FKCCI demands increase in power tariff to be withdrawn

Perikal M Sundar, President of the Federation of Karnataka Chambers of Commerce & Industry, Bengaluru, expressed his unhappiness over the hike in power tariff by the KERC.

He mentioned that an average increase of Rs 30 paise per unit (considering increase in fixed/demand charge and energy charges) with respect to BESCOM allowed by KERC would cost a heavy burden to all categories of consumers and affect the economy as any increase in power tariff would reflect on the selling price of raw materials namely Iron, Steel, Forgings and Castings which are primary input materials for all the Industries including MSME.

"This decision of KERC during the lockdown of 2nd wave of COVID-19 is a big blow apart from huge increases in steel prices as well as petrol/diesel price. The efforts made by the State Government in bringing attractive and investment friendly Industry Policy 2020-25, laudable reforms in Industry Facilitation Act and bold reforms in Karnataka Land Reforms

Act to attract investment & to generate employment will go in vain because of the power tariff hike decision of KERC," he added.

Sundar stated that at a time when 90% of the industries in the State have closed their operations due to the lockdown announced by the Government to curb the negative effect of second wave of COVID-19 pandemic, it was not an appropriate time to increase the tariff.

"At present industries who are into export business are operating with 40% to 60% production capacity only. In such a situation, it was not appropriate time to hike the power tariff by KERC. FKCCI had made strong representation to Department of Energy,

Government of Karnataka, and also KERC during public hearing not to hike the power tariff for the next two - three years. The Federation has objected to any increase in tariff and highlighted with facts and figures that the proposed increase in tariff will not augur well for Industries of Karnataka to attract the investment during the public hearing held by KERC," he added.

The FKCCI President said that the ESCOMs are selling the surplus powers to other states at a lower price and if the same could have been provided to the industries the economy could have been boosted. FKCCI demanded that the government direct the KERC to withdraw the power tariff hike and not to raise power tariff for next 2-3 years due to pandemic situations.

"FKCCI would like to inform the Government that if this power tariff is not withdrawn, then industries will close down their operations. In the event we have no alternative but to hand over the keys to the government after closing the units," Sundar added.