Power tariff hike likely from April as Escoms report ₹4,900 crore revenue loss

After suffering heavy financial losses in 2024-25, Karnataka’s electricity supply companies have approached the KERC seeking permission to revise power tariffs to stabilise operations.

Karnataka’s electricity supply companies (ESCOMs) have reported a major financial setback, with a combined revenue loss of around ₹4,900 crore during the 2024-25 financial year. To overcome this growing deficit, the companies have requested approval from the Karnataka Electricity Regulatory Commission (KERC) to revise electricity tariffs starting April this year.

The ESCOMs have already submitted their annual performance reports for 2024-25 to the regulator. According to these reports, the losses are significantly higher than what was estimated in March last year, raising serious concerns about the financial stability of power distribution companies across the state.

Among all utilities, the Bangalore Electricity Supply Company (BESCOM) has recorded the highest loss at ₹2,802 crore. Other distribution companies have also reported substantial losses. The Chamundeshwari Electricity Supply Corporation (CESC) has posted a revenue loss of ₹528 crore, while the Hubballi Electricity Supply Company (HESCOM) has incurred a loss of ₹604 crore. The Gulbarga Electricity Supply Company (GESCOM) has reported a loss of ₹457 crore, and the Mangalore Electricity Supply Company (MESCOM) has suffered a revenue shortfall of ₹480 crore. Together, these losses exceed ₹2,000 crore.

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The ESCOMs have warned that without a tariff revision, managing daily operations and maintenance will become increasingly difficult. The reports state that continued financial strain could affect the overall functioning of power distribution in the state.

As part of the proposed changes, the companies have suggested an increase in electricity tariffs for industrial and commercial consumers, as these users pay their bills directly without any government subsidy. A hike in these categories is expected to generate additional revenue for the ESCOMs.

At the same time, the companies have requested a reduction in electricity tariffs for agricultural pump sets. Since the state government pays these bills to the ESCOMs through subsidies, lowering the tariff would reduce the subsidy burden on the government. Officials believe this adjustment would benefit state finances.

Currently, under the Gruha Jyothi scheme, the Karnataka government bears the cost of electricity consumption up to 200 units for domestic users. In addition, agricultural pump set electricity bills have been subsidised by the state government for years.

With rising losses and increasing operational costs, the final decision on tariff revision now rests with the KERC, which is expected to examine the proposals in the coming weeks.