Kerala hikes power tariff by 16 paise per unit

Thiruvananthapuram: Electricity charges will cost more in Kerala, with the state electricity regulatory commission approving the increase in power tariff by 16 paise per unit. The Kerala government issued an order declaring a hike in power tariff on Friday. Earlier, State Electricity Minister K Krishnankutty had hinted at the government's plans to hike the rate. The revised rate will come into force in December. 

As per the government order, a hike of 12 paise will come into effect in 2025-26. With this, the government approved a total hike of 28 paise in power tariff. Consumers belonging to Below Poverty Line list who use power up to 40 units are exempted from the hike. Apart from the BPL households, old age homes and orphanages are also exempted from the hike.

The tariff hike applies to all consumers using more than 40 units of electricity per month with a connected load exceeding 1,000 watts. Fixed charges for both single-phase and three-phase connections have also been increased. A customer using between 201 and 250 units of electricity per month will pay approximately 30 paise more per unit from the current rate in the 2025-26 financial year. 

Krishnankutty told the media that only a small hike was approved as there was no other option to handle KSEB's financial crisis.  He explained that the Kerala State Electricity Board (KSEB) had initially requested a price hike of 37 paise per unit for 2024-25 and 27 paise per unit for 2025-26. However, the Electricity Regulatory Commission approved increases of only 16 paise and 12 paise per unit, respectively.  He added that the commission also rejected a proposed hike of nine paise per unit for the 2026-27 financial year by KSEB.

"If the cost of electricity purchased from external sources decreases, the benefit will be passed on to consumers," Krishnankutty said.

As solar power consumption increased in the state, domestic consumers using up to 250 units per month during the daytime will receive a 10 per cent reduction in tariffs. This initiative is expected to benefit around five lakh consumers, the minister said. 

Major decisions of power regulatory commission

• No hike in energy charges for commercial consumers.
• No hike in meter rent.
• To promote tourism, farm stays (in agriculture, dairy farming, and animal husbandry sectors) will be charged at domestic rates, similar to home stays.
• Private hostels will receive a tariff reduction of up to an average of 30%.
• No tariff increase for families below the poverty line (BPL) with cancer patients or differently-abled members in the household for monthly usage up to 100 units. The connected load limit for availing this benefit has been increased from 1000 kilowatts to 2000 kilowatts.
• The free rate for Endosulfan victims will remain unchanged.
• A marginal increase of 5 paise per unit in electricity rates for agricultural purposes.
• For the industrial sector, only an average increase of 1% to 2% in rates has been approved, keeping the sector's interests in mind.
• Small-scale industries with a load of 10 kilowatts will not see an increase in fixed charges. Energy charges will see only a 5 paise increase per unit, benefiting around one lakh industries. Considering a 10% reduction during daytime hours, industries will see a reduction in their electricity bills.
• For domestic consumers using over 250 units of electricity per month, daytime electricity rates will see a 10% reduction, factoring in solar availability. This benefit will reach approximately five lakh domestic consumers.
• Electricity tariffs for government-owned educational institutions and institutions run directly by Kerala universities have been moved to the government institution tariff category.