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CM urges PM to withdraw proposed changes in Electricity Act

Chief Minister K. Chandrasekhar Rao has requested Prime Minister Narendra Modi to withdraw the amendments proposed in the Electricity Act highlighting the concerns of Telangana State.

In a two-page letter addressed to the Prime Minister on Tuesday, Mr. Chandrasekhar Rao said the proposed amendments would take away certain functions and powers of the State government, including the provision to appoint State Electricity Regulatory Commission. “It is hitting on the core of the federal polity,” Mr. Rao said. Merely because a particular subject is in the Concurrent List of the Constitution does not mean that the Centre/Parliament would enact laws having direct and major influence on the functioning of a State government.

On the provision for direct benefit transfer (DBT) of subsidy provided to consumers, particularly to agriculture and domestic sectors, would work against the interest of farmers and domestic consumers from the downtrodden sections. Any proposal to modify the current statute on DBT was highly objectionable to Telangana government since it was providing 24×7 free power to farm sector. The provision for fixing tariff for all consumers without subsidy by the ERC would take away the cross-subsidy facility, he stated.

The Telangana Chief Minister felt that any national renewable energy policy should be formulated with explicit consent of the State governments but not simply in consultation with them. “Each State in India has its own unique situations like potential for hydro, wind and solar power, land availability and others,” Mr. Rao said adding that States should have the flexibility to determine within the broad policy at the national-level without any penal provisions.

Stating that one of the proposed amendments is to make National Load Despatch Centre all powerful in scheduling of power throughout the country, the Chief Minister said Telangana SLDC was implementing merit order despatch of energy satisfactorily. Although grid discipline is very important, it is not advisable to entrust NLDC with additional powers to order backing down of State thermal units and they would not be able to compete with central generating stations, he noted.

Mr. Chandrasekhar Rao said the cost of generation of central power utilities such as NTPC and NHPC would be less and get priority in merit order despatch causing loss to State utilities and suggested that intra-State transmission decisions be left to the SLDCs only. He also opposed the provision to empower NLDC to enforce payment security and suggested that such commercial aspects be left to State ERCs and courts. Instead, NLDC should deal with only technical issues such as scheduling and grid stability.

On free open access provision in the amendments, the Chief Minister said it would erode revenue of discoms with many consumers with more than 1 MW load could go for open access without any technical feasibility.

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