Bihar power regulator BERC okays 24% hike, says power discoms sought 54% rise in tariff

The net hike in the power tariff for consumers, however, will be known only after the state government announces its subsidy over the next few weeks.

PATNA: The Bihar Electricity Regulatory Commission (BERC) on Thursday approved a 24% hike in power tariff across all categories of consumers in the next financial year beginning April 1. The commission has also doubled the fixed charges, the minimum monthly per kilowatt (kW) charges a consumer pays in addition to the tariff for actual power consumption.

Bihar Electricity Regulatory Commission chairman Shishir Sinha (left) and member Subhash Chandra Chaurasia announcing the revised power tariff for 2023-24 in Patna (HT Photo)

The net hike in the power tariff for consumers, however, will be known only after the state government announces its subsidy over the next few weeks.

There was no revision in tariff last year despite power distribution companies, or discoms, proposing a 9.9% hike for 2022-23. For 2021-22, the commission approved an average cumulative tariff hike of 0.63%, which effectively translated into a hike of between 5 paise and 35 paise per unit for domestic urban consumers.

The new tariff will come into effect from April 1, and continue till March 31 next year, or till the next tariff order, said BERC chairman Shishir Sinha, as he read out the order of the two-bench commission, which included Subhash Chandra Chaurasia as its member.

“The two discoms – the South and the North Bihar Power Distribution Companies Ltd. — proposed a cumulative increase of 53.62% in power tariff for 2023-24, but we agreed to increase it by 24.10% only,” said Sinha.

Sinha added that the state government’s power subsidy bill was around ₹8,000 crore last year.

The commission has also reduced the tariff slabs from three to two for domestic and non-domestic consumers.

The reduction in tariff slab is also expected to pinch the consumers, as they will now have to pay the highest per unit cost of energy for a particular category, after the initial consumption of 50 units in the case of rural consumers, and 100 units for urban consumers.

For instance, after the merger of the second slab, urban domestic consumers will have to pay between ₹1.05 and ₹2.15 per unit more, as compared to the prevailing rate.

The commission revised the rate per unit to ₹7.57 from the existing ₹6.10 for the first 100 units of energy consumption. For the next tariff slab of 101 units and above, the revised rate will be ₹9.10 as against an existing ₹6.95 for consumption between 101 and 200 units, and ₹8.05 for monthly consumption beyond 200 units.

Rural domestic consumers will pay ₹7.57 per unit for the first 50 units against the existing rate of ₹6.10, an increase of ₹1.47. For the next tariff slab beyond 51 units, rural consumers will now pay ₹8.11 per unit as against the existing ₹6.40 for consumption between 51 and 100 units, and ₹6.70 for monthly consumption above 100 units.

Non-domestic urban consumers, with contract demand above 0.5kW and up to 70kW will now have to pay ₹7.88 per unit for the first 100 units against the existing figure of ₹6.35. For the next tariff slab above 100 units, they will now pay ₹9.08 per unit against the existing ₹6.85 for 101-200 units and ₹7.40 for monthly consumption beyond 200 units.

For non-domestic rural consumers, the revised per unit rate will be ₹7.94 for the first 100 units and ₹8.36 for above 100 units, as against an existing rate of ₹6.40 for 100 units, ₹7.00 for 101-200 units and ₹7.55 for monthly consumption above 200 units.

In a nominal relief to rural consumers, the commission agreed to offer a 1% rebate on the total monthly energy bill of the last quarter to post-paid rural consumers.

Sinha defended the commission’s decision to raise the power tariff by 24%.

“The average per unit power purchase cost from central sectors that was ₹4.9 for discoms has gone up to ₹5.82 in the last year due to an increase in fuel prices. In addition, the transmission cost levied by central transmission utilities has gone up by more than 80% during this period,” said Sinha, defending the hike in power tariff.

The state government had given a subsidy of around ₹8,000 crore last year, he added.

The government’s per unit subsidy to consumers was ₹3.50 for BPL families, ₹3.50 for rural domestic consumers (DS I), ₹1.83 for urban domestic consumers (DS II), ₹2.92 for non-domestic rural (NDS I) and ₹0.53 for non-domestic urban consumers (NDS II).

“The average effective hike in tariff for urban domestic consumers was around 30% without subsidy, given the increase in fixed and energy charges, decrease in tariff slab from three to two, and an electricity duty of 6%,” said Nand Sharma, an independent power tariff analyst and a former tariff consultant of the BERC. He linked the hike to an increase in power purchase costs from NTPC.

The Bihar Industries Association (BIA) expressed serious concern at the hike in power tariffs.

“The government should increase the subsidy component to lessen the impact of the hike on the common man. It should also consider extending subsidies to industries to promote them. Besides, the government should also ask discoms to tone up their aggregate transmission and commercial (AT&C) loss, which was around 30% at present, against 15% fixed by the regulator against the claim of 20.12% for NBPDCL and 22.06% for SBPDCL for 2023-24,” said Basudeo Prasad, chairman of the BIA energy committee.