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APTEL Rules Wheeling Charges Should Be Levied Only on Actual Consumption

In a significant ruling, the Appellate Tribunal for Electricity (APTEL) has determined that wheeling charges for open access consumers must be levied only on the actual power drawn at the consumption end, not on the injected power. This decision ensures fair billing practices and prevents undue financial burdens on consumers availing open access.

Case Background

The case involved Pudumjee Paper Products Ltd. (PPPL), a captive consumer that obtained Short-Term Open Access (STOA) from M/s Sai Wardha Power Generation Ltd. in Maharashtra. However, the Maharashtra State Electricity Distribution Company Ltd. (MSEDCL) imposed wheeling and transmission charges on the total power injected at the source instead of the actual power consumed.

As a result, MSEDCL issued inflated bills from January 2015 onwards, leading to excess recovery of Rs2.21 crore. PPPL challenged this billing practice before the Maharashtra Electricity Regulatory Commission (MERC), but MERC ruled in favor of MSEDCL, upholding its billing methodology.

APTEL’s Ruling and Rationale

APTEL overturned MERC’s order, emphasizing that wheeling charges should only apply to actual consumption, not injected power. The key points of the ruling are:

• Regulatory Compliance: MSEDCL’s billing method was found to be contrary to the MERC Distribution Open Access (DOA) Regulations of 2014 and 2016.
• Legal Precedent: APTEL relied on its earlier decision in Appeal No. 20/2019, where a similar practice was declared unlawful, and refunds were ordered.
• Equal Treatment for Open Access Users: APTEL dismissed MSEDCL's argument that captive consumers should be treated differently from generators regarding wheeling charges, affirming that the DOA regulations apply equally to all open access users.
• Fair Pricing: The ruling protects consumers from unjustified financial burdens, ensuring that transmission and wheeling charges are applied fairly based on actual consumption.

Implications of the Ruling

Following this decision, APTEL has remanded the case back to MERC, directing it to issue revised orders in line with the ruling. This judgment is expected to:

• Prevent overcharging of open access consumers, particularly those using captive power.
• Set a clear legal precedent for future disputes related to transmission and wheeling charges.
• Encourage more industries and businesses to adopt open access, enhancing competition in the power market.
• Ensure better implementation of MERC's Open Access Regulations, promoting transparency in power transactions.

This verdict is a major win for open access consumers, reinforcing the principle that charges should be based on actual usage rather than estimated or injected power.