Eastern suburbs will pay more for power from today

Consumers in the eastern suburbs of Kanjurmarg, Bhandup and Mulund as well as Thane, Navi Mumbai and the rest of Maharashtra will have to pay more for power from November 1.

Consumers in the eastern suburbs of Kanjurmarg, Bhandup and Mulund as well as Thane, Navi Mumbai and the rest of Maharashtra will have to pay more for power from November 1.

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The bills of 1.80 crore consumers will increase because the Maharashtra Electricity Regulatory Commission (MERC) has sanctioned a partial relief of Rs3,265 crore to the state distribution company, Mahavitaran. The recovery is expected to improve Mahavitaran’s credit worthiness with commercial banks, which refused loans because the utility faced a deficit of more than Rs 5,000 crore.

Subsequently, Mahavitaran asked MERC to recover dues of Rs 5,155 crore, which it spent for buying power among other things that were approved by the commission.

The hike will not be uniform for all categories. The average hike across all categories will be 41 paise per unit, which will be implemented over the next 12 months.

Domestic consumers will pay anywhere between 8 and 74 paisa per unit depending on consumption. Commercial consumers will pay anywhere between 78 and 81 paisa extra per unit consumed. Industries will bear the burden of around 49-60 paisa per unit.

These extra charges will be in addition to what the MERC is expected to determine in the new tariff for the current financial year, for which a public hearing was held this month.

Mahavitaran, in its application to the MERC, asked the commission to provide interim relief of Rs 5,155 crore because it did not have the money to buy power from generators. It even threatened to stop buying power if the situation went out of control.

MERC approved a hike with a rider. It wants Mahavitaran to present a road map for recovering its dues, which exceed Rs15,000 crore. “Given the fact that around Rs2,500 crore of arrears are less than 12 months old, the commission is of the view that Mahavitaran can significantly improve its liquidity position by improving its collection efficiency,” said the MERC order.