Relief for electricity consumers: AP govt to bear ₹4,500 Cr 'True-Up' burden

The Andhra Pradesh government has taken a major step to shield electricity consumers from a massive financial burden. The state will directly pay off ₹4,500 crore in pending “true-up” dues accumulated by the state’s electricity distribution companies (DISCOMs) during the previous YSR Congress administration (2019-2024), instead of passing the cost onto consumers.

The announcement was made on Friday by P. Krishna, Secretary of the Andhra Pradesh Electricity Regulatory Commission (APERC), who emphasized that the move would prevent an immediate surge in electricity bills, commonly referred to as a “tariff shock.”

True-up charges arise when there is a difference between the actual cost of electricity (including purchase and fuel costs) and the tariff collected from consumers. DISCOMs can recover such shortfalls from future electricity bills. However, over the past five years, these dues were allowed to accumulate without adjustment, reaching ₹4,500 crore. Had these been passed to consumers, each household would have faced several thousand rupees in additional charges. Recognizing this, the current government has pledged to cover the full amount from its own funds.

APERC’s review shows the distribution of dues among the state’s three major DISCOMs: Andhra Pradesh Eastern Power Distribution Company: ₹1,783 crore; Southern Power Distribution Company: ₹1,552 crore; and Central Power Distribution Company: ₹1,163 crore.

If the government had not intervened, these dues would have been collected from current electricity bills, resulting in a sudden hike in charges for households across the state. By stepping in, the government ensures that consumers do not bear any additional financial burden while DISCOMs receive immediate funds, improving their financial stability.

APERC noted that the accumulated dues were primarily due to inadequate financial management, delayed policy decisions, and deferred adjustments by the previous administration, which created significant pressure on the electricity sector.

With this intervention, DISCOMs can now claim the dues directly from the state government, ensuring timely funding and uninterrupted, high-quality electricity supply to consumers. The decision, which corrects five years of fiscal mismanagement without affecting household wallets, has been widely welcomed across Andhra Pradesh.