The Maharashtra Electricity Regulatory Commission (MERC) has allowed the state electricity distribution company (Mahavitaran) to recover an accumulated amount of around Rs 1,483 crore from its consumers through monthly energy bills in six equal instalments from June to November.
The Commission in its order said total recovery amount will be Rs 247 crore in each month.
The FAC is the amount that utilities apply on bills based on varying price of fuel/coal. The price of fuel changes every month based on demand and supply and thus cost of producing electricity changes accordingly.
The power generation companies pass on this cost to distribution companies, who thereby pass it on to consumers.
The regulator, in an order, observed that the unprecedented rise in fuel prices and freight rates has resulted in a much higher cost of variable components of the tariff.
"The situation is of extraordinary nature as the costs are showing continuous uptrend. Since last December there has been a 38 per cent rise in the cost of fuel. In such a situation, measures such as 10 per cent cap on recovery will not be adequate.
More From This Section
"These will boomerang on consumers themselves through a financial crippling of both the generating company as well the distribution licensee," it said.
The commission further said the additional amount will be recovered proportionate to the tariff charged to the consumers as per their respective category and slab.