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Home News Power Sector News Maharashtra - High tariffs cause industrial consumers to shift power loyalty

Maharashtra - High tariffs cause industrial consumers to shift power loyalty

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MaharashtraMaharashtra, which has said it will go all out to encourage private businesses in the state, has lost 500 big and small industrial consumers to high power tariffs over the past few years. The figures were released in a report submitted by the Maharashtra State Electricity Distribution Company Limited (MahaDiscom) to the Maharashtra Electricity Regulatory Commission (MERC) this week.

The report proposes from 19 per cent to 27 per cent increases in power tariff for industrial, residential, farming consumers in the next four years, ending 2019-2020.

An independent analysis of the proposal shows that consumers such as Raymonds, Bharat Forge and the Railways have, along with 500 industrial users, shifted to an 'open grid' access beginning 2012. Such a grid allows consumers with a large use of power — 1 megawatt (1 MW) and above — to buy cheaper power from other companies or suppliers in the market. This came after the Central government amended the Electricity Act, 2003 to allow a smooth transition for industrial users.

Major players in the open grid are Mittal Processor Limited, Global Energy Private Limited and Adani Enterprises Limited. Companies like CEAT, Mahindra, Garware and Jindal Polyfilms have moved to Adani. Other like Tata Motors, Essar Steel, Godrej and Kirloskar have moved to Global Energy.

"The shift has taken place over the years since the tariff of MahaDiscom has been too high as compared to other private companies," said activist Pratap Hogade, convenor of Veej Grahak Sanghatana, which has done an independent analysis of the industrial consumer exodus. "Most consumers have therefore opted for an open grid access since 2012. The state sells power at Rs. 8 per unit whereas in the open access, the tariff ranges from Rs. 5.5 to Rs. 6 per unit." Of the total 1,800 consumers who use 1 MW, the study finds that 500 have already left MahaDiscom, most of these in the past two years.

Source- Hindu

 

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