Chief Minister Arvind Kejriwal on Saturday said the proposed Amendment Bill to the Electricity Act, 2003, which the Central government is likely to bring in the next session of Parliament, would lead to a “steep hike” in power bills for consumers, while benefiting “certain select big power companies”.
Addressing a press conference at his residence, the Aam Aadmi Party convener said the Centre had sent the draft amendment to all State governments on September 7, giving them 45 days to get back with their comments.
“The amendments have been aimed at benefiting two big power generation and distribution companies that are good friends of Prime Minister Narendra Modi,” he said.
Cross subsidy
Mr. Kejriwal said since the amendment would do away with cross subsidy, which enables lower tariffs for domestic consumers and higher for commercial, power would become “two to five times” more expensive in Delhi, even with the AAP government’s subsidy of ₹2/unit remaining.
“One unit of electricity in Delhi costs ₹7.40 to generate. With cross subsidy, we are able to charge the weakest sections less and the commercial or industrial sectors more. If the cross subsidy is done away with, then everyone will be charged ₹7.40 unit. Even with our subsidy of ₹2/unit, people will have to pay ₹5.40/unit, which is more than five times the existing rate of ₹1/unit for consumers of less than 200 units,” he said.
He said the draft amendment proposed to cap the cross subsidy to 20% immediately and to do away with it completely in three years. Apart from that, he said “futures trading” would be allowed in the power sector for the first time, leading to the possibility of the cost per unit of electricity to go up from the existing ₹7.40/unit.
He also said the States would be rendered “powerless” when it comes to deciding matters related to electricity, as the State Electricity Regulatory Commissions would no longer be appointed by a majority of State representatives.
Currently, two members of the three-member selection committee for State Electricity Regulatory Commissions are appointed by the State and one by the Centre.
The amendment aims to change this to a six-member committee, comprising four Central government’s nominees. In addition, he said the amendment would enable the Centre to issue tariff policies to States.
Will write to other CMs
“I will be writing to all Chief Ministers day after and visiting the non-BJP State CMs to ask them to oppose this amendment. I will also ask the leaders of the non-BJP parties in Rajya Sabha to oppose this amendment,” he said.
He questioned the decision of the government to bring such an amendment right before the Lok Sabha elections.
“I don’t understand the political logic of brining such a dangerous Bill a few months before elections. Some say they [Modi government] have a setting with power companies that they will do this [pass amendment] for them in exchange for help in elections or to return an earlier favour,” he said.
He added that the AAP would launch a public campaign against the amendment if needed.