Contrary to MSEDCL claims, electricity tariff may increase: Expert

Mumbai: Although the Maharashtra State Electricity Distribution Company (MSEDCL) has announced it’s proposing to reduce the power tariff for residential consumers from April, experts pointed out that those users who consume over 100 units of power per month may have to pay more as the distributor has proposed a hike of 85-99 paise per unit in the energy charge.

According to energy expert Ashok Pendse, the state-owned power distributor has used the so-called fuel adjustment charge (FAC) to hide a rise in energy charge in its new proposal.

MSEDCL, which supplies power to consumers in Mulund, Bhandup, Thane, Navi Mumbai, and the rest of the state, recently submitted a new power tariff proposal to the Maharashtra Electricity Regulatory Commission (MERC) for the next five years. The distributor claimed it had proposed a tariff reduction for those residential users who consume less than 100 units, 301-500 units and over 500 units of power per month.

Consumers who use over 100 units per month may end up paying 85-99 paise more per unit, as the MSEDCL has proposed a hike in the energy charge. People living in a one BHK home with electrical appliances like a TV, fridge, washing machine, geyser, air conditioner, and microwave would easily consume over 100 units per month, he said. As a result, the new proposed tariff may hike their monthly electricity bill by a few hundred rupees, he added.

MSEDCL has used the fuel adjustment charge to hide the actual rise in energy charge, which is the actual tariff. “In the power tariff, the energy charge is the main component used to calculate the bill based on the power consumption of that month,” said Pendse. “A fuel adjustment charge (FAC) is charged only if the company spends more than the estimated cost of power purchase. Thus, energy charge and FAC are two separate components of the energy bill. But to hide the actual hike, MSEDCL, in its application, merged FAC with the energy charge. So, consumers using more than 100 units of electricity per month will pay in the range of 85-99 paise more based on their consumption category.”

Calls and messages to Vishwas Pathak, independent director of MSEDCL, went unanswered.