Will Maharashtra Reduce Electricity Tariff by 10% for Mahavitaran Consumers from July 1?
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Synopsis
Maharashtra's Mahavitaran to implement a 10% electricity tariff cut for low-usage domestic consumers starting July 1. This strategic move aims to ease the financial burden on households while providing a political edge ahead of local elections.
Key Takeaways
- 10% tariff reduction for domestic consumers using up to 100 units.
- Marginal reductions of 1% to 3% for larger consumers.
- Political implications ahead of local elections.
- Future plans for a significant increase in electricity supply.
- Focus on renewable energy and affordability for consumers.
Mumbai, June 25 (NationPress) — The electricity tariff for domestic consumers of the Maharashtra State Electricity Distribution Company (Mahavitaran) who use up to 100 units per month will see a 10% decrease starting July 1. Additionally, a slight reduction of 1% to 3% has been implemented for middle-class domestic, commercial, and industrial consumers using more than that.
The Maharashtra Electricity Regulatory Commission (MERC) has issued an order favoring a reduction in electricity tariffs across all consumer categories for the next five years.
This tariff reduction is anticipated to provide political advantages to the MahaYuti government ahead of the local body elections.
Over the coming years, the state is expected to benefit from a significant supply of affordable electricity through solar power projects, projected to cost around Rs 3.50 per unit, leading to phased reductions in tariffs across various categories.
The Commission had revealed new electricity tariffs effective from April 1 on March 29. Mahavitaran had reported a deficit of Rs 48,000 crore and sought revenue adjustments, but the Commission estimated a surplus of Rs 44,500 crore instead.
Despite Mahavitaran's concerns regarding financial strain, the Commission has revised its previous order, ultimately approving Mahavitaran's requests for consumer relief through tariff cuts. This reduction will occur in phases for all consumer categories.
“For the first time ever, Mahavitaran has proposed a reduction in electricity tariffs. The order specifies that household customers installing smart meters will receive an additional 10% TOD (time of day) discount for daytime electricity usage, and households generating solar energy will be promoted. With the Mukhyamantri Saur Krishi Vahini Yojana, 16,000 MW of electricity will be accessible at an average rate of Rs 3 per unit. The scheme aims for completion by December 2026 and is crucial in lowering Mahavitaran's electricity procurement costs while benefitting farmers,” stated Mahavitaran in a release.
To meet future electricity demands, Mahavitaran has signed power purchase agreements for 45,000 MW, aiming to elevate the state's electricity supply capacity to 81,000 MW by 2030. Out of this, 31,000 MW will come from non-conventional sources. This affordable electricity is projected to save Mahavitaran Rs 66,000 crore in procurement costs over the next five years, which motivated the proposal for tariff reductions, as per the release.
Mahavitaran CMD Lokesh Chandra remarked, “The MERC's decision marks the first-ever reduction in electricity tariffs based on Mahavitaran's petition. This will not only ease the burden on domestic consumers but also enhance the industrial sector. Previously, industrial and commercial electricity tariffs rose by 10% annually; now, they will decrease over the next five years. Aligning with the Prime Minister's vision, this tariff reduction aims to help the state achieve a trillion-dollar economy under CM Devendra Fadnavis’ leadership. Mahavitaran is committed to delivering quality electricity at affordable rates.”
For more information, contact Sanjay Jog at sanjay.j@ians.in
Point of View
It is evident that the Maharashtra government is taking steps to alleviate the financial burden on consumers. This decision, while politically advantageous ahead of elections, underscores a broader commitment to energy sustainability and affordability for all residents. The phased implementation of tariff cuts, alongside investments in renewable energy, reflects a strategic approach to meet future demands while prioritizing consumer interests.
NationPress
25/06/2025
Frequently Asked Questions
When will the new electricity tariff rates take effect?
The new electricity tariff rates will take effect from July 1.
Who will benefit from the 10% tariff cut?
Domestic consumers using up to 100 units of electricity per month will benefit from the 10% tariff cut.
What other reductions are being made for larger consumers?
Middle-class domestic and commercial consumers consuming more than 100 units will see a marginal reduction of 1% to 3%.
How does this decision affect the local elections?
The reduction in electricity tariffs is expected to provide political advantages to the MahaYuti government as local body elections approach.
What future plans does Mahavitaran have for electricity supply?
Mahavitaran plans to enter power purchase agreements for 45,000 MW to increase the state's electricity capacity to 81,000 MW by 2030.
