Indian Railways facing high electricity prices after Supreme Court Last week ruled that the National Transporter qualifies as a “consumer” under the Electricity Act. As a result, Railways will remain liable to pay Cross-Subsidy Surcharge (CSS) and additional surcharge while purchasing power through open access for their own consumption, thereby impacting the operating ratio of the Railways.Due to this, the power purchase expenditure of Railways is likely to increase. It had argued that the Railways should not be treated as a traditional consumer as it distributes power across its vast operational network. However, the SC rejected this argument and clarified that the Railways purchases power through open access “exclusively for self-consumption”, and hence, falls under the definition of consumer under the Electricity Act, 2003.The order passed by a two-judge bench of Justices Dipankar Datta and Satish Chandra Sharma said, “For the reasons stated hereinabove, it is clear that the appellant does not pass muster as a deemed distribution licensee under the (Indian Railways) Act, and he cannot under any circumstances avoid payment of cross-subsidy surcharge and additional surcharge as a consumer of electricity through open access.”The court directed the state power distribution companies to calculate the outstanding CSS and additional surcharge payable by the appellant and issue a detailed statement. It states that the calculation should clearly specify the amount based on the area of ​​supply and the period during which open access was used. “The appellant shall be given reasonable opportunity and time to respond to the said counts,” it said.The controversy arose when the Railways sought to purchase 100 MW of power through inter-state open access for its traction substations in Maharashtra. The Maharashtra State Electricity Transmission Company refused connectivity, leading the Railways to seek a declaration from the Central Electricity Regulatory Commission (CERC) that it is a deemed distribution licensee (DDL) exempt from surcharge.The CERC ruled in favor of the railways in 2015, but it was challenged by several state electricity regulatory commissions (SERCs) and discoms. The Appellate Tribunal for Electricity (APTEL) in its final judgment dated February 12, 2024, set aside the CERC order saying that Railways is a consumer and not DDL.Railways challenged these orders in SC.