FPPAS, FPPCA and PPAC fuel surcharge on electricity bills explained

The fuel and power purchase adjustment surcharge — FPPAS, also called FPPCA, FAC or, in Delhi, PPAC — is a monthly add-on that lets your DISCOM recover changes in the cost of buying power after the SERC has fixed the tariff. The SERC sets the base energy charge on an assumed power purchase cost; when coal, gas or market power costs more than assumed, the difference is passed through as a percentage of your charges or as paise per unit, by a formula the SERC has approved. It is not a penalty or a tax, and it can be zero or even negative in some months. What you can check is whether the rate applied matches the rate your DISCOM published for that billing month.

Part of how electricity tariffs are set in India.

Why the surcharge exists

A tariff order is based on projections made months in advance. Power purchase is usually the largest part of a DISCOM's cost, and it moves with fuel prices, imported coal blending, hydro availability and prices on power exchanges. Without a pass-through, DISCOMs would build up unrecovered costs ("regulatory assets") that consumers end up paying later with carrying cost. The Ministry of Power's Electricity (Amendment) Rules, 2022 required SERCs to provide a formula for automatic monthly pass-through of fuel and power purchase cost changes, so that the surcharge is levied promptly instead of years later. SERCs then wrote that formula into their own tariff regulations, often with a ceiling on what can be charged automatically; anything above the ceiling needs the SERC's approval.

How it shows on a bill

The base the percentage is applied to matters. A 10% surcharge on energy charges alone is smaller than 10% on energy plus fixed charges.

A real example: Delhi, mid-2026

In Delhi the normal ceiling for the surcharge each billing cycle under DERC's regulations is reported as 10%. DISCOMs can ask DERC to allow more when costs rise sharply. By an order dated 10 August 2026, DERC allowed higher recovery for June 2026 for one month, as reported by the trade press:

The difference between what the DISCOM computed and what it was allowed to recover is carried forward for later recovery or true-up. We took these figures from a news report of the order, not from the order itself; check the DERC website for the authoritative text.

What that means in rupees (illustrative). A Delhi household with ₹1,275 energy charge and ₹150 fixed charge (350 units, 3 kW) pays a base of ₹1,425. At 17.94%:

1,425 × 17.94% = ₹256

That is about the same as the energy charge for 57 more units at ₹4.50. The surcharge is calculated before the state subsidy is applied; how the subsidy treats it depends on the scheme's rules, so look at whether your bill shows the surcharge inside or outside the subsidised amount.

How to check the surcharge on your bill

1. Find the billing month. Surcharges are usually linked to the cost of an earlier month, then applied to bills issued in a later month.
2. Find the published rate. DISCOMs publish the surcharge on their website, often under "tariff", "FPPAS" or "PPAC". SERCs publish orders allowing anything above the ceiling.
3. Check the base. Note whether it is applied to energy charges, energy plus fixed charges, or per unit.
4. Recalculate. Base × rate. Small rounding differences are normal; anything larger is worth a written query.
5. Look for double charges. If two surcharge lines appear for the same period, ask the DISCOM to explain each one.

Surcharge versus regulatory surcharge

Can you avoid it?

Not directly; it applies to all consumers in the category. You can reduce its rupee impact by reducing units (which shrinks the base), by not keeping a higher sanctioned load than you need when the surcharge applies to fixed charges, and, where available, by moving use into solar hours under a time-of-day tariff. Rooftop solar under net metering reduces the units you are billed for; see PM Surya Ghar and net metering.

If you believe the surcharge was applied wrongly, use the order in how to complain to the CGRF and Ombudsman. Consumer groups can also object to large surcharge claims when the SERC invites comments.

See also: surcharge names state by state and duty and other surcharges.

Frequently asked questions

Why is my surcharge different from my neighbour's in another area of the city?

Cities like Delhi and Mumbai have more than one DISCOM. Each has its own power purchase portfolio and surcharge rate. Two homes on either side of a DISCOM boundary can see different percentages in the same month.

Is the surcharge refunded if costs fall later?

The formula is trued up against actual costs. If a DISCOM over-recovered, the difference is adjusted in later surcharges or in the next tariff determination. Individual refunds on a bill are uncommon.

Does the free-power subsidy cover the surcharge?

It depends on the scheme. Some schemes subsidise the whole bill up to a consumption limit; others subsidise only energy charges. Check how your bill shows the subsidy credit against each line.

Where are surcharge rates published?

On your DISCOM's website and, for approvals above the automatic ceiling, on the SERC's website as orders. Ask your DISCOM's call centre or 1912 for the rate applied in your billing month if you cannot find it.

Sources and where to check

• Delhi Electricity Regulatory Commission — PPAC and FPPAS orders for Delhi DISCOMs
• Maharashtra Electricity Regulatory Commission — FAC orders and tariff pages
• Ministry of Power — Electricity (Amendment) Rules, 2022 on automatic pass-through
• Central Electricity Regulatory Commission — power market and generation tariff context