In a move that has surprised residents and businesses across the state, the Maharashtra State Electricity Distribution Company Limited (MSEDCL) has increased its fuel adjustment charges (FAC) for September.
Coming just before the festive season, this hike will make electricity more expensive for residential, commercial, and industrial consumers. The increase, which ranges from Rs 0.35 to Rs 0.95 per unit depending on the level of consumption, marks an unexpected financial burden for many as they prepare for Diwali, the festival of lights.
The circular announcing the hike was issued by MSEDCL on October 1, stating that the new charges would be effective from September 1, 2025. This decision has caused confusion, as it follows earlier claims by the state-run power distributor that rates had been reduced.
The fuel adjustment charges, which have been applicable since August and September, now add an extra layer of cost for consumers. This comes at a time when households and businesses are already facing mounting expenses associated with festive celebrations, including shopping, decorations, and other preparations.
The reason for the price increase is attributed to a rise in demand and the higher cost of purchasing power from the open market. Fuel adjustment charges are a variable component of a consumer’s electricity bill that allows a power distribution company to recover additional costs incurred due to fluctuations in fuel prices, such as coal or natural gas, which are used to generate electricity.
When a utility’s own power generation or long-term power purchase agreements fall short of meeting consumer demand, it must procure additional electricity from the more expensive open market. MSEDCL’s move is intended to bridge this revenue gap, passing the cost directly to the end consumer.
The revised rates mean that a consumer with higher power consumption will be impacted more significantly. For example, a household that uses a greater number of units will see a more substantial increase in their monthly bill, with the per-unit hike rising to as much as Rs 0.95.
For many, this price surge is a discouraging pre-Diwali expense, coming at a time when they are looking to spend on family gatherings and gifts. This unexpected increase underscores the challenges of managing energy costs in a dynamic market environment, where high demand and a volatile supply chain can lead to sudden price shifts. The decision places a direct financial strain on millions of customers, serving as a reminder that the festival of lights has, for many, brought expenses before the celebrations have even begun.
