Rajasthan moots power sector reform law

Taking a major step forward in the power sector reforms, the Rajasthan government has circulated a draft of a new electricity Bill aimed at providing "universal access to reliable and affordable electricity" by eliminating "inter-connected chain of monopolies".

The draft of the proposed Bill, prepared by Gajendra Haldea, chief advisor of the National Council of Applied Economic Research, had been circulated for creating a consensus by inviting comments and suggestions, an official spokesman said.

Though Rajasthan was the first to initiate the power sector reforms in 1999 by debundling its state electricity board and setting up five different power utilities and a regulatory commission but further reforms like privatisation of power utilities were bogged down.

The proposed legislation, in accordance with the Electricity Act, aims at "restructuring, de-centralising, opening up and making accountable the present monopolistic functioning of power sector," the spokesman said.

Though the power sector was capital-intensive and was sustainable only on commercial principles yet the state's intervention, both in the form of policy and action for less privileged, would be ensured in the proposed Bill, he said. The draft Bill provided for "enabling framework necessary for attaining gro-wth with equity," he added.

The draft stipulates a "state- specific industry structure" aimed at eliminating inter-connected chain of monopolies that "withhold consumer choice, and competition is expected to bring about efficiency improvement and cost reduction".

The Bill also addresses several flaws in the regulatory framework and makes the regulatory panel, set up under the Rajasthan Electricity Reforms Act in 1999, accountable to the legislature and the people.

It also provides for establishment of "bulk electricity market" within three years to facilitate efficient competitive and orderly trading and supply of electricity.