Fearing a backlash over the proposed increase in tariff by the State electricity distribution company (MahaVitaran), the Maha Vikas Aghadi government on Friday clarified that domestic consumers and farmers won’t have to bear the burden and will continue to get power at the current rate.
The State government’s move comes after the MahaVitaran, in a proposal before the State Electricity Regulatory Commission (SERC), has sought an average 5.8% increase in tariff.
Power Minister Nitin Raut, who met MahaVitaran officers, was categorical that it was not binding on the government to accept the proposed tariff hike.
“We do not want to pass on the burden of any additional tariff hike to the consumers. So far MahaVitaran has given its proposal to SERC which has yet to deliver its order. The tariff relief given by the previous BJP government for industries in underdeveloped Vidarbha and Marathwada regions will continue,” he said.
Maharashtra State Consumer Association’s Pratap Hogade opposed the tariff hike proposal saying that cost of power is already too high in Maharashtra. “The tariff revision sought by MahaVitaran is unwarranted,” he said.
MahaVitaran has submitted annual revenue requirement and tariff proposal for five years in which it has asked for an average hike of 5.8% for 2020-21, 3.25% for 2021-22, 2.93% for 2022-23, 2.61% for 2023-24 and 2.54% for 2024-25. It has argued that tariff revision is necessary to ensure recovery of full cost of services from consumers to sustain its operations, bridge revenue gap and meet additional costs due to increase in generation and transmission costs, regulatory assets and its legitimate expenses.
MahaVitaran has stated that its revenue gap has surged due to additional costs which are beyond its control. The revenue gap for the period between 2020-21 and 2024-25 has been estimated at ₹46,476.66 crore and the net recovery required from tariff works out to ₹60,313.11 crore. MahaVitaran has to recover arrears of over ₹25,000 crore from agriculture consumers alone.
