
Maharashtra to reduce electricity tariffs by 10-30% from April 1
What's the story
In a major relief to consumers, the Maharashtra Electricity Regulatory Commission (MERC) has sanctioned a significant reduction in electricity tariffs for residential consumers.
The new rates, effective from April 1, will witness a fall of 10%-30% for residential consumers.
However, this unprecedented cut includes a decrease in cross-subsidies for industries, with different reductions for high-tension (HT) and low-tension (LT) industries.
This is part of the multi-year tariff order issued by MERC on its website.
Revenue reconciliation
MSEDCL's revenue gap reconciled, surplus passed to consumers
A senior officer of the Nashik Zone of Maharashtra State Electricity Distribution Company Limited (MSEDCL) has confirmed that a revenue surplus of ₹44,480 crore has been approved by the MERC.
The surplus comes due to the reconciliation of previous discrepancies and future projections for power procurement and revenue generation.
According to the officer, this surplus has been passed on to consumers through lower tariffs for five years.
Losses and renewables
Factors behind the tariff reduction
MERC has credited the dip in tariffs to two reasons.
One is MSEDCL's failure to restrict distribution losses at 14% (actual losses were 22%).
The second is anticipated savings in cost from future renewable energy generation.
These reasons prompted MERC to reduce cross-subsidies for high-tension (HT) and low-tension (LT) industries by 12% and 8%, respectively.
Positive response
MERC's decision praised by consumer representatives
Siddharth Varma, secretary of Veej Grahak Samiti, Nashik, former MERC consumer representative, has lauded the commission's decision.
There are certain charges whose applicability is unclear, but he hopes the relief would be around 10-15%.
Varma also noted that as part of this initiative, MERC has exempted residential consumers with rooftop solar panels from 'Time of Day' charges.