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Consumers may have to pay more for Tata power

mumbai Updated: Apr 21, 2012 02:25 IST
Dharmendra Jore

Electricity from Tata Power Company (TPC) will cost you a little more in the next four years. Currently, the rate at which the utility sells power is the lowest in the city.

In its multi-year tariff (MYT) plan submitted to the Maharashtra Electricity Regulatory Commission (MERC) for approval, the utility has assured to keep its average cost of supply below Rs6 per unit till 2016. The MYT plan helps consumers know the hike the utility would introduce in the financial year in advance. A company is allowed to raise tariff only when uncontrolled factors impact the company’s business. The regulatory body will approve the plan after conducting a public hearing at Rangsharda Natymandir in Bandra on May 19.

Currently, TPC’s average cost of supply is Rs5.20 per unit while that of the Brihanmumbai Electricity Supply and Transport (BEST) is Rs6.77 per unit. The cheap rate had attracted lakhs of suburban consumers. The company was given permission to supply power in the distribution area of BEST on the condition that it should lay down its own network to connect new consumers.

While BEST has asked for an average rate of Rs8.32 per unit, suburban supplier Rinfra that has an existing average rate is Rs7.06 per unit had not sought any tariff hike in 2011-12. Mahavitaran, which caters to some eastern suburbs, sells power at an average rate of Rs5.15 but it charges more than Tata from high-end consumers (industry and commercial) so that it can cross subside more than 1 crore low-end consumers. Also, the state company does not have a licence to distribute power in other areas.

According to an industry expert, comparing the tariff of all four companies would not be possible because only TPC has filed its MYT. “TPC’s final tariff per unit will also include fuel charges, wheeling charges for migrated consumers who use RInfra network to get TPC supply. The MYT suggests that the TPC supply would be affordable. It will increase if unforeseen factors like increased fuel costs and expenditure of laying network are recovered from the consumers.” The expert did not wish to be named because he would participate in the public hearing next month.