KERC allows extra charge for employee pensions in Karnataka

The Karnataka Electricity Regulatory Commission (KERC) has approved a new charge for electricity consumers in Karnataka. Starting on April 1, 2025, customers will pay an additional 36 paise per unit. This extra charge is to cover the government’s share of pension and gratuity for employees of the Karnataka Power Transmission Corporation Ltd (KPTCL) and electricity supply companies (escoms). This decision means that power bills in the state will increase. Just days before this announcement, the Bangalore Electricity Supply Company proposed a further tariff hike of 67 paise per unit for the upcoming financial year. If approved, consumers in Bengaluru might face a total increase of ₹1.03 per unit starting April 1. However, many residential consumers may not be greatly affected. A significant number are enrolled in the Gruha Jyothi scheme, which provides free electricity for usage up to 200 units. The state budget has allocated ₹10,100 crore for this scheme, an increase from the previous year. Energy Minister K.J. George attributed the new charge to the previous Bharatiya Janata Party (BJP) government. He stated that the BJP first proposed this pension and gratuity recovery plan in March 2022. Despite initial refusal from KERC, changes in the Karnataka Electricity Reform Rules later allowed escoms to request this recovery from consumers. A previous legal challenge against this proposal was dismissed by the High Court in March 2024. Following that ruling, escoms filed a new petition, which led to KERC's current order. This additional charge will be applied over three years: 36 paise in 2025-26, 35 paise in 2026-27, and 34 paise in 2027-28. Overall, escoms expect to raise over ₹2,800 crore through this measure.