Tariff heat: Maha hikes ₹1 per unit, Chhattisgarh 20 paise, zero in MP

Nagpur: Many families are startled to see their power bills shooting up in the summer, despite using their air-conditioner as frugally as they had last year even in the scorching Nagpur heat, and so many power plants and coal mines in close proximity. However, it is a fact, as come April the bills do go up as compared to last year for both rich and poor consumers.
The state govt’s electricity distribution arm, MSEDCL, hikes power tariff on an annual basis for a slab of three years each at one go.Since the last financial year, the rates have gone up by 30 paise to over a rupee per unit, depending on the slab of the user.

In the neighbouring states, not more than 100km away, Chhattisgarh in the east also increases the rates each fiscal. In 2024, the tariff for domestic consumers was increased by 20 paise. Madhya Pradesh skipped the annual hike this year. In Ahmedabad, the commercial capital of neighbouring state of Gujarat, which has no coal, the basic domestic rates range from Rs3.20 to Rs5 a unit. The tariff was last revised in 2021.
In Maharashtra, consumers who do not use more than 100 units of power a month have to pay Rs4.71 per unit of power as compared to Rs4.41 last year. Those slightly slightly more (over 200 units) have to shell out Rs10.29 in 2024, an increase of 65 paise per unit since last year. The tariff has gone up by 94 paise and Rs1.07 for consumers using more than 300 and 500 units respectively.
A marked increase in the tariff leads to a tangible rise in the bills as compared to last year. The average rates in Chhattisgarh and Madhya Pradesh are half as compared to Maharashtra. In Madhya Pradesh, basic rates are in the range of Rs4.27 to Rs6.80 a unit. Chhattisgarh charges from Rs3.90 to Rs8.10 per unit.
Chhattisgarh has its own advantages. The biggest is higher and cheaper availability of coal in the state, which is smaller in size, said a source here. Vidarbha is unable to exploit this same advantage, say stakeholders. Madhya Pradesh, on the other hand, resorts to unofficial power cuts, a source said.
Yet, there is enough chance for reducing the tariff in Maharashtra, say stakeholders. Pratap Hogade, president of Maharashtra Vij Grahak Sanstha, an NGO taking up consumers’ issues, claims the tariff is higher in Maharashtra due to inflated consumption figures and suppression of losses.
“Random billing happens for agricultural consumers. Irrespective of the actual usage, farmers are billed for 125 units on average. This helps in showing higher consumption in the sector and farmers are blamed for non-payment,” he says.
The transmission and distribution losses (TDL) are suppressed, he says. Hogade claims that the actual losses must be 30%, which is double what MSEDCL records. TDL is power lost by theft or other technical reasons. The generation cost also needs to be reduced. Rationalisation on all these counts can reduce the tariff by over one rupee, he claims.
Ashish Chandrana, an independent director in the MSEB holding company, who accepts that the domestic tariff is higher, says that the rates may ease next year due to a major push on solar power, which is cheaper. Chandrana said the industrial power rates have been made competitive in the state. Its impact is likely to be seen in the tariff charged from other classes of consumers.