Discoms barred from levying electricity duty on those buying power from open market

The state’s all the five government-owned power distribution companies (discoms) have been restrained from realizing the electricity duty (ED) from the industries that buy power from other states through Open Access.

The ban, according to a senior energy department official, comes after some industry captains recently met chief secretary Rajendra Kumar Tiwari and urged him to issue orders preventing discoms from levying ED on open access consumers against the rules, failing which, they cautioned, many industries might shift to other states for cheaper power.

The development is being seen as a big ‘shock’ to the cash-strapped UP Power Corporation Ltd (UPPCL) that holds the five discoms since for it this will mean loss of around ₹800 crore revenue that it realises as ED from the Open Access consumers alone.

Open Access is a system that enables consumers with heavy load to buy cheap power from the open market. This allows consumers to choose from a number of competitive power suppliers anywhere in the country rather than being forced to purchase electricity from local power utility. The local utility may realize wheeling charges from such consumers for wheeling other company’s power to them.

hindustan times
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