Kolkata: Chief Minister Mamata Banerjee has written to Prime Minister Narendra Modi demanding withdrawal of the proposed Electricity (Amendment) Bill as it is likely to affect the interest of the state government in the power sector.
The Power sector is in the Concurrent List of the Indian Constitution and Banerjee apprehends that such a decision would affect the federal structure of the country.
The Bill proposes the appointment of an Electricity Contract Enforcement Authority (ECEA) that will be constituted by the Centre. Banerjee raised her protest against it stating that the move was unconstitutional.
Setting up of the ECEA will restrict the powers of the State Electricity Regulatory Commissions (SERC) that is the single-point forum to redress issues related to tariff fixation, the grant of licenses and adjudication of disputes.
The Chief Minister felt that it is the Centre's move to gain direct control over the power sector across the country ignoring the state governments.
At the same time, she has also opposed the provision in the Bill for the Direct Benefit Transfer (DBT) of the subsidy provided to consumers as it will adversely affect its beneficiaries of which most are from the agriculture sector and the rural populace. The Bengal government gives an annual subsidy of Rs 1,000 crore to the consumers.
The state government has strongly opposed the proposal that "...the Appropriate Commission shall fix tariffs for the retail sale of electricity without accounting for a subsidy, which, if any, shall be provided by the government directly to the consumer". Instead, the state has stated that the issue of giving subsidy be left to the state government and the SERC.
It has been further stated by the Mamata Banerjee government that reducing cross-subsidies based on the Central government policy is definitely not in accordance with the Concurrent nature of the electricity sector. "Moreover, there are a number of state-specific issues relating to the power procurement mix, sales and demand profile, etc which cannot be accounted for a pan-Indian policy," the Bengal government has stated adding that the states should retain the right to finalise the tariff structure so that the viability of the Discom, for which the cross-subsidy trajectory should be fixed by the SERC and not by the Central Government.
The issue related to the Ministry of Power's move of introducing the Bill comes at a time when the Bengal government has witnessed destruction due to Amphan in which infrastructure of the state's power sector in 16 districts was badly affected and immediate release of around Rs 300 crore is needed.
The state has also given its strong reservation on freely allowing "open access", apprehending that the independent power producers would enter the distribution market at the cost of existing Discoms as distribution sub-licensee (DSLs), without technical feasibility, which will adversely affect the revenue of the Discoms.