Restriction in power subsidy; Centre to amend law

Thiruvananthapuram: A draft law has been framed by the Centre amending the authority of state government over providing subsidy in electricity rate and appointing regulatory commission. Amid lockdown, the Centre has sought response on this from states.

It was in 2003, the Electricity Act was introduced. According to the law, if regulatory commission decides on the rates, state governments can provide subsidy with states pooling the balance amount.

In Kerala, BPL families are being provided electricity like this. However, the draft seeks to change this system similar to that of LPG subsidy provided by the Centre.

Whatever rate is decided by the electricity board, consumer has to pay. If state government is interested in providing subsidy, the amount can be deposited in consumer’s bank account. This will be allowed only if state governments are keeping aside an amount for electricity subsidy purpose.

Now, the system in Kerala is that more money is sought from large consumers and subsidy is provided for domestic consumers. This system is changed in the new draft.

The electricity regulatory commission chairman and its members are elected by a committee formed by the state government. This system will also change. A central committee will be appointed for this. When there is a vacancy in the commission in one state, a member from other state commission can be given the responsibility.

According to the 2001 Act, franchises were allowed for distribution of electricity. In the new draft, sub licencees are to be appointed which will lead to privatisation on the distribution system.

An Electricity Contract Enforcement authority will be formulated to resolve issues between KSEB-like licencees and power generators. A surety has to be given by licensees to the generators ensuring their money.