State to direct MERC to stay Reliance tariff hike

State Energy Minister Chandrashekhar Bawankale told mid day that they will instruct the state energy regulator to stop Reliance from increasing their charges for migrated consumers and instead recover the amount over 10 years

The state government will invoke a provision from the Electricity Act, 2003, to tell the Maharashtra Electricity Regulatory Commission (MERC) to stay any tariff hike awarded to Reliance Energy. The city’s suburban power utility had asked the MERC for a hefty hike, in a petition which was heard last Monday.

File pic for Representation
File pic for Representation

Energy minister Chandrashekhar Bawankule told mid-day yesterday that the government was opposed to Reliance’s move of burdening consumers further by hiking wheeling charges (for migrated consumers) by a whopping 120 per cent. These are consumers who have switched from Reliance to Tata as their power provider.

The company has asked for 35 per cent more in energy charges from residential consumers using 301-500 units by 35 per cent, and 26 per cent more from the consumers in the 501 and above units slab. Consumers using less than 300 units have been spared, though, as their tariff is proposed to be dropped by nine per cent.

Avoiding shock
Reliance has 29 lakh consumers from Bandra up to Mira-Bhayander in the north and from Kurla up to Ghatkopar in the east. Of these, around 20 lakh consumers are residential users. Tata Power is another provider, but it largely uses Reliance’s cables to supply power to consumers who earlier sought supply from Reliance.

These migrated consumers pay a wheeling charge (rental for using the Reliance network for carrying Tata’s electricity). Reliance has proposed that this charge be increased from Rs 1.24 per KWh (kilowatt-hour) to Rs 2.73 per KWh. “If approved, the new tariff and wheeling charges will burden the distressed consumers further. We will use our discretion under the Electricity Act, 2003 to stop this.

The government will direct that these charges be recovered over the next 10 years, and not in one year, so that the consumers are spared from a tariff shock,” the minister told this paper, after a debate on the state’s power issue in the ongoing budget session of the legislature.

Bawankule said he was aware of the concerns raised by the consumers. The consumer representatives who attended the public hearing on Monday had complained that they were not allowed to speak for more than 10 minutes, and the hearing was held at a place in south Mumbai where they could not reach in time. Some MLAs from Mumbai also raised similar concerns in the house (‘People get 10 minutes each to voice their problems on power tariff hike’, March 17).

In 2009, the then government had invoked a special provision in the Electricity Act in a span of two months to stay MERC’s tariff order in a Reliance petition that had decreased tariff for builders, malls and multiplexes in the state while increasing bills of domestic consumers and public water works users by an average four per cent.

Bawankule said it was unfair on the part of Reliance to charge more when other three distribution utilities — Tata (island city and suburbs), BEST (island city) and the state-run MahaVitaran (between Kanjur Marg and Mulund) charged less in tariff.

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