MUMBAI: Monthly electricity bills will rise by up to 20% from this month as power utility firms will levy Fuel Adjustment Charges (FAC) as approved by the Maharashtra Electricity Regulatory Commission from June 1.
It'll be a big burden on 10.5 lakh consumers of BEST, over 7 lakh of Tata Power, 29 lakh of Adani Electricity and 2.8 crore of MSEDCL in Maharashtra.
The minimum hike could be 10% and the maximum 20% across all consumer categories- residential, commercial, industrial, etc. FAC is based on the varying price of fuel or coal/gas. It was not billed to consumers for the past two years during the pandemic.
The rates will vary as per consumer slabs and between power utilities (see box, ), but the average hike will be around Re 1 per unit, said sources.
The FAC is being calculated for March, April and May, and will be collected in 5 months till November. "The first FAC will reflect in the July bill," said a source.
Officials justify FAC, cite high cost of imported coal
MERC sources said the 10-20% increase in power tariffs is as per the regulatory commission allowing power firms to apply for quarterly FAC in electricity bills. It had given the option to BEST, Tata Power, Adani Electricity and MSEDCL to apply for levying FAC for every quarter.
"The cost of imported coal to generate power was high as also the operational costs of gas-based power stations, thereby resulting in FAC being levied," said a senior MSEDCL official. "This problem of expensive fuel (imported coal) is not just of Mumbai or Maharashtra, but has impacted power discoms across the country," he pointed out.
However, consumers are upset. "There was a huge relief for consumers on April 1 as there was no significant hike in power tariff. But the FAC will now pinch our pockets," said Sudha Krishnan, a Vashi resident.
The Adani Electricity spokesperson said: "With increased supply from our 700MW hybrid renewable energy power purchase agreement since August, our dependence on the short-term electricity market has reduced. We are taking additional measures to further reduce cost of power supply, thereby our consumers can expect lower FAC in coming months."
The Tata Power spokesperson said: "According to the new slabs, a majority of Tata Power consumers in Mumbai will still draw cheaper tariff."
During Covid, MERC had directed all power companies to create "FAC stabilising fund" to meet fuel costs. "Now, even if FAC is levied, it will be on a quarterly basis. The regulatory commission will allow recovery of the cumulative amount equally over the next three months," a source from MERC added.
