Business 12 Jun, 2026

DERC allows Delhi discoms to recover higher power purchase cost for April

Business To Business, New Delhi, 12^th June, 2026:   The Delhi Electricity Regulatory Commission (DERC) has permitted electricity distribution companies (discoms) in Delhi to recover a higher Fuel and Power Purchase Adjustment Surcharge (FPPAS) from consumers, citing increased electricity procurement costs amid the ongoing global energy crisis linked to geopolitical tensions.
The increase will primarily impact consumers who are not covered under government electricity subsidy schemes.
Consumers receiving:

• Full electricity subsidy, or
• 50% subsidy

will not be affected by the higher surcharge, according to officials.
The Fuel and Power Purchase Adjustment Surcharge (FPPAS) is a variable charge added to electricity bills to compensate distribution companies for fluctuations in:

• Fuel costs used for power generation.
• Power purchase costs from generating stations and the electricity market.

The surcharge is calculated as a percentage of the total energy and fixed costs and is revised periodically depending on actual procurement expenses.
Officials said power purchase costs have risen because of:

• Higher fuel prices in global markets.
• Increased electricity procurement expenses.
• Supply-side pressures arising from international geopolitical developments and disruptions in energy markets.

As discoms incur higher costs to procure electricity, the regulator has allowed part of the burden to be passed on to consumers through the FPPAS mechanism.
For consumers not receiving subsidies, the decision could result in:

• Higher monthly electricity bills.
• Increased costs during periods of elevated power demand.
• Greater sensitivity of bills to fuel price fluctuations.

However, subsidized households will continue to receive relief through the existing subsidy framework.
The decision reflects the challenges faced by power utilities across India as they deal with rising energy costs. Regulators typically allow fuel and power purchase adjustments to ensure that distribution companies remain financially viable while maintaining uninterrupted electricity supply to consumers.
The exact impact on individual bills will depend on the applicable surcharge rate and the amount of electricity consumed.