Govt mulls tax relief to industrial units

Mumbai: The Maharashtra Government may consider granting tax relief to industrial units producing their own power using diesel-based captive power plants.

Sources in the State Government said that the State Cabinet was expected to consider a proposal seeking concessions in VAT and other taxes on diesel used by captive power plants.

At a meeting held at the State Secretariat on Monday with the representatives of industry associations, the State Energy Minister, Mr Dilip Walse Patil, said that with the help of captive power plants, about 1,200 MW of power could be produced which could give some relief to the power-starved units.

Price of power from diesel-fired captive plant is likely to be a whopping Rs 12 per unit.

subsidy on diesel


Mr Hemant Rathi, President of the Maharashtra Chamber of Commerce, Industry and Agriculture, said the industries associations have demanded subsidy on diesel so that producing captive power becomes viable. The proposed additional day of staggering load shedding would cost huge losses to the industry in the State and therefore the association has demanded that the Government should compensate for the losses incurred by the industry.

Earlier in the day, the Maharashtra Electricity Regulatory Commission (MERC) came down heavily on the Maharashtra State Electricity Distribution Company Ltd (MSEDCL) for its inability to gauge the exact demand and supply of power in the State. MERC was hearing the load shedding plan of the MSEDCL. MSEDCL has approached MERC for the second time in two months with load shedding plan.

At the hearing, Mr A. Velayutham Member (Technical) of MERC, said that MSEDCL as a utility company should have anticipated the rise in demand for power in the State and accordingly made its load shedding plan. MSEDCL cannot approach the commission every time the demand fluctuates in the State, he said.

At the hearing, the MSEDCL proposed one more day of staggered load shedding for industrial units in the State. It has also announced a new load shedding schedule where the minimum load shedding is for six hours for urban areas and 15.5 for predominately rural areas.

Mr A.B. Pandey, Managing Director of MSEDCL, said that certain technical problems of the power plants in the State and the central grid have resulted in a further shortfall of 1200 MW. The 330 MW from Dabhol plant, which was supposed to be supplied by March 31, has also not materialised, he said.