The Uttarakhand Electricity Regulatory Commission (UERC) has set an additional surcharge of ₹1.09 (~$0.0123)/kWh for open access consumers for the period from October 1, 2025, to March 31, 2026.

The additional surcharge has been reduced by ₹0.03 (~$0.00033)/kWh when compared to ₹1.12 (~$0.013)/kWh from October 1, 2024, to March 31, 2025. The Commission had imposed an additional surcharge of ₹1.14 (~$0.013)/kWh from April 1, 2025, to September 30, 2025.

The decision follows a petition filed by Uttarakhand Power Corporation (UPCL) seeking approval to recover stranded fixed costs arising from its long-term power purchase commitments.

Background

UPCL had filed a petition on June 28, 2025, seeking an additional surcharge for the six-month period to recover fixed costs that became stranded due to consumers opting for open access power purchase instead of drawing from the distribution network.

The utility argued that while it maintains long-term power purchase agreements to ensure supply for all consumers, some large consumers procured power from the open market, leaving part of UPCL’s contracted capacity unused.

UPCL analyzed data from October 2024 to March 2025 and reported a total stranded energy of 125.99 million units (MU), corresponding to the same quantum of open access energy during that period.

The petitioner considered six interstate generating stations for fixed cost computation — Jhajjar Aravali, Dadri Gas, FG Unchahar-3, FG Unchahar-4, Anta, and Auriya.

The total fixed cost for these stations was ₹667.8 million (~$7.53 million), with an average fixed cost of ₹1.06 (~$0.012)/kWh at the state periphery and ₹1.24 (~$0.014)/kWh at the consumer end after accounting for 1.4% transmission and 13% distribution losses.

Kashi Vishwanath Textile Mill, the Kumaon Garhwal Chamber of Commerce & Industry, and Galwalia Ispat Udyog, questioned the validity of levying additional surcharge on consumers connected at 132 kV and above, and disputing whether the stranded power was genuinely attributable to open access drawal.

UPCL defended its computation, citing Section 42(4) and Regulation 23, and argued that all open access consumers, regardless of voltage level, are liable to pay the surcharge.

Commission’s Analysis

After reviewing the petition, submissions, and objections, UERC observed that most issues raised were already settled in previous orders. The Commission conducted an independent slot-wise analysis from October 2024 to March 2025, comparing daily open access drawal with surrendered power from the six generating stations.

Using the “lower-of” method, the total stranded energy was determined to be 129.80 MU at the state periphery and 111.68 MU at the consumer end. The six stations had a combined entitlement of 713.54 MU and a total fixed cost of ₹667.8 million (~$7.53 million).

Applying 1.10% transmission and 13% distribution losses, the Commission derived a weighted average fixed cost of ₹1.09 (~$0.0123)/kWh at the consumer end. The total stranded cost was computed at ₹121.5 million (~$1.37 million), and when divided by open access energy of about 112 MU, it resulted in the final surcharge of ₹1.09 (~$0.0123)/kWh.

The Commission concluded that the surcharge is in line with the Electricity Act, Tariff Policy, and UERC Open Access Regulations. It confirmed that the levy will apply uniformly to all open access consumers, irrespective of voltage level, for the period from October 1, 2025, to March 31, 2026.

In July this year, the Uttarakhand Electricity Regulatory Commission dismissed review petitions filed by 12 solar power developers against the cancellation of letters of award (LoAs) for projects issued under the state’s 200 MW Solar Program.

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