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KSEB set for steep hike in Power Tariff

Kerala is likely to announce a steep hike in electricity charges with the State Electricity Regulatory Commission apparently giving the go-ahead for the proposal. The State Electricity Board may be allowed to revise tariff upward by up to 40 paise a unit to generate incremental revenue of an estimated INR 800 crore, according to Government sources.

Order soon

The official declaration will be made soon. The impact will be variously felt across categories of consumers drawn up on the basis of consumption pattern. This is in response to the tariff revision proposals submitted by the Board in May along with the petitions on Aggregate Revenue Requirement and Expected Revenue from Charges (ARR&ERC) for the year.

The ARR&ERC statement for 2014-15 had projected a revenue gap of INR 2,931 crore. The Board had proposed to raise INR 1423.20 crore through steep tariff revision across the 20 categories of consumers.

Had the regulator worked solely on the basis of the projected revenue gap, the hike in tariff would have amounted to as high as 70 paise per unit, sources said.

But the Commission allowed the Board to raise a maximum of only INR 800 crore through tariff revision, and raise the rest through other avenues.

Focus on subsidy

The Board has been strictly advised that high-income consumers should not be allowed to take advantage of the subsidy luxury anymore. The Commission has reportedly asked it to redefine the criteria for charging INR 1.50 per unit for those consuming less than 40 units per month.

This is because flats and palatial residential buildings lying vacant have been found using this special rate on the sly to derive undeserved benefit. The Commission estimated that there are at least eight lakh such buildings in the State. The special rate should be strictly made available to families below the poverty line alone.

The Board had hoped to confine the ‘telescopic’ pattern of tariff for domestic consumers to 200 units. Consumption above that ceiling would cost the same from the first unit to the last. Last time, the ceiling for telescopic tariff had been pegged at 300 units.

Hike rates

In the domestic category, the board proposed no change in tariff for the 0-40 (units) slab. But the 0-80 and 81-120 slabs has been replaced by the 0-100 and 101-200 slabs.

Fixed charges for domestic consumers are also to be hiked. For single-phase connections above 40 units, the Board proposed a hike from INR 20 to INR 30 and for three-phase, from INR 60 to INR 80.

Source-On Request