Kashmir Impulse Desk
Srinagar, Aug 28
Jammu and Kashmir’s industrial sector has asked the electricity regulator to reconsider a nearly 10 percent increase in industrial energy charges, saying the final tariff is substantially higher than the 5 percent increase proposed during stakeholder consultations.
The Federation of Chambers of Industries Kashmir (FCIK) has filed a 17-page review petition before the Joint Electricity Regulatory Commission (JERC) against its August 20 tariff order, which takes effect from September 1.
The petition seeks a limited review of industrial tariffs rather than reopening the entire tariff determination.
FCIK said the tariff proposal placed before stakeholders envisaged a 5 percent across-the-board increase, while the final order raised the LT industrial energy charge from Rs 4.20 per kVAh to Rs 4.60, an increase of 9.52 percent.
The 11-kV HT industrial charge rose from Rs 4.10 to Rs 4.50 per kVAh, an increase of 9.76 percent.
Fixed and demand charges were also increased.
The industry said the overall tariff revenue increase of 6.83 percent, from Rs 7352.87 crore to Rs 7854.94 crore, did not reflect the burden on individual consumer categories.
FCIK has not challenged the regulator’s authority to depart from a tariff proposal.
Instead, it has questioned the absence of a category-specific explanation for imposing a substantially higher increase on industrial consumers.
A central issue in the petition is the absence of category-wise and voltage-wise cost-of-supply data.
FCIK said JERC had recorded that the distribution companies had not provided the required data despite earlier directions.
It questioned how a near-10 percent increase in industrial charges could be justified without reliable data on the cost of supplying electricity to industry.
The industry also challenged the use of a combined Average Cost of Supply of Rs 6.88 per kWh, saying a system-wide average could not establish the actual cost of supplying LT and HT industrial consumers.
Distribution losses are another focus of the petition. FCIK said organised industrial consumption is substantially metered, while HT consumers are subject to detailed energy and demand metering.
It questioned why industrial consumers should bear costs associated with technical losses, theft, unmetered consumption, billing problems or collection failures elsewhere in the distribution system.
The petition also challenged the use of a 93 percent collection-efficiency assumption by the distribution companies, arguing that consumers who regularly pay their bills should not bear the cost of dues that remain unrecovered from others.
FCIK has sought scrutiny of more than Rs 102 crore in bad-debt provisions – Rs 51.80 crore for KPDCL and Rs 50.96 crore for JPDCL – and asked for category-wise data on arrears, write-offs and recoveries.
It also questioned how the approved aggregate revenue requirement of Rs 10,275.72 crore is distributed among consumer categories in the absence of category-wise cost-of-supply data.
The industry said the tariff increase would add to pressure on manufacturers already facing high freight costs, difficult terrain, limited market access and, in Kashmir, a relatively short effective working season.
FCIK said many industrial units were operating below capacity and that higher electricity costs could further weaken their competitiveness.
The petition also pointed to limited projected industrial growth. KPDCL expects LT industrial connected load to rise only modestly between 2026-27 and 2028-29, while JPDCL’s projected industrial load remains largely unchanged.
The industry contrasted that outlook with projected growth in domestic consumers.
FCIK also questioned the stakeholder consultation process, saying industry representatives did not have adequate notice or an opportunity to respond specifically to the final near-10 percent increase because the proposal circulated for consultation had envisaged a 5 percent rise.
The petition has sought a stay on the enhanced industrial tariff pending its disposal and asked that existing LT and HT industrial consumers continue to be billed at the previous rates, subject to later adjustment.
Alternatively, it has asked that any industrial increase be capped at 5 percent pending the availability of reliable category-wise and voltage-wise cost-of-supply data.
The industry has also asked JERC to direct KPDCL and JPDCL to provide detailed data on supply costs, losses, theft, collection efficiency, arrears, bad debts and network costs.
FCIK said it was not seeking exemption from legitimate electricity costs but objected to industrial consumers being made to bear costs arising from losses, non-collection, or other inefficiencies without evidence linking those costs to industry.
