To get concession up to Rs2 per unit, maximum benefit to Vidarbha-based companies
A day after proposing to impose 9% duty on industrial and commercial consumers who switch from state discom to Open Access and Captive generation to get cheaper electricity, Maharashtra government on Wednesday has slashed the power tariff for industries in Vidarbha, Marathwada, North Maharashtra and some parts of western Maharashtra.
Industries in these under-developed regions will get concession up to Rs2 per unit. The move would cost Rs1,000 crore to exchequer annually towards subsidy to be given to the state distribution utility, MahaVitaran (MSEDCL).
The concessional rates will be effective from April 1, 2016 and continue for three years which will coincide with the end of the Fadnavis government's term. The maximum concession has been offered for Vidarbha region to which chief minister Devendra Fadnavis and energy minister Chandrashekhar Bawankule belong.
Announcing the incentives, Bawankule said that with the fresh initiative industrial tariff in the state could be as low as Rs4.00-Rs4.25 including 26% incentives already offered by Maharashtra Electricity Regulation Commission.
"That means our power would be cheaper than Chhattisgarh now," said Bawankule. At present, the industrial tariff is around Rs7.5 per unit. Several industry bodies had cited higher industrial tariff in Maharashtra compared to neighboring states as a major roadblock.
Differential concessions have been offered based on the region. For example, new industries in Vidarbha and Marathawada would get concession of 75 paise per unit while industries in north Maharashtra and D and D plus zone would get 50 paise relief per unit.
For existing industries which are in low transmission category, relief would range from 10 paise to Rs1.65 per unit depending upon the load factor and region. For high transmission companies, concession would be 5 paise to Rs1.52 (continuous supply) depending up on region and for non-continuous it would be 5 paise to Rs1.12.
Fuel adjustment cost, 90 paise now, has been brought down to 30 paise in Marathwada, 40 paise in Vidarbha and 20 paise in North Maharashtra. Experts said that Vidarbha and Marathwada region already get exemption from 9% electricity duty.
The move is believed to be a major boost to industries in backward and drought-prone regions of the state. This would help the government to woo investors including FDI to set their shops in the state.
The fresh concession would narrow the gap between the tariff offered by the state utility and Open Access. Over 500 of them had left the state discom and switched to Open Access to make their production affordable. Open Access power offers Rs1.5 to Rs2.0 cheaper power to industries compared to state discom whose tariff is more than Rs8.3 at present.
On asking why doesn't state offer concession for all across the state, Bawankule said that would require Rs800 crore more.
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