Delhi power price hike: Rekha Gupta government will likely increase electricity rates in Delhi from April. This will be a big shock to the residents as the national capital has not witnessed a power tariff hike since 2014-15. During this time, the cost of providing electricity went up, but the prices people paid stayed the same. This led to a large amount of unpaid costs, known as a “regulatory asset” load. These are basically costs that were put off until later, which customers will now have to pay back through their bills, along with interest.
Why Delhi electricity rates may increase?
As per the officials, the government is getting ready to pay back over Rs 38,000 crore in unpaid fees to the three power companies.However, the government plans to offer subsidies to help soften the blow for residents.
To recall, last August the Supreme Court ordered that roughly Rs 27,200 crore in costs and interest must be paid to the city’s private power suppliers, BRPL, BYPL, and TPDDL, over the next seven years. These “regulatory assets” are essentially costs that weren’t recovered earlier. They have grown significantly because electricity rates haven’t been raised in ten years while the Aam Aadmi Party has been in power.
In January, the city’s power regulator told a central agency that the total amount owed now stands at over Rs 38,552 crore.
According to official filings, this includes large sums for each supplier. These amounts represent the actual costs the companies took on to provide electricity to the city. The total has increased over time because interest has been building up while the recovery was delayed.
The court also told the regulator to create a plan to get this money back, account for the interest, and explain why it has taken so long to address these costs. This money will likely be collected through an extra charge on electricity bills over the next seven years.
Delhi’s Power Minister, Ashish Sood, hinted last March that rates might rise, noting that the power companies were now authorised to recover Rs 27,000 crore that had built up.
