Tata Power defends additional security deposit as BJD stages protests

Bhubaneswar: Tata Power on Thursday stood by its move to collect additional security deposit (ASD) from electricity consumers, even as protests against the levy intensified across several parts of Odisha.

The youth and student wings of the opposition Biju Janata Dal took to the streets in the capital, staging demonstrations outside Tata Power offices and calling for the immediate rollback of ASD notices and the scrapping of smart meter installations. In some areas, protesters damaged smart meters to register their anger. Similar protests were reported from Salipur, Dhenkanal and Puri districts.

ASD is calculated on the basis of a consumer’s average electricity usage for two months. For instance, a consumer with an average monthly bill of Rs 5,000 is required to deposit Rs 10,000 as additional security.

Senior BJD leader Debi Prasad Mishra, who led the protests, alleged that the ASD demand and smart meter notices were anti-people and should be withdrawn without delay. He argued that consumers already pay a security deposit at the time of obtaining an electricity connection and imposing another deposit amounts to an unfair financial burden.

Protests against the ASD were also held in other parts of the state, with consumers demanding the cancellation of the notices. The State Electricity Consumers Mahasangh urged people not to pay the additional amount. Mahasangh president Panchanan Kanungo appealed to consumers to resist what he described as pressure tactics by the power utility.

Responding to the criticism, chief executive officers of Tata Power Distribution Companies rejected the allegations at a press conference in Bhubaneswar. They maintained that the collection of ASD is mandated under the Electricity Act, 2003 and in accordance with regulations framed by the Odisha Electricity Regulatory Commission.

The company said the provision for ASD is not unique to Odisha and is followed in several other states, including Gujarat, Uttar Pradesh, Maharashtra, Karnataka, Chhattisgarh and Andhra Pradesh.

Gajanan Kale, chief of Tata Power’s Odisha distribution business, said the company supplies electricity to nearly one crore consumers and operates under strict regulatory oversight to ensure uninterrupted power supply throughout the year. He explained that the annual review of security deposits is a statutory process intended to balance consumer protection with the financial stability of the distribution business.

Kale said the security deposit carries an annual interest of 6.50 per cent, which is adjusted in consumer bills during the first quarter of the year. Any excess amount due to lower consumption is also adjusted. He added that the deposits are kept as fixed deposits and are not used for day-to-day operations.

The company further clarified that consumers whose power consumption has gone up are required to pay additional security to maintain adequate coverage as per regulations. It also pointed out that consumers can opt for prepaid electricity connections, which do not require any security deposit or ASD.

According to Tata Power, interest amounting to Rs 217.29 crore was credited to consumer bills across Odisha in the 2024-25 financial year on security deposits at the prescribed rate. The company emphasised that the rules governing security deposits have existed for decades and were followed even under earlier power utilities such as CESU, NESCO, SOUTHCO and WESCO.

The distribution companies said consumers who receive ASD notices must pay the amount within the stipulated period, failing which a surcharge of 15 per cent per annum is applicable on the outstanding amount. Meanwhile, a delegation of the Consumer Mahasangh has submitted a memorandum to the Odisha Electricity Regulatory Commission seeking withdrawal of the ASD demand notices.

(with inputs from agencies)