Karnataka MSMEs object to proposed hike in tariff by KERC

Bengaluru, Feb 16 (KNN) Karnataka Small Scale Industries Association (KASSIA) has opposed the move by the Bangalore Electricity Supply Company (BESCOM), which proposed a hike in tariff for the upcoming financial year, at the public hearing organised by the Karnataka Electricity Regulatory Commission (KERC).

BESCOM has stated that the Gap for FY 22 is Rs 3556.64 crores and hence has requested the Commission to hike the tariff by 139 paise per unit for all category of consumers.

Objecting the move, KASSIA on Monday, said the proposed revision would come within five months, ending up discouraging industries, and sought the KERC to continue the existing tariff for another year.

''The definition of fixed cost is the cost necessary to carry the investment and to replace the equipment when it is worn out. Fixed cost is based on the original cost of establishing the Generating Stations. The cost of Machines reduces every year based on the depreciated cost of machines. Under any condition the fixed cost should not be increased. Instead it should be reduced based on the depreciation. The present fixed cost of Rs 220 per KVA should be reduced due to depreciation,'' the industries body said.

They further argued that BESCOM should have clearly indicated steps taken for improvement of efficiency since the date of previous order and earlier orders issued by Commission indicating the efficiency gains of BESCOM, which could be ultimately transferred to the consumers proportionately.

Terming the hike sought as ‘unjustified’ for small scale industries, they argued that they are subjected to load shedding and unscheduled interruptions, resulting in loss of man hours and production.

“There is considerable scope for reduction in costs and improving efficiencies to set off the proposed additional expenditure by BESCOM. Therefore, the present tariff revision petition should be rejected,” the KASSIA petition said.