Maharashtra To Slash Electricity Tariffs By 26% Over Next 5 Years In Historic Relief For Power Consumers

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Last Updated:June 26, 2025, 09:47 IST

Domestic consumers using smart meters will receive an additional 10 per cent discount under the Time-of-Day (ToD) tariff structure for daytime electricity usage

Nearly 70 per cent of the state’s domestic users consume less than 100 units, and they will see the highest drop in rates. (PTI)

The Maharashtra Electricity Regulatory Commission (MERC) has approved a historic proposal to reduce power tariffs for the next five years in a major relief to electricity consumers across the state.

For the first time in the state’s history, the power utility—MahaVitaran—approached the commission with a plan to reduce electricity rates, and the decision is now set to benefit households, industries, and businesses alike. According to the MERC order, domestic consumers using smart meters will receive an additional 10 per cent discount under the Time-of-Day (ToD) tariff structure for daytime electricity usage. Households generating solar power will also be incentivised under this new framework. The new rate structure ensures that the maximum benefit reaches lower consumption categories—nearly 70 per cent of the state’s domestic users consume less than 100 units, and they will see the highest drop in rates.

Maharashtra Chief Minister Devendra Fadnavis welcomed the commission’s decision, calling it “historic and consumer-friendly". He highlighted that for decades, electricity rate petitions often proposed hikes of 10 per cent or more. “This time, MahaVitaran has reversed the trend and proposed a tariff reduction—which has been approved. It’s a moment of pride to announce this decision that will positively impact nearly every electricity user in the state," said Fadnavis.

The reduction, phased over five years, will amount to a cumulative 26 per cent drop in power tariffs, starting with a 10 per cent cut in the first year. The state’s industrial and commercial consumers—who were previously subject to annual hikes—will also benefit from the lower tariffs, which aim to stimulate growth and competitiveness.

The relief to farmers is also significant. Under the ‘Mukhyamantri Baliraja Free Electricity Scheme’, over 45 lakh farmers using pumps of up to 7.5 HP are already receiving free electricity. The flagship ‘Mukhyamantri Saur Krushi Vahini Yojana 2.0’—focused on decentralised solar power generation—is progressing rapidly. It aims to generate 16,000 MW of solar power for daytime farm use by December 2026, ensuring reliable, cost-effective power to the agricultural sector. In terms of long-term planning, MahaVitaran has signed power purchase agreements totalling 45,000 MW, taking into account projected energy demand up to 2030. Notably, 31,000 MW of this capacity will come from renewable energy sources. The availability of low-cost green power is expected to save around Rs 66,000 crore in power procurement over the next five years, further justifying the tariff reductions.

Fadnavis expressed gratitude to the MERC, noting that this decision is aligned with the state’s vision of becoming a $1 trillion economy under Prime Minister Narendra Modi’s leadership.

“Affordable and quality power supply will be the foundation of our growth. This decision is not just a financial relief but a structural reform," he added. With energy costs declining and solar power initiatives scaling up, Maharashtra’s power sector seems poised for a transformative shift—ensuring both affordability and sustainability for its citizens.

Mayuresh Ganapatye

Mayuresh Ganapatye, News Editor at News18.com, writes on politics and civic issues, as well as human interests stories. He has been covering Maharashtra and Goa for more than a decade. He previously worked with...Read More

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