As per the new guidelines, the centre and the state have to set up central transmission utility (CTU) and state transmission utility (STU) to regulate the transmission system in the respective areas. These utilities will have similar functions in their respective jurisdictions.

The CTU shall undertake transmission of energy through inter-state transmission system and plan and coordinate transmission system with state STUs, central and state governments, power generating companies, regional electricity boards and authorities, licenses, including transmission licensees and any other person notified by the central government.

The STU shall undertake transmission of energy throughintra-state transmission system and plan and coordinate issues related to intra-state transmission system with the CTU, state government, power companies and other state-level agencies.

The act empowers the CTU and STU to approve proposals of private companies to enter into the transmission business as per the directives given by the centre and state regulatory commissions. The transmission license will finally be granted by the centre and state commissions and until these commissions are set up the centre and state government may provide the license subject to the provision of sub-section (4) of the Electricity Act.

The transmission licensee will be authorised to construct, maintain and operate any inter-state transmission, in case operating in the centre and intra-state transmission system in case operating in the state.

The act has also made amendments in the section 30 of the Electricity Act allowing the licensee to transmit or use energy at a rate 250 watts and one exceeding 100 volts. The act hasalso introduced a fine of Rs 3,000 and a daily fine of Rs 300 on a transmission company in case of continuous contravention.

The transmission bill was required to allow private companies enter into the power transmission business without being power generation or distribution companies. Power transmission till now was the responsibility of the centre and state or some of the licensee utilities which are engaged in power distribution as well. While a distribution company could enter into transmission business, license for only transmission work was not allowed to any company.

INSIGHT

Need to improve T&D network

More than adding generation capacity, the country drastically needs to improve its transmission and distribution (T&D) network. The ideal ratio of investment in generation and T&D is 1:1, which has not been complied with in any year. SEBs are bankrupt and hence in no position to invest. At last the government has realised that there is no point in adding generation capacity ifat least 25 per cent of generation will be wasted through T&D loss.