Power consumers in city have a reason to cheer

Ramkrishan Upadhyay
Tribune News Service
Chandigarh, August 25

The next power bills will bring relief to consumers as the Electricity Department has decided to pass on the benefit of less fuel and power purchase cost adjustment (FPPCA) charges to them.

The new FPPCA charges will reduce the power bills by 20 per cent to 30 per cent from next month.

The Joint Regulatory Electricity Commission has authorised the UT Electricity Department to compute fuel and power procurement cost variation on a quarterly basis and charge it from the consumers. The electricity charges were increased by 30 per cent in May 2019. however, this time, the charges have been reduced due to a reduction in the rates of electricity bought by the department in the last quarter.

The department has computed the FPPCA charges for the first quarter of the new financial year 2019-20 (April to June). The benefit of the reduced charges will be reflected in the bills of the consumers to be issued for August 1 -October 31 period.

As per the FPPCA system, when the department buys electricity at higher rates, it charges the extra amount from the consumers. In case electricity is bought at lower rates, the benefit has to be passed on to the consumers. In the last quarter (January to March 2019), the department had enhanced the charges, which were reflected in the bills of the consumers from May to July.

Now, the benefit will be given to all types of consumers — domestic, commercial and industrial. The reduction will be from 29 paise to a maximum of Rs 1.26 per unit.

What is FPPCA

Fuel and power purchase cost adjustment (FPPCA) charges are what the Electricity Department applies to consumers on bills based on varying prices of fuel or coal. The prices of coal or fuel change every month based on demand and supply. Electricity generating companies pass on this cost to the distribution companies, who further pass it on to the consumers.