Industrialists in the state are completely dismayed by the decision of Maharashtra Electricity Regulatory Commission (MERC) to turn down applications of several industries seeking permission to buy power from Indian Electricity Exchange (IEX). It has refused to renew the open access (OA) permits of five industries. MERC has upheld the contention of MSEDCL that it will face operational and financial difficulties if industries were granted OA through IEX. These difficulties need to be addressed before OA can be allowed through exchanges. It claimed there was no specific provision in MERC OA Regulations to allow purchase of power through exchanges.
Twenty-nine industries had filed petitions in MERC either seeking OA or complaining about MSEDCL's unwillingness to grant the same. All of them have been rejected.
The industrial power tariff of MSEDCL is one of the highest in the country. The industries find buying power from exchanges cheaper. MSEDCL contends that if subsidizing consumers start buying power from elsewhere, then the entire tariff structure will collapse and it will be forced to increased the tariff of common consumers.
MSEDCL officials have been unofficially telling the media that soon after parliamentary elections several states will go in for sharp revision of power tariff as their discoms are in very bad shape. They claim that their power tariff will come at par with other states after this revision.
However, MERC's authorized consumer representative RB Goenka said MERC was ignoring Electricity Act while turning down the OA applications. "As per the act, MERC does not have the right to decide tariff of industries having load of over 1MW. This rule has not been implemented but at least it should allow open access at par with other states," he said.
Goenka and other consumer activists have been claiming that the tariff is high because of inefficiency and corruption in MSEDCL, and the only way to reduce power tariff was to check malpractices.
"I have submitted evidence of artificial reduction of distribution losses to MERC, but no action has been taken so far. MSEDCL had demanded another tariff hike but this was prevented using government subsidy. The subsidy will be withdrawn soon after assembly elections, and the tariff will shoot up by another 20%," consumer activist Ashish Chandarana said.
Power sector activists say MERC has become gradually soft towards state-run power companies. Chairman Pramod Deo frequently took MSEDCL to task. VP Raja too sometimes cracked down on MSEDCL, but current chairperson Chandra Iyengar agrees with whatever MSEDCL says, making many wonder whether the regulatory process exists in the state or not.