Open access to consumers yet to take off

Open access to consumers, especially for 1 megawatt and above, is yet to take off on a large scale. Ironically, the Economic Survey, tabled in the Parliament on Wednesday, was completely silent on this aspect, even as it mentioned open access at inter-state level was now fully functional.

During 2011-12, inter-state short-term open access transactions (including bilateral and collective) were approved for the sale of 66,987 million units (MU). During 2012-13 (up to November), the sale of 48,008 MU had been approved through 21,185 inter-state bilateral and collective short-term open access transactions.

The facilitative framework, created through the Central Electricity Regulatory Commission (CERC) (Open Access in Inter-State Transmission) Regulations, 2008, provided regulatory certainty for sellers and buyers through the market and also security of payment against default by buyers.

However, despite regulatory initiatives and the power ministry's intervention, states are reluctant to implement the open access system largely due to the existence of cross subsidies in tariff, high open access charges and non-availability of surplus power at reasonable rates.

Moreover, states are invoking section 11 of the Electricity Act, 2003, which empowers them to direct power companies to operate and maintain generating stations under "extraordinary circumstances".

States such as Karnataka, Tamil Nadu, Odisha and Andhra Pradesh have invoked section 11 to prohibit export of power from their state treating "power shortages" as extraordinary circumstances. Several orders of CERC preventing misuse of section 11 have been challenged in high courts. CERC and the power ministry have moved the Supreme Court against a Karnataka high court order in this regard.