KERC Drafts New Fee Regulations 2024 To Address Rising Operational Costs And Enhance Regulatory Efficiency

Posted On - 4 December, 2024 • By - King Stubb & Kasiva

Introduction

The Karnataka Electricity Regulatory Commission (KERC) has announced the draft of the Karnataka Electricity Regulatory Commission (Fee) Regulations, 2024.[1] This update to the 2016 regulations is driven by the need to adjust fees in response to increased operational costs and ensure the KERC can effectively fulfil its regulatory duties.  

Explanation (Key Points)

  • Rising Operational Costs: The KERC’s operational costs have substantially increased since 2016 due to inflation, impacting recurring expenditures.  
  • Revised Fees: The draft regulations propose new fees for various KERC functions, including issuing licenses, determining tariffs, and resolving disputes.
  • Stakeholder Input: Stakeholders and interested parties can submit their views, suggestions, or objections to the draft regulations within 15 days of its publication in the official gazette.  
  • Key Definitions: The regulations define terms like “Act,” “Commission,” and “Licensee,” providing clarity and context.  
  • Annual License Fees: The regulations specify annual license fees for different licensees, including Transmission Licensees, Distribution Licensees, and Electricity Traders.
  • Fees for Various Petitions: The regulations outline fees for petitions related to tariff determination, approval of agreements, and review of Commission orders.
  • Payment Methods: Fees can be paid through bank drafts, cheques, or electronic transfers (RTGS/NEFT).  
  • Repeal and Amendments: The 2016 regulations are repealed, but actions taken under those regulations are still considered valid. The KERC can also amend the new regulations as needed.  

Conclusion

The KERC’s proactive approach to revise its fee structure is crucial for maintaining operational efficiency and ensuring continued effectiveness in regulating the electricity sector. The updated regulations aim to align with the current economic landscape and support the KERC’s mandate.

[1] https://kerc.karnataka.gov.in/uploads/media_to_upload1730983502.pdf