AAP effect: Maharashtra cuts power tariff by 15-20%

Following Delhi chief minister Arvind Kejriwal’s move to cut rates by up to 50 percent, Maharashtra Cabinet on Monday cleared a reduction in power tariff by 15 to 20 percent across agriculture industry and domestic consumers.

The power tariff has been cut throughout Maharashtra, except Mumbai. However, a power tariff cut in Mumbai isn’t entirely off the table. A government official told Mint that the cabinet will next week discuss ways in which this can be done.

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The state Cabinet has taken the decision on the lines of the report submitted by Maharashtra Industries Minister Narayan Rane-led group of ministers (GoM).

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Last Monday, hundreds of Congress workers led by Mumbai MPs Sanjay Nirupam and Priya Dutt protested outside the Kandivali West office of Reliance Energy, the Anil Ambani-owned power company that provides electricity in their constituencies.

The Congress leaders have been demanding a reduction in electricity tariffs like the one announced by the new Aam Aadmi Party government in Delhi.

Union Minister of State for Shipping Milind Deora on Sunday had also demanded a “white paper” on power tariffs in Maharashtra to study how subsidies are provided. “I feel that there has to be a white paper before discussing reduction of power tariffs in the state as it will help in understanding how subsidies are given,” Deora, the Congress MP from Mumbai South had said.

Demanding the need for a scrutiny of subsidies provided, he had said, “Subsidy means that the money will be diverted from one pocket to other. The white paper on power tariff will help to understand this mechanism.”

Though the Maharashtra cabinet’s move may be celebrated by many, it will burden the state’s exchequer by aroundRs 7,000 crore a year.