Centre softens stance on Electricity Act amendments

After several states protested against the proposed amendments to the Electricity Act, alleging that the new provisions dilute their authority to appoint electricity regulators, the Centre is now considering continuing with the existing framework of separate selection committees for each state.

Several states, including Tamil Nadu, Andhra Pradesh, Telangana, Maharashtra, Chhattisgarh and West Bengal, have written to the Centre about their grievances against the proposed amendments.

As per existing provisions, separate selection committees need to be constituted every time there is a vacancy in state electricity regulatory commissions (SERC), disrupting their ability to perform.

The amendment proposes formation of a national committee which would consist of two members from the central government and one representative each from two states.

'However, based on the suggestions received, the Centre is now considering to continue with the existing separate selection committees for each state - but make them standing selection committees so that there is no need for constituting them afresh every time a vacancy occurs,' Union power minister RK Singh said Thursday.

Dispelling doubts about the authority to set electricity rates, Singh said the power of tariff fixation remains with SERCs. The minister said, 'We are not taking away any power of states in appointment of members and chairpersons of SERCs, and the proposed reforms are aimed at promoting more transparency.'

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Singh clarified that the amendments do not propose a mechanism where consumers can be connected if the state government does not pay their share of subsidy to the discom on time. 'The subsidy is now being proposed to be given into the account of consumers maintained by the discoms through direct benefit transfer,' Singh said.