BJP-ruled Gujarat, Madhya Pradesh join chorus against electricity Bill changes

Prime Minister Narendra Modi’s strong pitch for “cooperative federalism” notwithstanding, states are getting more vocal about being kept out of the consultative process on policies being formulated by the Centre.

BJP-ruled Madhya Pradesh and Gujarat are among the states that are learnt to have opposed the amendments proposed to the Electricity Act, 2003.

These two states, along with Tamil Nadu and Orissa, have also pointed specifically to the lack of consultation with state governments on the provisions of the Bill, which is currently being examined by the Parliamentary Standing Committee on Energy.

In the light of the states’ opposition, the Standing Committee is learnt to have asked for more time to draw up its recommendations.

Last month, the Centre’s move to amend the Factories Act, 1948 came in for criticism from the BJP government of Goa which, in a specific intervention before a Parliamentary panel, flagged its reservation against a proposal in the Factories Amendment Bill, 2014.

This provision sought to remove the definition of “hazardous process” as contained in Section 2 of the principal Act, along with a list of 29 such processes and, instead, bring in a new sub-section 2(cc) that substituted the term “hazardous process” with a list of “hazardous substances”.

Earlier, at the end of December, several states, including Kerala, Punjab, Madhya Pradesh and Rajasthan, hit out at the proposal in the Centre’s draft civil aviation policy to develop only six international airports as travel hubs, citing significant international traffic — both in terms of aircraft and passenger movements — at their airports.

According to officials involved in the Standing Committee on Energy deliberations on the Electricity (Amendment) Bill, 2014, Madhya Pradesh and Tamil Nadu have specifically opposed the broad premise of the Bill, while Gujarat and Orissa have expressed reservations against some of its provisions.

The Standing Committee is slated to meet again on March 11 for consultations with industry representatives.

In their deposition before the parliamentary panel, the states have said that the provisions of the Bill were not discussed with them, even though electricity is a Concurrent subject. They have sought clarifications from the Centre on whether the proposals have been benchmarked against international models, and whether adequate diligence has been done on the legislation, which promises radical reform in the power sector and envisages the advent of multiple suppliers on the loss-laden distribution side.

The proposal is facing flak for a fundamental flaw — that even after competition at the retail level is introduced, consumers will still have to deal with the same monopoly wire service provider for getting a new connection, in case of breakdowns or faults, billing or metering problems, or for a change of load.

The scheme for the separation of “carriage and content” incorporated in the Bill aims to eliminate the territorial distinction among electricity distribution companies in each state, and envisages multiple supply licencees on the consumer end — competing with each other, with the retail consumer having the option to migrate from one supplier to another.

The proposal has been billed as a gamechanger with potential to usher in competition in the electricity sector on the lines of the telecom sector. However, concerns stem from the fact that even after competition is opened in the retail sale of electricity, the consumer will remain connected to the monopoly network service provider or wire company.

Source:: Indian Express