Power tariff for the consumers of the Damodar Valley Corporation (DVC) will go up with effect from September 1. Necessary notifications are being issued for giving the consumers the statutory 90-days notice.
The basic tariff is being raised by 11 paise - from Rs 2.39 to Rs 2.50 a unit. There is also the element of 26 paise fuel surcharge. Together, the DVC power will be priced Rs 2.76 a unit.
However, there will be important exceptions. As the co-owners of the corporation, Bengal and Bihar had been enjoying a concession of 10 per cent on the basic tariff. This is being raised to 15 per cent.
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As a result, the two State Electricity Boards (SEBs) of Bihar and West Bengal will pay a lower tariff. In place of Rs 2.15 a unit, they will pay 2.13 a unit only.
The fuel surcharge remains unchanged.
However, for the first time in DVC's history, a special concession is being given to the Usha Martin Steel (formerly, Bihar Alloy Steel) which will pay for the power at a consolidated rate of Rs 2 a unit against Rs 2.76 for others.
The unprecedented concession has been given at the insistence of the union ministry of power, said sources. The ministry argued that the steel unit which is now closed after falling sick. The unit will re-open soon. It needs help from all quarters. Concessional rate of tariff is one such assistance.
However, the concessional rate will be given for one year only after which normal rates of tariff will apply for the unit. Earlier, the contract demand was 30 mva. It has now been reduced to 10 mva only.
However, DVC sources fear that the unusual gesture will open the floodgates for similar demands from other industrial units who may fall sick. Some of DVC's industrial consumers are not doing well and have already been referred to the BIFR. They may also ask for a similar concessional tariff.
DVC officials are yet to calculate the loss it is going to suffer by granting this concession of 76 paise a unit of energy. The corporation's board was forced to take the unpleasant decision at the insistence of the ministry of power.
The decision to hike the concession to the two SEBs from 10 to 15 per cent will also affect the corporation's revenue. The Usha Martin Steel case will further erode the earnings. The tariff hike, therefore, will not be as beneficial as it may look in the face of it.