Govt plans to impose ₹1-cr penalty on entities violating Electricity Act

Seeking to make penal provisions more stringent in the power sector, the government has proposed imposing a fine up to ₹1 crore on entities violating norms under the Electricity Act.

The proposed penalty limit will be a steep jump from the current ₹1 lakh under the existing provision.

The provision is a part of various amendments proposed by the government to the Electricity Act, 2003.

In this regard, the Electricity (Amendment) Bill, 2014 was introduced in the Lok Sabha on Friday and was later referred to the Standing Committee.

If the proposed amendment comes into force, entities violating the norms will be liable for punishment that could also mean imprisonment for three months.

It could be both in the “case of continuing failure, with an additional fine which may extend to ₹1 lakh for every day during which the failure continues after conviction of the first such offence,” as per the Bill.

These norms will replace the provision in the current Electricity Act where the penalty can be only up to ₹1 lakh.

With respect to a generating company that produces renewable energy, the Bill states that in case of violations, the person concerned could face up to three months’ imprisonment. For the particular generating company, the penalty could extend up to ₹10 lakh and in case of continued failure to comply with the norms, the fine could be ₹10,000 per day.

According to the Bill, none of the proposed provisions will be applicable to the orders, instructions or directions issued under Section 121 of the Act.

This section pertains to the powers of the Electricity Appellate Tribunal.

The government has said amendments proposed in the Bill will usher in the much-needed reforms in the power sector.

Among others, the Bill has also proposed measures to enhance safety and security of electricity grids, separation of carriage and content in the distribution sector, and promotion of renewable energy.

“It (amendment) will also promote competition, efficiency in operations and improvement in quality of supply of electricity in the country resulting in capacity addition and ultimate benefit to the consumers,” the government said.

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