Tata Power consumers to get relief, Adani says lowest tariff claim untrue

Adani Electricity and the BEST may also seek a stay on their tariff. Representation pic/Satej Shinde

The Appellate Tribunal for Electricity (APTEL) has stayed the determination of Tata Power Company's (TPC) tariff for the year 2023-24, thus granting a benefit, albeit temporary, to the company's 7.5 lakh consumers, who were worried about an exorbitant hike in their monthly bills.

In the interim period, the tariff proposed by the company to the Maharashtra Electricity Regulatory Commission (MERC) on March 31, 2020, becomes applicable once again, according to TPC. This tariff is 25-35 per cent lower than the existing one and will be for the benefit of the consumers.

The higher tariff gave TPC's close competition, mainly Adani Electricity, an advantage because in the city, the consumers migrate to the utilities that charge less. In this case, Adani's tariff is less. TPC's commitment of imposing the previous lower tariff triggered a strong reaction from Adani. Many in Adani termed the stay unprecedented and claimed it impacted the competitive landscape between Mumbai companies.

TPC argued that the MERC order in March was actually detrimental to the competitive business because in its petition it had not sought any hike, and yet the commission had increased the tariff beyond expectations. It was the reason the MERC order was challenged before the tribunal.

TPC said in a statement on Friday that it will continue to bill consumers as per previous rates that were approved by the MERC. It said the stay had vindicated its stand that it can offer cheaper electricity to Mumbaikars.

Sanjay Banga, president of TPC (transmission and distribution), said, "The interim stay is a testament to our 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 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 TPC's Mumbai distribution, told mid-day that the company will submit its further say at a hearing on October 16. "APTEL is convinced about the anomalies in the MERC order that we had pointed out. The commission will also submit its say, if any, in the hearing," he said, expressing confidence that TPC would get a final verdict as well.

"The stay represents a pivotal opportunity to strengthen our commitment, ensuring the delivery of quality, affordable, sustainable and reliable power supply that benefits both customers and the wider community," he added.

Meaningless claim: Adani

Commenting on the development, an Adani Electricity spokesperson said in a statement, "Suo moto claims of the lowest tariff are meaningless and designed to misguide (the consumers). The stated tariff is temporary as it excludes FAC (fuel adjustment charge) of Rs 1,200 crore for the past period. The stay is subject to final hearing in October."

He added that the stay of any tariff is against consumer interest as it poses an additional interest burden.

The argument is that since the tariff now applied for TPC is the basis cost determined in March 2020 and the same costs have more than doubled currently, the consumer should be paying a hefty FAC.

"Adani Electricity tariff is reflective of current costs and includes all past periods under recovery and will not pose any interest burden on consumers and thus shall maintain certainty and competitiveness," said the spokesperson, attempting to convince consumers that his company's supply will come at lower rates than that of TPC.

Others to intervene?

Industry sources said Adani and the Brihanmumbai Electricity and Transport (BEST) undertaking may also intervene in the matter and ask that their tariff be stayed as well. They said if a similar yardstick was applied, then, tariffs of all Mumbai companies might be revised downwards.