Industry urges KERC to reject power tariff hike proposal

Industrialists of Mysore have urged the Karnataka Electricity Regulatory Commission (KERC) to reject the proposal of the Chamundeswari Electricity Supply Corporation Ltd. (CESC) to increase power tariff by 88 paise per unit for year 2012.

Presenting arguments before the KERC in Mysore on September 14, Laghu Udyog Bharathi Karnataka Vice-President and Karnataka Small Scale Industries Association (Kassia) Mysore Zonal Chairman Suresh Kumar Jain took objection on issues like CESC not submitting its tariff revision application in Kannada, failure to submit audited and certified balance sheet, and failure to comply with KERC’s directions.

“If the tariff proposal is allowed to pass, it would cause irreparable losses to industrial consumers, whose consumption is declining steadily due to higher cost and non-availability of quality power. It is estimated about 3,000 MU are generated by captive generation and it is likely industrial consumers will further move away from the grid,” he cautioned.

Jain cited KASSIA’s earlier submission that industrial consumption in respect of HT-2(a) had steadily declined from a peak of 4,706 MU (44.65% of total sales) in 1992 to 3,494 MU (20% of total sales) in 2009-10. “The percentage of HT consumers, though only 0.02, they are giving 25 per cent revenue to ESCOMS. Unscheduled load shedding and frequent interruptions have caused unbearable loss to industries in the State. Many of them have shut shops due to unreliable power supply,” he argued.

Foundries, forging shops, heat treatment shops, electroplating, powder coating, blow moulding units and steel mills in Karnataka, which are highly energy consuming, were under serious threat of closure due to high power cost. This had made manufacturing activity very prohibitive due to competition from neighbouring States. Instead of a rise, a substantial reduction in tariff is required to ensure survival of these and other industries in the State.

CESC had proposed a flat hike of 88 paise for all categories. This was unjustified at least in case of SSIs (LT 5 and HT 1 categories). Load shedding and unscheduled interruptions resulting in loss of man hours and loss of production threatened very survival of SSIs. Therefore, the present tariff may be brought down for SSIs, he said supporting KASSIA’s plea for three slab rates, between 0 to 1,000 units, 1001 to 2,000 units and above 2001 units under rate schedule for LT 5 category.

Jain reiterated KASSIA’s request to KERC to direct CESC to reduce tariff for industries working between 10 p.m and 6 a.m, without binding them to pay higher rates for working between 6 p.m and 10 a.m.

Citing discrepancies in the CESC application, he said there was huge difference in distribution costs among ESCOMs and surprisingly all of them were proposing a uniform hike despite varying customer profiles, varying distribution losses and other general cost. This led to suspect the authenticity of its figures supporting the rise.

Industrialists and other category consumers also presented their arguments before the KERC sitting held under chairmanship of M.R.Srinivasa Murthy.