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Got an AC? Pay more for power

mumbai Updated: Sep 14, 2010 02:46 IST
Dharmendra Jore
Dharmendra Jore
Hindustan Times
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If you live in the suburbs and have at least one air conditioner, a microwave oven, water heater and television among other electrical appliances, your monthly electricity bills will go up by at least 30 per cent starting this month.

The Maharashtra Electricity Regulatory Commission (MERC) has permitted Reliance Infrastructure to hike its tariff by an average of 7 per cent with immediate effect.

Those using more than 500 units of electricity a month—and that includes most domestic users—will have to pay 30 to 35 per cent more for power.

Those using between 101 and 500 units a month—these are mostly lower middle class users — will see their power bills rise by 4 to 12 per cent.

The revised rates, applicable to more than 23 lakh suburban consumers, will be charged with retrospective effect from June 1, and will continue until further directives from the regulator. Those who did not pay according to the rates revised in the financial year 2009-2010 will have to pay the arrears.

RInfra chief Lalit Jalan said the company will ask MERC to schedule the recovery of arrears and other dues in a phased manner so that consumers do not feel the pinch.

MERC had stalled RInfra’s demand for hiking power tariff after public outcry and a government directive last July.

On Friday, MERC vacated the stay after Hyderabad’s Administrative Staff College of India that was probing the power supplier’s business model said in its report that the hike RInfra had demanded was justified and its business model was correct.

Industrial and commercial users, who are classified under a separate category, will pay 12 to 13 per cent less than what they have been paying for power because they enjoy

economies of scale that come with bulk use.

These high-end users include power guzzlers such as industries, malls and multiplexes.

In 2009, the regulator decided to gradually do away with the burden of cross-subsidy on high-end users.

Until then, rich consumers paid higher tariff and cross-subsidised domestic users like those living under the poverty line.

The new national electricity policy, however, recommended that the state government come out with a formula to eliminate cross-subsidy entirely and give high-end users relief.

Suburban consumers may expect an additional hike later this year because RInfra is yet to get a tariff hike approved for this financial year.