Will levy electricity duty on firms: Chandrashekhar Bawankule

Worried about exodus of industries from the state power generation company to the open access grid, energy minister Chandrashekhar Bawankule said that an Act would be brought in to levy electricity duty (ED) on the industries as a penalty.

The Act would be introduced in the coming monsoon session of the legislature, as the state has already lost business of about Rs 5,000 crore due to the exodus. The Asian Age on Wednesday published a story on the state losing over 500 industrial consumers, who shifted to open access.

“It is true that over 500 industrial units have shifted to the open access grid and we have lost about Rs 5,000 crore. We are going to introduce a bill in the legislature this monsoon to prevent industries from abandoning the use of power from the state generation by imposing electricity duty (ED) on them,” Mr Bawankule told The Asian Age. The government will recover its cost from the electricity duty imposed as per the proposed bill. However, the minister refused to divulge more details about the bill, as it will be presented in the legislature soon.

Consumers had started shifting to the open grid from 2012, after the Centre allowed change of supplier in the Electricity Act 2003. The open grid allows consumers of 1 megawatt (mw) and above to buy cheaper power from other companies in the market. The shift of consumers is ironic for the state when it has declared a cut in power tariff for those interested in setting up industries in Vidarbha and Marathwada.

Activists in the field have raised questions as to how the ED would prevent consumers from shifting to open access.

“There is nothing wrong in implementing electricity duty on consumers. But how will it serve the purpose Consumers are currently being charged ED, which is different for different users. One has to stop the consumers from going into open access by giving cheaper power,” Pratap Hogade, convenor of Veej Grahak Sanghatana, said.

The state sells its power at Rs 8 per unit; while on open access, it is Rs 5.5-Rs 6 per unit. The high power tariff is also causing the state to have surplus power.

“It is true that the state has surplus power. We generate about 17,500 mw of the power and demand is about 12,000 mw. We are ready to send it to open access for other users but other states are also having surplus power,” the minister said, indicating that the state-run generation company had to bear the losses. In one instance last week, power was available for as cheap as 80 paise per unit during the night, he added.