It shall be due to an interim order from the autonomous body known as the Appellate Tribunal of Electricity (APTEL), a minimum of 750,000 Tata Power customers in Mumbai will experience a reduction of 25-35 percent in their electricity bills compared to their current rates. APTEL is responsible for hearing appeals against decisions made by the adjudicating officer or the Central and State Electricity Regulatory Commissions under the Electricity Act of 2003.
Tata Power’s Appeal Granted for Temporary Suspension of High Tariffs, aims to Retain Customers in Mumbai
In May, Tata Power approached APTEL to request a temporary suspension of the multi-year tariff (MYT) for the years 2023-24 and 2024-25, which had been established by the Maharashtra Electricity Regulatory Commission (MERC). Tata Power argued that MERC’s tariffs were unreasonably high. APTEL has granted Tata Power’s appeal, and as a result, the 2020 tariff order issued by MERC will be temporarily applicable to Tata Power until APTEL reaches a final decision.
While it is uncommon for a private company to publicly assert that the cost of its product—in this case, electricity—has been evaluated at an excessively high rate, sources suggest that Tata Power pursued this petition to prevent its customers from switching to other power distribution companies in Mumbai, such as Adani Electricity Mumbai Ltd (AEML) and BEST. MERC’s tariff order had established AEML’s power tariffs as the lowest in Mumbai, while Tata Power’s rates were the highest. Consequently, customers began to migrate from Tata Power to AEML, with AEML receiving at least 3,000 applications for migration from Tata Power customers in the months of April, May, and June following the issuance of the multi-year tariff order by the state regulator.
Tata Power’s Tariff Relief Benefits Consumers in Mumbai, Strengthens Commitment to Affordable and Sustainable Electricity
AEML holds more than a 50 percent market share in power distribution in Mumbai and has a significant proportion of renewable electricity, resulting in lower costs associated with power procurement.
During the interim period until APTEL reaches a final decision, the tariff proposed by Tata Power to MERC on March 31, 2020, has once again become applicable. This tariff is 25-35 percent lower than the current one and will benefit the consumers, according to a statement by Tata Power.
Sanjay Banga, President, Transmission and Distribution at Tata Power, said, “This interim stay is a testament to Tata Power’s dedication to delivering affordable electricity to the people of Mumbai. It validates our commitment to providing sustainable power at cheaper rates, and our customers will directly reap the benefits of this decision. We will ensure that the relief granted by the APTEL is passed on to our 7.5 lakh consumers, further reinforcing our steadfast commitment to fairness and affordability in all our operations.”
Nilesh Kane, Chief of Mumbai Distribution, Tata Power, said, “With a commitment to excellence, Tata Power has long been recognised for its dedication to providing power at highly competitive rates in Mumbai. Serving over 7.5 lakh customers in the city, the company’s customer-centric approach remains the cornerstone of its operations. Hon’ble APTEL’s Order represents a pivotal opportunity to strengthen this commitment, ensuring the delivery of quality, affordable, sustainable, and reliable power supply that benefits both customers and the wider community.”
