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Power relief hint: AAP yesterday, Didi today

Mamata Banerjee during the budget speech; Arvind Kejriwal. Picture by Pradip Sanyal

Calcutta, Feb. 17: Mamata Banerjee today plugged into an Aam Aadmi Party formula, holding out the prospect of a cut in power tariff.

However, unlike Arvind Kejriwal who had announced tariff relief for low-end consumers without explaining how he would fund the subsidy, Mamata is banking on savings.

She put the savings at Rs 1,500 crore, suggesting that they will be passed on to the consumers.

Officials said the consumers may already have benefited indirectly since the savings have helped avoid tariff increases. They also did not rule out direct tariff cuts after the polls.

“I don’t want to raise tariff. I am trying to fight it out. We have to stand by the people by not increasing subsidy,” Mamata said in her address at the Assembly this morning.

“By reducing the cost of production, planning and departmental expenditure, we have managed to save around Rs 1,500 crore…. People will have to pay less tariff in 2014-15 than what they did in 2013-14. This is a commoners’ government,” she added.

The proposal to reduce power tariff did not feature in Amit Mitra’s budget speech though.

The current average tariff for power supplied by the state utility to its 1.1 crore customers is Rs 5.93 a unit, excluding a government subsidy of 25 paise on every unit. Those availing themselves of power from private utility CESC in Calcutta and Howrah pay an average tariff of Rs 6.17 a unit.

“We have to strike a balance between industry and domestic consumers. We will distribute it accordingly. At different stages, the value of reduction will be different…. Is it not a big achievement?” the chief minister asked.

Officials in the power department said that by referring to the savings of Rs 1,500 crore, the chief minister was pointing to lower generation and operational costs because of reduced import of coal for generation of power, besides reduction in transmission losses.

“By importing less coal alone, we have been able to save around Rs 800 crore. By reducing transmission losses and departmental expenditure, we will save around Rs 300 crore,” said a senior power department official.

Power secretary Gopal Krishna said his department would do its best to implement the proposal of the chief minister.

According to sources in the state-run distribution utility, the reduced costs had helped avoid tariff hike.

“For the ongoing fiscal, had the state-run utilities not been able to save so much, the tariff could have risen by around 26 paise a unit. That did not happen. On top of that, there could be a reduction in the average tariff in the next fiscal. The details are yet to be finalised, so an exact number cannot be cited,” said a source this evening.

Bengal, however, is unlikely to witness any change in tariff before the Lok Sabha polls as the state power regulator, which takes a call on electricity rates, is yet to get two of its three decision-making members. The state government has been dragging its feet on selecting the successors to Prasad Ranjan Ray, who retired as the regulatory body's chairman in September, and engineer Pranab Gupta, whose term ended in 2011.

The three-member West Bengal State Electricity Regulatory Commission will remain virtually defunct if the two posts are not filled up and key decisions on tariffs cannot be taken in the absence of the majority.

Although the government formed a three-member committee of retired high court judge Amit Talukdar, chief secretary Sanjay Mitra and Central Electricity Authority chairman Ravinder to select Gupta and Ray’s successors three months ago, the selection process is yet to take off.