In a relief to the Tamil Nadu government, the Centre has assured it that implementing the direct benefit transfer (DBT) in relation to subsidy for electricity consumers is “not mandatory”.
It is also up to the States to decide whether to engage private franchisees/sub-licensees. The issue of allowing the involvement of franchisees or sub-licensees has been a concern for Tamil Nadu. The Centre is also willing to let the present arrangement for the selection of chairpersons and members of the State Electricity Regulatory Commissions (SERCs) continue.
These were the concessions that Union Minister of State (Independent Charge) for Power and New & Renewable Energy R.K. Singh had indicated during a discussion last week with State government representatives on the draft bill to amend the Electricity Act, a senior official said.
The T.N. government is not keen on opposing the creation of the Electricity Contract Enforcement Authority. The State has remained opposed to the introduction of the DBT, as otherwise, the free power scheme for farmers would have to be scrapped. Domestic consumers are also getting up to 100 units of free electricity bi-monthly, regardless of the level of consumption — a feature the State government does not want to disturb.
The Centre had told the State government that while it was inclined to give a one-year extension of the deadline for the DBT implementation, the SERC could also provide further extensions of up to a year. The DBT has been a bone of contention as the Centre had prescribed it as one of the conditions that needed to be met for raising the borrowing limit and relaxing the normal ceiling of fiscal deficit — 3% of GSDP — by two percentage points. As for the selection process for SERCs, the State government’s stand is that there should be no change in the current system of the selection panel being headed by a former judge of the High Court concerned, with one member each from the State and Central governments. But the draft amendment bill seeks to have a common selection committee for chairpersons and members of the Appellate Tribunal for Electricity, the Central Electricity Regulatory Commission and SERCs, including a former judge of the Supreme Court, the Chief Secretaries of two States at a time (who will hold the post for one year) and two nominees of the Union government, including the Power Secretary.
A Power Ministry official said what had been sent to the States was only a draft bill, and its purpose was to elicit the views of all stakeholders.
As for the Electricity Contract Enforcement Authority, the official explained that under the existing scheme of things, there was a “conflict of interest”, as SERCs, meant for issuing tariff orders, were also adjudicating on contracts for purchase and sale of electricity — a role that should ideally be played by a judicial body and not a quasi-judicial one. It is to correct this “anomaly” that the formation of the Authority has been proposed.
