MERC bars BSES from disconnecting power over deposit

The Maharashtra Electricity Regulatory Commission (MERC) has restrained BSES (now Reliance Energy Ltd) from disconnecting power supply to its Mumbai suburban consumers for non-payment of additional security deposit.

MERC, in its interim order on a plea made by the Mumbai Grahak Panchayat, however, said the matter of security deposit may be decided as part of ensuing proceedings on BSES’ annual revenue requirement proposal and determination of tariff for 2003-04. BSES, in the wake of MERC’s interim order and also due to mounting pressure from political parties and consumer organisations, has decided to discontinue the clause, pertaining to the disconnection, from its bills after December 6. BSES spokesman said, “In deference to the request of our consumers, the disconnection clause on the bills has been discontinued from the notice issued after December 6. In line with this decision, all consumers who have received notices prior to this date will receive the same facility. The company has decided to extend the time period for payment of additional security deposit in three equal monthly installments against a one-time payment. The impact of additional security deposit requested from the vast majority of residential consumers is at an average of only Rs 60 per consumer for three months.”

BSES had estimated a collection of Rs 200 crore through recovery of additional security deposits from its 20 lakh consumers from the Mumbai suburbs. BSES had justified its collection based on the Supreme Court order, which had allowed all utilities to collect security deposits. The company had sent notice to its consumers relating to the payment of security deposits within seven days, failing which power supply would be disconnected.