Mumbai power tariff face-off: BEST proposes hikes, Adani and Tata slash rates

Mumbai's BEST plans to raise power tariffs for 10.50 lakh consumers, while Adani and Tata Power propose significant reductions for their 36.5 lakh users.

Mumbai: There is concerning news for the 10.50 lakh consumers of the Brihanmumbai Electric Supply and Transport (BEST) Undertaking as it has proposed higher power tariffs for the next five years (2025-26 to 2029-30). Meanwhile, the 29 lakh consumers of Adani Electricity Mumbai Limited (AEML) and 7.5 lakh consumers of Tata Power are set to benefit from year-on-year reductions in their power tariffs for the same period.

Mumbai power tariff face-off: BEST proposes hikes, Adani and Tata slash rates

BEST tariff proposals

BEST, one of the oldest power distributors in the country, supplies electricity to 10.50 lakh consumers in Mumbai’s island city, stretching from Cuffe Parade to Sion/Mahim. Under its multi-year tariff proposal submitted to the Maharashtra Electricity Regulatory Commission (MERC), BEST plans to increase rates for its most economically vulnerable consumers. Tariffs for the below poverty line (0-100 units) and 101-300 units categories will rise from the current ₹1.87 and ₹5.46 per unit to ₹2 and ₹5.55 per unit, respectively, in 2025-26. These rates are expected to increase further over the subsequent years.

In contrast, BEST has proposed a marginal decrease in tariffs for higher consumption brackets. Consumers using 301-500 units will see rates dip slightly from ₹9.46 to ₹9.45 per unit in 2025-26, while those consuming over 500 units will pay ₹11.55 per unit instead of the current ₹11.73. These adjustments reflect BEST’s strategy to balance revenue generation while competing with private players. BEST officials cited rising power purchase costs, exceeding ₹16,475 crore over the next five years, as the primary reason for the tariff hike. Of this, ₹9,483 crore will be paid to Tata Power’s Trombay Power Plant.

“Nowadays, consumers are highly sensitive to power bills. Even a slight increase can push them to switch to another distributor. We have aimed to propose the best possible tariff under current constraints,” a BEST official stated.

Competitive tariff reductions by Adani Electricity

In stark contrast, AEML and Tata Power have proposed substantial tariff reductions, fuelling competition between the two corporate giants. For the first time, Adani Electricity has suggested merging the 301-500 units and >500 units categories, allowing high-consumption households to benefit from a reduction of more than ₹5 per unit. This merger could benefit approximately 10 lakh consumers, leading to a potential 30% tariff reduction for higher consumption households. AEML also aims to halve its Green Tariff rates from 66 paise per unit to 30 paise per unit, further incentivising sustainable energy use.

An AEML spokesperson remarked, “At Adani Electricity, we are placing consumers at the heart of our proposed tariffs, delivering an immediate 15% average tariff reduction and up to 42% cuts for key segments. By halving green tariffs and simplifying billing, we aim to make energy more affordable, sustainable, and inclusive.”

Tata Power’s Mumbai Distribution division has also submitted a consumer-friendly proposal, promising an average tariff reduction of 17.8% for 2025-26. For residential users, this translates to electricity bill reductions ranging from 7.4% to 14% over the next five years. “Our proposal is designed to provide consistent relief to consumers while ensuring a reliable power supply,” said a Tata Power spokesperson.