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Tribunal Ruling: Power Tariff May Head South

Electricity tariff for households could come down as a result of the judgment of the Appellate Tribunal for Electricity.

Published: 08th April 2016 04:03 AM  |   Last Updated: 08th April 2016 01:04 PM   |  A+A-

electric-pylons

The sun sets behind electric pylons in Allahabad in this February 22, 2006 file photo. REUTERS

NEW DELHI:  Electricity tariff for households could come down as a result of the judgment of the Appellate Tribunal for Electricity on Thursday.

The judgment says that tariff discovered through the competitive bidding route is sacrosanct and that the electricity regulatory commission does not have powers to amend or modify the tariff so discovered. The price charged by generation companies directly converts into tariff paid by consumers. Distribution companies sign contracts with the former after discovering the lowest price through a bidding process. If compensatory tariffs were allowed in addition to such quoted prices, it would result in the increase of tariffs ultimately paid by ordinary consumers.

“There was uncertainty over the last few years on the sanctity of tariff discovered through a competitive bidding process. This judgment puts a quietus on the issue,” Sakya Singha Chaudhuri Partner, HSA Advocates.

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