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					</table>The Karnataka Electricity Regulatory Commission (<a href="https://kerc.karnataka.gov.in/en" target="_blank" rel="noopener">KERC</a>) has increased the average retail electricity tariff for all low-tension (LT) and high-tension (HT) categories by ₹0.70 (~$0.008)/kWh for the financial year (FY) 2023-24.
It was increased by 8.31% to ₹9.12 (~$0.011)/kWh compared to ₹8.42 (~$0.10)/kWh in FY23.
The revised tariff will be applicable from April 1, 2023.
Of the increase, ₹0.57 (~$0.007)/kWh will be recovered through fixed charges, and the remaining ₹0.13 (~$0.002)/kWh will be recovered as energy charges.
The electricity supply companies (ESCOMs), in their submission, had recommended an average increase of ₹1.39 (~$0.017)/kWh in tariff.
As a relief measure and to encourage the adoption of electric vehicles in the state, the Commission reduced the tariff for EV charging stations to ₹4.50 (~$0.054)/kWh as against the existing rate of ₹5 (~$0.061)/kWh.
The green tariff of ₹0.50 (~$0.006)/kWh for renewable electricity on top of the applicable tariff for HT industrial and HT commercial customers will continue.
Also, the rebate of ₹0.50 (~$0.006)/kWh for micro and small industries will continue for another year.
Under the Discounted Energy Rate program, KERC has reduced the energy charges to ₹5 (~$0.061)/kWh as against the existing rate of ₹6 (~$0.073)/kWh. Earlier, the program applied to HT consumers, which has now been extended to LT Industries and commercial installations with a sanctioned load of 50 kW and above.
To simplify the tariff structure, the number of consumer categories has been reduced to 21 from 31.
The Commission has directed the distribution companies (DISCOMs) to set up a portal to maintain the details of PPAs executed and approved by the competent authorities to monitor the terms and conditions of the PPAs and also to regulate the payment of power purchase bills online.
The portal should be made operational within three months.
The Commission has set a revised transmission tariff for the Karnataka Power Transmission Corporation (<a href="https://kptcl.karnataka.gov.in/english">KPTCL</a>) as ₹163,031 (~$1,971)/MW per month for FY 2024 against the transmission tariff of ₹172,897 (~$2,090)/MW per month approved earlier.
Annual Revenue Requirement 
The Commission approved a total Annual Revenue Requirement (ARR) of ₹581.09 billion (~$7.03 billion) as against ₹621.33 billion (~$7.51 billion) sought by the ESCOMs in their tariff applications.
Also, the Commission approved a net revenue deficit of ₹44.571 billion (~$539.02 million) for FY 2024, which included a revenue deficit of ₹17.201 billion (~$208.02 million) as per the annual performance review for FY 2022.
The proposed and approved ARR for ESCOMs
<a href="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024.png"><img loading="lazy" decoding="async" class="alignnone wp-image-54761 size-full" src="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024.png" alt="KERC-State-wise Approved ARR for FY 2024" width="374" height="197" srcset="https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024.png 374w, https://mercomindia.s3.ap-south-1.amazonaws.com/wp-content/uploads/2023/05/KERC-State-wise-Approved-ARR-for-FY-2024-300x158.png 300w" sizes="auto, (max-width: 374px) 100vw, 374px" /></a>
The Commission has approved a total ARR of ₹288.73 billion (₹3.49 billion) for the Bangalore Electricity Supply Company (<a href="https://bescom.karnataka.gov.in/english" target="_blank" rel="noopener">BESCOM</a>), whereas for the Mangalore Electricity Supply Company (<a href="https://mescom.karnataka.gov.in/english" target="_blank" rel="noopener">MESCOM</a>), the approved amount is ₹47.71 billion (~$577.2 million).
For the Chamundeshwari Electricity Supply Company (<a href="https://cescmysore.karnataka.gov.in/english" target="_blank" rel="noopener">CESC</a>), the approved ARR amount is ₹61.48 billion (~$743.7 million), whereas for the Hubli Electricity Supply Company (<a href="https://hescom.karnataka.gov.in/english" target="_blank" rel="noopener">HESCOM</a>) and the Gulbarga Electricity Supply Company (<a href="https://gescom.karnataka.gov.in/english" target="_blank" rel="noopener">GESCOM</a>), the approved ARR amount is ₹108.89 billion (~$1.32 billion) and ₹74.28 billion (~$898.5 million), respectively.
Hukkeri Rural Electric Cooperative Society
KERC has approved an ARR of ₹2.56 billion (~$30.96 million) for FY 2024 compared to ₹3.1 billion (~$37.49 million) approved by the Hukkeri Rural Electric Cooperative Society. The approved net revenue deficit for FY 2024 has been calculated as ₹22.8 million (~$275.73 million). The subsidy approved for free power has been set as ₹1.11 billion (~$13.42 million) for FY 2024.
ARR for Special Economic Zones 
KERC has approved the revised ARR of ₹701.4 million (~$8.48 million) for FY 2024 against ₹573.4 million (~$6.93 million) proposed by the Mangalore Special Economic Zone. The approved net revenue deficit for FY 2024 has been set as ₹17.88 million (~$216,234).
The Commission has also approved the revised ARR of ₹259.76 million (~$3.14 million) for FY 2024 against ₹248.3 million (~$3.01 million) proposed by AEQUS Special Economic Zone. The approved net revenue deficit for FY 2024 has been calculated as ₹1.06 million (~$12,819).
In January this year, DISCOMs of Karnataka <a href="https://www.mercomindia.com/karnataka-tariff-hike-proposal-to-deter-availing-open-access" target="_blank" rel="noopener">proposed</a> revised tariffs for LT and HT consumers, which included grid support charges for captive open access power consumers.
Subscribe to Mercom’s real-time <a href="https://mercomindia.com/product/mercoms-renewable-energy-regulatory-updates/" target="_blank" rel="noopener">Regulatory Updates</a> to ensure you don’t miss any critical updates from the renewable industry.

Karnataka Increases Average Retail Electricity Tariff by ₹0.70/kWh for FY24

The Karnataka Electricity Regulatory Commission (<a href="https://karunadu.karnataka.gov.in/kerc/Pages/home.aspx" target="_blank" rel="noopener noreferrer">KERC</a>) has issued a discussion paper on wheeling charges and banking facilities for renewable projects.
The Commission noted that there was a need to revise the transmission and wheeling charges applicable to non-REC (renewable energy certificate) route based renewable power projects and examine the banking facility extended to them.
The Commission has invited comments and suggestions from interested stakeholders on or before September 23, 2020.
Background
The Commission, in its order dated May 14, 2018, had <a href="https://mercomindia.com/karnataka-wheeling-charges-renewables/" target="_blank" rel="noopener noreferrer">revised</a> the wheeling charges for renewable power projects, which was effective from April 01, 2018, and was challenged by various renewable generators.
The government of Karnataka had requested the Commission to remove the banking facilities given to renewable energy generators.
The government had said that the present provision under banking that allowed energy generated during off-peak periods to be used at peak periods, forced electricity supply companies (ESCOMs) to buy costly power, and the payment of the banked energy was at 85% of the generic tariff. So, the government had requested the Commission to remove the banking facility and amend the wheeling and banking agreement (WBA).
Consecutively, through its letter dated January 09, 2018, the Commission <a href="https://mercomindia.com/karnataka-banking-period-solar-renewable/" target="_blank" rel="noopener noreferrer">reduced</a> the banking period from one year to six months. It further ordered that the energy banked by the non-REC route based renewable projects during the peak time of the day could be used only during the peak time of day hours. The generators challenged this order, and the Appellate Tribunal for Electricity (APTEL) remitted the order back to the Commission and requested the Commission to pass fresh orders.
In the latest discussion paper, the Commission proposed to levy 50% of the normal transmission and wheeling charges payable in cash, as determined by the Commission from time to time. This charge would be applicable for those renewable sources transmitting or wheeling electricity using the network of the transmission licensee or the distribution licensee.
In addition to this, applicable losses, as approved by the Commission, would be deducted from the net injected energy to arrive at the amount of wheeled energy.
The Commission also proposed to discontinue the banking facility extended to solar, mini hydel, and wind power projects, for both REC and non-REC route-based projects. Any energy banked and unutilized at the end of each month will be considered to have been supplied to the concerned entity, it added.
The proposed changes will apply to all renewable energy generators who will enter into an agreement from the date of the order by the Commission. It will exclude those projects that have been commissioned on or before March 31, 2018, and have not completed ten years from the date of the commercial operation date (COD).
The above proposals will apply to those projects that have completed the initial term of the wheeling agreement and desire to renew it.
The control period for the wheeling charges will be from the date of the order up to March 31, 2022. The removal of the banking facility will also be effective from the date of the issuance of the order by the Commission or any government order in the matter, whichever is earlier.
According to Mercom’s <a href="https://mercomindia.com/product/india-solar-project-tracker/" target="_blank" rel="noopener noreferrer">India Solar Project Tracker</a>, Karnataka has an installed large-scale solar capacity of over 7.3 GW. It has a development pipeline of ~343 MW, making it the leading solar state of the country.
Recently, the Government of Karnataka <a href="https://mercomindia.com/karnataka-wheeling-banking-captive-solar-projects/" target="_blank" rel="noopener noreferrer">held</a> a meeting to discuss the banking and wheeling charges for grid-connected renewable projects in the state. In the meeting, the government decided that for grid-connected captive solar projects, the consumer will be required to enter into an agreement for the wheeling and banking charges.

Karnataka: Stakeholder Comments Invited on Removal of Banking Facility for Renewables

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