MERC stays its own order on Reliance power tariff

Mumbai: In an unprecedented move, the state power regulator has stayed its own tariff order that allowed Reliance Infra (earlier known as Reliance Energy) to hike the electricity charges by seven per cent for residential consumers from July.

The Maharashtra Electricity Regulatory Commission (MERC), which was asked by the state government to review the power tariff structure of Reliance Infra after strong protests from political parties last month, has now asked the company to charge the customers as per the 2008-09 tariff.

MERC, in a statement put on its website said, "Considering the special circumstances and the direction to the commission to undertake detailed investigation on metering, power purchase expenses and transactions undertaken by Reliance Infra as also its capital expenditure, the tariff increase as approved by the commission is stayed."

Meanwhile, State Energy Minister Sunil Tatkare on Wednesday said that MERC would be inspecting the energy meters installed by the company and the inspection would be carried out by a national level laboratory or a national institution.

The commission has said the stay holds good for six category of consumers, including the residential. While the tariff order has not been stayed for certain other categories where the charges were reduced.

Reliance Infra had asked for a hike of 18 per cent in its submission to the MERC but was approved a hike of only about seven per cent. The new rate was to be Rs 5.56 per unit for those consuming 100 to 300 units per month.

The power company concerned in its submission every year tells the regulator about its revenues requirement, its expenditure, capital investment and arrives at its own tariff projection. However, the commission may or may not agree with the company version and the tariff finally determined by the commission has to be followed.

The government version is that some of the expenses, charges and investment made by Reliance Infra and factored in by the commission while granting a hike to the company need to be revisited.

Meanwhile, all eyes are now on MERC's tariff order in case of the Maharashtra State Electricity Distribution Company Ltd, which supplies power to the entire state barring Mumbai.

MSEDCL had asked for a tariff hike of about 35 per cent. The tariff order for MSEDCL is expected over the next few days.