Government Approves Amendments To The Electricity Act, 2003 – India
The Government of India, on Wednesday December 10, approved amendments to the Electricity Act, 2003 in terms of the amendment bill proposed by the Ministry of Power.
The Ministry of Power had sometime in October 2014 circulated the draft amendments to concerned administrative authorities including the Central Electricity Authority, the Central Electricity Regulatory Commission, and State power generation and transmission utilities for their comments. The proposed amendments are substantially with respect to distribution and supply of electricity by seeking a separation of distribution and supply functions and activities within a specified period, to meet the Government’s objective of allowing consumers to select a power supply company of their choice. Presently, distribution companies while managing the distribution infrastructure to different categories of consumers also act as suppliers of electricity. The draft amendments also seek to impose stiffer penalties for non-compliance with directions of the State and Regional Load Despatch Centres or other orders or directions passed pursuant to the Electricity Act, 2003.
There were protests in certain quarters that the mandatory unbundling of the power distribution sector and creation of exclusive licenses to handle the retail supply business is aimed at privatising power supply, and will give [consumers] full liberty to indulge in “cherry picking”. The amendments, the Government believes, will promote competition, efficiency in operations and improvement in quality of supply of electricity in India.
By: Alfred Adebare, Of Counsel ([email protected]).