If Reliance Infrastructure brings electricity to your home, your power bills will soon go up.
The Supreme Court has allowed the company to recover from its consumers Rs 350 crore it had offered as rebate to high-end users between 1999 and 2004 to discourage them from switching to Tata Power Company (TPC).
A bench of Justice P. Sathasivam and Justice B.S. Chouhan on Thursday rejected TPC’s appeal against the ruling of the Appellate Tribunal of Electricity (ATE) that the rebates RInfra offered were legal. The Maharashtra Electricity Regulatory Commission (MERC) had termed the rebates illegal and added them to RInfra’s earnings and reduced tariff for all consumers.
The ATE, however, said that the rebates were legal following which TPC moved the Supreme Court. The court said the ATE’s judgment will be binding on TPC and RInfra.
RInfra’s demand for recovering Rs 2,000 crore under several heads is pending with MERC.
The SC let RInfra to seek MERC’s permission to recover the amount from consumers.
A spokesperson for RInfra said the sum will be recovered through the annual revenue requirement (ARR), which determines the tariff.
It will be a while before consumers feel the pinch because RInfra has not filed its ARR with the MERC for the next year. Once RInfra files the ARR factoring in the money it needs to recover and presents the tariff rate that will help it do that, MERC will decide on how it the hike needs to be affected.
Sources said the judgement will encourage RInfra to offer high-end consumers more rebate to stop them from moving to TPC’s inexpensive supply.