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West Bengal State Electricity Distribution Company Limited (WBSEDCL) is likely to hike the power tariff by 20 paise from next month on the back of the recent increase in price of higher grade of coal.
Incidentally, this would be the fifth hike in power tariff effected by Mamata Banerjee-government, which, otherwise, has been most vocal against Centre's "anti-people decisions" like hike in fertiliser and fuel prices.
The Trinamool Congress government has so far effectively increased the power tariff by 26% and with the implementation of the current proposal the increase would be by 30% over the last two years.
"Hike in power tariff is certain. Although there is a hike in higer grade of coal and decrease in lower grade coal, this has led to increase in production cost. We finalising the impact. But roughly there is going to be about a 20 paise increase in tariff," said a top government official.
Coal India recently increased prices of low grade coal by up to 11 percent and slashed prices of premium quality coal by 12 percent. Apart from state's power generation company West Bengal Power Development Corporation (WBPDCL), the state-run West Bengal State Electricity Distribution Company Limited (WBSEDCL) source power from NTPC and DVC.
The hike is likely to be effective from next month with imposition a monthly variable cost adjustment (MVCA) of 20 paisa for its customers effective from current billing cycle, taking the average tariff for its customers to Rs 6.13.
The monthly variable cost adjustment was introduced last year as per West Bengal Electricity Regulatory Commission (terms and conditions of tariff) Regulations 2011. Under the MVCA concept, tariff is being adjusted on a monthly basis based on changes in cost factors. The provisional MVCA, however, is subject to approval of West Bengal Electricity Regulatory Commission, by the end of financial year.
This is going to be the sixth increase in tariff since the Mamata Banerjee government too over in May, 2011.While the first increase was from Rs 4.27 per unit to Rs 4.71 per unit, was a decision of previous government, the Banerjee government has allowed four hike so far over the last two years taking the average tariff from Rs 4.71 to 5.93. The last hike in power tariff was implemented in January, 2013.
This means, with the implementation of the current proposal, the effective increase in the power tariff by the Mamata Banerjee government will by Rs 1.44 (Rs Rs 4.71 to Rs 6.13).
WBSEDC, however, see this as a welcome change in Mamata Baneerjee- led government approach.
"State government seems to be realising the need to increase tariff. The approach is more realistic now," an official in the state power utility said.
