# MERC Maharashtra State Electricity Distribution Co. Ltd. Multi-Year Tariff (MYT) Order for FY2025-26 to FY2029-30 (Case No. 217 of 2024)

- **Issuing authority:** Maharashtra Electricity Regulatory Commission (MERC)
- **Case number:** 217 of 2024
- **Order date:** 28 March 2025
- **Petitioner:** Maharashtra State Electricity Distribution Co. Ltd. (MSEDCL)
- **Order type:** Multi-Year Tariff (MYT) Order
- **Control period:** CP-5 (FY2025-26 to FY2029-30)
- **Tariff regime:** Section 62, Electricity Act 2003
- **Length:** 790 pages
- **Official PDF:** https://merc.gov.in/wp-content/uploads/2025/03/MSEDCL-MYT-Order_Case_no_217-of-2024.pdf

## Section index

| Section | Title | Page |
|---|---|---|
| 1 | Introduction | 39 |
| 1.1 |  Background | 39 |
| 1.2 |  Admission of the Petition and Regulatory Process | 40 |
| 1.3 |  Organisation of the Order | 40 |
| 2 | Suggestions / Objections, MSEDCL’s Response and Commission’s Rulings | 40 |
| 2.1 |  Background | 43 |
| 2.2 |  Agricultural Consumption, Tariff for Agriculture and Distribution Loss | 45 |
| 2.3 |  Time of Day (ToD) Tariff | 51 |
| 2.4 |  Reverse Telescopic Tariff | 60 |
| 2.5 |  Grid Support Charges (GSC) | 63 |
| 2.6 |  Power Procurement Plan and Costs | 67 |
| 2.7 |  kVAh Billing | 70 |
| 2.8 |  Wheeling Charges | 71 |
| 2.9 |  Issues related to Open Access | 75 |
| 2.10 |  Tariff Revision | 81 |
| 2.11 |  Applicability of Bulk Consumption Rebate | 84 |
| 2.12 |  Tariff Re-Categorisation (Hotels, Power looms, milk processing farmers, Tissue Culture, Khawa Industry etc) | 85 |
| 2.13 |  Separation of AG and Non-AG company | 90 |
| 2.14 |  Prepaid and Smart Meters | 91 |
| 2.15 |  Green Tariff | 95 |
| 2.16 |  Not issuing Energy Bills to AG consumers: | 96 |
| 2.17 |  Commercial tariff on Advocate Office | 97 |
| 2.18 |  RPO Compliance | 98 |
| 2.19 |  Financial Mismanagement | 100 |
| 2.20 |  Increase in Fixed Charges | 105 |
| 2.21 |  Increase in Energy Charges | 107 |
| 2.22 |  FAC (Fuel Adjustment Charges) | 110 |
| 2.23 |  Separate Construction Meter | 112 |
| 2.24 |  Demand Side Management (DSM) Program | 113 |
| 2.25 |  Wire and Retail Business | 115 |
| 2.26 |  Virtual Net Metering | 115 |
| 2.27 |  Installation of Battery Energy Storage Systems (BESS) by Industries | 116 |
| 2.28 |  Capital Expenditure | 119 |
| 2.29 |  Working Capital | 119 |
| 2.30 |  Operation & Maintenance Expenses (O&M) | 120 |
| 2.31 |  Tariff for Co-operative Water Users Associations having HT connections | 122 |
| 2.32 |  Standby Charges | 124 |
| 2.33 |  Tariff for EV Charging | 126 |
| 2.34 |  Resource Adequacy Planning | 127 |
| 2.35 |  Improvement in Consumer Services | 129 |
| 2.36 |  Accounting of MSEDCL's Own Consumption | 130 |
| 2.37 |  Functioning of Forums: | 130 |
| 2.38 |  Compulsion to opt for Solar Pump connections: | 133 |
| 2.39 |  Schedule of Charges: | 133 |
| 3 | True-up of FY 2022-23 and FY 2023-24 | 133 |
| 3.1 |  Background | 134 |
| 3.2 |  Category Wise Sales for FY 2022-23 and FY 2023-24 | 136 |
| 3.3 |  Distribution Losses for FY 2022-23 and FY 2023-24 | 150 |
| 3.4 |  Energy Balance for FY 2022-23 & FY 2023-24 | 154 |
| 3.5 |  Power Purchase Expenses for FY 2022-23 and FY 2023-24 | 161 |
| 3.6 |  Transmission Constraints Leading to Increase in the Power Purchase Cost | 178 |
| 3.7 |  RPO Compliance for FY 2022-23 and FY 2023-24 | 179 |
| 3.8 |  InSTS Charge and MSLDC Charge for FY 2022-23 and FY 2023-24 | 186 |
| 3.9 |  O&M Expenses for FY 2022-23 and FY 2023-24 | 188 |
| 3.10 |  Opex Schemes expenses for FY 2022-23 and FY 2023-24 | 202 |
| 3.11 |  Capitalisation for FY 2022-23 and FY 2023-24 | 206 |
| 3.12 |  Depreciation for FY 2022-23 and FY 2023-24 | 213 |
| 3.13 |  Funding Arrangement for FY 2022-23 and FY 2023-24 | 215 |
| 3.14 |  Interest Expenses for FY 2022-23 and FY 2023-24 | 217 |
| 3.15 |  Interest on Working Capital and Interest on Security Deposit for FY 2022-23 and FY 2023-24 | 220 |
| 3.16 |  Other Finance Charges for FY 2022-23 and FY 2023-24 | 226 |
| 3.17 |  Provision for Bad and Doubtful Debts for FY 2022-23 and FY 2023-24 | 227 |
| 3.18 |  Other Expenses for FY 2022-23 and FY 2023-24 | 230 |
| 3.19 |  Contribution to Contingency Reserves for FY 2022-23 and FY 2023-24 | 234 |
| 3.20 |  Income Tax for FY 2022-23 and FY 2023-24 | 234 |
| 3.21 |  Incentives and Discounts for FY 2022-23 and FY 2023-24 | 236 |
| 3.22 |  RLC Refund for FY 2022-23 and FY 2023-24 | 237 |
| 3.23 |  Additional Surcharge (ASC) Refund | 237 |
| 3.24 |  Return on Equity for FY 2022-23 and FY 2023-24 | 239 |
| 3.25 |  Sharing of Efficiency Gains and Losses for FY 2022-23 and FY 2023-24 | 244 |
| 3.26 |  Impact of payment to MPECS for FY 2022-23 and FY 2023-24 | 252 |
| 3.27 |  Incremental Consumption and Bulk Consumption Rebate for FY 2022-23 and FY 2023-24 | 253 |
| 4 | Provisional True-up for FY 2024-25 | 253 |
| 4.1 |  Category Wise Sales for FY 2024-25 | 266 |
| 4.2 |  Distribution Losses for FY 2024-25 | 268 |
| 4.3 |  Energy Balance for FY 2024-25 | 269 |
| 4.4 |  Power Purchase Expenses for FY 2024-25 | 274 |
| 4.5 |  Transmission Charges for FY 2024-25 | 281 |
| 4.6 |  O&M Expenses for FY 2024-25 | 282 |
| 4.7 |  Opex Schemes for FY 2024-25 | 284 |
| 4.8 |  Capitalisation for FY 2024-25 | 287 |
| 4.9 |  Depreciation for FY 2024-25 | 292 |
| 4.10 |  Funding Pattern for FY 2024-25 | 292 |
| 4.11 |  Interest Expenses for FY 2024-25 | 294 |
| 4.12 |  Interest on Working capital and Interest on SD for FY 2024-25 | 297 |
| 4.13 |  Other Finance Charges for FY 2024-25 | 301 |
| 4.14 |  Provision for Bad and Doubtful Debts for FY 2024-25 | 302 |
| 4.15 |  Other Expenses for FY 2024-25 | 304 |
| 4.16 |  Contribution to Contingency Reserves for FY 2024-25 | 306 |
| 4.17 |  Income Tax for FY 2024-25 | 306 |
| 4.18 |  Incentives and Discounts for FY 2024-25 | 308 |
| 4.19 |  Return on Equity for FY 2024-25 | 310 |
| 4.20 |  Revenue Gap Recovery Allowed for FY 2024-25 | 311 |
| 4.21 |  Impact of payment to MPECS for FY 2024-25 | 311 |
| 4.22 |  Incremental Consumption and Bulk Consumption Rebate for FY 2024-25 | 313 |
| 4.23 |  RLC Refund for FY 2024-25 | 314 |
| 4.24 |  Additional Surcharge (ASC) refund for FY 2024-25 | 315 |
| 4.25 |  Revenue from sale of electricity for FY 2024-25 | 316 |
| 4.26 |  Non-Tariff Income for FY 2024-25 | 318 |
| 4.27 |  Income from Open Access Charges for FY 2024-25 | 318 |
| 4.28 |  Income from Trading of Surplus Power for FY- 2024-25 | 319 |
| 5 | Projection of ARR for 5th Control Period from FY 2025-26 to FY 2029-30 | 319 |
| 5.1 |  Approach for Sales Projection for Control Period | 326 |
| 5.2 |  Resource Adequacy and Power Procurement Planning | 348 |
| 5.3 |  Scrutiny of the RA Planning as per the provisions of the MERC RA Regulations, 2024 | 350 |
| 5.4 |  Generation Resource Planning | 357 |
| 5.5 |  Power Procurement Planning | 369 |
| 5.6 |  Distribution Loss trajectory for Control Period | 374 |
| 5.7 |  AT &C Loss Trajectory for Control Period | 375 |
| 5.8 |  Energy Balance for Control Period | 377 |
| 5.9 |  Assumptions for projecting power purchase for the 5th Control Period | 384 |
| 5.10 |  Intra-state Transmission Charges for the 5th Control Period | 411 |
| 5.11 |  O&M Expenses for FY 2025-26 to FY 2029-30 | 412 |
| 5.12 |  OPEX for FY 2025-26 to FY 2029-30 | 416 |
| 5.13 |  Capex and Capitalisation for FY 2025-26 to FY 2029-30 | 421 |
| 5.14 |  Funding Pattern of the Capitalisation for FY 2025-26 to FY 2029-30 | 426 |
| 5.15 |  Depreciation for 5th Control Period | 427 |
| 5.16 |  Interest on Long Term Loan | 429 |
| 5.17 |  Interest on Working Capital | 432 |
| 5.18 |  Other Finance Charges | 432 |
| 5.19 |  Provision for Bad Debts | 437 |
| 5.20 |  Other Expenses | 440 |
| 5.21 |  Contribution to Contingency Reserves | 441 |
| 5.22 |  Incentives and Discounts | 444 |
| 5.23 |  Additional Surcharge Refund | 444 |
| 5.24 |  Incremental and Bulk Consumption Rebate | 445 |
| 5.25 |  Income Tax | 445 |
| 5.26 |  Return on Equity | 447 |
| 5.27 |  Implementation of Demand Side Management Program | 452 |
| 5.28 |  Revenue from sale of electricity | 456 |
| 5.29 |  Non-Tariff Income | 457 |
| 5.30 |  Income from Open Access Charges | 458 |
| 5.31 |  Income from Additional Surcharge | 460 |
| 6 | Additional claims and revenue gap | 460 |
| 6.1 |  Impact of Review Order | 467 |
| 6.2 |  Carrying Cost in previous Gap and other Claims | 470 |
| 6.3 |  Carrying/ (Holding) Cost on unrecovered revenue gap for 5th Control Period | 472 |
| 6.4 |  Impact of AFC for Ghatghar for Past Period | 474 |
| 6.5 |  Impact of Revenue Gap of MSPGCL Tariff Order | 474 |
| 6.6 |  Net Recovery from Tariff | 475 |
| 7 | Tariff Philosophy, tariff design and category-wise tariff's from FY 2025-26 to FY 2029-30 | 475 |
| 7.1 |  Overall Approach for Tariff Design | 476 |
| 7.2 |  Applicability of Tariffs | 476 |
| 7.3 |  Average Cost of Supply | 485 |
| 7.4 |  Balancing of ABR and ACoS for Revenue Recovery over the Control Period | 486 |
| 7.5 |  Premise for Determination of Tariff | 486 |
| 7.6 |  Segregation of ARR & Determination of AG ACoS & Non-AG Supply ACoS | 488 |
| 7.7 |  Key Consideration for Tariff Design | 518 |
| 7.8 |  Proposed Tarif and Rationale of Tariff Hike as submitted by MSEDCL | 521 |
| 7.9 |  Proposed Recovery from Tariff (ABR) as approved by Commission | 532 |
| 7.10 |  Tariff Philosophy proposed by MSEDCL and Commission’s Rulings | 542 |
| 7.11 |  Full Cost Recovery | 543 |
| 7.12 |  Rationalization of Fixed Cost | 545 |
| 7.13 |  Time of Day Tariff | 546 |
| 7.14 |  Grid Support Charges | 575 |
| 7.15 |  Change in application of telescopic tariff for Domestic consumers with RTS | 580 |
| 7.16 |  kVAh based billing | 583 |
| 7.17 |  Standby Charges for SEZs and Deemed Licensees | 585 |
| 7.18 |  Green Tariff | 587 |
| 7.19 |  Rebate for Incremental Consumption | 590 |
| 7.20 |  Bulk Consumption Rebate | 595 |
| 7.21 |  Discount in Demand Charges for Single Shift operation of HT-Industry | 595 |
| 7.22 |  Miscellaneous and General Charges, Rebates and Penalties | 597 |
| 7.23 |  Rebates for consumers who avail their complete requirement from MSEDCL | 598 |
| 7.24 |  Compensation wheeling charges due to non-establishment of EHV network by MSETCL | 600 |
| 7.25 |  Reactive Charge from RE generators and Open Access Consumers | 601 |
| 7.26 |  Multiple Sources of Supply | 604 |
| 7.27 |  Tariff for LT and HT– Electric Vehicle (EV) Charging Stations | 605 |
| 7.28 |  Billing Demand | 606 |
| 7.29 |  Rebate for Advance Payment/Pre-payment | 610 |
| 7.30 |  Modification in Tariff Applicability | 611 |
| 7.31 |  Treatment to Energy Generated during the Regenerative Braking – Metro | 624 |
| 7.32 |  Solarization of Lift Irrigation Scheme | 625 |
| 7.33 |  Revised Tariff with effect from 1 April, 2025 | 626 |
| 7.34 |  Wheeling Charges | 637 |
| 7.35 |  Cross Subsidy Surcharge | 644 |
| 7.36 |  Additional Surcharge | 671 |
| 7.37 |  Issuance of Commercial Circular for Tariff Rates and related matters by MSEDCL | 671 |
| 8 | Compliance of earlier Directives | 671 |
| 8.1 |  Background | 679 |
| 8.2 |  Directive 1: Changes in ToD Tariff Structure | 679 |
| 8.3 |  Directive 2: Roadmap for Cross Subsidy Reduction | 681 |
| 8.4 |  Directive 3: Framework for Billing | 681 |
| 8.5 |  Directive 4: Protocol for automated measurement and reporting of Supply Availability | 682 |
| 8.6 |  Directive 5: Separate Agriculture Company | 685 |
| 8.7 |  Performance Review and Review of Compliance of Directions | 685 |
| 9 | Schedule of Charges | 685 |
| 9.1 |  Background | 686 |
| 9.2 |  Revision in schedule of charges | 690 |
| 9.3 |  Cost of Meter, Metering Cubicle Etc. | 697 |
| 9.4 |  Application Registration and Processing Charges | 699 |
| 9.5 |  Processing fees for change of name/ change of ownership of generator | 701 |
| 9.6 |  Charges for Open Access | 703 |
| 9.7 |  Miscellaneous and General Charges | 705 |
| 9.8 |  Reconnection Charges: | 708 |
| 9.9 |  Changing location of meter within same premises | 708 |
| 9.10 |  Shifting of utility services/ Poles/ Lines etc. | 709 |
| 9.11 |  Charges for Temporary Supply: | 710 |
| 9.12 |  Inspection & Testing of Meters, metering equipment and others | 712 |
| 9.13 |  Administrative charges for cheque bouncing: | 712 |
| 9.14 |  Performance Review and Review of Compliance of Directions | 717 |
| 10 | Applicability of the Order | 717 |
| 11 | Appendix-1: List of Persons Present at the Technical Validation Session on 26 December, 2024 | 717 |
| 12 | Appendix-2: List of Persons Present at the Public Hearing held between February 25, 2025 to March 4, 2025 | 717 |
| 13 | Annexure I: Tariff Schedule for 5th Control Period from FY 2025-26 to FY 2029-30 | 718 |

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