The Hindu Business Line : Govt to revisit power open access surcharge issue

THE MINISTER FOR POWER, Mr Sushil Kumar Shinde, flanked by the Power Secretary, Mr R.V. Shahi (left), and the FICCI's past President, Mr Y.K. Modi, at the inauguration of `India Electricity-2006' in the Capital on Thursday. — Ramesh Sharma

New Delhi , May 11

Under fire from the power sector regulatory establishment, the Government is planning to revisit provisions of the National Tariff Policy to allow State Electricity Regulatory Commissions the leeway to fix the open access surcharge formula for their respective States.

The open access surcharge is a key provision in the enabling framework to enable high-end consumers to select the electricity suppliers of their choice under the open access regime envisaged in the Electricity Act 2003.

The National Tariff Policy, announced by the Power Ministry in January, had stipulated a single uniform formula for all state regulators to calculate the cross-subsidy surcharge for open access in distribution.

The surcharge is basically a payment to be made by a consumer to compensate his existing electricity supplier for having moved to another distribution company.

However, regulators had raised the ante against the move by the Centre on the grounds that one uniform formula was difficult to apply in different states and wanted the flexibility to fix the formula for open access surcharge.

Endorsing the regulators' view, the Power Secretary, Mr R.V. Shahi, today said: "India is a large country and it is difficult to apply one formula for everyone.

"The issue of surcharge needs to be revisited. The Ministry is working on the issue to see how flexible it should be made.

"This should happen very soon," he said at the Indian Electricity 2006 seminar here today.

The Central Electricity Regulatory Commission Chairman, Mr A.K. Basu, who also heads the Forum of Regulators, said the surcharge was the only major unresolved issue in the Policy, since as per the prescribed formula there was a wide variation in the surcharge in different states. Asked on how would the policy be changed, Mr Basu said that it was for the Government to decide on the issue.

"But it is a Cabinet decision and may require an amendment," he said.