Across tariff hike unjustified: MERC

The Maharashtra State Electricity Regulatory Commission (MERC) today rejected the 43 per cent rate hike proposed by the Maharashtra State Electricity Distribution Company Limited (MSEDCL).

The company also introduced differential tariff system, based on frequency and hours of load-shedding.

MERC stated in its order on the Annual Revenue Requirement (ARR) of MSEDCL that it will be unjustified to introduce an across tariff hike in the state, as rural areas which suffer from the more load-shedding don't benefit from the costly power purchase made by the MSEDCL.

The order observes, "The Commission has decided to treat power from costly sources and power from non-costly sources separately. For the purpose of this Order, the Commission has considered power costing more than Rs 4 per unit as costly power. If only non-costly power is allocated equally irrespective of categories or regions, the average load-shedding applicable across the state works out to 9 hours per day."

"However, as per the prescribed load-shedding protocol, agriculture-dominated regions are subjected to load-shedding of up to 12 hours owing to non-availability of power thereby reducing the load-shedding for non-agricultural consumers to 7.25 hours," the MERC order said.

So, if a particular area has four hours of load-shedding, it manages to do it through supply of expensive power.

And to continue to enjoy the lesser hours of load shedding, the consumers in this region will have to pay at higher rates for those extra 3.25 hours.

The commission has worked out the average price of costly power per unit at Rs 5.15 per unit at which the consumers from these areas will have to pay for 3.25 hours.

However, below poverty line (BPL) consumers and domestic consumers with the consumption of less than 300 units have been spared from paying these additional charges.