NEW DELHI: The Center will introduce a bill in the Lok Sabha today to remove the license system in the electricity distribution sector and give a chance to private companies, amid opposition from Kerala. The Bill was listed in previous sessions of Parliament but was not introduced.
Nationwide power sector employees are protesting against the amendment. On August 5, 2021, the Kerala Legislative Assembly unanimously passed a resolution against the amendment bill. Apart from Kerala, Bengal also opposed the bill.
Amendment
With the bill, the central government aims to increase capital investment and competition in the distribution sector. Once the amendment comes into effect, the monopoly of state electricity boards in the distribution sector will end. Any company can buy and sell electricity. The user can choose the service provider of his choice.
Criticism
Criticism is that this will pave the way for private companies to control the distribution sector. The amendment allows private entrepreneurs to be allowed and license not required. The central government will determine the eligibility of private entrepreneurs. Neither the state government nor the regulatory commission has any control over these entrepreneurs.
Private entrepreneurs will have rights to existing distribution systems and share of electricity generated. But there will be no obligation to provide electricity to everyone. For this reason such companies tend to concentrate only in urban areas. This may cause loss to the government’s distribution companies and there may be uncertainty in matters including cross subsidy to rural areas.
New companies may also be given the opportunity to exploit existing supply chains. The maintenance of this network will also become the responsibility of the public sector.
The state government wants the center to withdraw
Thiruvananthapuram – Kerala points out that with the intrusion of private entrepreneurs in the power supply sector, domestic users will be neglected and public sector power companies will be in crisis.
Minister K. Krishnankutty demanded that the Electricity Amendment Bill makes electricity inaccessible to farmers and common people and the central government should withdraw from this move. Last year, when the draft bill was received for the state government’s opinion, the government’s views and strong opposition were conveyed to the Center in writing.
Employees to boycott work today
The Kerala unit of National Coordination Committee of Electricity Employees and Engineers (NCCOEE) has announced that as part of today’s nationwide strike by electricity employees, they will boycott work in Kerala as well. The Samyukta Kisan Morcha has also called for a strike. However, there is no boycott of monsoon-related activities and relief work.
Working president of Kerala Electricity Employees Confederation (INTUC) CB Kutty Francis has announced that the work will be boycotted today.
English Summary: Electricity amendment bill in Lok Sabha