Power tariff sop for backward parts of Maharashtra

Investments in Vidarbha, Marathwada, north Maharashtra and backward parts of western Maharashtra will receive a concession in power tariffs.

The state government has made a budgetary allocation of Rs 1,011 crore to compensate for losses of the state-run MahaVitaran. The power tariff will be reduced by offering a load factor incentive and lower fuel adjustment cost.

The tariff will be reduced to Rs 1.75 per unit in Vidarbha, Rs 1.50 in Marathwada, and Rs 1 in north Maharashtra and backward areas of western Maharashtra. A decision on this was taken by a Cabinet sub-committee chaired by Energy Minister Chandrashekhar Bawankule. It will be effective from April 1, 2016, till March 31, 2019.

The committee refrained from recommending a fixed tariff of Rs 4.25-4.50 per unit for certain categories of investors. The government’s move is aimed at dispersal of industrial investment and to curb migration of industrial consumers to other states due to high power tariff. The state industries department had made a case for reducing the industrial power tariff, which ranges between Rs 8.23 and Rs 13 per unit.

The department pointed out it was quite higher than Karnataka (Rs 6.80), Gujarat (Rs 6), Goa (Rs 4.80) and Madhya Pradesh (Rs 6.70). The state government has also decided to impose a duty on open access transactions because industrial consumers are drawing power this way citing higher tariff.