The Maharashtra State Electricity Distribution Company Ltd (MSEDCL) filed a plea before the Maharashtra Electricity Regulatory Commission (MERC), seeking a tariff hike to bridge its revenue deficit in 2011-12 and 2012-13. The hike, however, would be nullified by the subsidy announced by the state government last month.

The MSEDCL supplies power to the entire state except Mumbai, which is serviced by the BEST, Tata Power Company and Reliance Infrastructure Ltd. Certain areas in Mumbai, such as Bhandup, Kanjur Marg, Vikhroli, Powai and Sakinaka, however, get electricity from MSEDCL.

The state electricity distributor has sought a tariff hike of approximately 30 per cent across categories. "Looking at MERC's past record, it generally grants a tariff hike of not more than 20 per cent. Keeping this in mind, the state government had announced a subsidy to keep power tariff down by 20 per cent," said an MSEDCL official.

"Hence, any rise in tariff that the MERC grants will be nullified by the state government's subsidy," he added.

The state government has committed Rs 606 crore per month to MSEDCL in subsidy to avoid any impact of the proposed power tariff hike on the consumers. Besides, the state's power generation and transmission arms will also contribute Rs 100 crore. The subsidy is to benefit 1.97 crore consumers — 1.42 crore domestic, 4 lakh industrial, 15 lakh commercial and 36 lakh farmers.

In September last, the MERC had allowed MSEDCL to hike power tariff to recover Rs 5,400 crore over a period of six months. "However, with the period now drawing to a close, the MSEDCL would have to return to the April 2013 tariff. To avoid that, we have asked for the hike. Effectively, the power tariff from April 1, 2014, will be roughly the same for consumers as it was in April 2013," said the official.

The tariff in April 2013 was Rs 3.36 per unit and Rs 6.05 per unit for domestic consumers up to 100 units and from 100 to 300 units, respectively. For high-tension industrial users on express feeders, which refers to continuous interrupted power supply, the tariff was Rs 7.01 per unit and for those on non-express feeders, it was Rs 6.33 per unit.

Likewise, for commercial users on express feeders, the tariff was Rs 10.45 per unit, while for those on non-express feeders, it was Rs 9.83 per unit.