VIA Objects to MERC's New Tariff Order, Considers Legal Options

Time of India

a day ago

Nagpur: The Vidarbha Industries Association (VIA) has expressed serious concern over the Maharashtra Electricity Regulatory Commission's (
MERC
) latest Multi-Year Tariff Policy Review Order.
VIA has described it as a regressive move which threatens industrial viability and green energy investments across the state. The association claimed that the new tariff regime is expected to significantly raise electricity costs for industries, particularly those operating on three-shift, 24x7 models.
According to VIA's preliminary analysis, the revised structure could increase electricity bills by 8% to 10% compared to the current rate.
"This sharp hike stems from a combination of increased demand charges, steeper energy costs during peak hours, and curtailed off-peak incentives under the revised Time-of-Day (TOD) tariffs," VIA said.
VIA president Vishal Agrawal stated that such abrupt changes undermine the govt's stated goals under initiatives like 'Make in India' and 'Atmanirbhar Bharat'. He noted that industrial growth depends on stable and predictable energy pricing, which the new policy disrupts by effectively reversing earlier tariff reductions through a mid-cycle review.
Agrawal warned that the impact will be particularly harsh on energy-intensive sectors such as textiles, engineering, and foundries, which are already under pressure from global competition, volatile raw material prices, and high logistics costs. He said many units, especially small and medium enterprises in regions like Vidarbha, may be forced to scale down operations or shut shop entirely due to the sudden rise in power costs.
Adding to industry's woes, the revised order also deals a heavy blow to the state's green energy movement. VIA has raised alarm over two specific provisions which it believes will discourage solar adoption. The first is the prohibition of night-time banking of solar power — a system that allowed industries to store excess day-time generation and draw it at night, ensuring round-the-clock usage of clean energy. "The new policy scraps this mechanism, forcing industries to either waste their surplus generation or invest in expensive battery storage systems, which most consider financially unfeasible," VIA said.
Equally damaging is MERC's introduction of Grid Support Charges (GSC) on solar power, especially targeting installations above 10 MW capacity. According to the new rules, even when industries use their own solar power or previously banked energy, they must pay a fee for utilising the grid infrastructure. VIA argues that this completely erodes the economic viability of solar investments and penalises companies that are actively contributing to grid stability during peak sunlight hours.
Agrawal emphasised the need for MERC to engage directly with stakeholders, particularly MSMEs and round-the-clock manufacturing units, before pushing through structural changes of this magnitude. He asserted that industries in Maharashtra — and particularly in power-surplus regions like Vidarbha — deserve a forward-looking and participatory electricity policy, not one that discourages efficiency and clean energy.
VIA, he said, will continue to advocate for industrial interests through formal representation and, if necessary, legal intervention.
Box:
VIA's demands
Roll back the punitive demand and TOD tariffs, and ensure no more than CPI-based escalation in effective cost
Reinstate night-time banking of solar energy to preserve the commercial viability of green power
Scrap the Grid Support Charges or at least cap them till an independent impact assessment is conducted
Hold stakeholder consultations, especially with MSMEs and large 3-shift units, before implementing such structural changes