Section 142(1) in The U.P. Electricity Regulatory Commission (Conduct of Business) Regulations, 2004
(1)Unless otherwise agreed or prescribed by the Commission, Fuel Surcharge adjustment formula shall be in the following form :Ai=PPCi-1-OFi-1-EPRi-1+BiWhere Ai is the amount by which the licensee's revenues under the relevant tariff are to be increased or decreased during adjustment period (a negative number representing a reduction and a positive number representing an increase in revenues).PPCi-1 is the licensee's purchased power cost for the actual level of sales and the allowed level of loss in the most recent adjustment period ending before adjustment period i, calculated as,Pi-1 * Qi-1 * (1+L)Where, Pi-1 is the actual average cost of purchased power incurred by the licensee in the most recent adjustment period ending before adjustment period.QACTi-1 is the actual quantity of sales experienced by the licensee in the most recent adjustment period ending before adjustment period i,L is the average level of energy losses allowed by the Commission in the cost of service and reflected in the licensee's tariffs,OFi-1 are any purchased power costs actually incurred by the licensee in the most recent adjustment period ending before adjustment period i that are disallowed by the Commission as having been incurred in breach of its economic purchasing obligation.EPRi-1 is the aggregate amount of the charges that the licensee is deemed to have recovered from its tariffs in the adjustment period before adjustment period i, which is given by the formula,EPi-1* Qi-1* (1+L)Where, EPi-1 is the average charge for purchased power as determined by the Commission in the licensee's tariffs for the most recent adjustment period ending before adjustment period i,Qi-1 is the quantity of power deemed to have been sold by the licensee in the most recent adjustment period ending before adjustment period i, as determined by the Commission in the licensee's tariffs,Bi is a balancing factor reflecting the extent to which the licensee has under-' adjusted or over-adjusted its tariffs through previous fuel surcharge adjustments and is calculated as follows,Bi = Bi-1 + Ai-1 -Ri-1Where, Ri-1 is the total amount of fuel surcharges accruing due to the licensee from its sales to consumers in the adjustment period immediately preceding adjustment period.
