Under-Recovery Necessitates Tariff Revision
Come April, Tata Power consumers in Maharashtra will experience a surge in their electricity bills as the Maharashtra Electricity Regulatory Commission (MERC) greenlights an average tariff rise of approximately 24% for the fiscal year 2024-25, effective from April 1, 2024.
The decision stems from the need to address under-recovery issues resulting from staying on tariff determinations as outlined in the MTR Order for FY 2023-24. According to MERC, had there been no stay, the tariff for FY 2024-25 would have seen a decrease of 13% compared to the approved rates in the MTR Order.
Tata Power’s Response and Consumer Impact
A Tata Power spokesperson commented on MERC’s decision, stating that the revised tariff for FY 2024-25 aims to address past approved gaps up to FY 2023-24, to be recovered within the upcoming fiscal year while remaining within a range of +/- 20% of the average cost of supply. Despite the hike, Tata Power assures that their Residential Tariff for the 0-100 category remains the lowest, with the 101-300 category only slightly higher than rates offered by other private players. Notably, Tata Power had sought a revision in the average price tariff to recover arrears amounting to ₹927 crore. The proposed increase would elevate prices for consumers using less than 100 units to ₹4.96 per kWh, up from the previous rate of ₹1.65. However, Tata Power also proposed a reduction for consumers using 500 units and above, with rates dropping to ₹7.94 from the current ₹8.35 per kWh.
