The electricity tariff proposal for 2017-18 was submitted to the UP Electricity Regulatory Commission (UPERC) on Tuesday. (Reuters)

The Uttar Pradesh Power Corporation (UPPCL) has sought a hefty hike in power tariffs for 2017-18 — of between 260% and 350% — across rural and urban households and 60% for farmers. With industry spared altogether and commercial establishments tipped to see an average rise of 15%, the average increase in tariffs for the state would be 22.66%. The gap between the revenues and the cost of power supply in the state is relatively high. While the cost works out to be Rs 7.22 per unit for 2016-17, the average blended revenue is around Rs 5.15 per unit, leaving a gap of Rs 2.07 per unit.

The revenue is Rs 2.17 a unit, Rs 0.78 a unit, Rs 3.47 a unit and Rs 6.15 a unit for a rural household, an unmetered agricultural user, an urban lifeline consumer and an urban household, respectively. The state’s aggregate technical and commercial (AT&C) losses are in the region of 30.21%. Losses incurred by the states discoms in 2015-16 were Rs 7,689 crore while these came down to Rs 6619 crore in 2016-17, a drop of 14%. The UP government issued bonds for Rs 49,510 crore under the UDAY scheme.

The state has thus far attempted to narrow the gap between the cost of supply and average revenue realisation by cross-subsidisation. The average revenue assessed from commercial, SMEs and heavy industries has been higher at Rs 7.64 a unit, Rs 8.44 a unit and Rs 7.49 a unit, respectively.

However, apprehensive industries will move out of the state, the government has chosen to proposes steep hikes for other categories of users including a raise of 260% to 350% for unmetered rural households and a 60% increase for farmers’ unmetered tubewells. The corporation has also sought a 150% hike for metered rural consumers; for urban consumers, it has proposed an average hike of 12% depending on the monthly power consumption.

The electricity tariff proposal for 2017-18 was submitted to the UP Electricity Regulatory Commission (UPERC) on Tuesday. The corporation has not proposed an increase in tariffs for industries though the hike proposed for all commercial establishments is pegged at around 15%.

This is by far the highest increase in tariff by UPPCL the operations were unbundled way back in 2000. As per rules, the tariff proposal should have been submitted by November last year. However, with elections in the offing, the exercise was postponed. The power regulator is expected to announce the new tariff within 120 days of admission of the proposal. The new government has adopted a tough stance against theft of power and all household are being connected to the feeders. Unmetered connections are being regularised and metered. At present, UP has as many as 80 lakh unmetered connections.