Following the Supreme Court striking down an appeal against the Tata Group company laying its network in South Mumbai, the power consumers now have Tata Power as an alternative to BEST. Presence of two players in the metropolis is sure to boost competition both in terms of cost as well as efficiency in the commercial capital of the country.
Observers feel moving to Tata will save BEST customers using up to 300 units a month an average of Rs 500. They said for those consuming 500 units, the benefit will be even larger as the difference in Tata and BEST tariffs is nearly Rs 3 per unit.
The BEST appeal had claimed that as it was the local self-government body, it enjoyed the privilege of being the sole distributor in its licence area and no other distributor was allowed there without its permission.
But BEST had managed to get its plea to recover losses from its bus transport business from the power consumers approved from the apex court. The cross-subsidy resulted in BEST tariff skyrocketing, rising Rs 1.16 per unit over the original tariff to become one of the highest in country wide, upsetting the consumers.
The Supreme Court ruled that there was no provision in the statute that gave BEST the privileged position of being the sole distribution licensee in an area. In the order, it said observed no merit was found in any of the contentions of BEST.
The Appellate Tribunal on Electricity had upheld the Maharashtra Electricity Regulatory Commission’s order allowing the Tatas to lay their network in the island city and supply power.
Tata Power called the ruling a “win” for consumers. “This ruling will foster competition and also pave way for customers to avail competitive tariffs and better customer service,” a statement said.