The Tripura Electricity Regulatory Commission (TERC) has approved the tariffs for Tripura State Electricity Corporation (TSECL) for the financial year ending March 2027. The order covers the truing-up for the year ended March 2025, the annual performance review for the year ended March 2026, and the aggregate revenue requirement and retail tariff for the year ended March 2027.

The revised tariff is effective from May 1, 2026.

Revenue Gap and Tariff Determination

TSECL had sought to recover a cumulative revenue gap of ₹17.09 billion (~$178.70 million) through tariff revisions and a regulatory surcharge. The Commission did not approve the recovery of the full gap in the current tariff and allowed only a portion of the past true-up gaps.

The Commission considered one-fifth of the true-up revenue gap for the year ended March 2024, one-third of the true-up gap for the year ended March 2025, and the full carrying cost of ₹1.50 billion (~$15.64 million) while finalizing the ARR for the year ending March 2027.

The standalone ARR for the year ended March 2027 was determined to be ₹21.64 billion (~$226.32 million). The Commission approved ARR without government subsidy at ₹13.52 billion (~$141.32 million) for computing the average cost of supply.

After accounting for the government subsidy of ₹770 million (~$8.05 million), the tariff determination amount comes to about ₹12.75 billion (~$133.27 million).

Tariff Structure and Consumer Impact

The Commission rejected TSECL’s proposal for a regulatory surcharge and decided to recover the approved revenue gap through rationalized fixed charges and a marginal increase in energy charges.

The average cost of supply was approved at ₹8.90 (~$0.093)/kWh against TSECL’s claimed ₹18.13 (~$0.19)/kWh. The Commission said full recovery of the standalone ARR would require a tariff increase of about 43%, which it considered too high.

The Commission observed that revenue from fixed charges accounts for only 5% of TSECL’s total revenue. It rationalized fixed charges across consumer categories and approved marginal energy charge increases of ₹0.15 (~$0.0016)/kWh to ₹0.20 (~$0.0021)/kWh for domestic consumers, ₹0.20 (~$0.0021)/kWh for irrigation, public water works, public lighting, and special utility categories, and ₹0.35 (~$0.0037)/kWh for the remaining consumer categories.

If the Government of Tripura decides to provide the approved subsidy, it must be paid to TSECL in advance every month. The Commission directed TSECL to recover the full tariff if the subsidy is not paid in advance for two consecutive months.

Distribution and Power Purchase Costs

The Commission approved sales of 1,519.41 million units for the year ending March 2027. Revenue from interstate sales was projected at ₹10.12 billion (~$105.84 million), while government subsidy was considered at ₹770 million (~$8.05 million).

The Commission approved the distribution business ARR at ₹21.53 billion (~$225.10 million) after accounting for power purchase costs, transmission charges, TSECL’s own generation costs, operating expenses, depreciation, finance costs, return on equity, working capital interest, and non-tariff income.

Power purchase cost for the year ending March 2027 was approved at ₹16.18 billion (~$169.17 million). TSECL’s own generation cost was approved at ₹1.78 billion (~$18.60 million). Interstate transmission charges were approved at ₹1.14 billion (~$11.96 million), while intrastate transmission charges were approved at ₹392.4 million (~$4.10 million).

The Commission approved a transmission and distribution loss of 18.30% for the year ending March 2027. For the year ended March 2025, the actual loss was 27.56%, while the normative loss of 19% was used in the gain and loss computation.

Transmission, Wheeling and Cross-Subsidy

For open access consumers at the 33 kV voltage level, the wheeling charge was approved at ₹0.47 (~$0.0049)/kWh. The Commission based this on a distribution wire cost of ₹2.42 billion (~$25.27 million), energy input of 1,813.14 million units, and 35% cost allocation to the 33 kV voltage level.

The Commission approved a total system loss of 18.30% for computing the cross-subsidy surcharge, comprising 2.50% intrastate transmission loss and 16.20% wheeling loss. It also approved a weighted average power purchase cost of ₹4.78 (~$0.05)/kWh for surcharge computation.

Operational and Compliance Directions

TSECL filed a combined petition because the financial segregation of Tripura Power Generation and Tripura Power Transmission has not been completed. The Commission said TSECL submitted segregated ARR calculations based on division-wise account statements and related assumptions.

The Commission directed TSECL to complete financial segregation, feeder energy audits within six months, boundary metering, voltage-wise loss measurement, and uniform billing across all subdivisions. It also directed TSECL to submit quarterly reports on prepaid meters and maintain source-wise power purchase statements reconciled with audited accounts.

Earlier this year, TERC issued the third amendment to the Tripura Electricity Regulatory Commission (Electricity Supply Code) Regulations, 2011.

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