CONSUME MORE, PAY LESS: PSERC MOOTS 2SLAB TARIFF

Punjab State Electricity Regulatory Commission recommends ₹3.5 per unit rate from powerintensive industry; tariff for domestic, commercial consumers likely to be hiked

The Punjab State Electricity Regulatory Commission, the sector regulator that also fixes tariffs for the vital resource, is expected to announce rates that broadly follow a two-slab rule. The new formulae would come into effect only for industrial consumers. Other segments like domestic and commercial consumers will migrate to the new tariff gradually. ››

CHANDIGARH: The Punjab State Electricity Regulatory Commission (PSERC), the sector regulator that also fixes tariffs for the vital resource, is expected to announce rates that broadly follow a two-slab rule, soon.

The principle of ‘higher the consumption of a consumer, the lower would be tariff,’ would be followed, a source claimed, adding that initially the new formulae would come into effect only for industrial consumers.

Other segments like domestic and commercial consumers will migrate to new tariff gradually.

Notably, the tariff for the current fiscal that began on April is expected to be announced by October 15.

The details of the rates to be charged as per consumption are being worked out.

The lowered rates, if implemented, will benefit the entire industry, but around 15% of the industry that falls in the highconsumption bracket will gain the most.

Top officers in Punjab State Power Corporation Limited (PSPCL), the power utility in the state, said that two-part tariff was best suited to the power surplus scenario, as it would lead to increase in consumption.

DOMESTIC USERS TOCOMPENSATE FORSHORTFALL

To compensate for the shortfall arising from the industrial con- sumers, the tariff islikely to be increased for domestic and industrial consumers, despite the fact that domestic consumers inapublichearingbythePSERC demanded reduction in power tariff.

The regulator can’t increase tariff for agriculture pumpsets beyond a limit because the sec- tion is subsidised and the state government pays for it.

EFFECTIVE COST FOR SECTIONS OF INDUSTRY TO GOBELOW ₹5/UNIT

After the rates are announced, the cost of power for industrial consumers — particularly large consumers — such as arc furnaces will come down to between ₹3.5 and ₹4 a unit.

In its poll manifesto, the Congress had announced power to industry at ₹5 per unit.

Some states like Gujarat and Maharashtra have already implemented the two-slab tariff system.

Industry consumes nearly 15,000 million units annually (of total 45,000 million unit power consumption in state) and subsidising the sector as per this new formula will cost at least ₹4,500 crore.

If one adds the subsidy bill of ₹6,000 crore for free power to 13.5 lakh agriculture pumpsets and SC consumers, the total subsidy bill would touch ₹10,500 crore.

INDUSTRY CONSUMES NEARLY 15,000 MILLION UNITS ANNUALLY OF TOTAL 45,000 MILLION UNITS IN THE STATE