Several states, mostly non-BJP ruled, protested against the new proposed amendments to the Electricity Act, 2003, during the State Power Ministers’ Conference.
Bihar, Rajasthan, West Bengal, Odisha and Kerala protested against the amendments at the meeting, held via video conference between the Power Ministers / Departments of States and the Union Ministry of Power.
In April, the Center unveiled proposals for amendments to the Electricity Bill of 2003 and asked the States to submit their comments. Major amendments include an end to the subsidized power, replacing it with a ‘direct benefit transfer’ of subsidies, a reduction in the cross-subsidy burden on industrial consumers, a new contracting authority and a new selection process for existing State Electricity Regulatory Commissions (SERCs).
West Bengal, in its representation, said the new amendments to the Act constitute a “infringement of the sovereignty of the state.” The state government opposed almost all of the new provisions proposed in the draft bill for 2020. The State opposed the proposal to have a committee to select the members of the SERCs. Rajasthan, along with West Bengal, said that this would take away the autonomy of the states in the selection process.
There have been several states that have condemned the move to end the subsidized power. The provision of power tariff determinations has been revised in the Bill and requests that all SERCs ‘determine the tariff for retail sale of electricity without any subsidies under Section 65 of the Act.’ It proposes to grant subsidies directly to the consumer.
States opposed this on the ground that it would be difficult to enforce DBT in electricity, according to sources.
One of the proposals of the bill is to open up the distribution of power to the private sector. The Center also urged States to join hands with private power distributors, on a franchise basis, to improve their revenues.
Bihar, which is a BJP-aligned state, opposed the proposal to privatize the distribution of power, as it fears an increase in the rate of power.
The draft Electricity Bill 2020 received comments from all stakeholders and is under consideration.
