Power engineers to boycott work over electricity amendment bill

Electricity ( amendment ) bill
Power sector engineers to boycott work
Monday July 20, 2015
New Delhi
Power engineers will boycott work on the day when the bill is presented in Parliament. This is in line with the decision of All India Power Engineers Federation and National co-ordination committee of electricity employees and engineers to go on one day strike.
V K Gupta Spokesperson of Federation said that the amendments in electricity bill are not been based upon ground realities but are meant only to watch the interest of private players and financially bankrupt the state sector Discoms. The amendments in electricity bill which seeks to segregate the power distribution network from electricity supply business is basically anti people and does not look at root cause of power sector ailments but only treat the symptoms of problems.
The electricity (amendment) bill Distribution and retail supply is the most critical link in the electricity market, which interfaces with the end customers and provides revenue for the entire value chain. By separating carriage and content in the power distribution sector, the electricity bill, in one stroke make all the power utilities in public sector totally unviable.
The Government is likely to move the Electricity (Amendment) Bill in the Parliament in next few days after the approval of cabinet. If bill is passed in Parliament the tariff would increase by the addition of supply licensees and the financially bankrupt Discoms would be left only to cater to subsidized consumers and people living below poverty line. It may be mentioned that service providers will use the already laid out distribution network of state Discoms without any investment or any responsibility to maintain the network.
The losses of state Discoms have already gigantic proportions and are threatening to derail the banking sector. The bank’s exposure to power sector .has already touched the Rs. 2 trillion figures today. But the financial rot in some state electricity boards has only worsened since banks restructured loans to these entities under the financial restructuring proposal in September 2012.Less than three years later, as the moratorium on principal repayments included in the restructuring packages, comes to an end, bankers are fearing defaults from most of the state electricity boards which accepted the restructuring plan.
The separation of distribution business content and carriage – involves significant costs and may be difficult to reverse. There are risks associated with it that need to be taken seriously. The issues of the ageing infrastructure of distribution network have been acknowledged for quite some time.

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6 Responses

  1. Aditya kashyap says:

    Dear sir, you are saying that power tariff will increase by this amendment but i have some concerns about your post. Every year discoms are saying that their AT& C losses are very high but not taking steps to control it. India power sector is regulated market so why having fear of increased tariff. Even this amendment will give discoms new business to earn from wheeling charge. And if we want subsidy or lower power tariff than either genco have to shut down their power plant just because of non-repayment of discoms or govt have to give too much subsidy which will be a big hurdle for development of country

    • V K Gupta says:

      The Discoms will lose business of supplying power to consumers as middle man will enter the picture who will supply power to creamy layer of consumers. The middle man will not invest any money in infrastructure and will simply earn profits as per bill.The high end consumers who want round the clock supply under any circumstances will not mind extra charges but about the consumers who are still to get connections.

      • Aditya kashyap says:

        Dear sir, As per proposed act, No one is going to stop Discom to supply electricity. Actually it is giving opportunity to customer to purchase electricity from open competitive market,( just like UK Market) and it will also cause to reduce tariff. Remember the day of BSNL monopoly and compare today’s market. New player is going to pay wheeling charge for the infrastructure what they are going to use as TATA Power is paying in Mumbai. This wheeling charge will also increase their revenue without investment of single penny.

  2. ponraja says:

    Dear Sir, I have few questions like why this discoms are in loss even after debt restructuring? may be due to the low tariff and high distribution and commercial loss. Tariff determination in India is influenced by politicians but what about distribution and commercial loss which is around 18%-20%. even if we bring down this loss to 12-14%, it will generate good revenue for discoms but I am aware of some discoms and distribution franchisee have brought down losses in past but what is stand of govt. discom? as Torrent in bhiwandi , BSES , TATA in Delhi and TATA in Mumbai had bring down losses significantly. when SEB’s were in market as monopoly they played enjoyed it but now other private companies in market are performing effectively than them. Enough time had given to them to perform. this act is also giving them to chance to operate so discom should concentrate to work effectively and compete with others

    • IndianPowerSector.com says:

      You c
      have given answer to your question yourself. The tariff determination is still influenced by elements other than market forces , further state DisCom needs improve there standards of service, but above all its responsibility of citizen of India to pay for electricity they are consuming and do not support corruption.

  3. raaj says:

    if they permit book balance will taake 10 years and annual account clsoure ages .. if experience of UK is any indication, if such option is extended to low power
    SERC have imposed enough restrictions on such option to make it still born

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