Daijiworld Media Network – Mangaluru

Mangaluru, Jan 8: Along with an increase in electricity unit rates, consumers may also have to shoulder the burden of losses incurred by Mescom. The Karnataka Electricity Regulatory Commission (KERC) had approved Mescom’s electricity tariff revision proposal last year, applicable for a three-year period from the previous year up to 2027–28. As per this approval, the average electricity unit rate for 2026–27 will increase by 5 paise. In addition, there is a possibility that Mescom’s loss of Rs 83.11 crore incurred during the previous period may also be passed on to consumers.

Last year, KERC had directed all electricity supply companies (Escoms) to submit a triennial (three-year) electricity tariff revision proposal. Accordingly, Escoms submitted their three-year proposals to the commission. For the Mescom jurisdiction, a proposal was submitted seeking a per-unit hike of Rs 0.70 for 2025–26, Rs 0.37 for 2026–27, and Rs 0.54 for 2027–28. However, the commission approved only a 5 paise hike applicable for this year, granting its approval last year itself.

Although a combined three-year proposal was submitted, there is a possibility of revising the proposed tariff by reviewing Mescom’s annual profit, loss, and operational performance for each year. Accordingly, apart from the approved 5 paise per-unit hike, concerns are being raised among consumers that electricity tariffs may increase further due to revenue shortfalls.

Mescom has stated that losses have occurred due to higher-than-approved costs, including increased power purchase costs, transmission expenses, repairs and maintenance, depreciation, and other expenditures. However, members of the public have objected, stating that if the company incurs losses due to irregular or excessive expenditure, the burden should not be passed on to consumers.

Earlier, Mescom used to submit tariff revision proposals to the commission every year by presenting details of the previous year’s income, expenditure, and other financial data. The proposal would also specify the per-unit increase required to offset losses. However, from last year, this procedure has changed. Based on estimated calculations for three years, a single proposal was prepared and submitted at one time last year. As a result, Mescom cannot seek a fresh tariff hike this time in the manner followed earlier.

Based on estimates that Mescom would face a per-unit shortfall of Rs 0.70, Rs 0.37, and Rs 0.54 over three years, the three-year tariff revision proposal was submitted to the commission last year. After examination, the commission decided not to revise tariffs for 2025–26 and continued the average electricity unit rate of Rs 8.61 that was in force during 2024–25. For 2026–27, the commission approved an increase in the average electricity unit rate to Rs 8.66, which will come into effect from April 1. For 2027–28, the commission has approved a further increase, raising the unit rate to Rs 8.72.

“Although the three-year electricity tariff revision was carried out last year itself, the revenue gap for each year is being brought to the notice of the commission. In this regard, Mescom has submitted its annual performance review report to the commission and has sought tariff revision, said Jayakumar R, managing director, Mescom, adding that the commission is expected to take a final decision on the matter.