Section 144 in The U.P. Electricity Regulatory Commission (Conduct of Business) Regulations, 2004
144. Subsidy from Government.
(a)If the State Government requires the grant of any subsidy to any consumer or class of consumers in the tariff determined by the Commission, the State Government shall pay in advance the amount to compensate the licensee/person affected by the grant of subsidy in the following manner :(i)The State Government shall provide details of the category/class of consumers to whom it wants the licensee to charge subsidized tariff, 120 days before the start of a financial year.(ii)While determining the tariff for a distribution licensee under the applicable legal framework, the Commission shall separately take into account any subsidies, which the State Government has agreed to give to any category of consumers.(iii)The manner of payment of subsidy in advance, whether monthly or otherwise, along with the parameters of determination of such amount shall be specified by the Commission in the relevant order.(iv)The tariff determined by the Commission shall be published both with and without taking into account such subsidy offered by the State Government, along with such other conditions regarding applicability of subsidized tariffs to the affected consumers as may be specified in the Order.(v)In case of a failure of payment of subsidy to the requisite level by the Government, the tariffs determined by the Commission without accounting for the subsidy shall be applicable in the area of the licensee.(vi)The Distribution Licensee shall be under obligation to supply energy' to the subsidized categories only up to the time provided for in the order for calculating the amount of Government subsidy provision. Any significant deviation anticipated by the licensee in excess of the budgeted quantity for factors beyond its control should be brought to the notice of the Commission for its consideration.The licensee/person likely to be affected by charging a subsidized tariff shall, based on estimation and taking into account the tariff determined by the Commission for the said category' of consumers, calculate the approximate amounts for each quarter, viz. three month period, which would be adequate to compensate it for charging a subsidized tariff and convey the same to the State Government by November 15th of the year, with intimation to this Commission -(i)The State Government shall on receipt of the details of the amount from the licensee, inform the licensee by November 30 of each year, the quantum of subsidy which would be available for the next financial year.(ii)The licensee shall take the subsidy offered by the State Government into account while preparing and filing its Annual Revenue Requirements and Application for Tariff before the Commission.(iii)The State Government shall pay the assured amount of subsidy for each quarter, viz. three-month period in advance to the licensee/person likely to be affected,(iv)The licensee/person receiving the amounts from the State Government shall at the end of each quarter, calculate and ascertain the "actual amount" of subsidy payable by the State Government for supply of electricity at subsidized rates to any class/category of consumers in the said period and forward the details to the State Government, with intimation to this Commission.(v)The licensee/person shall thereafter make appropriate adjustments with regard to the "actual amount" received from the State Government in the beginning of the said quarter and depending on whether there is a deficit in the amount received or surplus amounts received, the licensee/person shall make appropriate adjustments in accordance with a true-up mechanism to be implemented at the end of each quarter
