The amendments proposed to Electricity Act 2003 will wreck state-run Kerala State Electricity Board Limited (KSEBL) financially, ending the cross subsidy regime and leading to hiked power tariffs, according to the Power Department and the unions in the sector. The proposed amendments are back in the spotlight with the monsoon session of Parliament beginning on July 21 likely to take up the Bill. Anticipating such a likelihood, unions in the power sector, including those in Kerala, have served strike notices.
The major threat perceived by both unions and state-run power utilities is the move to segregate 'content' and 'carriage' in power distribution.
In essence, allowing private players to use existing networks of lines and related installations (in Kerala, those belonging to the KSEBL) to supply power to consumers. While the declared intention of the Centre is to increase competitiveness, in practice this will lead to private players drawing away the high-end consumers, leaving state-run utilities like the KSEBL and its subsidised categories of consumers in the lurch, the unions say.
"Now the average domestic tariff is Rs 2.50. Once the subsidies go, tariffs will have to go up," said M G Suresh Kumar of the KSEB Officers' Association.
"Once the commercial and HT/EHT consumers are lured away by private suppliers with lower tariffs, 40 to 50 per cent of the revenue will go in addition to one-third of the KSEBL's business,'' he added.
The unions served strike notices on July 8 with the intention of launching it on the day the Bill comes up in the Parliament.
Kerala has formally conveyed its reservations about the amendments to the centre, KSEBL chairman M Sivasankar said.
While it would be possible to retain the KSEBL in the public sector, it would be reduced to serving only the low tariff-paying domestic consumers and the highly-subsidised weaker sections, Electricity Minister Aryadan Mohammed had informed the Assembly on Tuesday in a written reply. He pointed out that all the government can do is urge the Commission to set stringent conditions for allowing new supply licences in the state.
source- Indian Express