States losing industrial power consumers

Maharashtra has lost about 200-250 industrial electricity consumers over the last few years.

These industries have shifted to either neighbouring states or are taking power from private companies due to the high electricity tariffs of the state’s generation company. Most of the industries that have moved were consuming more than 1 mw. The state is worried that its power generation company Mahagenco’s role might be reduced in the future as private companies have been making power available to industries for cheap.

“We have so far lost about 200-250 industrial units from the consumers’ list due to the high power tariff. As the consumers can now opt for open access electricity, there is an apprehension that we would lose more industrial consumers,” an official from the energy department confirmed the development. In order to keep the industries with the Mahagenco, the official said that the government has announced to reduce industrial power tariff in backward Vidarbha and Marathwada region. However, the decision is yet to be implemented.

The state has a 25 per cent higher tariff than the neighbouring Karnataka, Gujarat, Andhra Pradesh and Madhya Pradesh. The power tariff has posed a challenge before the government while inviting industries. To reduce the tariff, the Centre has recently given its approval to measures like coalmine swapping, which enables the state to get coal from the nearest mines, saving on travelling expenses, the official said.

The government can offer lower tariff to residential consumers as it charges industries higher rates. But if it were losing more industrial consumers, the subsidy to the residential consumers would be reduced, causing a tariff hike for residential consumers. “Yes, this might happen if we are not able to hold industrial consumers and lose them to private companies,” another official from the energy department said.

The average cost of supply in Maharashtra is the highest at Rs 6.75 per unit.