap between amounts sought and amounts allowed. Past true-ups show similar restraint, reinforcing confidence in process-led regulation.
For discoms and long-term users, State electricity tariffs tied to transmission are now easier to model. Predictable charges support ARR planning, reduce liquidity shocks, and limit reopening risk. Within Indian Power news, this order stands out for what it avoids rather than what it grants.The broader takeaway is that State electricity tariffs can be stabilised through consistency and restraint. EnergylineIndia.com provides a detailed breakdown of how this order positions State electricity tariffs as a stable reference point during ongoing Power sector reforms, CERC, Transmission Network, Tariff Stability, Power Sector.
