For next 3 months, brace for a bigger power bill

Your electricity bill generated for the month of October will not be the same, even if you have consumed the same number of units.

With Karnataka Electricity Regulatory Commission (KERC) giving its approval, the five escoms (electricity supply companies) will collect fuel cost adjustment charges (FAC) in the electricity bills issued to 2.138 crore consumers across the state from October 1 to December 31, 2018.

For the next three months, Bescom (Bangalore Electricity Supply Company Limited) will collect 14 paisa, Hescom (Hubli Electricity Supply Company Limited) eight paisa, Cesc (Chamundeshwari Electricity Supply Corporation Limited) and Gescom (Gulburga Electricity Supply Company Limited) will collect five paisa per unit.

What is FAC?

Fuel cost adjustment charges is the amount to be recovered from consumers based on the varying coal or fuel cost incurred by distribution companies during April to June. The price of fuel or coal changes every month based on demand and supply.

The electricity generation companies pass on this excess cost to distribution companies, who in turn, pass it on to consumers.

FAC of Mescom (Mangalore Electricity Supply Company Limited) at four paisa per unit is the lowest among all escoms. But MESCOM in its application, filed in September, had urged KERC to fix FAC at 7.56 paisa per unit.

“Mescom calculated FAC at 7.56 paisa. KERC also has a formula of its own to decide FAC for escoms,’’ sources
in Mescom said and added that four paisa per unit approved by KERC is also applicable to consumers of Mangalore Special Economic Zone (MSEZ).

Sources in Mescom (with an annual consumption of about 5,500 million units) admitted that the lowest FAC at four paisa per unit will turn upside down its calculations on power purchase and retail sales.

“We hope that the low FAC will help us justify a new tariff during KERC’s hearing on tariff hike,”” sources told DH.

KERC chairman Shankarlinge Gowda said that this fuel cost adjustment is done every three months, every year.

It is not unusual as the electricity act provides for fuel cost adjustments to be done every three months.

The rate of increase for each company is different based on their tarrif rates. The details are on the KERC website also.