RInfra licence for suburbs: Your opinion counts

The Maharashtra Electricity Regulatory Commission (MERC) will seek the public view next month on whether it can grant the city’s suburban power distribution licence to Reliance Infrastructure.

The Maharashtra Electricity Regulatory Commission (MERC) will seek the public view next month on whether it can grant the city’s suburban power distribution licence to Reliance Infrastructure.

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Last year, MERC floated bids for the suburban licence because RInfra’s permit ends in August. Other than RInfra, the state-owned Mahavitaran, Ahmedabad-based Torrent, Indiabulls and Lanco are in the race for the licence.

Tata Power Company, which has distribution licence for the entire city and supplies power at 30 to 40% less than RInfra, has not applied.

In a notice uploaded on its website on Tuesday, the MERC said it was satisfied that prima facie the applicant (RInfra) qualified for grant of distribution licence for the proposed area of supply. The applications of other companies will be taken up for hearing soon.

In its bid, RInfra has said it would reduce tariff in the next five years. It said it would procure power at a lesser price and so it would be able to bring down the final billing cost.

The cost of power purchase is the highest component in a monthly bill.

RInfra has enlisted the power purchase agreements (PPAs) in its business plan so that its average power cost will reduce from Rs4.34 per unit in 2012 to Rs3.35 per unit in 2016.

The main reason for this is its tie-up with Reliance Power for 1,000 mega watts by 2016 and equal quantum from three other private entities. It also has its own 500MW plant in Dahanu.