Escoms deliver electric shock to industrial consumers

At a time state governments are relaxing due dates for payment of electricity bills to domestic, commercial and industrial consumers, the Karnataka government is asking its industrial consumers to pay for even unconsumed electricity.

Instead of billing for actual consumption, electricity supply companies (Escoms), on the directive of the Karnataka Energy Department, are taking the average of the past three months' consumption and asking the industrial consumers to pay for the month of March.

In a circular, dated April 3, the Energy Department said: “The Escoms’ day-to-day expenses, majority of which being power purchase dues to the generators, are met out of daily revenue collections from consumers. If the payments from consumers are delayed, Escoms will find it difficult to pay the generators for power purchase and to manage the daily activities. It may become extremely difficult to provide uninterrupted power supply to the consumers.”

The order has come as a shock to a large number of industrial consumers, especially MSME units in Peenya, Bommasandra and other parts of the state, as they had shuttered their factories by the middle of March and were ready to pay only for actual consumption.

"We are ready to pay for the actual consumption for the month of March. We have requested the electricity regulator, KERC, to issue direction to all Escoms not to levy even fixed charges or minimum charges for the month," R Raju, President, Karnataka Small Scale Industries Association (Kassia) told DH.

Raju said it would be difficult for MSME units to pay the full electricity bill when there was no consumption. "Already industries were running below capacity due to global recession. The enforcement of the lockdown following Covid-19 has compounded our woes. Even after lifting the lockdown, it will take at least six months for small industries to reach their normal level of production as all the major automakers and textile industries are virtually closed," he said.

Many states like Punjab, Gujarat and Haryana have already reduced charges and have deferred the due dates for payment of bills. They have even waived payment of fixed charges on power bills for three months. "We request Karnataka to also waive fixed charge on power bills for three months for micro and small industries," Raju said.

In Gujarat, all categories of consumers have been given time till May 15 to pay bills for March and April without levy of delayed payment surcharge. It has also decided not to recover minimum charges/fixed charges from the electricity bill for the month of April from all commercial and industrial consumers.

The Maharashtra Electricity Regulatory Commission has announced a cut in electricity tariffs by an average 8% for the next five years. It also placed under moratorium the payment of fixed charges by commercial consumers for the next three billing cycles since the beginning of the lockdown.