Steep tariff hike and imposition of smart meters:
Intensifying the loot of the working class

The monopoly capitalists in the electricity sector are aiming to maximise their profits through steep tariff hike and imposition of smart meters.

Recently, Tata Power, a private electricity distributor company in Mumbai, proposed a huge hike in power tariffs. Tariffs are set to be nearly doubled from Rs. 3.74 per unit to Rs. 7.37 per unit for consumers who consume up to 100 units. For consumers of 101–300 units, the rates will increase from Rs. 5.89 per unit to Rs. 9.31 per unit. This means that consumers of 300 units, who currently pay a bill of around Rs. 1767 per month, will have to pay Rs. 2793 per month from April 2024, if the proposed tariffs are approved. The hike will affect 5.5 lakh residential consumers in Mumbai, forcing many to cut down their electricity consumption.

The present proposed steep tariff hike follows earlier attempts by Tata Power to hike power tariffs in the past two years, which were challenged before the Appellate Tribunal for Electricity.

Further, Tata Steel and Tata Steel Utilities and Infrastructure Services Limited have proposed an increase in electricity rates in Jamshedpur and Seraikela-Kharsawan district this year. This comes after previous rate hikes in 2022 and 2023.

The imposition of smart meters is another way in which the monopolies in the electricity sector are trying to loot the people, as was recently reported in Mazdoor Ekta Lehar. Lakhs of smart meters have already been installed in various states, and the Central Government has decided to install 25 crore pre-paid smart electricity meters all over the country by 2025.

With pre-paid smart meters, consumers will pay for electricity before using it. The distribution company will collect the money remotely and in advance, thus simplifying bill collection. Once the pre-paid amount is exhausted, companies will be able to disconnect the power supply remotely using smart meters. The cost of installing these devices will be extracted from consumers over the years.

It is to be noted that the Central Government is incentivising smart meter implementation undertaken in a public–private partnership arrangement. People’s money is being offered to the big capitalists so that they can operate a system that will extract even more money from the people in the near future. Farmers in Punjab and workers in Kashmir, Tamil Nadu, and other states have been persistently protesting against the installation of smart meters.

As announced last year, the government is set to introduce the time of day (ToD) tariff system along with smart meters. Under this system, tariff during solar hours (8 hours in the daytime) will be 10%–20% less than the normal tariff, and that during the night, when demand is high, will be 10%–20% higher. The government is justifying this system by assuring the people that they can optimise electricity consumption and bring down their bills by using electricity during solar hours. However, working people leave their house during these solar hours and return home at night, when tariff will be high!

The implementation of smart meters and ToD tariffs will impose very high costs on  electricity consumers, forcing them to cut back on consumption of electricity. It is clear that these policies are being introduced to make the electricity distribution sector more profitable, ultimately making this sector lucrative for private capitalilst monopolies to take over .

However, the experience of places such as Mumbai and Delhi, where electricity distribution has already been privatised, has shown that privatisation is not in the interest of the working class. Once privatised, distribution is oriented towards increasing profit instead of ensuring that all people can use electricity at affordable rates.

Workers, peasants and the toiling majority must demand that anti-people policies of smart meters and ToD tariffs are withdrawn. We must demand that all privatisation in the electricity sector is stopped and rolled back.

To  ensure universal and affordable access to electricity, workers and peasants must unite to take the means of production into their hands. Under capitalism, electricity will remain a business that a handful of monopoly capitalists can make profits from, by squeezing the working people. It is only under workers’ and peasants’ rule that the economy can be re-oriented to fulfil the needs of people and electricity can be provided as a right.

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