Independent Distribution License for Industrial Estate in Aurangabad
Mumbai: Auric City, which operates the Shendra-Bidkin industrial estate near Aurangabad, has been allowed to distribute electricity independently to industries in its area, the first such experiment in the country. This has paved the way for industries in Shendra-Bidkin to get electricity on an average 40 to 50 per cent cheaper than MSEDCL’s industrial tariff.
The Shendra-Bidkin Industrial Estate near Aurangabad has been inindustriesdustriesset up under the Delhi-Mumbai Industrial Corridor project for which a special company (SPV) called ‘Auric City’ has been set up. Maharashtra State Industrial Development Corporation (MIDC) has 51 per cent share in it. Although the Shendra and Bidkin industrial estates are not contiguous, they are spread over a total area of 3300 hectares. At present there are 24 industries in this industrial area and their total power demand is 14.5 MW. In the next five years, ie by the end of March 2026, the industrial sector will have 654 industrial customers and their total electricity demand is estimated to be 368 MW.
Auric City had applied to the State Electricity Regulatory Commission for a license to distribute electricity to industries in its area. But at that time, the State Electricity Regulatory Commission had made it clear in 2019 that MSEDCL should be licensed as a franchisee without deviating from MSEDCL. It was challenged by Auric City in the Central Appellate Arbitration. As Auric City has the status of a local authority, it can purchase electricity from the market and distribute it independently in its area as per the Electricity Act, the arbitration ruled in July. The state Electricity Regulatory Commission was also asked to issue an order allowing this by September 12. Accordingly, the State Electricity Regulatory Commission has now allowed Auric City to distribute electricity independently in its area, namely the Shendra and Bidkin industrial estates.
40 to 50 percent reduction in electricity rates
At present, the average power tariff for industries in the state is Rs 9 per unit. It is higher than the neighboring states. Industries have to be given ‘cross subsidy’ to supply power to agricultural pumps at a discounted rate. Therefore, electricity for industries is expensive.
In the new structure, Auric City will be able to procure cheap electricity through a competitive tender process for industries in Shendra-Bidkin. Loss of power distribution at MSEDCL level can be avoided by using high pressure system.
The burden of ‘cross subsidy’ for cheap electricity to agricultural pumps
Will not be in the composition. Therefore, it is estimated that the power tariff of the industry will be reduced by 40 to 50 per cent.
Experts are of the view that this model of providing cheap electricity to industries through local authorities for industrial estates in other parts of Marathwada-Vidarbha can be implemented on the lines of ‘Auric City’.
The first experiment in the country
This is the first time that an industry has been allowed to distribute electricity independently of the state power distribution company. As a local authority, Auric City will be able to procure cheap electricity from the market and provide electricity to industries at reasonable rates, avoiding power outages and cheap loads of agricultural pumps. The cost of using MSEDCL system will also be reduced, This was stated by electricity expert Ashok Pendse.
Considering Maharashtra, the state currently supplies electricity to industries at an average of Rs 9 per unit. That electricity rate can be brought down to five rupees. This is a good experiment to reduce industrial power tariff in Maharashtra. – Ashok Pendse, Electrologist