Rising electricity bill will shut factories: Industry bodies

The power tariff hike has evoked strong reactions from industry bodies with the Federation of Karnataka Chambers of Commerce and Industries (FKCCI) warning that many industries will shut down if the revision isn’t rolled back.

The Karnataka Electricity Regulatory Commission (KERC) on Wednesday revised the electricity charges for all consumers, with the hike for commercial and industrial units set at 25 paise per unit.

The Karnataka Small Scale Industries Association (Kassia) said it was “shocked” by the announcement.

“The impact of the hike will be particularly disastrous for MSMEs as they struggle to revive operations amid the pandemic and a severe slowdown in the economy. We had actually urged the KERC at tariff hearings to reduce the rates,” it said.

Perikal M Sundar, president, FKCCI Bengaluru, noted that an average hike of 40 paise per unit in Bescom limits might appear insignificant but it translates into huge power bills for industries.

He warned that the tariff hike would derail government efforts to formulate investment-friendly industry policies, usher in sectoral reforms to attract investment and create jobs.

According to Sundar, 15-20% of industries have shut operations and a lot of employees have lost jobs. Many industries are running at just 40-60% capacity, he said.

“The FKCCI demands the government to order the KERC to withdraw the hike immediately and not raise it for the next three years due to the pandemic,” he added.