MUMBAI (Reuters) – The Maharashtra State Electricity Distribution Company will raise power tariffs in the state by 16.48 percent due to high costs and rising fuel prices, the state’s electricity commission said on Thursday.
The revised tariffs will come into effect retroactively from August 1.
Maharashtra joins a growing number of state distributors including those in Tamil Nadu, Delhi and Punjab, that raised tariffs in 2012.
Most distribution companies in India’s beleaguered power sector are in dire financial health as populist state governments make it difficult for them to set tariffs that reflect costs. They are also hit by power thefts by the public and inefficient billing.
In July, India said it was considering a bailout for state electricity distributors, which are saddled with 1.9 trillion rupees in debt and increasingly unable to pay for new supplies as they sell power below cost.
Many finance the gap between their revenues and costs by debt funding from banks.
India was hit with a blackout two days in a row at the end of July when three of India’s five transmission grids collapsed, cutting power to states where some 670 million people live.
The current increase has been approved only for the Maharahstra State Electricity Distribution Company, which distributes power to most of the state, excluding Mumbai city.
(Reporting by Rosemary Arackaparambil; Editing by Alison Birrane)