Friday, July 20, 2007

Electric shock

There's a bomb in the mail: Your electricity bill.

Now there have been rumblings in Mumbai for some time. With Maharashtra facing acute power shortage the government has come up with an ingenious solution: charge users more.

In fact the idea is to 'penalise' those who use more. And especially business owners.

In April HT reported: All heavy power consumers of the Brihanmumbai Electricity Supply and Transport undertaking (BEST) will have to shell out more per unit. While households will have to pay 15 to 28 per cent more, commercial establishments like shopping malls will pay 84 per cent more.

'Heavy' use is defined as more than 500 units a month. Which in the context of a modern office is... laughable.

Well, so far all this was just the subject of academic debate. Then came our latest bill. The charges levied for May-June 2007 are exactly ... double. From a bi monthly bill of Rs 30,000-35,000, we're now saddled with a liability of Rs 68,000.

The first thing you do, of course, is check the meter. Well, that seems to be working fine. There is some increase in consumption (possibly due to summer).
So help us God. The BEST certainly isn't taking it kindly.

We are officially entering a new 'Dark Age'. "A/Cs will be put on between 11 and 11.25am every morning." Well, not that bad yet but we'll all have to be extra careful. And use fans more often.

While I wholly support electricity conservation, efficient use of resources etc the problem is there is only that much you can do in the short term. The industrial estate where my office is housed was built in the 70s. It has no clue what 'eco friendly' is about.

There are no windows offering natural light and/or ventilation. It's mobile-signal-blocking concrete all the way. Most of the new offices coming up in Mumbai are no better. They are in restructured mill compounds where you have to keep lights and a/cs on at all times.

Even if one could use natural light it would be impossible to work in the tropical climes of Mumbai without air conditioning... In fact windows have to be shut to keep out ambient noise and air pollution.

I am sure even a doubled electricity bill won't matter to very large companies whose stock price is doubling every six months. But for smaller outfits like JAM, it
could be a huge setback.

The blatant discrimination between the rate hike for households and businesses reflects the continuing socialist mindset of India. Businessmen are profit mongering capitalists who won't 'feel the pinch'.

Incidentally we in Mumbai are now paying the highest rates for electricity ... in the world.


  1. Why not move? At least, the bulk of the work to someplace most cost effective?
    Vote with your money/jobs.

  2. Rashmi,

    Eagerly waiting for part 2 of the entrepreneur series.....


  3. Ive had the same kind of issue. My problem isnt so much that they increased rates for the summer. It seems like a way to cut down on consumption that will actually work. However, I dont think most people knew exactly what was coming. I'm a fairly well connected person, I read newspapers, watch TV etc. but I was caught completely unaware by the hike last month. And Im not the only one, most people I've spoken to were caught by surprise too. What has essentially happened is that instead of cutting down on consumption( a laudable goal), the various electric companies have gotten a revenue bonus.

    And Electricty proces are ridiculous. A friend of mine with an office in Lower Parel wound up having a higher Electric Bill than Rent bill this month. Thats insane.

  4. Mumbaikars are paying the highest prices of electricity because Mumbai is one of those rare places in India which has an uninterrupted power supply 24 X 7 and this is at the cost of many districts in Vidarbha where power cuts of up to 12 hours a day are becoming common.

    The rationale behind price increase is to decrease the consumption. I am surprised by your such a self-centered and "capitalistic" opinion.

  5. err. why is nobody speaking about increasing the output of electric power in the country?. why do we even have a minsiter of power. he oughta be electrocuted

  6. maam though i agree to impact on small business, i feel its a fair it will lead to lower consumption or rather controlled consumption....lets look at long term benefits rather than initial hiccups.....we need to converse enrgy , to make the world a better place to be in ! so lets take it positively...we all have to shoulder the responsibility

  7. Totally agree on your point about the socialist mindset. Differential pricing & the caste based reservation is bound to create more harm than good in the long run.

    It however surprizes me to see the lack of energy conservation conciousness despite the high prices. Glass buildings (ok, badly ventilated industrial estates too:) are among the worst offenders. A tropical country is better off without any glass structures whatsoever. Yet nobody seems to incentivize eco-friendly constructions, or eco-friendly vehicles for that matter.

  8. Saving Electricity or rather deligently using it is the need of the hour, as we had know through the numerous expensive roadside signboards we were warned, but now we foot the bill of theft of electricity,of free electricity elsewhere( of course a neat "socialist" profit to the electricity companies)... paying the highest tariff for it.:) top it with high income tax,vat and octroi.....
    just think of it rashmi we all are the mamaries of a welfare state.
    unfortunately we elected them.....................:P

  9. For sheer ineptness and jackassbaazi, this move takes the cake. I mean, has the cost of producing electricity gone up? No. Has the cost of distribution moved? NO.

    So who is behaving like a grubby little capitalist? Though wiyh Reliance Energy in the picture somewhere, I am a little leery of believing the whole story just yet.

    Maybe you ought to do what we have been doing in our NOIDA office since we moved. Virtually produce our own power, while taking care to optimise overall load as carefully as we can. I can tell you all that research has helped me immensely at home at least:)

  10. Well it's funny in an ironic way to see Mumbaikars cribbing about electricity woes.

    Good Mooooorning Mumbai....(in the Munnabhai way)! The wake up call for the city has come a little too late...the rest of the country has been grappling with these issues for now you're being sensitized to issues you were earlier indifferent to!!!!

  11. Its sad to see some morons here equate the failure of our governments to have augmented power generating capacity years back with the obvious and generic need to conserve every resource.
    It is even worse to see some small town asshats derive sadistic pleasure out of the power woes of Mumbai just because their towns faced such issue since much longer. Why not channelize your emotions and energies on talking about how goverments must get clean up this mess for all of us?
    The only immidiate and urgent first-step to resolve this crisis would be for the goverment/s to get out of the power business completely and have private and foreign players step-in while a power regulatory body like TRAI for telecom should be setup to ensure a fair marketplace. But the Gandhi-controlled congress/commies will never do it for these parties owe their very survival to kickbacks from state control and license-raj - excerpted from my blog.

  12. wow, that is indeed appalling. I couldn't agree more than with helicopter bernanke ;) Unfortunately reasoning and justifying these days seem ever so futile.

  13. @Huzefa
    500 units a month is ridiculously low if you look at any standard-sized office today. Moreover, one cannot be taxed more for being more productive which is waht government seems to be doing in this case. And thats why the post. Seems you have missed the essence all together.

    Having said that I must confess that this move will definitely lead to lesser electricity consumption. The intent of govt might be correct but the method used is grossly misplaced.

  14. I am intersted to write on part time basis. I can assure you good features. where is the requirement? Is it in JAM?

    My no is 9833181107
    Loknath Swain

  15. It should be obvious that forcing to reduce consumption will end up in reduced productivity/jobs for these businesses. Totally support the opening up of the power generation industry to private companies. They can be held accountable and competition and a regulatory authority will force them to provide better/cheaper service. Why has the MTNL and BSNL slashed their rates, which they would never have dreamed of if not for competition from the private sector. Reduction in consumption should come from awareness and not from force. We are only now on the highway to growth, infrastructure should not become a stumbling block, as we might not have this same opportunity in the near future again..

  16. This comment has been removed by the author.

  17. What rubbish strategy to counter electricity problem. Its as good as locking yourself in a cage if some tiger escapes into the city. May almighty grant them some wisdom.

  18. I think the consumers were previously being subsidized by the state for the power they use.
    Finally, the state is acting very capitalist - charging users the correct and "complete" cost of their electricity!
    Even now the petrol you use is subsidized. One day even that subsidy go!

    Welcome to free markets!

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