Maharashtra regulator okays only moderate rises till FY20

Introduces voltage based differential tariffs for high tension consumers

Over 25 million consumers of the state-run Maharashtra Electricity Distribution Company (MahaVitaran) have received a relief in electricity tariff to be applicable from November 1.

The Maharashtra Electricity Regulatory Commission (MERC) has rejected the state-run MahaVitaran's proposal for an average 5.5 per cent increase in the electricity rate for 2016-17. Instead, it has allowed a moderate rise of one to three per cent for residential consumers for the current year and also for 2017-18, 2018-19 and 2019-20.

The Below Poverty Line residential rate category has been extended to consumers with a sanctioned load up to 0.25 Kw, against the limit of 0.1 Kw earlier. For low tension (LT), the rate per unit has been raised to Rs 6.41, from Rs 6.33; for LT non- residential to Rs 11.23, from Rs 11.19; for LT power looms to Rs 6.57, from Rs 6.54; for LT industry-general to Rs 8.03, from Rs 7.99.

MERC expects the overall average billing rate (ABR) for high tension (HT) consumers and LT industry to increase only marginally by 0.4-0.5 per cent for 2016-17, and also for 2017-18, 2018-19 and 2019-20. It has approved an increase in demand charges/fixed charges of around seven per cent annually for FY17 and FY18, and eight per cent annually for FY19 to FY20. For HT industry, the revision is to Rs 8.56 for 2016-17 from the existing Rs 8.52, for HT commercial to Rs 13.13 from Rs 12.97, for HT agriculture pumps to Rs 3.99 from Rs 3.85.

HT consumers have been further classified based on voltage levels, such as EHV (66 Kv and above), 33 Kv and 22 Kv and 11 Kv.

The industries department and business chambers had complained of rates being too high as compared with other states, such as Karnataka (Rs 6.80), Gujarat (Rs 6), Goa (Rs 4.80) and Madhya Pradesh (Rs 6.70).

The government made a budgetary allocation of Rs 1,011 crore to provide a subsidy to MahaVitaran to compensate its loss. reduction in rates will be done by offering a load factor incentive and cut in the fuel adjustment cost.

The rate for the agriculture category has increased slightly but will still meet only a little above half of the average cost of supply. However, around a third of agri consumers are still un-metered. To promote metering, the rate for un-metered agricultural pumpsets, particularly those with connected load above 7.5 HP, has been increased, so that it is significantly higher than for farmers with metered connections.

Against the total revenue gap of Rs 56,372 crore estimated by MahaVitaran for the current year to 2019-20, which is 19 per cent of its total projected average revenue requirement for that period, MERC has determined a much lower total revenue gap of Rs 9,149 crore.