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No inflated power bill for poor consumers

mumbai Updated: Jun 01, 2011 01:06 IST
Dharmendra Jore

The Maharashtra Electricity Regulatory Commission (MERC) on Tuesday assured the state-owned power distribution company, Mahavitaran, that it would determine the exact cross subsidy surcharge (CSS) for bulk power users.

These users buy power directly from other private power utilities, other than Mahavitaran. The CSS will ensure that migration to other power suppliers does not affect the power bills of low-end consumers.

On Tuesday, MERC chairman VP Raja assured Mahavitaran, consumer representatives and other power utilities that the commission would determine the surcharge at the earliest. The next hearing will be held in June.

Currently, industries that have been allowed open access — a procedure that facilitates direct purchase of power at rates lower than the prevailing rates of the existing distributor — avail power without paying any cross-subsidy surcharge.

Mahavitaran has lost many of its bulk consumers due to open access and was expected to lose many more in future. The company had demanded cross subsidy surcharge (CSS) of Re1 per unit from migrated consumers so that it can provide inexpensive power to the poor.

In the meantime, of the total open access proposals of 500 mega watts (MW), MERC approved allotment of 10MW to Indo Rama Industries. It is expected to decide on the remaining soon.

Mahavitaran managing director Ajoy Mehta told MERC on Tuesday that granting open access without CSS would affect low-end consumers.

“We have tied up for more power and many generation units will come up and supply power to us. Tell me what could we do with this surplus power when major consumers go to other utilities?”

The power battle had reached the Bombay high court and later the Supreme Court. While the HC refused to provide relief to Mahavitaran, the apex court asked the HC to decide the matter at the earliest. It also ruled that the bulk users should not expect old supplier to provide them standby power, in case of emergency.

Consumer representatives — Prayas Energy Group, the Thane-Belapur Industries Association and Vidarbha Industries Association — have supported the CSS, with Prayas and Thane Association even suggesting a surcharge between 72 and 82 paisa per unit.