Electricity bills to go up by 11 per cent

After announcing a reduction in the industrial power tariff in Vidarbha and Marathwada region, the state government has increased fuel adjustment cost (FAC) by 11 per cent, forcing consumers to shell out more money for electricity bills from this month.

The Maharashtra State Power Distribution Company Limited (Mahadiscom) has increased FAC for three months till July leading to an 11 per cent increase in electricity bills to overcome its losses. “With the FAC hiked for May, June and July, the consumers will have to bear the burden which amounts to Rs 1.33 per unit from the earlier 37 paise,” an energy department official said. The Mahadiscom will collect Rs 500 crore every month by imposing the FAC on the consumers. Also, the Mahadiscom has proposed power tariff hike of five per cent per year for the period between 2016-17 and 2019-20. This will put a burden of Rs 39,000 crore on the consumers. The proposal would be soon made public, said the official.

The state in its budget had announced reduction of industrial tariff for backward regions of Vidarbha and Marathwada to boost their industrial growth. This puts a burden of Rs 9,000 crore on the state exchequer. Sources in the energy department said that by increasing FAC, the state would endevour to overcome the burden. “Earlier, the energy minister announced waiving off the FAC. He then said only 25 paise FAC would be imposed. However, none of his announcements were enforced. Industrial consumers are not happy with the increase in FAC. Maharashtra already has the highest electricity tariff for industrial consumers compared to its neighbouring states. The hike in FAC will affect industrial consumers the most,” Pratap Hogade, president of Maharashtra Veej Grahak Sanghatana, said.

The industrial tariff in the state is between 25 to 35 per cent higher than the other states. The state did not witness an increase in industrial consumers in the last five years. The FAC has been imposed to release a burden on the Mahadiscom owing to high generation cost and inefficiency of the company, he said. Consumers are forced to buy expensive power when cheaper power is available in the market, he added.