When it comes to paying electricity bills, residents of the island city have never had to complain about inflated bills, unlike the residents of the suburbs. Yet, the Brihanmumbai Electricity Supply and Transport (BEST) Undertaking, announced on Wednesday that it has reduced overall tariffs by nearly 5-7 per cent.
Notably, the authority in question has already been incurring losses, and has declared an overall deficit of Rs 689 crore for 2018-19. About 10 lakh consumers will be, however, benefiting of the move.
The new tariff came into effect on September 1, and the reduced amount was reflected finally in the October bills. Those residing in south and central Mumbai — between Colaba to Sion/Mahim — seem to be luckier than their 29 lakh suburb counterparts, who are consumers of Adani Electricity and 6 lakh Tata Power consumers who are paying 0.24 per cent and 2 per cent more, respectively.
Sources in BEST pointed at the two things that they did right, which allowed them to reduce the tariffs. "First, we have saved more than Rs 70 crore by reducing the power purchase cost. Our average procurement cost has come down to Rs 4.69 per unit from the earlier Rs 4.98 per unit," said a BEST official.
The BEST had gone by competitive bidding for signing long-term power purchase instead of continuing with Tata Power. BEST officials said that this gave them the power to bargain. Next, they reduced the operation and maintenance cost on their existing assets, such as, underground cables and substations.
They added they do not charge any 'regulatory asset charge' — a cost which deals with capital expenditure on cables laid. The power experts claim that this was possible after BEST managed to recover it through Transport Division Loss Recovery (TDLR), through which they collected over Rs 2,800 crore.
RJ Singh, Deputy General Manager, BEST Undertaking, said, "We are trying to serve our consumers in the best possible way at the lowest cost".
Meanwhile, Adani Electricity Mumbai Limited (AEML) is on the receiving end as people are furious over inflated bills. For over a week now various political parties are holding demonstrations. On December 6, Shiv Sena will hold one at AEML's Bandra (E) office.
- 10 lakh Total consumers
- Area covered Colaba-Sion/Mahim
- 752 Mw Total consumers