The Telegraph
Since 1st March, 1999
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Mrinal blasts rate hike

Calcutta, May 28: The state government today came down heavily on the West Bengal Electricity Regulatory Commission and said the new CESC tariff structure will be a burden on low- and middle-income consumers.

The new rates drawn up by the panel come into retrospective effect from April 1, 2004.

Power minister Mrinal Banerjee termed the trend of the CESC’s tariff structure “worrying”. “We find that the bulk consumers will have to pay less, while those consuming up to 100-150 units per month will have to cough up more than they paid earlier. We are unhappy and worried,” said Banerjee.

“We are still in the dark about what is in store for the (West Bengal) State Electricity Board consumers. But we are concerned over the trend as it emerges from the tariff structure in CESC-served areas,” he said.

However, the state government is not in a position — because of an acute financial crisis — to provide subsidy to those affected by the CESC tariff hike.

The government is also not considering moving court. “If we move court, things will become more complicated and consumers in the long run will be burdened by more arrears,” the minister said.

Banerjee also shot off his first letter to the Union power minister P.M. Sayeed today informing him that the Bengal government will shortly propose amendments in the Electricity Act, 2003, which says cross subsidies would have to be phased out.

“The amendments that will be proposed will focus largely on the roles of the state governments and the relation between the state governments and the SERCs concerned, particularly in the matter of tariff regulation and reduction of cross subsidies in the interest of the poor,” Banerjee said in his letter.

The letter also pointed out that a review of the Electricity Act, 2003, featured prominently in the common minimum programme adopted by the new government at the Centre.

Banerjee argued that while the Electricity Act and the national policy are targeted at providing power to every household, poorer consumers are expected to pay more.

“Clearly there is an anomaly here and it is further heightened in the case of rural electrification, where all the responsibilities of supplying electricity to rural areas are with the respective state governments, yet no specific powers have been given to state governments.”

The state government has always reacted whenever tariff for low- and middle-income consumers has been hiked.

Observers point out that the Left government had always come up with “politically correct” reactions whenever the poor have been affected by power tariff revisions by the SERC, though it realises that incentives will have to be given to bulk industrial consumers if the state wants to woo industries.

“The government knows that if the big industrial consumers are burdened with high tariff rates, they may be prompted to build captive power stations. However, it has to speak in favour of the poor and the middle class to keep its vote bank intact,” said an observer.

Power department sources said, according to market principles, a bulk consumer should always get a better deal than those buying in small amounts. “This is a global phenomenon and Bengal cannot remain outside it,” said an official.

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