Maharasthra Govt Agrees to 20% Subsidy on Power Bills

Monday, 03 March 2014 21:57 Lathish PV

MERCEven as state power regulator has allowed Mahavitaran to recover Rs 5,022-crore worth revenue shortfall from consumers from March 1, the utility has decided against burdening the public after the poll-bound Prithviraj Chavan government agreed to give it 20 per cent subsidy.

"As promised earlier, there will not be any burden on consumers because of the hike," Mahavitaran said in a statement.

This does not mean that tariffs will come down but they will not go up either.

The state will be providing subsidy to the extent of over Rs 606 crore per month or Rs 7,272 crore to reduce power tariffs by around 20 per cent, the utility said.

The state government in January announced a 20 per cent discount for power consumers in Maharashtra except Mumbai, but did not issue a notification in this regard so far.

The move came following protests by state leaders to slash power charges following 50 per cent cut effected by erstwhile Arvind Kejriwal government in New Delhi.

As per the Maharashtra Electricity Regulatory Commission (Merc) order, the regulator has approved an average increase of 17 per cent in tariffs for FY12 and FY13 so that the discom could recover the dues.

The state electricity distributor had approached the Merc seeking recovery of shortfall in its revenues for the two years which occurred due to abnormal change in sales mix that impacted Mahavitaran's cash flow during the period.

The Merc had allowed recovery of Rs 418.51 crore per month from consumers across all categories.

The shortfall includes Rs 4,000 crore against revenue and Rs 1,022 crore against carrying cost.

Meanwhile, Merc has directed Mahavitaran to submit a roadmap to bill unmetered agriculture pumps and also to undertake detailed study of division wise losses.

"Prepare a milestone-based action plan for reducing the losses in all divisions where the losses are higher than 20 per cent. This shall be submitted to the commission within 60 days from the date of this order. It has to also submit a detailed explanation for increase in operation and maintenance expenses in FY12 and FY13 within 15," the order said.

Source - Outlook