Consider the following statements regarding the "Cross-Subsidy Surcharge":
1. It is payable by consumers who opt for open access.
2. It is intended to compensate the distribution licensee for the loss of cross-subsidy.
3. The State Commission has no power to reduce or eliminate this surchargeWhich of the statements given above is/are correct?
Answer & step-by-step solution
State Commissions have a central role in introducing and regulating distribution-level open access and associated charges. Cross-subsidy surcharge compensates the incumbent distribution licensee for loss of cross-subsidy and is determined/reduced under the regulatory framework. Key relation: Open access charges may include transmission/wheeling, cross-subsidy and other applicable charges.
Exam focus: Open access is not limited to a Central Transmission Utility. Common trap: The State Commission does have regulatory authority over surcharge treatment.
Statement-wise Verification
- Statement 1 - Correct.
It is payable by consumers who opt for open access.
Open access is not limited to a Central Transmission Utility. - Statement 2 - Correct.
It is intended to compensate the distribution licensee for the loss of cross-subsidy.
Cross-subsidy surcharge compensates the incumbent distribution licensee for loss of cross-subsidy and is determined/reduced under the regulatory framework. - Statement 3 - Incorrect.
The State Commission has no power to reduce or eliminate this surcharge
The surcharge is determined within the statutory/regulatory framework and is subject to Commission-specified treatment/reduction; the Commission is not powerless
Core Concept
The Electricity Act defines open access as non-discriminatory use of transmission lines or distribution systems by eligible users in accordance with regulations. State Commissions have a central role in introducing and regulating distribution-level open access and associated charges. Cross-subsidy surcharge compensates the incumbent distribution licensee for loss of cross-subsidy and is determined/reduced under the regulatory framework.
Formula / Key Relationship
Open access charges may include transmission/wheeling, cross-subsidy and other applicable charges.
Why the Other Options Are Wrong
Option A is incorrect because it includes incorrect statement(s) 3 and omits correct statement(s) 1. Option C is incorrect because it omits correct statement(s) 2. Option D is incorrect because it includes incorrect statement(s) 3.
Exam Shortcut / Approach
Open access is not limited to a Central Transmission Utility.
Common Mistake
The State Commission does have regulatory authority over surcharge treatment.
Quick Revision
Purpose and Regulatory Control is linked with Cross-Subsidy Surcharge, Open Access Charges and Electricity Law and Regulation. Open access is not limited to a Central Transmission Utility.
"क्रॉस-सब्सिडी सरचार्ज" (Cross-Subsidy Surcharge) के संबंध में निम्नलिखित कथनों पर विचार कीजिए:
1. यह ओपन एक्सेस चुनने वाले उपभोक्ताओं द्वारा देय है।
2. इसका उद्देश्य क्रॉस-सब्सिडी की हानि के लिए वितरण लाइसेंसधारी की क्षतिपूर्ति करना है।
3. राज्य आयोग को इस सरचार्ज को कम करने या समाप्त करने का कोई अधिकार नहीं है।
ऊपर दिए गए कथनों में से कौन-सा/से सही है/हैं?
उत्तर और चरणबद्ध हल
B — केवल 1 और 2। क्रॉस-सब्सिडी सरचार्ज ओपन एक्सेस उपभोक्ता देते हैं और यह वितरण लाइसेंसधारी की क्रॉस-सब्सिडी हानि की भरपाई करता है। राज्य आयोग के पास इसे नियामक ढाँचे के तहत घटाने/निर्धारित करने का अधिकार है, इसलिए कथन 3 गलत है।
विस्तृत हल (मूल भाषा में)
Statement-wise Verification
- Statement 1 - Correct.
It is payable by consumers who opt for open access.
Open access is not limited to a Central Transmission Utility. - Statement 2 - Correct.
It is intended to compensate the distribution licensee for the loss of cross-subsidy.
Cross-subsidy surcharge compensates the incumbent distribution licensee for loss of cross-subsidy and is determined/reduced under the regulatory framework. - Statement 3 - Incorrect.
The State Commission has no power to reduce or eliminate this surcharge
The surcharge is determined within the statutory/regulatory framework and is subject to Commission-specified treatment/reduction; the Commission is not powerless
Core Concept
The Electricity Act defines open access as non-discriminatory use of transmission lines or distribution systems by eligible users in accordance with regulations. State Commissions have a central role in introducing and regulating distribution-level open access and associated charges. Cross-subsidy surcharge compensates the incumbent distribution licensee for loss of cross-subsidy and is determined/reduced under the regulatory framework.
Formula / Key Relationship
Open access charges may include transmission/wheeling, cross-subsidy and other applicable charges.
Why the Other Options Are Wrong
Option A is incorrect because it includes incorrect statement(s) 3 and omits correct statement(s) 1. Option C is incorrect because it omits correct statement(s) 2. Option D is incorrect because it includes incorrect statement(s) 3.
Exam Shortcut / Approach
Open access is not limited to a Central Transmission Utility.
Common Mistake
The State Commission does have regulatory authority over surcharge treatment.
Quick Revision
Purpose and Regulatory Control is linked with Cross-Subsidy Surcharge, Open Access Charges and Electricity Law and Regulation. Open access is not limited to a Central Transmission Utility.
"ક્રોસ-સબસિડી સરચાર્જ" (Cross-Subsidy Surcharge) અંગે નીચેનાં વિધાનો ધ્યાનમાં લો:
1. તે ઓપન એક્સેસ પસંદ કરનાર ગ્રાહકો દ્વારા ચૂકવવાપાત્ર છે.
2. તેનો હેતુ ક્રોસ-સબસિડીના નુકસાન માટે વિતરણ લાઇસન્સધારકને વળતર આપવાનો છે.
3. રાજ્ય પંચને આ સરચાર્જ ઘટાડવાની કે રદ કરવાની કોઈ સત્તા નથી.
ઉપર આપેલાં વિધાનોમાંથી કયું/કયાં સાચું/સાચાં છે?
જવાબ અને પગલાવાર ઉકેલ
B — ફક્ત 1 અને 2. ક્રોસ-સબસિડી સરચાર્જ ઓપન એક્સેસ ગ્રાહકો ચૂકવે છે અને તે વિતરણ લાઇસન્સધારકના ક્રોસ-સબસિડી નુકસાનની ભરપાઈ કરે છે. રાજ્ય પંચ પાસે નિયમનકારી માળખા હેઠળ તેને ઘટાડવા/નક્કી કરવાની સત્તા છે, તેથી વિધાન 3 ખોટું છે.
વિગતવાર ઉકેલ (મૂળ ભાષામાં)
Statement-wise Verification
- Statement 1 - Correct.
It is payable by consumers who opt for open access.
Open access is not limited to a Central Transmission Utility. - Statement 2 - Correct.
It is intended to compensate the distribution licensee for the loss of cross-subsidy.
Cross-subsidy surcharge compensates the incumbent distribution licensee for loss of cross-subsidy and is determined/reduced under the regulatory framework. - Statement 3 - Incorrect.
The State Commission has no power to reduce or eliminate this surcharge
The surcharge is determined within the statutory/regulatory framework and is subject to Commission-specified treatment/reduction; the Commission is not powerless
Core Concept
The Electricity Act defines open access as non-discriminatory use of transmission lines or distribution systems by eligible users in accordance with regulations. State Commissions have a central role in introducing and regulating distribution-level open access and associated charges. Cross-subsidy surcharge compensates the incumbent distribution licensee for loss of cross-subsidy and is determined/reduced under the regulatory framework.
Formula / Key Relationship
Open access charges may include transmission/wheeling, cross-subsidy and other applicable charges.
Why the Other Options Are Wrong
Option A is incorrect because it includes incorrect statement(s) 3 and omits correct statement(s) 1. Option C is incorrect because it omits correct statement(s) 2. Option D is incorrect because it includes incorrect statement(s) 3.
Exam Shortcut / Approach
Open access is not limited to a Central Transmission Utility.
Common Mistake
The State Commission does have regulatory authority over surcharge treatment.
Quick Revision
Purpose and Regulatory Control is linked with Cross-Subsidy Surcharge, Open Access Charges and Electricity Law and Regulation. Open access is not limited to a Central Transmission Utility.
More Electricity Act & Regulation questions