The Jharkhand State Electricity Regulatory Commission (JSERC) has partly allowed a review petition filed by Damodar Valley Corporation (DVC), granting significant relief on key tariff components by revising its September 30, 2024 tariff order in light of subsequent legal developments and regulatory determinations. The Commission modified its earlier findings on Non-Tariff Income (NTI), Differential Annual Fixed Cost (AFC), Interest on Working Capital (IoWC) and Plant Availability Factor (PAF), while rejecting DVC’s claim relating to rebate on sale of power.
The review petition challenged the Commission’s tariff order relating to the true-up for FY 2022-23, Annual Performance Review (APR) for FY 2023-24 and Aggregate Revenue Requirement (ARR) and Tariff for FY 2024-25, contending that certain findings were contrary to subsequent judicial and regulatory decisions.
One of the principal reliefs granted concerned Non-Tariff Income. Relying on the Appellate Tribunal for Electricity’s (APTEL) judgment dated April 24, 2026 in Appeal No. 227 of 2025, the Commission held that only income incidental to the distribution business and derived from distribution assets can be treated as Non-Tariff Income for tariff determination. Consequently, JSERC restricted NTI to Delayed Payment Surcharge (DPS) alone and revised the admissible NTI from Rs. 1,015.14 crore to Rs. 0.30 crore, excluding income attributable to DVC’s generation and transmission businesses.
The Commission also accepted DVC’s claim for differential Annual Fixed Cost (AFC) of Rs. 1,205.73 crore, arising from the Central Electricity Regulatory Commission’s (CERC) true-up orders for FY 2014-15 to FY 2019-20. JSERC held that costs approved by CERC for DVC’s generation and transmission assets constitute a legitimate component of power procurement cost for retail tariff determination and directed that the amount be considered in the ARR, subject to adjustment of any recovery already permitted in earlier tariff orders to avoid duplication.
Consequent upon the revised power procurement cost and other admissible ARR components, the Commission also recomputed Interest on Working Capital (IoWC) for FY 2022-23. The admissible IoWC was enhanced from Rs. 5.21 crore to Rs. 53.16 crore, though the Commission declined to allow DVC’s entire claim.
JSERC further granted relief on the issue of Plant Availability Factor (PAF) by accepting DVC’s actual PAF figures for Raghunathpur Thermal Power Station (RTPS) Units 1 and 2. As a result, the admissible Annual Fixed Charges (AFC) for the generating station were revised upward from Rs. 420.14 crore to Rs. 423.42 crore.
However, the Commission rejected DVC’s plea seeking separate allowance of rebate on sale of power, observing that prompt payment rebates are commercial incentives intended to encourage timely payments and do not constitute statutory expenditure warranting an independent pass-through in the ARR. It further held that the impact of such rebates had already been factored into the revenue projections and allowing the claim separately would amount to double counting.
The review petition was accordingly partly allowed, with JSERC modifying the tariff order on the above issues while declining relief on the remaining claims.
