TP Odisha Explains Additional Security Deposit on Power Bills
ASD is mandatory under law, linked to usage and refunded with interest, say DISCOMs
Bhubaneswar: The Tata Power–run Odisha electricity distribution companies (TP Odisha DISCOMs) have clarified that the levy of Additional Security Deposit (ASD) on electricity bills is a legal and regulatory requirement. The companies said the provision is mandated under the Electricity Act, 2003 and governed by regulations of the Odisha Electricity Regulatory Commission (OERC).
The clarification comes amid consumer queries over ASD charges appearing in electricity bills.
Security Deposit (SD) and Additional Security Deposit (ASD) are calculated based on a consumer’s electricity usage pattern and the applicable tariff. The purpose of these deposits is to ensure adequate security coverage for electricity supplied, as required under regulatory norms.
TP Odisha DISCOMs explained that the annual review of security deposits is a routine statutory process. It is neither a new practice nor a discretionary decision by the distribution companies.
Consumers whose electricity consumption has reduced during the last financial year are eligible for an adjustment of excess Security Deposit. This adjusted amount is credited in their electricity bills.
On the other hand, consumers whose electricity usage has increased are required to pay an Additional Security Deposit. This ensures that the security amount remains proportionate to their higher consumption, as per OERC regulations.
Interest Paid on Security Deposits
Consumers continue to earn interest on their Security Deposits every year. The interest amount is credited directly to electricity bills, in line with regulatory provisions.
During the financial year 2024–25, TP Odisha DISCOMs credited ₹217.29 crore as interest on Security Deposits to consumer bills across the state. The interest was calculated at a rate of 6.50 per cent.
Consumer Funds Are Fully Protected
The DISCOMs clarified that all amounts collected towards Security Deposit and Additional Security Deposit are kept securely as Fixed Deposits with scheduled banks. These funds are not used for daily operations or any other purposes.
This system ensures that consumer money remains protected at all times and is available for refund when required.
Refund Policy and Prepaid Power Option
Security Deposits, along with the applicable interest, are fully refundable when a consumer surrenders or disconnects the electricity connection.
In addition, TP Odisha DISCOMs offer the option of prepaid electricity connections. Consumers choosing prepaid power do not need to pay any Security Deposit or Additional Security Deposit, giving them greater flexibility and control over their electricity expenses.
Long-Standing and Uniform Practice
The framework for Security Deposit and ASD has been in place for several decades in Odisha. It was followed even during the period of earlier power utilities such as CESU, NESCO, SOUTHCO, and WESCO.
Officials said the regulations in Odisha are fully aligned with the Electricity Act, 2003 and are similar to practices followed by electricity distribution companies across other states. The system is designed to maintain financial discipline, protect consumer interests, and ensure the stability of the power distribution sector.
Penalty for Late Payment
Consumers who receive a notice for Additional Security Deposit are required to pay the amount within the specified time. As per statutory rules, a surcharge of 15 per cent per annum is applicable on unpaid amounts beyond the due date.
Gajanan Kale, Chief of Odisha Distribution Business at Tata Power, said the company serves nearly one crore consumers in the state and follows strict regulatory guidelines to ensure reliable power supply throughout the year.
He said the annual review of Security Deposits is mandated by the regulator and is aimed at protecting consumer interests while ensuring uninterrupted electricity supply. He added that the 6.50 per cent annual interest earned on Security Deposits is adjusted in consumer bills, and any excess deposit due to lower consumption is also returned through bill adjustments.
According to him, all deposits are maintained as Fixed Deposits and are never used for operational expenses.
Ensuring Transparency and Reliability
TP Odisha DISCOMs reiterated their commitment to transparency, consumer protection, and uninterrupted power supply. They urged consumers to understand the statutory nature of Security Deposit and ASD and to use available options like prepaid connections for greater convenience.
