Latest news with #RegulatoryAsset
Time of India
3 days ago
- Business
- Time of India
SC orders recovery of 50k cr deferred power tariffs in Raj
Jaipur: Discoms in Rajasthan have been deferring power tariff hikes as they became a political tool under successive govts. But these are not subsidies and need to be collected from the consumers. Currently, the discoms sit over Rs 50,000 crore of such deferred tariffs. Earlier this month, the Supreme Court directed all the electricity regulators and discoms in the country to find ways to realise these revenues over a period of seven years starting from 2024 and it can be done by hiking power tariffs. If the state govt does not intervene and pay the amount, the discoms will have to hike tariffs to recover the amount. According to estimates, the discoms in the state need to raise electricity tariffs by at least 90 paise per unit from all consumers to recover the amount in seven years. Additionally, the discoms pay around Rs 5,000 crore interest on the Rs 50,000 crore liability. If the future interest amount is added, the additional tariffs can cross Re 1 a unit. The problem of the deferred revenues, called regulatory assets, is particularly severe in Rajasthan as its discoms account for over 25% of country's total regulatory assets. In fact, the Rajasthan Electricity Regulatory Commission, incorporated provisions on regulatory assets in its 2025 tariff regulations that are in line with the Supreme Court's decision. Manish Kumar Mahto of Centre for Energy, Environment and People, said, "Despite these stringent measures, the discoms did not outline any liquidation plans in their annual tariff petitions, as required under the regulations. This omission underscores gaps in the regulatory framework and RERC's limited ability to enforce compliance." Mahto said the apex court also capped annual revenue shortfall of discoms at 3% of the approved revenue requirement and limited regulatory asset creation to exceptional circumstances only. Mahto said that on top of concerns about high surcharges themselves, there are questions about how they will fit within tariff structures. "In their tariff petitions for FY26, the discoms have proposed that the combined Regulatory Asset Surcharge and Fuel and Power Purchase Adjustment Surcharge (FPPAS) be capped at Re 1 per unit. With base fuel surcharges for this year being charged at 28 paise per unit and actual fuel surcharges reaching as high as 56 paise per unit in last two years, there is little scope to recover even the initial 90 paise per unit regulatory asset surcharge required for regulatory asset liquidation," he added. Stay updated with the latest local news from your city on Times of India (TOI). Check upcoming bank holidays , public holidays , and current gold rates and silver prices in your area.
Economic Times
08-08-2025
- Business
- Economic Times
Reliance Infrastructure shares jump 8% from day's low. Here's why
The apex court has set out ten sutras to examine the issue relating to Regulatory Asset, its position in the regulatory regime for determination of tariff, the duties and accountability of the regulators. Reliance Infrastructure shares jumped nearly 8% after the Supreme Court allowed its subsidiaries BSES Yamuna and BSES Rajdhani Power to recover Rs 21,413 crore in regulatory assets over four years, issuing guidelines to electricity regulators for cost-reflective tariffs and timely liquidation of such assets. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Shares of Reliance Infrastructure surged nearly 8% from the day's low of Rs 269 to a high of Rs 290.70 on the BSE after its subsidiaries, BSES Yamuna Power and BSES Rajdhani Power , announced plans to recover about Rs 21,413 crore in regulatory assets over four to an exchange filing by the company, the Supreme Court has pronounced the judgment in connection with a Writ Petition and Civil Appeals filed by BSES Discoms, BSES Yamuna Power Limited and BSES Rajdhani Power Limited, material subsidiaries of Reliance Infra, in 2014. The discoms had approached SC, raising the issue of non-cost reflective tariff, unlawful creation of Regulatory Asset and non-liquidation of Regulatory Read | Over 50 mutual fund SIPs give negative returns in 1 year. Should you pause, redeem, or continue? The apex court has set out ten sutras to examine the issue relating to Regulatory Asset, its position in the regulatory regime for determination of tariff, the duties and accountability of the regulators - the Electricity Regulatory Commission (ERC) and the powers of the Appellate Tribunal for Electricity to avert regulatory SC has issued nine directions to ERCs and APTEL in respect of cost-reflective tariff determination, creation and amortisation of Regulatory Asset, and regulatory oversight by APTEL to monitor implementation of directions by ERCs, i.e as a first principle, tariff shall be cost-reflectiveThe revenue gap between the approved Aggregate Revenue Requirement and the estimated annual revenue from the approved tariff may occur in exceptional court further said that the regulatory asset should not exceed a reasonable percentage, which percentage can be arrived based on Rule 23 of the Electricity Rules, 2005 that prescribes 3% of the ARR as the guiding principle and if a Regulatory Asset is created, it must be liquidated within three years, taking Rule 23 as the guiding next direction is that the existing Regulatory Asset must be liquidated in a maximum of four years starting from 01.04.2024, taking Rule 23 as the guiding principle. The ERCs must provide the trajectory and roadmap for liquidation of the existing regulatory asset, which will include a provision for dealing with carrying costs, and the ERCs must also undertake a strict and intensive audit of the circumstances in which the discoms have continued without recovery of the Regulatory Asset, the court shall, in general, follow the principles governing creation, continuation and liquidation of the regulatory asset, as laid down in paragraph 70 of the Judgment, and also abide by the directions of the APTEL summarised in paragraph 69.8 of the Judgment, the filing mentioned that APTEL shall invoke its powers under Section 121 and issue such orders, instructions or directions as it may deem fit to the ERCs for performance of their duties concerning Regulatory Asset as enunciated in this judgment and lastly, APTEL shall register a suo moto petition under Section 121 of the Electricity Act to monitor implementation of above directions till the conclusion of the period mentioned therein.
Time of India
08-08-2025
- Business
- Time of India
Reliance Infrastructure shares jump 8% from day's low. Here's why
Shares of Reliance Infrastructure surged nearly 8% from the day's low of Rs 269 to a high of Rs 290.70 on the BSE after its subsidiaries, BSES Yamuna Power and BSES Rajdhani Power , announced plans to recover about Rs 21,413 crore in regulatory assets over four years. According to an exchange filing by the company, the Supreme Court has pronounced the judgment in connection with a Writ Petition and Civil Appeals filed by BSES Discoms, BSES Yamuna Power Limited and BSES Rajdhani Power Limited, material subsidiaries of Reliance Infra, in 2014. The discoms had approached SC, raising the issue of non-cost reflective tariff, unlawful creation of Regulatory Asset and non-liquidation of Regulatory Asset. Productivity Tool Zero to Hero in Microsoft Excel: Complete Excel guide By Metla Sudha Sekhar View Program Finance Introduction to Technical Analysis & Candlestick Theory By Dinesh Nagpal View Program Finance Financial Literacy i e Lets Crack the Billionaire Code By CA Rahul Gupta View Program Digital Marketing Digital Marketing Masterclass by Neil Patel By Neil Patel View Program Finance Technical Analysis Demystified- A Complete Guide to Trading By Kunal Patel View Program Productivity Tool Excel Essentials to Expert: Your Complete Guide By Study at home View Program Artificial Intelligence AI For Business Professionals Batch 2 By Ansh Mehra View Program Also Read | Over 50 mutual fund SIPs give negative returns in 1 year. Should you pause, redeem, or continue? The apex court has set out ten sutras to examine the issue relating to Regulatory Asset, its position in the regulatory regime for determination of tariff, the duties and accountability of the regulators - the Electricity Regulatory Commission (ERC) and the powers of the Appellate Tribunal for Electricity to avert regulatory failure. The SC has issued nine directions to ERCs and APTEL in respect of cost-reflective tariff determination, creation and amortisation of Regulatory Asset, and regulatory oversight by APTEL to monitor implementation of directions by ERCs, i.e as a first principle, tariff shall be cost-reflective The revenue gap between the approved Aggregate Revenue Requirement and the estimated annual revenue from the approved tariff may occur in exceptional circumstances. Live Events The court further said that the regulatory asset should not exceed a reasonable percentage, which percentage can be arrived based on Rule 23 of the Electricity Rules, 2005 that prescribes 3% of the ARR as the guiding principle and if a Regulatory Asset is created, it must be liquidated within three years, taking Rule 23 as the guiding principle. The next direction is that the existing Regulatory Asset must be liquidated in a maximum of four years starting from 01.04.2024, taking Rule 23 as the guiding principle. The ERCs must provide the trajectory and roadmap for liquidation of the existing regulatory asset, which will include a provision for dealing with carrying costs, and the ERCs must also undertake a strict and intensive audit of the circumstances in which the discoms have continued without recovery of the Regulatory Asset, the court said. Also Read | Multi asset mutual funds beat other hybrid funds in 1 & 3 years. Should they be in your portfolio? ERCs shall, in general, follow the principles governing creation, continuation and liquidation of the regulatory asset, as laid down in paragraph 70 of the Judgment, and also abide by the directions of the APTEL summarised in paragraph 69.8 of the Judgment, the filing said. It mentioned that APTEL shall invoke its powers under Section 121 and issue such orders, instructions or directions as it may deem fit to the ERCs for performance of their duties concerning Regulatory Asset as enunciated in this judgment and lastly, APTEL shall register a suo moto petition under Section 121 of the Electricity Act to monitor implementation of above directions till the conclusion of the period mentioned therein. ( Disclaimer : Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times) ETMarkets WhatsApp channel )
