Punjab: The majority of household consumers won’t be impacted by the increase because the Punjab government already gives each customer 300 units of free electricity, and the agricultural sector also receives free electricity.
The Punjab State Electricity Regulatory Commission (PSERC) made the decision on Friday to raise the electricity rate from June 16, 2024, to March 31, 2025, by 11 paise per unit for residential customers and 15 paise per unit for the industrial sector.
The majority of household consumers won’t be impacted by the increase because the Punjab government already gives each customer 300 units of free electricity, and the agricultural sector also receives free electricity. However, the government will be burdened by the move as it now provides ₹20,000 crore in annual subsidies for both home consumers and agricultural.
Prior to this, the Punjab State Power Corporation Limited (PSPCL) petitioned the PSERC for an aggregate revenue requirement (ARR) of ₹53,360.48 crore, citing a ₹5,419.82 crore revenue shortfall through the 2024–25 fiscal year. There was a ₹6,977.98 crore deficit in the fiscal year 2022–2023 and a ₹1,558.16 crore surplus in the fiscal year 2024–2025.
After a careful investigation, the PSERC found a revenue shortfall of Rs. 654.35 crore, accounting for ₹4,072.27 crore in past-due amounts. Consequently, the commission arrived at a ₹654.35 crore higher revenue demand as opposed to the ₹5419.82 crore that the PSPCL had requested.
With an increase of approximately 11 paise/unit over the average cost of supply for FY 2023–24, the average cost of supply for FY 2024–25 comes out to be 715.55 paise/kWh, 1.59% higher than the ACoS of 704.34 paise/kWh as decided in the tariff order for FY 2023–24.
As a result, the earlier shortfall that the commission had calculated and approved will be eliminated, with the ARR for FY 2024–25 being ₹44,239.14 crore and the anticipated net revenue to PSPCL from the stated tariff during FY 2024–25 being ₹48,467.72 crore.