The amendments will allow private distribution companies to selectively access high-value customers, and give them access to distribution networks without any investments or any responsibility to maintain them, CM Stalin pointed out

Tamil Nadu Chief Minister M.K. Stalin wrote to Prime Minister Narendra Modi on Wednesday seeking his urgent intervention to defer the proposed amendments to the Electricity Act, 2003 as they have “far-reaching detrimental implications for the State DISCOMs”.

Mr. Stalin said the amendments to the Bill proposes to de-license the distribution sector of electricity by introducing a concept of ‘Distribution Company’ and the deemed registration of any such distribution company after 60 days of application. “This step will give unbridled access to private players to supply power to select consumers and enable them to use the already laid out distribution network of the Public Sector Power Companies. While the State PSUs carry the burden of investment in such networks, these private companies are being allowed to use the same without any investment or any responsibility to maintain it,” Mr. Stalin said.

He said such new private distribution companies would be able to selectively access all the high-value customers in commercially viable areas which would amount to granting them “a right to cherry pick profitable ventures without any social obligations” while the State public sector power utilities will be left with the obligation to supply power to subsidised categories of consumers and to service the economically-backward and rural areas.

Further, the proposed amendments to Sections 26, 28 & 32, by giving powers to the National Load Despatch Centre (NLDC) such as integrated operation of the power system, optimum scheduling of electricity across different States and regions, monitoring of grid operations and giving directions to RLDC or SLDC, would amount to indirectly controlling many significant functionalities of the SLDCs or Discoms of State governments, the Chief Minister said. He said the penalty to be levied under Sec. 142 for contravening provisions of the Act or directions or orders of the Commission was also high.

“In any case, it may not be appropriate to cover the non-fulfilment of Renewable Purchase Obligation (RPO) under Section 142, considering that renewable power availability is infirm by nature and hence a power utility may not be in a position to achieve its RPO due to various genuine reasons like disruptions due to natural calamities,” he said.

Mr. Stalin asked the Prime Minister to personally intervene to withdraw the Electricity (Amendment) Bill, 2021 and allow the State owned Distribution Licensees to continue to supply quality power at affordable rates to the people.