MERC perks up Reliance users, takes load charge off their back

MUMBAI: Maharashtra Electricity Regulatory Commission (MERC) has reversed the controversial load management charge (LMC), thus sparing the consumers of Reliance Energy from penalty for high usage. The MERC order says LMC has caused unintended hardship and severe economic penalties, and thus directed REL to discontinue the levy of LMC and load management rebate (LMR) in all future bills.

In cases where LMC has already been collected, the amount will be adjusted in the subsequent bills of the consumers. The LMR benefit received by consumers will also be adjusted. REL will implement the order in its November bill.

In its new order, MERC insisted on the need for energy conservation in Mumbai to avoid breakdown in electricity distribution. “Commission believes that the overall objective of energy conservation can be achieved only through public participation and sensitisation of consumers towards the urgency of the matter. Hence, the commission may initiate separate regulatory proceedings,” said MERC. Three applications challenging the LMC had come up before MERC.

In its tariff order of October 2006, MERC had recommended levying LMC on residential and commercial consumers who consume electricity in excess of 80% of their bill of the corresponding period of the previous year between October 2006 and May 2007. MERC had also come out with a clarification on November 9 exempting certain categories of consumers from the LMC.

But the order had sparked a series of protests and agitation, which compelled REL to withdraw the additional charge.Since Mumbai was likely to face a power shortage in the summer months, MERC had imposed LMC to curb excessive use of electricity. The LMR was introduced to encourage its economic usage.