Alagh Keen On Early Clearance For Power Regulatory Body

Power minister Y K Alagh has asked his ministry officials to expedite the proposal for setting up a power regulatory commission for cabinet clearance so that the necessary bill could be introduced during the monsoon session of Parliament.

The private sector will not come forward with their funds till they are confident of returns and the government has to take an early decision over the next three months on power sector reforms for desired capacity addition in ninth plan, Alagh said.

If we can create confidence that an efficient producer will get rate of return by passing the tariff regulatory agency legislation, an additional about 3,000 to 4,000 mw capacity investment would come in the plan period, he said.

 

Other measures suggested by him for augmenting power capacity included co-generation projects between the government and the private sector, captive power besides measures to improve transmission and distribution systems.

As per the ministrys calculation, capacity addition from the private sector over the next five years will not exceed 15,000 mw as against the ninth plan working group estimates of about 28,000 mw, ministry sources said.

The ministrys calculation of 15,000 mw contribution from the private sector includes about 4,000 mw from the fast track projects for which the Centre is giving counter-guarantee.

Against the projection of 57,735 mw by the working group, the ministry is veering around to a more modest target of about 40,000 mw, consisting of 11,000 mw each from central and state utilities and 18,000 mw from private producers, the sources said.The issue of tariff rationalisation and the setting up of the Central Electricity Regulatory Commission (CERC) had been hanging fire for quite some time and Prime Minister I K Gujral is understood to have asked the power ministry to send the proposal to his office at the earliest.

An earlier proposal for the cabinet sent by the power ministry was reportedly referred to a committee of secretaries by the cabinet secretariat to clarify the composition of the regulatory body apart from specific areas of operation.

The proposal was referred back to the power ministry for certain changes, barely days before the cabinet reshuffle which saw Alagh take over from S Venugopalachari and P Abraham handing over charge as secretary to E A S Sarma.

Alagh said he would take specific issues with the concerned ministries so that a comprehensive and concise policy could be put in place effectively for realising the ninth plan targets.

He admitted that private investment was coming in states like Gujarat, Maharashtra, Karnataka, Tamil Nadu and Andhra Pradesh, where state electricity boards were placed in a better financial condition.