Discoms proposal to increase wheeling charges to affect solar power plants

Wheeling charges are the charges levied by the electricity department for the distance the electricity is transported. The electricity board applies this charge when electricity is generated at one location but consumed at another.

Hyderabad: Wheeling charges on solar power plants in the State are likely to increase substantially as State-run power utilities have sent a proposal to the Telangana State Electricity Regulatory Commission (TGERC) to allow them to increase the existing wheeling charges.

Wheeling charges are the charges levied by the electricity department for the distance the electricity is transported. The electricity board applies this charge when electricity is generated at one location but consumed at another.

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Currently, the Southern Power Distribution Company of Telangana Limited (TGSPDCL) is charging a wheeling charge of Rs 38.82 per kilowatt generated in solar power plants of 33 KV voltage capacity under its jurisdiction. It has now requested the ERC to allow it to increase to Rs.397. Similarly, the Northern Power Distribution Company of Telangana Limited (TGNPDCL) has proposed to increase the current rate of Rs 72.29 to Rs. 732.

Discoms have been charging wheeling charges in three categories- 33 KV. 11 KV and low tension (LT). It has been proposed that from this year these three will be changed to one category and the same charge will be charged. If this is done, LT categories charges will be reduced and heavy financial burden will be imposed on 33 KV consumers. Most of the plants that use captive solar power are into open access business and sell to third parties at 33 KV level. That means the financial burden on industries will be high if the Discoms are allowed to increase the wheeling charges.

Meanwhile, Solar Power Plant Owners Association has submitted a representation to ERC chairman T Sriranga Rao, urging him not to accept the proposals of Discoms for an increase in wheeling charges. They said that if the proposal was accepted, private solar power generators would have no other option but to shut down their plants.

New tariff proposals along with the aggregate revenue requirement (ARR) for the year 2024-25 were filed by the two Discoms before the TGREC on September 18 by proposing the ARR at Rs. 57,857 crore and put the revenue generation at Rs. 44,835 crore, pegging the revenue gap at Rs. 13,022 crore seeking it from the State government in the form reimbursement/support in lieu of subsidies extended to the agriculture and a few other sectors.

If the proposal is accepted by the ERC, the High Tension (HT) category consumers will see a significant increase in their electricity charges. Both energy and fixed charges for HT consumers will go up. For those using loads at 33 KV and 132 KV/above, the charges will now be similar to those for consumers using 11 KV. The fixed charges for HT consumers will rise from Rs. 475 to Rs. 500 per KVA.