Tariff cut likely for regulated power companies

NEW DELHI: Regulated power plants may have to take a tariff haircut on return on equity and fixed costs, as the government is considering a demand from electricity distribution companies to lower costs amid the Covid-19 pandemic. Many distribution companies have declared force majeure, denying or deferring fixed charges for power not being used during the lockdown period.

The move, however, will meet with resistance from power producers. While most regulated power plants whose tariff is fixed by regulatory commissions are with NTPC LtdNSE 4.68 %, the entire hydro and gas-based generation capacity and some private thermal projects also fall in the category.