AP power sector achieves turnaround, saves Rs 895 cr from purchases in FY24-25

Amaravati: In a significant achievement, Andhra Pradesh power sector, which has long been debt-ridden, has achieved a remarkable milestone by saving as much as Rs895.12 crore during the last financial year.

Noting these landmark savings in the Fuel and Power Purchase Cost Adjustment (FPPCA), the AP Discoms will refund the amount to all electricity consumers in the State starting November this year.

AP Electricity Regulatory Commission (APERC) has said that an expenditure of Rs1,863.64 crore was incurred under FPPCA, against budgeted Rs2,758.76 crore or expected earlier for FY 2024–25. This has resulted in savings/reduction of Rs895.12 crore.

Earlier, APERC had levied an FPPCA charge of 40 paise per unit on consumers for FY 2024–25. Out of this, there has now been a return of Rs895 crore, which the AP Distribution utilities will credit back to consumers.

As per computation arrived by the APERC, a refund of approximately 13 paise per unit will be credited to consumers in equal monthly instalments, and it shall be automatically adjusted in their final bill. Refunds for consumption months April 2024 to March 2025 will be credited from November 2025 to October 2026 in monthly cycles.

The discount will be applicable on the power consumption bill of the October month.

It is also pertinent to note that for the first time since electricity sector reforms began in 1999, AP power distribution utilities will refund FPPCA amounts to consumers in monthly instalments. This marks a milestone in pro-consumer governance and financial prudence in the power sector.

Rs0.13/kWh (as per APERC’s order) will be refunded monthly. The refund will automatically be credited as a separate negative FPPCA line item and no action is required from consumers, according to a media release.