Delhi government ends power subsidy

In what comes as a double whammy for Delhiites who have had to put up with long outages this summer, the Delhi government on Monday officially rolled back a 10% subsidy on power.

Though the subsidy had come to an end on May 31 - and many residents have since complained of disproportionately high bills - there was much speculation on whether or not the government would extend the relief.

The subsidy was offered for a three-period by the government in 2005 to reduce the impact of a tariff hike. With the city investing heavily on infrastructure for the Commonwealth Games next year, the government said it was not in a position to continue footing the Rs 200 crore subsidy bill.

The impact of the subsidy cut is already visible as Delhiites got escalated bills in the last cycle. The bills for the peak summer months of June and July, this time made worse by errant rain and high temperatures, went up significantly.

Kiran Kapoor, resident of Mayur Vihar-I said: ``We have four ACs in our house but use only two at night. All family members crowd inside two airconditioned rooms to save electricity. Despite this, our power bill shot up to Rs 23,800 in June. The last bill was for Rs 17,874.''

Many residents, however, felt the bills were too high even after accounting for the subsidy rollback and increased consumption.

In 2005, when tariff had been increased, Delhiites had strongly protested against the move, citing poor performance by the discoms as justification for not paying a higher amount. Discoms had been gunning for a tariff hike saying that power rates in Delhi were the cheapest in the country and that there had been no hike for four years. The government had stepped in and agreed to provide a three-year subsidy to the tune of Rs 192 crore that amounted to a 10% reduction in overall bills.

However, the subsidy for agricultural users and that aimed at limited consumption users will continue. The latter, that was started in March 2008, had also come to an end on May 31, leaving consumers across the board paying escalated power bills.

Delhi power secretary Rajendra Kumar said, ``The subsidies were valid till May 31. There had been no order after that and bills were generated on the full tariff. Only now has the cabinet decided that the subsidies on agriculture and for targeted groups will continue for another year. Whatever extra amount these consumers have paid will be adjusted in future bills.''