Only four per cent farmers having metered supply get one per cent of the total subsidy in power tariff. Each agricultural pump-set owners get an annual subsidy of about Rs 14.225 towards electricity charges and the present subsidy works out to Rs 3.210 per horse power (HP) rating of the pumps. "This is highly iniquitous even among farmers with irrigation facilities as it means higher subsidy for farmers with larger capacity pumps."

The domestic consumers too are at present being subsidised to the extent of nearly Rs 500 crore annually. Nearly 75 per cent of these consumers are on single phase and of them 50 per cent are reported to be consuming less than 50 units per month. Another 20 per cent consume between 51-170 units a month. Only 5 per cent consumers use more than 170 units a month.

In successive tariff revisions, the tariff increase for the consumers in the lower slabs has been kept to the minimum. During the tariff revision of 1996, the tariff for the lowest slab of 31-50 units was in fact reduced from Rs 1.05 per unit to 60 paise per unit and for the next two slabs again the rate was kept the same as before. "This defies any logic except of populism. this has increased the burden of subsidy enormously," says the report.

The report stressed the need for the revision of slab structure so that the benefit of subsidy was given to the really deserving and the lowest income group. And even this group must be made to bear a reasonable increase in tariff every time the tariff was revised. All other categories of domestic consumers must be asked to share the burden of increase in tariffs equitably.

On the high tension industrial tariff, the report said that it was already one of the highest, if not the highest in the country. Further steep increase in this tariff will encourage industry to go in for captive power generation and it will substantially reduce the scope for cross-subsidisation. It will have serious long-term implications for the financial viability of the Maharashtra State Electricity Board (MSEB).

TBIA has appealed to the state government that the tariff revision should be done only after the formation of Maharashtra Tariff Regulatory Commission. MSEB has recommended 12.92 per cent hike in the power tariff across the board.

As industry consumed 12,856 million units, the excess charged to them amounts to Rs 1,646 crore. Agriculture consumed 13,867 million units. The loss incurred by MSEB amounts to Rs 2,635 crore. The rate for agriculture was 11 per cent of MSEB cost while the rate for high tension industry was 160 per cent of MSEB cost.