In a bid to attract new investors and encourage industries to set up shop in less-developed regions of the state, the state government has decided on a substantial reduction in industrial power tariff in Marathwada, Vidarbha and tribal areas in north Maharashtra.
The decision was approved by a cabinet sub-committee headed by state energy minister Chandrashekhar Bawankule on Wednesday, and will be in effect from April 1, 2016 till 2019.
Mr. Bawankule said, “While the committee did not take a decision on domestic tariff, it was decided after two meetings that tariff for Marathwada, Vidarbha and D and D+ regions will get power at subsidised rates.”
He added that the state government has already allocated Rs 1,000 crore in the budget for state-run MahaVitaran as compensation for subsidy losses. The reduction in tariff will be carried out by way of incentive in the load factor and fuel adjustment cost.
Senior officials said the tariff cut in Marathwada will be about Rs. 1.50 per unit, between Rs. 1.25 and Rs. 1.75 in Vidarbha and Re 1 in north Maharashtra.
This week, the state cabinet had decided to levy additional duty on industries sourcing power from the Open Access grid and moving out from the state grids.
As many as 500 industries have reportedly moved away from state grids. Mr. Bawankule said there was no contradiction in state policies while inviting investment with lower tariffs and making those on the Open Access grid pay extra. “We are maintaining a balance. Once these new concessions are applied, the state tariff will be cheaper compared to its neighbours,” he said.
The sub-committee did not recommend fixing tariff at Rs 4.25 for certain categories to compete with neighbouring states that offer lower tariff. As of now, the industrial tariff rate in Maharashtra is around Rs 8.3 per unit, while Karnataka, Gujarat and Goa have fixed this at Rs. 6.90, Rs. 6 and Rs. 4.80 respectively.
The tariff cut in Marathwada will be about Rs. 1.50 per unit, and Rs. 1.75 in Vidarbha
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