• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Our Bureau

Chennai , July 19

WITH the Electricity Act 2003 now in place, the Union Power Ministry is working on a series of policy documents, including a national electricity policy and an electricity tariff policy, the draft of which has been released.

Addressing the Confederation of Indian Industry here on Saturday on the Electricity Act 2003, the Union Power Secretary, Mr R.V. Shahi, said that the electricity tariff policy would be ready by September-October. "We would try to provide a degree of predictability through the tariff policy," he said.

On tariffs, the Secretary said that the Act clearly stated that cross-subsidies should be gradually reduced and ultimately eliminated. His assessment was that wherever tariff revisions had been made with the regulatory commissions functional, the issue of high tariff for industry had been addressed. Either industrial tariff had remained the same or the increase was marginal, whereas the increase for other segments of consumers was higher. The band between industrial tariffs and the highly subsidised consumers should narrow down, he said.

The Ministry was also working on various initiatives for rural electrification, either through stand-alone generation and distribution systems or through cooperatives.

"We have done our job. That part of the job, which we have not done, we will do through these documents. Now most of the work has to be done by industry and entrepreneurs," Mr Shahi said referring to the Electricity Act and the various other policy documents, which were getting ready.

He told the gathering that the Act opened up competition in the power sector, kept the consumer as the focal point and provided avenues for investment. The Act was based on the principles of promoting competition, protecting consumer interests and providing power to all. Generation had been de-licensed, captive power policy had been liberalised, and open access provided for transmitting power. The Act also provided for constituting an appellate tribunal to hear and settle disputes arising from the judgements of the State and the Central electricity regulatory commissions. All appeals against the rulings of the commissions would first go to the appellate tribunal and after that to the Supreme Court.

The Ministry, he said, was working out guidelines on parallel distribution licensing in urban areas. The Ministry would also shortly notify the list of hydropower projects that required techno-economic clearance. The Electricity Act had diluted the provisions that hydel projects required techno-economic clearance.

Another significant provision in the Electricity Act was with regard to preventing power theft. Nearly 40-50 per cent of the power was lost either through theft or commercial loss and this inefficiency in the system reflected on the tariff. There were stringent provisions to deal with theft, against not only the consumers indulging in theft but also employees of utilities who connived with them. In this regard, States like West Bengal, Karnataka, Madhya Pradesh, Uttar Pradesh, Andhra Pradesh and Rajasthan had enacted anti-theft legislations with good results. It was a myth, Mr Shahi said, that theft happened only in the rural areas. It happened in a bigger way in urban areas and industrial centres.

Later, talking to reporters after reviewing the performance of the southern regional electricity boards and utilities with regard to the Accelerated Power Development and Reforms Programme and their business plans, Mr Shahi said similar regional reviews would be conducted in the eastern and northern regions. A review of the western region had been carried out. These review meetings were expected to be completed by July-end or early August, after which a national-level meeting would be held to discuss distribution reforms, review the APDRP performance, and disseminate the best practices in a particular State to other States.

Article E-Mail :: Comment :: Syndication

Stories in this Section
Crop prices rule higher, may boost farm incomes

Copyright © 2003, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line