Committee members will hold a meeting with the management and intend to approach the state govt, as they fear the transport wing may cease to exist

Mumbai : The Brihanmumbai Electric Supply and Transport (BEST) says it is not unduly worried about the SC decision ending its monopoly over power distribution in South Mumbai. The committee members will hold a meeting with the management and intend to approach the state government, as they fear the transport wing may cease to exist.

It feels that Tata Power will have to hike its rates in two years as it will have to finally factor in the cost of infrastructure such as laying cable lines. Not only laying the cable lines will be a hurdle but also the setting up of transformers in the city will pose a challenge. Committee member Sunil Ghanacharya said, “Tata Power will have to start from the scratch which will take them a couple of years. In the meanwhile we will decide our course of action though the lower class consumers will suffer as there will be no subsidy.”

The committee members have called for a meeting on May 20 during which various possibilities will be discussed pertaining to the future of the transport wing of the undertaking. The major blow will be to the low-end consumers, which were given electricity at subsidised rates. The consumers will now have to shell out more as the traffic will increase and the power will be non-subsidised. Committee member Ranjaan Chowdhary said, “Now if we purchase the power at 5 per unit it will be sold at that rate itself unlike the existing Re 3 per unit. We will not be able to cross subsidise the transport wing, which will be a major challenge for its existence.”

He further added, “In other countries the transport department is funded from the state government. We will ask the state government if they want to hand over the transport wing to Tata Power for making it run?”

The BEST undertaking was the sole electricity provider in the island city which is from Colaba to Sion. The management fears with the competition from the Tata Power they will lose their high-end consumers that contribute to the major profit making of the electricity wing.

Of the 10 lakh consumers that the BEST has in the city, over 83,000 consume more than 300 units a month. These consumers pay a surcharge to cross-subsidise BEST’s transport wing.

The management fears that these consumers will jump to Tata reducing the profit of the undertaking. Moreover, the new consumers in malls and offices  will also opt  for Tata Power. BEST General Manager Om Prakash Gupta said, “The BEST will lose its high-end consumers along with the consumers that will come in with new developments and the upcoming malls in the city. It will be easier for Tata Power to set up power station near the malls to supply electricity.”

Officials from the BEST stated with the shift of the high-end consumers the burden of the consumers with low usage, will have to face the burden of the surcharge.

A power expert, Sandeep Ohri said, “The undertaking has to stop levying surcharges on to the electricity consumers to subsidise its transport wing. The entry of Tata has given consumers the option to choose the best for them.”

The management however said that the undertaking does not mind if the lower end consumers shift to Tata as it will more beneficial for them. The manager further stated that if Tata approaches the BEST it may as well share their cable lines on welling charges.

BEST power tariff Tata power tariff
0-100: 0.55 + 2.65 0-100: 2.08+0.41
01-300: 1.03 + 5.35 101-300: 2.08+2.05
301-500: 1.44 + 7.50 301-500:2.08+5.23
> 500: 1.85 + 9.55 >500:2.08+7.01

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