Tue Feb 18 14:13:40 UTC 2025: ## Karnataka High Court Allows MESCOM to Pass Employee Pension Costs to Consumers

**Mangaluru, February 18, 2025** – Electricity consumers in Karnataka’s MESCOM (Mangalore Electricity Supply Company) will be shouldering the cost of employee pensions and gratuities starting in the 2025-26 fiscal year, following a Karnataka High Court ruling. This decision overturns an earlier rejection by the Karnataka Electricity Regulatory Commission (KERC), which argued that such a cost should not be borne by consumers.

The High Court’s decision was revealed during a public hearing held by KERC on Tuesday to discuss MESCOM’s proposed power tariff hike for the next three years. MESCOM’s managing director, R. Jayakumar, proposed a 70 paise per unit increase for 2025-26, followed by 37 paise and 54 paise increases in subsequent years. A significant portion of this increase—36, 35, and 33 paise respectively—is allocated to cover employee pension and gratuity costs.

KERC chairman P. Ravi Kumar stated that the commission could no longer intervene in the matter. Mr. Jayakumar also presented projections showing a widening gap between the cost of power supply and the current tariff rates, necessitating the increase. He further detailed the consumer breakdown within MESCOM, with the majority being domestic consumers (70.95%). He also highlighted the company’s success in reducing distribution losses.

While the KERC had concerns about the added burden on consumers, the High Court’s decision ensures that MESCOM will implement the tariff hike, effectively transferring the pension and gratuity costs to electricity users. The remaining portion of the tariff increase will cover operational costs and projects.

Read More