Amid concerns over a recent revision in the Power Purchase Adjustment Cost (PPAC), Delhi Power Minister Ashish Sood on Saturday said the Delhi Government has taken steps to ensure that consumers, particularly those receiving electricity subsidies, remain protected from the impact of rising global fuel prices.
PPAC Hike Limited Despite Rising Costs
Sood clarified that the PPAC is a statutory provision under the existing electricity laws that allows power distribution companies to adjust electricity tariffs in line with fluctuations in fuel and power procurement costs. He stressed that the mechanism is not a new arrangement and is implemented across the country.
“Power Purchase Adjustment Cost (PPAC) is not a new arrangement. The electricity laws of the country already permit power companies to adjust for the rising cost of fuel used to generate electricity. Due to the situation in West Asia and other prevailing circumstances, fuel costs have risen sharply, leading to a 31 per cent increase in power procurement costs during the past month,” Sood said.
Government Intervention Protects Consumers
The minister said the recent increase in power procurement costs was driven by a sharp rise in global fuel prices amid the ongoing crisis in West Asia and other international developments. However, he maintained that the Delhi Government intervened to ensure that consumers were not burdened with the full impact of the cost escalation.
“Even though power procurement costs rose by 31 per cent, the Delhi Electricity Regulatory Commission (DERC) has allowed only an average increase of 2.4 per cent in the PPAC. Earlier, the PPAC had been capped at 14.5 per cent till March 31. With the latest revision, it stands at approximately 17.5-17.9 per cent. This demonstrates our commitment to protecting consumers from the full impact of rising global energy prices,” he stated.
Balancing Financial Sustainability and Consumer Interests
According to the minister, the latest order issued by the DERC seeks to balance the financial sustainability of power distribution companies with consumer interests. He noted that the order also includes deferred recovery mechanisms to limit the immediate burden on consumers.
Sood reiterated that households benefiting from the Delhi Government’s electricity subsidy scheme would not see any increase in their bills due to the PPAC revision.
“I want to categorically state that all consumers receiving Delhi Government electricity subsidies will face absolutely no impact on their electricity bills due to this regulatory adjustment. There is no reason for subsidised consumers to worry,” he said.
Misinformation Dismissed
The minister also dismissed what he termed as misinformation surrounding the PPAC revision and accused political opponents of attempting to create confusion among consumers.
“Attempts are being made to spread confusion and create unnecessary apprehensions. Our government stands firmly with consumers, particularly those benefiting from power subsidies. We are closely monitoring the situation and will continue to ensure that the burden of rising energy costs does not fall disproportionately on the people of Delhi,” he added.
Sood further said consumers served by Tata Power Delhi Distribution Limited (TPDDL) would experience virtually no impact from the latest adjustment, while subsidised consumers across the capital would remain fully insulated.
Commitment to Affordable Power
Reaffirming the government’s commitment to affordable and reliable power supply, the minister said Delhi’s electricity sector continues to operate under strict regulatory oversight aimed at ensuring uninterrupted service and consumer welfare despite global energy market volatility.
