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A steep hike in power tariff appears imminent across the country, with Karnataka and some other states seeking permission to increase the rates.

Besides Karnataka, Tripura and Punjab have also submitted their proposal to the Electricity Regulatory Commission seeking tariff revision.

In the past 18 months, 24 states have revised their electricity tariffs ranging from 20  to 37 per cent. While Tamil Nadu is the latest to hike the rates by 37 per cent, Bihar, Rajasthan and Madhya Pradesh, too, have increased power tariff.

As the harsh summer has kicked in, a steep hike in electricity tariff is likely to pinch consumers soon, as energy distribution companies across the country have started measures to write off their losses.

At the insistence of the Central Electricity Regulatory Commission and the Union Power ministry which sent out a directive to state electricity boards  and power distribution companies (Discoms)  to reduce the mounting debts, several of the state governments have started jacking up the power prices steeply.

“The hike of tariff is imminent as the financial health of most of the state electricity boards as well as discoms is grave as the accumulated loss has crossed Rs 1.16 lakh crore in the country,” said a senior official in the Power ministry.

“To survive, Discoms have to go for a steep hike as the cost of buying power is also increasing due to coal and gas crisis,” an official said. Andhra Pradesh and Odisha had increased the tariff up to 25 per cent while Uttar Pradesh and Rajasthan were aiming at over 30 per cent hike.

Late last year, the Shunglu Committee on Financial Position of Distribution Utilities suggested a slew of measures such as setting of a special purpose vehicle to absorb losses of Discoms.

Besides, the Appellate Tribunal of Electricity asked state regulators recently to ensure time and cost-reflective tariff determination. Worried over alarming debt of the discoms, Union Power Minister Sushilkumar Shinde recently said the Centre was planning  some financial packages to bail them out of their problems.

The Power ministry, in its 12th Five Year Plan (2012-2017) draft report, had suggested amendments to the Electricity Act to empower the state electricity regulatory commission to revise the power tariff suo motu without waiting for Discoms to submit their proposals.

As the cost of power increases every year, Discoms should have the liberty to revise the tariffs as per availability to keep the companies’ financial health in good shape, a senior official said. Power tariff hike had to be a market-driven mechanism and not a political decision.

Though at present the Indian Electricity Act empowers distribution companies to approach the state electricity regulatory commission every year seeking revision of tariffs, it was not happening as many times the state governments did not allow Discoms to hike the tariffs.