Put Electricity Act amendments on hold: Tamil Nadu tells Centre

By: |
May 10, 2020 4:40 AM

In a letter to the PM, Tamil Nadu chief minister Edappadi K Palaniswamy said any hasty amendments to the Electricity Act might create hardship to state power utilities.

Tamil Nadu chief minister Edappadi K Palaniswamy said any hasty amendments to the Electricity Act might create hardship to state power utilities, which are going through a severe financial crisis because of the present pandemic.Tamil Nadu chief minister Edappadi K Palaniswamy said any hasty amendments to the Electricity Act might create hardship to state power utilities, which are going through a severe financial crisis because of the present pandemic.

The Tamil Nadu government on Saturday urged Prime Minister Narendra Modi to prevail up on the power ministry to put the proposed amendments to the Electricity Act in abeyance till all the aspects are thoroughly discussed with the state governments after the Covid-19 pandemic comes under control.

In a letter to the PM, Tamil Nadu chief minister Edappadi K Palaniswamy said any hasty amendments to the Electricity Act might create hardship to state power utilities, which are going through a severe financial crisis because of the present pandemic. As some of the provisions of the draft amendment bill are also likely to create hardships for the general public, particularly during this crisis period, the CM pointed out this may not be an appropriate time to bring in such sweeping amendments to the Electricity Act.

Palaniswamy shot off the letter to PM in the wake of Union power ministry inviting comments of state governments on the proposed amendments to the act.

The CM pointed out that the proposed amendment bill seeks to take away the power of the state government in deciding the constitution of the State Electricity Regulatory Commission. This, he said, was against the federal principles of the Constitution. In the draft bill, it has been noticed that not just the same provisions are being retained, but it is also proposed to set up a parallel authority — Electricity Contract Enforcement Authority — at the central level to handle all contractual issues, hitherto dealt with by the Central and State Electricity Regulatory Commissions. “This would unnecessarily dilute the authority of the Electricity Regulatory Commissions and needs to be deleted,” he said.

The CM said, in his earlier letter dated November 12, 2018, it was highlighted that the proposed Electricity Amendment Bill takes away certain powers of the state government and at the same time seeks to bring significant changes in the existing Electricity Act, such as separating carriage and content in the distribution sector, which would make the power utilities in the public sector totally unviable.

The proposed new draft bill seeks to privatise not just the supply of power to the end consumer through franchisees but to also privatise the entire distribution network, which would be highly detrimental to the state utilities and against public interest.

Despite Tamil Nadu government’s strong reservations, the new draft bill continues to have provisions for the direct benefit transfer (DBT) of subsidy provided to consumers, particularly in the agricultural and domestic sector, Palaniswamy said.

It has been already pointed out that there would be serious difficulties in implementing DBT in the electricity sector and this would work against the interest of our farmers and domestic consumers. It has been the consistent policy of the Tamil Nadu government that the farmers should receive free power and it should be left with the state government to decide the mode of payment of such subsidy.

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