To bridge revenue gap, firm seeks power tariff revision

Nearly five months after taking over the UT Electricity Department, Chandigarh Power Distribution Private Limited (CPDL) has sought revision in power tariff.

The CPDL submitted a petition to the Joint Electricity Regulatory Commission (JERC) for determination of aggregate revenue requirement and tariff for the financial years 2025-26 to 2029-30.

In the petition, the firm stated that the projected revenues from the sale of power at existing tariff are not sufficient to meet the costs estimated for efficient management of the electricity distribution functions leading to a cumulative revenue gap of Rs 982 crore (excluding carrying cost) over the entire control period of five years.

The petitioner submitted that the net revenue requirement for the 2025-26 fiscal was Rs 1,157 crore and the revenue collected from retail sales at the existing tariff would be Rs 1,075 crore, creating a revenue gap Rs 81 crore for the year.

Similarly, the net revenue requirement for the year 2026-27 would be Rs 1,265 crore and the revenue generated from retail sales at the current tariff would be Rs 1,265 crore, creating a deficit of Rs 140 crore. The net revenue requirement for 2027-28 would be Rs 1,375 crore, but revenue collected from retail sales would be Rs 1,177 crore and there would be a revenue gap of Rs 198 crore. The net revenue requirement for 2028-29 would be Rs 1,496 crore, which will be Rs 262 crore more than the revenue of Rs 1,234 crore from retail sales. The net revenue requirement for 2029-30 would be Rs 1,596 crore against revenue generation of Rs 1,295 crore, a gap of Rs 301 crore.

In five years, the cumulative revenue gap would be Rs 982 crore at the existing tariff, stated the firm. The petitioner requested the commission to approve the suitable tariff to ensure recovery of proposed/estimated costs for the control period.

Based on the estimated revenue gap at the existing tariffs, the petitioner submitted tariff proposal to recover the revenue gaps. However, after taking over the department, the CPDL has also changed the slab system into five categories. Now, each slab consists of 100 units instead of the earlier three slabs of 0-150 units, 150 to 400 units and above 400 units.

In the first slab, the CPDL has proposed a tariff of Rs 2.96 per unit for up to 100 units for the financial year 2025-26.