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Home News Power Sector News Maharshtra - Power tariff goes up 10%, another hike in offing

Maharshtra - Power tariff goes up 10%, another hike in offing

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MSEDCLThe power rates in Maharashtra have gone up by around 10% as Maharashtra Electricity Regulatory Commission (MERC) has given in to MSEDCL's demand of raising the fuel surcharge to recover Rs 1,483 crore revenue deficit. The surcharge will be applicable for the next six months. 

There is more agony in the offing for consumers, as MSEDCL has filed a power tariff petition for 2012-13, seeking a hike of over 17%. Now, since recovery of Rs 1,483 crore has already been allowed, the effective tariff hike sought will come down to around 14%.

For residential consumers the tariff will go up between 22 and 68 paise per unit while for commercial consumers it will be between 39 and 76 paise per unit. In industrial sector, the hike will be up to 49 paise per unit whereas for agriculture consumers it would be between 10 to 21 paise per unit, MSEDCL sources said.

If your monthly domestic consumption is 100 units, then your bill will increase by around Rs 25 after considering electricity duty. If the consumption is 200 units, the hike will be around Rs 70 as the surcharge for the slab 101-300 units is higher than the 0-100 units slab. For those consuming around 500 units per month the hike due to this surcharge will be over Rs 250.

The impact of this surcharge on industries will be devastating. The state already has one of the highest power tariffs in the country. With this surcharge and another power tariff hike in the offing, many industries will be forced to shut shop or shift to states like Chhattisgarh where industrial tariff is almost 50% of Maharashtra. Many steel and ferroalloys industries have already shifted to Chhattisgarh.

MSEDCL had demanded the hike in surcharge due to increase in prices of coal, oil and gas used in power generation over the last couple of years.

As per MERC norms, the power suppliers can collect fuel surcharge up to 10% over and above the tariff, but require MERC's permission beyond this. This MERC rule is mainly to avoid sudden tariff burden on consumers due to fuel price hikes.

However, as MSEDCL's deficit due to the 10% cap was increasing by the day and had reached Rs 1,483 crore it filed a petition seeking a special surcharge to recover the amount. It said that its dues to Mahagenco had increased to around Rs 3,500 crore, which had put the existence of the generating company had stake.

MSEDCL officials blamed MERC for the steep hike in tariff, claiming that the 10% cap caused the under recovery to accumulate to alarming levels. "Had the Commission removed the cap, the tariff would have gone up by 10 paise per unit some months ago. This would have prevented a tariff shock for consumers. The very philosophy behind 10% cap - to prevent a tariff shock - has now been defeated."

MERC had issued the order on Friday asking MSEDCL to recover Rs 247 crore every month in proportion to the existing slab wise power tariff. The company finalized the calculations on Monday.

Source- Times of India


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