BEST to cut tariff for residential, commercial consumers

While the tariff reduction for residential consumers is in the range of 9-10%, the reduction for commercial users is 7-40%.

In a major relief to consumers of the Brihanmumbai Electric Supply and Transport Undertaking (BEST), the body has now proposed scrapping the contentious Transport Division Loss Recovery (TDLR), which it had initially proposed to apply. As a result, the undertaking will cut tariffs for residential consumers as well as commercial consumers. While the tariff reduction for residential consumers is in the range of 9-10%, the reduction for commercial users is 7-40%.

The relief, however, might be short-lived. BEST has, in its tariff petition submitted to the Maharashtra Electricity Regulatory Commission, said it might bring back TDLR if the Supreme Court rules in favour of the charge in an ongoing petition.

Until or if that happens, consumers have been offered relief. Except for below the poverty line consumers, whose tariffs BEST has proposed to increase by 18%, all the other categories of residential consumers have been offered a reprieve by BEST. It has proposed leaving the tariff for low-end homes, consuming less than 100 units, unchanged. The tariff cut proposed for those consuming between 100 and 300 units and between 300 and 500 units is 9%, while for those consuming more than 500 units, the cut has been proposed at 10%.

The reduction would have been steeper had it not been for BEST’s decision to increase fixed charges — a charge that power distribution companies impose on consumers, depending on their power usage every month. BEST has proposed to hike these charges for residential consumers in the range of 25-33%, across all categories.

In its petition, BEST claimed it has a revenue gap of Rs1,870 crore in its power business, which it hopes to recover in parts in the next four years. But despite the proposed tariff, BEST will still have a revenue gap of Rs857 crore by 2019-20, according to its own estimates.