Lok Sabha Question No. 4768 (UNSTARRED), answered on 2017-03-30
Subject: Power Tariff
Ministry: POWER
Asked by: PRATHAP SIMHA, SHOBHA KARANDLAJE

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.4768 TO BE ANSWERED ON 30.03.2017

## POWER TARIFF

4768. SHRI PRATHAP SIMHA: KUMARI SHOBHA KARANDLAJE:

Will the Minister of POWER be pleased to state:

- (a) whether the Government has set up a Committee to look into the issues relating  to  restructuring  of  tariff  so  as  to  reduce  the  burden  on  industrial/ manufacturing  units,  by  making  domestic  and  commercial  consumers  of electricity pay more;
- (b) if so, the composition and mandate  of the Committee  and  the recommendations made by it;
- (c) the justifications for seeking reduction in tariff applicable to industrial/ manufacturing units;
- (d) whether  the  provision in the Electricity Act, 2003  requires  bulk electricity consumers to pay an Open Access Surcharge (OAC) to SEBs, whom they want to leave, rendering switch to new supplier uneconomical and if so, the details thereof;
- (e) the  measures  taken  by  the  Government  for  a  viable  and  sustainable solution  to  the  problem  of  high  tariff  currently  charged  from  manufacturing units within the framework of fundamental causes; and
- (f) whether  the  Government  proposes  to  urge  the  States  to  step  giving subsidized/free  power  to  farmers/  households  and  curb  theft  and  if  so,  the details thereof?

## A N S W E R

THE MINISTER OF STATE (INDEPENDENT CHARGE) FOR POWER, COAL, NEW & RENEWABLE ENERGY AND MINES

( SHRI  PIYUSH GOYAL )

- (a)  to  (c)  :    No,  Madam.  However,  the  Government  of  India,  vide  order dated 30th August, 2016 and 7th  September, 2016, has set up a Committee headed by Special Secretary, Ministry of  Power to  suggest  measures  to rationalize tariff structure, conduct comparative analysis of tariff structure prevailing in different States and also to suggest a roadmap for reduction  of  the  tariff  vis-à-vis  recovery  of  all  prudent  cost  incurred  by Discoms.

……….2.

(d) : Section 42 of the Electricity Act, 2003 inter-alia provides that open access shall be allowed on payment of a surcharge and additional surcharge, apart from the charges for wheeling as may be determined by the  State  Electricity  Regulatory  Commission  (SERC)  to  compensate  the utility for existing cross-subsidies and stranded assets being the provider of last resort.

(e) & (f) : The  tariff  of  different  categories  of  consumers,  including manufacturing units in the States is determined by the respective State Electricity  Regulatory  Commissions  (SERCs)/Joint  Electricity  Regulatory Commissions  (JERCs),  based  on  the  principles  enunciated  under  the Electricity Act, 2003 and policies framed thereunder. The State Governments can give subsidy to any category of consumers to the extent they consider appropriate as per the provisions of Section 65 of the said Act,  as  well  as  Clause  8.3  of  the  Tariff  Policy.  There  is  no  provision regarding direct control of the electricity tariff by the Central Government.

However, through appropriate policy framework and programmes,  the  Government  is  promoting  efficiency  in  generation, transmission and distribution business as also supporting strengthening of the distribution and transmission infrastructure, with a view to reduce the Aggregate  Technical  and  Commercial  (AT&C)  losses.  These  measures, alongwith  the  Government's  emphasis  on  discovery  of  tariff  through competitive bidding, contribute towards lowering power purchase cost of Discoms which ultimately  result  in lower tariff.

As regards, curbing of power theft, the Electricity Act, 2003 provides  a  legal  framework  for  making  theft  of  electricity  a  cognizable offence.  For  checking  theft  of  electricity,  the  Electricity  Act,  2003  has incorporated  specific  provisions  for  detection  of  theft,  speedy  trial  of theft  related  offences  and  also  for  the  recovery  of  the  charges  of electricity stolen.

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