Tata Power, RInfra cross swords again on Mumbai power supply

Tata today objected the tariff hike by RInfra in a letter sent to Maharashtra Electricity Regulatory Commission

Tata Power and Reliance Infrastructure (RInfra) are sparring over a multi-year rate proposal by the latter for its Mumbai power consumers. Competition between the two power distributors of Mumbai has intensifed since consumers in the city have been given the chance to choose their power supplier.

Objecting to the rate hike by RInfra, Tata today wrote to the Maharashtra Electricity Regulatory Commission (MERC), alleging over-inflating sales of consumers who change over. The company said RInfra’s rate was blocking customers from switching over and ‘maliciously’ preventing them from having a choice.

“We believe that the proposed rate by RInfra is anti-consumer and anti-competition, as it interferes with the customer’s right to switch over to a competitive tariff provider,” said Tata Power. After the state regulator empowered power consumers to choose their power distributor, many consumers (including many commercial establishments) shifted to Tata Power from RInfra. Last year, the regulator levied a cross-subsidy surcharge to balance out large customers.

Last month, RInfra proposed no tariff hikes for its Mumbai consumers for the next two years, as a part of its annual filing.

“The submission by RInfra lacks transparency as it appears that there is no tariff increase, whereas significant increase through wheeling and cross-subsidy charges are being pushed in to increase tariff through back door tactics. As per the Act and as per MERC’s old order, cross-subsidy charges were to be reduced to 20 per cent of opening charges, instead enhanced charges are being sought by RInfra,” said Tata Power.

RInfra said a public hearing on its proposed rate hike is underway. “Tata Power's objections on tariff are misleading and against the interest of smaller consumers of Mumbai. RInfra supplies 2.1 million smaller consumers, whereas Tata Power is cherry-picking only high-end consumers. MERC has already warned Tata Power from cherry-picking of high-end consumers," said a RInfra spokesperson.