 "MahaVitaran proposes 5.5% tariff hike across its 25 mn consumers for 2016-17")
The state-run Maharashtra State Electricity Distribution Company (MahaVitaran) has proposed an average tariff hike of 5.5% for 2016-17 across its 25 million consumers. In its petition before the Maharashtra Electricity Regulatory Commission MERC), it has argued that the rise in tariff is necessary to meet the revenue gap of Rs 38,987 crore and also to meet the inflation ranging between 5% and 8% in the country.
MahaVitaran, whose total arrears from various consumer categories have crossed Rs 20,000 crore as on date, has submitted that it was finding it extremely difficult to sustain its operations at the present tariff levels because of intrinsic rise in expenditure. This rise is owing to inflationary pressures, and consistent rise in cost of power and energy demands and obligations that need to be met under the policy objectives of the state and central governments. This is especially after MERC last year ordered 5.75% tariff cut against MahaVitaran's proposal of 7.94% tariff hike for 2015-16.
According to the state distribution utility, the tariff hike is essential to meet its bare minimum requirement to remain financially viable and to meet the financial obligation to discharge the liabilities. Besides, it is to tackle the cost escalation, which is 8% in last five years. MERC's technical validation committee comprising representatives of industry and consumer organisations has held its first meeting on March 21 to discuss MahaVitaran's tariff hike proposal and it will be taken up for further analysis.
For the consumers with 0-30 units, the MahaVitaran has proposed tariff at 92 paise from the present tariff of 87 paise per unit, for 0-100 units Rs 3.97 from Rs 3.76, for 101-300 units Rs 7.61 from Rs 7.21, for 301-500 units Rs 10.50 from Rs 9.95, for 500-1000 units Rs 11.93 from Rs 11.31 and above 1,000 units Rs 13.19 from Rs 12.50. For the agricultural pump, the tariff is proposed at Rs 3.50 as against Rs 3.32 per unit. There are in all 3.6 million agricultural pump sets of which 1.6 million are metered.
For the high tension industrial consumers on continuous express feeders the tariff is proposed at Rs 7.61 against the present tariff of Rs 7.21 per unit, for non continuous non express feeders Rs 7.08 against Rs 6.71 and for seasonal category Rs 8.23 against Rs 7.80. Further, for the high tension commercial on express feeder the tariff is proposed at Rs 11.76 against Rs 11.15 per unit and for non express feeder consumers Rs 11.20 against Rs 10.62 per unit. For the Mumbai mono rail and metro, MahaVitaran has proposed tariff of Rs 8.93 against Rs 8.46 per unit.
MahaVitaran's proposal on tariff increase especially for industrial consumers come at a time when the state industries department has made a strong case for reduction compared with other competing states. The state industries department headed by Shiv Sena leader Subhash Desai has brought to the chief ministers Devendra Fadnavis' notice that the effective industrial tariff is 16-38% higher compared to other states. The effective tariff increase effective from June 1 last year has been more than 9% considering changes in energy charge, maximum demand charge, tax on sale.
An industries department official, who did not want to be named, told Business Standard,'' Further rise in tariff will adversely impact the government's Make In Maharashtra as industrial consumers may opt for power purchase through open access.''
State energy minister Chandrashekhar Bawankule last week told the state assembly that the government may provide Rs 1,000 crore for rebate in tariff charged to industrial consumers.
