Maharashtra goes AAP way, cuts power tariff by 20%
Updated: Jan 21, 2014 03:27:57pm
Mumbai, Jan 21 (KNN) Taking a leaf out of Aam Aadmi Party's book, the Congress-led Maharashtra government has approved a 20 per cent cut in power tariff for all categories of consumers - industry, domestic, and agriculture across the State, barring Mumbai. The tariff cut will be implemented from February 1.
Maharashtra’s move comes after Delhi chief minister Arvind Kejriwal recently announced to cut power tariffs by up to 50 per cent through a subsidy.
In the rest of Maharashtra except Mumbai, the government has put a cap of 300 units a month for domestic consumers to become eligible for a 20 per cent cut in the power tariff through a subsidy. There is no such cap for industrial, commercial and agriculture consumers.
Average power rate for industrial consumers, which is about Rs 8.50 a unit, will be reduced by Rs 1.70 a unit.
According to the state cabinet's decision, a high-tension industrial power consumer drawing power from an express feeder will have to pay Rs 7.01 a unit against the present tariff of Rs 8.61 a unit, while a non-express feeder high-tension power user will have to pay Rs 6.33 a unit against Rs 7.83 a unit.
For low-tension industrial consumers, the tariff has been cut to Rs 5.06 from Rs 6.17 (0 to 20 kw) and for 20 kw and above Rs 7.01 from Rs 8.76 per unit. As far as powerlooms are concerned, per unit tariff has been reduced to Rs 5.66 from Rs 7.26.
While, the average rate for domestic consumers whose consumption is below 100 units per month will come down from Rs 4.16 per unit to Rs 3.36 per unit; for consumers whose consumption is above 100 but below 300, their per unit rate will come down from 7.42 per unit but to 6.05 per unit.
However, the government has to seek the approval of the Maharashtra Electricity Regulatory Commission before the measure can be implemented.
The state government said the move comes after various industry associations had made repeated presentations for reducing the power tariff for them as it was high compared with neighbouring states.
Various industry bodies had protested against the high power tariff, which they claimed was 20 to 50 per cent higher than that in states such as Gujarat, Madhya Pradesh, Karnataka and Andhra Pradesh.
Though the state has a budget surplus of just Rs 27 crore in FY13 and a planned surplus of Rs 184 crore in FY14, Maharashtra Government yesterday made the announcement of Rs 7,200-crore annual cut in electricity prices.
In order to make up for the rate cut, the state-owned power utilities Maharashtra State Power Generation Co Ltd and Maharashtra State Power Transmission Co Ltd will have to pay Rs.1,200 crore to state-owned power distribution utility Mahavitaran Ltd to make up for the rate cut.
Maharashtra already spends around Rs 11,500 a year by way of subsidy to keep tariffs low for agriculture and power loom consumers.
While the total subsidy burden will be Rs 706 crore a month, the government said Rs 606 crore will be borne by the state government while Rs 100 crore will be borne by the Maharashtra State Electricity Transmission Company (MahaTransCo) and Maharashtra State Power Generation Company (MahaGenCo).
The accumulated profits of both companies were Rs 2,200 crore in FY12. Yesterday’s orders excluded the Maharashtra State Electricity Distribution Company (MSEDCL) whose accumulated losses in FY12 were Rs 4,649 crore, up sharply from Rs 3,793 crore in FY11.
Consumers in Mumbai will not benefit from the reduced rates because the city is served by three different utilities.
The municipal undertaking Brihanmumbai Electric Supply and Transport (BEST) supplies power between Colaba and Nariman Point in the south and Sion and Mahim in the north, while Tata Power Co Ltd and Reliance Infrastructure Ltd to the suburbs. The rest of the state is served by Mahavitaran.
In a similar move, taking a cue from AAP government in Delhi, Bhupinder Singh Hooda, chief minister of Haryana, last week reduced power tariff across the board in the state.
Hooda gave a relaxation of Rs 1.30 per unit to domestic consumers who use up to a thousand units every two months. The tariff per unit for farmers was reduced from 25 paise to 10 paise. The changes will come into effect from January 1. However, this will cost the state Rs 6,500 crore per year, according to calculations by the electricity distribution companies (discoms). (KNN Bureau/SD)
Maharashtra’s move comes after Delhi chief minister Arvind Kejriwal recently announced to cut power tariffs by up to 50 per cent through a subsidy.
In the rest of Maharashtra except Mumbai, the government has put a cap of 300 units a month for domestic consumers to become eligible for a 20 per cent cut in the power tariff through a subsidy. There is no such cap for industrial, commercial and agriculture consumers.
Average power rate for industrial consumers, which is about Rs 8.50 a unit, will be reduced by Rs 1.70 a unit.
According to the state cabinet's decision, a high-tension industrial power consumer drawing power from an express feeder will have to pay Rs 7.01 a unit against the present tariff of Rs 8.61 a unit, while a non-express feeder high-tension power user will have to pay Rs 6.33 a unit against Rs 7.83 a unit.
For low-tension industrial consumers, the tariff has been cut to Rs 5.06 from Rs 6.17 (0 to 20 kw) and for 20 kw and above Rs 7.01 from Rs 8.76 per unit. As far as powerlooms are concerned, per unit tariff has been reduced to Rs 5.66 from Rs 7.26.
While, the average rate for domestic consumers whose consumption is below 100 units per month will come down from Rs 4.16 per unit to Rs 3.36 per unit; for consumers whose consumption is above 100 but below 300, their per unit rate will come down from 7.42 per unit but to 6.05 per unit.
However, the government has to seek the approval of the Maharashtra Electricity Regulatory Commission before the measure can be implemented.
The state government said the move comes after various industry associations had made repeated presentations for reducing the power tariff for them as it was high compared with neighbouring states.
Various industry bodies had protested against the high power tariff, which they claimed was 20 to 50 per cent higher than that in states such as Gujarat, Madhya Pradesh, Karnataka and Andhra Pradesh.
Though the state has a budget surplus of just Rs 27 crore in FY13 and a planned surplus of Rs 184 crore in FY14, Maharashtra Government yesterday made the announcement of Rs 7,200-crore annual cut in electricity prices.
In order to make up for the rate cut, the state-owned power utilities Maharashtra State Power Generation Co Ltd and Maharashtra State Power Transmission Co Ltd will have to pay Rs.1,200 crore to state-owned power distribution utility Mahavitaran Ltd to make up for the rate cut.
Maharashtra already spends around Rs 11,500 a year by way of subsidy to keep tariffs low for agriculture and power loom consumers.
While the total subsidy burden will be Rs 706 crore a month, the government said Rs 606 crore will be borne by the state government while Rs 100 crore will be borne by the Maharashtra State Electricity Transmission Company (MahaTransCo) and Maharashtra State Power Generation Company (MahaGenCo).
The accumulated profits of both companies were Rs 2,200 crore in FY12. Yesterday’s orders excluded the Maharashtra State Electricity Distribution Company (MSEDCL) whose accumulated losses in FY12 were Rs 4,649 crore, up sharply from Rs 3,793 crore in FY11.
Consumers in Mumbai will not benefit from the reduced rates because the city is served by three different utilities.
The municipal undertaking Brihanmumbai Electric Supply and Transport (BEST) supplies power between Colaba and Nariman Point in the south and Sion and Mahim in the north, while Tata Power Co Ltd and Reliance Infrastructure Ltd to the suburbs. The rest of the state is served by Mahavitaran.
In a similar move, taking a cue from AAP government in Delhi, Bhupinder Singh Hooda, chief minister of Haryana, last week reduced power tariff across the board in the state.
Hooda gave a relaxation of Rs 1.30 per unit to domestic consumers who use up to a thousand units every two months. The tariff per unit for farmers was reduced from 25 paise to 10 paise. The changes will come into effect from January 1. However, this will cost the state Rs 6,500 crore per year, according to calculations by the electricity distribution companies (discoms). (KNN Bureau/SD)
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