Facing a significant revenue deficit, the state-run power trading utility Grid Corporation of Odisha Limited (GRIDCO) has proposed a 54 paise per unit hike in the bulk supply tariff for the 2025-26 financial year. GRIDCO projects its aggregate revenue requirement (ARR) at ₹14,820.37 crore for the upcoming fiscal year and has urged the Odisha Electricity Regulatory Commission (OERC) to approve the new bulk supply price (BSP) at 381.84 paise per unit, up from the current 328.20 paise per unit.
GRIDCO justifies the requested hike by highlighting a projected revenue deficit of ₹1,728 crore at the existing BSP, as the income from the sale of power to four distribution companies is expected to be around ₹13,092.36 crore. The proposed increase of 53.64 paise per unit, amounting to a 16.34% rise, is likely to raise retail prices, further burdening domestic consumers already facing higher tariffs following the privatization of the power distribution sector.
GRIDCO estimates the state’s energy requirement for the forthcoming financial year at 40,117 million units, including a 3% transmission loss. In its ARR and bulk tariff applications submitted to OERC, GRIDCO points out that it incurs higher power costs during peak seasons, particularly in summer months, due to the overdraw of energy by distribution companies beyond their schedules.
“In such situations, GRIDCO is obligated to pay at a higher rate and suffers huge deficits due to unforeseen additional costs that cannot be adequately compensated through the approved BSP,” the petition states.
The petition also notes that GRIDCO has been facing cash deficits over the years due to non-cost reflective tariffs in bulk supply prices, revenue gaps allowed in the ARR, disallowed carrying costs on regulatory assets, and outstanding BSP dues and other receivables from the erstwhile distribution companies before Tata Power took over management.
GRIDCO has managed these cash deficits through working capital loans and long-term borrowings, with total outstanding loans amounting to ₹5,969.89 crore as of September 30, 2024. The repayment liability for 2025-26 is ₹1,001.78 crore towards loans from commercial banks and securitized dues of OHPC, GRIDCO added.
In the tariff order for the current financial year, OERC reduced the bulk supply tariff for GRIDCO from 329 paise per unit to 328.94 paise per unit, while providing a 10 paise per unit relief to domestic consumers.