EXPLAINED | How is electricity tariff calculated in Karnataka?  Premium

Tariff for the financial year April 2023 – March 2024 was hiked in May 2023, which meant that the escoms had to collect the tariff for the month of April retrospectively. Thus, a 70 paise per unit arrear would be passed on to consumers in June.  Along with this, the FPPCA of ₹1.49 per unit for January 2023, which was supposed to be collected in March, but could not be collected due to technical reasons, was also levied in June.

The story so far: Just a few days after the Siddaramaiah-led Congress government promised free power up to 200 units for eligible domestic households in Karnataka under the Gruha Jyothi scheme, came a shocker to citizens as the tariff for the month of June was hiked by an average of ₹2-2.5 per unit across electricity supply companies (escoms). Bangalore Electricity Supply Company (Bescom), which accounts for around 50% of electricity supply in Karnataka, announced a tariff hike of ₹2.89 per unit for June. Along with this, it should also be noted that Bescom’s electricity tariff for the year 2023–24 has been hiked by 70 paise per unit.  

With many technicalities involved in the drafting of an electricity bill, many common consumers were left wondering why their bills for the month of June were exponentially higher when compared to their regular ones, and worried about the subsequent bill, which will come in July. 

Most consumers usually check the grand total at the end of their electricity bill. However, there are five components that add up to the grand total.  

Fixed charge (FC)

This is collected by escoms from each consumer to provide the basic infrastructure necessary to transmit power to each household. It includes the power purchase and infrastructure maintenance charges. Irrespective of a consumer’s consumption, FC has to be paid every month, as the escoms have to continue maintaining the infrastructure, like wires, which transmit power, as well as for buying the consumer’s share of power. A certain cost is fixed depending on the consumer’s sanctioned load. 

Energy charge (EC)

This is levied on consumers as per their consumption patterns. The Karnataka Electricity Regulatory Commission (KERC) generally fixes a certain energy charge per unit every year. The The amount is arrived at by multiplying the energy charge per unit with the number of units consumed, and thus this component varies every month.