No power subsidy for Mumbai

Mumbai :  Despite clamour from both within the Congress and the Nationalist Congress Party, the Prithviraj Chavan government is not amenable to giving any power subsidy to Mumbai city.

No power subsidy for Mumbai

The decision to reduce tariffs will remain in the hands of private power distribution companies. So, it will be some time before the residents of Greater Mumbai get some relief.

But the state government has asked all power distribution companies to revise their tariffs and bring parity for users who consume between 100-300 units per month.

The power companies have been directed to hand over to the government a road map for bringing down the existing tariff.

The government is also looking at power portability, so that consumers in this band (100 to 300 units) can switch over from Reliance to Tata, more so as the latter has lower tariffs.

 “We do feel that Mumbai residents feel the pinch as the power tariffs are high. Keeping this in mind we have had meetings with the power utility companies — BEST, Tata and Reliance. Reliance Infra rates are higher, no doubt, and we had undertaken a campaign recently to ensure that smaller consumers switch over to Tata, so that they get cheaper rates,” pointed out Chief Minister Prithviraj Chavan.

The Maharashtra Electricity Regulatory Authority (MERC), in its order in October 2013, had stated that 792,000 Reliance Infrastructure consumers who use

up to 300 units be allowed to switch over to Tata. The company had even placed advertisements in leading newspapers asking consumers to switch over. This campaign resulted in 15,000 smaller consumers shifting their loyalties to Tata.

Incidentally, the tariff for utilizing up to 100 units of Tata power is Rs 2.13 per unit while for Reliance Infra it is Rs 3.93; for 100-300 units of Tata power, it is Rs 3.62 per unit, while for Reliance it is Rs 6.84. These figures were given by the state government on Tuesday and bring out the glaring disparity in the rates.  Deputy Chief Minister Ajit Pawar confirmed that while the state is incurring a heavy debt, it has not extended the power subsidy to the private companies. However, he denied that this subsidy has added to the state’s debt position. “Yes, the government is incurring a huge burden on account of this power subsidy – roughly, Rs 700crore per month, which totals to Rs 8400 crore of annual additional expenditure. However, this has not impacted our debt position, which is still at 17.5 percent,” claimed Pawar.

Neeta Kolhatkar

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