APTEL stays MERC order allowing high end customers to shift to Tata Power in Mumbai

Next hearing slated for October 10 on an appeal by RInfra in this regard

The Appellate Tribunal for Electricity (Aptel) on Thursday stayed the Maharashtra Electricity Regulatory Commission (MERC)'s order to remove restrictions on consumers with monthly consumption of more than 300 units in Mumbai to shift to Tata Power. Aptel gave its order on an appeal filed by the Anil Ambani-owned Reliance Infrastructure (R-Infra), which had pleaded that MERC's order would have led to cherry-picking of high-end consumers (monthly consumption of 300-plus-units), leading to tariff burden on low-end consumers, mainly residential consumers. R-Infra said MERC's order would have prompted Tata Power to selectively lay its network, focusing on plush areas and not slums. Aptel said the next hearing will be on October 10. Tata Power said: "It is disappointing.... The choice of multiple distributors in Mumbai was to allow consumers the benefit of competitive services and prices available through different service providers. The order is awaited, and we will study it on receipt and then decide on the next course of action and be able to comment on other details thereafter."

MERC had put the restrictions on change-over and switch-over of customers of more than 300 units in August 22, 2012. However, in its recent order MERC lifted the restriction of change-over and switch-over. MERC on August 14 granted distribution licence to Tata Power up to August 2039, but said Tata will have to submit its network roll-out plan within six weeks.

Aptel has said in its interim order as network development was not found to be satisfactory, the state commission (MERC) was constrained to direct Tata Power to come with a roll-out plan for the proposed area of supply within six weeks. "When such a direction has been issued, the state commission ought to have waited till the roll-out plan was submitted before the state commission on the basis of which the state commission could have come to the conclusion with reference to the network developments. Unfortunately, this was not done," it said.

Aptel also pointed out that if limited stay was not granted, R-Infra would suffer a loss as there was a possibility of Tata Power connecting with the high-end consumers of R-Infra directly through its network.