The AIPEF warned against any unilateral rush-through of proposed amendment Bill in Parliament, which will force 1.5 million power employees and engineers to go on a lightning strike, in protest. The Federation submitted its comments on the draft Electricity (Amendment) Bill 2018 to Union Power Minister RK Singh, running into 22 pages, and demanded that the revised draft be again sent to the Standing Committee of Parliament and the Federation be given a hearing, to present its view point. The AIPEF urged that the states should also be allowed to give their views before the Committee, as Electricity is a concurrent subject.

AIPEF Chairman Shailendra Dubey said here in a statement that in the proposed Amendment, there will be separate supply licences, Incumbent supply licence and Intermediate Company, to handle all Power Purchase Agreements (PPAs). In the present scenario, every state pools the availability of power and implements merit order dispatch at state level, so that energy requirement is met at the least cost, Mr Dubey pointed out. With the proposed set-up, how the Intermediary Company will implement the merit order with multiple supply licences is not known and it will be an impossible task. It will lead to endless disputes as each licensee will claim power from the least cost PPAs and it will result in problem of the stranded PPAs becoming unmanageable, he added.

He said presently, the Central Electricity Regulatory Commission (CERC) and the State Electricity Regulatory Commissions (SERCs) are guided by tariff policy, whereas in the draft amendment, tariff policy will become mandatory. This will make the CERC, as well as all SERCs subservient to policy dictates of the Central government, issued through Section 3 of the Act. The Regulators will no longer be Independent and distanced from the government.

Mr Dubey said the changes in the draft bill have been proposed to pave the way for privatization of power sector, wherein supply licensees will be mostly from private sector and the licensee will get assured profit by way of guaranteed return on capital employed and by stipulating that licenses will get their expenses covered without revenue gap. It can be said that the changes in tariff have been proposed to encourage privatisation and ensure guaranteed profits to private parties.

The draft amendment proposes that the cross subsidy payable to different set of consumers within the distribution area will be reduced progressively and eliminated in a period of three years. This is a policy matter for each state to decide. Further, any subsidy payable to a consumer will be through the provision of direct benefit transfer and this proposal is practically unworkable and sure to fail, it added.

The AIPEF Chairman said that when most of the State DISCOMS of the country are in financial distress, this is not the time or occasion to introduce changes by way of separating supply and distributing functions, rather it will worsen the financial crisis.