The Hindu Business Line : Maha Vitran plea to hike power tariff opposed

Tariff petition
Maha Vitaran has projected that it would have to pay Rs 17,359 crore for the purchase of 78,453 million units of power.
Certain crucial issues in Maha Vitran petition like `Regulatory Liability Charges' still remain unresolved.

Mumbai , Aug 25

Domestic and industrial consumers have opposed Maharashtra State Electricity Distribution Company Ltd's (Maha Vitran) petition for annual revenue requirement (ARR) and hike in power tariff for the financial year 2007.

At a hearing before the Maharashtra Electricity Regulatory Commission (MERC), consumers pointed out that Maha Vitran's calculation for the tariff hike was faulty. They sought additional information about the operations of Maha Vitran to get the correct picture.

MahaVitaran has projected that it would have to pay Rs 17,359 crore for the purchase of 78,453 million units of power from Maharashtra State Power Generation Company Ltd (Maha Genco), Ratnagiri Gas and Power Private Ltd, a central government power station and other renewable sources.

Regulatory liability charges

Mr Ashok Pendse, Team Leader (Energy Practice) with Mumbai Grahak Panchayat, told Business Line that certain crucial issues in Maha Vitran petition like `Regulatory Liability Charges (RLC)' still remain unresolved. More than Rs 2,531 crore of the consumers are with Maha Vitran in the form of RLC, which should be returned to the consumer. RLC was introduced in financial year 2003-04 at the rate of 0.50 paise per unit for subsidising low-tension commercial consumers, Railways and for funding the cost of excess transmission and distribution losses, he said.

Mr Pendse said that if Maha Vitran needs oxygen in the form of tariffs to recover the cost of excess losses, the consumers are willing to contribute the same, provided it is treated as regulatory liability owed by Maha Vitran to the consumers and not as part of Maha Vitran's rightful revenue requirement. It should be treated only as interim measure, he said.

The Thane Small Scale Industries Association (TSSIA) in its petition to the MERC pointed that the tariffs hike for SSI units from 60 per cent to 108 per cent was exorbitant. It will raise the input cost of the small units to such a level that it would be impossible to continue conducting business. Ms Sujata Soparkar, Secretary, TSSIA, said that like agriculture, SSIs should be exempted from the proposed increase tariff hike.