DNA EXCLUSIVE: MERC to decide future course of action against Adani Electricity

Maharashtra Electricity Regulatory Commission may explore multiple options available under its own regulations and the Electricity Act, 2003 to address the issue raised by political parties and NGOs relating to the inflated bills recovered by Adani Electricity from its consumers, mainly from the suburban Mumbai. Power industry experts explained that MERC may accept Adani Electricity's explanation and close the matter or rap the company for lapses in the dissemination of information with regard to sending electricity bills on an average basis. The regulator may rope in a third party to prepare a report and based on its recommendations ask Adani Electricity to take corrective steps.

MERC may also consider slapping a penalty directing Adani Electricity to use the money for welfare purpose. The regulator may opt for extreme step of cancellation of Adani Electricity's distribution license after the company took over the Reliance Infrastructure's Mumbai distribution business since August 29. 

However, experts believe that the regulator may not go to that extreme. MERC, which will scrutinise documents submitted by Adani Electricity, will announce its decision at the press conference convened on Friday.

Adani Electricity preferred not to comment citing that matter is pending for decision with MERC.

MERC's former member Jayant Deo told DNA,''MERC should have taken a suo moto cognisance of public unrest and served a show cause notice to Adani Electricity asking the company to explain why its distribution license should not be cancelled."

A retired MERC member recalled that the regulator had appointed Administrative Staff College of India to prepare a status check on various aspects of Reliance Infrastructure's (Distribution) business after the government had issued directives under section 108 of the Electricity Act. However, MERC did not review its tariff order issued on June 15, 2009.

Adani Electricity has already clarified that the tariff hike was due to its revision approved by MERC and also because of increased consumption. As reported by DNA, Adani Electricity had sent bills to around 80,000 of the total 27 lakh consumers on an average basis as the labour union was on strike from August 27 to September 1 when it had taken over the distribution business from Reliance Infrastructure.

COURSE OF ACTION

Power industry experts explained that MERC may accept Adani Electricity’s explanation and close the matter or rap the company