Power rates may rise in Mumbai with Tata’s entry, fears BEST

  • Prajakta Chavan Rane, Hindustan Times, Mumbai
  • Updated: Sep 11, 2014 16:16 IST

Residential consumers in the island city of Mumbai may have to pay a higher power tariff in the coming days, while the bus fares of 40 lakh commuters may rise, if Tata Power eats into the Brihanmumbai Electric Supply and Transport (BEST) undertaking’s share of high-end consumers.

With Tata Power being allowed to supply to households and companies [earlier it only supplied to bulk users], BEST is apprehensive that it may take away its high-end users, as a result of which it won’t be in a position to provide power at lower rates to low-end ones [those who have lesser consumption].

BEST supplies electricity to the island city. Out of the 10 lakh power consumers, around 3 lakh consume less than 300 units a month, falling into the low-end category. The tariff for this bracket of consumers is cross-subsidised by that paid by high-end users. High-end users pay more per unit of electricity. The transport wing is also cross-subsidized through the transport deficit loss recovery (TDLR) charge levied on BEST’s electricity consumers.

Committee members at a meeting on Wednesday urged the undertaking to come up with a contingency measures. “We should have a plan ready for when Tata Power enters the market, so that if it takes away our high-end consumers, our low-end ones don’t suffer,” said Sunil Ghanacharya, a committee member.

“Even bus commuters could be affected by this,” said committee member Kedar Hombalkar. “It’s high time the BEST draws up a concrete plan.”

The BEST electricity wing has approached the Appellate Tribunal for Electricity (APTEL), requesting them to ask Tata Power to have a mixed consumer base. “We have requested the appellate tribunal that Tata should cater to mix consumer base and should not be allowed to pick high-end users alone,” said OP Gupta, BEST general manager, at the meeting.


Tata, meanwhile, has written to Maharashtra Electricity Regulatory Commission (MERC) that the TDLR be recovered by all users in city, instead of burdening island city consumers alone.

“However, no order has been passed on this so far,” said a senior official from BEST, requesting anonymity.

When contacted by HT, Gupta said, “Tata should start recovering TDLR from their existing customers in BEST areas in the island city and remit the amount to the undertaking.”

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