On March 30, 2026, the Uttarakhand Electricity Regulatory Commission (UERC) issued its final Order regarding the Aggregate Revenue Requirement (ARR) and tariff determination for the Uttarakhand Power Corporation Limited (UPCL). The Commission’s determination reflects a priority on consumer price stability over utility revenue maximization, as it largely rejected the Petitioner’s proposed overall tariff hike of 16.23%. While the Order retains current electricity rates for the Domestic and Non-Domestic/Commercial categories, it implements strategic rationalization measures for Industrial consumers, most notably a significant reduction in the Continuous Supply Surcharge and a revised framework for high load factor consumption.
Key Financial Highlights and Revenue Requirement (ARR)
The financial architecture of the Order, summarized in Table 2.4, is predicated on the following regulatory determinations regarding UPCL’s revenue needs:
- Total Claimed Revenue Gap: UPCL identified a total revenue gap of Rs. 2,036.99 Crore for FY 2026-27.
- Technical Composition of the Gap: The claimed deficit is driven by three primary regulatory components:
- True-up of FY 2024-25: Rs. 1,349.19 Crore, representing the reconciliation of actual versus approved costs.
- Carrying Costs: Rs. 362.26 Crore for the recovery of interest on past regulatory assets.
- Projected Gap for FY 2026-27: Rs. 325.54 Crore projected for the ensuing fiscal year.
- Average Cost of Supply (ACOS): For the purpose of tariff design, the Petitioner’s estimated Average Cost of Supply is established at Rs. 8.70 per unit.
Tariff Decisions: Retention vs. Revision
The Commission’s decision-making framework balances utility financial viability with the socio-economic constraints of the State’s consumers. The treatment of major consumer categories for FY 2026-27 is outlined below:
| Consumer Category | Commission Decision (FY 2026-27) |
| Domestic (RTS-1) | Rates retained at existing levels to ensure price stability. |
| Non-Domestic/Commercial (RTS-2) | Rates retained at existing levels. |
| Private Tube Wells (RTS-4) | The Commission rejected the proposed 5% hike, maintaining the existing Energy Charge Rate (ECR) at Rs. 2.55/unit (Table 5.10) instead of the proposed Rs. 2.84/unit. |
| Industrial (HT/LT) (RTS-5) | Tariff framework rationalized through Load Factor revisions and surcharge reductions. |
Industrial Sector Analysis: Rates and Load Factors
For the Industrial category (RTS-5), the Commission has introduced technical adjustments aimed at optimizing system utilization and rewarding efficient consumption patterns:
- Load Factor Framework: In accordance with Section 2.24.2 of the Order, the Commission revisited the Load Factor-based framework to provide lower rates for consumers maintaining high load factors. This move is specifically designed to utilize base load power and encourage higher consumption levels among High Tension (HT) industries.
- Continuous Supply Surcharge (CSS): Observing a marked improvement in power availability within the State, the Commission determined that the high “shortage-era” surcharge was no longer justifiable (Source 2.14.3). Consequently, the CSS has been reduced from 15% to 7.5% for FY 2026-27.
- Fixed and Demand Charges: Industrial demand charges are maintained in the range of Rs. 410 to Rs. 480 per kVA, as substantiated by stakeholder testimony and the Petitioner’s existing rate schedules.
- Voltage Rebates: To reflect lower technical losses at higher voltages, the Commission approved the following rebates on energy charges:
- 33 kV Supply: 3.5% rebate.
- 132 kV and Above: 7.5% rebate.
Technical Breakdown: Grid Charges and Open Access
The regulatory framework for grid utilization and open access for the upcoming fiscal year includes several critical determinations and claims:
- Transmission Charges: Per Table 4.36, the Commission has approved intra-state transmission charges totaling Rs. 185 Crore payable to PTCUL.
- Wheeling Charges: The Commission approved specific wheeling charges for FY 2026-27, which notably include the introduction of charges for the Mixed Load category (RTS-6) specifically for embedded open access consumers (Source 5.4).
- Additional Surcharge: It is noted that UPCL has filed a claim for an additional surcharge of Rs. 1.05 per unit for the period starting April 1, 2026; however, this remains a Petitioner claim subject to separate regulatory scrutiny.
- Green Power Tariff: The Commission confirmed the approval of the Green Power Tariff for FY 2026-27, as detailed in Table 5.3.
Operational Efficiency Targets
To drive the operational sustainability of the distribution licensee, the Commission has mandated strict performance targets and technological benchmarks:
- Distribution Loss and Financial Impact: The actual distribution loss for FY 2024-25 was recorded at 13.69%, which resulted in a revenue loss of Rs. 51.66 Crore. In accordance with Table 2.3, the Commission only allowed 2/3rd of this loss for sharing, penalizing the utility for efficiency failures. For FY 2026-27, the Commission has set an improved target of 12.25%.
- Mandatory Prepaid Metering: Under the Revamped Distribution Sector Scheme (RDSS), the Commission has mandated the rollout of prepaid metering for all consumers with loads up to 25 kW.
- Data Transparency Mandate: UPCL is directed to provide comprehensive voltage-wise cost of supply data in all future filings to move toward more cost-reflective tariff designs.
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