Uniform power tariff being planned for Mumbai, may reduce your bill

Energy minister has asked officials of BEST, RInfra, Tata Power and MSEDCL to look at a uniform tariff for those consuming between 0-300 units; most of city’s residential consumers fall under this category and move may bring the rates down

If the Maharashtra government has its way, most Mumbaikars may pay uniform rates for electricity, irrespective of their power distributor. The tariff may also be lower than the one that they are currently paying.

Electricity
Of the three major electricity providers, RInfra has the highest number of consumers in the 0-300 units category. File Pic

On Monday, State Energy Minister Chandrashekhar Bawankule met officials of BEST, Tata Power, Reliance Infrastructure and Maharashtra State Electricity Distribution Company Ltd (MSEDCL), the four companies that distribute power in Mumbai, and asked them to look at having a uniform tariff for residential consumers who use less than 300 units a month.

Speaking to mid-day, the minister said, “We have asked all four power distributors to look at ways to have uniform electricity tariffs for residential consumers consuming between 0 and 300 units. This might also result in lower tariffs. However, the final decision lies with the Maharashtra Electricity Regulatory Commission (MERC).” MERC is a quasi-judicial body which decides power tariffs annually.

In Mumbai, there are more than 42 lakh power consumers, of which a majority consume less than 300 units a month. Out of this, the BEST has 10 lakh consumers, Tata Power has over 6 lakh consumers, and Reliance Infra has around 26 lakh consumers. MSEDCL supplies electricity to a few thousand residents in areas like Mulund and Bhandup.

Hurdles
Sources said the main hurdle in having uniform tariff slabs will be deciding on what would be the ideal tariff for Mumbai. If the proposed rates for the current fiscal are taken into account (see box), BEST, which supplies electricity in the island
city, between Colaba to Mahim/Sion, is the costliest, followed by Tata Power, which caters to the suburbs. Reliance Infrastructure, which supplies power in parts of the western and eastern suburbs, is the cheapest of the three.

Sources said that, in accordance with the current methodology, the uniform tariff between 0-300 units will be divided into two slabs. There will be a lower rate for the first 100 units and a higher one for 101-300 units.

RInfra claims that 22 lakh of its 26 lakh consumers fall under the 0-300 unit category. The number is 5.5 lakh out of 10 lakh for BEST, and over 3 lakh out of 6 lakh for Tata Power.

The method of calculation of an ideal uniform tariff hasn’t been decided yet and, in all likelihood, either the tariff of BEST, Tata Power or RInfra will be taken as the standard, or the average of all three will be the uniform rate. However, the final approval will be given by the MERC, once a full-fledged proposal is made by the state government.

Expertspeak

“The state government will have to cross-subsidise around Rs 3,000 crore to these distribution companies if they have
a uniform tariff. This shouldn’t burden people again,” contended a  power expert.

42lakh The approximate number of power consumers in Mumbai

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