Uttar Pradesh Electricity Rates to Rise as Power Corporation Imposes 10% Fuel Surcharge

Lucknow — Uttar Pradesh households and businesses face mounting costs as the state's power utility moves to levy a fuel surcharge on electricity consumption. With fuel prices for petrol, diesel, CNG, and PNG already climbing, residents will now contend with a 10% surcharge on their power bills.

The Uttar Pradesh Power Corporation Limited (UPPCL) has ordered implementation of the surcharge beginning with bills dispatched in June 2026. The corporation has also directed recovery of fuel charges from March 2026 through June billing cycles, with internal orders suggesting a potential 20% total surcharge—meaning an additional 10% may appear on July statements.

Mounting Financial Pressure

The decision compounds financial strain on consumers already grappling with inflation across essential services. The UPPCL's recovery mechanism bundles unpaid surcharges spanning the previous two years, according to state energy officials.

Regulatory Challenge Mounted

The State Electricity Consumer Council has mounted a formal challenge to the surcharge implementation. The council contends that distribution companies have artificially inflated the recovery amount by incorporating historical arrears into current charges.

The council has petitioned the Chief Minister for a formal inquiry and requested the Electricity Regulatory Commission to suspend the surcharge order pending investigation. An identical 10% fuel surcharge was levied on consumers in February 2026.

Dispute Over Power Procurement Costs

A central point of contention concerns how UPPCL calculates power acquisition expenses. The Electricity Regulatory Commission had sanctioned a power purchase rate of ₹4.94 per unit in its tariff determination. Yet UPPCL calculated March 2026 procurement costs at ₹5.86 per unit—a variance that the consumer council estimates imposes an additional ₹1,610 crore burden on state electricity users.

The council maintains that this cost discrepancy warrants comprehensive scrutiny before authorities implement further surcharges on consumers.