Electricity Amendment Bill Likely In Budget Session

India's power minister said the government is expected to introduce the Electricity Amendment Bill that provides for 24x7 power and direct benefit transfers in the budget session.

The new law will impose hefty fines on discoms for outages, Union Minister for Power RK Singh told reporters on the sidelines of an event on Wednesday.

That's in line with the government's Rs 16,320-crore Saubhagya scheme to provide electricity in all urban and rural households by December. The scheme aims to provide power to about 3 crore unlit homes.

The existing law imposes a universal service obligation on power distributors to provide electricity to all and the penalty for non-compliance can go up to Rs 1,000 a day. “We are working on increasing the penalties on discoms,” Singh said.

Eliminating Cross-Subsidy

Singh said the government plans to do away with cross-subsidy in the national tariff policy to provide a big relief to industrial consumers. Industries pay a higher tariff so that electricity to household consumers can be provided at lower rates.

“I have already told states that cross-subsidy cannot be allowed beyond 20 percent. States will have to modify their tariffs,” Singh said. “States are charging as high as 100 percent. I intend to move towards a regime whereby even that 20 percent. Let me discuss this with the states. States will be very uncomfortable.”