The UT Administration is all set to introduce multi-year tariff concept in Chandigarh.
With this, the UT Electricity Department will shift from the annual tariff filling exercise to a multi-year tariff (MYT) filling system from next year.
On the directions of the Joint Electricity Regulatory Commission (JERC), the UT Electricity Department has initiated work for the implementation of multi-year tariff (MYT) system in the city.
Under MYT system, the tariff determination exercise will be undertaken once in five years. The UT Electricity Department will submit a five-year trajectory of expected revenue, expenditure and losses on the basis of which JERC will determine power tariff for next five years at one go. At present, the exercise for tariff revision is done annually.
The MYT introduction is mandated by Section 61 of the Electricity Act 2003, to give an element of certainty to all stakeholders. With this, tariffs will not fluctuate beyond a certain bandwidth unless there are unforeseeable conditions.
Also, the electricity consumer will have a fair idea of what to expect in the next five years and the distribution company (Discom) will also be able to plan its business having known the likely retail tariff for the control period.
The shift from an annual tariff determination exercise to a multi year system is likely to bring reduction in regulatory effort on the part of the Commission, utilities and other stakeholders, reduction in regulatory uncertainty, provision of a transparent and stable system of incentives and disincentives.
With the introduction of MYT, the power supply tariff in Chandigarh would be divided into three slots namely peak tariff, normal tariff and off tariff. The time period of the peak tariff would be 10 am to 6 km, normal tariff 7am to 10 am/6pm to 11pm and off peak tariff will be 11pm to 7am.
The UT Electricity Department would also soon initiate process of installation of meters to ascertain the demand time and energy usage in the city. Such meters known as Time of Day metering (TOD) involves dividing the day, month and year into tariff slots and with higher rates at peak load periods and low tariff rates at off-peak load periods.
As per UT’s estimations, peak tariff is likely to be 22 to 30 percent higher than normal tariff while the off tariff is likely to be 15 to 20 percent lower than normal in the city.
MP Singh, Superintending Engineer, UT Electricity wing said, “The Department has initiated process for the introduction of MYT in the city. TOD meters would be installed in the residents and the MYT concept would be introduced here next year. The tariff determination exercise will be undertaken once in five years.”
He said, “The work for installation of meters in the city would start soon. MYT system will also help in providing clarity on the rules to be applied over a pre-defined future time period in advance.”
The states like Andhra Pradesh, Maharashtra, Karnataka, Delhi, Rajasthan among others have already introduced the multi-year
tariff model