Power Regulatory Panels Essential, Says Chamber

The Phdcci has urged the government to expedite the setting up of central and state electricity regulatory commissions to bring about stability in the power sector.

While too much emphasis is being laid on increasing generation, not much attention has been paid to the T&D network, the chamber said. Regarding privatisation of distribution, it called for a standard agreement between licensees and the SEBs.

The Phdcci said the government had adopted a piecemeal approach in announcing guidelines for private sector participation.While amendments had been made in the Electricity Supply Act to allow private players, no effort had been made to amend legal and structural framework governing the power industry.

There was an urgent need to expedite the process of scrapping the two outdated electricity acts and putting a new act in place, the chamber emphasised.

Another lacuna is the fact that some of the states had refused to follow the guidelines laid down by the central government. This had again put the power producers in a peculiar situation, the note said.

In this context, the chamber suggested that all power projects with investments of upto rs 1000 crore need not be referred to the central government for approval.

In spite of the massive growth in generation capacity, severe power shortages persist throughout india. Energy deficiency is approximately 11 per cent and peaking shortage 18 per cent.

Capacity addition has fallen far short of consumption growth. The gap between demand and supply has widened over the last five years and is expected to increase in the short term, the phdcci note pointed out.

Domestic, industrial and irrigation sector consumers utilise over 85 per cent of indias electrical energy. Per capita consumption has grown from 15.6 kwh in 1950 to 314 kwh currently, but this is still much lower than consumption standards prevailing in developed economies.