The Ministry of Power started functioning independently with effect
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India’s
Electricity Sector –
Widening Scope
For
Private Participation
Investment Promotion Cell
INDEX
TABLE OF CONTENTS
Sl. Description
1.
Introduction
General
2.
Abbreviations
3.
Ministry of Power
4.
Statutory Bodies
5
New initiatives in the power sector- A brief
6.
Reforms & Restructuring in States- Milestones/ Status
Electricity Act, 2003 (10.06.2003)
7.
Part-I - Preliminary
8.
Part-II - National Electricity Policy and Plan
9.
Part-III - Generation of Electricity
10. Part-IV - Licensing
11. Part-V - Transmission of Electricity
12. Part-VI - Distribution of Electricity
13. Part-VII - Tariff
14. Part-VIII - Works
15. Part IX – Central Electricity Authority
16. Part X - Regulatory Commissions
17. Part XI – Appellate Tribunal For Electricity
18. Part XII – Investigations & Enforcement
19. Part XIII – Re-organisation of Board
20. Part XIV - Offenses & Penalties
21. Part XV – Special Courts
22. Part XVI – Dispute Resolution
23. Part XVII – Other provisions
24. Part XVIII – Miscellaneous
25. The Electricity (Amendment) Act, 2003 dated 30th December, 2003
Notifications & Resolutions
26 Review of policies – Supercession of outdated circulars and guidelines.
27 National Electricity Policy (12.02.2005)
28 CERC (Terms & Condition of tariff) Regulations, 2004 (26.03.2004) and (1st Amendment)
Regulations, 2004 dated 3rd September, 2004
29 Tariff Filing Forms (26.3.2004)
30 Open Access in Inter-state Transmission / CERC (30.01.2004) & (1st Amendment)
Regulations, 2005 dated 21st February, 2005
2
31
32
33
34
35
36
37
Electricity Trading License / CERC (30.1.2004)
List containing clearances required for power projects
Environmental delegation orders
Amendment in Environment (Protection) Rules, 1986 (19.09.1997)
Use of raw/ blended/ beneficiated coal in TPSs (3.7.1998)
Coastal Regulation Zone and Amendments
Guidelines for determination of tariff by bidding process for procurement of power by
distribution licensees (19.01.2005)
Mega Power Policy
38 Mega power policy guidelines (13.11.1998)
39 Extracts of Notification issued by Department of Revenue as on 1.3.2003
Project Financing
40 RBI Press release 100% FDI in Pvt Sector
41 Press Note 7(2000) Series
Addresses
39
42 Contact addresses of Ministry of Power
43 Contact addresses: Central Electricity Regulatory Commission
44 Contact addresses: State Regulatory Commissions
45 Contact addresses: Secretary(Energy/Power) -States
46 Contact addresses: Chairman, SEBs /Utilities
47 Contact addresses: CMDs of PSUs
3
INTRODUCTION
The growth of the economy, calls for a matching rate of growth in infrastructure
facilities. The growth rate of demand for power in developing countries is generally higher
than that of Gross Domestic Product (GDP). In India, the elasticity ratio was 3.06 in the first
Plan and peaked at 5.11 during third plan and come down to 1.65 in the Eighties. For the
Nineties, a ratio of around 1.5 was projected. Therefore, in order to support a rate of growth
of GDP of around 7 percent per annum, the rate of growth of power supply needs to be over
10 percent annually. Power Sector, hitherto, had been funded mainly through budgetary
support and external borrowings. But given the budgetary support limitation, due to growing
demands from other sectors, particularly social sector and the severe borrowing constraints, a
new financing strategy is required. This had been recognised by the Government as reflected
in the new policy enunciated in 1991, allowing private enterprise a larger role in the power
sector. This booklet includes the main features of the policy to facilitate private sector
investment in power generation, along with copies of important circulars, notifications, etc.
The initiatives taken by the Government in this direction have also been included in this
edition. The Electricity Act, 2003 is one of such major initiative.
The Electricity Act, 2003 is a very progressive legislation that creates liberal and
transparent framework for development of power sector. Entry barriers have been sought to
be removed in all segments of the power industry, thereby facilitating competition and
ensuring efficiency gains for consumers. The Act provides for several measures to encourage
reforms in the distribution sector in terms of mandatory metering and stringent penal
provisions for theft of electricity. Consumers remain the focal point of the new law, with
specific provisions safeguarding their interests. There are provision for Consumer Grievance
Redressal Forum and Ombudsman to settle consumer’s grievances. State Commissions are
required to specify performance standards of licensees. Failure to comply with the
performance standards makes the licensees liable to pay compensation to the affected person.
The licensees are mandated to give supply to consumers on demand within a stipulated period
failing which they are liable to pay penalty. State Governments are required to constitute
District level committees to review inter-alia rural electrification, quality of power and
consumer satisfaction. The Act also has specific provisions seeking to encourage rural
electrification including local distribution through Panchayats, User Associations,
Franchisees etc. The Central Government is required to formulate the specific policies on
rural electrification - one, on stand alone systems for rural areas and the other on
electrification and local distribution. The Act entrusts on the Appropriate Government the
obligation to endeavour to supply electricity to all areas including villages and hamlets. The
Act encourages licence free distributed generation (i.e. generation & distribution) in a rural
area to be notified by the State Government.
The first major step towards encouraging private investment in the Power sector was
taken in 1991 by providing a legal frame work through an amendment of the then existing
Electricity (Supply) Act, 1948. Subsequently, a definite tariff framework was also put in
place through notification issued by the Government of India. Further, to bring about
rationalization and transparency in tariff setting process, the institution of Independent
Regulatory Commission was created through an enactment in 1998. Under the Electricity
Act, 2003, tariff for supply of power by a generating company to a distribution licensee
through long term Power Purchase Agreement (PPA), is to be determined by the Regulatory
Commission. Tariff for supply involving a short term PPA (one year or less) would not,
however, be regulated. Where open access has been allowed to a consumer, he can reach an
4
agreement with his supplier for purchase of electricity and the tariff for such transaction
would not be regulated. Tariff determined through competitive bidding is also not to be
regulated.
The Government plans to add around 1,00,000 MW of additional generation capacity
during 2002-2012. This capacity has been planned to be added through Central Power
Generation Utilities, State Power Generation Utilities and Private Generation Utilities. The
associated transmission system is to be implemented by Power Grid Corporation of India Ltd.
(POWERGRID), State Power/Transmission Utilities and private transmission entities. An
investment of about Rs. 71,000 Crore is envisaged in transmission under central sector, out of
which POWERGRID has planned to invest about Rs. 50,000 Crore on its own and the
remaining Rs. 21,000 Crore is expected to be brought in by the private investors.
Government of India issued guidelines for private sector participation in transmission
sector in January 2000. These guidelines envisage two distinct routes for private sector
participation in transmission: Joint Venture (JV) Route, wherein the CTU/STU shall own at
least 26% equity and the balance shall be contributed by the Joint Venture Partner and
Independent Private Transmission Company (IPTC) Route, wherein 100 percent equity
shall be owned by the private entity.
Under the provisions of the Electricity Act, 2003, distribution of electricity is a
licensed activity and the license is granted by the appropriate Regulatory Commission.
Thus, any entity / person, whether in public sector, can apply to the appropriate Commission
for grant of distribution licensee.
The Act also provides that the appropriate Commission may grant a licence to two or
more persons for distribution of electricity through their own distribution system within the
same area, subject to the compliance with the additional requirements relating to the capital
adequacy, credit-worthiness, or code of conduct as may be prescribed by the Central
Government. The Act further provides that no such applicant who complies with all the
requirements for grant of licence, shall be refused grant of licence on the ground that there
already exists a licensee in the same area for the same purpose. Central Government has
already notified the additional requirements in this regard.
The National Electricity Policy notified by Central Government under the provisions
of the Electricity Act, 2003 states that private sector participation in distribution needs to be
encouraged for achieving the requisite reduction in transmission and distribution losses and
improving the quality of service to the consumers.
5
ABBREVIATIONS
CEA - Central Electricity Authority
MCMD
Million Cubic Meter per
Day
CERC - Central Electricity Regulatory
SERC
State Electricity Regulatory
Commission
Commission
Crore - Ten million
MOC - Ministry of Coal
CPCB - Central Pollution Control Board MOE&FMinistry of Environment &
CWC - Central Water Commission
Forests
CCFI - Cabinet Committee on Foreign
MOR
Ministry of Railways
Investment
MOP - Ministry of Power
CIL
- Coal India Limited
MOU - Memorandum of
Deptt.Irrg.- Department of Irrigation
Understanding
DPR - Detailed Project Report
MP&NG Ministry of Petroleum &
EOUs - Export Oriented Units
Natural Gas
DOF - Department of Forest
MT - Million Tonnes
ECB - External Commercial Borrowing MU
Million Units
EPC - Engineering, Procurement and
MW
Mega Watts
Construction
NTPC - National Thermal Power Corp
E&F - Environment & Forest
NAA - National Airport Authority
E(S) Act Electricity(Supply) Act, 1948
NHPC National
Hydro-electric Power
FIPB - Foreign Investment Promotion
Corp
Board
PGCL - Powergrid Corporation of
SIG
- Standing Independent Group
India Ltd.
FSA - Fuel Supply Agreement
PLF - Plant Load Factor
FTA - Fuel Transport Agreement PPA - Power Purchase Agreement
FR
- Feasibility Report
RFP - Request for proposal
GOI - Government of India
RFQ - Request for Qualification
HPB - High Powered Board
ROE - Return on Equity
IA
- Implementation Agreement SEB - State Electricity Board
IDC
- Interest During Construction
SG
State Government
IOC
- Indian Oil Corporation
SIA - Secretariat for Industrial
IPC
- Investment Promotion Cell
Approvals
IPP
- Independent Power Producer
SLC
Standing
Linkage
Committee
IRR
- Internal Rate of Return
SPAC - Standing Project Appraisal
KWH - Kilo Watt Hour
Committee
KCal - Kilo Calorie
SPCB - State Pollution Control Board
LC
- Letter of Credit
TEC - Techno-Economic Clearance
LOI
- Letter of Intent
UT
- Union Territory
Ckt. Kms.Circuit Kilometers
CPP Captive
Power
Project
PSU - Public Sector Understandings
ICB
International Competitive
PTC - Power Trading Corporation
Bidding
6
MINISTRY OF POWER
1.0
MINISTRY OF POWER
The Ministry of Power started functioning independently with effect from 2nd July, 1992.
Earlier it was known as the Ministry of Energy comprising the Departments of Power, Coal
and Non-Conventional Energy Sources.
Electricity is a concurrent subject at Entry 38 in List III of the Seventh Schedule of the
Constitution of India. The Ministry of Power is primarily responsible for the development of
electrical energy in the country. The Ministry is concerned with perspective planning, policy
formulation, processing of projects for investment decision, monitoring of the
implementation of power projects, training and manpower development and the
administration and enactment of legislation in regard to thermal, hydro power generation,
transmission and distribution.
The Ministry of Power is responsible for the administration of the Electricity Act, 2003 and
the Energy Conservation Act, 2001 and to undertake such amendments to these Acts, as may
be necessary from time to time, in conformity with the Government’s policy objectives.
The Ministry of Power is mainly responsible for evolving general policy in the field of
energy. The main items of work dealt with by the Ministry of Power are as below:
1.1
General Policy in the Electric Power Sector and issues relating to energy policy.
(Details of short, medium and long-term policies in term policies in terms of formulation,
acceptance, implementation and review of such policies, cutting across sectors, fuels, regions
and cross country flows).
1.2
All matters relating to hydroelectric power (except small/mini/micro hydel projects of
and below 25 MW capacity) and thermal power and transmission system network.
1.3
Research, development and technical assistance relating to hydroelectric and thermal
power and transmission system network.
1.4. Administration of the Damodar Valley Corporation Act, 1948 (14 of 1948), the
Bhakra Beas Management Board as provided in the Punjab Reorganiasation Act, 1966 (31 of
1966).
1.5. All matters relating to Central Electricity Authority, Central Electricity Board and
Central Electricity Regulatory Commission.
1.6
Rural Electrification, power schemes in Union Territories and issues relating to power
supply in the States and Union Territories.
1.7
Matters relating to the following Undertakings/Organisations etc.:
(a) The Damodar Valley Corporation.
(b) The Bhakra Beas Management Board (except matters relating to irrigation).
(c) National Thermal Power Corporation Limited.
(d) National Hydro-electric Power Corporation Limited.
7
(e) Rural Electrification Corporation Limited.
(f) North Eastern Electric Power Corporation Limited.
(g) Power Grid Corporation of India Limited.
(h) Power Finance Corporation Limited.
(i) Tehri Hydro Development Corporation.
(j) Satluj Jal Vidyut Nigam Limited.
(k) Central Power Research Institute.
(l) National Power Training Institute.
(m) Bureau of Energy Efficiency.
1.8
Other Public Sector Enterprises concerned with the subject included under this
Ministry except such projects as are specifically allotted to any other Ministry or Department.
1.9
All matter concerning Energy Conservation and Energy Efficiency pertaining to the
Power Sector.
2.0
ORGANISATIONS UNDER MINISTRY OF POWER
The Central Electricity Authority is to exercise such functions and perform usch duties and
act in such a manner as the Central Government may prescribe under the Rules framed under
Section 176 of the Electricity Act, 2003 or by issue of written directions in matters of policy
involving public interest under Section 75 of the said Act. CEA is particularly charged with
the following functions under Section 73 of the said Act.
(i)
Advise the Central Government on the matters relating to the national electricity
policy, formulate short-term and perspective plans for development of the electricity system
and co-ordinate the activities of the planning agencies for the optimal utilization of resources
to subserve the interests of the national economy and to provide reliable and affordable
electricity for all consumers;
(ii) specify the technical standards for construction of electrical plants, electric lines and
connectivity to the grid;
(iii) specify the safety requirements for construction, operation and maintenance of electrical
plants and electric lines;
(iv) specify the Grid Standards for operation andmaintenance of transmission lines;
(v) specify the conditions for installation of meters for transmission and supply of electricity;
(vi) promote and assist in the timely completion of schemes and projects for improving and
augmenting the electricity system;
(vii) promote measures for advancing the skill of persons engaged in the electricity industry;
(viii) advise the Central Government on any matter on which its advice is sought or make
recommendation to that Government on any matter if, in the opinion of the Authority, the
recommendation would help in improving the generation, transmission, trading, distribution
and utilisation of electricity;
8
(ix) collect and record the data concerning the generation, transmission, trading, distribution
and utilisation of electricity and carry out studies relating to cost, efficiency, competitiveness
and such like matters;
(x) make public from time to time the information secured under this Act, and provide for the
publication of reports and investigations;
(xi) promote research in matters affecting the generation, transmission, distribution and
trading of electricity;
(xii) carry out, or cause to be carried out, any investigation for the purposes of generating or
transmitting or distributing electricity;
(xiii) advise any State Government, licensees or the generating companies on such matters
which shall enable them to operate and maintain the electricity system under their ownership
or control in an improved manner and where necessary, in co-ordination with any other
Government, licensee or the generating company owning or having the control of another
electricity system;
(xiv) advise the Appropriate Government and the Appropriate Commission on all technical
matters relating to generation, transmission and distribution of electricity; and
(xv) discharge such other functions as may be provided under this Act.
Apart from the above functions CEA also undertakes design and engineering of power
projects with a view to develop in house technical know-how and also to assist the State
Electricity Boards, Generating Companies & State authorities requiring such assistance .
Besides this, the monitoring of fly-ash generation by coal /lignite thermal power projects is
being carried out on all India basis.
Badarpur Management Contract Cell (BMCC), a subordinate office of this Ministry, is
responsible for administering the Badarpur Thermal Power Station (BTPS) Management
Contract between the Government of India and NTPC.
The construction and operation of generation and transmission projects in the Central Sector
are entrusted to Central Sector Power Corporations, viz. The National Thermal Power
Corporation (NTPC), the National Hydro Electric Power Corporation (NHPC), the North
Eastern Electric Power Corporation and the Power Grid Corporation of India Limited
(PGCIL). The Power Grid is responsible for all the existing and future transmission projects
in the Central Sector and also for the formation of the National Power Grid. Two Joint
Venture Power Corporations namely, Satluj Jal Vidyut Nigam (SJVN) and Tehri Hydro
Development Corporation (THDC) are responsible for the execution of the Nathpa Jhakri
Power Project in Himachal Pradesh and projects of the Tehri Hydro Power Complex in
Uttaranchal respectively. Two statutory bodies i.e., the Damodar Valley Corporation (DVC)
and the Bhakra Beas Management Board (BBMB) are also under the administrative control
of the Ministry of Power. Programmes of rural electrification are provided financial
assistance by the Rural Electrification Corporation (REC) under the Ministry of Power. The
Power Finance Corporation (PFC) provides term-finance to projects in the power sector.
9
Further, the autonomous bodies (societies) i.e. Central Power Research Institute (CPRI), the
National Power Training Institute (NPTI) and the Energy Management Centre (EMC) are
also under the administrative control of the Ministry of Power. A Power Trading Corporation
(PTC) has also been set up in April, 1999 to catalyse development of mega power projects
and to promote exchange of power with neighbouring countries.
3.0 ORGANISATIONAL SET-UP
Shri P.M. Sayeed is the Minister of Power. Shri. R.V. Shahi is the Secretary of the Ministry.
He is assisted by a Special Secretary, two Additional Secretaries and four Joint Secretaries,
including the Financial Adviser.
The Additional Secretary looks after the work relating to Operation Monitoring (OM),
Thermal, Energy Conservation, establishment matters of Central Electricity Authority,
including that of the Central Power Engineering (Group A) Services. The allocation of work
among the five Joint Secretaries in the Ministry of Power is as under:
(i) Hydel, Coordination, Press and Publicity.
(ii) Administration, Thermal and Distribution, including APDP and IT.
(iii) Reforms & Restructuring, Vigilance & Security, Power Finance Corporation (PFC) and
Rural Electrification Corporation (REC), Policy, Planning and External
Assistance,
Official Language.
(iv) Accounts & Finance, Resource Planning, Monitoring of Financial performance of SEBs,
and follow up action on the recommendation of Montek Singh Ahluwalia
Committee &
N.K. Singh Committee.
(v) Investment Promotion Cell, Transmission, Powergrid Corporation of India Ltd.
(PGCIL), Power Trading Corporation (PTC), Training & Research and Operation
Monitoring.
There is a Principal Accounts Office headed by the Controller of Accounts who in turn
reports to the Financial Adviser in the Ministry of Power. Matters relating to reservations for
SC/ST, Physically Handicapped and OBC are dealt by the respective Liaison Officers.
Matters relating to recreation activities are dealt by Power Sport Control Board. The total
staff strength of the Ministry is 313. There are 46 women employees in the Ministry of Power
(Sectt.)
4.0
INVESTMENT PROMOTION CELL
The Investment Promotion Cell (IPC) was set up in 1991 under the Ministry of Power as the
nodal agency to provide information and assistance to prospective entrepreneurs in the
electricity sector. Setting up of the IPC marked a fresh initiative to involve the private sector
in power generation in a much bigger way. IPC not only provides information on the policy
regarding private sector participation in the power sector, but also formulates or suggests
policy amendments to encourage private participation in power. It also acts as a single
window in providing guidance on the clearances to be obtained and the modalities for
obtaining these.
10
Statutory Bodies
Central Electricity Authority (CEA):
CEA is a statutory body constituted by the Central Government under the erstwhile
Electricity (Supply) Act, 1948 and continued under the Electricity Act, 2003 (which has since
repealed inter alia the E(S) Act, 1948). The Authority has the responsibility of formulating
the National Electricity Plan in accordance with the National Electricity Policy, once in five
years. CEA remains the main technical advisor of the Government, the Regulatory
Commissions. It is also required to specify inter-alia the technical standards and safety
requirements for construction, operation and maintenance of electrical standards and
electrical lines.
Appellate Tribunal For Electricity
Under the provisions of Section 110 of the Electricity Act, 2003, the Appellate
Tribunal for Electricity has been established at Delhi which will here appeals against the
orders of the Adjudicating Officer or the appropriate Regulatory Commission under the Act.
The Tribunal has become operational from 21st July, 2005. The Tribunal comprises of the
following Members:i)
ii)
iii)
iv)
Shri Justice Anil Dev Singh - Chairperson & Judicial Member
Shri Justice E.Padmanabhan – Judicial Member
Shri H.L.Bajaj - Technical Member
Shri A.A.Khan – Technical Member
Central Electricity Regulatory Commission (CERC):
CERC is a statutory body constituted under the provision of the erstwhile Electricity
Regulatory Commissions Act, 1998 and continued under Electricity Act, 2003 (which has
since repealed inter alia the ERC Act, 1998). The main functions of the CERC are to regulate
the tariff of generating companies owned or controlled by the Central Government, to
regulate the tariff of generating companies other than those owned or controlled by the
Central Government, if such generating companies enter into or otherwise have a composite
scheme for generation and sale of electricity in more than one State, to regulate the inter-State
transmission of energy including tariff of the transmission utilities, to grant licences for interState transmission and trading and to advise the Central Government in formulation of
National Electricity Policy and Tariff Policy.
State Electricity Regulatory Commission (SERC):
The SERC as a statutory body responsible for determination of tariff and grant of licence at
intra-State level was envisaged in the erstwhile Regulatory Commissions Act, 1998 and has
been continued in the Electricity Act, 2003 (which has since repealed inter alia the ERC Act,
1998). Main responsibilities of the SERC are to determine the tariff for generation, supply,
transmission and wheeling of electricity, whole sale, bulk or retail sale within the State; to
issue licences for intra-State transmission, distribution and trading; to promote co-generation
and generation of electricity from renewal sources of energy etc.
11
Central Transmission Utility (CTU):
CTU as a statutory body was conceived in section 27 A of the erstwhile Indian Electricity
Act, 1910 and has been retained in the Electricity Act, 2003 (which has since repealed interalia the Indian Electricity Act, 1910). The functions of the CTU are be to undertake
transmission of energy through inter-State transmission system and discharge all functions of
planning and coordination relating to inter-State transmission system with State Transmission
Utilities, Central Government, State Governments, generating companies etc. Power Grid
Corporation of India Limited has beennotified as Central Transmission Utility.
State Transmission Utility (STU):
STU as a statutory body was conceived in section 27 B of the erstwhile Indian Electricity
Act, 1910 and has been retained in the Electricity Act, 2003 (which has since repealed interalia the Indian Electricity Act, 1910). The functions of the State Transmission Utility are to
undertake transmission of energy through intra-state transmission system and discharge all
functions of planning and coordination relating to intra-State transmission system with
Central Transmission Utility, State Governments, generating companies etc.
National Load Despatch Centre (NLDC):
The Electricity Act, 2003 has provided for constitution of the National Load Despatch Centre
for optimum scheduling and despatch of electricity among the Regional Load Despatch
Centres. The constitution and functions of NLDC are being notified by the Central
Government.
Regional Load Despatch Centres (RLDC):
Section 25 of the Electricity Act, 2003 requires the Central Government to make regional
demarcation of the country for the efficient, economical and integrated transmission and
supply of electricity and in particular to facilitate voluntarily inter-connection and coordination of facilities for the inter-State, Regional and inter-regional generation and
transmission of electricity. To ensure integrated and power system in each such region, the
Regional Load Despatch Centre ((RLDC) has been envisaged as an apex body. The RLDC is
responsible inter-alia for despatch of electricity within the regions, monitoring grid operations
etc. The directions given by the RLDC for ensuring grid stability etc. are required to be
compiled with by the licensees, generating company, generating stations, sub-stations and
any other person connected with the operation of the power system. Erstwhile, five power
regions of the country have been constituted under the Act and are being entered to by 5
RLDCs.
State Load Despatch Centres (SLDC):
Corresponding to the RLDC which operates at the regional level, the SLDCs function at the
State level with the responsibility of ensuring integrated operations of the power system in
State.
12
Grievances Redressal Forum and Ombudsman:
The Electricity Act, 2003 requires every distribution licensee to establish a forum for
Redressal of Grievances of consumers. Ombudsman is an authority to be appointed or
designated by the State Regulatory Commission to hear and settle the non-redressal of
grievances at the level of Grievance Redressal Forum.
Coordination Forum:
The Electricity Act, 2003 envisages constitution of Coordination Forum both at the Central
and State level consisting of Chairperson and Members of the Regulatory Commissions and
other stakeholders like generating companies, licensees. The Coordination Forum is meant to
ensure smooth and coordinated development of the power system in the country or the State,
as the case may be.
Forum of Regulators:
Forum of regulators has been envisaged as statutory body under the Electricity Act, 2003.
The forum is to consist of the Chairperson of the Central Commission and Chairpersons of
State Commissions.
District Level Committees:
The Electricity Act, 2003 provides for constitution of District level Committees for
coordination and review of the extension of electrification in each district; for review of the
quality of power supply and consumer’s satisfaction; and for promotion of quality efficiency
and its conservation.
13
Initiatives taken by Ministry of Power
Government has taken several measures to increase private investment in the power
sector. The Electricity Act, 2003 contains several measures to attract private investment in
the power sector. Government has also initiated the process of reforms and re-structuring of
power sector which would improve the finances of the power utilities thereby attracting
private investments still further.
Government has also been assisting the private sector power projects in achieving
financial closure. Encouraged by the provisions of the Electricity Act, 2003, the financial
institutions have conveyed that there would be no dearth of funds for viable projects
implemented by promoters having credible background. An Inter-Institutional Group (IIG)
comprising senior representatives from the financial institutions as well as from the Ministry
of Power, has been instrumental in facilitating financial closure of 13 private power projects
having a total capacity of over 4477 MW.
To facilitate setting up of large sized thermal power plants in the country and in order
to derive the economies of scale, the Ministry of Power has further liberalized the mega
power policy and with effect from 1.3.2003, all inter-state projects with a capacity of
1000MW and above for thermal and 500MW and above for hydel projects are being treated
as mega power projects subject to fulfilment of the required conditions and would be
extended the concession of ‘Zero’ customs duty on import of capital goods. In order to
ensure that domestic bidders are not adversely affected, price preference of 15% is being
given for the domestic manufacturers in addition to deemed export benefits as per the EXIM
policy for mega projects under public and private sector. In addition, the income tax holiday
would be continued with the provision that the tax holiday period of 10 years can be claimed
by a promoter in any block of 10 years with the first 15 years. The State Governments are
requested to exempt supplies made to mega power plants from sales tax and local levies.
I.
Major Legislative initiatives
The Electricity Act, 2003
The Electricity Act, 2003 provides a liberal and progressive framework for power
development. The salient features of the Act are:
Central Government to prepare a National Electricity Policy and Tariff Policy in
consultation with State Governments.
A thrust to complete rural electrification and provide for management of rural
distribution by Panchayats, Cooperative Societies, non-Government organizations,
franchisees etc.
Generation delicensed and captive generation freely permitted.
Only those hydro
projects which involve capital expenditure exceeding a specified limit (presently Rs.
1000 crs. for hydro electric generating station prepared by a generating company
14
selected through a process of competitive bidding by the competent Government or
Governments) require concurrence from the Central Electricity Authority.
Transmission Utility at the Central as well as State level, to be a Government
company-with responsibility for planned and coordinated development of transmission
network. Provision for private transmission licensees.
Open access in transmission from the outset.
Distribution licensees would be free to undertake generation and generating companies
would be free to take up distribution licensees.
The State Electricity Regulatory Commission is a mandatory requirement.
No license for generation and distribution in the notified rural areas.
The SERCs to permit open access in distribution in phases with surcharge for current
level of cross subsidy to be gradually phased out along with cross subsidies.
Provision for payment of subsidy by State Governments through budget.
For rural and remote areas stand alone systems for generation and distribution
permitted.
Trading as a distinct activity recognized with the safeguard of the Regulatory
Commission being authorized to fix ceilings on trading margins, if necessary.
The State Governments have to reorganize the SEBs.
The Act does not prescribe any reform model, instead provides flexibility in time
frame for the purpose to the State Government to choose the model suiting to their
conditions.
Metering of all electricity supplied made mandatory.
An Appellate Tribunal to hear appeals against the decision of CERC and SERCs.
Provisions relating to theft of electricity made more stringent
Energy Conservation Act, 2001 and other Demand Side Management Measures
Enacted on October 1, 2001, the Energy Conservation Act lays down concrete measures to
ensure efficient use of energy and its conservation. The Act came into effect on March 1,
2002. A Bureau of Energy Efficiency (BEE) has been set up to make wide ranging
regulations to further the objectives of the Act. Also, Central and State Governments have
been empowered to facilitate and enforce efficient use of energy and its conservation. There
are Provisions of penalties for failures and on the system of adjudication.
Standards and Labeling (S&L) have been identified as a key area for energy efficiency
improvement in line with the experience of the developed countries.
15
Standards and Codes (S&C) would be taken up for commonly used equipment in
industries such as pumps, fans, blowers, compressors, boilers, etc. Efficiency increases
to the order of 10% are foreseen in most of the industrial equipment.
Market Development Mechanism including Project Development will be taken up in
the following areas:
Rural agricultural substation with private management.
Municipal / Metro water pumping efficiency improvement.
Programme for energy efficiency improvement in Government buildings,
commercial buildings, railways, defence establishments, etc.
Besides implementing the provision of the Act, a detailed Action Plan on Demand Side
Management is being prepared.
II. Policy measures / initiatives taken
Accelerated Power Development & Reform Programme
The Govt. of India approved Accelerated Power Development and Reform Programme
(APDRP) in March 2003 with a focus on distribution reforms with following objectives:
o
o
o
o
Reduce AT&C losses
Bring about commercial viability in the power sector
Reduce outages & interruptions
Increase consumer satisfaction
The programme has an outlay of Rs. 40,000 Crore as additional central plan assistance to
State Governments during Tenth five-year plan. The programme has two components
Investment:
GOI provides Additional Central Plan Assistance to the states for undertaking projects for
strengthening and up gradation of ST&D for reduction in technical & commercial losses &
feeder outages and better reliability & increased customer satisfaction
50% of the project cost is provided as Additional Central Plan Assistance in form of 50%
grant and 50% loan to the state utilities. Utilities have to arrange remaining 50% of the
project cost from Financial Institutions like PFC/REC or surplus internal resources. Special
categories states are entitled for 100% assistance in form of 90% grant and 10% loan (NE
states, J&K, H.P., Uttaranchal and Sikkim). The focus is on high-density networks i.e. urban
centers where investment could lead to substantial, quick & demonstrable results. The
investment component has an expected outlay of Rs. 20,000 Crore.
o Projects sanctioned: Rs. 17619.07 Cr.
o No. of projects:
499
o Funds released:
Rs. 4112.03 Cr.
16
o C/Part funds tied up: Rs. 6233.92 Cr.
o C/Part funds drawn: Rs. 2044.99 Cr.
o Funds Utilised:
Rs. 4762.18 Cr.
Incentive:
This component has been introduced to motivate the SEBs/Utilities to reduce their financial
losses. Funds are provided to SEBs/utilities for actual cash loss reduction by way of one for
two matching grants. FY 2000-01 has been fixed as base year. Expected outlay under the
Component is Rs. 20,000 Crore.
The total incentive amount released to the States upto November, 2004 is Rs.955.58 crores.
Improvements
•24 States have constituted SERCs and 18 SERCs have issued tariff orders.
•9 states unbundled/corporatised, Delhi & Orissa privatised their SEBs. 13 State utilities are
expected to corporatise shortly.
•100% feeder metering completed in 15 states and 2 states have achieved more than 90%
metering. (Overall 95% against 81.32% during 2001)
•100% consumer metering completed in 4 states and 9 states have achieved more than 90%
metering. (Overall 87% against 77.6% during 2001)
Consumer indexing started in A.P, Delhi, Gujarat, Karnataka, M.P., Maharashtra,
Punjab, Rajasthan & U.P.
Feeder managers identified by states for increased accountability, which is helping in
reduction of AT&C losses.
Computerised billing and consumer complaint centres started in selected towns of A.P.,
Delhi, Gujarat, Karnataka, Maharashtra, M.P. & U.P.
Andhra Pradesh, Delhi, West Bengal, Noida power Company have introduced High
Voltage Distribution System for arresting power pilferage.
•Financial Loss reduced by Andhra, Bihar, Goa, Gujarat, Kerala, M.P., Maharashtra,
Meghalaya, Punjab, Rajasthan, Tamilnadu, U.P. and West Bengal.
•Assam, Gujarat, Karnataka and Orissa have started handing over parts of distribution
networks to franchisees.
One Time Settlement of SEBs dues to central undertakings
Most of the SEBs were in poor financial health. As a result they were not been able to pay for
the power supplied to them. Their total outstanding dues to central power utilities had risen to
more than Rs. 41,000 Cr. After the Chief Ministers Conference in March'01 an Expert Group
17
was constituted. The recommendations of the Expert Group have been endorsed by the
Empowered Group of Chief Ministers and have been approved by the Union Council of
Ministers in March 2002. Thus the recommendations have been operationalised. As per the
recommendations, the outstanding dues of SEBs towards CPSUs have been securitised by
concerned States with the clear understanding that they will pay their current dues. This would
help the State Utilities to clean up their books and enable them to raise resources to fund their
development schemes. In addition the Central Utilities would also be able to meet the equity
requirements and leverage them for their expansion schemes. The scheme is making headway
as a substantial number of State Governments have consented to it in the context of meeting
their payment obligations to NTPC, the CPSU with the largest accumulated receivables from
the SEBs and successor utilites. The States have been given incentives to make it attractive for
them.
Ø Environment Management
Seized of the current and emerging pressure, both local and global, on the front of
environment management for the electricity sector, the Union Ministry of Power has taken
a number of new initiatives in addition to strengthening the existing ones. Special Purpose
Vehicle is being set up to effect compensatory afforestation to facilitate expeditious
clearance from Ministry of Environment and Forests (MOEF) for new power projects. An
MOU in this regard with MOEF is under finalization. An Action Plan on Clean
Development Mechanism has been approved and TERI has been asked to prepare a pipeline
of projects. A Fly Ash Utilization Action Plan is proposed to be formulated after
discussions with all stakeholders.
Facilitating Private Investment:
No ceiling on foreign equity participation in the power sector.
Alternative Payment Security Mechanism evolved to accelerate Private sector investment
in power sector.
Financing of IPPs linked to progress of reforms undertaken by State Govts.
Regarding private investment in power sector, there is an action plan to ensure financial
closures of IPPs and this is being monitored by the Crisis Resolution Group chaired by the
Union Minister for Power and attended by major financial institutions / Ministries and
promoters of IPPs. Foreign Direct Investment (FDI) in transmission is being encouraged
through two routes i.e. Joint Venture (JV) and Independent Private Transmission Co.
(IPTC) with specific schemes having been identified under each head.
Encouraging FDI in Transmission - Two routes identified for encouraging private sector
participation in transmission i.e. JV and IPTC routes. Specific transmission lines / schemes
identified for execution under both the routes.
International Conference cum Business meets
To deliberate on the critical issues and to enlist support and optimise investment in the
power sector from foreign and domestic investors, five international conferences-cumbusiness meets were held through CII, FICCI and CPSUs of the power sector. The areas
on which the conferences were held included:
18
i.
ii.
iii.
iv.
v.
Transmission, Energy Management & Convergence
Distribution
Non fossil Fuel Generation
Optimizing Existing capacity (R&M)
Fossil Fuel Generation
The conferences brought together several ideas concerning the entire range of power
development related issues. The business meets showcased the investment opportunity in
the power sector. The response was encouraging. As an example business opportunities
with ongoing bids of Rs.1800 crore were offered by NHPC and Tehri Hydro Development
Corporation(THDC). Also pre-bid conference for Main Plant Package of NTPC Sipat
Thermal Power Project offered business worth Rs. 6,000 crore.
Facilitating Captive Power Capacity
The Electricity Act, 2003 freely allows setting up of captive power plant including captive
plant by group of industries.
The Standing Committee on Training and Development has submitted its report on National
Training Action Plan for the Power Sector.
A Standing Committee on Research and Development constituted to draw up a perspective
Research and Development plan for the next fifteen years.
All households to be electrified in next five years ie. by 2009.
A Committee constituted to study to reduce the cost of delivered power has submitted its
report and is under implementation.
Developing broad political consensus on Reforms
The Meeting of the Chief Ministers on Power held in March 2001 helped in convergence of
views not only on broad parameters but also on certain methods to be adopted in different
areas of reforms alongwith indicative time frames. The follow up actions have been going
on and the reform agenda has been moving forward. Structural changes have been given
momentum and all 22 States have signed MOUs under Accelerated Power Development &
Reform Programme (APDRP).
Countrywide Awareness Campaign
A Mass campaign was launched to create general awareness amongst the public on the need
for reforms in power sector. More than 2000 Road shows were held in the months of
October-November 2001 in this regard. Students, opinion makers and common consumers
were informed and sensitized about the need for reforms, especially distribution reforms
and checking for power theft. A very encouraging response was received from the grassroot
level from all over the country.
III. Administrative steps undertaken
19
Projects formulation and implementation
A Committee set up for financing of power projects for capacity addition during Xth and
XIth Plans.
Monitoring mechanism strengthened with setting up of Power Projects Monitoring
Committee under Sp. Secy. (Power) for identification of projects, scheduling and
monitoring the implementation.
A Coordination Committee for Power set up for close interaction amongst the related
Ministries ; MOP, MNES, DAE, Deptt. of Coal
Plan for National Grid
For all the generating plants likely to be commissioned during the 10th Plan, transmission
projects have been identified and in some cases are already under execution. The objective
is to ensure that the inter-regional power transmission capability increases from the present
level of 4850 MW to 30,000 MW by year 2012 and realize the objectives of National Grid.
Towards the objective of formation of National Grid, a number of inter-regional schemes
have been planned for phased development. In order to further strengthen the
interconnection between regions, some more schemes have been approved which are under
different stages of implementation and are expected to be commissioned by 2003.
Looking into the future demand and availability of generation resources, a Perspective
Transmission Plan has been drawn up indicating the major inter-regional transmission
highways to be developed by 2011-12. This will ultimately lead to the formation of a strong
National Grid. These highways are proposed to be established in phases matching with the
requirement of inter-regional power transfer.
Action Plan for Xth plan period formulated for R&M of old thermal and hydro units.
Ranking Study for Prioritizing Hydro Power Development and other Allied Measures
A preliminary ranking study of 399 hydro schemes has been prepared. These schemes, with
an aggregate installed capacity of about 107,000 MW, have been prioritized in all the six
River Systems of the country. This will be the document for basin-wise development of
hydro capacity. The policy thrust is to improve the hydro-thermal mix so as to optimally
meet the peak and base load requirements. Some procedural improvements have been
brought about to curtail the gestation period of hydro projects and further improvements are
under consideration. The thrust is to improve the hydro-thermal mix so as to optimally meet
the peak and base load requirements. Some procedural improvements have been brought
about to curtail the gestation period of hydro projects and further improvements are under
consideration. The Preliminary Ranking Study has been released on 5th February 2002. The
identified potential hydroelectric sites in the various river basins have been prioritized in
the reports in the order of their attractiveness for implementation. The ranking study would
serve as guide to the potential developers to choose hydro schemes for investigations and
implementation.
Development of mini hydro and run of river projects Action initiated with MNES for
development of mini hydro and run of river projects.
Major Policy Initiatives to promote Private Participation
20
Competitive bidding for Awarding Projects: The initial batch of projects were awarded
generally on the basis of negotiations between the State Electricity Board (SEB) and a single
developer. With effect from 18.2.1995, competitive bidding for award of power projects to
private sector has been made mandatory. However, certain categories of projects mentioned
below, where the International Competitive Bidding (ICB) route may not be feasible, have been
exempted from this route. Detailed guidelines have also been issued to the State Governments
for adopting competitive bidding.
Setting up of Mega Power Projects: To facilitate setting up of large sized thermal power
plants in the country and in order to derive the economies of scale, the Ministry of Power
issued guidelines on 10th November, 1995, for setting up of mega power projects. Power
projects having a capacity of 1000 MW or above and supplying power to more than one State
were defined as Mega projects. After considering the experience of this policy, the policy
was revised in November 1998. Under the revised policy, specific Inter-state and Interregional mega power projects were identified for being developed both in the public as well
as private sector. A Power Trading Company(PTC) has been established to purchase power
from the private sector mega projects and sell it to the beneficiary States. The policy has
been further liberalized and with effect from 1.3.2003, all inter-state projects with a capacity
of 1000 MW and above for thermal and 500 MW and above for hydel proejcts are being
treated as mega power projects subject to fulfillment of required terms and conditions and
would be extended the concessions of ‘Zero’ customs duty on import of capital goods.
Policy on automatic approval for foreign direct investment: Projects for electric
generation, transmission and distribution permitted foreign equity participation up to 100%
on the automatic approval route.
Revised norms for environmental clearance: The following delegations have been made to
the state governments in the matter of environment clearance to power projects:(I)
(ii)
All co-generation plants and captive power plants upto 250 MW.
Coal based plants upto 500 MW using fluidized bed technology subject to sensitive
areas restrictions.
(iii) Power stations upto 250 MW on conventional technology.
(iv) Gas/Naphtha based station upto 500 MW.
Relaxation of 40 % cap for debt exposure by IFIs: The policy announced in 1991
envisaged that, an amount not exceeding 40% only of the total outlay for private sector units
may come from Indian public financial institutions (IPFIs). The Government ,subsequently,
has decided that while there will be no bar to the extent of domestic debt raised by a project
developer, subject to the need of maximising financing from external sources and prudential
norms exercised by IFIs, allowing a higher domestic debt component for projects which are
developed based on indigenously sourced plant and equipment, would be more desirable.
Inter Institutional Group: An Inter Institutional Group (IIG) and a ‘Green Channel’ in the
Ministry of Power was constituted in January, 2004 to facilitate financial closure of private
sector projects likely to come up in the Tenth Plan. The IIG and ‘Green Channel’ have
provided a forum for interaction amongst promoters of power projects, banks and financial
institutions and the Ministry of Power. The IIG has been instrumental in bringing about
speedy financial closure through better coordination with the relevant agencies.
21
22
Reforms and Restructuring of Power Sector in States – Milestones / Status
Total
Jharkhand
Uttranchal
Chhatisgarh
W. Bengal
Uttar
Pradesh
Tripura
Tamil Nadu
Sikkim
Rajasthan
Punjab
Orissa
Nagaland
Maharashtra
M.P.
Manipur
Mizoram
Meghalaya
Kerala
Karnataka
3.4.1
J&K
3.4
Himachal
Pradesh
Haryana
3.3
Goa
3.2
Gujarat
3.1
Delhi
3.0
Bihar
1.2 Operationalisa
tion of SERC.
2.0
Assam
SERC
1.1 SERC
constituted
1.3
Andhra
Pradesh
1.0
Arunachal
Pradesh
Milestones
Issuing
Tariff
orders
Signing of
MOU / MOA
with M/o
Power
Month/date
Unbundling/
Corporatisatio
n
Reform
ordinance /
Bill,
enactment
Unbundling /
corporatisatio
nImplementatio
n
Privatisation
of distribution
Distribution
Reforms
Creation of
distribution
zones/
companies.
03/01
06/01 03/01 02/01
01/02
02/00 05/01 01/01 03/01 04/01
03/01 09/01 03/03 01/01 10/04 02/01 03/01 04/0202/00 08/01
1999
2000 2003
23
05/00 03/01
1998
1999
2000
1996
2000
1999
08/99
08/99
07/00
01/00
04/96
18
18
27
9
2001
02/99
23
9
24
Electricity Act – 2003
PART I
PRELIMINARY
Short title, extent and commencement
1. This Act may be called the Electricity Act, 2003.
It extends to the whole of India except the State of Jammu and Kashmir.
It shall come into force on such date as the Central Government may, by notification, appoint:
Provided that different dates may be appointed for different provisions of this Act and any reference
in any such provision to the commencement of this Act shall be construed as a reference to the
coming into force of that provision.
2. In this Act, unless the context otherwise requires,
1. “Appellate Tribunal” means the Appellate Tribunal for Electricity established under section
110;
2. "appointed date" means such date as the Central Government may, by notification, appoint
3. "area of supply” means the area within which a distribution licensee is authorised by his
licence to supply electricity;
4. "Appropriate Commission” means the Central Regulatory Commission referred to in subsection (1) of section 76 or the State Regulatory Commission referred to in section 82 or the
Joint Commission referred to in section 83, as the case may be ;
5. "Appropriate Government" means, a. the Central Government, i.
in respect of a generating company wholly or partly owned by it;
ii.
in relation to any inter-State generation, transmission, trading or supply of
electricity and with respect to any mines, oil-fields, railways, national
highways, airports, telegraphs, broadcasting stations and any works of
defence, dockyard, nuclear power installations;
25
iii.
in respect of National Load Despatch Centre; and Regional Load Despatch
Centre;
iv.
in relation to any works or electric installation belonging to it or under its
control ;
b. in any other case, the State Government, having jurisdiction under this Act;
6. “Authority “ means the Central Electricity Authority referred to in sub-section(1) of section
70;
7. "Board" means, a State Electricity Board, constituted before the commencement of this Act,
under sub-section (I) of section 5 of the commencement of this Act, under sub-section (I) of
section 5 of the Electricity (Supply) Act, 1948;
8. “ Captive generating plant” means a power plant set up by any person to generate electricity
primarily for his own use and includes a power plant set up by any co-operative society or
association of persons for generating electricity primarily for use of members of such
cooperative society or association;
9. "Central Commission" means the Central Electricity Regulatory Commission referred to in
sub-section (1) of section 76;
10. "Central Transmission Utility" means any Government company which the Central
Government may notify under sub-section (1) of section 38;
11. " Chairperson" means the Chairperson of the Authority or Appropriate Commission or the
Appellate Tribunal as the case may be;
12. “ Cogeneration” means a process which simultaneously produces two or more forms of
useful energy (including electricity);
13. "company" means a company formed and registered under the Companies Act, 1956 and
includes any body corporate under a Central, State or Provincial Act;
14. "conservation" means any reduction in consumption of electricity as a result of increase in
the efficiency in supply and use of electricity;
15. "consumer" means any person who is supplied with electricity for his own use by a licensee
or the Government or by any other person engaged in the business of supplying electricity to
the public under this Act or any other law for the time being in force and includes any person
whose premises are for the time being connected for the purpose of receiving electricity with
the works of a licensee, the Government or such other person, as the case may be;
26
16. " Dedicated Transmission Lines " means any electric supply line for point to point
transmission which are required for the purpose of connecting electric lines or electric plants
of a captive generating plant referred to in section 9 or generating station referred to in
section 10 to any transmission lines or sub-stations or generating stations or the load centre,
as the case may be;
17. "distribution licensee" means a licensee authorised to operate and maintain a distribution
system for supplying electricity to the consumers in his area of supply;
18. "distributing main" means the portion of any main with which a service line is, or is intended
to be, immediately connected;
19. "distribution system" means the system of wires and associated facilities between the
delivery points on the transmission lines or the generating station connection and the point of
connection to the installation of the consumers;
20. "electric line" means any line which is used for carrying electricity for any purpose and
includes
a. any support for any such line, that is to say, any structure, tower, pole or other thing
in, on, by or from which any such line is, or may be, supported, carried or suspended;
and
b. (b) any apparatus connected to any such line for the purpose of carrying electricity;
21. "Electrical Inspector" means a person appointed as such by the Appropriate Government
under sub-section (1) of section 162 and also includes Chief Electrical Inspector;
22. "electrical plant" means any plant, equipment, apparatus or appliance or any part thereof
used for, or connected with, the generation, transmission, distribution or supply of electricity
but does not includea. an electric line; or
b. a meter used for ascertaining the quantity of electricity supplied to any premises; or
c. an electrical equipment, apparatus or appliance under the control of a consumer;
23. "electricity" means electrical energya. generated, transmitted, supplied or traded for any purpose; or
b. used for any purpose except the transmission of a message;
27
24. "Electricity Supply Code" means the Electricity Supply Code specified under section 50;
25. "electricity system” means a system under the control of a generating company or licensee,
as the case may be, having one or more a. generating stations; or
b. transmission lines; or
c. electric lines and sub-stations;
and when used in the context of a State or the Union, the entire electricity system within the
territories thereof;
26. "electricity trader" means a person who has been granted a licence to undertake trading in
electricity under section 12;
27. “ franchisee means a persons authorised by a distribution licensee to distribute electricity on
its behalf in a particular area within his area of supply;
28. "generating company" means any company or body corporate or association or body of
individuals, whether incorporated or not, or artificial juridical person, which owns or
operates
or
maintains
a
generating
station;
1 of 1956
29. "generate" means to produce electricity from a generating station for the purpose of giving
supply to any premises or enabling a supply to be so given;
30. "generating station" or “ station” means any station for generating electricity, including any
building and plant with step-up transformer, switch yard, switch-gear, cables or other
appurtenant equipment, if any used for that purpose and the site thereof, a site intended to be
used for a generating station, and any building used for housing the operating staff of a
generating station, and where electricity is operating staff of a generating station, and where
electricity is generated by water-power, includes penstocks, head and tail works, main and
regulating reservoirs, dams and other hydraulic works, but does not in any case include any
sub-station;
31. “ Government company” shall have the meaning assigned to it in section 617 of the
Companies Act, 1956;
32. "grid" means the high voltage backbone system of inter-connected transmission lines, substations and generating plants;
28
33. "Grid Code" means the Grid Code specified by the Central Commission under clause (h) of
sub-station (1) of section 79;
34. "Grid Standards" means the Grid Standards specified under clause (d) of section 73 by the
Authority;
35. "high voltage line” means an electric line or cable of a nominal voltage as may be specified
by the Authority from time to time;
36. “ inter-State transmission system” includes a. any system for the conveyance of electricity by means of main transmission line from
the territory of one State to another State;
b. the conveyance of electricity across the territory of an intervening State as well as
conveyance within the State which is incidental to such inter-State transmission of
electricity;
c. the transmission of electricity within the territory of a State on a system built, owned,
operated, maintained or controlled by Central Transmission Utility.
37. “ intra -State transmission system” means any system for transmission of electricity other
than an inter-State transmission system ;
38. “ licence” means a licence granted under section 14;
39. “ licensee “ means a person who has been granted a licence under section 14;
40. “ line” means any wire, cable, tube , pipe, insulator, conductor or other similar thing
(including its casing or coating) which is designed or adapted for use in carrying electricity
and includes any line which surrounds or supports, or is surrounded or supported by or is
installed in close proximity to, or is supported, carried or suspended in association with, any
such line;
41. “ local authority” means any Nagar Panchayat, Municipal Council, municipal corporation,
panchayat constituted at the village, intermediate and district levels, body or port
commissioners or other authority legally entitled to, or entrusted by the Union or any State
Government with, the control or management of any area or local fund;
42. "main” means any electric supply-``` line through which electricity is, or is intended to be,
supplied ;
29
43. "Member" means the Member of the Appropriate Commission or Authority or Joint
Commission, or the Appellate Tribunal, as the case may be, and includes the Chairperson of
such Commission or may be, and includes the Chairperson of such Commission or Authority
or appellate tribunal;
44. "National Electricity Plan" means the National Electricity Plan notified under sub-section (4)
of section 3;
45. “ National Load Despatch Centre” means the Centre established under sub-section (1) of
section 26;
46. “ notification” means notification published in the Official Gazette and the expression “
notify” shall be construed accordingly;
47. “ open access” means the non-discriminatory provision for the use of transmission lines or
distribution system or associated facilities with such lines or system by any licensee or
consumer or a person engaged in generation in accordance with the regulations specified by
the Appropriate Commission;
48. “ overhead line” means an electric line which is placed above the ground and in the open air
but does not include live rails of a traction system;
49. “ person” shall include any company or body corporate or association or body of individuals,
whether incorporated or not, or artificial juridical person;
50. "power system" means all aspects of generation, transmission, distribution and supply of
electricity and includes one or more of the following, namely:a. generating stations;
b. transmission or main transmission lines;
c. sub-stations;
d. tie-lines;
e. load despatch activities;
f. mains or distribution mains;
g. electric supply-lines;
h. overhead lines;
30
i. service lines;
j. works;
51. “ premises” includes any land, building or structure;
52. “ prescribed” means prescribed by rules made by the Appropriate Government under this
Act;
53. "public lamp" means an electric lamp used for the lighting of any street;
54. "real time operation" means action to be taken at a given time at which information about the
electricity system is made available to the concerned Load Despatch Centre;
55. “ Regional Power Committee” means a committee established by resolution by the Central
Government for a specified region for facilitating the integrated operation of the power
systems in that region;
56. "Regional Load Despatch Centre" means the centre established under sub-section (1) of
section 27;
57. "regulations" means regulations made under this Act;
9 of 1910
54 of 1948
14 of 1998
58. “ repealed laws” means the Indian Electricity Act, 1910, the Electricity (Supply) Act, 1948
and the Electricity Regulatory Commissions Act, 1998 repealed by section 185;
59. "rules " means rules made under this Act;
60. “ schedule” means the schedule to this Act;
61. "service-line" means any electric supply line through which electricity is, or is intended to
be,supplied a. to a single consumer either from a distributing main or immediately from the
Distribution Licensee's premises; or
b. from a distributing main to a group of consumers on the same premises or on
contiguous premises supplied from the same point of the distributing main;
62. "specified" means specified by regulations made by the Appropriate Commission or the
Authority, as the case may be, under this Act;
31
63. “ stand alone system” means the electricity system set up to generate power and distribute
electricity in a specified area without connection to the grid;
64. "State Commission" means the State Electricity Regulatory Commission constituted under
sub-section (1) of section 82 and includes a Joint Commission constituted under sub-section
(1) of section 83;
65. "State Grid Code" means the State Grid Code referred under clause (h) of sub-section (1) of
section 86;
66. "State Load Despatch Centre" means the centre established under subsection (1) of section
31;
67. "State Transmission Utility" means the Board or the Government company specified as such
by the State Government under sub-section (1) of section 39;
68. "street" includes any way, road, lane, square, court, alley, passage or open space, whether a
thoroughfare or not, over which the public have a right of way, and also the roadway and
footway over any public bridge or causeway;
69. "sub-station" means a station for transforming or converting electricity for the transmission
or distribution thereof and includes transformers, converters, switchgears, capacitors,
synchronous condensers, structures, cable and other appurtenant equipment and any
buildings used for that purpose and the site thereof;
70. "supply", in relation to electricity, means the sale of electricity to a licensee or consumer;
71. "trading" means purchase of electricity for resale thereof and the expression "trade" shall be
construed accordingly;
72. “ transmission lines" means all high pressure cables and overhead lines (not being an
essential part of the distribution system of a licensee) transmitting electricity from a
generating station to another generating station or a sub-station, together with any step-up
and step-down transformers, switch-gear and other works necessary to and used for the
control of such cables or overhead lines, and such buildings or part thereof as may be
required to accommodate such transformers, switchgear and other works;
73. "transmission licensee” means a licensee authorised to establish or operate transmission
lines;
74. "transmit" means conveyance of electricity by means of transmission lines and the
expression "transmission" shall be construed accordingly;
32
75. "utility" means the electric lines or electrical plant, and includes all lands, buildings, works
and materials attached thereto belonging to any person acting as a generating company or
licensee under the provisions of this Act;
76. "wheeling" means the operation whereby the distribution system and associated facilities of a
transmission licensee or distribution licensee, as the case may be, are used by another person
for the conveyance of electricity on payment of charges to be determined under section 62;
77. "works" includes electric line, and any building, plant, machinery, apparatus and any other
thing of whatever description required to transmit, distribute or supply electricity to the
public and to carry into effect the objects of a licence or sanction granted under this Act or
any other law for the time being in force.
PART II
NATIONAL ELECTRICITY POLICY AND PLAN
National Electricity Policy and Plan
3.
1. The Central Government shall, from time to time, prepare the national electricity policy and
tariff policy, in consultation with the State Governments and the Authority for development
of the power system based on optimal utilisation of resources such as coal, natural gas,
nuclear substances or materials, hydro and renewable sources of energy.
2. The Central Government shall publish National Electricity Policy and tariff policy from time
to time.
3. The Central Government may, from time to time, in consultation with the State Governments
and the Authority, review or revise, the National Electricity Policy and tariff policy referred
to in sub-section (1) .
4. The Authority shall prepare a National Electricity Plan in accordance with the National
Electricity Policy and notify such plan once in five years: . Provided that the Authority in
preparing the National Electricity Plan shall publish the draft National Electricity Plan and
invite suggestions and objections thereon from licensees, generating companies and the
public
within
such
time
as
may
be
prescribed:
Provided further that the Authority shall a. notify the plan after obtaining the approval of the Central Government;
b. revise the plan incorporating therein the directions, if any, given by the Central
Government while granting approval under clause (a).
5. The Authority may review or revise the National Electricity Plan in accordance with the
National Electricity Policy.
33
National policy on stand alone systems for rural areas and nonconventional energy systems.
4. The Central Government shall, after consultation with the State Governments, prepare and notify
a national policy, permitting stand alone systems (including those based on renewable sources of
energy and non-conventional sources of energy ) for rural areas.
National policy on electrification and local distribution in rural areas.
5. The Central Government shall also formulate a national policy, in consultation with the State
Governments and the State Commissions, for rural electrification and for bulk purchase of power
and management of local distribution in rural areas through Panchayat Institutions, users’
associations, co-operative socities, non- Governmental organisations or franchisees.
Obligations to supply electricity to rural areas.
6. The Appropriate Government shall endeavour to supply electricity to all areas including villages
and hamlets.
PART III
GENERATION OF ELECTRICITY
Generating Company and requirement for setting up of generating station
7. Any generating company may establish, operate and maintain a generating station without
obtaining a licence under this Act if it complies with the technical standards relating to connectivity
with the grid referred to in clause (b) of section 73.
Hydro-electric generation
8.
1. Notwithstanding anything contained in section 7, any generating company intending to setup a hydro-generating station shall prepare and submit to the Authority for its concurrence, a
scheme estimated to involve a capital expenditure exceeding such sum, as may be fixed by
the Central Government, from time to time, by notification.
2. The Authority shall, before concurring in any scheme submitted to it under sub-section (1)
have particular regard to, whether or not in its opinion,a. the proposed river-works will prejudice the prospects for the best ultimate
development of the river or its tributaries for power generation, consistent with the
requirements of drinking water, irrigation, navigation, flood-control, or other public
purposes, and for this purpose the Authority shall satisfy itself, after consultation with
the State Government, the Central Government, or such other agencies as it may
34
deem appropriate, that an adequate study has been made of the optimum location of
dams and other river-works;
b. the proposed scheme meets, the norms regarding dam design and safety.
3. Where a multi-purpose scheme for the development of any river in any region is in
operation, the State Government and the generating company shall co-ordinate their
activities with the activities of the person responsible for such scheme in so far as they are
inter-related.
Captive Generation
9.
1. Notwithstanding anything contained in this Act, a person may construct, maintain or operate
a captive generating plant and dedicated transmission lines: Provided that the supply of
electricity from the captive generating plant through the grid shall be regulated in the same
manner as the generating station of a generating company.
2. Every person, who has constructed a captive generating plant and maintains and operates
such plant, shall have the right to open access for the purposes of carrying electricity from
his captive generating plant to the destination of his use: Provided that such open access shall
be subject to availability of adequate transmission facility and such availability of
transmission facility shall be determined by the Central Transmission Utility or the State
Transmission Utility, as the case may be: Provided further that any dispute regarding the
availability of transmission facility shall be adjudicated upon by the Appropriate
Commission.
Duties of Generating Companies
10.
1. Subject to the provisions of this Act, the duties of a generating company shall be to establish,
operate and maintain generating stations, tie-lines, sub-stations and dedicated transmission
lines connected therewith in accordance with the provisions of this Act or the rules or
regulations made thereunder.
2. A generating company may supply electricity to any licensee in accordance with this Act and
the rules and regulations made thereunder and may, subject to the regulations made under
sub-section (2) of section 42, supply electricity to any consumer.
3. Every generating company shall
a. submit technical details regarding its generating stations to the Appropriate
Commission and the Authority;
35
b. co-ordinate with the Central Transmission Utility or the State Transmission Utility, as
the case may be, for transmission of the electricity generated by it.
Direction to generating companies
11.
1. The Appropriate Government may specify that a generating company shall, in extraordinary
circumstances operate and maintain any generating station in accordance with the directions
of that Government. Explanation. - For the purposes of this section, the expression “
extraordinary circumstances” means circumstances arising out of threat to security of the
State, public order or a natural calamity or such other circumstances arising in the public
interest.
2. The Appropriate Commission may offset the adverse financial impact of the directions
referred to in sub-section (1) on any generating company in such manner as it considers
appropriate.
36
PART IV
LICENSING
Authorised persons to transmit,supply,etc.,electricity
12.No person shall
a. transmit electricity; or
b. distribute electricity; or
c. undertake trading in electricity,
unless he is authorised to do so by a licence issued under section 14, or is exempt under section 13.
Power to exempt
13.
The Appropriate Commission may, on the recommendations, of the Appropriate Government, in
accordance with the national policy formulated under section 5 and in public interest, direct, by
notification that subject to such conditions and restrictions, if any, and for such period or periods, as
may be specified in the notification, the provisions of section 12 shall not apply to any local
authority, Panchayat Institution, users’ association, co-operative societies, nongovernmental
organizations, or franchisees:
Grant of Licence
14.
The Appropriate Commission may, on application made to it under section 15, grant any person
licence to any person a. to transmit electricity as a transmission licensee; or
b. to distribute electricity as a distribution licensee; or
c. to undertake trading in electricity as an electricity trader,
in any area which may be specified in the licence: Provided that any person engaged in the business
of transmission or supply of electricity under the provisions of the repealed laws or any Act
specified in the Schedule on or before the appointed date shall be deemed to be a licensee under this
Act for such period as may be stipulated in the licence, clearance or approval granted to him under
the repealed laws or such Act specified in the Schedule, and the provisions of the repealed laws or
such Act specified in the Schedule in respect of such licence shall apply for a period of one year
from the date of commencement of this Act or such earlier period as may be specified, at the request
of the licensee, by the Appropriate Commission and thereafter the provisions of this Act shall apply
to such business: Provided further that the Central Transmission Utility or the State Transmission
37
Utility shall be deemed to be a transmission licensee under this Act: Provided also that in case an
Appropriate Government transmits electricity or distributes electricity or undertakes trading in
electricity, whether before or after the commencement of this Act, such Government shall be
deemed to be a licensee under this Act, but shall not be required to obtain a licence under this Act:
14 of 1948
Provided also that the Damodar Valley Corporation, established under sub-section (1) of section 3 of
the Damodar Valley Corporation Act, 1948, shall be deemed to be a licensee under this Act but shall
not be required to obtain a licence under this Act and the provisions of the Damodar Valley
Corporation Act, 1948, in so far as they are not inconsistent with the provisions of this Act, shall
continue to apply to that Corporation: Provided also that the Government company or the company
referred to in sub-section (2) of section 131 of this Act and the company or companies created in
pursuance of the Acts specified in the Schedule, shall be deemed to be a licensee under this Act:
Provided also that the Appropriate Commission may grant a licence to two or more persons for
distribution of electricity through their own distribution system within the same area, subject to the
conditions that the applicant for grant of licence within the same area, subject to the conditions that
the applicant for grant of licence within the same area shall, without prejudice to the other conditions
or requirements under this Act, comply with the additional requirements (including the capital
adequacy, credit-worthiness, or code of conduct) as may be prescribed by the Central Government,
and no such applicant who complies with all the requirements for grant of licence, shall be refused
grant of licence on the ground that there already exists a licensee in the same area for the same
purpose: Provided also that in a case where a distribution licensee proposes to undertake distribution
of electricity for a specified area within his area of supply through another person, that person shall
not be required to obtain any separate licence from the concerned State Commission and such
distribution licensee shall be responsible for distribution of electricity in his area of supply: Provided
also that where a person intends to generate and distribute electricity in a rural area to be notified by
the State Government, such person shall not require any licence for such generation and distribution
of electricity, but he shall comply with the measures which may be specified by the Authority under
section 53: Provided also that a distribution licensee shall not require a licence to undertake trading
in electricity.
Procedure for Grant of Licence
15.
1. Every application under section 14 shall be made in such form and in such manner as may be
specified by the Appropriate Commission and shall be accompanied by such fee as may be
prescribed.
2. Any person who has made an application for grant of licence shall, within seven days after
making such application, publish a notice of his application with such particulars and in such
manner as may be specified and a licence shall not be granted i.
until the objections, if any, received by the Appropriate Commission in response to
publication of the application have been considered by it: Provided that no objection
shall be so considered unless it is received before the expiration of thirty days from
the date of the publication of such notice as aforesaid;
38
ii.
until, in the case of an application for a licence for an area including the whole or any
part of any cantonment, aerodrome, fortress, arsenal, dockyard or camp or of any
building or place in the occupation of the Government for defence purposes, the
Appropriate Commission has ascertained that there is no objection to the grant of the
licence on the part of the Central Government.
3. A person intending to act as a transmission licensee shall, immediately on making the
application, forward a copy of such application to the Central Transmission Utility or the
State Transmission Utility, as the case may be.
4. The Central Transmission Utility or the State Transmission Utility, as the case may be, shall,
within thirty days after the receipt of the copy of the application referred to in sub-section
(3), send its recommendations, if any, to the Appropriate Commission: Provided that such
recommendations shall not be binding on the Commission.
5. Before granting a licence under section 14, the Appropriate Commission shall a. publish a notice in two such daily newspapers, as that Commission may consider
necessary, stating the name of the person to whom it proposes to issue the licence;
b. consider all suggestions or objections and the recommendations, if any, of the Central
Transmission Utility or State Transmission Utility, as the case may be.
6. Where a person makes an application under sub-section (1) of section 14 to act as a licensee,
the Appropriate Commission shall, as far as practicable, within ninety days after receipt of
such application, .
issue a licence subject to the provisions of this Act and the rules and regulations made
thereunder; or
a. reject the application for reasons to be recorded in writing if such application does
not conform to the provisions of this Act or the rules and regulations made thereunder
or the provisions of any other law for the time being in force: Provided that no
application shall be rejected unless the applicant has been given an opportunity of
being heard.
7. The Appropriate Commission shall, immediately after issue of licence, forward a copy of the
licence to the Appropriate Government , Authority, local authority, and to such other person
as the Appropriate Commission considers necessary.
8. A licence shall continue to be in force for a period of twentyfive years unless such licence is
revoked.
Conditions of licence.
16.
The Appropriate Commission may specify any general or specific conditions which shall apply
either to a licensee or class of licensees and such conditions shall be deemed to be conditions of such
licence: Provided that the Appropriate Commission shall, within one year from the appointed date,
specify any general or specific conditions of licence applicable to the licensees referred to in the
first, second, third, fourth and fifth provisos to section 14 after the expiry of one year from the
commencement of this Act.
39
Licensee not to do certain things.
17.
1. No licensee shall, without prior approval of the Appropriate Commission, a. undertake any transaction to acquire by purchase or takeover or otherwise, the utility
of any other licensee; or
b. merge his utility with the utility of any other licensee: Provided that nothing
contained in this sub-section shall apply if the utility of the licensee is situate in a
State other than the State in which the utility referred to in clause (a) or clause (b) is
situate.
2. Every licensee shall, before obtaining the approval under subsection (1), give not less than
one month’s notice to every other licensee who transmits or distributes, electricity in the area
of such licensee who applies for such approval.
3. No licensee shall at any time assign his licence or transfer his utility, or any part thereof, by
sale, lease , exchange or otherwise without the prior approval of the Appropriate
Commission.
4. Any
agreement
relating
to
any
transaction
specified
in
subsection
(1) or sub-section (3), unless made with, the prior approval of the
Appropriate Commission, shall be void.
Amendment of licence
18.
1. Where in its opinion the public interest so permits, the Appropriate Commission, may, on the
application of the licensee or otherwise, make such alterations and amendments in the terms
and conditions of a licence as it thinks fit: Revocation of licence Provided that no such
alterations or amendments shall be made except with the consent of the licensee unless such
consent has, in the opinion of the Appropriate Commission, been unreasonably withheld.
2. Before any alterations or amendments in the licence are made under this section, the
following provisions shall have effect, namely: a. where the licensee has made an application under sub-section (1) proposing any
alteration or modifications in his licence, the licensee shall publish a notice of such
application with such particulars and in such manner as may be specified;
b. in the case of an application proposing alterations or modifications in the area of
supply comprising the whole or any part of any cantonment, aerodrome, fortress,
arsenal, dockyard or camp or of any building or place in the occupation of the
Government for defence purposes, the Appropriate Commission shall not make any
alterations or modifications except with the consent of the Central Government;
c. where any alterations or modifications in a licence are proposed to be made otherwise
than on the application of the licensee, the Appropriate Commission shall publish the
proposed alterations or modifications with such particulars and in such manner as
may be specified;
40
d. the Appropriate Commission shall not make any alterations or modification unless all
suggestions or objections received within thirty days from the date of the first
publication of the notice have been considered.
Revocation of licence
19.
1. If the Appropriate Commission, after making an enquiry, is satisfied that public interest so
requires, it may revoke a licence in any of the following cases, namely: a. where the licensee, in the opinion of the Appropriate Commission, makes wilful and
prolonged default in doing anything required of him by or under this Act or the rules
or regulations made thereunder;
b. where the licensee breaks any of the terms or conditions of his licence the breach of
which is expressly declared by such licence to render it liable to revocation;
c. where the licensee fails, within the period fixed in this behalf by his licence, or any
longer period which the Appropriate Commission may have granted therefor –
i.
to show, to the satisfaction of the Appropriate Commission, that he is in a
position fully and efficiently to discharge the duties and obligations imposed
on him by his licence; or 15 Sale of utilities of licensees. and obligations
imposed on him by his licence; or
ii.
to make the deposit or furnish the security, or pay the fees or other charges
required by his licence;
d. where in the opinion of the Appropriate Commission the financial position of the
licensee is such that he is unable fully and efficiently to discharge the duties and
obligations imposed on him by his licence.
2. Where in its opinion the public interest so requires, the Appropriate Commission may, on
application, or with the consent of the licensee, revoke his licence as to the whole or any part
of his area of distribution or transmission or trading upon such terms and conditions as it
thinks fit.
3. No licence shall be revoked under sub-section (1) unless the Appropriate Commission has
given to the licensee not less than three months’notice, in writing, stating the grounds on
which it is proposed to revoke the licence, and has considered any cause shown by the
licensee within the period of that notice, against the proposed revocation.
4. The Appropriate Commission may, instead of revoking a licence under sub-section (1),
permit it to remain in force subject to such further terms and conditions as it thinks fit to
impose, and any further terms or conditions so imposed shall be binding upon and be
observed by the licensee and shall be of like force and effect as if they were contained in the
licence.
5. Where the Commission revokes a licence under this section, it shall serve a notice of
revocation upon the licensee and fix a date on which the revocation shall take effect.
41
6. Where an Appropriate Commission has given notice for revocation of licence under subsection (5), without prejudice to any penalty which may be imposed or prosecution
proceeding which may be initiated under this Act, the licensee may, after prior approval of
that Commission, sell his utility to any person who is found eligible by that Commission for
grant of licence.
Sale of utilities of licensees.
20.
1. Where the Appropriate Commission revokes under section 19 the licence of any licensee ,
the following provisions shall apply, namely:a. the Appropriate Commission shall invite applications for acquiring the utility of the
licensee whose licence has been revoked and determine which of such applications
should be accepted, primarily on the basis of the highest and best price offered for the
utility;
b. the Appropriate Commission may, by notice in writing, require the licensee to sell his
utility and thereupon the licensee shall sell his utility to the person (hereafter in this
section referred to as the “ purchaser” ) whose application has been accepted by that
Commission;
c. all the rights, duties, obligations and liabilities of the licensee, on and from the date of
revocation of licence or on and from the date, if earlier, on which the utility of the
licensee is sold to a purchaser, shall absolutely cease except for any liabilities which
have accrued prior to that date;
d. the Appropriate Commission may make such interim arrangements in regard to the
operation of the utility as may be considered appropriate including the appointment
ofconsidered appropriate including the appointment of Administrators;
e. The Administrator appointed under clause (d) shall exercise such powers and
discharge such functions as the Appropriate Commission may direct.
2. Where a utility is sold under sub-section (1), the purchaser shall pay to the licensee the
purchase price of the utility in such manner as may be agreed upon.
3. Where the Appropriate Commission issues any notice under subsection (1) requiring the
licensee to sell the utility, it may, by such notice, require the licensee to deliver the utility,
and thereupon the licensee shall deliver on a date specified in the notice, the utility to the
designated purchaser on payment of the purchase price thereof.
4. Where the licensee has delivered the utility referred to in subsection( 3) to the purchaser but
its sale has not been completed by the date fixed in the notice issued under that sub-section,
the Appropriate Commission may, if it deems fit, permit the intending purchaser to operate
and maintain the utility system pending the completion of the sale.
Vesting of utility in purchaser
21.
42
Where a utility is sold under section 20 or section 24, then, upon completion of the sale or on the
date on which the utility is delivered to the intending purchaser, as the case may be, whichever is
earliera. the utility shall vest in the purchaser or the intending purchaser, as the case may be, free from
any debt, mortgage or similar obligation of the licensee or attaching to the utility: Provided
that any such debt, mortgage or similar obligation shall attach to the purchase money in
substitution for the utility; and
b. the rights, powers, authorities, duties and obligations of the licensee under his licence shall
stand transferred to the purchaser and such purchaser shall be deemed to be the licensee.
Provisions where no purchase takes place
22.
1. (1) If the utility is not sold in the manner provided under section 20 or section 24, the
Appropriate Commission may, to protect the interest of consumers or in public interest, issue
such directions or formulate such scheme as it may deem necessary for operation of the
utility.
2. Where no directions are issued or scheme is formulated by the Appropriate Commission
under sub-section (1), the licensee referred to in section 20 or section 24 may dispose of the
utility in such manner as it may deem fit: Provided that, if the licensee does not dispose of
the utility, within a period of six months from the date of revocation under section 20 or
section 24, the Appropriate Commission may cause the works of the licensee in, under, over,
along, or across any street or public land to be removed and every such street or public land
to be reinstated, and recover the cost of such removal and reinstatement from the licensee.
Directions to licensees.
23.
If the Appropriate Commission is of the opinion that it is necessary or expedient so to do for
maintaining the efficient supply, securing the equitable distribution of electricity and promoting
competition, it may, by order, provide for regulating supply, distribution, consumption or use
thereof.
Suspension of distribution licence and sale of utility.
24.
1. If at any time the Appropriate Commission is of the opinion that a distribution licensee –
a. has persistently failed to maintain uninterrupted supply of electricity conforming to
standards regarding quality of electricity to the consumers; or
b. is unable to discharge the functions or perform the duties imposed on it by or under
the provisions of this Act; or
c. has persistently defaulted in complying with any direction given by the Appropriate
Commission under this Act; or
d. has broken the terms and conditions of licence,
43
and circumstances exist which render it necessary for it in public interest so to do, the
Appropriate Commission may, for reasons to be recorded in writing, suspend, for a period
not exceeding one year, the licence of the distribution licensee and appoint an Administrator
to discharge the functions of the distribution licensee in accordance with the terms and
conditions of licence:
Provided that before suspending a licence under this section, the Appropriate Commission
shall give a reasonable opportunity to the distribution licensee to make representations
against the proposed suspension of license and shall consider the representations, if any, of
the distrbution licensee.
2. Upon suspension of license under sub-section (1) the utilities of the distribution licensee
shall vest in the Administrator for a period not exceeding one year or up to the date on which
such utility is sold in accordance with the provisions contained in section 20, whichever is
later.
3. The Appropriate Commission shall, within one year of appointment of the Administrator
under sub-section (1) either revoke the licence in accordance with the provisions contained in
section 19 or revoke suspension of the licence and restore the utility to the distribution
licensee whose licence had been suspended, as the case may be.
4. In case where the Appropriate Commission revokes the licence under sub-section (3), the
utility of the distribution licensee shall be sold within a period of one year from the date of
revocation of the licence in accordance with the provisions of section 20 and the price after
deducting the administrative and other expenses on sale of utilities be remitted to the
distribution licensee.
44
PART V
TRANSMISSION OF ELECTRICITY
Inter-State transmission
Inter-State, regional and Inter-Regional transmission.
25.
For the purposes of this Part, the Central Government may, make regionwise demarcation of the
country, and, from time to time, make such modifications therein as it may consider necessary for
the efficient, economical and integrated transmission and supply of electricity, and in particular to
facilitate voluntary interconnections and co-ordination of facilities for the inter-State, regional and
interregional generation and transmission of electricity.
National Load Despatch Centre.
26.
1. The Central Government may establish a centre at the national level, to be known as the
National Load Despatch Centre for optimum scheduling and despatch of electricity among
the Regional Load Despatch Centres.
2. The constitution and functions of the National Load Despatch Centre shall be such as may be
prescribed by the Central Government: Provided that the National Load Despatch Centre
shall not engage in the business of trading in electricity.
3. The National Load Despatch Centre shall be operated by a Government company or any
authority or corporation established or constituted by or under any Central Act, as may be
notified by the Central Government.
Constitution of Regional Load Despatch Centre.
27.
1. The Central Government shall establish a centre for each region to be known as the Regional
Load Despatch Centre having territorial jurisdiction as determined by the Central
45
Government in accordance with section 25 for the purposes of exercising the powers and
discharging the power and discharging the functions under this Part.
2. The Regional Load Despatch Centre shall be operated by a Government Company or any
authority or corporation established or constituted by or under any Central Act, as may be
notified by the Central Government:
Provided that until a Government company or authority or corporation referred to in this sub-section
is notified by the Central Government, the Central Transmission Utility shall operate the Regional
Load Despatch Centre:
Provided further that no Regional Load Despatch Centre shall engage in the business of generation
of electricity or trading in electricity.
Functions of Regional Load Despatch Centre.
28.
1. The Regional Load Despatch Centre shall be the apex body to ensure integrated operation of
the power system in the concerned region.
2. The Regional Load Despatch Centre shall comply with such principles, guidelines and
methodologies in respect of the wheeling and optimum scheduling and despatch of electricity
as the Central Commission may specify in the Grid Code.
3. The Regional Load Despatch Centre shall a. be responsible for optimum scheduling and despatch of electricity within the region,
in accordance with the contracts entered into with the licensees or the generating
companies operating in the region;
b. monitor grid operations;
c. keep accounts of the quantity of electricity transmitted through the regional grid;
d. exercise supervision and control over the inter-State transmission system; and
e. be responsible for carrying out real time operations for grid control and despatch of
electricity within the region through secure and economic operation of the regional
grid in accordance with the Grid Standards and the Grid Code.
4. The Regional Load Despatch Centre may levy and collect such fee and charges from the
generating companies or licensees engaged in inter-State transmission of electricity as may
be specified by the Central Commission.
46
Compliance of directions.
29.
1. The Regional Load Despatch Centre may give such directions and exercise such supervision
and control as may be required for ensuring stability of grid operations and for achieving the
maximum economy and efficiency in the operation of the power system in the region under
its control.
2. Every licensee, generating company, generating station, substation and any other person
connected with the operation of the power system shall comply with the direction issued by
the Regional Load Despatch Centres under sub-section (1).
3. All directions issued by the Regional Load Despatch Centres to any transmission licensee of
State transmission lines or any other licensee of the State or generating company (other than
those connected to inter State transmission system) or sub-station in the State shall be issued
through the State Load Despatch Centre and the State Load Despatch Centres shall ensure
that such directions are duly complied with the licensee or generating company or substation.
4. The Regional Power Committee in the region may, from time to time, agree on matters
concerning the stability and smooth operation of the integrated grid and economy and
efficiency in the operation of the power system in that region.
5. If any dispute arises with reference to the quality of electricity or safe, secure and integrated
operation of the regional grid or in relation to any direction given under sub-section (1), it
shall be referred to the Central Commission for decision : Provided that pending the decision
of the Central Commission, the directions of the Regional Load Despatch Centre shall be
complied with by the State Load Despatch Centre or the licensee or the generating company,
as the case may be.
6. If any licensee, generating company or any other person fails to comply with the directions
issued under sub-section (2) or sub-section (3), he shall be liable to penalty not exceeding
rupees fifteen lacs.
Intra-State transmission
Transmission within a State
30.
The State Commission shall facilitate and promote transmission, wheeling and inter-connection
arrangements within its territorial jurisdiction for the transmission and supply of electricity by
economical and efficient utilisation of the electricity.
47
Constitution of State Load Despatch Centres
31.
1. The State Government shall establish a Centre to be known as the State Load Despatch
Centre for the purposes of exercising the powers and discharging the functions under this
Part.
2. The State Load Despatch Centre shall be operated by a Government company or any
authority or corporation established or constituted Government company or any authority or
corporation established or constituted by or under any State Act, as may be notified by the
State Government.
Provided that until a Government company or any authority or corporation is notified by the State
Government, the State Transmission Utility shall operate the State Load Despatch Centre:
Provided further that no State Load Despatch Centre shall engage in the business of trading in
electricity.
Functions of State Load Despatch Centres
32.
1. The State Load Despatch Centre shall be the apex body to ensure integrated operation of the
power system in a State.
2. The State Load Despatch Centre shall a. be responsible for optimum scheduling and despatch of electricity within a State, in
accordance with the contracts entered into with the licensees or the generating
companies operating in that State;
b. monitor grid operations;
c. keep accounts of the quantity of electricity transmitted through the State grid;
d. exercise supervision and control over the intra-state transmission system; and
e. be responsible for carrying out real time operations for grid control and despatch of
electricity within the State through secure and economic operation of the State grid in
accordance with the Grid Standards and the State Grid Code.
3. The State Load Despatch Centre may levy and collect such fee and charges from the
generating companies and licensees engaged in intra-State transmission of electricity as may
be specified by the State Commission.
Compliance of directions
33.
48
1. The State Load Despatch Centre in a State may give such directions and exercise such
supervision and control as may be required for ensuring the integrated grid operations and
for achieving the maximum economy and efficiency in the operation of power system in that
State.
2. Every licensee, generating company, generating station, substation and any other person
connected with the operation of the power system shall comply with the direction issued by
the State Load Depatch Centre under subsection (1).
3. The State Load Despatch Centre shall comply with the directions of the Regional Load
Despatch Centre.
4. If any dispute arises with reference to the quality of electricity or safe, secure and integrated
operation of the State grid or in relation to any direction given under sub-section (1) , it shall
be referred to the State Commission for decision: Provided that pending the decision of the
State Commission, the direction of the State Load Despatch Centre shall be complied with by
the licensee or generating company.
5. If any licensee, generating company or any other person fails to comply with the directions
issued under sub-section(1), he shall be liable to penalty not exceeding rupees five lacs.
Other provisions relating to transmission
Grid Standards
34
Every transmission licensee shall comply with such technical standards, of operation and
maintenance of transmission lines, in accordance with the Grid Standards, as may be specified by
the Authority.
Intervening transmission facilities.
35.
The Appropriate Commission may, on an application by any licensee, by order require any other
licensee owning or operating intervening transmission facilities to provide the use of such facilities
to the extent of surplus capacity available with such licensee.
Provided that any dispute regarding the extent of surplus capacity available with the licensee, shall
be adjudicated upon by the Appropriate Commission.
Charges for intervening transmission facilities.
36.
49
1. Every licensee shall, on an order made under section 35, provided his intervening
transmission facilities at rates, charges and terms and conditions as may be mutually agreed
upon : Provided that the Appropriate Commission may specify rates, charges and terms and
conditions if these cannot be mutually agreed upon by the licensees.
2. The rates, charges and terms and conditions referred to in subsection (1) shall be fair and
reasonable, and may be allocated in proportion to the use of such facilities.
Explanation. - For the purposes of section 35 and 36, the expression “ intervening transmission
facilities” means the electric lines owned or operated by a licensee where such electric lines can be
utilised for transmitting electricity for and on behalf of another licensee at his request and on
payment of a tariff or charge.
Direction by appropriate Government.
37.
The Appropriate Government may issue directions to the Regional Load Despatch Centres or State
Load Despatch Centres, as the case may be, to take such measures as may be necessary for
maintaining smooth and stable transmission and supply of electricity to any region or State.
Central Transmission Utility and functions.
38.
1. The Central Government may notify any Government company as the Central Transmission
Utility: Provided that the Central Transmission Utility shall not engage in the business of
generation of electricity or trading in electricity
1 of 1956
Provided further that, the Central Government may transfer, and vest any property, interest in
property, rights and liabilities connected with, and personnel involved in transmission of
electricity of such Central Transmission Utility, to a company or companies to be
incorporated under the Companies Act, 1956 to function as a transmission licensee, through
a transfer scheme to be effected in the manner specified under Part XIII and such company
or companies shall be deemed to be transmission licensees under this Act.
2. The functions of the Central Transmission Utility shall be a. to undertake transmission of electricity through inter-State transmission system;
b. to discharge all functions of planning and co-ordination relating to inter-state
transmission system with i.
State Transmission Utilities;
50
ii.
Central Government;
iii.
State Governments;
iv.
generating companies;
v.
Regional Power Committees;
vi.
) Authority;
vii.
licensees;
viii.
any other person notified by the Central Government in this behalf;
c. to ensure development of an efficient, co-ordinated and economical system of interState transmission lines for smooth flow of electricity from generating stations to the
load centres;
d. to provide non-discriminatory open access to its transmission system for use byi.
any licensee or generating company on payment of the transmission charges;
or
ii.
any consumer as and when such open access is provided by the State
Commission under sub-section (2) of section 42, on payment of the
transmission charges and a surcharge thereon, as may be specified by the
Central Commission:
Provided that such surcharge shall be utilised for the purpose of meeting the
requirement of current level cross-subsidy:
Provided further that such surcharge and cross subsidies shall be
progressively reduced and eliminated in the manner as may be specified by
the Central Commission:
Provided also that such surcharge may be levied till such time the cross
subsidies are not eliminated:
Provided also that the manner of payment and utilisation of the surcharge
shall be specified by the Central Commission:
Provided also that such surcharge shall not be leviable in case open access is
provided to a person who has established a captive generating plant for
carrying the electricity to the destination of his own use.
51
State Transmission Utility and functions
39.
1. The State Government may notify the Board or a Government company as the State
Transmission Utility:
Provided that the State Transmission Utility shall not engage in the business of trading in
electricity:
Provided further that the State Government may transfer, and vest any property, interest in
property, rights and liabilities connected with, and personnel involved in transmission of
electricity, of such State Transmission Utility, to a company or companies to be incorporated
under the Companies Act, 1956 to function as transmission licensee through a transfer
scheme to be effected in the function as transmission licensee through a transfer scheme to
be effected in the manner specified under Part XIII and such company or companies shall be
deemed to be transmission licensees under this Act.
2. The functions of the State Transmission Utility shall be a. to undertake transmission of electricity through intra-State transmission system;
b. to discharge all functions of planning and co-ordination relating to intra-state
transmission system with i.
Central Transmission Utility;
ii.
State Governments;
iii.
generating companies;
iv.
Regional Power Committees;
v.
Authority;
vi.
licensees;
vii.
any other person notified by the State Government in this behalf;
c. to ensure development of an efficient, co-ordinated and economical system of intraState transmission lines for smooth flow of electricity from a generating station to the
load centres;
d. to provid non-discriminatory open access to its transmission system for use byi.
any licensee or generating company on payment of the transmission charges ;
or
52
ii.
any consumer as and when such open access is provided by the State
Commission under sub-section (2) of section 42, on payment of the
transmission charges and a surcharge thereon, as may be specified by the
State Commission:
Provided that such surcharge shall be utilised for the purpose of meeting the
requirement of current level cross-subsidy:
Provided further that such surcharge and cross subsidies shall be
progressively reduced and eliminated in the manner as may be specified by
the State Commission:
Provided also that such surcharge may be levied till such time the cross
subsidies are not eliminated:
Provided also that the manner of payment and utilisation of the surcharge
shall be specified by the State Commission.
Provided also that such surcharge shall not be leviable in case open access is
provided to a person who has established a captive generating plant for
carrying the electricity to the destination of his own use.
Duties of Transmission licensees
40.
It shall be the duty of a transmission licensee a. to build, maintain and operate an efficient, co-ordinated and economical inter-State
transmission system or intra-State transmission economical inter-State transmission system
or intra-State transmission system, as the case may be;
b. to comply with the directions of the Regional Load Despatch Centre and the State Load
Despatch Centre as the may be;.
c. to provide non-discriminatory open access to its transmission system for use byi.
any licensee or generating company on payment of the transmission charges; or
ii.
any consumer as and when such open access is provided by the State Commission
under sub-section (2) of section 42, on payment of the transmission charges and a
surcharge thereon, as may be specified by the State Commission:
Provided that such surcharge shall be utilised for the purpose of meeting the
requirement of current level cross-subsidy:
53
Provided further that such surcharge and cross subsidies shall be progressively
reduced and eliminated in the manner as may be specified by the Appropriate
Commission:
Provided also that such surcharge may be levied till such time the cross subsidies are
not eliminated: Provided also that the manner of payment and utilisation of the
surcharge shall be specified by the Appropriate Commission:
Provided also that such surcharge shall not be leviable in case open access is
provided to a person who has established a captive generating plant for carrying the
electricity to the destination of his own use.
Other business of Transmission Licensee
41.
A transmission licensee may, with prior intimation to the Appropriate Commission , engage in any
business for optimum utilisation of its assets:
Provided that a proportion of the revenues derived from such business shall, as may be specified by
the Appropriate Commission, be utilised for reducing its charges for transmission and wheeling:
Provided further that the transmission licensee shall maintain separate accounts for each such
business undertaking to ensure that transmission business neither subsidies in any way such business
undertaking nor encumbers its transmission assets in any way to support such business:
Provided also that no transmission licensee shall enter into any contract or otherwise engage in the
business to in trading electricity :
54
PART V1
DISTRIBUTION OF ELECTRICITY
Provisions with respect to distribution licensees
Duties of distribution Licensee and open access
42.
1. It shall be the duty of a distribution licensee to develop and maintain an efficient, coordinated and economical distribution system in his area of supply and to supply electricity
in accordance with the provisions contained in this Act.
2. The State Commission shall introduce open access in such phases and subject to such
conditions, (including the cross subsidies, and other operational constraints) as may be
specified within one year of the appointed date by it and in specifying the extent of open
access in successive phases and in determining the charges for wheeling, it shall have due
regard to all relevant factors including such cross subsidies, and other operational
constraints: Provided that such open access may be allowed before the cross subsidies are
eliminated on payment of a surcharge in addition to the charges for wheeling as may be
determined by the State Commission : Provided further that such surcharge shall be utilised
to meet the requirements of current level of cross subsidy within the area of supply of the
distribution licensee : Provided also that such surcharge and cross subsidies shall be
progressively reduced and eliminated in the manner as may be specified by the State
Commission: Provided also that such surcharge shall not be leviable in case open access is
provided to a person who has established a captive generating plant for carrying the
electricity to the destination of his own use.
3. Where any person, whose premises are situated within the area of supply of a distribution
licensee, (not being a local authority engaged in the business of distribution of electricity
before the appointed date) requires a supply of electricity from a generating company or any
licensee other than such distribution licensee, such person may, by notice, require the
distribution licensee for wheeling such electricity in accordance with regulations made by the
State Commission and the duties of the distribution licensee with respect to such supply shall
be of a common carrier providing non-discriminatory open access .
4. Where the State Commission permits a consumer or class of consumers to receive supply of
electricity from a person other than the distribution licensee of his area of supply, such
consumer shall be liable to pay an additional surcharge on the charges of wheeling, as may
be specified by the State Commission, to meet the fixed cost of such distribution licensee
arising out of his obligation to supply.
55
5. Every distribution licensee shall, within six months from the appointed date or date of grant
of licence, whichever is earlier, establish a forum for redressal of grievances of the
consumers in accordance with the guidelines as may be specified by the State Commission.
6. Any consumer, who is aggrieved by non-redressal of his grievances under sub-section (5),
may make a representation for the redressal of his grievance to an authority to be known as
Ombudsman to be appointed or designated by the State Commission.
7. The Ombudsman shall settle the grievance of the consumer within such time and in such
manner as may be specified by the State Commission.
8. The provisions of sub-sections (5),(6) and (7) shall be without prejudice to right which the
consumer may have apart from the rights conferred upon him by those sub-sections.
Duty to supply on request
43.
1. Every distribution licensee, shall, on an application by the owner or occupier of any
premises, give supply of electricity to such premises, within one month after receipt of the
application
requiring
such
supply
:
Provided that where such supply requires extension of distribution mains, or commissioning
of new sub-stations, the distribution licensee shall supply the electricity to such premises
immediately after such extension or commissioning or within such period as may be
specified b commissioning or within such period as may be specified by the Appropriate
Commission.
Provided further that in case of a village or hamlet or area wherein no provision for supply of
electricity exists, the Appropriate Commission may extend the said period as it may consider
necessary for electrification of such village or hamlet or area.
2. It shall be the duty of every distribution licensee to provide, if required, electric plant or
electric line for giving electric supply to the premises specified in sub-section (1) :
Provided that no person shall be entitled to demand, or to continue to receive, from a licensee
a supply of electricity for any premises having a separate supply unless he has agreed with
the licensee to pay to him such price as determined by the Appropriate Commission .
3. If a distribution licensee fails to supply the electricity within the period specified in subsection (1), he shall be liable to a penalty which may extend to one thousand rupees for each
day of default.
56
Exceptions from duty to supply electricity.
44.
Nothing contained in section 43 shall be taken as requiring a distribution licensee to give supply of
electricity to any premises if he is prevented from doing so by cyclone, floods, storms or other
occurrences beyond his control.
Power to recover charges
45.
1. Subject to the provisions of this section, the prices to be charged by a distribution licensee
for the supply of electricity by him in pursuance of section 43 shall be in accordance with
such tariffs fixed from time to time and conditions of his licence.
2. The charges for electricity supplied by a distribution licensee shall be a. fixed in accordance with the methods and the principles as may be specified by the
concerned State Commission ;
b. published in such manner so as to give adequate publicity for such charges and
prices.
3. The charges for electricity supplied by a distribution licensee may include a. a fixed charge in addition to the charge for the actual electricity supplied;
b. a rent or other charges in respect of any electric meter or electrical plant provided by
the distribution licensee.
4. Subject to the provisions of section 62, in fixing charges under this section a distribution
licensee shall not show undue preference to any person or class of persons or discrimination
against any person or class of persons.
5. The charges fixed by the distribution licensee shall be in accordance with the provisions of
this Act and the regulations made in this behalf by the concerned State Commission.
Power to recover expenditure
46.
The State Commission may, by regulations, authorise a distribution licensee to charge from a person
requiring a supply of electricity in pursuance of section 43 any expenses reasonably incurred in
providing any electric line or electrical plant used for the purpose of giving that supply.
Power to require security.
47.
57
1. Subject to the provisions of this section, a distribution licensee may require any person, who
requires a supply of electricity in pursuance of section 43, to give him reasonable security, as
determined by regulations, for the payment to him of all monies which may become due to
him a. in respect of the electricity supplied to such persons; or
b. where any electric line or electrical plant or electric meter is to be provided for
supplying electricity to person, in respect of the provision of such line or plant or
meter, and if that person fails to give such security, the distribution licensee may, if
he thinks fit, refuse to give the supply or to provide the line or plant or meter for the
period during which the failure continues.
2. Where any person has not given such security as is mentioned in subsection (1) or the
security given by any person has become invalid or insufficient, the distribution licensee
may, by notice, require that person, within thirty days after the service of the notice, to give
him reasonable security for the payment of all monies which may become due to him in
respect of the supply of electricity or provision of such line or plant or meter.
3. If the person referred to in sub-section(2) fails to give such security, the distribution licensee
may, if he thinks fit, discontinue the supply of electricity for the period during which the
failure continues.
4. The distribution licensee shall pay interest equivalent to the bank rate or more, as may be
specified by the concerned State Commission, on the security referred to in sub-section (1)
and refund such security on the request of the person who gave such security.
5. A distribution licensee shall not be entitled to require security in pursuance of clause (a) of
sub-section (1) if the person requiring the supply is prepared to take the supply through a
pre-payment meter.
Additional terms of supply.
48.
A distribution licensee may require any person who requires a supply of electricity in pursuance of
section 43 to accept a. any restrictions which may be imposed for the purpose of enabling the distribution licensee
to comply with regulations made under section 53;
b. any terms restricting any liability of the distribution licensee for economic loss resulting
from negligence of the person to whom the electricity is supplied.
58
Agreements with respect to supply or purchase of electricity.
49.
Where the Appropriate Commission has allowed open access to certain consumers under section 42,
such consumers notwithstanding the provisions contained in clause (d) of sub-section (1) of section
62, may enter into an agreement with any person for supply or purchase of electricity on such terms
and conditions (including tariff) as may be agreed upon by them.
The Electricity Supply Code.
50.
The State Commission shall specify an Electricity Supply Code to provide for recovery of electricity
charges, intervals for billing of electricity charges disconnection of supply of electricity for nonpayment thereof; restoration of supply of electricity; tampering, distress or damage to electrical
plant, electric lines or meter, entry of distribution licensee or any person acting on his behalf for
disconnecting supply and removing the meter; entry for replacing, altering or maintaining electric
lines or electrical plant or meter.
Other businesses of distribution licensees.
51.
1. A distribution licensee may, with prior intimation to the Appropriate Commission, engage in
any
other
business
for
optimum
utilisation
of
its
assets:
Provided that a proportion of the revenues derived from such business shall, as may be
specified by the concerned State Commission, be utilised for reducing its charges for
wheeling
:
Provided further that the distribution licensee shall maintain separate accounts for each such
business undertaking to ensure that distribution business neither subsidies in any way such
business undertaking nor encumbers its distribution assets in any way to support such
business. Provided also that nothing contained in this section shall apply to a local authority
engaged, before the commencement of this Act, in the business of distribution of electricity
Provisions with respect to electricity traders
Provisions with respect to electricity trader.
52.
1. Without prejudice to the provisions contained in clause (c) of section 12, the Appropriate
Commission may, specify the technical requirement, capital adequacy requirement and credit
worthiness for being an electricity trader.
59
2. Every electricity trader shall discharge such duties, in relation to supply and trading in
electricity, as may be specified by the Appropriate Commission.
Provisions with respect to supply generally
Provisions relating to safety and electricity supply
53.
1. The Authority may in consultation with the State Government, specify suitable measures for
–
a. protecting the public (including the persons engaged in the generation, transmission or
distribution or trading) from dangers arising from the generation, transmission or distribution
or trading of electricity, or use of electricity supplied or installation, maintenance or use of
any electric line or electrical plant;
b. eliminating or reducing the risks of personal injury to any person, or damage to property of
any person or interference with use of such property ;
c. prohibiting the supply or transmission of electricity except by means of a system which
conforms to the specification as may be specified;
d. giving notice in the specified form to the Appropriate Commission and the Electrical
Inspector, of accidents and failures of supplies or transmissions of electricity;
e. keeping by a generating company or licensee the maps, plans and sections relating to supply
or transmission of electricity;
f. inspection of maps, plans and sections by any person authorised by it or by Electrical
Inspector or by any person on payment of specified fee;
g. specifying action to be taken in relation to any electric line or electrical plant, or any
electrical appliance under the control of a consumer for the purpose of eliminating or
reducing a risk of personal injury or damage to property or interference with its use;
Control of transmission and use of electricity
54.
1. Save as otherwise exempted under this Act, no person other than Central Transmission
Utility or a State Transmission Utility, or a licensee shall transmit or use electricity at a rate
exceeding two hundred and fifty watts and one hundred volts –
a. in any street, or
60
b. in any place,i.
in which one hundred or more persons are ordinarily likely to be assembled;
or
ii.
which is a factory within the meaning of the Factories Act, 1948 or a mine
within the meaning of the Mines Act, 1952; or declares 63 of 1948.35 of
1952.
to which the State Government, by general or special order, the provisions of
this sub-section to apply,
iii.
without giving, before the commencement of transmission or use of electricity, not
less than seven days’ notice in writing of his intention to the Electrical Inspector and
to the District Magistrate, or the Commissioner of Police, as the case may be,
containing particulars of the electrical installation and plant, if any, the nature and the
purpose of supply and complying with such of the provisions of Part XI of this Act,
as may be applicable:
24 of 1989
Provided that nothing in this section shall apply to electricity used for the public
carriage of passengers, animals or goods, on, or for the lighting or ventilation of the
rolling stock of any railway or tramway subject to the provisions of the Railways Act,
1989.
2. Where any difference or dispute arises as to whether a place is or is not one in which one
hundred or more persons are ordinarily likely to be assembled, the matter shall be referred to
the State Government, and the decision of the State Government thereon shall be final.
3. The provisions of this section shall be binding on the Government.
55.
1. No licensee shall supply electricity, after the expiry of two years from the appointed
date,Use, etc., of meters except through installation of a correct meter in accordance with
regulations to be made in this behalf by the Authority: Provided that the licensee may require
the consumer to give him security for the price of a meter and enter into an agreement for the
hire thereof, unless the consumer elects to purchase a meter: Provided further that the State
Commission may, by notification extend the said period of two years for a class or classes of
persons or for such area as may be specified in that notification.
2. For proper accounting and audit in the generation, transmission and distribution or trading of
electricity, the Authority may direct the installation of meters by a generating company or
61
licensee at such stages of generation, transmission or distribution or trading of electricity and
at such locations of generation, transmission or distribution or trading , as it may deem
necessary.
3. If a person makes default in complying with the provisions contained in this section or
regulations made under sub-section (1), the Appropriate Commission may make such order
as it thinks fit for requiring the default to be made good by the generating company or
licensee or by any officers of a company or other association or any other person who is
responsible for its default.
Disconnection of supply in default of payment.
56.
1. Where any person neglects to pay any charge for electricity or any sum other than a charge
for electricity due from him to a licensee or the generating company in respect of supply,
transmission or distribution or wheeling of electricity to him, the licensee or the generating
company may, after giving not less than fifteen clear days notice in writing, to such person
and without prejudice to his rights to recover such charge or other sum by suit, cut off the
supply of electricity and for that purpose cut or disconnect any electric supply line or other
works being the property of such licensee or the generating company through which
electricity may have been supplied, transmitted, distributed or wheeled and may discontinue
the supply until such charge or other sum, together with any expenses incurred by him in
cutting off and reconnecting the supply, are paid, but no longer: Provided that the supply of
electricity shall not be cut off if such person deposits , under protest, a. an amount equal to the sum claimed from him, or
b. the electricity charges due from him for each month calculated on the basis of
average charge for electricity paid by him during the preceding six months,
whichever is less, pending disposal of any dispute between him and the licensee.
2. Notwithstanding anything contained in any other law for the time being in force, no sum due
from any consumer, under this section shall be recoverable after the period of two years from
the date when such sum became first due unless such sum has been shown continuously as
recoverable as arrear of charges for electricity supplied and the licensee shall not cut off the
supply of the electricity:
Consumer protection: Standards of performance
Standard of performance of licensee.
57.
62
1. The Appropriate Commission may, after consultation with the licensees and persons likely to
be affected, specify standards of performance of a licensee or a class of licensees.
2. If a licensee fails to meet the standards specified under subsection (1), without prejudice to
any penalty which may be imposed or prosecution be initiated, he shall be liable to pay such
compensation to the person affected as may be determined by the Appropriate Commission:
Provided that before determination of compensation, the concerned licensee shall be given a
reasonable opportunity of being heard.
3. The compensation determined under sub-section (2) shall be paid by the concerned licensee
within ninety days of such determination.
Different Standards of performance by licensee.
58.
The Appropriate Commission may specify different standards under subsection (1) of section 57 for
a class or classes of licensee.
Information with respect to levels of performance.
59.
1. Every licensee shall, within the period specified by the Appropriate Commission, furnish to
the Commission the following information, namely:a. the level of performance achieved under sub-section (1) of the section 57;
b. the number of cases in which compensation was made under subsection (2) of section
57 and the aggregate amount of the compensation.
2. The Appropriate Commission shall at least once in every year arrange for the publication, in
such form and manner as it considers appropriate, of such of the information furnished to it
under sub-section (1).
Market destination
60.
The Appropriate Commission may such issue directions as it considers appropriate to a licensee or a
generating company if such licensee or generating company enters into any agreement or abuses its
dominant position or enters into a combination which is likely to cause or causes an adverse effect
on competition in electricity industry.
63
PART V11
TARIFF
Tariff Regulations.
61.
The Appropriate Commission shall, subject to the provisions of this Act, specify the terms and
conditions for the determination of tariff, and in doing so, shall be guided by the following, namely:a. the principles and methodologies specified by the Central Commission for determination of
the tariff applicable to generating companies and transmission licensees;
b. the generation, transmission, distribution and supply of electricity are conducted on
commercial principles;
c. the factors which would encourage competition, efficiency, economical use of the resources,
good performance and optimum investments;
d. safeguarding of consumers' interest and at the same time, recovery of the cost of electricity in
a reasonable manner;
e. the principles rewarding efficiency in performance;
f. multi year tariff principles;
g. that the tariff progressively reflects the cost of supply of electricity and also, reduces and
eliminates cross-subsidies within the period to be specified by the Appropriate Commission;
h. the promotion of co-generation and generation of electricity from renewable sources of
energy;
i. the National Electricity Policy and tariff policy:
54 of 1948 14 of 1998
Provided that the terms and conditions for determination of tariff under the Electricity (Supply) Act,
1948, the Electricity Regulatory Commission Act, 1998 and the enactments specified in the
Schedule as they stood immediately before the appointed date, shall continue to apply for a period of
one year or until the terms and conditions for tariff are specified under this section, whichever is
earlier.
Determination of Tariff.
62.
1. The Appropriate Commission shall determine the tariff in accordance with provisions of this
Act for –
64
a. supply of electricity by a generating company to a distribution licensee: Provided that
the Appropriate Commission may, in case of shortage of supply of electricity, fix the
minimum and maximum ceiling of tariff for sale or purchase of electricity in
pursuance of an agreement, entered into between a generating company and a
licensee or between licensees, for a period not exceeding one year to ensure
reasonable prices of electricity;
b. transmission of electricity ;
c. wheeling of electricity;
d. retail sale of electricity. Provided that in case of distribution of electricity in the same
area by two or more distribution licensees, the Appropriate Commission may, for
promoting competition among distribution licensees, fix only maximum ceiling of
tariff for retail sale of electricity.
2. The Appropriate Commission may require a licensee or a generating company to furnish
separate details, as may be specified in respect of generation, transmission and distribution
for determination of tariff.
3. The Appropriate Commission shall not, while determining the tariff under this Act, show
undue preference to any consumer of electricity but may differentiate according to the
consumer's load factor, power factor, voltage, total consumption of electricity during any
specified period or the time at which the supply is required or the geographical position of
any area, the nature of supply and the purpose for which the supply is required.
4. No tariff or part of any tariff may ordinarily be amended more frequently than once in any
financial year, except in respect of any changes expressly permitted under the terms of any
fuel surcharge formula as may be specified.
5. The Commission may require a licensee or a generating company to comply with such
procedures as may be specified for calculating the expected revenues from the tariff and
charges which he or it is permitted to recover.
6. If any licensee or a generating company recovers a price or charge exceeding the tariff
determined under this section, the excess amount shall be recoverable by the person who has
paid such price or charge along with interest equivalent to the bank rate without prejudice to
any other liability incurred by the licensee.
65
Determination of tariff by bidding process.
63.
Notwithstanding anything contained in section 62, the Appropriate Commission shall adopt the tariff
if such tariff has been determined through transparent process of bidding in accordance with the
guidelines issued by the Central Government.
Procedure for tariff order.
64.
1. An application for determination of tariff under section 62 shall be made by a generating
company or licensee in such manner and accompanied by such fee, as may be determined by
regulations.
2. Every applicant shall publish the application, in such abridged form and manner, as may be
specified by the Appropriate Commission.
3. The Appropriate Commission shall, within one hundred and twenty days from receipt of an
application under sub-section (1) and after considering all suggestions and objections
received from the public,a. issue a tariff order accepting the application with such modifications or such
conditions as may be specified in that order;
b. reject the application for reasons to be recorded in writing if such application is not in
accordance with the provisions of this Act and the rules and regulations made
thereunder or the provisions of any other law for the time being in force: Provided
that an applicant shall be given a reasonable opportunity of being heard before
rejecting his application.
4. The Appropriate Commission shall, within seven days of making the order, send a copy of
the order to the Appropriate Government, the Authority, and the concerned licensees and to
the person concerned.
5. Notwithstanding anything contained in Part X, the tariff for any inter-State supply,
transmission or wheeling of electricity, as the case may be, involving the territories of two
States may, upon application made to it by the parties intending to undertake such supply,
transmission or wheeling, be determined under this section by the State Commission having
jurisdiction in respect of the licensee who intends to distribute electricity and make payment
therefor:
6. A tariff order shall, unless amended or revoked, shall continue to be in force for such period
as may be specified in the tariff order.
66
Provision of subsidy by State Government.
65.
If the State Government requires the grant of any subsidy to any consumer or class of consumers in
the tariff determined by the State Commission under section 62, the State Government shall,
notwithstanding any direction which may be given under section 108, pay, within in advance in the
manner as may be specified , by the State Commission the amount to compensate the person
affected by the grant of subsidy in the manner the State Commission may direct, as a condition for
the licence or any other person concerned to implement the subsidy provided for by the State
Government:
Provided that no such direction of the State Government shall be operative if the payment is not
made in accordance with the provisions contained in this section and the tariff fixed by State
Commission shall be applicable from the date of issue of orders by the Commission in this regard. .
Development of market.
66.
The Appropriate Commission shall endeavour to promote the development of a market (including
trading) in power in such manner as may be specified and shall be guided by the National Electricity
Policy referred to in section 3 in this regard..
67
PART V111
WORKS
Works of licensees
Provision as to opening up of streets, railways etc.
67.
1. A licensee may, from time to time but subject always to the terms and conditions of his
licence, within his area of supply or transmission or when permitted by the terms of his
licence to lay down or place electric supply lines without the area of supply, without that area
carry out works such as a. to open and break up the soil and pavement of any street, railway or tramway;
b. to open and break up any sewer, drain or tunnel in or under any street, railway or
tramway;
c. to alter the position of any line or works or pipes, other than a main sewer pipe;
d. to lay down and place electric lines, electrical plant and other works;
e. to repair, alter or remove the same;
f. to do all other acts necessary for transmission or supply of electricity.
2. The Appropriate Government may, by rules made by it in this behalf, specify, a. the cases and circumstances in which the consent in writing of the Appropriate
Government, local authority, owner or occupier, as the case may be, shall be required
for carrying out works;
b. the authority which may grant permission in the circumstances where the owner or
occupier objects to the carrying out of works;
c. the nature and period of notice to be given by the licensee before carrying out works;
d. the procedure and manner of consideration of objections and suggestion received in
accordance with the notice referred to in clause (c);
e. the determination and payment of compensation or rent to the persons affected by
works under this section;
f. the repairs and works to be carried out when emergency exists;
68
g. the right of the owner or occupier to carry out certain works under this section and
the payment of expenses therefor;
h. the procedure for carrying out other works near sewers, pipes or other electric lines or
works;
i. the procedure for alteration of the position of pipes, electric lines, electrical plant,
telegraph lines, sewer lines, tunnels, drains, etc.;
j. the procedure for fencing, guarding, lighting and other safety measures relating to
works on streets, railways, tramways, sewers, drains or tunnels and immediate
reinstatement thereof;
k. the avoidance of public nuisance, environmental damage and unnecessary damage to
the public and private property by such works;
l. the procedure for undertaking works which are not reparable by the Appropriate
Government, licensee or local authority;
m. the manner of deposit of amount required for restoration of any railways, tramways,
waterways, etc.;
n. the manner of restoration of property affected by such works and maintenance
thereof;
o. the procedure for deposit of compensation payable by the licensee and furnishing of
security; and
p. such other matters as are incidental or consequential to the construction and
maintenance of works under this section.
3. A licensee shall, in exercise of any of the powers conferred by or under this section and the
rules made thereunder, cause as little damage, detriment and inconvenience as may be, and
shall make full compensation for any damage, detriment or inconvenience caused by him or
by any one employed by him.
4. Where any difference or dispute [including amount of compensation under sub-section (3)]
arises under this section, the matter shall be determined by the Appropriate Commission.
5. The Appropriate Commission, while determining any difference or dispute arising under this
section in addition to any compensation under sub-section (3), may impose a penalty not
exceeding the amount of compensation payable under that sub-section.
69
Provisions relating to overhead lines
Overhead lines.
68.
1. An overhead line shall, with prior approval of the Appropriate Government, be installed or
kept installed above ground in accordance with the provisions of sub-section (2).
2. The provisions contained in sub-section (1) shall not applya. in relation to an electric line which has a nominal voltage not exceeding 11 kilovolts
and is used or intended to be used for supplying to a single consumer;
b. in relation to so much of an electric line as is or will be within premises in the
occupation or control of the person responsible for its installation; or
c. in such other cases as may be prescribed.
3. The Appropriate Government shall, while granting approval under sub-section (1), impose
such conditions (including conditions as to the ownership and operation of the line) as appear
to it to be necessary
4. The Appropriate Government may vary or revoke the approval at any time after the end of
such period as may be stipulated in the approval granted by it.
5. Where any tree standing or lying near an overhead line or where any structure or other object
which has been placed or has fallen near an overhead line subsequent to the placing of such
line, interrupts or interferes with, or is likely to interrupt or interfere with, the conveyance or
transmission of electricity or the 36 to interrupt or interfere with, the conveyance or
transmission of electricity or the accessibility of any works, an Executive Magistrate or
authority specified by the Appropriate Government may, on the application of the licensee,
cause the tree, structure or object to be removed or otherwise dealt with as he or it thinks fit.
6. When disposing of an application under sub-section (5), an Executive Magistrate or authority
specified under that sub-section shall, in the case of any tree in existence before the placing
of the overhead line, award to the person interested in the tree such compensation as he
thinks reasonable, and such person may recover the same from the licensee.
Explanation. - For purposes of this section, the expression “ tree” shall be deemed to include
any shrub, hedge, jungle growth or other plant.
70
Notice to telegraph authority.
69.
1. (1) A licensee shall, before laying down or placing, within ten meters of any telegraph line,
electric line, electrical plant or other works, not being either service lines, or electric lines or
electrical plant, for the repair, renewal or amendment of existing works of which the
character or position is not to be altered,a. submit a proposal in case of a new installation to an authority to be designated by the
Central Government and such authority shall take a decision on the proposal within
thirty days;
b. give not less than ten days' notice in writing to the telegraph authority in case of
repair, renewal or amendment or existing works , specifyingi.
the course of the works or alterations proposed ;
ii.
the manner in which the works are to be utilised ;
iii.
the amount and nature of the electricity to be transmitted;
iv.
the extent to, and the manner in which (if at all), earth returns are to be used ,
and the licensee shall conform to such reasonable requirements, either general or
special, as may be laid down by the telegraph authority within that period for
preventing any telegraph line from being injuriously affected by such works or
alterations: Provided that in case of emergency (which shall be stated by the licensee
in writing to the telegraph authority) arising from defects in any of the electric lines
or electrical plant or other works of the licensee, the licensee shall be required to give
only such notice as may be possible after the necessity for the proposed new works or
alterations has arisen.
2. Where the works of the laying or placing of any service line is to be executed the licensee
shall, not less than forty-eight hours before commencing the work, serve upon the telegraph
authority a notice in writing of his intention to execute such works.
71
PART – IX
Central Electricity Authority
Constitution and functions of Authority
Constitution,etc., of Central Electricity Authority.
70.
1. There shall be a body to be called the Central Electricity Authority to exercise such functions
and perform such duties as are assigned to it under this Act.
54 of 1948.
2. The Central Electricity Authority, established under section 3 of the Electricity (Supply) Act,
1948 and functioning as such immediately before the appointed date, shall be the Central
Electricity Authority for the purposes of this Act and the Chairperson , Members, Secretary
and other officers and employees thereof shall be deemed to have been appointed under this
Act and they shall continue to hold office on the same terms and conditions on which they
were appointed under the Electricity (Supply) Act, 1948.
3. The Authority shall consist of not more than fourteen Members (including its Chairperson)
of whom not more than eight shall be full-time Members to be appointed by the Central
Government.
4. The Central Government may appoint any person, eligible to be appointed as Member of the
Authority, as the Chairperson of the Authority, or, designate one of the full time Members as
the Chairperson of the Authority.
5. The Members of the Authority shall be appointed from amongst persons of ability, integrity
and standing who have knowledge of, and adequate experience and capacity in, dealing with
problems relating to engineering, finance, commerce, economics or industrial matters, and at
least one Member shall be appointed from each of the following categories, namely:a. engineering with specialisation in design, construction, operation and maintenance of
generating stations;
b. engineering with specialisation in transmission and supply of electricity;
c. applied research in the field of electricity; (d) applied economics, accounting,
commerce or finance.
6. The Chairperson and all the Members of the Authority shall hold office during the pleasure
of the Central Government.
7. The Chairperson shall be the Chief Executive of the Authority.
72
8. The head quarters of the Authority shall be at Delhi.
9. The Authority shall meet at the head office or any other place at such time as the Chairperson
may direct, and shall observe such rules of procedure in regard to the transaction of business
at its meetings (including the quorum at its meetings) as it may specify.
10. The Chairperson, or if he is unable to attend a meeting of the Authority, any other Member
nominated by the Chairperson in this behalf and in the absence of such nomination or where
there is no Chairperson, any Member chosen by the Members present from among
themselves shall preside at the meeting.
11. All questions which come up before any meeting of the Authority shall be decided by a
majority of votes of the Members present and voting, and in the event of an equality of votes,
the Chairperson or the person presiding shall have the right to exercise a second or casting
vote.
12. All orders and decisions of the Authority shall be authenticated by the Secretary or any other
officer of the Authority duly authorised by the Chairperson in this behalf.
13. No act or proceedings of the Authority shall be questioned or shall be invalidated merely on
the ground of existence of any vacancy in, or any defect in, the constitution of, the Authority.
14. The Chairperson of the Authority and other full time Members shall receive such salary and
allowances as may be determined by the Central Government and other Members shall
receive such allowances and fees for attending the meetings of the Authority, as the Central
Government may prescribe.
15. The other terms and conditions of service of the Chairperson and Members of the Authority
including, subject to the provisions of sub-section (6), their terms of office shall be such as
the Central Government may prescribe.
Members not to have certain interest.
71.
No Member of the Authority shall have any share or interest, whether in his own name or otherwise,
in any company or other body corporate or an association of persons (whether incorporated or not),
or a firm engaged in the business of generation, transmission, distribution and trading of electricity
or fuel for the generation thereof or in the manufacture of electrical equipment.
Officers and staff of Authority.
72.
73
The Authority may appoint a Secretary and such other officers and employees as it considers
necessary for the performance of its functions under this Act and on such terms as to salary,
remuneration, fee, allowance, pension, leave and gratuity, as the authority may in consultation with
the Central Government, fix:
Provided that the appointment of the Secretary shall be subject to the approval of the Central
Government.
Functions and duties of Authority.
73.
The Authority shall perform such functions and duties as the Central Government may prescribe or
direct, and in particular to a. advise the Central Government on the matters relating to the national electricity policy,
formulate short-term and perspective plans for development of the electricity system and coordinate the activities of the planning agencies for the optimal utilisation of resources to
subserve the interests of the national economy and to provide reliable and affordable
electricity for all consumers;
b. specify the technical standards for construction of electrical plants, electric lines and
connectivity to the grid;
c. specify the safety requirements for construction, operation and maintenance of electrical
plants and electric lines;
d. specify the Grid Standards for operation and maintenance of transmission lines;
e. specify the conditions for installation of meters for transmission and supply of electricity;
f. promote and assist in the timely completion of schemes and projects for improving and
augmenting the electricity system;
g. promote
measures
for
the electricity industry;
advancing
the
skill
of
persons
engaged
in
h. advise the Central Government on any matter on which its advice
is sought or make recommendation to that Government on any matter if, in the
opinion of the Authority, the recommendation would help in improving the
generation, transmission, trading, distribution and utilisation of electricity;
i. collect
and
record
the
data
concerning
the
generation,
transmission, trading, distribution and utilisation of electricity and carry out studies
relating to cost, efficiency, competitiveness and such like matters;
74
j. make
public
from
time
to
time
information
Act, and provide for the publication of reports and investigations;
k. promote
research
in
matters
transmission, distribution and trading of electricity;
affecting
l. carry out, or cause to be carried out , any
purposes of generating or transmitting or distributing electricity;
secured
under
the
investigation
this
generation,
for
the
m. advise
any
State
Government,
licensees
or
the
generating
companies on such matters which shall enable them to operate and maintain the
electricity system under their ownership or control in an improved manner and
where necessary, in co-ordination with any other Government, licensee or the
generating company owning or having the control of another electricity system;
n. advise
the
Appropriate
Government
Commission on all technical matters relating to
distribution of electricity;and
and
the
Appropriate
generation, transmission and
o. discharge such other functions as may be provided under this Act.
Certain powers and directions
Power to require statistics and returns.
74.
It shall be the duty of every licensee, generating company or person generating electricity for its or
his own use to furnish to the Authority such statistics, returns or other information relating to
generation, transmission, distribution, trading and use of electricity as it may require and at such
times and in such form and manner as may be specified by the Authority.
Directions by Central Government to Authority.
75.
1. In the discharge of its functions, the Authority shall be guided by such directions in matters
of policy involving public interest as the Central Government may give to it in writing.
2. If any question arises as to whether any such direction relates to a matter of policy involving
public interest, the decision of the Central Government thereon shall be final.
75
PART – X
Regulatory Commissions
Constitution, powers and functions of Central Commission
Constitution of Central Commission.
76.
1. There shall be a Commission to be known as the Central Electricity Regulatory Commission
to exercise the powers conferred on, and discharge the functions assigned to, it under this
Act.
14 of 1998.
2. the Central Commission for the purposes of this Act and the Chairperson, Members,
Secretary, and other officers and employees thereof shall deemed to have been appointed
under this Act and they shall continue to hold office on the same terms and conditions on
which they were appointed under the Electricity Regulatory Commissions Act, 1998.
Provided that the Chairperson and other Members of the Central Commission appointed,
before the commencement of this Act, under the Electricity Regulatory Commissions Act,
1998, may, on the recommendations of the Selection Committee constituted under subsection (1) of section 78, be allowed, to opt for the terms and conditions under this Act by
the Central Government.
3. The Central Commission shall be a body corporate by the name aforesaid, having perpetual
succession and a common seal with power to acquire,hold and dispose of property, both
movable and immovable, and to contract and shall, by the said name, sue or be sued.
4. The head office of the Central Commission shall be at such place as the Central Government
may, by notification, specify.
5. The Central Commission shall consist of the following Members namely:a. a Chairperson and three other Members;
b. the Chairperson of the Authority who shall be the Member, ex officio.
6. The Chairperson and Members of the Central Commission shall be appointed by the Central
Government on the recommendation of the Selection Committee referred to in section 78.
76
Qualification for appointment of Members of Central Commission.
77.
1.
The Chairperson and the Members of the Central Commission shall be persons
having adequate knowledge of, or experience in,or shown capacity in, dealing with,
problems relating to engineering, law, economics, commerce, finance or, management and
shall be appointed in the following manner, namely:a. one person having qualifications and experience in the field of engineering
with specialisation in generation, transmission or distribution of electricity;
b. one person having qualifications and experience in the field of finance;
c. two persons having qualifications and experience in the field of economics,
commerce,
law
or
management:
Provided that not more than one Member shall be appointed under the same
category under clause (c).
2. Notwithstanding anything contained in sub-section (1), the Central Government may
appoint any person as the Chairperson from amongst persons who is,or has been, a
Judge of the Supreme Court or the Chief Justice of a High Court:
Provided that no appointment under this sub-section shall be made except after
consultation with the Chief Justice of India.
3. The Chairperson or any other Member of the Central Commission shall not hold any
other office.
4. The Chairperson shall be the Chief Executive of the Central Commission.
Constitution of Selection Committee to recommend Members
78.
1. The Central Government shall, for the purposes of selecting the Members of
the Appellate Tribunal and the Chairperson and Members of the Central
Commission, constitute a Selection Committee consisting of –
a. Member of the Planning Commission incharge of the energy sector
……………… Chairperson;
b. Secretary-in-charge of the Ministry of the Central Government dealing
with the Department of the Legal Affairs …………. Member;
77
c. Chairperson of the Public Enterprises Selection Board …….. Member;
d. a person to be nominated by the Central Government in accordance
with sub-section (2)………………… Member ;
e. a person to be nominated by the Central Government in accordance
with sub-section (3) ………………… Member ;
f. Secretary-in-charge of the Ministry of the Central Government dealing
with
power
…………………..
Member.
1 of 1956
2. For the purposes of clause (d) of sub-section (1), the Central Government
shall nominate from amongst persons holding the post of chairperson or
managing director, by whatever name called, of any public financial
institution specified in section 4A of the Companies Act, 1956.
3. For the purposes of clause (e) of sub-section (1), the Central Government
shall, by notification, nominate from amongst persons holding the post of
director or the head of the institution, by whatever name called, of any
research, technical or management institution for this purpose.
4. Secretary-in-charge of the Ministry of the Central Government dealing with
Power shall be the Convenor of the Selection Committee.
5. The Central Government shall, within one month from the date of occurrence
of any vacancy by reason of death, resignation or removal of a Member of the
Appellate Tribunal or the Chairperson or a Member of the Central
Commission and six months before the superannuation or end of tenure of the
Member of the Appellate Tribunal or Member of the Central Commission,
make a reference to the Selection Committee for filling up of the vacancy.
6. The Selection Committee shall finalise the selection of the Chairperson and
Members referred to in sub-section (5) within three month from the date on
which the reference is made to it.
7. The Selection Committee shall recommend a panel of two names for every
vacancy referred to it.
8. Before recommending any person for appointment as Member of the
Appellate Tribunal or the Chairperson or other Member of the Central
Commission, the Selection Committee shall satisfy itself that such person
78
does not have any financial or other interest which is likely to affect
prejudicially his functions as the Chairperson or Member.
9. No appointment of the Chairperson or other Member shall be invalid merely
by reason of any vacancy in the Selection Committee:
Provided that nothing contained in this section shall apply to the appointment
of a person as the Chairperson of the Central Commission where such person
is, or has been , a Judge of the Supreme Court or the Chief Justice of a High
person is, or has been , a Judge of the Supreme Court or the Chief Justice of a
High Court.
Functions of Central Commission
79.
1. The Central Commission shall discharge the following functions,
namely:a. to regulate the tariff of generating companies owned or
controlled by the Central Government;
b. to regulate the tariff of generating companies other than those
owned or controlled by the Central Government specified in
clause (a), if such generating companies enter into or otherwise
have a composite scheme for generation and sale of electricity
in more than one State;
c. to regulate the inter-State transmission of electricity ;
d. to determine tariff for inter-State transmission of electricity;
e. to issue licenses to persons to function as transmission licensee
and electricity trader with respect to their inter-State
operations.
f. to adjudicate upon disputes involving generating companies or
transmission licensee in regard to matters connected with
clauses (a) to (d) above and to refer any dispute for arbitration;
g. to levy fees for the purposes of this Act;
79
h. to specify Grid Code having regard to Grid Standards;
i. to specify and enforce the standards with respect to quality,
continuity and reliability of service by licensees.
j. to fix the trading margin in the inter-State trading of electricity,
if considered, necessary;
k. to discharge such other functions as may be assigned under this
Act.
2. The Central Commission shall advise the Central Government on all
or any of the following matters, namely :- (a) Advise the Central
Government on all or any of the following matters, namely:- (i)
formulation of National electricity Policy and tariff policy: (ii)
promotion of competition, efficiency and economy in activities of the
electricity industry; (iii) promotion of investment in electricity
industry; (iv) any other matter referred to the Central Commission by
that Government.
3. The Central Commission shall ensure transparency while exercising
its powers and discharging its functions.
4. In discharge of its functions, the Central Commission shall be guided
by the National Electricity Policy, National Electricity Plan and tariff
policy published under section 3.
Central
Advisory
Committee.
80.
5. The Central Commission may, by notification, establish with effect
from such date as it may specify in such notification, a Committee to
be known as the Central Advisory Committee.
6. The Central Advisory Committee shall consist of not more than thirtyone members to represent the interests of commerce, industry,
transport, agriculture, labour, consumers, non-governmental
organisations and academic and research bodies in the electricity
sector.
7. The Chairperson of the Central Commission shall be the exofficio
Chairperson of the Central Advisory Committee and the Members of
that Commission and Secretary to the Government of India in charge
80
of the Ministry or Department of the Central Government dealing with
Consumer Affairs and Public Distribution System shall be the exofficio Members of the Committee.
Objects
81.
of
Central
Advisory
Committee
The objects of the Central Advisory Committee shall be to advise the Central
Commission on:-viii.
major questions of policy;
ix.
matters relating to quality, continuity and extent of service provided
by the licensees;
x.
compliance by the licensees with the conditions and requirements of
their licence;
xi.
protection of consumer interest;
xii.
electricity supply and overall standards of performance by utilities.
Constitution, powers and functions of the State Commissions
Constitution
of
State
Commission
82.
13.
Every State Government shall, within six months from the appointed
date, by notification, constitute for the purposes of this Act, a Commission for
the State to be known as the (name of the State) Electricity Regulatory
Commission:
14 of 1998
Provided that the State Electricity Regulatory Commission,
established by a State Government under section 17 of the Electricity
Regulatory Commissions Act, 1998 and the enactments specified in
the Schedule, and functioning as such immediately before the
appointed date shall be the State Commission for the purposes of this
Act and the Chairperson, Members, Secretary, and other officers and
other employees thereof shall continue to hold office, on the same
terms and conditions on which they were appointed under those Acts.
81
Provided further that the Chairperson and other Members of the State
Commission appointed before the commencement of this Act under
the Electricity Regulatory Commissions Act, 1998 or under the
enactments specified in the Schedule, may on the recommendations of
the Selection Committee constituted under sub-section (1) of Section
85 be allowed to opt for the terms and conditions under this Act by the
concerned State Government.
14.
The State Commission shall be a body corporate by the name aforesaid, having perpetual
succession and a common seal, with power to acquire, hold and dispose of property, both movable
and immovable, and to contract and shall, by the said name, sue or be sued.
15.
The head office of the State Commission shall be at such place as the
State Government may, by notification, specify.
16.
The State Commission shall consist of not more than three Members,
including the Chairperson.
17.
The Chairperson and Members of the State Commission shall be
appointed by the State Government on the recommendation of a
Selection Committee referred to in section 85
Joint Commission
83.
18.
Notwithstanding anything to the contrary contained in section 82, a
Joint Commission may be constituted by an agreement to be entered into a. by two or more Governments of States; or
b. by the Central Government, in respect of one or more Union
territories, and one or more Governments of States,
and shall be in force for such period and shall be subject to
renewal for each further period, if any, as may be stipulated in
the agreement:
14 of 1998
Provided that the Joint Commission, constituted under section
21 A of Electricity Regulatory Commissions Act, 1998 and
functioning as such immediately before the appointed day,
shall be the Joint Commission for the purposes of this Act and
the Chairperson, members, Secretary and other officers and
82
employees thereof shall be deemed to have been appointed as
such under this Act and they shall continue to hold office, on
the same terms and conditions on which they were appointed
under the Electricity Regulatory Commissions Act, 1998.
19.
The Joint Commission shall consists of 1 Member from each of the participating States and
Union Territories and the Chairperson shall be appointed from amongst the Members by consensus,
failing which by rotation.
20.
An agreement under sub-section (1) shall contain provisions as to the
name of the Joint Commission, the manner in which the participating
States may be associated in the selection of the Chairperson and
Members of the Joint Commission, manner of appointment of
Members and appointment of Chairperson by rotation or consensus,
places at which the Commission shall sit, apportionment among the
participating States of the expenditure in connection with the Joint
Commission, manner in which the differences of opinion between the
Joint Commission and the State Government concerned would be
resolved and may also contain such other supplemental, incidental and
consequential provisions not inconsistent with this Act as may be
deemed necessary or expedient for giving effect to the agreement.
21.
The Joint Commission shall determine tariff in respect of the
participating States or Union Territories separately and independently.
22.
Notwithstanding anything contained in this section, the Central
Government may, if so authorised by all the participating States,
constitute a Joint Commission and may exercise the powers in respect
of all or any of the matters specified under sub-section (3) and
specifically so authorized by the participating States.
Qualifications of appointment of Chairperson and Members of State
Commission.
84.
23.
The Chairperson and the Members of the State Commission shall be
persons of ability, integrity and standing who have adequate knowledge of,
and have shown capacity in, dealing with problems relating to engineering,
finance, commerce, economics, law or management.
24.
Notwithstanding anything contained in sub-section (1), the State
Government may appoint any person as the Chairperson from amongst
83
persons who is, or has been, a Judge of a High Court: 45 is, or has
been, a Judge of a High Court: Provided that no appointment under
this sub-section shall be made except after consultation with the Chief
Justice of that High Court.
25.
The Chairperson or any other Member of the State Commission shall
not hold any other office.
26.
The Chairperson shall be the Chief Executive of the State
Commission.
Constitution of Selection Committee to select Members of State
Commission.
85.
27.
The State Government shall, for the purposes of selecting the
Members of the State Commission, constitute a Selection Committee
consisting of –
a. a person who has been a Judge of the High Court….
Chairperson;
b. the Chief Secretary of the concerned State… … … … .
….Member;
c. the Chairperson of the Authority or the Chairperson of the
Central Commission … … … … .. Member: Provided that
nothing contained in this section shall apply to the appointment
of a person as the Chairperson who is or has been a Judge of
the High Court.
28.
The State Government shall, within one month from the date of
occurrence of any vacancy by reason of death, resignation or removal
of the Chairperson or a Member and six months before the
superannuation or end of tenure of the Chairperson or Member, make
a reference to the Selection Committee for filling up of the vacancy.
29.
The Selection Committee shall finalise the selection of the
Chairperson and Members within three month from the date on which
the reference is made to it.
30.
The Selection Committee shall recommend a panel of two names for
every vacancy referred to it.
84
31.
Before recommending any person for appointment as the Chairperson
or other Member of the State Commission, the Selection Committee
shall satisfy itself that such person does not have any financial or other
interest which is likely to affect prejudicially his functions as
Chairperson or Member, as the case may be. (6) No appointment of
Chairperson or other Member shall be invalid merely by reason of any
vacancy in the Selection Committee.
Functions
of
State
Commission
86.
32.
The State Commission shall discharge the following functions,
namely:
a. determine the tariff for generation, supply, transmission and
wheeling of electricity, wholesale, bulk or retail, as the case
may be, within the State: Providing that where open access has
been permitted to a category of consumers under section 42,
the State Commission shall determine only the wheeling
charges and surcharge thereon, if any, for the said category of
consumers;
b. regulate electricity purchase and procurement process of
distribution licensees including the price at which electricity
shall be procured from the generating companies or licensees
or from other sources through 46 agreements for purchase of
power for distribution and supply within the State;
c. facilitate intra-state transmission and wheeling of electricity;
d. issue licences to persons seeking to act as transmission
licensees, distribution licensees and electricity traders with
respect to their operations within the State;
e. promote congenration and generation of electricity from
renewable sources of energy by providing suitable measures
for connectivity with the grid and sale of electricity to any
person, and also specify, for purchase of electricity from such
sources, a percentage of the total consumption of electricity in
the area of a distribution licence;
85
f. adjudicate upon the disputes between the licensees, and
generating companies and to refer any dispute for arbitration;
g. levy fee for the purposes of this Act;
h. specify State Grid Code consistent with the Grid Code
specified under clause (h) of sub-section (1) of section 79;
i. specify or enforce standards with respect to quality, continuity
and reliability of service by licensees;
j. fix the trading margin in the intra-State trading of electricity, if
considered, necessary; and
k. discharge such other functions as may be assigned to it under
this Act.
33.
The State Commission shall advise the State Government on all or any
of the following matters, namely :-.
i.
promotion of competition, efficiency and economy in activities
of the electricity industry;
ii.
promotion of investment in electricity industry;
iii.
reorganization and restructuring of electricity industry in the
State;
iv.
matters concerning generation, transmission , distribution and
trading of electricity or any other matter referred to the State
Commission by that Government.
34.
The State Commission shall ensure transparency while exercising its
powers and discharging its functions.
35.
In discharge of its functions the State Commission shall be guided by
the National Electricity Policy, National Electricity Plan and tariff
policy published under section 3.
State
87.
Advisory
Committee
86
36.
The State Commission may, by notification, establish with effect from
such date as it may specify in such notification, a Committee to be known as
the State Advisory Committee.
37.
The State Advisory Committee shall consist of not more than twentyone members to represent the interests of commerce, industry,
transport, agriculture, labour, consumers, non-governmental
organisations and academic and research bodies in the electricity
sector.
38.
The Chairperson of the State Commission shall be the ex-officio
Chairperson of the State Advisory Committee and the Members of the
State Commission and the Secretary to State Government in charge of
the Ministry or Commission and the Secretary to State Government in
charge of the Ministry or Department dealing with Consumer Affairs
and Public Distribution System shall be the ex-officio Members of the
Committee.
Objects
88.
of
State
Advisory
Committee
The objects of the State Advisory Committee shall be to advise the
Commission on –
xxxix.
major questions of policy;
xl.
matters relating to quality, continuity and extent of service provided
by the licensees;
xli.
compliance by licensees with the conditions and requirements of their
licence:
xlii.
protection of consumer interest; and
xliii.
electricity supply and overall standards of performance by utilities.
Appropriate Commission – Other Provisions
Term
89.
of
office
and
conditions
of
service
of
members
87
44.
The Chairperson or other Member shall hold office for a term
of five years from the date he enters upon his office; Provided that the
Chairperson or other Member in the Central Commission or the State
Commission shall not be eligible for re-appointment in the same
capacity as the Chairperson or a Member in that Commission in which
he had earlier held office as such : Provided further that no
Chairperson or Member shall hold office as such after he has attained
the age of sixty-five years.
45.
The salary, allowances and other terms and conditions of service of
the Chairperson and Members shall be such as may be prescribed by
the Appropriate Government. Provided that the salary, allowances and
other terms and conditions of service of the Members, shall not be
varied to their disadvantage after appointment.
46.
Every Member shall, before entering upon his office, make and
subscribe to an oath of office and secrecy in such form and in such
manner and before such authority as may be prescribed.
47.
Notwithstanding anything contained in sub-section (1), a Member
may-
.
Relinquish his office by giving in writing to the Appropriate
Government a notice of not less than three months; or
a.
48.
be removed from his office in accordance with the provisions
of section 90.
Any member ceasing to hold office as such shall –
.
not accept any commercial employment for a period of two
years from the date he ceases to hold such office; and
a.
not represent any person before the Central Commission or any
State Commission in any manner.
Explanation. - For the purposes of this sub-section "commercial
employment” means employment in any capacity in any organisation
which has been a party to the proceedings before the Appropriate
Commission or employment in any capacity under, or agency of, a
person engaged in trading, commercial, industrial or financial business
in electricity industry and includes a director of a company or partner
88
of a firm or setting up practice either independently or as partner of a
firm or as an advisor or a consultant.
Removal
of
member.
90.
49.
No Member shall be removed from office except in accordance with
the provisions of this section.
50.
The Central Commission, in the case of a Member of the Central
Commission, and the State Government, in the case of a Member of
the State Commission, may by order remove from office any Member,
if he.
51.
has been adjudged an insolvent;
a.
has been convicted of an offence which, in the opinion of the
Appropriate Government, involves moral turpitude;
b.
has become physically or mentally incapable of acting as a
Member;
c.
has acquired such financial or other interest as is likely to
affect prejudicially his functions as a Member;
d.
has so abused his position as to render his continuance in office
prejudicial to the public interest; or
e.
has been guilty of proved misbehaviour: Provided that no
Member shall be removed from his office on any ground
specified in clauses (d), (e) and (f) unless the Chairperson of
the Appellate Tribunal on a reference being made to him in this
behalf by the Central Government, or the State Government, as
the case may be, has, on an inquiry, held by him in accordance
with such procedure as may be prescribed by the Central
Government, reported that the Member ought on such ground
or grounds to be removed.
The Central Government or the State Government, as the case may be,
may, in consultation with the Chairperson of the Appellate Tribunal
suspend any Member of the Appropriate Commission in respect of
whom a reference has been made to the Chairperson of the Appellate
Tribunal, under sub-section (2) until the Central Government or the
89
State Government, as the case may be, has passed orders on receipt of
the report of the Chairperson of the Appellate Tribunal, on such
reference :
Provided that nothing contained in this section shall apply to the
Chairperson of the Appropriate Commission who, at the time of his
appointment as such is a sitting Judge of the Supreme court or the
chief Justice of a High Court or a Judge of a High Court.
Proceedings and powers of the Appropriate Commission
Secretary
Officers
and
other
91.
52.
The Appropriate Commission may appoint a Secretary to exercise
such powers and perform such duties as may be specified.
employees of Appropriate Commission .
such powers and perform such duties as may be specified.
53.
The Appropriate Commission may, with the approval of the Appropriate Government,
specify the numbers, nature and categories of other officers and employees.
54.
The salaries and allowances payable to, and other term and conditions
of service of, the Secretary, officers and other employees shall be such
as may be specified with the approval of the Appropriate Government.
55.
The Appropriate Commission may appoint consultants required to
assist that Commission in the discharge of its functions on the terms
and conditions as may be specified. 5 of 1908
Proceedings
of
Appropriate
Commission.
92.
56.
The Appropriate Commission shall meet at the head office or any
other place at such time as the Chairperson may direct, and shall observe such
rules of procedure in regard to the transaction of business at its meetings
(including the quorum at its meetings) as it may specify.
57.
The Chairperson, or if he is unable to attend a meeting of the
Appropriate Commission, any other Member nominated by the
Chairperson in this behalf and, in the absence of such nomination or
90
where there is no Chairperson, any Member chosen by the Members
present from among themselves, shall preside at the meeting.
58.
All questions which come up before any meeting of the Appropriate
Commission shall be decided by a majority of votes of the Members
present and voting, and in the event of an equality of votes, the
Chairperson or in his absence, the person presiding shall have a
second or casting vote.
59.
Save as otherwise provided in sub-section (3), every Member shall
have one vote.
60.
All orders and decisions of the Appropriate Commission shall be
authenticated by its Secretary or any other officer of the Commission
duly authorised by the Chairperson in this behalf.
Vacancies,
93.
etc.,
not
to
invalidate
proceedings.
No act or proceedings of the Appropriate Commission shall be questioned or
shall be invalidated merely on the ground of existence of any vacancy or
defect in the constitution of the Appropriate Commission.
Powers
of
Appropriate
Commission
94.
61.
The Appropriate Commission shall, for the purposes of any inquiry or
proceedings under this Act, have the same powers as are vested in a civil
court under the Code of Civil Procedure, 1908 in respect of the following
matters, namely: .
summoning and enforcing the attendance of any person and
examining him on oath;
a.
discovery and production of any document or other material
object producible as evidence;
b.
receiving evidence on affidavits;
c.
requisitioning of any public record;
d.
issueing commission for the examination of witnesses;
e.
reviewing its decisions, directions and orders; 5 of 1908. 50
91
f.
any other matter which may be prescribed.
62.
The Appropriate Commission shall have the powers to pass such
interim order in any proceeding, hearing or matter before the
Appropriate Commission, as that Commission may consider
appropriate.
63.
The Appropriate Commission may authorise any person, as it deems
fit, to represent the interest of the consumers in the proceedings before
it.
Proceedings
95.
before
Commission.
All proceedings before the Appropriate Commission shall be deemed to be
judicial proceedings within the meaning of sections 193 and 228 of the Indian
Penal Code and the Appropriate Commission shall be deemed to be a civil
court for the purposes of sections 345 and 346 of the Code of Criminal
Procedure, 1973.
45 of 1860. 2 of 1974.
Powers of entry and seizure.
96.
The Appropriate Commission or any officer, not below the rank of a
Gazetted Officer specially authorised in this behalf by the Commission, may
enter any building or place where the Commission has reason to believe that
any document relating to the subject matter of the inquiry may be found, and
may seize any such document or take extracts or copies therefrom subject to
the provisions of section 100 of the Code of Criminal Procedure, 1973,
insofar as it may be applicable.
Delegation
97.
.
The Appropriate Commission may, by general or special order in writing,
delegate to any Member, Secretary officer of the Appropriate Commission or
any other person subject to such conditions, if any, as may be specified in the
order, such of its powers and functions under this Act (except the powers to
adjudicate disputes under Section 79 and Section 86 and the powers to make
regulations under section 178 or section 181) as it may deem necessary.
Grants, Fund, Accounts, Audit and Report
92
Grants
98.
and
loans
by
Central
Government
The Central Government may, after due appropriation made by Parliament in
this behalf, make to the Central Commission grants and loans of such sums of
money as that Government may consider necessary.
Establishment
of
Fund
by
Central
Government
99.
64.
There shall be constituted a Fund to be called the Central Electricity
Regulatory Commission Fund and there shall be credited thereto.
65.
66.
any grants and loans made to the Central Commission by the
Central Government under section 98;
a.
all fees received by the Central Commission under this Act;
b.
all sums received by the Central Commission from such other
sources as may be decided upon by the Central Government.
The Fund shall be applied for meeting –
.
the salary, allowances and other remuneration of Chairperson,
Members, Secretary, officers and other employees of the
Central Commission;
a.
the expenses of the Central Commission in discharge of its
function under section 79;
b.
the expenses on objects and for purposes authorised by this
Act.
The Central Government may, in consultation with the Comptroller
and Auditor-General of India, prescribe the manner of applying the
Fund for meeting the expenses specified in clause (b) or clause (c) of
sub-section (2).
Accounts
and
Audit
of
Central
Commission.
100.
67.
The Central Commission shall maintain proper accounts and other
relevant records and prepare an annual statement of accounts in such form as
93
may be prescribed by the Central Government in consultation with the
Comptroller and Auditor-General of India.
68.
The accounts of the Central Commission shall be audited by the
Comptroller and Auditor-General of India at such intervals as may be
specified by him and any expenditure incurred in connection with such
audit shall be payable by the Central Commission to the Comptroller
and Auditor General of India.
69.
The Comptroller and Auditor-General of India and any person
appointed by him in connection with the auditing of the accounts of
the Central Commission under this Act shall have the same rights and
privileges and authority in connection with such audit as the
Comptroller and Auditor-General of India has in connection with the
audit of the Government accounts and, in particular, shall have the
right to demand the production of books, accounts, connected
vouchers and other documents and papers and to inspect any of the
offices of the Central Commission.
70.
The accounts of the Central Commission, as certified by the
Comptroller and Auditor- General of India or any other person
appointed by him in this behalf, together with the audit report thereon,
shall be forwarded annually to the Central Government and that
Government shall cause the same to be laid, as soon as may be after it
is received, before each House of Parliament.
Annual
Report
of
Central
Commission
101.
71.
The Central Commission shall prepare once every year, in such form
and at such time as may be prescribed, an annual report giving a summary of
its activities during the previous year and copies of the report shall be
forwarded to the Central Government.
72.
Grants
102.
A copy of the report received under sub-section (1) shall be laid, as
soon as may be after it is received, before each House of Parliament.
and
Loans
by
State
Government
94
The State Government may, after due appropriation made by Legislature of a
State in this behalf, make to the State Commission grants and loans of such
sums of money as that Government may consider necessary.
Establishment
of
Fund
by
State
Government
103.
73.
There shall be constituted a Fund to be called the State Electricity
Regulatory Commission fund and there shall be credited thereto.
74.
75.
any grants and loans made to the State Commission by the
State Government under Section 102;
a.
all fees received by the State Commission under this Act;
b.
all sums received by the State Commission from such other
sources as may be decided upon by the State Government.
The Fund shall be applied for meeting –
.
the salary, allowances and other remuneration of Chairperson,
Members, Secretary, officers and other employees of the State
Commission;
a.
the expenses of the State Commission in discharge of its
function under Section 86; and
b.
the expenses on objects and for purposes authorised by this
Act.
The State Government may, in consultation with the Comptroller and
Auditor-General of India, prescribe the manner of applying the Fund
for meeting the expenses specified in clause (b) or clause (c) of subsection (2).
Accounts
and
audit
of
State
Commission
104.
76.
The State Commission shall maintain proper accounts and other
relevant records and prepare annual statement of accounts in such forms as
may be prescribed by the State Government in consultation with the
Comptroller and Auditor-General of India.
77.
The Accounts of the State Commission shall be audited by the
Comptroller and Auditor-General of India at such intervals as may be
95
specified by him and any expenditure incurred in connection with such
audit shall be payable by the State Commission to the Comptroller and
Auditor- General of India.
78.
The Comptroller and Auditor-General of India and any person
appointed by him in connection with the audit of the accounts of the
State Commission under this Act shall have the same rights and
privileges and authority in connection with such audit as the
Comptroller and Auditor-General of India generally has in connection
with the audit of Government accounts and, in particular, shall have
the right to demand the production of books, accounts, connected
vouchers and other documents and papers and to inspect any of the
offices of the State Commission.
79.
The accounts of the State Commission, as certified by the Comptroller
and Auditor-General of India or any other person appointed by him in
this behalf, together with the audit report thereon shall be forwarded
annually to the State Government and that Government shall cause the
same to be laid , as soon as may be after it is received, before the State
Legislature.
Annual
report
of
State
Commission
105.
80.
The State Commission shall prepare once every year in such form and
at such time as may be prescribed, an annual report giving a summary of its
activities during the previous year and copies of the report shall be forwarded
to the State Government.
81.
A copy of the report received under sub-section ( 1 ) shall be laid, as
soon as may be after it is received, before the State Legislature.
Budget
106.
of
Appropriate
Commission
The Appropriate Commission shall prepare, in such form and at such time in
each financial year as may be prescribed, its budget for the next financial
year, showing the estimated receipts and expenditure of that Commission and
forward the same to the Appropriate Government.
Directions
107.
by
Central
Government
96
82.
In the discharge of its functions, the Central Commission shall be
guided by such directions in matters of policy involving public interest as the
Central Government may give to it in writing.
83.
If any question arises as to whether any such direction relates to a
matter of policy involving public interest, the decision of the Central
Government thereon shall be final.
Directions
by
State
Government.
108.
84.
In the discharge of its functions, the State Commission shall be guided
by such directions in matters of policy involving public interest as the State
Government may give to it in writing.
85.
If any question arises as to whether any such direction relates to a
matter of policy involving public interest, the decision of the State
Government thereon shall be final.
Directions
109.
to
Joint
Commission.
Notwithstanding anything contained in this Act, where any Joint Commission
is established under section 83 –
(a) the Government of the State, for which the Joint Commission is 53
established, shall be competent to give any direction under this Act
only in cases where such direction relates to matter within the
exclusive territorial jurisdiction of the State; (b) the Central
Government alone shall be competent to give any direction under this
Act where such direction relates to a matter within the territorial
jurisdiction of two or more States or pertaining to a Union territory if
the participating Governments fail to reach an agreement or the
participating States or majority of them request the Central
Government to issue such directions.
97
PART – X1
Appellate Tribunal For Electricity
Establishment of Appellate Tribunal.
110.
The Central Government shall, by notification, establish an Appellate Tribunal to be known as the
Appellate Tribunal for Electricity to hear appeals against the orders of the adjudicating officer or the
Appropriate Commission under this Act.
Appeal to Appellate Tribunal.
111.
1. Any person aggrieved by an order made by an adjudicating officer under this Act (except
under section 127) or an order made by the Appropriate Commission under this Act may
prefer an appeal to the Appellate Tribunal for Electricity: Provided that any person appealing
against the order of the adjudicating officer levying and penalty shall, while filling the appeal
, deposit the amount of such penalty: Provided further that where in any particular case, the
Appellate Tribunal is of the opinion that the deposit of such penalty would cause undue
hardship to such person, it may dispense with such deposit subject to such conditions as it
may deem fit to impose so as to safeguard the realisation of penalty.
2. Every appeal under sub-section (1) shall be filed within a period of forty-five days from the
date on which a copy of the order made by the adjudicating officer or the Appropriate
Commission is received by the aggrieved person and it shall be in such form, verified in such
manner and be accompanied by such fee as may be prescribed: Provided that the Appellate
Tribunal may entertain an appeal after the expiry of the said period of forty-five days if it is
satisfied that there was sufficient cause for not filing it within that period.
3. On receipt of an appeal under sub-section (1), the Appellate Tribunal may, after giving the
parties to the appeal an opportunity of being heard, pass such orders thereon as it thinks fit,
confirming, modifying or setting aside the order appealed against.
4. The Appellate Tribunal shall send a copy of every order made by it to the parties to the
appeal and to the concerned adjudicating officer or the Appropriate Commission, as the case
may be.
5. The appeal filed before the Appellate Tribunal under sub-section (1) shall be dealt with by it
as expeditiously as possible and endeavour shall be made by it to dispose of the appeal
finally within one hundred and eighty days from the date of receipt of the appeal: Provided
that where any appeal could not be disposed off within the said period of one hundred and
98
eighty days, the Appellate Tribunal shall record its reasons in writing for not disposing of the
appeal within the said period.
6. The Appellate Tribunal may, for the purpose of examining the legality, propriety or
correctness of any order made by the adjudicating officer or legality, propriety or correctness
of any order made by the adjudicating officer or the Appropriate Commission under this Act,
as the case may be, in relation to any proceeding, on its own motion or otherwise, call for the
records of such proceedings and make such order in the case as it thinks fit.
Composition of Appellate Tribunal.
112.
1. The Appellate Tribunal shall consist of a Chairperson and three other Members.
2. Subject to the provisions of this Act,a. the jurisdiction of the Appellate Tribunal may be exercised by Benches thereof;
b. a Bench may be constituted by the Chairperson of the Appellate Tribunal with two or
more Members of the Appellate Tribunal as the Chairperson of the Appellate
Tribunal may deem fit: Provided that every Bench constituted under this clause shall
include at least one Judicial Member and one Technical Member;
c. the Benches of the Appellate Tribunal shall ordinarily sit at Delhi and such other
places as the Central Government may, in consultation with the Chairperson of the
Appellate Tribunal, notify;
d. the Central Government shall notify the areas in relation to which each Bench of the
Appellate Tribunal may exercise jurisdiction.
3. Notwithstanding anything contained in sub-section (2), the Chairperson of the Appellate
Tribunal may transfer a Member of the Appellate Tribunal from one Bench to another
Bench. Explanation.- For the purposes of this Chapter,i.
“ Judicial Member” means a Member of the Appellate Tribunal appointed as such
under sub-clause (i) of caluse (b) of sub-section (1) of section 113, and includes the
Chairperson of the Appellate Tribunal;
ii.
“ Technical Member” means a Member of the Appellate Tribunal appointed as such
under sub-clause (ii) or sub-clause (iii) of clause (b) of subsection (1) of section 113.
99
Qualifications for appointment of Chairperson and Member of the Appellate Tribunal.
113.
1. A person shall not be qualified for appointment as the Chairperson of the Appellate Tribunal
or a Member of the Appellate Tribunal unless hea. in the case of the Chairperson of the Appellate Tribunal, is, or has been, a judge of
the Supreme Court or the Chief Justice of a High Court; and
b. in the case of a Member of the Appellate Tribunal,i.
is, or has been, or is qualified to be, a Judge of a High Court; or
ii.
is, or has been, a Secretary for at least one year in the Ministry or Department
of the Central Government dealing with economic affairs or matters or
infrastructure; or
iii.
is, or has been, a person of ability and standing, having adequate knowledge
or experience in dealing with the matters relating to electricity generation,
transmission and distribution and regulation or economics, commerce, law or
management.
2. The Chairperson of the Appellate Tribunal shall be appointed by the Central Government
after consultation with the Chief Justice of India.
3. The Members of the Appellate Tribunal shall be appointed by the Central Government on the
recommendation of the Selection Committee referred to in section 78.
4. Before appointing any person for appointment as Chairperson or other Member of the
Appellate Tribunal, the Central Government shall satisfy itself that such person does not
have any financial or other interest which is likely to affect prejudicially his functions as
such Chairperson or Member.
Term of office.
114.
The Chairperson of the Appellate Tribunal or a Member of the Appellate Tribunal shall hold office
as such for a term of three years from the date on which he enters upon his office:
Provided that such Chairperson or other Member shall be eligible for reappointment for a second
term of three years:
Provided further that no Chairperson of the Appellate Tribunal or Member of the Appellate Tribunal
shall hold office as such after he has attained,100
a. in the case of the Chairperson of the Appellate Tribunal , the age of seventy years;
b. in the case of a Member of the Appellate Tribunal, the age of sixty-five years.
Terms and conditions of service.
115.
The salary and allowances payable to, and the other terms and conditions of service of, the
Chairperson of the Appellate Tribunal and Members of the Appellate Tribunal shall be such as may
be prescribed by the Central Government :
Provided that neither the salary and allowances nor the other terms and conditions of service of the
Chairperson of the Appellate Tribunal or a Member of the Appellate Tribunal shall be varied to his
disadvantage after appointment.
Vacancies.
116.
If, for reason other than temporary absence, any vacancy occurs in the office of the Chairperson of
the Appellate Tribunal or a Member of the Appellate Tribunal, the Central Government shall appoint
another person in accordance with the provisions of this Act to fill the vacancy and the proceedings
may be continued before the Appellate Tribunal from the stage at which the vacancy is filled.
Resignation and removal
117.
1. The Chairperson of the Appellate Tribunal or a Member of the Appellate Tribunal may, by
notice in writing under his hand addressed to the Central Government, resign his office:
Provided that the Chairperson of the Appellate Tribunal or a Member of the Appellate
Tribunal shall, unless he is permitted by the Central Government to relinquish his office
sooner, continue to hold office until the expiry of three months from the date of receipt of
such notice or until a person duly appointed as his successor enters upon his office or until
the expiry of term of office, whichever is the earliest.
2. The Chairperson of the Appellate Tribunal or a Member of the Appellate Tribunal shall not
be removed from his office except by an order by the Central Government on the ground of
proved misbehaviour or incapacity after an inquiry made by a judge of the Supreme Court as
the Central Government may appoint for this purpose in which the Chairperson or a Member
of the Appellate Tribunal concerned has been informed of the charges against him and given
a reasonable opportunity of being heard in respect of such charges.
Member to act as Chairperson in certain circumstances.
118.
1. In the event of the occurrence of any vacancy in the office of the Chairperson of the
Appellate Tribunal by reason of his death, resignation or otherwise, the senior-most Member
101
of the Appellate Tribunal shall act as the Chairperson of the Appellate Tribunal until the date
on which a new Chairperson, appointed in accordance with the provisions of this Act to fill
such vacancy, enters upon his office.
2. When the Chairperson of the Appellate Tribunal is unable to discharge his functions owing
to absence, illness or any other cause, the seniormost Member of the Appellate Tribunal shall
discharge the functions of the Chairperson of the Appellate Tribunal until the date on which
the Chairperson of the Appellate Tribunal resumes his duties.
Officers and other employees of Appellate Tribunal..
119.
1. The Central Government shall provide the Appellate Tribunal with such officers and other
employees as it may deem fit.
2. The officers and other employees of the Appellate Tribunal shall discharge their functions
under the general superintendence of the Chairperson of the Appellate Tribunal.
3. The salaries and allowances and other terms and conditions of service of the officers and
other employees of the Appellate Tribunal shall be such as may be prescribed by the Central
Government.
Procedure and powers of Appellate Tribunal.
120
1. The Appellate Tribunal shall not be bound by the procedure laid down by the Code of Civil
Procedure, 1908, but shall be guided by the principles of natural justice and, subject to the
other provisions of this Act, the Appellate Tribunal shall have powers to regulate its own
procedure. 5 of 1908
2. The Appellate Tribunal shall have, for the purposes of 5 of 1908discharging its functions
under this Act, the same powers as are vested in a civil court under the Code of Civil
Procedure, 1908, while trying a suit, in respect of the following matters, namely:a. summoning and enforcing the attendance of any person and examining him on oath;
b. requiring the discovery and production of documents;
c. receiving evidence on affidavits;
d. subject to the provisions of sections 123 and 124 of the Indian Evidence Act, 1872,
requisitioning any public record or document or 1 of 1872 copy of such record or
document from any office;
e. issuing commissions for the examination of witnesses or documents;
f. reviewing its decisions;
102
g. dismissing a representation of default or deciding it ex parte;
h. setting aside any order of dismissal or any representation for default or any order
passed by it ex parte;
i. any other matter which may be prescribed by the Central Government. 5 of 1908 1 of
1872 45 of 1860.
3. An order made by the Appellate Tribunal under this Act shall be executable by the Appellate
Tribunal as a decree of civil court and, for this purpose, the Appellate Tribunal shall have all
the powers of a civil court.
4. Notwithstanding anything contained in sub-section (3), the Appellate Tribunal may transmit
any order made by it to a civil court having local jurisdiction and such civil court shall
execute the order as if it were a decree made by that court.
45 of 1860.
5. All proceedings before the Appellate Tribunal shall be deemed to be judicial proceedings
within the meaning of sections 193 and 228 of the Indian of 1974. Penal Code and the
Appellate Tribunal shall be deemed to be a civil court for the purposes of section 345 and
346 of the Code of Criminal Procedure, 1973 .2 of 1974.
Power of Chairperson of Appellate Tribunal
121.
The Chairperson of the Appellate Tribunal shall exercise general power of super-intendance and
control over the Appropriate Commission.
Distribution of business amongst Benches and transfer of cases from one Bench to another
Bench.
122.
1. Where Benches are constituted, the Chairperson of the Appellate Tribunal may, from time to
time, by notification, make provisions as to the distribution of the business of the Appellate
Tribunal amongst the Benches and also provide for the matters which may be dealt with by
each Bench.
2. On the application of any of the parties and after notice to the parties, and after hearing such
of them as he may desire to be heard, or on his own motion without such notice, the
Chairperson of the Appellate Tribunal may transfer any case pending before one Bench, for
disposal, to any other Bench.
Decision to be by majority.
123.
103
If the Members of the Appellate Tribunal of a Bench consisting of two Members differ in opinion on
any point, they shall state the point or points on which they differ, and make a reference to the
Chairperson of the Appellate Tribunal who shall either hear the point or points himself or refer the
case for hearing on such point or points by one or more of the other Members of the Appellate
Tribunal and such point or points shall be decided according to the opinion of the majority of the
Members of the Appellate Tribunal who have heard the case, including those who first heard it.
Right of appellant to take assistance of legal practitioner and of Appropriate Commission to
appoint presenting officers.
124.
1. A person preferring an appeal to the Appellate Tribunal under this Act may either appear in
person or take the assistance of a legal practitioner of his choice to present his case before the
Appellate Tribunal, as the case may be.
2. The Appropriate Commission may authorise one or more legal practitioners or any of its
officers to act as presenting officers and every person so authorised may present the case
with respect to any appeal before the Appellate Tribunal, as the case may be.
Appeal to Supreme Court.
125.
Any person aggrieved by any decision or order of the Appellate Tribunal, may, file an appeal to the
Supreme Court within sixty days from the date of communication of the decision or order of the
Appellate Tribunal, to him, on any one or more of the grounds specified in section 100 of the Code
of Civil Procedure,1908:
Provided that the Supreme Court may, if it is satisfied that the appellant was prevented by sufficient
cause from filing the appeal within the said period, allow it to be filed within a further period not
exceeding sixty days.
104
PART – X11
Investigation And Enforcement
Assessment.
126.
1. If on an inspection of any place or premises or after inspection of the equipments, gadgets,
machines, devices found connected or used, or after inspection of records maintained by any
person, the assessing officer comes to the conclusion that such person is indulging in
unauthorized use of electricity, he shall provisionally assess to the best of his judgement the
electricity charges payable by such person or by any other person benefited by such use.
2. The order of provisional assessment shall be served upon the person in occupation or
possession or in charge of the place or premises in such manner as may be prescribed.
3. The person, on whom a notice has been served under subsection (2) shall be entitled to file
objections, if any, against the provisional assessment before the assessing officer, who may,
after affording a reasonable opportunity of hearing to such person, pass a final order of
assessment of the electricity charges payable by such person.
4. Any person served with the order of provisional assessment, may, accept such assessment
and deposit the assessed amount with the licensee within seven days of service of such
provisional assessment order upon him: Provided that in case the person deposits the
assessed amount he shall not be subjected to any further liability or any action by any
authority whatsoever.
5. If the assessing officer reaches to the conclusion that unauthorised use of electricity has
taken place, it shall be presumed that such unauthorized use of electricity was continuing for
a period of three months immediately preceding the date of inspection in case of domestic
and agricultural services and for a period of six months immediately preceding the date of
inspection for all other categories of services, unless the onus is rebutted by the person,
occupier or possessor of such premises or place.
6. The assessment under this section shall be made at a rate equal to one-and-half times the
tariff rates applicable for the relevant category of services specified in sub-section (5).
Explanation.- For the purposes of this section,
a. “ assessing officer” means an officer of a State Government or Board or licensee, as
the case may be, designated as such by the State Government ;
b. “ unauthorised use of electricity” means the usage of electricity –
105
i.
by any artificial means; or
ii.
by a means not authorised by the concerned person or authority or licensee; or
iii.
through a tampered meter; or
iv.
for the purpose other than for which the usage of electricity was authorised.
Appeal to Appellate Authority.
127.
1. Any person aggrieved by a final order made under section 126 may, within thirty days of the
said order, prefer an appeal in such form, verified in such manner and be accompanied by
such fee as may be specified by the State Commission, to an appellate authority as may be
prescribed.
2. No appeal against an order of assessment under sub-section (1) shall be entertained unless an
amount equal to one third of the assessed amount is deposited in cash or by way of bank
draft with the licensee and documentary evidence of such deposit has been enclosed along
with the appeal.
3. The appellate authority referred to in sub-section (1) shall dispose of the appeal after hearing
the parties and pass appropriate order and send copy of the order to the assessing officer and
the appellant.
4. The order of the appellate authority referred to in sub-section (1) passed under sub-section
(3) shall be final.
5. No appeal shall lie to the appellate authority referred to in subsection (1) against the final
order made with the consent of the parties.
6. When a person default in making payment of assessed amount, he, in addition to the assessed
amount shall be liable to pay, on the expiry of thirty days from the date of order of
assessment, an amount of interest at the rate of sixteen per cent per annum compounded
every six months.
Investigation of certain matters
128.
1. The Appropriate Commission may, on being satisfied that a licensee has failed to comply
with any of the conditions of licence or a generating company or a licensee has failed to
comply with any of the provisions of this Act or rules or regulations made thereunder, at any
time, by order in writing, direct any person (hereafter in this section referred to as “
Investigating Authority” ) specified in the order to investigate the affairs of any generating
company or licensee and to report to that Commission on any investigation made by such
106
Investigating Authority: Provided that the Investigating Authority may, wherever necessary,
employ any auditor or any other person for the purpose of assisting him in any investigation
under this section.
2. Notwithstanding anything to the contrary contained in section 235 of the Companies Act,
1956, the Investigating Authority may, at any time, and shall, on being directed so to do by
the Appropriate Commission, cause an inspection to be made, by one or more of his officers,
of any licensee or generating company and his books of account; and the Investigating
Authority shall supply to the licensee or generating company, as the case may be, a copy of
his report on such inspection.
3. It shall be the duty of every manager, managing director or other officer of the licensee or
generating company, as the case may be, to produce before the Investigating Authority
directed to make the investigation under subsection (1), or inspection under sub-section (2),
all such books of account, registers and other documents in his custody or power and to
furnish him with any statement and information relating to the affairs of the licensee or
generating company, as the case may be, as the said Investigating Authority may require of
him within such time as the said Investigating Authority may specify.
4. Any Investigating Authority, directed to make an investigation under sub-section (1), or
inspection under sub-section (2), may examine on oath any manager, managing director or
other officer of the licensee or generating company, as the case may be, in relation to his
business and may administer oaths accordingly.
5. The Investigating Authority, shall, if it has been directed by the Appropriate Commission to
cause an inspection to be made, and may, in any other case, report to the Appropriate
Commission on any inspection made under this section.
6. On receipt of any report under sub-section (1) or sub-section (5), the Appropriate
Commission may, after giving such opportunity to the licensee or generating company, as the
case may be, to make a representation in connection with the report as in the opinion of the
Appropriate Commission, seems reasonable, by order in writing—
a. require the licensee or the generating company to take such action in respect of any
matter arising out of the report as the Appropriate Commission may think fit; or
b. cancel the licenece; or
c. direct the generating company to cease to carry on the business of generation of
electricity.
107
7. The Appropriate Commission may, after giving reasonable notice to the licensee or the
generating company, as the case may be, publish the report submitted by the Investigating
Authority under sub-section (5) or such portion thereof as may appear to it to be necessary.
8. The Appropriate Commission may specify the minimum information to be maintained by the
licensee or the generating company in their books, the manner in which such information
shall be maintained, the checks and other verifications to be adopted by licensee or the
generating company in that connection and all other matters incidental thereto as are, in its
opinion, necessary to enable the Investigating Authority to discharge satisfactorily its
functions
under
this
section.
Explanation.- For the purposes of this section, the expression “ licensee or the generating
company” shall include in the case of a licensee incorporated in India—
a. all its subsidiaries formed for the purpose of carrying on the business of generation or
transmission or distribution or trading of electricity exclusively outside India; and
b. all its branches whether situated in India or outside India.
9. All expenses of, and incidental to, any investigation made under this section shall be
defrayed by the licensee or generating company, as the case may be, and shall have priority
over that debts due from the licensee or the generating company and shall be recoverable as
an arrear of land revenue.
Orders for securing compliance
129.
1. Where the Appropriate Commission, on the basis of material in its possession, is satisfied
that a licensee is contravening, or is likely to contravene, any of the conditions mentioned in
his licence or conditions for grant of exemption or the licensee or the generating company
has contravened or is likely to contravene any of the provisions of this Act, it shall, by an
order, give such directions as may be necessary for the purpose of securing compliance with
that condition or provision.
2. While giving direction under sub-section (1), the Appropriate Commission shall have due
regard to the extent to which any person is likely to sustain loss or damage due to such
contravention.
Procedure for issuing directions by Appropriate Commission.
130.
The Appropriate Commission, before issuing any direction under section 129, shall-a. serve notice in the manner as may be specified to the concerned licensee or generating
company;
108
b. publish the notice in the manner as may be specified for the purpose of bringing the matters
to the attention of persons, likely to be affected,or affected;
c. Consider suggestions and objections from the concerned licensee or generating company and
the persons, likely to be affected, or affected.
109
PART – X111
Reorganisation Of Board
Vesting of property of Board in State Government.
131.
1. With effect from the date on which a transfer scheme, prepared by the State Government to
give effect to the objects and purposes of this Act, is published or such further date as may be
stipulated by the State Government (hereafter in this Part referred to as the effective date),
any property, interest in property, rights and liabilities which immediately before the
effective date belonged to the State Electricity Board (hereafter referred to as the Board)
shall vest in the State Government on such terms as may be agreed between the State
Government and the Board.
2. Any property, interest in property, rights and liabilities vested in the State Government under
sub-section (1) shall be re-vested by the State Government in a Government company or in a
company or companies, in accordance with the transfer scheme so published along with such
other property, interest in property, rights and liabilities of the State Government as may be
stipulated in such scheme, on such terms and conditions as may be agreed between the State
Government and such company or companies being State Transmission Utility or generating
company or transmission licensee or distribution licensee, as the case may be : Provided that
the transfer value of any assets transferred hereunder shall be determined, as far as may be,
based on the revenue potential of such assets at such terms and conditions as may be agreed
between the State Government and the State Transmission Utility or generating company or
transmission licensee or distribution licensee, as the case may be.
3. Notwithstanding anything contained in this section, where,a. the transfer scheme involves the transfer of any property or rights to any person or
undertaking not wholly owned by the State Government, the scheme shall give effect
to the transfer only for fair value to be paid by the transferee to the State
Government;
b. a transaction of any description is effected in pursuance of a transfer scheme, it shall
be binding on all persons including third parties and even if such persons or third
parties have not consented to it.
4. The State Government may, after consulting the Government company or company or
companies being State Transmission Utility or generating company or transmission licensee
or distribution licensee, referred to in sub-section (2) (hereinafter referred to as the
transferor), require such transferor to draw up a transfer scheme to vest in a transferee being
110
any other generating company or transmission licensee or distribution licensee, the property,
interest in property, rights and liabilities which have been vested in the transferor under this
section, and publish such scheme as statutory transfer scheme under this Act.
5. A transfer scheme under this section maya. provide for the formation of subsidiaries, joint venture companies or other schemes of
division, amalgamation, merger, reconstruction or arrangements which shall promote
the profitability and viability of the resulting entity, ensure economic efficiency,
encourage competition and protect consumer interests;
b. define the property, interest in property, rights and liabilities to be allocated i.
by specifying or describing the property, rights and liabilities in question; or
ii.
by referring to all the property, interest in property, rights and liabilities
comprised in a described part of the transferor’s undertaking; or
iii.
partly in one way and partly in the other;
c. provide that any rights or liabilities stipulated or described in the scheme shall be
enforceable by or against the transferor or the transferee;
d. impose on the transferor an obligation to enter into such written agreements with or
execute such other instruments in favour of any other subsequent transferee as may
be stipulated in the scheme;
e. mention the functions and duties of the transferee;
f. make such supplemental, incidental and consequential provisions as the transferor
considers appropriate including provision stipulating the order as taking effect; and
g. provide that the transfer shall be provisional for a stipulated period.
6. All debts and obligations incurred, all contracts entered into and all matters and things
engaged to be done by the Board, with the Board or for the Board, or the State Transmission
Utility or generating company or transmission licensee or distribution licensee, before a
transfer scheme becomes effective shall, to the extent specified in the relevant transfer
scheme, be deemed to have been incurred, entered into or done by the Board, with the Board
or for the State Government or the transferee and all suits or other legal proceedings
instituted by or against the Board or transferor, as the case may be, may be continued or
instituted by or against the State Government or concerned transferee, as the case may be.
111
7. The Board shall cease to be charged with and shall not perform the functions and duties with
regard to transfers made on and after the effective date. Explanation.- For the purpose of this
Part, a. "Government company" means a Government Company formed and registered under
the
Companies
Act,
1956.
1 of 1956
b. "company" means a company to be formed and registered under the Companies Act,
1956 to undertake generation or transmission or distribution in accordance with the
scheme under this Part. 1 of 1956 1 of 1956
Use of proceeds of sale or transfer of the Board etc.
132.
In the event that a Board or any utility owned or controlled by the Appropriate Government is sold
or transferred in any manner to a person who is not owned or controlled by the Appropriate
Government, the proceeds from such sale or transfer shall be utilised in priority to all other dues in
the following order, namely :a. dues (including retirement benefits due) to the officers and employees of such Board or
utility, who have been affected by the aforesaid sale or transfer;
b. payment of debt or other liabilities of the transferor as may be required by the existing loan
covenants.
Provisions relating to officers and employees.
133.
1. The State Government may, by a transfer scheme, provide for the transfer of the officers and
employees to the transferee on the vesting of properties, rights and liabilities in such
transferee as provided under section 131.
2. Upon such transfer under the transfer scheme, the personnel shall hold office or service
under the transferee on such terms and conditions as may be determined in accordance with
the transfer scheme: Provided that such terms and conditions on the transfer shall not in any
way be less favourable than those which would have been applicable to them if there had
been no such transfer under the transfer scheme:
Provided further that the transfer can be provisional for a stipulated period.
Explanation: - For the purposes of this section and the transfer scheme, the expression
112
"officers and employees" shall mean all officers and employees who on the date specified in
the scheme are the officers and employees of the Board or transferor, as the case may be.
Payment of compensation or damages on transfer.
134.
Notwithstanding anything contained in the Industrial Disputes Act, 1947 or any other law for the
time being in force and except for the provisions made in this Act, the transfer of the employment of
the officers and employees referred to in sub-section (1) of section 133 shall not entitle such officers
and employees to any compensation or damages under this Act, or any other Central or State law,
save as provided in the transfer scheme. 14 of 1947
113
PART – XIV
Offences And Penalties
Theft of Electricity.
135.
1. Whoever, dishonestly, -a. taps, makes or causes to be made any connection with overhead, underground or
under water lines or cables, or service wires, or service facilities of a licensee; or
b. tampers a meter, installs or uses a tampered meter, current reversing transformer,
loop connection or any other device or method which interferes with accurate or
proper registration, calibration or metering of electric current or otherwise results in a
manner whereby electricity is stolen or wasted; or
c. damages or destroys an electric meter, apparatus, equipment, or wire or causes or
allows any of them to be so damaged or destroyed as to interfere with the proper or
accurate metering of electricity, so as to abstract or consume or use electricity shall
be punishable with imprisonment for a term which may extend to three years or with
fine or with both: Provided that in a case where the load abstracted, consumed, or
used or attempted abstraction or attempted consumption or attempted use i.
ii.
does not exceed 10 kilowatt, the fine imposed on first conviction shall not be
less than three times the financial gain on account of such theft of electricity
and in the event of second or subsequent conviction the fine imposed shall not
be less than six times the financial gain on account of such theft of electricity;
2 of 1974
exceeds 10 kilowatt, the fine imposed on first conviction shall not be less than
three times the financial gain on account of such theft of electricity and in the
event of second or subsequent conviction, the sentence shall be imprisonment
for a term not less than six months but which may extend to five years and
with fine not less than six times the financial gain on account of such theft of
electricity: Provided further that if it is proved that any artificial means or
means not authorized by the Board or licensee exist for the abstraction,
consumption or use of electricity by the consumer, it shall be presumed, until
the contrary is proved, that any abstraction, consumption or use of electricity
has been dishonestly caused by such consumer.
2. Any officer authorized in this behalf by the State Government may - 114
a. enter, inspect, break open and search any place or premises in which he has reason to
believe that electricity has been, is being, or is likely to be, used unauthorisedly;
b. search, seize and remove all such devices, instruments, wires and any other facilitator
or article which has been, is being, or is likely to be, used for unauthorized use of
electricity;
c. examine or seize any books of account or documents which in his opinion shall be
useful for or relevant to, any proceedings in respect of the offence under sub-section
(1) and allow the person from whose custody such books of account or documents are
seized to make copies thereof or take extracts therefrom in his presence.
3. The occupant of the place of search or any person on his behalf shall remain present during
the search and a list of all things seized in the course of such search shall be prepared and
delivered to such occupant or person who shall sign the list: Provided that no inspection,
search and seizure of any domestic places or domestic premises shall be carried out between
sunset and sunrise except in the presence of an adult male member occupying such premises.
2 of 1974
4. The provisions of the Code of Criminal Procedure, 1973, relating to search and seizure shall
apply, as far as may be, to searches and seizure under this Act.
Theft of electric lines and materials.
136.
1. Whoever, dishonestly -a. cuts or removes or takes way or transfers any electric line, material or meter from a
tower, pole, any other installation or place of installation or any other place, or site
where it may be rightfully or lawfully stored, deposited, kept, stocked, situated or
located including during transportation, without the consent of the licensee or the
owner, as the case may be, whether or not the act is done for profit or gain; or
b. stores, possesses or otherwise keeps in his premises, custody or control, any electric
line, material or meter without the consent of the owner, whether or not the act is
committed for profit or gain; or
c. loads, carries, or moves from one place to another any electric line, material or meter
without the consent of its owner, whether or not the act is done for profit or gain,done
for profit or gain, is said to have committed an offence of theft of electric lines and
materials, and shall be punishable with imprisonment for a term which may extend to
three years or with fine or with both.
115
2. If a person, having been convicted of an offence punishable under sub-section (1) is again
guilty of an offence punishable under that subsection, he shall be punishable for the second
or subsequent offence for a term of imprisonment which shall not be less than six months but
which may extend to five years and shall also be liable to fine which shall not be less than
ten thousand rupees.
Punishment for receiving stolen property
137.
Whoever, dishonestly receives any stolen electric lines or materials knowing or having reasons to
believe the same to be stolen property, shall be punishable with imprisonment of either description
for a term which may extend to three years or with fine or with both.
Interference with meters or works of licensee.
138.
1. (1) Whoever, a. unauthorisedly connects any meter, indicator or apparatus with any electric line
through which electricity is supplied by a licensee or disconnects the same from any
such electric line; or
b. unauthorisedly reconnects any meter, indicator or apparatus with any electric line or
other works being the property of a licensee when the said electric line or other works
has or have been cut or disconnected; or
c. lays or causes to be laid, or connects up any works for the purpose of communicating
with any other works belonging to a licensee; or
d. maliciously injures any meter, indicator, or apparatus belonging to a licensee or
willfully or fraudulently alters the index of any such meter, indicator or apparatus or
prevents any such meter, indicator or apparatus from duly registering, shall be
punishable with imprisonment for a term which may extend to three years, or with
fine which may extend to ten thousand rupees, or with both, and , in the case of a
continuing offence, with a daily fine which may extend to five hundred rupees; and if
it is proved that any means exist for making such connection as is referred to in
clause (a) or such re-connection as is referred to in clause (b), or such communication
as is referred to in clause (c), for causing such alteration or prevention as is referred
to in clause (d), and that the meter, indicator or apparatus is under the custody or
control of the consumer, whether it is his property or not, it shall be presumed, until
the contrary is proved, that such connection, reconnection, communication, alteration,
prevention or improper use, as the case may be, has been knowingly and willfully
caused by such consumer.
116
Negligently wasting electricity or injuring works.
139.
Whoever, negligently causes electricity to be wasted or diverted or negligently breaks, injures,
throws down or damages any material connected with the supply of electricity, shall be punishable
with fine which may extend to ten thousand rupees.
Penalty for maliciously wasting electricity or injuring works.
140.
Whoever, maliciously causes electricity to be wasted or diverted, or , with intent to cut off the
supply of electricity, cuts or injures, or attempts to cut or injure, any electric supply line or works,
shall be punishable with fine which may extend to ten thousand rupees.
Extinguishing public lamps.
141.
Whoever, maliciously extinguishes any public lamp shall be punishable with fine which may be
extend to two thousand rupees.
Punishment for non-compliance of directions by Appropriate Commission.
142.
In case any complaint is filed before the Appropriate Commission by any person or if that
Commission is satisfied that any person has contravened any provisions of this Act or rules or
regulations made thereunder, or any direction issued by the Commission, the Appropriate
Commission may after giving such person an opportunity of being heard in the matter, by order in
writing, direct that, without prejudice to any other penalty to which he may be liable under this Act,
such person shall pay, by way of penalty, which shall not exceed one lakh rupees for each
contravention and in case of a continuing failure with an additional penalty which may extend to six
thousand rupees for every day during which the failure continues after contravention of the first such
direction.
Power to adjudicate.
143.
1. For the purpose of adjudging under this Act, the Appropriate Commission shall appoint any
of its Members to be an adjudicating officer for holding an inquiry in such manner as may be
prescribed by the Appropriate Government ,after giving any person concerned a reasonable
opportunity of being heard for the purpose of imposing any penalty.
2. While holding an inquiry, the adjudicating officer shall have power to summon and enforce
the attendance of any person acquainted with the facts and circumstances of the case to give
evidence or produce any document which in the opinion of the adjudicating officer, may be
useful for or relevant to the subject-matter of the inquiry, and if, on such inquiry, he is
satisfied that the person has failed to comply with the provisions of section 29 or section 33
117
or section 43, he may impose such penalty as he thinks fit in accordance with the provisions
of any of those sections.
Factors to be taken into account by adjudicating officer.
144.
While adjudicating the quantum of penalty under section 29 or section 33 or section 43, the
adjudicating officer shall have due regard to the following factors, namely:a. the amount of disproportionate gain or unfair advantage, wherever quantifiable, made as a
result of the default;
b. the repetitive nature of the default.
Civil court not to have jurisdiction
145.
No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter
which an assessing officer referred to in section 126 or an appellate authority referred to in section
127 or the adjudicating officer appointed under this Act is empowered by or under this Act to
determine and no injunction shall be granted by any court or other authority in respect of any action
taken or to be taken in pursuance of any power conferred by or under this Act.
Punishment for non-compliance of orders or directions.
146.
Whoever, fails to comply with any order or direction given under this Act, within such time as may
be specified in the said order or direction or contravenes or attempts or abets the contravention of
any of the provisions of this Act or any rules or regulations made thereunder, shall be punishable
with imprisonment for a term which may extend to three months or with fine, which may extend to
one lakh rupees, or with both in respect of each offence and in the case of a continuing failure, with
an additional fine which may extend to five thousand rupees for every day during which the failure
continues after conviction of the first such offence.
Penalties not to affect other liabilities.
147.
The penalties imposed under this Act shall be in addition to, and not in derogation of, any liability in
respect of payment of compensation or, in the case of a licensee, the revocation of his licence which
the offender may have incurred.
Penalty where works belong to Government.
148.
118
The provisions of this Act shall, so far as they are applicable, be deemed to apply also when the acts
made punishable thereunder are committed in the case of electricity supplied by or of works
belonging to the Appropriate Government.
Offences by companies.
149.
1. Where an offence under this Act has been committed by a company, every person who at the
time the offence was committed was in charge of and was responsible to the company for the
conduct of the business of the company, as well as the company shall be deemed to be guilty
of having committed the offence and shall be liable to be proceeded against and punished
accordingly: Provided that nothing contained in this sub-section shall render any such person
liable to any punishment if he proves that the offence was committed without his knowledge
or that he had exercised all due diligence to prevent the commission of such offence.
2. Notwithstanding anything contained in sub-section (1), where an offence under this Act has
been committed by a company and it is proved that the offence has been committed with the
consent or connivance of or is attributable to any neglect on the part of any director,
manager, secretary or other officer of the company, such director, manager, secretary or
other officer shall also be deemed to be guilty of having committed such offence and shall be
liable
to
be
proceeded
against
and
punished
accordingly.
Explanation. - For the purpose of this section,a. "company" means a body corporate and includes a firm or other association of
individuals; and
b. "director", in relation to a firm, means a partner in the firm.
Abatement.
150.
45 of 1860.
1. Whoever abets an offence punishable under this Act, shall, notwithstanding anything
contained in the Indian Penal Code, be punished with the punishment provided for the
offence.
2. Without prejudice to any penalty or fine which may be imposed or prosecution proceeding
which may be initiated under Act or any other law for the time being in force, if any officer
or other employee of the Board or the licensee enters intro or acquiesces in any agreement to
do, abstains from doing, permits, conceals or connives at any act or thing whereby any theft
of electricity is committed, he shall be punishable with imprisonment for a term which may
extend to three years, or with fine, or with both.
Cognizance of offences.
151.
119
No court shall take cognizance of an offence punishable under this Act except upon a complaint in
writing made by Appropriate Government or Appropriate Commission or any of their officer
authorized by them or a Chief Electrical Inspector or an Electrical Inspector or licensee or the
generating company, as the case may be, for this purpose.
Compounding of offences.
152.
2 of 1974.
1. Notwithstanding anything contained in the Code of Criminal Procedure 1973, the
Appropriate Government or any officer authorized by it in this behalf may accept from any
consumer or person who committed or who is reasonably suspected of having committed an
offence of theft of electricity punishable under this Act, a sum of money by way of
compounding of the offence as specified in the Table below:
TABLE
Rate at which the sum of money for
Compounding to be collected per
Kilowatt(KW)/Horse Power(HP) or part
Nature of Service
thereof for Low Tension (LT) supply and
per Kilo Volt Ampere(KVA) of
contracted
demand for High Tension (HT)
1
2
1. Industrial Service
twenty thousand rupees;
2. Commercial Service
ten thousand rupees;
3. Agricultural Service
two thousand rupees;
4. Other Services
four thousand rupees:
2. Provided that the Appropriate Government may, by notification in the Official Gazette,
amend the rates specified in the Table above.
3. On payment of the sum of money in accordance with sub-section (1), any person in custody
in connection with that offence shall be set at liberty and no proceedings shall be instituted or
continued against such consumer or person in any criminal court.
4. The acceptance of the sum of money for compounding an offence in accordance with subsection (1) by the Appropriate Government or an officer authorised in this behalf empowered
in this behalf shall be deemed to amount to an acquittal within the meaning of section 300 of
the Code of Criminal Procedure, 1973.
5. The Compounding of an offence under sub-section (1) shall be allowed only once for any
person or consumer.
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PART – XV
Special Courts
Constitution of Special Courts.
153.
1. The State Government may, for the purposes of providing speedy trial of offences referred to
in sections 135 to 139, by notification in the Official Gazette, constitute as many Special
Courts as may be necessary for such area or areas, as may be specified in the notification.
2. A Special Court shall consist of a single Judge who shall be appointed by the State
Government with the concurrence of the High Court.
3. A person shall not be qualified for appointment as a Judge of a Special Court unless he was,
immediately before such appointment, an Additional District and Sessions Judge.
4. Where the office of the Judge of a Special Court is vacant, or such Judge is absent from the
ordinary place of sitting of such Special Court, or he is incapacitated by illness or otherwise
for the performance of his duties, any urgent business in the Special Court shall be disposed
of –
a. by a Judge, if any, exercising jurisdiction in the Special Court;
b. where there is no such other Judge available, in accordance with the direction of
District and Sessions Judge having jurisdiction over the ordinary place of sitting of
Special Court, as notified under sub- section(1).
Procedure and power of Special Court.
154.
1. otwithstanding anything contained in the Code of Criminal Procedure, 1973, every offence
punishable under sections 135 to 139 shall be triable only by the Special Court within whose
jurisdiction such offence has been committed.
2. Where it appears to any court in the course of any inquiry or trial that an offence punishable
under sections 135 to 139 in respect of any offence that the case is one which is triable by a
Special Court constituted under this Act for the area in which such case has arisen, it shall
transfer such case to such Special Court, and thereupon such case shall be tried and disposed
of by such Special Court in accordance with the provisions of this Act : Provided that it shall
be lawful for such Special Court to act on the evidence, if any, recorded by any court in the
case of presence of the accused before the transfer of the case to any Special Court :
Provided further that if such Special Court is of opinion that further examination, crossexamination and re-examination of any of the witnesses whose evidence has already been
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recorded, is required in the interest of justice, it may resummon any such witness and after
such further examination, cross-examination or re-examination, if any, as it may permit, the
witness shall be discharged.
3. The Special Court may, notwithstanding anything contained in subsection (1) of section 260
or section 262 of the Code of Criminal Procedure, 1973, try the offence referred to in
sections 135 to 139 in a summary way in accordance with the procedure prescribed in the
said Code and the provisions of sections 263 to 265 of the said Code shall, so far as may be,
apply to such trial : Provided that where in the course of a summary trial under this
subsection, it appears to the Special Court that the nature of the case is such that it is
undesirable to try such case in summary way, the Special Court shall recall any witness who
may have been examined and proceed to re-hear the case in the manner provided by the
provisions of the said Code for the trial of such offence: Provided further that in the case of
any conviction in a summary trial under this section, it shall be lawful for a Special Court to
pass a sentence of imprisonment for a term not exceeding five years.
4. A Special Court may, with a view to obtaining the evidence of any person supposed to have
been directly or indirectly concerned in or privy to, any offence tender pardon to such person
on condition of his making a full and true disclosure of the circumstances within his
knowledge relating to the offence and to every other person concerned whether as principal
or abettor in the commission thereof, and any pardon so tendered shall , for the purposes of
section 308 of the Code of Criminal Procedure,1973, be deemed to have been tendered under
section 307 thereof.
5. The Special Court may determine the civil liability against a consumer or a person in terms
of money for theft of energy which shall not be less than an amount equivalent to two times
of the tariff rate applicable for a period of twelve months preceding the date of detection of
theft of energy or the exact period of theft if determined which ever is less and the amount of
civil liability so determined shall be recovered as if it were a decree of civil court.
6. In case the civil liability so determined finally by the Special Court is less than the amount
deposited by the consumer or the person, the excess amount so deposited by the consumer or
the person, to the Board or licensee or the concerned person, as the case may be, shall be
refunded by the Board or licensee or the concerned person, as the case may be, within a
fortnight from the date of communication of the order of the Special Court together with
interest at the prevailing Reserve Bank of India prime lending rate for the period from the
date of such deposit till the date of payment. 2 of 1974
Explanation
. - For the purposes of this section, “ civil liability” means loss or damage incurred by the Board or
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licensee or the concerned person, as the case may be, due to the commission of an offence referred
to in sections 135 to 139. 2 of 1974.
155.
Save as otherwise provided in this Act, the Code of Criminal Procedure, 1973, in so far as they are
not inconsistent with the provisions of this Act, shall apply to the proceedings before the Special
Court and for the purpose of the provisions of the said enactments, the Special Court shall be
deemed to be a Court of Session and shall have all powers of a Court of Session and the person
conducting a prosecution before the Special Court shall be deemed to be a Public Prosecutor.
Special Court to have powers of court of session 2 of 1974.
156.
The High Court may exercise, so far as may be applicable, all the powers conferred by Chapters
XXIX and XXX of the Code of Criminal Procedure, 1973, as if the Special Court within the local
limits of the jurisdiction of the High Court is a District Court, or as the case may be , the Court of
Session , trying cases within the local limits of jurisdiction of the High Court. Appeal and revision.
157.
The Special Court may , on a petition or otherwise and in order to prevent miscarriage of justice,
review its judgment or order passed under section 154, but no such review petition shall be
entertained except on the ground that it was such order passed under a mistake of fact, ignorance of
any material fact or any error apparent on the face of the record : Provided that the Special Court
shall not allow any review petition and set aside its previous order or judgment without hearing the
parties affected. Explanation.- For the purpose of this Part, "Special Courts" means the Special
Courts constituted under sub-section (1) of section 153.
Review.
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PART XVI
Dispute Resolution
Arbitration
Arbitration.
158.
Where any matter is, by or under this Act, directed to be determined by arbitration, the matter shall,
unless it is otherwise expressly provided in the licence of a licensee, be determined by such person
or persons as the Appropriate Commission may nominate in that behalf on the application of either
party; but in all other respects the arbitration shall be subject to the provisions of the Arbitration and
Conciliation Act, 1996.
26 of 1996.
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PART XVII
OTHER PROVISION
Protective clauses
Protection of railways, highways, airports and canals, docks, wharfs and piers.
159.
No person shall, in the generation, transmission, distribution, supply or use of electricity, in any way
injure any railway, highway, airports, tramway, canal or water-way or any dock, wharf or pier
vested in or controlled by a local authority, or obstruct or interfere with the traffic on any railway,
airway, tramway, canal or water-way.
Protection of telegraphic, telephonic and electric signalling lines.
160.
1. Every person generating, transmitting, distributing, supplying or using electricity (hereinafter
in this section referred to as the "operator") shall take all reasonable precautions in
constructing, laying down and placing his electric lines, electrical plant and other works and
in working his system, so as not lines, electrical plant and other works and in working his
system, so as not injuriously to affect, whether by induction or otherwise, the working of any
wire or line used for the purpose of telegraphic, telephone or electric signalling
communication, or the currents in such wire or line.
2. Where any difference or dispute arises between the operator, and the telegraph authority as to
whether the operator has constructed, laid down or placed his electric lines, electrical plant or
other works, or worked his system, in contravention of sub-section (1), or as to whether the
working of any wire, line or current is or is not injuriously affected thereby, the matter shall
be referred to the Central Government and the Central Government, unless it is of opinion
that the wire or line has been placed in unreasonable proximity to the electric lines, electrical
plant or works of the operator after the construction of such lines, plant or works, may direct
the operator to make such alterations in, or additions to, his system as may be necessary in
order to comply with the provisions of this section, and the operator shall make such
alterations or additions accordingly: Provided that nothing in this sub-section shall apply to
the repair, renewal or amendment of any electric line or electrical plant so long as the course
of the electric line or electrical plant and the amount and nature of the electricity transmitted
thereby are not altered.
3. Where the operator makes default in complying with the requirements of this section, he
shall make full compensation for any loss or damage incurred by reason thereof, and, where
any difference or dispute arises as to the amount of such compensation, the matter shall be
determined
by
arbitration.
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Explanation.
For the purposes of this section, a telegraph line shall be deemed to be injuriously affected if
telegraphic, telephonic or electric signalling communication by means of such line is,
whether through induction or otherwise, prejudicially interfered with by an electric line ,
electrical plant or other work or by any use made thereof.
Notice of accidents and inquiries.
161.
1. If any accident occurs in connection with the generation, transmission, distribution, supply or
use of electricity in or in connection with, any part of the electric lines or electrical plant of
any person and the accident results or is likely to have resulted in loss of human or animal
life or in any injury to a human being or an animal, such person shall give notice of the
occurrence and of any such loss or injury actually caused by the accident, in such form and
within such time as may be prescribed, to the Electrical Inspector or such other person as
aforesaid and to such other authorities as the Appropriate Government may by general or
special order, direct.
2. The Appropriate Government may, if it thinks fit, require any Electrical Inspector, or any
other person appointed by it in this behalf, to inquire and reporta. as to the cause of any accident affecting the safety of the public, which may have
been occasioned by or in connection with, the generation, transmission, distribution,
supply or use of electricity, or
b. as to the manner in, and extent to, which the provisions of this Act or rules and
regulations made thereunder or of any licence, so far as those provisions affect the
safety of any person, have been complied with.
3. Every Electrical Inspector or other person holding an inquiry under sub-section (2) shall have
all the powers of a civil court under the Code of Civil Procedure, 1908 for the purpose of
enforcing the attendance of witnesses and compelling the production of documents and
material objects, and every person required by an Electrical Inspector be legally bound to do
so within the meaning of section 176 of the Indian Penal Code.
Appointment of Chief Electrical Inspector and Electrical Inspector.
162.
1. The Appropriate Government may, by notification, appoint duly qualified persons to be
Chief Electrical Inspector or Electrical Inspectors and every such Inspector so appointed
shall exercise the powers and perform the functions of a Chief Electrical Inspector or an
Electrical Inspector under this Act and exercise such other powers and perform such other
126
functions as may be prescribed within such areas or in respect of such class of works and
electric installations and subject to such restrictions as the Appropriate Government may
direct.
2. In the absence of express provision to the contrary in this Act, or any rule made thereunder,
an appeal shall lie from the decision of a Chief Electrical Inspector or an Electrical Inspector
to the Appropriate Government or if the Appropriate Government, by general or special
order so directs, to an Appropriate Commission.
Power for licensee to enter premises and to remove fittings or other apparatus of licensee.
163.
1. A licensee or any person duly authorised by a licence may, at any reasonable time, and on
informing the occupier of his intention, enter any premises to which electricity is, or has
been, supplied by him, of any premises or land, under, over, along, across, in or upon which
the electric supply-lines or other works have been lawfully placed by him for the purpose of
–
a. inspecting, testing, repairing or altering the electric supply lines, meters, fittings,
works and apparatus for the supply of electricity belonging to the licensee; or
b. ascertaining the amount of electricity supplied or the electrical quantity contained in
the supply; or
c. removing where a supply of electricity is no longer required, or where the licensee is
authorised to take away and cut off such supply, any electric supply-lines, meters,
fittings, works or apparatus belonging to the licensee.
2. A licensee or any person authorised as aforesaid may also, in pursuance of a special order in
this behalf made by an Executive Magistrate and after giving not less than twenty-four hours
notice in writing to the occupier, a. enter any premises or land referred to in sub-section (1) for any of the purposes
mentioned therein;
b. enter any premises to which electricity is to be supplied by him, for the purpose of
examining and testing the electric wires fittings, works and apparatus for the use of
electricity belonging to the consumer.
3. Where a consumer refuses to allow a licensee or any person authorised as aforesaid to enter
his premises or land in pursuance of the provisions of sub-section (1) or, sub-section (2),
when such licensee or person has so entered, refuses to allow him to perform any act which
he is authorised by those subsections to perform, or fails to give reasonable facilities for such
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entry or performance, the licensee may, after the expiry of twenty-four hours from the
service of a notice in writing on the consumer, cut off the supply to the consumer for so long
as such refusal or failure continues, but for no longer.
Exercise of powers of Telegraph Authority in certain cases.
164.
The Appropriate Government may, by order in writing, for the placing of electric lines or electrical
plant for the transmission of electricity or for the purpose of telephonic or telegraphic
communications necessary for the proper co-ordination of works, confer upon any public officer,
licensee or any other person engaged in the business of supplying electricity under this Act, subject
to such conditions and restrictions, if any, as the Appropriate Government may think fit to impose
and to the provisions of the Indian Telegraph Act, 1885, any of the powers which the telegraph
authority possesses under that Act with respect to the placing of telegraph authority possesses under
that Act with respect to the placing of telegraph lines and posts for the purposes of a telegraph
established or maintained, by the Government or to be so established or maintained.
Amendment of Sections 40 and 41 of Act 1 of 1894.
165.
1. In section 40, sub-section (1) of clause (b) and section 41, subsection (5) of the Land
Acquisition Act, 1894, the term "work" shall be deemed to include electricity supplied or to
be supplied by means of the work to be constructed.
2. The Appropriate Government may, on recommendation of the Appropriate Commission in
this behalf, if it thinks fit, on the application of any person, not being a company desirous of
obtaining any land for its purposes, direct that he may acquire such land under the provisions
of the Land Acquisition Act, 1894 in the same manner and on the same conditions as it might
be acquired if the person were a company.
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PART- XVIII
MISCELLANEOUS
Coordination Forum
166.
1. The Central Government shall constitute a Coordination Forum consisting of the Chairperson
of the Central Commission and Members thereof, the Chairperson of the Authority,
representatives of generating companies and transmission licensees engaged in inter-State
transmission of electricity for smooth and coordinated development of the power system in
the country.
2. The Central Government shall also constitute a forum of regulators consisting of the
Chairperson of the Central Commission and Chairpersons of the State Commissions.
3. The Chairperson of the Central Commission shall be the Chairperson of the Forum of
regulators referred to in sub-section (2).
4. The State Government shall constitute a Coordination Forum consisting of the Chairperson
of the State Commission and Members thereof representatives of the generating companies,
transmission licensee and distribution licensees engaged in generation, transmission and
distribution of electricity in that State for smooth and coordinated development of the power
system in the State.
5. There shall be a committee in each district to be constituted by the Appropriate Government
a. to coordinate and review the extension of electrification in each district;
b. to review the quality of power supply and consumer satisfaction;
c. to promote energy efficiency and its conservation.
Exemption of electric lines or electrical plants from attachment in certain cases.
167.
Where any electric lines or electrical plant, belonging to a licensee are placed in or upon any
premises or land not being in the possession of the licensee, such electric lines or electrical plant
shall not be liable to be taken in execution under any process of any civil court or in any proceedings
in insolvency against the person in whose possession the same may be.
Protection of action taken in good faith.
168.
129
No suit, prosecution or other proceeding shall lie against the Appropriate Government or Appellate
Tribunal or the Appropriate Commission or any officer of Appropriate Government, or any Member,
Officer or other employees of the Appellate Tribunal or any Members, officer or other employees of
the Appropriate Commission or the assessing officer or any public servant for anything done or in
good faith purporting to be done under this Act or the rules or regulations made thereunder.
Members, officers, etc., of Appellate Tribunal, Appropriate Commission to be public servants
45 of 1860.
169.
The Chairperson, Members, officers and other employees of the Appellate Tribunal and the
Chairperson, Members, Secretary, officers and other employees of the Appropriate Commission and
the assessing officer referred to in section 126 shall be deemed, when acting or purporting to act in
pursuance of any of the provisions of this Act to be public servants within the meaning of section 21
of the Indian Penal Code.
Recovery of penalty payable under Act.
170.
Any penalty payable by a person under this Act, if not paid, may be recovered as if it were an arrear
of land revenue.
Service of notices, orders or documents
171.
1. Every notice, order or document by or under this Act required, or authorised to be addressed
to any person may be served on him by delivering the same after obtaining signed
acknowledgement receipt therefor or by registered post or such means of delivery as may be
prescribed a. where the Appropriate Government is the addressee, at the office of such officer as
the Appropriate Government may prescribe in this behalf;
b. where the Appropriate Commission is the addressee, at the office of the Appropriate
Commission;
c. where a company is the addressee, at the registered office of the company or, in the
event of the registered office of the company not being in India, at the head office of
the company in India;
d. where any other person is the addressee, at the usual or last known place of abode or
business of the person.
2. Every notice, order or document by or under this Act required or authorised to be addressed
to the owner or occupier of any premises shall be deemed to be properly addressed if
130
addressed by the description of the owner or occupier of the premises (naming the premises),
and may be served by delivering it, or a true copy thereof, to some person on the premises, or
if there is no person on the premises to whom the same can with reasonable diligence be
delivered, by affixing it on some conspicuous part of the premises.
Transitional provisions.
171.
Notwithstanding anything to the contrary contained in this Act,a. a State Electricity Board constituted under the repealed laws shall be deemed to be the State
Transmission Utility and a licensee under the provisions of this Act for a period of one year
from the appointed date or such earlier date as the State Government may notify, and shall
perform the duties and functions of the State Transmission Utility and a licensee in
accordance with the provisions of this Act and rules and regulations made thereunder:
Provided that the State Government may, by notification, authorise the State Electricity
Board to continue to function as the State Transmission Utility or a licensee for such further
period beyond the said period of one year as may be mutually decided by the Central
Government and the State Government.
b. all licences, authorisations approvals, clearances and permissions granted under the
provisions of the repealed laws may, for a period not exceeding one year from the appointed
date or such earlier period; as may be notified by the Appropriate Government, continue to
operate as if the repealed laws were in force with respect to such licence, authorisations,
approvals, clearances and permissions, as the case may be, and thereafter such
licences,clearances and permissions, as the case may be, and thereafter such licences,
authorisations, approvals, clearances and permissions shall be deemed to be licences,
authorisation, approvals, clearances and permission under this Act and all provisions of this
Act shall apply accordingly to such licences authorisations approvals, clearances and
permissions.
c. the undertaking of the State Electricity Boards established under section 5 of the Electricity
(Supply) Act, 1948 may after the expiry of the period specified in clause (a) be transferred in
accordance with the provisions of Part XIII of this Act;
d. the State Government may, by notification, declare that any or all the provisions contained in
this Act, shall not apply in that State for such period, not exceeding six months from the
appointed date, as may be stipulated in the notification.
Inconsistency in laws
173.
131
Nothing contained in this Act or any rule or regulation made thereunder or any instrument having
effect by virtue of this Act, rule or regulation shall have effect in so far as it is inconsistent with any
other provisions of the Consumer Protection Act, 1986 or the Atomic Energy Act, 1962 or the
Railways Act, 1989.
Act to have overriding effect.
174.
Save as otherwise provided in section 173, the provisions of this Act shall have effect
notwithstanding anything inconsistent therewith contained in any other law for the time being in
force or in any instrument having effect by virtue of any law other than this Act.
Provisions of this Act to be in addition to and not in derogation of other laws. Power of Central
Government to make rules.
175.
The provisions of this Act are in addition to and not in derogation of any other law for the time
being in force.
176.
1. The Central Government may, by notification, make rules for carrying out the provisions of
this Act.
2. In particular and without prejudice to the generality of the foregoing power, such rules may
provide for all or any of the following matters, namely: a. the time within which the objection and suggestions on the draft National Electricity
Plan to be invited by the Authority under the proviso to sub-section (4) of section 3;
b. the additional requirements (including the capital adequacy, creditworthiness or code
of conduct) under sixth proviso to section 14;
c. the payment of fees for application for grant of licence under sub-section (I) of
section 15;
d. the constitution and functions of the National Load Despatch Centre under subsection (2) of section 26;
e. the works of licensees affecting the property of owner or occupier under sub-section
(2) of section 67;
f. such other works which may be prescribed under clause (c) of sub-section (2) of
Section 68;
132
g. allowances and fees payable to others Members for attending the meetings of
Authority under sub-section (14) of section 70.
h. other terms and conditions of service of the Chairperson and Members of the
Authority under sub-section (15) of section 70;
i. the functions and duties of the Central Electricity Authority under section 73;
j. the salary, allowances and other conditions of service of Chairperson and Member of
Central Commission under sub-section (2) of section 89;
k. the form and manner in which and the authority before whom oath of office and
secrecy should be subscribed under sub-section (3) of section 89;
l. the procedure to be prescribed by the Central Commission under the proviso to subsection (2) of section 90;
m. any other matter required to be prescribed under clause (g) of sub-section (1) of
section 94;
n. the form in which the Central Commission shall prepare its annual statements of
accounts under sub-section (1) of section 100;
o. the form in which and time at which the Central Commission shall prepare its annual
report under sub-section (1) 101;
p. the form in which and time at which the Central Commission shall prepare its budget
under section 106;
q. the form and the manner of verifying such form, and fee for filing appeal under subsection (2) of section 111;
r. the salary and allowances payable to and the other terms and conditions of service of
the Chairperson of the Appellate Tribunal and Members of the Appellate Tribunal
under section 115;
s. the salary and allowances and other conditions of service of the officers and
employees of the Appellate Tribunal under sub-section (3) of section 119;
t. the additional matters in respect of which the Appellate Tribunal may exercise the
powers of a civil court under clause (i) of sub-section (2) of section 120;
u. the authority to whom the appeal shall be filed under sub-section (1) of section 127;
133
v. manner of holding inquiry by an adjudicating officer and subsection (1) of section
143;
w. the form in which and the time at which service of notices to any person or to the
Central Government for the purpose under sub-section (1) of section 161;
x. the powers to be exercised and the functions to be performed by the Inspectors under
sub-section (1) of section 162;
y. the manner of delivery of every notice, order or document to be served under subsection (1) of section 171;
z. any other matter which is required to be, or may be, prescribed.
Powers of Authority to make regulations.
177.
1. The Authority may, by notification, make regulations consistent with this Act and the rules
generally to carry out the provisions of this Act.
2. In particular and without prejudice to the generality of the power conferred in sub-section
(1), such regulations may provide for all or any of the following matters, namely:-a. the Grid Standards under section 34;
b. suitable measures relating to safety and electric supply under section 53;
c. the installation and operation of meters under section 55;
d. the rules of procedure for transaction of business under sub-section (9) of section 70;
e. the technical standards for construction of electrical plants and electric lines and
connectivity to the grid under clause (b) of section 73;
f. the form and manner in which and the time at which the State Government and
licensees shall furnish statistics, returns or other information under section 74.
g. any other matter which is to be, or may be, specified;
3. All regulations made by the Authority under this Act shall be subject to the conditions of
previous publication.
Powers of Central Commission to make regulations.
178.
1. The Central Commission may, by notification make regulations consistent with this Act and
the rules generally to carry out the provisions of this Act.
134
2. In particular and without prejudice to the generality of the power contained in sub-section
(1), such regulations may provide for all or any of following matters, namely:a. period to be specified under the first proviso to section 14;
b. the form and the manner of the application under sub-section (1) of section 15;
c. the manner and particulars of notice under sub-section (2) of section 15;
d. the conditions of licence under section 16;
e. the manner and particulars of notice under clause (a) of sub-section (2) of section 18;
f. publication of alterations or amendments to be made in the licence under clause(c) of
sub-section (2) of section 18;
g. Grid Code under sub-section (2) of section 28;
h. levy and collection of fees and charge from generating companies or transmission
utilities or licensees under sub-section (4) of section 28;
i. rates, charges and terms and conditions in respect of intervening transmission
facilities under proviso to section 36;
j. payment of the transmission charges and a surcharge under-sub-clause (ii) of clause
(d) of sub-section (2) of section 38;
k. reduction and elimination of surcharge and cross subsidies under second proviso to
sub-clause (ii) of clause (d) of sub-section (2) of section 38;
l. payment of transmission charges and a surcharge under sub-clause (ii) of clause(c) of
section 40;
m. reduction and elimination of surcharge and cross subsidies under the second proviso
to sub-clause (ii) of clause (c) of section 40;
n. proportion of revenues from other business to be utilised for reducing the
transmission and wheeling charges under proviso to section 41;
o. duties of electricity trader under sub-section (2) of section 52;
p. standards of performance of a licensee or class of licensees under sub-section (1) of
section 57;
135
q. the period within which information to be furnished by the licensee under sub-section
(1) of section 59;
r. the period within which the cross-subsidies shall be reduced and eliminated under
clause (g) of section 61;
s. the terms and conditions for the determination of tariff under section 61;
t. details to be furnished by licensee or generating company under sub-section (2) of
section 62;
u. the procedures for calculating the expected revenue from tariff and charges under
sub-section (5) of section 62;
v. the manner of making an application before the Central Commission and the fee
payable therefor under sub-section (1) of section 64;
w. the manner of publication of draft tariff order under sub-section (3) of section 64;
x. issue of tariff order with modifications or conditions under subsection (4) of section
64;
y. the manner by which development of market in power including trading specified
under section 66;
z. the powers and duties of the Secretary of the Central Commission under sub-section
(1) of section 91;
aa. the terms and conditions of service of the Secretary, officers and other employees of
Central Commission under sub-section (3) of section 91;
bb. the rules of procedure for transaction of business under subsection (1) of section 92;
cc. minimum information to be maintained by a licensee or the generating company and
the manner of such information to be maintained under sub-section (8) of section
128; (zd) the manner of service and publication of notice under section 130;
dd. any other matter which is to be, or may be, specified by regulations.
3. All regulations made by the Central Commission under this Act shall be subject to the
conditions of previous publication.
136
Rules and regulations to be laid before Parliament.
179.
Every rule made by the Central Government, every regulation made by the Authority, and every
regulation made by the Central Commission shall be laid, as soon as may be after it is made, before
each House of the Parliament, while it is in session, for a total period of thirty days which may be
comprised in one session or in two or more successive sessions, and if, before the expiry of the
session immediately following the session or the successive sessions aforesaid, both Houses agree in
making any modification in the rule or regulation or agree that the rule or regulation should not be
made, the rule or regulation shall thereafter have effect only in such modified form or be of no
effect, as the case may be; so, however, that any such modification or annulment shall be without
prejudice to the validity of anything previously done under that rule or regulation. .
Powers of State Governments to make rules
180.
1. The State Government may, by notification, make rules for carrying out the provisions of
this Act.
2. In particular and without prejudice to the generality of foregoing power, such rules may
provide for all or any of the following matters, namely: - .
a. the payment of fees for application for grant of licence under subsection (1) of
section 15;
b. the works of licensees affecting the property of other persons under sub- section(2) of
section 67;
c. such other matters which may be prescribed under clause (c) of subsection (2) of
section 68;
d. the salary, allowances and other terms and conditions of service of the Chairperson
and Members of the State Commission under sub-section (2) of section 89;
e. the form and manner in which and the authority before whom oath of office and
secrecy should be subscribed under sub-section (3) of section 89;
f. any other matter required to be prescribed by the State Commission under clause (g)
of sub- section (1) of section 94;
g. the manner of applying the Fund under sub-section (3) of section 103;
h. the form in which and time at which the State Commission shall prepare its annual
accounts under sub-section (1) of section 104;
137
i. the form in which and time at which the State Commission shall prepare its annual
report under sub-section (1) of section 105;
j. the form in which and time at which the State Commission shall prepare its budget
under section 106;
k. manner of service of provisional order of assessment under subsection (2) of section
126;
l. manner of holding inquiry by an adjudicating officer under subsection (1) of section
143;
m. the form in which and the time at which notice to the Electrical Inspector under subsection (1) of section 161;
n. the manner of delivery of every notice, order or document under sub-section (1) of
section 171; and
o. any other matter which is required to be, or may be, prescribed.
Powers of State Commissions to make regulations.
181.
1. The State Commissions may, by notification, make regulations consistent with this Act and
the rules generally to carry out the provisions of this Act.
2. In particular and without prejudice to the generality of the power contained in sub-section
(1), such regulations may provide for all or any of the following matters, namely: a. period to be specified under the first proviso of section 14;
b. the form and the manner of application under sub-section (1) of section 15;
c. the manner and particulars of application for licence to be published under subsection (2) of section 15;
d. the conditions of licence section 16;
e. the manner and particulars of notice under clause(a) of subsection (2) of section 18;
f. publication of the alterations or amendments to be made in the licence under clause
(c) of sub-section (2) of section 18;
g. levy and collection of fees and charges from generating companies or licensees under
sub-section (3) of section 32;
138
h. rates, charges and the term and conditions in respect of intervening transmission
facilities under proviso to section 36;
i. payment of the transmission charges and a surcharge under subclause (ii) of clause(d)
of sub-section (2) of section 39;
j. reduction and elimination of surcharge and cross subsidies under second proviso to
sub-clause (ii) of clause (d) of sub-section (2) of section 39;
k. manner and utilisation of payment and surcharge under the fourth proviso to subclause(ii) of clause (d) of sub-section (2) of section 39;
l. payment of the transmission charges and a surcharge under subclause( ii) of clause
(c) of section 40;
m. reduction and elimination of surcharge and cross subsidies under second proviso to
sub-clause (ii) of clause (c) of section 40;
n. the manner of payment of surcharge under the fourth proviso to sub-clause (ii) of
clause (c) of section 40;
o. proportion of revenues from other business to be utilised for reducing the
transmission and wheeling charges under proviso to section 41;
p. reduction and elimination of surcharge and cross-subsidies under the third proviso to
sub-section (2) of section 42;
q. payment of additional charges on charges of wheeling under subsection (4) of section
42;
r. guidelines under sub-section (5) of section 42;
s. the time and manner for settlement of grievances under sub-section (7) of section 42;
t. the period to be specified by the State Commission under sub-section (1) of section
43;
u. methods and principles by which charges for electricity shall be fixed under subsection (2) of section 45;
v. reasonable security payable to the distribution licensee under sub-section (1) of
section 47;
w. payment of interest on security under sub-section (4) of section 47;
139
x. electricity supply code under section 50;
y. the proportion of revenues from other business to be utilised for reducing wheeling
charges under proviso to section 51;
z. duties of electricity trader under sub-section (2) of section 52;
aa. standards of performance of a licensee or a class of licensees under sub-section (1) of
section 57;
bb. the period within which information to be furnished by the licensee under sub-section
(1) of section 59;
cc. the period within which the cross-subsidies shall be reduced and eliminated under
clause (g) of section 61;
dd. the terms and conditions for the determination of tariff under section 61;
ee. details to be furnished by licensee or generating company under sub-section (2) of
section 62;
ff. the methodologies and procedures for calculating the expected revenue from tariff
and charges under sub-section (1) of section 62;
gg. the manner of making an application before the State Commission and the fee
payable therefor under sub-section (1) of section 64;
hh. issue of tariff order with modifications or conditions under subsection( 3) of section
64;
ii. the manner by the which development of market in power including trading specified
under section 66;
jj. the powers and duties of the Secretary of the State Commission under sub-section (1)
of section 91;
kk. the terms and conditions of service of the secretary, officers and other employees of
the State Commission under sub-section (2) of section 91;
ll. rules of procedure for transaction of business under sub-section (1) of section 92;
mm.
minimum information to be maintained by a licensee or the generating
company and the manner of such information to be maintained under sub-section (8)
of section 128;
140
nn. the manner of service and publication of notice under section 130;
oo. the form of and preferring the appeal and manner in which such form shall be verified
and the fee for preferring the appeal under sub-section (1) of section 127;
pp. any other matter which is to be, or may be, specified.
3. All regulations made by the State Commission under this Act shall be subject to the
condition of previous publication.
Rules and regulations to be laid before State Legislature
182.
Every rule made by the State Government and every regulation made by the State Commission shall
be laid, as soon as may be after it is made, before each House of the State Legislature where it
consists of two Houses, or where such Legislature consists of one House, before that House.
Power to remove difficulties.
183.
1. If any difficulty arises in giving effect to the provisions of this Act, the Central Government
may, by order published, make such provisions not inconsistent with the provisions of this
Act, as may appear to be necessary for removing the difficulty: Provided that no order shall
be made under this section after the expiry of two years from the date of commencement of
this Act.
2. Every order made under this section shall be laid, as soon as may be after it is made, before
each House’ of Parliament.
Provisions of Act not to apply in certain cases.
184.
The provisions of this Act shall not apply to the Ministry or Department of the Central Government
dealing with Defence, Atomic Energy or such other similar Ministries or Departments or
undertakings or Boards or institutions under the control of such Ministries or Departments as may be
notified by the Central Government.
Repeal and saving.
185.
1. Save as otherwise provided in this Act, the Indian Electricity Act, 1910, the Electricity
(Supply) Act, 1948 and the Electricity Regulatory Commissions Act, 1998 are hereby
repealed.
2. Notwithstanding such repeal, -
141
a. anything done or any action taken or purported to have been done or taken including
any rule, notification, inspection, order or notice made or issued or any appointment,
confirmation or declaration made or any licence, permission, authorisation or
exemption granted or any document or instrument executed or any direction given
under the repealed laws shall, in so far as it is not inconsistent with the provisions of
this Act, be deemed to have been done or taken under the corresponding provisions of
this Act.
b. the provisions contained in sections 12 to 18 of the Indian Electricity Act, 1910 and
rules made thereunder shall have effect until the rules under section 67 to 69 of this
Act are made;.
c. Indian Electricity Rules, 1956 made under section 37 of the Indian Electricity Act,
1910 as it stood before such repeal shall continue to be in force till the regulations
under section 53 of this Act are made. force till the regulations under section 53 of
this Act are made.
d. all rules made under sub-section (1) of section 69 of the Electricity (Supply) Act,
1948 shall continue to have effect until such rules are rescinded or modified, as the
case may be;
e. all directives issued, before the commencement of this Act, by a State Government
under the enactments specified in the Schedule shall continue to apply for the period
for which such directions were issued by the State Government.” .
3. The provisions of the enactments specified in the Schedule, not inconsistent with the
provisions of this Act, shall apply to the States in which such enactments are applicable.
4. The Central Government may, as and when considered necessary, by notification, amend the
Schedule.
5. Save as otherwise provided in sub-section (2), the mention of particular matters in that
section, shall not be held to prejudice or affect the general application of section 6 of the
General Clauses Act, 1897, with regard to the effect of repeals.
142
THE SCHEDULE
ENACTMENTS
( See sub-Section (3) of Section 185)
1. The Orissa Electricity Reform Act, 1995 (Orissa Act no. 2 of 1996)
2. The Haryana Electricity Reform Act, 1997 (Haryana Act no. 10 of 1998)
3. The Andhra Pradesh Electricity Reform Act, 1998 (Andhra Pradesh Act no. 30 of 1998)
4. The Uttar Pradesh Electricity Reform Act, 1999 (Uttar Pradesh Act no. 24 of 1999)
5. The Karnataka Electricity Reform Act, 1999 (Karnataka Act no. 25 of 1999)
6. The Rajasthan Electricity Reform Act, 1999 (Rajasthan Act no. 23 of 1999)
7. The Delhi Electricity Reforms Act, 2000 (Delhi Act No.2 of 2001)
8. The Madhya Pradesh Vidyut Sudhar Adhiniyam, 2000 (Madhya Pradesh Act No. 4 of 2001)
143
The Electricity (Amendment) Act, 2003 dated 30th December, 2003
Copy of The Gazette of India
EXTRAORDINARY
PART I -- Section 1
PUBLISHED BY AUTHORITY
No 71 New Delhi, Dated December 31, 2003
MINISTRY IF KAW AND JUSTICE
(Legislative Department)
New Delhi, the 31st December, 2003
The following Act of Parliament received the assent of the President on the 30th December, 2003
and is hereby published for general information:-THE ELECTRICITY (AMENDMENT) ACT, 2003
No. 57 OF 2003
[ 30th December, 2003.]
An Act to amend the Electricity Act, 2003.
Be it enacted by Parliament in the Fifty-fourth Year of the Republic of India as follows:-1. ( 1 ) This Act may be called the Electricity (Amendment) Act, 2003.
( 2 ) It shall come into force on such date as the Central Government may,
by notification in the Official Gazette, appoint.
2. In section 14 of the Electricity Act, 2003 (hereinafter referred to as the principal
Act), in the sixth proviso, for the brackets and words “(including the capital
adequacy, creditworthiness, or code of conduct)”, the words “relating to the capital
adequacy, creditworthiness, or code of conduct “ shall be substituted.
3.
In section 42 of the principal Act, in sub-section (23), after the fourth proviso, the
following proviso shall be inserted, namely,:--
“ Provided also that the State Commission shall, not later than five years from the dated
of commencement of the Electricity (Amendment) Act, 2003, by regulations, provide
such open access to all consumers who require a supply of electricity where the
maximum power to be made available at any time exceeds one megawatt.”
144
4. For section 121 of the principal Act, the following section shall be substituted,
namely:--
“121. The Appellate Tribunal, may , after hearing the Appropriate Commission or
other interested party, if any, from time to time, issue such orders, instructions or
directions as it may deep fit, to any Appropriate Commission for the performance of
its statutory functions under this Act.”.
5. In section 135 of the principal Act, in sub-section (2), -(i)
(ii)
in clause (a), for the words “has been, is being, or is likely to be, “ , the words
“has been or is being “ shall be substituted.
in clause (b), for the words, “has been, is being, or is likely to be, “ , the
words “has been or is being “ shall be substituted.
6. For sections 139 and 140 of the principal Act, the following sections shall be
substituted, namely:-“139. Whoever, negligently breaks, injures, throws down or damages many material
connected with the supply of electricity, shall be punishable with fine which may extend to
ten thousand rupees.
140. Whoever, with intent to cut off the supply of electricity, cuts or attempts to cut or
injure, any electric supply line or works, shall be punishable with fine which may extend to
ten thousand rupees.”.
7. In section 146 of the principal Act, the following proviso shall be inserted, namely:“Provided that nothing contained in this section shall apply to the orders, instructions
or directions issued under section 121.”
T.K. VISWANATHAN,
Secy. to the Govt. of India.
145
Review of policies – Supercession of outdated circulars and guidelines
No.37/10/2004-H.II
Government of India
Ministry of Power
…
Shram Shakti Bhawan, Rafi Marg,
New Delhi, dated the May 25, 2005
OFFICE MEMORANDUM
Sub:
Review of policies in view of the provisions of Electricity Act, 2003.
…..
The undersigned is directed to say that keeping in view that the provisions made in the Electricity
Act, 2003, the following DOs / letters may be treated as superceded:-
Sl.No.
1
No. / Date
D.O.6/1/Tariff/captive
power/95 dated
9.10.1995
Subject
Private power
promotion through
captive power / cogeneration route.
Status
As per Electricity Act, 2003, captive
generation has been freely permitted and
tariff setting is to be done by Regulatory
Commissions.
Therefore, instructions
contained in this letter stand superceded.
As captive generation has been freely
allowed by the new Electricity Act, the
instructions contained therein stand
superceded. Tariff fixation for sale of
surplus power from captive plants will be
regulated by Regulatory Commissions.
2
D.O.No.A-31/94-IPC
dated 9.1.1997
3
D.O.No.A-82/97IPC.I dated
21.10.1999
4
O.M.No.C-323/95IPC.II dated
19.1.1996
5
D.O.No.4/1/96-IPC.II
dated 28.6.1996
6
Letter No.A-58/95IPC dated 15.10.1996
7
D.O.No.2/5/97-IPC.II
dated 10.1.1997
Instructions regarding
IPPs meant exclusively
for the captive use of an
industry or a group of
industries
without
involving any sale to
State Grid.
Captive co-generation As there is no requirement of concurrence
power plants.
from CEA except for hydro electric plants,
the instructions contained therein stand
superceded.
List of clearance that As generation has been delicensed, the
will be required by instructions contained therein stand
CEA for considering superceded. However, CEA will be required
TEC.
to issue detailed instructions for hydro
projects.
Deadline for submission These instructions are no more relevant now
of DPRs on the and stand superceded.
MOU/LOI, etc., route
Permitting Indian EPC The guidelines for transparent bidding
contract to bid in any process have been issued under Section 63
currency.
of the Act, the instructions contained in this
letter stand superceded.
Policy
regarding As generation has been delicensed, the
expansion of power instructions contained therein stand
146
8
D.O.No.A-53/95IPC.I dated 3.6.1997
9
Letter No. A-82/97IPC.I dated 21.5.2002
projects
in
private superceded.
sector.
Guidelines for inviting The guidelines for tariff determination
tariff based bids.
through competitive bidding have been
issued under Section 63 of the Act. These
guidelines of 1997 stand superceded.
Policy for promoting As policy regarding choice of fuel has been
power
plants
by laid down in National Electricity Policy,
refineries using refinery this policy of 2002 stand superceded.
residues.
Sd/(Dev Dutt)
Under Secretary to the Govt. of India
Tele. No.2371 5507/Extn.213, 349
To
i)
All Chief Secretaries, Power / Energy Secretaries of State Governments / Utilities
ii)
Chairmen of State Electricity Boards
iii)
Chairperson, CEA.
147
National Electricity Policy (12.02.2005)
The Gazette of India
EXTRAORDINARY
PART I - Section 1
PUBLISHED BY AUTHORITY
No…., New Delhi, Dated ….
Ministry of Power
New Delhi,
Dated the 12th, February, 2005
RESOLUTION
No. 23/40/2004-R&R (Vol.II)
1.0 INTRODUCTION
1.1 In compliance with section 3 of the Electricity Act 2003 the Central Government hereby notifies
the National Electricity Policy.
1.2 Electricity is an essential requirement for all facets of our life. It has been recognized as a basic
human need. It is a critical infrastructure on which the socio-economic development of the country
depends. Supply of electricity at reasonable rate to rural India is essential for its overall
development. Equally important is availability of reliable and quality power at competitive rates to
Indian industry to make it globally competitive and to enable it to exploit the tremendous potential
of employment generation. Services sector has made significant contribution to the growth of our
economy. Availability of quality supply of electricity is very crucial to sustained growth of this
segment.
1.3 Recognizing that electricity is one of the key drivers for rapid economic growth and poverty
alleviation, the nation has set itself the target of providing access to all households in next five years.
As per Census 2001, about 44% of the households do not have access to electricity. Hence meeting
the target of providing universal access is a daunting task requiring significant addition to generation
capacity and expansion of the transmission and distribution network.
1.4 Indian Power sector is witnessing major changes. Growth of Power Sector in India since its
Independence has been noteworthy. However, the demand for power has been outstripping the
growth of availability. Substantial peak and energy shortages prevail in the country. This is due to
inadequacies in generation, transmission & distribution as well as inefficient use of electricity. Very
148
high level of technical and commercial losses and lack of commercial approach in management of
utilities has led to unsustainable financial operations. Cross-subsidies have risen to unsustainable
levels. Inadequacies in distribution networks has been one of the major reasons for poor quality of
supply.
1.5 Electricity industry is capital-intensive having long gestation period. Resources of power
generation are unevenly dispersed across the country. Electricity is a commodity that can not be
stored in the grid where demand and supply have to be continuously balanced. The widely
distributed and rapidly increasing demand requirements of the country need to be met in an optimum
manner.
1.6 Electricity Act, 2003 provides an enabling framework for accelerated and more efficient
development of the power sector. The Act seeks to encourage competition with appropriate
regulatory intervention. Competition is expected to yield efficiency gains and in turn result in
availability of quality supply of electricity to consumers at competitive rates.
1.7 Section 3 (1) of the Electricity Act 2003 requires the Central Government to formulate, inter alia,
the National Electricity Policy in consultation with Central Electricity Authority (CEA) and State
Governments. The provision is quoted below:
"The Central Government shall, from time to time, prepare the National Electricity Policy and tariff
policy, in consultation with the State Governments and the Authority for development of the power
system based on optimal utilization of resources such as coal, natural gas, nuclear substances or
materials, hydro and renewable sources of energy".
Section 3 (3) of the Act enables the Central Government to review or revise the National Electricity
Policy from time to
time.
1.8 The National Electricity Policy aims at laying guidelines for accelerated development of the
power sector, providing supply of electricity to all areas and protecting interests of consumers and
other stakeholders keeping in view availability of energy resources, technology available to exploit
these resources, economics of generation using different resources, and energy security issues.
1.9 The National Electricity Policy has been evolved in consultation with and taking into account
views of the State Governments, Central Electricity Authority (CEA), Central Electricity Regulatory
Commission (CERC) and other stakeholders.
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2.0 AIMS & OBJECTIVES
The National Electricity Policy aims at achieving the following objectives:
Access to Electricity - Available for all households in next five years
Availability of Power - Demand to be fully met by 2012. Energy and peaking shortages to be
overcome and adequate spinning reserve to be available.
Supply of Reliable and Quality Power of specified standards in an efficient manner and at
reasonable rates.
Per capita availability of electricity to be increased to over 1000 units by 2012.
Minimum lifeline consumption of 1 unit/household/day as a merit good by year 2012.
Financial Turnaround and Commercial Viability of Electricity Sector.
Protection of consumers’ interests.
3. NATIONAL ELECTRICITY PLAN
3.1 Assessment of demand is an important pre-requisite for planning capacity addition. Section 3 (4)
of the Act requires the Central Electricity Authority (CEA) to frame a National Electricity Plan once
in five years and revise the same from time to time in accordance with the National Electricity
Policy. Also, section 73 (a) provides that formulation of short-term and perspective plans for
development of the electricity system and coordinating the activities of various planning agencies
for the optimal utilization of resources to subserve the interests of the national economy shall be one
of the functions of the CEA. The Plan prepared by CEA and approved by the Central Government
can be used by prospective generating companies, transmission utilities and
transmission/distribution licensees as reference document.
3.2 Accordingly, the CEA shall prepare short-term and perspective plan. The National Electricity
Plan would be for a short-term framework of five years while giving a 15 year perspective and
would include:
Short-term and long term demand forecast for different regions;
150
Suggested areas/locations for capacity additions in generation and transmission keeping in
view the economics of generation and transmission, losses in the system, load centre
requirements, grid stability, security of supply, quality of power including voltage profile etc.
and environmental considerations including rehabilitation and resettlement;
Integration of such possible locations with transmission system and development of national
grid including type of transmission systems and requirement of redundancies; and
Different technologies available for efficient generation, transmission and distribution.
Fuel choices based on economy, energy security and environmental considerations.
3.3 While evolving the National Electricity Plan, CEA will consult all the stakeholders including
state governments and the state governments would, at state level, undertake this exercise in
coordination with stakeholders including distribution licensees and STUs. While conducting studies
periodically to assess short-term and long-term demand, projections made by distribution utilities
would be given due weightage. CEA will also interact with institutions and agencies having
economic expertise, particularly in the field of demand forecasting. Projected growth rates for
different sectors of the economy will also be taken into account in the exercise of demand
forecasting.
3.4 The National Electricity Plan for the ongoing 10th Plan period and 11th Plan and perspective
Plan for the 10th, 11th & 12th Plan periods would be prepared and notified after reviewing and
revising the existing Power Plan prepared by CEA. This will be done within six months.
4.0 ISSUES ADDRESSED
The policy seeks to address the following issues:
Rural Electrification
Generation
Transmission
Distribution
Recovery of Cost of services & Targetted Subsidies.
Technology Development and Research and Development (R&D)
Competition aimed at Consumer Benefits
Financing Power Sector Programmes Including Private Sector Participation.
Energy Conservation
151
Environmental Issues
Training and Human Resource Development
Cogeneration and Non-Conventional Energy Sources
Protection of Consumer interests and Quality Standards
5.1 RURAL ELECTRIFICATION
5.1.1 The key development objective of the power sector is supply of electricity to all areas
including rural areas as mandated in section 6 of the Electricity Act. Both the central government
and state governments would jointly endeavour to achieve this objective at the earliest. Consumers,
particularly those who are ready to pay a tariff which reflects efficient costs have the right to get
uninterrupted twenty four hours supply of quality power. About 56% of rural households have not
yet been electrified even though many of these households are willing to pay for electricity.
Determined efforts should be made to ensure that the task of rural electrification for securing
electricity access to all households and also ensuring that electricity reaches poor and marginal
sections of the society at reasonable rates is completed within the next five years.
5.1.2 Reliable rural electrification system will aim at creating the following:
(a) Rural Electrification Distribution Backbone (REDB) with at least one 33/11 kv (or 66/11 kv)
substation in every Block and more if required as per load, networked and connected appropriately
to the state transmission system
(b) Emanating from REDB would be supply feeders and one distribution transformer at least in
every village settlement.
(c) Household Electrification from distribution transformer to connect every household on demand.
(d) Wherever above is not feasible (it is neither cost effective nor the optimal solution to provide
grid connectivity) decentralized distributed generation facilities together with local distribution
network would be provided so that every household gets access to electricity. This would be done
either through conventional or non-conventional methods of electricity generation whichever is
more suitable and economical. Non-conventional sources of energy could be utilized even where
grid connectivity exists provided it is found to be cost effective.
(e) Development of infrastructure would also cater for requirement of agriculture & other economic
activities including irrigation pump sets, small and medium industries, khadi and village industries,
cold chain and social services like health and education.
5.1.3 Particular attention would be given in household electrification to dalit bastis, tribal areas and
152
other weaker sections.
5.1.4 Rural Electrification Corporation of India, a Government of India enterprise will be the nodal
agency at Central Government level to implement the programme for achieving the goal set by
National Common Minimum Programme of giving access to electricity to all the households in next
five years. Its role is being suitably enlarged to ensure timely implementation of rural electrification
projects.
5.1.5 Targetted expansion in access to electricity for rural households in the desired timeframe can
be achieved if the distribution licensees recover at least the cost of electricity and related O&M
expenses from consumers, except for lifeline support to households below the poverty line who
would need to be adequately subsidized. Subsidies should be properly targeted at the intended
beneficiaries in the most efficient manner. Government recognizes the need for providing necessary
capital subsidy and soft long-term debt finances for investment in rural electrification as this would
reduce the cost of supply in rural areas. Adequate funds would need to be made available for the
same through the Plan process. Also commensurate organizational support would need to be created
for timely implementation. The Central Government would assist the State Governments in
achieving this.
5.1.6 Necessary institutional framework would need to be put in place not only to ensure creation of
rural electrification infrastructure but also to operate and maintain supply system for securing
reliable power supply to consumers. Responsibility of operation & maintenance and cost recovery
could be discharged by utilities through appropriate arrangements with Panchayats, local authorities,
NGOs and other franchisees etc.
5.1.7 The gigantic task of rural electrification requires appropriate cooperation among various
agencies of the State Governments, Central Government and participation of the community.
Education and awareness programmes would be essential for creating demand for electricity and for
achieving the objective of effective community participation.
5.2 GENERATION
5.2.1 Inadequacy of generation has characterized power sector operation in India. To provide
availability of over 1000 units of per capita electricity by year 2012 it had been estimated that need
based capacity addition of more than 1,00,000 MW would be required during the period 2002-12.
5.2.2 The Government of India has initiated several reform measures to create a favourable
environment for addition of new generating capacity in the country. The Electricity Act 2003 has put
in place a highly liberal framework for generation. There is no requirement of licensing for
generation. The requirement of techno-economic clearance of CEA for thermal generation project is
153
no longer there. For hydroelectric generation also, the limit of capital expenditure, above which
concurrence of CEA is required, would be raised suitably from the present level. Captive generation
has been freed from all controls.
5.2.3 In order to fully meet both energy and peak demand by 2012, there is a need to create adequate
reserve capacity margin. In addition to enhancing the overall availability of installed capacity to
85%, a spinning reserve of at least 5%, at national level, would need to be created to ensure grid
security and quality and reliability of power supply.
5.2.4 The progress of implementation of capacity addition plans and growth of demand would need
to be constantly monitored and necessary adjustments made from time to time. In creating new
generation capacities, appropriate technology may be considered keeping in view the likely
widening of the difference between peak demand and the base load.
Hydro Generation
5.2.5 Hydroelectricity is a clean and renewable source of energy. Maximum emphasis would be laid
on the full development of the feasible hydro potential in the country. The 50,000 MW hydro
initiative has been already launched and is being vigorously pursued with DPRs for projects of
33,000 MW capacity already under preparation.
5.2.6 Harnessing hydro potential speedily will also facilitate economic development of States,
particularly North-Eastern States, Sikkim, Uttaranchal, Himachal Pradesh and J&K, since a large
proportion of our hydro power potential is located in these States. The States with hydro potential
need to focus on the full development of these potentials at the earliest.
5.2.7 Hydel projects call for comparatively larger capital investment. Therefore, debt financing of
longer tenure would need to be made available for hydro projects. Central Government is committed
to policies that ensure financing of viable hydro projects.
5.2.8 State Governments need to review procedures for land acquisition, and other
approvals/clearances for speedy implementation of hydroelectric projects.
5.2.9 The Central Government will support the State Governments for expeditious development of
their hydroelectric projects by offering services of Central Public Sector Undertakings like National
Hydroelectric Power Corporation (NHPC).
5.2.10 Proper implementation of National Policy on Rehabilitation and Resettlement (R&R) would
be essential in this regard so as to ensure that the concerns of project-affected families are addressed
adequately.
5.2.11 Adequate safeguards for environmental protection with suitable mechanism for monitoring of
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implementation of Environmental Action Plan and R&R Schemes will be put in place.
Thermal Generation
5.2.12 Even with full development of the feasible hydro potential in the country, coal would
necessarily continue to remain the primary fuel for meeting future electricity demand.
5.2.13 Imported coal based thermal power stations, particularly at coastal locations, would be
encouraged based on their economic viability. Use of low ash content coal would also help in
reducing the problem of fly ash emissions.
5.2.14 Significant Lignite resources in the country are located in Tamil Nadu, Gujarat and Rajasthan
and these should be increasingly utilized for power generation. Lignite mining technology needs to
be improved to reduce costs.
5.2.15 Use of gas as a fuel for power generation would depend upon its availability at reasonable
prices. Natural gas is being used in Gas Turbine /Combined Cycle Gas Turbine (GT/CCGT)
stations, which currently accounts for about 10 % of total capacity. Power sector consumes about
40% of the total gas in the country. New power generation capacity could come up based on
indigenous gas findings, which can emerge as a major source of power generation if prices are
reasonable. A national gas grid covering various parts of the country could facilitate development of
such capacities.
5.2.16 Imported LNG based power plants are also a potential source of electricity and the pace of
their development would depend on their commercial viability. The existing power plants using
liquid fuels should shift to use of Natural Gas/LNG at the earliest to reduce the cost of generation.
5.2.17 For thermal power, economics of generation and supply of electricity should be the basis for
choice of fuel from among the options available. It would be economical for new generating stations
to be located either near the fuel sources e.g. pithead locations or load centres.
5.2.18 Generating companies may enter into medium to long-term fuel supply agreements specially
with respect to imported fuels for commercial viability and security of supply.
Nuclear Power
5.2.19 Nuclear power is an established source of energy to meet base load demand. Nuclear power
plants are being set up at locations away from coalmines. Share of nuclear power in the overall
capacity profile will need to be increased significantly. Economics of generation and resultant tariff
will be, among others, important considerations. Public sector investments to create nuclear
generation capacity will need to be stepped up. Private sector partnership would also be facilitated to
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see that not only targets are achieved but exceeded.
Non-conventional Energy Sources
5.2.20 Feasible potential of non-conventional energy resources, mainly small hydro, wind and biomass would also need to be exploited fully to create additional power generation capacity. With a
view to increase the overall share of non-conventional energy sources in the electricity mix, efforts
will be made to encourage private sector participation through suitable promotional measures.
Renovation and Modernization (R&M)
5.2.21 One of the major achievements of the power sector has been a significant increase in
availability and plant load factor of thermal power stations specially over the last few years.
Renovation and modernization for achieving higher efficiency levels needs to be pursued vigorously
and all existing generation capacity should be brought to minimum acceptable standards. The Govt.
of India is providing financial support for this purpose.
5.2.22 For projects performing below acceptable standards, R&M should be undertaken as per welldefined plans featuring necessary cost-benefit analysis. If economic operation does not appear
feasible through R&M, then there may be no alternative to closure of such plants as the last resort.
5.2.23 In cases of plants with poor O&M record and persisting operational problems, alternative
strategies including change of management may need to be considered so as to improve the
efficiency to acceptable levels of these power stations.
Captive Generation
5.2.24 The liberal provision in the Electricity Act, 2003 with respect to setting up of captive power
plant has been made with a view to not only securing reliable, quality and cost effective power but
also to facilitate creation of employment opportunities through speedy and efficient growth of
industry.
5.2.25 The provision relating to captive power plants to be set up by group of consumers is primarily
aimed at enabling small and medium industries or other consumers that may not individually be in a
position to set up plant of optimal size in a cost effective manner. It needs to be noted that efficient
expansion of small and medium industries across the country would lead to creation of enormous
employment opportunities.
5.2.26 A large number of captive and standby generating stations in India have surplus capacity that
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could be supplied to the grid continuously or during certain time periods. These plants offer a
sizeable and potentially competitive capacity that could be harnessed for meeting demand for power.
Under the Act, captive generators have access to licensees and would get access to consumers who
are allowed open access. Grid inter-connections for captive generators shall be facilitated as per
section 30 of the Act. This should be done on priority basis to enable captive generation to become
available as distributed generation along the grid. Towards this end, non-conventional energy
sources including co-generation could also play a role. Appropriate commercial arrangements would
need to be instituted between licensees and the captive generators for harnessing of spare capacity
energy from captive power plants. The appropriate Regulatory Commission shall exercise regulatory
oversight on such commercial arrangements between captive generators and licensees and determine
tariffs when a licensee is the off-taker of power from captive plant.
5.3 TRANSMISSION
5.3.1 The Transmission System requires adequate and timely investments and also efficient and
coordinated action to develop a robust and integrated power system for the country.
5.3.2 Keeping in view the massive increase planned in generation and also for development of
power market, there is need for adequately augmenting transmission capacity. While planning new
generation capacities, requirement of associated transmission capacity would need to be worked out
simultaneously in order to avoid mismatch between generation capacity and transmission facilities.
The policy emphasizes the following to meet the above objective:
The Central Government would facilitate the continued development of the National Grid for
providing adequate infrastructure for inter-state transmission of power and to ensure that
underutilized generation capacity is facilitated to generate electricity for its transmission
from surplus regions to deficit regions.
The Central Transmission Utility (CTU) and State Transmission Utility (STU) have the key
responsibility of network planning and development based on the National Electricity Plan in
coordination with all concerned agencies as provided in the Act. The CTU is responsible for
the national and regional transmission system planning and development. The STU is
responsible for planning and development of the intra-state transmission system. The CTU
would need to coordinate with the STUs for achievement of the shared objective of
eliminating transmission constraints in cost effective manner.
Network expansion should be planned and implemented keeping in view the anticipated
transmission needs that would be incident on the system in the open access regime. Prior
agreement with the beneficiaries would not be a pre-condition for network expansion.
CTU/STU should undertake network expansion after identifying the requirements in
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consultation with stakeholders and taking up the execution after due regulatory approvals.
Structured information dissemination and disclosure procedures should be developed by the
CTU and STUs to ensure that all stakeholders are aware of the status of generation and
transmission projects and plans. These should form a part of the overall planning procedures.
The State Regulatory Commissions who have not yet notified the grid code under the
Electricity Act 2003 should notify the same not later than September 2005.
5.3.3 Open access in transmission has been introduced to promote competition amongst the
generating companies who can now sell to different distribution licensees across the country. This
should lead to availability of cheaper power. The Act mandates non-discriminatory open access in
transmission from the very beginning. When open access to distribution networks is introduced by
the respective State Commissions for enabling bulk consumers to buy directly from competing
generators, competition in the market would increase the availability of cheaper and reliable power
supply. The Regulatory Commissions need to provide facilitative framework for non-discriminatory
open access. This requires load dispatch facilities with state-of-the art communication and data
acquisition capability on a real time basis. While this is the case currently at the regional load
dispatch centers, appropriate State Commissions must ensure that matching facilities with
technology upgrades are provided at the State level, where necessary and realized not later than June
2006.
5.3.4 The Act prohibits the State transmission utilities/transmission licensees from engaging in
trading in electricity. Power purchase agreements (PPAs) with the generating companies would need
to be suitably assigned to the Distribution Companies, subject to mutual agreement. To the extent
necessary, such assignments can be done in a manner to take care of different load profiles of the
Distribution Companies. Non-discriminatory open access shall be provided to competing generators
supplying power to licensees upon payment of transmission charge to be determined by the
appropriate Commission. The appropriate Commissions shall establish such transmission charges no
later than June 2005.
5.3.5 To facilitate orderly growth and development of the power sector and also for secure and
reliable operation of the grid, adequate margins in transmission system should be created. The
transmission capacity would be planned and built to cater to both the redundancy levels and margins
keeping in view international standards and practices. A well planned and strong transmission
system will ensure not only optimal utilization of transmission capacities but also of generation
facilities and would facilitate achieving ultimate objective of cost effective delivery of power. To
facilitate cost effective transmission of power across the region, a national transmission tariff
framework needs to be implemented by CERC. The tariff mechanism would be sensitive to distance,
direction and related to quantum of flow. As far as possible, consistency needs to be maintained in
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transmission pricing framework in inter-State and intra-State systems. Further it should be ensured
that the present network deficiencies do not result in unreasonable transmission loss compensation
requirements.
5.3.6 The necessary regulatory framework for providing non-discriminatory open access in
transmission as mandated in the Electricity Act 2003 is essential for signalling efficient choice in
locating generation capacity and for encouraging trading in electricity for optimum utilization of
generation resources and consequently for reducing the cost of supply.
5.3.7 The spirit of the provisions of the Act is to ensure independent system operation through
NLDC, RLDCs and SLDCs. These dispatch centers, as per the provisions of the Act, are to be
operated by a Government company or authority as notified by the appropriate Government.
However, till such time these agencies/authorities are established the Act mandates that the CTU or
STU, as the case may be, shall operate the RLDCs or SLDC. The arrangement of CTU operating the
RLDCs would be reviewed by the Central Government based on experience of working with the
existing arrangement. A view on this aspect would be taken by the Central Government by
December 2005.
5.3.8 The Regional Power Committees as envisaged in section section 2(55) would be constituted by
the Government of India within two months with representation from various stakeholders.
5.3.9 The National Load Despatch Centre (NLDC) along with its constitution and functions as
envisaged in Section 26 of the Electricity Act 2003 would be notified within three months. RLDCs
and NLDC will have complete responsibility and commensurate authority for smooth operation of
the grid irrespective of the ownership of the transmission system, be it under CPSUs, State Utility or
private sector.
5.3.10 Special mechanisms would be created to encourage private investment in transmission sector
so that sufficient investments are made for achieving the objective of demand to be fully met by
2012.
5.4 DISTRIBUTION
5.4.1 Distribution is the most critical segment of the electricity business chain. The real challenge of
reforms in the power sector lies in efficient management of the distribution sector.
5.4.2 The Act provides for a robust regulatory framework for distribution licensees to safeguard
consumer interests. It also creates a competitive framework for the distribution business, offering
options to consumers, through the concepts of open access and multiple licensees in the same area of
supply.
5.4.3 For achieving efficiency gains proper restructuring of distribution utilities is essential.
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Adequate transition financing support would also be necessary for these utilities. Such support
should be arranged linked to attainment of predetermined efficiency improvements and reduction in
cash losses and putting in place appropriate governance structure for insulating the service providers
from extraneous interference while at the same time ensuring transparency and accountability. For
ensuring financial viability and sustainability, State Governments would need to restructure the
liabilities of the State Electricity Boards to ensure that the successor companies are not burdened
with past liabilities. The Central Government would also assist the States, which develop a clear
roadmap for turnaround, in arranging transition financing from various sources which shall be linked
to predetermined improvements and efficiency gains aimed at attaining financial viability and also
putting in place appropriate governance structures.
5.4.4 Conducive business environment in terms of adequate returns and suitable transitional model
with predetermined improvements in efficiency parameters in distribution business would be
necessary for facilitating funding and attracting investments in distribution. Multi-Year Tariff
(MYT) framework is an important structural incentive to minimize risks for utilities and consumers,
promote efficiency and rapid reduction of system losses. It would serve public interest through
economic efficiency and improved service quality. It would also bring greater predictability to
consumer tariffs by restricting tariff adjustments to known indicators such as power purchase prices
and inflation indices. Private sector participation in distribution needs to be encouraged for
achieving the requisite reduction in transmission and distribution losses and improving the quality of
service to the consumers.
5.4.5 The Electricity Act 2003 enables competing generating companies and trading licensees,
besides the area distribution licensees, to sell electricity to consumers when open access in
distribution is introduced by the State Electricity Regulatory Commissions. As required by the Act,
the SERCs shall notify regulations by June 2005 that would enable open access to distribution
networks in terms of sub-section 2 of section 42 which stipulates that such open access would be
allowed, not later than five years from 27th January 2004 to consumers who require a supply of
electricity where the maximum power to be made available at any time exceeds one mega watt.
Section 49 of the Act provides that such consumers who have been allowed open access under
section 42 may enter into agreement with any person for supply of electricity on such terms and
conditions, including tariff, as may be agreed upon by them. While making regulations for open
access in distribution, the SERCs will also determine wheeling charges and cross-subsidy surcharge
as required under section 42 of the Act.
5.4.6 A time-bound programme should be drawn up by the State Electricity Regulatory
Commissions (SERC) for segregation of technical and commercial losses through energy audits.
Energy accounting and declaration of its results in each defined unit, as determined by SERCs,
should be mandatory not later than March 2007. An action plan for reduction of the losses with
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adequate investments and suitable improvements in governance should be drawn up. Standards for
reliability and quality of supply as well as for loss levels shall also be specified ,from time to time,
so as to bring these in line with international practices by year 2012.
5.4.7 One of the key provisions of the Act on competition in distribution is the concept of multiple
licensees in the same area of supply through their independent distribution systems. State
Governments have full flexibility in carving out distribution zones while restructuring the
Government utilities. For grant of second and subsequent distribution licence within the area of an
incumbent distribution licensee, a revenue district, a Municipal Council for a smaller urban area or a
Municipal Corporation for a larger urban area as defined in the Article 243(Q) of Constitution of
India (74th Amendment) may be considered as the minimum area. The Government of India would
notify within three months, the requirements for compliance by applicant for second and subsequent
distribution licence as envisaged in Section 14 of the Act. With a view to provide benefits of
competition to all section of consumers, the second and subsequent licensee for distribution in the
same area shall have obligation to supply to all consumers in accordance with provisions of section
43 of the Electricity Act 2003. The SERCs are required to regulate the tariff including connection
charges to be recovered by a distribution licensee under the provisions of the Act. This will ensure
that second distribution licensee does not resort to cherry picking by demanding unreasonable
connection charges from consumers.
5.4.8 The Act mandates supply of electricity through a correct meter within a stipulated period. The
Authority should develop regulations as required under Section 55 of the Act within three months.
5.4.9 The Act requires all consumers to be metered within two years. The SERCs may obtain from
the Distribution Licensees their metering plans, approve these, and monitor the same. The SERCs
should encourage use of pre-paid meters. In the first instance, TOD meters for large consumers with
a minimum load of one MVA are also to be encouraged. The SERCs should also put in place
independent third-party meter testing arrangements.
5.4.10 Modern information technology systems may be implemented by the utilities on a priority
basis, after considering cost and benefits, to facilitate creation of network information and customer
data base which will help in management of load, improvement in quality, detection of theft and
tampering, customer information and prompt and correct billing and collection . Special emphasis
should be placed on consumer indexing and mapping in a time bound manner. Support is being
provided for information technology based systems under the Accelerated Power Development and
Reforms Programme (APDRP).
5.4.11 High Voltage Distribution System is an effective method for reduction of technical losses,
prevention of theft, improved voltage profile and better consumer service. It should be promoted to
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reduce LT/HT ratio keeping in view the techno economic considerations.
5.4.12 SCADA and data management systems are useful for efficient working of Distribution
Systems. A time bound programme for implementation of SCADA and data management system
should be obtained from Distribution Licensees and approved by the SERCs keeping in view the
techno economic considerations. Efforts should be made to install substation automation equipment
in
a
phased
manner.
5.4.13 The Act has provided for stringent measures against theft of electricity. The States and
distribution utilities should ensure effective implementation of these provisions. The State
Governments may set up Special Courts as envisaged in Section 153 of the Act.
5.5 RECOVERY OF COST OF SERVICES & TARGETTED SUBSIDIES
5.5.1 There is an urgent need for ensuring recovery of cost of service from consumers to make the
power sector sustainable.
5.5.2 A minimum level of support may be required to make the electricity affordable for consumers
of very poor category. Consumers below poverty line who consume below a specified level, say 30
units per month, may receive special support in terms of tariff which are cross-subsidized. Tariffs for
such designated group of consumers will be at least 50 % of the average (overall) cost of supply.
This
provision
will
be
further
re-examined
after
five
years.
5.5.3 Over the last few decades cross-subsidies have increased to unsustainable levels. Crosssubsidies hide inefficiencies and losses in operations. There is urgent need to correct this imbalance
without giving tariff shock to consumers. The existing cross-subsidies for other categories of
consumers would need to be reduced progressively and gradually.
5.5.4 The State Governments may give advance subsidy to the extent they consider appropriate in
terms of section 65 of the Act in which case necessary budget provision would be required to be
made in advance so that the utility does not suffer financial problems that may affect its operations.
Efforts would be made to ensure that the subsidies reach the targeted beneficiaries in the most
transparent and efficient way.
5.6 TECHNOLOGY DEVELOPMENT AND R&D
5.6.1 Effective utilization of all available resources for generation, transmission and distribution of
electricity using efficient and cost effective technologies is of paramount importance. Operations
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and management of vast and complex power systems require coordination among the multiple
agencies involved. Effective control of power system at state, regional and national level can be
achieved only through use of Information Technology. Application of IT has great potential in
reducing technical & commercial losses in distribution and providing consumer friendly services.
Integrated resource planning and demand side management would also require adopting state of the
art technologies.
Special efforts would be made for research, development demonstration and commercialization of
non-conventional energy systems. Such systems would need to meet international standards,
specifications and performance parameters.
5.6.2 Efficient technologies, like super critical technology, IGCC etc and large size units would be
gradually introduced for generation of electricity as their cost effectiveness is established.
Simultaneously, development and deployment of technologies for productive use of fly ash would
be given priority and encouragement.
5.6.3 Similarly, cost effective technologies would require to be developed for high voltage power
flows over long distances with minimum possible losses. Specific information technology tools need
to be developed for meeting the requirements of the electricity industry including highly
sophisticated control systems for complex generation and transmission operations, efficient
distribution business and user friendly consumer interface.
5.6.4 The country has a strong research and development base in the electricity sector which would
be further augmented. R&D activities would be further intensified and Missions will be constituted
for achieving desired results in identified priority areas. A suitable funding mechanism would be
evolved for promoting R& D in the Power Sector. Large power companies should set aside a portion
of their profits for support to R&D.
5.7 COMPETITION AIMED AT CONSUMER BENEFITS
5.7.1 To promote market development, a part of new generating capacities, say 15% may be sold
outside long-term PPAs . As the power markets develop, it would be feasible to finance projects
with competitive generation costs outside the long-term power purchase agreement framework. In
the coming years, a significant portion of the installed capacity of new generating stations could
participate in competitive power markets. This will increase the depth of the power markets and
provide alternatives for both generators and licensees/consumers and in long run would lead to
reduction
in
tariff.
For achieving this, the policy underscores the following:a. It is the function of the Central Electricity Regulatory Commission to issue license for inter163
state trading which would include authorization for trading throughout the country.
b. The ABT regime introduced by CERC at the national level has had a positive impact. It has
also enabled a credible settlement mechanism for intra-day power transfers from licenses
with surpluses to licenses experiencing deficits. SERCs are advised to introduce the ABT
regime at the State level within one year.
c. Captive generating plants should be permitted to sell electricity to licensees and consumers
when they are allowed open access by SERCs under section 42 of the Act .
d. Development of power market would need to be undertaken by the Appropriate Commission
in consultation with all concerned.
e. The Central Commission and the State Commissions are empowered to make regulations
under section 178 and section 181 of the Act respectively. These regulations will ensure
implementation of various provisions of the Act regarding encouragement to competition and
also consumer protection. The Regulatory Commissions are advised to notify various
regulations expeditiously.
f. Enabling regulations for inter and intra State trading and also regulations on power exchange
shall be notified by the appropriate Commissions within six months.
5.8 FINANCING POWER SECTOR PROGRAMMES INCLUDING PRIVATE SECTOR
PARTICIPATION
5.8.1 To meet the objective of rapid economic growth and “power for all” including household
electrification, it is estimated that an investment of the order of Rs.9,00,000 crores at 2002-03 price
level would be required to finance generation, transmission, sub-transmission, distribution and rural
electrification projects. Power being most crucial infrastructure, public sector investments, both at
the Central Government and State Governments, will have to be stepped up. Considering the
magnitude of the expansion of the sector required, a sizeable part of the investments will also need
to be brought in from the private sector. The Act creates a conducive environment for investments in
all segments of the industry, both for public sector and private sector, by removing barrier to entry in
different segments. Section 63 of the Act provides for participation of suppliers on competitive basis
in different segments which will further encourage private sector investment. Public service
obligations like increasing access to electricity to rural households and small and marginal farmers
have highest priority over public finances.
5.8.2 The public sector should be able to raise internal resources so as to at least meet the equity
requirement of investments even after suitable gross budgetary support from the Government at the
Centre and in the states in order to complete their on-going projects in a time-bound manner.
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Expansion of public sector investments would be dependent on the financial viability of the
proposed projects. It would, therefore, be imperative that an appropriate surplus is generated through
return on investments and, at the same time, depreciation reserve created so as to fully meet the debt
service obligation. This will not only enable financial closure but also bankability of the project
would be improved for expansion programmes, with the Central and State level public sector
organizations, as also private sector projects, being in a position to fulfil their obligations toward
equity funding and debt repayments.
5.8.3 Under sub-section (2) of Section 42 of the Act, a surcharge is to be levied by the respective
State Commissions on consumers switching to alternate supplies under open access. This is to
compensate the host distribution licensee serving such consumers who are permitted open access
under section 42(2), for loss of the cross-subsidy element built into the tariff of such consumers. An
additional surcharge may also be levied under sub-section (4) of Section 42 for meeting the fixed
cost of the distribution licensee arising out of his obligation to supply in cases where consumers are
allowed open access. The amount of surcharge and additional surcharge levied from consumers who
are permitted open access should not become so onerous that it eliminates competition that is
intended to be fostered in generation and supply of power directly to consumers through the
provision of Open Access under Section 42(2) of the Act. Further it is essential that the Surcharge be
reduced progressively in step with the reduction of cross-subsidies as foreseen in Section 42(2) of
the Electricity Act 2003.
5.8.4 Capital is scarce. Private sector will have multiple options for investments. Return on
investment will, therefore, need to be provided in a manner that the sector is able to attract adequate
investments at par with, if not in preference to, investment opportunities in other sectors. This would
obviously be based on a clear understanding and evaluation of opportunities and risks. An
appropriate balance will have to be maintained between the interests of consumers and the need for
investments.
5.8.5 All efforts will have to be made to improve the efficiency of operations in all the segments of
the industry. Suitable performance norms of operations together with incentives and disincentives
will need to be evolved along with appropriate arrangement for sharing the gains of efficient
operations with the consumers . This will ensure protection of consumers’ interests on the one hand
and provide motivation for improving the efficiency of operations on the other.
5.8.6 Competition will bring significant benefits to consumers , in which case, it is competition
which will determine the price rather than any cost plus exercise on the basis of operating norms and
parameters. All efforts will need to be made to bring the power industry to this situation as early as
possible, in the overall interest of consumers. Detailed guidelines for competitive bidding as
stipulated in section 63 of the Act have been issued by the Central Government.
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5.8.7 It will be necessary that all the generating companies, transmission licensees and distribution
licensees receive due payments for effective discharge of their operational obligations as also for
enabling them to make fresh investments needed for the expansion programmes. Financial viability
of operations and businesses would, therefore, be essential for growth and development of the
sector. Concerted efforts would be required for restoring the financial health of the sector. For this
purpose, tariff rationalization would need to be ensured by the SERCs. This would also include
differential pricing for base, intermediate and peak power.
5.8.8 Steps would also be taken to address the need for regulatory certainty based on independence
of the regulatory commissions and transparency in their functioning to generate investor’s
confidence.
5.8.9 Role of private participation in generation, transmission and distribution would become
increasingly critical in view of the rapidly growing investment needs of the sector. The Central
Government and the State Governments need to develop workable and successful models for public
private partnership. This would also enable leveraging private investment with the public sector
finances. Mechanisms for continuous dialogue with industry for streamlining procedures for
encouraging private participation in power sector need to be put in place.
Transmission & Distribution Losses
5.8.10 It would have to be clearly recognized that Power Sector will remain unviable until T&D
losses are brought down significantly and rapidly. A large number of States have been reporting
losses of over 40% in the recent years. By any standards, these are unsustainable and imply a steady
decline of power sector operations. Continuation of the present level of losses would not only pose a
threat to the power sector operations but also jeopardize the growth prospects of the economy as a
whole. No reforms can succeed in the midst of such large pilferages on a continuing basis.
The State Governments would prepare a Five Year Plan with annual milestones to bring down these
losses expeditiously. Community participation, effective enforcement, incentives for entities, staff
and consumers, and technological upgradation should form part of campaign efforts for reducing
these losses. The Central Government will provide incentive based assistance to States that are able
to reduce losses as per agreed programmes.
5.9 ENERGY CONSERVATION
5.9.1 There is a significant potential of energy savings through energy efficiency and demand side
management measures. In order to minimize the overall requirement, energy conservation and
demand side management (DSM) is being accorded high priority. The Energy Conservation Act has
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been enacted and the Bureau of Energy Efficiency has been setup.
5.9.2 The potential number of installations where demand side management and energy conservation
measures are to be carried out is very large. Bureau of Energy Efficiency (BEE) shall initiate action
in this regard. BEE would also make available the estimated conservation and DSM potential, its
staged implementation along with cost estimates for consideration in the planning process for
National Electricity Plan.
5.9.3 Periodic energy audits have been made compulsory for power intensive industries under the
Energy Conservation Act. Other industries may also be encouraged to adopt energy audits and
energy conservation measures. Energy conservation measures shall be adopted in all Government
buildings for which saving potential has been estimated to be about 30% energy. Solar water heating
systems and solar passive architecture can contribute significantly to this effort.
5.9.4 In the field of energy conservation initial approach would be voluntary and self-regulating with
emphasis on labelling of appliances. Gradually as awareness increases, a more regulatory approach
of setting standards would be followed.
5.9.5 In the agriculture sector, the pump sets and the water delivery system engineered for high
efficiency would be promoted. In the industrial sector, energy efficient technologies should be used
and energy audits carried out to indicate scope for energy conservation measures. Motors and drive
system are the major source of high consumption in Agricultural and Industrial Sector. These need
to be addressed. Energy efficient lighting technologies should also be adopted in industries,
commercial and domestic establishments.
5.9.6 In order to reduce the requirements for capacity additions, the difference between electrical
power demand during peak periods and off-peak periods would have to be reduced. Suitable load
management techniques should be adopted for this purpose. Differential tariff structure for peak and
off peak supply and metering arrangements (Time of Day metering) should be conducive to load
management objectives. Regulatory Commissions should ensure adherence to energy efficiency
standards by utilities.
5.9.7 For effective implementation of energy conservation measures, role of Energy Service
Companies would be enlarged. Steps would be taken to encourage and incentivise emergence of
such companies.
5.9.8 A national campaign for bringing about awareness about energy conservation would be
essential to achieve efficient consumption of electricity.
5.9.9. A National Action Plan has been developed. Progress on all the proposed measures will be
monitored with reference to the specific plans of action.
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5.10 ENVIRONMENTAL ISSUES
5.10.1 Environmental concerns would be suitably addressed through appropriate advance action by
way of comprehensive Environmental Impact Assessment and implementation of Environment
Action Plan (EAP).
5.10.2 Steps would be taken for coordinating the efforts for streamlining the procedures in regard to
grant of environmental clearances including setting up of ‘Land Bank’ and ‘Forest Bank’.
5.10.3 Appropriate catchment area treatment for hydro projects would also be ensured and
monitored.
5.10.4 Setting up of coal washeries will be encouraged. Suitable steps would also be taken so that
utilization of fly ash is ensured as per environmental guidelines.
5.10.5 Setting up of municipal solid waste energy projects in urban areas and recovery of energy
from industrial effluents will also be encouraged with a view to reducing environmental pollution
apart from generating additional energy.
5.10.6 Full compliance with prescribed environmental norms and standards must be achieved in
operations of all generating plants.
5.11 TRAINING AND HUMAN RESOURCE DEVELOPMENT
In the new reforms framework ushered by Electricity Act 2003, it is particularly important that the
electricity industry has access to properly trained human resource. Therefore, concerted action
would be taken for augmenting training infrastructure so that adequate well-trained human resource
is made available as per the need of the industry. Special attention would need to be paid by the
industry for establishing training infrastructure in the field of electricity distribution, regulation,
trading and power markets. Efforts should be made so that personnel of electricity supply industry
both in the private and public sector become more cost-conscious and consumer-friendly.
5.12 COGENERATION AND NON-CONVENTIONAL ENERGY SOURCES
5.12.1 Non-conventional sources of energy being the most environment friendly there is an urgent
need to promote generation of electricity based on such sources of energy. For this purpose, efforts
need to be made to reduce the capital cost of projects based on non-conventional and renewable
sources of energy. Cost of energy can also be reduced by promoting competition within such
projects. At the same time, adequate promotional measures would also have to be taken for
development of technologies and a sustained growth of these sources.
5.12.2 The Electricity Act 2003 provides that co-generation and generation of electricity from non168
conventional sources would be promoted by the SERCs by providing suitable measures for
connectivity with grid and sale of electricity to any person and also by specifying, for purchase of
electricity from such sources, a percentage of the total consumption of electricity in the area of a
distribution licensee. Such percentage for purchase of power from non-conventional sources should
be made applicable for the tariffs to be determined by the SERCs at the earliest. Progressively the
share of electricity from non-conventional sources would need to be increased as prescribed by State
Electricity Regulatory Commissions. Such purchase by distribution companies shall be through
competitive bidding process. Considering the fact that it will take some time before nonconventional technologies compete, in terms of cost, with conventional sources, the Commission
may determine an appropriate differential in prices to promote these technologies.
5.12.3 Industries in which both process heat and electricity are needed are well suited for
cogeneration of electricity. A significant potential for cogeneration exists in the country, particularly
in the sugar industry. SERCs may promote arrangements between the co-generator and the
concerned distribution licensee for purchase of surplus power from such plants. Cogeneration
system also needs to be encouraged in the overall interest of energy efficiency and also grid stability.
5.13 PROTECTION OF CONSUMER INTERESTS AND QUALITY STANDARDS
5.13.1 Appropriate Commission should regulate utilities based on pre-determined indices on quality
of power supply. Parameters should include, amongst others, frequency and duration of interruption,
voltage parameters, harmonics, transformer failure rates, waiting time for restoration of supply,
percentage defective meters and waiting list of new connections. The Appropriate Commissions
would specify expected standards of performance.
5.13.2 Reliability Index (RI) of supply of power to consumers should be indicated by the distribution
licensee. A road map for declaration of RI for all cities and towns up to the District Headquarter
towns as also for rural areas, should be drawn by up SERCs. The data of RI should be compiled and
published by CEA.
5.13.3 It is advised that all State Commissions should formulate the guidelines regarding setting up
of grievance redressal forum by the licensees as also the regulations regarding the Ombudsman and
also appoint/designate the Ombudsman within six months.
5.13.4 The Central Government, the State Governments and Electricity Regulatory Commissions
should facilitate capacity building of consumer groups and their effective representation before the
Regulatory Commissions. This will enhance the efficacy of regulatory process.
6.0 COORDINATED DEVELOPMENT
6.1 Electricity being a concurrent subject, a well-coordinated approach would be necessary for
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development of the power sector. This is essential for the attainment of the objective of providing
electricity-access to all households in next five years and providing reliable uninterrupted quality
power supply to all consumers. The State Governments have a major role, particularly in creation of
generation capacity, state level transmission and distribution. The Central Government would assist
the States in the attainment of this objective. It would be playing a supportive role in fresh capacity
addition and a major role in development of the National Grid. The State Governments need to
ensure the success of reforms and restoration of financial health in distribution, which alone can
enable the creation of requisite generation capacity. The Regulatory Commissions have the
responsibility of ensuring that the regulatory processes facilitate the attainment of this objective.
They also have a developmental role whose fulfillment would need a less formal and a consultative
process.
The Electricity Act, 2003 also provides for mechanisms like “Coordination forum” and “Advisory
Committees” to facilitate consultative process. The Act also requires the Regulatory Commissions to
ensure transparency in exercise of their powers and in discharge of their functions. This in no way
means that the Regulatory Commissions should follow formal judicial approach. In fact, quick
disposal of matters would require an approach involving consultations with stakeholders.
6.2 Under the Act, the Regulatory Commissions are required to perform wide-ranging
responsibilities. The appropriate Governments need to take steps to attract regulatory personnel with
required background. The Govt. of India would promote the institutional capability to provide
training to raise regulatory capacity in terms of the required expertise and skill sets. The appropriate
Governments should provide financial autonomy to the Regulatory Commissions. The Act provides
that the appropriate Government shall constitute a Fund under section 99 or section 103 of the Act,
as the case may be, to be called as Regulatory Commission Fund. The State Governments are
advised to establish this Fund expeditiously.
(Ajay Shankar)
Additional Secretary to the Government of India
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CERC (Terms & Condition of tariff) Regulations, 2004 (26.03.2004) and (1st
Amendment) Regulations, 2004 dated 3rd September, 2004
Central Electricity Regulatory Commission
th
Core 3, 7 Floor, Scope Complex, New Delhi – 110 003.
(Tele No. 24364911 FAX No. 24360010)
th
No. L-7/25(5)/2003-CERC 26 March 2004
In exercise of powers conferred under Section 178 of the Electricity Act, 2003, and
all other powers enabling in this behalf, and after previous publication, the Central
Electricity Regulatory Commission hereby makes the following regulations, namely:
CHAPTER 1
PRELIMINARY
1. Short title and commencement: (1) These regulations may be called the Central
Electricity Regulatory Commission (Terms and Conditions of Tariff) Regulations, 2004.
(2) These regulations shall come into force on 1.4.2004, and unless reviewed earlier
or extended by the Commission, shall remain in force for a period of 5 years.
Provided that where a project, including a part thereof, has been commissioned
before the date of commencement of these regulations and whose tariff has not been
finally determined by the Commission till that date, tariff in respect of such a project or part
thereof, as the case may be, for the period ending 31.3.2004 shall be determined in
accordance with the Central Electricity Regulatory Commission (Terms & Conditions of
Tariff) Regulations, 2001.
(3) Words and expressions used in these regulations and not defined herein but
defined in the Act shall have the meaning assigned to them under the Act.
2. Scope and extent of application: (1) Where tariff has been determined through
transparent process of bidding in accordance with the guidelines issued by the Central
Government, the Commission shall adopt such tariff in accordance with the provisions of
the Act.
(2) These regulations shall apply in all other cases where tariff is to be determined by the
Commission based on capital cost.
Provided that the Commission may prescribe the relaxed norms of operation,
including the norms of target availability and Plant Load Factor contained in these
regulations for a generating station the tariff of which is not determined in accordance with
the Central Electricity Regulatory Commission (Terms and Conditions of Tariff)
Regulations, 2001, and the relaxed norms shall be applicable for determination of tariff for
such a generating station.
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1
Norms of operation to be ceiling norms: For removal of doubts, it is clarified that the
norms of operation specified under these regulations are the ceiling norms and this shall
not preclude the generating company or the transmission licensee, as the case may be,
and the beneficiaries from agreeing to improved norms of operation and in case the
improved norms are agreed to, such improved norms shall be applicable for determination
of tariff.
2
Tariff determination: (1) Tariff in respect of a generating station under these
regulations shall be determined stage-wise, unit-wise or for the whole generating station
and tariff for the transmission system shall be determined line-wise, sub-station-wise and
system-wise, as the case may be, and aggregated to regional tariff.
(2) For the purpose of tariff, the capital cost of the project shall be broken up into stages
and by distinct units forming part of the project. Where the stage-wise, unit-wise, line-wise
or sub-station-wise break up of the capital cost of the project is not available and in case of
on-going projects, the common facilities shall be apportioned on the basis of the installed
capacity of the units and lines or sub-stations. In relation to multipurpose hydro electric
projects, with irrigation, flood control and power components, the capital cost chargeable to
the power component of the project only shall be considered for determination of tariff.
Explanation
For the purpose of this chapter, 'project' includes a generating station and the
transmission system.
5. Application for determination of tariff: (1) The generating company or the transmission
licensee, as the case may be, may make an application for fixation of tariff in respect of the
completed units of the generating station or the lines or sub-stations of the transmission
system.
(2) In case of the existing generating station or the existing transmission system, the
generating company or the transmission licensee, as the case may be, shall make an
application for determination of tariff as per Appendix I to these regulations.
(3) In case of a generating station or the transmission system declared under
commercial operation on or after 1.4.2004, an application for fixation of tariff shall be made
in two stages, namely:
(i) A generating company or a transmission licensee may make an application as per
Appendix I to these regulations, for determination of provisional tariff in advance of the
anticipated date of completion of the project based on the capital expenditure actually
incurred up to the date of making of the application or a date prior to making of the
application, duly audited and certified by the statutory auditors, and the provisional tariff
shall be charged from the date of commercial operation of the respective unit of the
generating station or the line or sub-station of the transmission system;
(ii) A generating company or the transmission licensee shall make a fresh
application as per Appendix I to these regulations, for determination of final tariff based on
actual capital expenditure incurred up to the date of commercial operation of the generating
station or the transmission system, duly audited and certified by the statutory auditors.
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1
Core Business : For the purpose of these regulations, core business means the
regulated activities of generation or transmission of electricity and does not include any
other business or activity, like consultancy, telecommunication, of the generating company
or the transmission licensee.
2
Tax on Income: (1) Tax on the income streams of the generating company or the
transmission licensee, as the case may be, from its core business, shall be computed as
an expense and shall be recovered from the beneficiaries.
(2) Any under-recoveries or over-recoveries of tax on income shall be adjusted every year
on the basis of income-tax assessment under the Income-Tax Act, 1961, as certified by the
statutory auditors.
Provided that tax on any income stream other than the core business shall not
constitute a pass through component in tariff and tax on such other income shall be
payable by the generating company or transmission licensee, as the case may be.
Provided further that the generating station-wise profit before tax in the case of the
generating company and the region-wise profit before tax in case of the transmission
licensee as estimated for a year in advance shall constitute the basis for distribution of the
corporate tax liability to all the generating stations and regions.
Provided further that the benefits of tax-holiday as applicable in accordance with the
provisions of the Income-Tax Act, 1961 shall be passed on to the beneficiaries.
Provided further that in the absence of any other equitable basis the credit for carry
forward losses and unabsorbed depreciation shall be given in the proportion as provided in
the second proviso to this regulation.
Provided further that income-tax allocated to the thermal generating station shall be
charged to the beneficiaries in the same proportion as annual fixed charges, the incometax allocated to the hydro generating station shall be charged to the beneficiaries in the
same proportion as annual capacity charges and in case of interstate transmission, the
sharing of income-tax shall be in the same proportion as annual transmission charges.
8. Tax Escrow Mechanism: (1) The beneficiaries shall maintain an interest-bearing tax
escrow account in a scheduled bank, to which all amounts of interest shall be credited .
(2) The tax liability shall be estimated two months before the commencement of
each year and intimated to the beneficiaries. The generating company or the transmission
licensee shall endeavour to minimize its liability on account of taxes recoverable
from the beneficiaries.
(3) The generating company or the transmission licensee shall be authorised to
withdraw the amounts for settling the income-tax liability on presentation to the escrow
holder, a certificate from their statutory auditors that the amounts are immediately due and
payable to the taxing authority.
(4) The generating company or the transmission licensee shall pay into the tax
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escrow account any refund received from the taxing authority.
(5) The refunds, if any, shall not be paid back to the beneficiaries and shall be
adjusted in the escrow account. Any balance due or returnable shall be rolled over to the
next year.
(6) The escrow accounts shall be reflected in the books of accounts of the
beneficiaries as their bank account.
1
Extra Rupee Liability: (1) Extra rupee liability towards interest payment and loan
repayment corresponding to the normative foreign debt or actual foreign debt, as the case
may be, in the relevant year shall be permissible provided it directly arises out of Foreign
Exchange Rate Variation and is not attributable to the generating company or the
transmission licensee or its suppliers or contractors. Every generating company and the
transmission licensee shall recover Foreign Exchange Rate Variation on a year to year
basis as income or expense in the period in which it arises and Foreign Exchange Rate
Variation shall be adjusted on a year to year basis.
10. Recovery of Income-tax and Foreign Exchange Rate Variation: Recovery of Incometax and Foreign Exchange Rate Variation shall be done directly by the generating company
or the transmission licensee, as the case may be, from the beneficiaries without making
any application before the Commission.
Provided that in case of any objections by the beneficiaries to the amounts claimed
on account of income-tax or Foreign Exchange Rate Variation, the generating company or
the transmission licensee, as the case may be, may make an appropriate application
before the Commission for its decision.
11. Deviation from norms: (1) Tariff for sale of electricity by a generating company
may also be determined in deviation of the norms specified in these regulations subject to
the conditions that:
(a) The overall per unit tariff of electricity over the entire life of the asset, calculated
on the basis of the norms in deviation does not exceed the per unit tariff calculated on the
basis of the norms specified in these regulations; and
(b) Any such deviation shall come into effect only after approval by the Commission.
(2) In case of the existing generating stations, TPS-I and TPS-II (Stage I & II) of
Neyveli Lignite Corporation Ltd, whose tariff was initially determined by following Net Fixed
Assets approach based on mutual agreement between Neyveli Lignite Corporation Ltd and
the beneficiaries, tariff shall continue to be determined by adopting Net Fixed Assets
approach.
1
Power to Remove Difficulties: If any difficulty arises in giving effect to these
regulations, the Commission may, of its own motion or otherwise, by an order and after
giving a reasonable opportunity to those likely to be affected by such order, make such
provisions, not inconsistent with these regulations, as may appear to be necessary for
removing the difficulty.
2
Power to Relax: The Commission, for reasons to be recorded in writing, may vary any
of the provisions of these regulations on its own motion or on an application made before it
by an interested person.
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CHAPTER 2
THERMAL POWER GENERATING STATIONS
14. Definitions: Unless the context otherwise requires, for the purpose of this chapter, :
(i) ‘Act’ means the Electricity Act, 2003;
(ii) `Additional Capitalisation' means the capital expenditure actually incurred after the
date of commercial operation of the generating station and admitted by the Commission
after prudence check subject to provisions of regulation 18;
(iii) ‘Authority ' means Central Electricity Authority referred to in Section 70 of the
Act;
(iv) 'Auxiliary Energy Consumption' or 'AUX' in relation to a period means the quantum
of energy consumed by auxiliary equipment of the generating station and transformer
losses within the generating station, and shall be expressed as a percentage of the sum of
gross energy generated at the generator terminals of all the units of the generating station;
(v) 'Availability' in relation to a thermal generating station for any period means the
average of the daily average declared capacities (DCs) for all the days during that period
expressed as a percentage of the installed capacity of the generating station minus
normative auxiliary consumption in MW, and shall be computed in accordance with the
following formula:
N
Availability = 10000 x
Σ DCi/ { N x IC x (100-AUXn) }% i=1
where,
IC = Installed Capacity of the generating station in MW,
th
DCi = Average declared capacity for the i day of the period in MW,
N = Number of days during the period, and
AUXn = Normative Auxiliary Energy Consumption as a percentage of gross generation;
(vi) ‘Beneficiary’ in relation to a generating station means the person buying power
generated at such a generating station on payment of Annual Fixed Charges;
(vii) ‘Block’ in relation to a combined cycle thermal generating station includes combustion
turbine – generator(s), associated waste heat recovery boiler(s), connected steam turbine –
generator and auxiliaries;
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(viii) 'Commission' means the Central Electricity Regulatory Commission referred to in Section
76 of the Act;
(ix) ‘Cut off Date’ means the date of first financial year closing after one year of the date of
commercial operation of the generating station;
(x) ‘Date of Commercial Operation’ or ‘COD’ in relation to a unit means the date declared by
the generator after demonstrating the Maximum Continuous Rating (MCR) or Installed Capacity
(IC) through a successful trial run after notice to the beneficiaries and in relation to the
generating station the date of commercial operation means the date of commercial operation of
the last unit or block of the generating station;
(xi) ‘Declared Capacity’ or ‘DC' means the capability of the generating station to deliver exbus electricity in MW declared by such generating station in relation to any period of the day or
whole of the day, duly taking into account the availability of fuel;
Note
In case of a gas turbine generating station or a combined cycle generating station, the
generating station shall declare the capacity for units and modules on gas fuel and liquid
fuel separately, and these shall be scheduled separately. Total declared capacity and
total scheduled generation for the generating station shall be the sum of the declared
capacity and scheduled generation for gas fuel and liquid fuel for the purpose of
computation of availability and Plant Load Factor respectively.
(xii) `Existing Generating Station' means a generating station declared under commercial
operation from a date prior to 1.4.2004;
(xiii) ‘Gross Calorific Value’ or ‘GCV’ in relation to a thermal power generating station
means the heat produced in kCal by complete combustion of one kilogram of solid fuel or
one litre of liquid fuel or one standard cubic meter of gaseous fuel, as the case may be;
(xiv) ‘Gross Station Heat Rate’ or ‘GHR’ means the heat energy input in kCal required to
generate one kWh of electrical energy at generator terminals;
(xv) ‘Infirm Power’ means electricity generated prior to commercial operation of the unit of
a generating station;
(xvi) ‘Installed Capacity' or 'IC’ means the summation of the name plate capacities of all
the units of the generating station or the capacity of the generating station (reckoned at
the generator terminals) as approved by the Commission from time to time;
(xvii) ‘Maximum Continuous Rating' or `MCR’ in relation to a unit of the thermal
power generating station means the maximum continuous output at the generator
terminals, guaranteed by the manufacturer at rated parameters, and in relation to
a unit or block of a combined cycle thermal power generating station means the
maximum continuous output at the generator terminals, guaranteed by the
manufacturer with water/steam injection (if applicable) and corrected to 50 Hz grid
176
frequency and specified site conditions;
(xviii) 'Operation and Maintenance Expenses’ or ‘O&M Expenses' means the
expenditure incurred on operation and maintenance of the generating station,
including part thereof, and includes the expenditure on manpower, repairs, spares,
consumables, insurance and overheads;
(xix) `Original Project Cost' means the actual expenditure incurred by the
generating company, as per the original scope of the project up to the first financial
year closing after one year of the date of commercial operation of the last unit as
admitted by the Commission for determination of tariff;
(xx) 'Plant Load Factor' or 'PLF' for a given period, means the total sent out energy
corresponding to scheduled generation during the period, expressed as a
percentage of sent out energy corresponding to installed capacity in that period
and shall be computed in accordance with the following formula:
N
PLF = 10000 x Σ SGi/
where,
{N x IC x (100-AUX ) }% i=1
n
IC = Installed Capacity of the generating station in MW,
th
SGi = Scheduled Generation in MW for the i time block of the period,
N = Number of time blocks during the period, and
AUXn = Normative Auxiliary Energy Consumption as a percentage of gross generation;
(xxi) ‘Project’ means a generating station;
(xxii) `Scheduled Generation’ or ‘SG' at any time or for any period or time block
means schedule of generation in MW ex-bus given by the Regional Load
Despatch Centre;
Note
For the gas turbine generating station or a combined cycle generating station if the
average frequency for any time block, is below 49.52 Hz but not below 49.02 Hz
and the scheduled generation is more than 98.5% of the declared capacity, the
scheduled generation shall be deemed to have been reduced to 98.5% of the
declared capacity, and if the average frequency for any time block is below 49.02
Hz and the scheduled generation is more than 96.5% of the declared capacity, the
scheduled generation shall be deemed to have been reduced to 96.5% of the
declared capacity.
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(xxiii) `Small Gas Turbine Power Generating Station' means and includes gas
turbine/combined cycle generating stations with gas turbines in the capacity range
of 50 MW or below;
(xxiv) 'Unit' in relation to a thermal power generating station means steam
generator, turbine-generator and auxiliaries, or in relation to a combined cycle
thermal power generating station, means turbine-generator and auxiliaries; and
(xxv) ‘Year’ means a financial year.
15. Components of Tariff: (1) Tariff for sale of electricity from a thermal power generating
station shall comprise of two parts, namely, the recovery of annual capacity (fixed)
charges and energy (variable) charges.
(2)
The annual capacity (fixed) charges shall consist of:
(a)
Interest on loan capital;
(b)
Depreciation, including Advance Against Depreciation;
(c) Return on equity;
(d)
Operation and maintenance expenses; and
(e)
Interest on working capital.
(3)
The energy (variable) charges shall cover fuel cost.
16.
Norms of Operation: The norms of operation as given hereunder shall apply:
(i) Target Availability for recovery of full Capacity (Fixed) charges
(a)
All thermal power generating stations, except those covered under clauses (b)
and (c) below - 80%
(b)
Thermal power generating stations of Neyveli Lignite Corporation Ltd (TPS-I, TPS-II,
Stage I&II and TPS-I Expansion) and Talchar Thermal Power Station of National Thermal Power
Corporation Ltd. - 75%
(c )
Tanda Thermal Power Station of National Thermal Power Corporation Ltd.
60%
-
Note
Recovery of capacity (fixed) charges below the level of target availability shall be on
pro rata basis. At zero availability, no capacity charges shall be payable.
(ii)
Target Plant Load Factor for Incentive
(a)
All thermal power generating stations, except those covered under
clauses (b) and (c) below - 80%
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(b)
Thermal power generating stations of Neyveli Lignite Corporation Ltd (TPS-I,
TPS-II, Stage I&II and TPS I Expansion) and Talcher Thermal Power Station of National
Thermal Power Corporation Ltd. - 75%
(c) Tanda Thermal Power Station of National Thermal Power Corporation Ltd.
-60%
(iii)
Gross Station Heat Rate
(a)
Coal-based thermal power generating stations, other than those
covered under clauses (b) and (c) below
200/210/250 MW sets 500 MW and above sets
During stabilization period 2600 KCal/kWh 2550 KCal/kWh
Subsequent period 2500 KCal/kWh 2450 KCal/kWh
Note 1
In respect of 500 MW and above units where the boiler feed pumps are
electrically operated, the gross station heat rate shall be 40 kCal/kWh lower
than the station heat rate indicated above.
Note 2
For generating stations having combination of 200/210/250 MW sets and 500
MW and above sets, the normative gross station heat rate shall be the
weighted average station heat rate.
(b) Talcher Thermal Power Station
3100 kCal/kWh
(c) Tanda Thermal Power Station
3000 kCal/kWh
(d) Lignite-fired thermal power generating stations
(1) For lignite-fired generating stations except for TPS-I and TPS-II (Stage I &
II) of Neyveli Lignite Corporation Ltd, the gross station heat rates specified under
clause (a) above for coal-based thermal power generating stations shall be
corrected, using multiplying factors as given below:
(i)
For lignite having 50% moisture: Multiplying factor of 1.10
(ii)
For lignite having 40% moisture: Multiplying factor of 1.07
(iii)
For lignite having 30% moisture: Multiplying factor of 1.04
(iv)
For other values of moisture content, multiplying factor shall be prorated for moisture content between 30-40 and 40-50 depending upon the rated
values of multiplying factor for the respective range given under sub-clauses (i) to
(iii) above.
(2) TPS-I and TPS-II (Stage I & II) of Neveli Lignite Corporation Ltd
179
TPS-I 3900 kCal/kWh TPS-II 2850 kCal/kWh
(e)
Gas Turbine/Combined Cycle generating stations
(i)
Existing generating stations owned by National Thermal Power
Corporation Ltd
(ii) Generating stations declared under commercial operation on or after
1.4.2004
Name of Generating
station
Gandhar GPS
Kawas GPS
Anta GPS
Dadri GPS
Auraiya GPS
Faridabad GPS
Kayamkulam GPS
Combined cycle
(kCal/kWh)
Open cycle
(kCal/kWh)
2000
2075
2075
2075
2100
2000
2000
2900
3010
3010
3010
3045
2900
2900
Advanced Class E/EA/EC/E2 Class Machines
Machines
Open cycle -2685 kCal/kWh 2830 kCal/kWh Combined cycle 1850 kCal/kWh 1950 kCal/kWh
(iii) Small Gas Turbine Power Generating Stations:
(a) Assam Gas Based Power Station, Kathalguri:
Open Cycle --3225 kCal/kWh Combined Cycle --2250 kCal/kWh
(b) Agartala Gas Based Power Station, Ramachandranagar: Open Cycle -3580 kCal/kWh
(c) Other than (a) and (b) above:
With Natural Gas With Liquid Fuel
Open Cycle 3125 kCal/kWh 1.02 x 3125 kCal/kWh Combined
Cycle 2030 kCal/kWh 1.02 x 2030 kCal/kWh
(iv) Secondary fuel oil consumption
180
(a) Coal-based generating stations:
(i) All coal-based thermal power generating
stations except those covered under sub-clauses (ii) and (iii) below
During Stabilization period Subsequent period
4.5 ml/kWh
2.0 ml/kWh (ii)Talcher Thermal Power Station
3.5 ml/kWh
(iii) Tanda Thermal Power Station 3.5 ml/kWh
(b) Lignite-fired generating stations:
During Stabilization period Subsequent period
5.0 ml/kWh
(a)
3.0 ml/kWh
(v) Auxiliary Energy Consumption
Coal-based generating stations:
With cooling Without cooling
tower tower
(i) 200 MW series 9.0% 8.5%
(ii) 500 MW series Steam driven boiler feed pumps 7.5% 7.0% Electrically
driven boiler feed pumps 9.0% 8.5%
(iii) Talcher Thermal Power Station 11.0%
(iv) Tanda Thermal Power Station 11.0%
(b)
Gas Turbine/Combined Cycle generating stations:
(i)
Combined cycle 3.0%
(ii)
Open cycle 1.0%
(c) Lignite-fired thermal power generating stations:
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(i)
All generating stations, except TPS-I and TPS-II (Stage I & II) of
Neyveli Lignite Corporation Ltd:
The auxiliary energy consumption norms shall be 0.5
percentage point more than the above auxiliary energy
consumption norms of coal-based generating stations at (v)
(a) (i) & (ii) above.
(ii)
TPS-I & TPS-II Stage-I&II of Neyveli Lignite Corporation Ltd.:
TPS-I 12.0% TPS-II 10.0%
Note
During stabilization period, normative auxiliary consumption shall be reckoned at
0.5 percentage point more than the norms indicated at (a),
(b) and (c) above.
(vi)
Stabilization period
In relation to a unit, stabilization period shall be reckoned commencing from
the date of commercial operation of that unit as follows, namely:
(a) Coal-based and lignite-fired generating stations -180 days
(b) Gas turbine/combined cycle generating stations -90 days
Note
The stabilization period and relaxed norms applicable during the stabilization period shall
cease to apply from 1.4.2006.
17. Capital Cost: Subject to prudence check by the Commission, the actual expenditure incurred
on completion of the project shall form the basis for determination of final tariff. The final tariff
shall be determined based on the admitted capital expenditure actually incurred up to the date of
commercial operation of the generating station and shall include capitalised initial spares subject
to following ceiling norms as a percentage of the original project cost as on the cut off date:
(i) Coal-based/lignite-fired generating stations -2.5%
(ii) Gas Turbine/Combined Cycle generating stations -4.0%
Provided that where the power purchase agreement entered into between the generating
company and the beneficiaries provides a ceiling of actual expenditure, the capital expenditure
182
shall not exceed such ceiling for determination of tariff;
Provided further that in case of the existing generating stations, the capital cost admitted
by the Commission prior to 1.4.2004 shall form the basis for determination of tariff.
Note
Scrutiny of the project cost estimates by the Commission shall be limited to the
reasonableness of the capital cost, financing plan, interest during construction, use of efficient
technology, and such other matters for determination of tariff.
18. Additional capitalisation: (1) The following capital expenditure within the original scope of
work actually incurred after the date of commercial operation and up to the cut off date may be
admitted by the Commission, subject to prudence check:
(i) Deferred liabilities;
(ii) Works deferred for execution;
(iii) Procurement of initial capital spares in the original scope of work, subject to ceiling
specified in regulation 17;
(iv) Liabilities to meet award of arbitration or for compliance of the order or decree of a
court; and
(v)
On account of change in law.
Provided that original scope of work along with estimates of expenditure shall be
submitted along with the application for provisional tariff.
Provided further that a list of the deferred liabilities and works deferred for
execution shall be submitted along with the application for final tariff after the date
of commercial operation of the generating station.
(2) Subject to the provisions of clause (3) of this regulation, the capital expenditure of the
following nature actually incurred after the cut off date may be admitted by the Commission,
subject to prudence check:
(i)
Deferred liabilities relating to works/services within the original scope of work;
(ii)
Liabilities to meet award of arbitration or for compliance of the order or decree of a
court;
(iii)
On account of change in law;
(iv)
Any additional works/services which have become necessary for efficient and
successful operation of the generating station, but not included in the original project cost; and
(v)
Deferred works relating to ash pond or ash handling system in the original scope
of work.
(3) Any expenditure on minor items/assets like normal tools and tackles, personal
computers, furniture, air-conditioners, voltage stabilizers, refrigerators, fans, coolers, TV,
washing machines, heat-convectors, carpets, mattresses etc. brought after the cut off date shall
not be considered for additional capitalisation for determination of tariff with effect from 1.4.2004.
183
Note
The list of items is illustrative and not exhaustive.
(4) Impact of additional capitalisation in tariff revision may be considered by the Commission
twice in a tariff period, including revision of tariff after the cut off date.
Note 1
Any expenditure admitted on account of committed liabilities within the original scope of
work and the expenditure deferred on techno-economic grounds but falling within the original
scope of work shall be serviced in the normative debt-equity ratio specified in regulation 20.
Note 2
Any expenditure on replacement of old assets shall be considered after writing off the
gross value of the original assets from the original project cost, except such items as are listed
in clause (3) of this regulation.
Note 3
Any expenditure admitted by the Commission for determination of tariff on account of
new works not in the original scope of work shall be serviced in the normative debt-equity ratio
specified in regulation 20.
Note 4
Any expenditure admitted by the Commission for determination of tariff on renovation
and modernization and life extension shall be serviced on normative debt-equity ratio specified
in regulation 20 after writing off the original amount of the replaced assets from the original
project cost.
1
Sale of Infirm Power: Any revenue (other than the recovery of fuel cost) earned by the
generating company from sale of infirm power, shall be taken as reduction in capital cost and
shall not be treated as revenue.
2
Debt-Equity Ratio: (1) In case of all generating stations, debt–equity ratio as on the date
of commercial operation shall be 70:30 for determination of tariff. Where equity employed is
more than 30%, the amount of equity for determination of tariff shall be limited to 30% and the
balance amount shall be considered as the normative loan.
Provided that in case of a generating station where actual equity employed is less than
184
30%, the actual debt and equity shall be considered for determination of tariff.
(2) The debt and equity amount arrived at in accordance with clause (1) shall be used for
calculating interest on loan, return on equity, Advance Against Depreciation and Foreign
Exchange Rate Variation.
21. Computation of Capacity (Fixed) Charges: (1) The capacity charges shall be computed on
the following basis and their recovery shall be related to target availability.
(i) Interest on loan capital
(a) Interest on loan capital shall be computed loan wise on the loans arrived at in the
manner indicated in regulation 20.
(b) The loan outstanding as on 1.4.2004 shall be worked out as the gross loan as per
regulation 20 minus cumulative repayment as admitted by the Commission up to 31.3.2004.
The repayment for the period 2004-09 shall be worked out on a normative basis.
(c) The generating company shall make every effort to swap the loan as long as it results
in net benefit to the beneficiaries. The costs associated with such swapping shall be borne by
the beneficiaries.
(d) The changes to the loan terms and conditions shall be reflected from the date of such
swapping and benefit passed on to the beneficiaries.
(e) In case of any dispute, any of the parties may approach the Commission with proper
application. However, the beneficiaries shall not withhold any payment as ordered by the
Commission to the generating company during pendency of any dispute relating to swapping of
loan.
(f) In case any moratorium period is availed of by the generating company, depreciation
provided for in the tariff during the years of moratorium shall be treated as repayment during
those years and interest on loan capital shall be calculated accordingly.
(g) The generating company shall not make any profit on account of swapping of loan
and interest on loan.
(ii) Depreciation, including Advance Against Depreciation
(a) Depreciation
For the purpose of tariff, depreciation shall be computed in the following
manner, namely:
(i) The value base for the purpose of depreciation shall be the historical cost of the asset;
(ii) Depreciation shall be calculated annually, based on straight line method over the useful
life of the asset and at the rates prescribed in Appendix II to these regulations.
185
The residual life of the asset shall be considered as 10% and depreciation shall be allowed
up to maximum of 90% of the historical capital cost of the asset. Land is not a depreciable asset
and its cost shall be excluded from the capital cost while computing 90% of the historical cost of
the asset. The historical capital cost of the asset shall include additional capitalisation on account
of Foreign Exchange Rate Variation up to 31.3.2004 already allowed by the Central Government
/Commission.
(iii) On repayment of entire loan, the remaining depreciable value shall be
spread over the balance useful life of the asset.
(iv) Depreciation shall be chargeable from the first year of operation. In case
of operation of the asset for part of the year, depreciation shall be charged on
pro rata basis.
(b) Advance Against Depreciation
In addition to allowable depreciation, the generating
company shall be entitled to Advance Against Depreciation,
computed in the manner given hereunder:
AAD = Loan repayment amount as per regulation 21 (i) subject to a
th
ceiling of 1/10 of loan amount as per regulation 20 minus
depreciation as per schedule
Provided that Advance Against Depreciation shall be
permitted only if the cumulative repayment up to a particular
year exceeds the cumulative depreciation up to that year;
Provided further that Advance Against Depreciation in a year
shall be restricted to the extent of difference between cumulative
repayment and cumulative depreciation up to that year.
(iii) Return
Equity:
o
n
on
R
e
t
u
r
n
e
q
u
i
t
y
s
186
h
a
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a
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e
b
e
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o
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e
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2
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187
m
.
up to the prescribed limit in the
same currency and the
payment on this account shall
be made in Indian Rupees
based on the exchange rate
prevailing on the due date of
billing.
Provided
that
equity
invested in foreign
currency shall be
allowed a return
Explanation
The premium raised by the generating company while issuing share capital and
investment of internal resources created out of free reserve of the generating company, if
any, for the funding of the project, shall also be reckoned as paid up capital for the
purpose of computing return on equity, provided such premium amount and internal
resources are actually utilised for meeting the capital expenditure of the generating
station and forms part of the approved financial package.
(iv) Operation and Maintenance expenses
Normative operation and maintenance expenses shall be as follows, namely:
(a) Coal-based generating stations except Talcher Thermal Power
Station and Tanda Thermal Power Station of National Thermal Power
Corporation Ltd
(Rs. in lakh/MW)
Year
2004-05
2005-06
2006-07
2007-08
2008-09
200/210/250 MW sets
10.40
10.82
11.25
11.70
12.17
500 MW and above sets
9.36
9.73
10.12
10.52
10.95
188
Note
For the generating stations having combination of 200/210/250 MW sets and 500
MW and above set, the weighted average value for operation and maintenance
expenses shall be adopted.
(b) (i) Talcher Thermal Power Station
The base operation and maintenance expenses including insurance, for
the year 2000-01 shall be derived by averaging the actual operation and
maintenance expenses for the years 1998-99 to 2002-03 based on the audited
balance sheets and by excluding abnormal operation and maintenance
expenses, if any, after a prudence check by the Commission.
The average of such normalised operation and maintenance expenses,
after prudence check, for the years 1998-99 to 2002-03 considered as
operation and maintenance expenses for the year 2000-01 shall be escalated
at the rate of 4% per annum to arrive at operation and maintenance expenses
for the base year 2003-04.
The operation and maintenance expenses for the base year 200304
shall be escalated further at the rate of 4% per annum to arrive at permissible
operation and maintenance expenses for the relevant year of tariff period.
(ii) Tanda Thermal Power Station
The base operation and maintenance expenses including insurance, for
the year 2001-02 shall be derived by averaging the actual operation and
maintenance expenses for the years 2000-01 to 2002-03 based on the audited
balance sheets and by excluding abnormal operation and maintenance
expenses, if any, after a prudence check by the Commission.
The average of such normalised operation and maintenance expenses,
after prudence check, for the years 2000-01 to 2002-03 considered as
operation and maintenance expenses for the year 2001-02 shall be escalated
at the rate of 4% per annum to arrive at operation and maintenance expenses
for the base year 2003-04.
The operation and maintenance expenses for the base year 2003-04 shall be
escalated further at the rate of 4% per annum to arrive at permissible
operation and maintenance expenses for the relevant year of tariff period.
(c) Gas Turbine/Combined Cycle generating stations (Rs. in lakh/MW)
(d) Lignite-fired generating stations (Rs. in lakh/MW)
(v)
Interest on Working Capital
(a) Working capital shall cover:
189
Gas Turbine/Combined Cycle generating
stations other than small gas turbine power
Year
2004-05
2005-06
2006-07
2007-08
2008-09
Year
2004-05
2005-06
2006-07
2007-08
2008-09
generating stations
With warranty spares of Without warranty
10 years
spares
5.20
7.80
5.41
8.11
5.62
8.44
5.85
8.77
6.08
9.12
200/210/250 MW
series
10.40
10.82
11.25
11.70
12.17
Small gas turbine
power generating
stations
Without warranty
spares
9.46
9.84
10.24
10.65
11.07
TPS-I of NLC
15.20
15.81
16.44
17.10
17.78
Coal based/Lignite-fired generating stations
(i)
Cost of coal or lignite for 1½ months for pit-head generating stations
and two months for non-pit-head generating stations, corresponding to the target
availability;
(ii)
Cost of secondary fuel oil for two months corresponding to the target
availability;
(iii)
Operation and Maintenance expenses for one month;
(iv)
Maintenance spares @ 1% of the historical cost escalated @ 6% per
annum from the date of commercial operation; and
(v)
Receivables equivalent to two months of fixed and variable charges for
sale of electricity calculated on the target availability.
Gas Turbine/Combined Cycle generating stations
(i)
Fuel cost for one month corresponding to the target availability duly
taking into account the mode of operation of the generating station on gas fuel and
liquid fuel;
(ii)
Liquid fuel stock for ½ month;
(iii)
Operation and maintenance expenses for one month;
190
(iv)
Maintenance spares at 1% of the historical cost escalated @ 6% per
annum from the date of commercial operation ; and
(v)
Receivables equivalent to two months of fixed and variable charges for
sale of electricity calculated on target availability.
(b) Rate of interest on working capital shall be on normative basis and shall be equal
to the short-term Prime Lending Rate of State Bank of India as on 1.4.2004 or on 1
st
April of the year in which the generating station or a unit thereof is declared under
commercial operation, whichever is later. Interest on working capital shall be payable
on normative basis notwithstanding that the generating company has not taken
working capital loan from any outside agency.
(2) Full capacity charges shall be recoverable at target availability specified in
regulation 16. Recovery of capacity (fixed) charges below the level of target
availability shall be on pro rata basis. At zero availability, no capacity charges shall
be payable.
(3) The payment of capacity charges shall be on monthly basis in proportion to
the allocated capacity.
22. Energy Charges:
(i) Generating stations covered under ABT
Energy (variable) Charges shall cover fuel costs and shall be worked out on
the basis of ex-bus energy scheduled to be sent out from the generating
station as per the following formula:
Energy Charges (Rs) = Rate of Energy Charges in Rs/kWh X
Scheduled Energy (ex-bus) for the month in kWh corresponding to
scheduled generation.
(ii) Generating stations other than those covered under ABT
Energy (variable) charges shall cover fuel costs and shall be worked out on
the
basis of ex-bus energy delivered / sent out from the generating station as per
the
following formula:
Energy Charges (Rs) = Rate of Energy Charges in Rs/kWh X Energy
delivered (ex-bus) for the month in kWh
Where,
Rate of Energy Charges (REC) shall be the sum of the cost of
normative quantities of primary and secondary fuel for delivering ex-bus
191
one kWh of electricity in Rs/kWh and shall be computed as under:
100{Pp x (Qp)n + Ps x (Qs)n }REC =
Where,
Pp =
(Rs/kWh)
(100-(AUXn) )
Price of primary fuel namely coal or lignite or gas or liquid fuel in Rs/Kg or
Rs/cum or Rs./litre, as the case may be.
(Qp)n = Quantity of primary fuel required for generation of one
kWh of electricity at generator terminals in Kg or
litre or cum, as the case may be, and shall be
computed on the basis of normative Gross Station
Heat Rate (less heat contributed by secondary fuel
oil for coal/lignite based generating stations) and
gross
calorific value of coal/lignite or gas or
liquid fuel as fired. Ps = Price of
Secondary fuel oil in Rs./ml, (Qs)n =
Normative Quantity of Secondary fuel oil
in ml/kWh as per clause 16 (iv), as the
case may be, and
AUXn=
Normative Auxiliary Energy Consumption as % of gross generation as per
clause 16 (v), as the case may be.
(iii) Adjustment of rate of energy charge (REC) on account of variation in price
or heat value of fuels
Initially, Gross Calorific Value of coal/lignite or gas or liquid fuel shall be
taken as per actuals of the preceding three months. Any variation shall be
adjusted on month to month basis on the basis of Gross Calorific Value of
coal/lignite or gas or liquid fuel received and burnt and landed cost incurred by
the generating company for procurement of coal/lignite, oil, or gas or liquid
fuel, as the case may be. No separate petition need to be filed with the
Commission for fuel price adjustment. In case of any dispute, an appropriate
application in accordance with Central Electricity Regulatory Commission
(Conduct of Business Regulations), 1999, as amended from time to time or
any statutory re-enactment thereof, shall be made before the Commission.
(iv)
Landed Cost of Coal
The landed cost of coal shall include price of coal corresponding to the
grade/quality of coal inclusive of royalty, taxes and duties as applicable,
transportation cost by rail/road or any other means, and, for the purpose of
computation of energy charges, shall be arrived at after considering
normative transit and handling losses as percentage of the quantity of coal
dispatched by the coal supply company during the month as given below:
192
Pit head generating stations : 0.3%
Non-Pit head generating stations : 0.8%
1
Incentive: Incentive shall be payable at a flat rate of 25.0 paise/kWh for ex-bus
scheduled energy corresponding to scheduled generation in excess of ex-bus energy
corresponding to target Plant Load Factor.
2
Unscheduled Interchange(UI) Charges: (1) Variation between actual generation or
actual drawal and scheduled generation or scheduled drawal shall be accounted for
through Unscheduled Interchange (UI) Charges. UI for a generating station shall be
equal to its actual generation minus its scheduled generation. UI for a beneficiary
shall be equal to its total actual drawal minus its total scheduled drawal. UI shall be
worked out for each 15 minute time block. Charges for all UI transactions shall be
based on average frequency of the time block and the following rates shall apply with
effect from 1.4.2004 :
Average Frequency of time block UI Rate (Paise per kWh)
50.5 Hz and above 0.0 Below 50.5 Hz and up to 50.48 Hz 8.0 Below 49.04 Hz
and up to 49.02 Hz 592.0 Below 49.02 Hz 600.0 Between 50.5 Hz and 49.02
Hz linear in 0.02 Hz step
(Each 0.02 Hz step is equivalent to 8.0 paise /kWh within the above
range.)
Note
The above average frequency range and UI rates are subject to change through a
separate notification by the Commission.
(2)
(i) Any generation up to 105% of the declared capacity in any time block of 15
minutes and averaging up to 101% of the average declared capacity over a
day shall not be construed as gaming, and the generator shall be entitled to UI
charges for such excess generation above the scheduled generation (SG).
(ii) For any generation beyond the prescribed limits, the Regional Load
Despatch Centre shall investigate so as to ensure that there is no gaming, and
if gaming is found by the Regional Load Despatch Centre, the corresponding
UI charges due to the generating station on account of such extra generation
shall be reduced to zero and the amount shall be adjusted in UI account of
beneficiaries in the ratio of their capacity share in the generating station.
1
Rebate: For payment of bills of capacity charges and energy charges through
a letter of credit on presentation, a rebate of 2% shall be allowed. If the payments are
made by a mode other than through a letter of credit but within a period of one month
of presentation of bills by the generating company, a rebate of 1% shall be allowed.
193
2
Late Payment Surcharge: In case the payment of bills of capacity charges and
energy charges by the beneficiary (ies) is delayed beyond a period of 1 month from
the date of billing, a late payment surcharge at the rate of 1.25% per month shall be
levied by the generating company.
27. Scheduling: Read with the provisions of the Indian Electricity Grid Code,
the methodology of scheduling and calculating availability shall be as under:
(i) The generator shall make an advance declaration of capability of its
generating station. The declaration shall be for that capability which can be actually
made available.
The declaration shall be for the capability of the generating station to deliver
ex-bus MW for the next day either as one figure for the whole day or as different
figures for different periods of the day. The capability as declared by the generator,
also referred to as the declared capacity, shall form the basis of generation
scheduling.
(ii) While making or revising its declaration of capability, the generator shall
ensure that the declared capability during peak hours is not less than that during
other hours. However, exception to this rule shall be allowed in case of tripping/resynchronisation of units as a result of forced outage of units.
(iii) Generation scheduling shall be done in accordance with the operating procedure
stipulated in the Indian Electricity Grid Code.
(iv) Based on the declaration of the generator, the Regional Load Despatch
Centre shall communicate their shares to the beneficiaries out of which they shall
give their requisitions.
(v) Based on the requisitions given by the beneficiaries and taking into
account technical limitations on varying the generation and also taking into account
transmission system constraints, if any, the Regional Load Despatch Centre shall
prepare the economically optimal generation schedules and drawal schedules and
communicate the same to the generator and the beneficiaries.
The Regional Load Despatch Centre shall also formulate the procedure for
meeting contingencies both in the long run and in the short run (Daily scheduling).
(vi) The scheduled generation and actual generation shall be ex-bus at the
generating station. For beneficiaries, the scheduled and actual net drawals shall be
at their respective receiving points.
(vii) For calculating the net drawal schedules of beneficiaries, the transmission losses
shall be apportioned to their drawal schedules for the time being.
Provided that a refinement may be specified by the Commission in future depending
on the preparedness of the respective Regional Load Despatch Centre.
(viii) In case of forced outage of a unit, the Regional Load Despatch Centre shall
revise the schedules on the basis of revised declared capability. The revised
194
declared capability and the revised schedules shall become effective from the 4th
time block, counting the time block in which the revision is advised by the generator
to be the first one.
(ix) In the event of bottleneck in evacuation of power due to any constraint,
outage, failure or limitation in the transmission system, associated switchyard and
sub- stations owned by the Central Transmission Utility or any other transmission
licensee involved in inter-state transmission (as certified by the Regional Load
Despatch Centre ) necessitating reduction in generation, the Regional Load
Despatch Centre shall revise the schedules which shall become effective from the
4th time block, counting the time block in which the bottleneck in evacuation of power
has taken place to be the first one. Also, during the first, second and third time blocks
of such an event, the scheduled generation of the generating
station shall be deemed to have been revised to be equal to actual generation,
and the scheduled drawals of the beneficiaries shall be deemed to have been revised
to be equal to their actual drawals.
(x) In case of any grid disturbance, scheduled generation of all the generating
stations and scheduled drawal of all the beneficiaries shall be deemed to have been
revised to be equal to their actual generation/drawal for all the time blocks affected
by the grid disturbance. Certification of grid disturbance and its duration shall be
done by the Regional Load Despatch Centre.
(xi) Revision of declared capability by the generator(s) and requisition by
beneficiary(ies) for the remaining period of the day shall also be permitted with
advance notice. Revised schedules/declared capability in such cases shall become
effective from the 6th time block, counting the time block in which the request for
revision has been received in the Regional Load Despatch Centre to be the first one.
(xii) If, at any point of time, the Regional Load Despatch Centre observes that
there is need for revision of the schedules in the interest of better system
operation, it may do so on its own, and in such cases, the revised schedules
shall become effective from the 4th time block, counting the time block in
which the revised schedule is issued by the Regional Load Despatch Centre
to be the first one.
(xiii) Generation schedules and drawal schedules issued/revised by the
Regional Load Despatch Centre shall become effective from designated time
block irrespective of communication success.
(xiv) For any revision of scheduled generation, including post facto deemed
revision, there shall be a corresponding revision of scheduled drawals of the
beneficiaries.
(xv) A procedure for recording the communication regarding changes to
schedules duly taking into account the time factor shall be evolved by the
Central Transmission Utility.
195
Note
In case of a generating station, contracting to supply power only to the State in
which it is located, the scheduling, metering and energy accounting shall be carried
out by the respective State Load Despatch Centre.
28. Demonstration of Declared Capability: (1) The generating company may be
required to demonstrate the declared capability of its generating station as and when
asked by the Regional Load Despatch Centre of the region in which the generating
station is situated. In the event of the generating company failing to demonstrate the
declared capability, the capacity charges due to the generator shall be reduced as a
measure of penalty.
(2) The quantum of penalty for the first mis-declaration for any duration/block
in a day shall be the charges corresponding to two days fixed charges. For the
second misdeclaration the penalty shall be equivalent to fixed charges for four days
and for subsequent mis-declarations, the penalty shall be multiplied in the
geometrical progression.
(3) The operating log books of the generating station shall be available for
review by the Regional Electricity Board or Regional Power Committee, as the case
may be. These books shall keep record of machine operation and maintenance.
29. Metering and Accounting: Metering arrangements, including installation, testing
and operation and maintenance of meters and collection, transportation and
processing of data required for accounting of energy exchanges and average
frequency on 15 minute time block basis shall be organised by the Central
Transmission Utility/Regional Load Despatch Centres. All concerned entities (in
whose premises the special energy meters are installed), shall fully cooperate with
the Central Transmission Utility/Regional Load Despatch Centre and extend the
necessary assistance by taking weekly meter readings and transmitting them to the
Regional Load Despatch Centre. Processed data of meters along with data relating
to declared capability and schedules etc., shall be supplied by the Regional Load
Despatch Centres to the Regional Power Committee or the Regional Electricity
Board and the Regional Power Committee or the Regional Electricity Board shall
issue the Regional Accounts for energy on monthly basis as well as UI charges on
weekly basis. UI accounting procedures shall be governed by the orders of the
Commission.
Note
In case of a generating station, contracting to supply power only to the State in
which it is located, the scheduling, metering and energy accounting shall be carried
out
by the respective State Load Despatch Centre.
196
30. Billing and Payment of Capacity Charges: Billing and payment of capacity
charges shall be done on a monthly basis in the following manner:
(i) Each beneficiary shall pay the capacity charges in proportion to its
percentage share in Installed Capacity of the generating station.
Note 1
Allocation of total capacity of central sector generating stations is made by
Central Government from time to time which also has an unallocated portion.
Allocation of the unallocated portion as made by the Central Government
from time to time, for the total unallocated capacity shall be notified by the
Member Secretary, Regional Electricity Board/Regional Power Committee in
advance, at least 3 days prior to such change in allocation taking effect. The
total capacity share of any beneficiaries would be sum of its capacity share
plus allocation out of the unallocated portion. In the absence of no specific
distribution of unallocated power by the Central Government, the unallocated
power shall be added to the allocated shares in the same proportion as the
allocated shares.
Note 2
The beneficiaries may propose surrendering part of their allocated share to other
States within/outside the region. In such cases, depending upon the technical
feasibility of power transfer and specific agreements reached by the generating
company with other States within/outside the region for such transfers, the shares of
the beneficiaries may be re-allocated by the Central Government for a specific
period. When such re-allocations are made, the beneficiaries who surrender the
share shall not be liable to pay capacity charges for the surrendered share. The
capacity charges for the capacity surrendered and reallocated as above shall be paid
by the State(s) to whom the surrendered capacity is allocated. Except for the period
of reallocation of capacity as above, the beneficiaries of the generating station shall
continue to pay the full fixed charges as per allocated capacity shares. Any such
reallocation shall be notified by the Member Secretary, Regional Electricity
Board/Regional Power Committee in advance, at least 3 days prior to such
reallocation taking effect.
(ii) The beneficiaries shall have full freedom for negotiating any transaction for
utilisation of their capacity shares. In such cases, the beneficiary having allocation in
the capacity of the generating station shall be liable for full payment of capacity
charges and energy charges (including that for sale of power under the transaction
negotiated by him) corresponding to his total allocation and schedule respectively.
(iii) If any capacity remains un-requisitioned during day-to-day operation, the
Regional Load Despatch Centre shall advise all beneficiaries in the region and the
other Regional Load Despatch Centres so that such capacity may be requisitioned
197
through bilateral arrangements either with the concerned generating company or with
the concerned beneficiary(ies) under intimation to the Regional Load Despatch
Centre.
The information regarding un-requisitioned capacity shall also be made available by
the Regional Load Despatch Centres through their respective websites.
(iv) The capacity charges shall be paid by the beneficiary(ies) including those outside
the region to the generating company every month in accordance with the following
formulas:
(a) Total Capacity charges payable to the thermal power generating company
for the:
st
1 month = (1xACC1)/12
nd
2 month = (2XACC2 - 1XACC1)/12
rd
3 month = (3xACC3 - 2XACC2)/12
th
th
th
th
4 month = (4xACC4 - 3xACC3)/12 5 month = (5XACC5 - 4xACC4)/12 6 month = (6XACC5 - 5xACC5)/12 7
th
th
th
month = (7XACC7 - 6xACC6)/12 8 month = (8xACC8 - 7xACC7)/12 9 month = (9xACC9 - 8xACC8)/12 10 month
th
th
= (10xACC10 – 9xACC9)/12 11 month = (11xACC11 - 10xACC10)/12 12 month = (12xACC12 - 11xACC11)/12
(b) Each beneficiary having firm allocation in capacity of the generating station shall
pay for the :
st
nd
1 month = [ ACC1 x WB1 ]/1200 2 month = [2XACC2 x WB2 - 1XACC1x
rd
th
WB1]/1200 3 month = (3xACC3 x WB3 - 2XACC2 x WB2]/1200 4 month =
th
(4xACC4 x WB4 - 3xACC3 x WB3]/1200 5 month = (5XACC5 x WB5 - 4xACC4 x
th
th
WB4]/1200 6 month = (6XACC5 x WB6 - 5xACC5 x WB5]/1200 7 month =
th
(7XACC7 x WB7 - 6xACC6 x WB6]/1200 8 month = (8xACC8 x WB8 - 7xACC7 x
th
th
WB7]/1200 9 month = (9xACC9 x WB9 - 8xACC8 x WB8]/1200 10 month =
th
(10xACC10 x WB10- 9xACC9 x WB9]/1200 11 month = (11xACC11 x WB11th
10xACC10x WB10]/1200 12 month = (12xACC12 x WB12- 11xACC11x WB
11]/1200
Where,
ACC1, ACC2, ACC3, ACC4, ACC5 ACC6, ACC7, ACC8, ACC9, ACC10, ACC11 and
ACC12 are the amount of Annual Capacity Charge corresponding to ‘Availability’ for
st
nd
rd
th
th
th
th
th
th
th
th
th
the cumulative period up to the end of 1 , 2 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 and 12
months respectively.
And, WB1, WB2, WB3, WB4, WB5, WB6, WB7, WB8, WB9, WB10, WB11 and
WB12 are the weighted average of percentage allocated capacity share of the
st
nd
rd
th
th
th
th
th
th
th
th
beneficiary during the cumulative period up to 1 , 2 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 11
198
th
and 12 month respectively.
CHAPTER 3
HYDRO POWER GENERATING STATIONS
31. Definitions: Unless the context otherwise requires for the purpose of this
chapter, :(i) ‘Act’ means the Electricity Act, 2003;
(ii) `Additional Capitalisation' means the capital expenditure actually incurred
after the date of commercial operation of the station and admitted by the
Commission after prudence check subject to provisions of regulation 34;
(iii) ‘Authority ' means Central Electricity Authority referred to in Section 70 of
the Act;
(iv) 'Auxiliary Energy Consumption’ in relation to a period means the quantum of
energy consumed by auxiliary equipment of the generating station, and shall be
expressed as a percentage of the sum of gross energy generated at generator
terminals of all the units of the generating station;
(v) ‘Beneficiary’ in relation to a generating station means the person buying
power generated at such a generating station on payment of annual capacity
charges;
(vi) 'Capacity Index' means the average of the daily capacity indices over one
year;
(vii) 'Commission' means the Central Electricity Regulatory Commission
referred to in Section 76 of the Act;
(viii) ‘Cut off Date’ means after one year of the date of commercial operation
of the generating station;
(ix) ‘Date of Commercial Operation’ or ‘COD’ in relation to a unit means the date
declared by the generator after demonstrating the Maximum Continuous Rating
(MCR) or Installed Capacity (IC) through a successful trial run, after notice to the
beneficiaries, and in relation to the generating station the date of commercial
operation means the date of commercial operation of the last unit of the generating
station;
(x) 'Daily Capacity Index' means the declared capacity expressed as a
percentage of the maximum available capacity for the day and shall be
mathematically expressed as hereunder:
Declared Capacity (MW)
Daily Capacity Index = ------------------------------------------------ x
100 Maximum Available Capacity
(MW)
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Daily capacity index shall be limited to 100%.
(xi)
‘Declared Capacity' or 'DC'
(a) For run-of-river power station with pondage and storage-type power
stations, declared capacity means the ex-bus capacity in MW expected to be
available from the generating station over the peaking hours of next day, as declared
by the generator, taking into account the availability of water, optimum use of water
and availability of machines and for this purpose, the peaking hours shall not be less
than 3 hours within 24 hour period, and
(b) In case of purely run-of–river power stations, declared capacity means the
ex-bus capacity in MW expected to be available from the generating station during
the next day, as declared by the generating station, taking into account the
availability of water, optimum use of water and availability of machines;
(xii) ‘Deemed Generation ' means the energy which a generating station was
capable of generating but could not generate due to the conditions of grid or power
system, beyond the control of generating station resulting in spillage of water;
(xiii) 'Design Energy' means the quantum of energy which could be generated in a
90% dependable year with 95% installed capacity of the generating station;
(xiv) `Existing Generating Station' means a generating station declared under
commercial operation from a date prior to 1.4.2004;
(xv) ‘Infirm Power’ means electricity generated prior to commercial operation of the
unit of a generating station;
(xvi) ‘Installed Capacity' or 'IC’ means the summation of the name plate capacities of
the units in the generating station or the capacity of the generating station (reckoned
at the generator terminals) as approved by the Commission from time to time;
(xvii)
'Maximum Available Capacity' means the following:
(a)
Run-of-river power station with pondage and storage type power
stations
The maximum capacity in MW, the generating station can generate with
all units running, under the prevailing conditions of water levels and flows,
over the peaking hours of next day,
Explanation
The peaking hours for this purpose shall not be less than 3 hours within a 24
hours period.
(b) Purely run-of-river power stations
200
The maximum capacity in MW, the generating station can generate with
all units running, under the prevailing conditions of water levels and flows over
the next day.
(xviii) 'Operation and Maintenance Expenses' or `O&M Expenses' means the
expenditure incurred in operation and maintenance of the generating station,
including part thereof, including the expenditure on manpower, repairs, spares,
consumables, insurance and overheads;
(xix) `Original Project Cost' means the actual expenditure incurred by the generating
company, as per the original scope of project up to first financial year closing after
one year of the date of commercial operation of the last unit as admitted by the
Commission for determination of tariff;
(xx) 'Primary Energy ' means the quantum of energy generated up to the design
energy on per year basis at the generating station;
(xxi) 'Project ' means a generating station and includes the complete hydro power
generating facility covering all components such as dam, intake, water conductor
system, power generating station and generating units of the scheme as apportioned
to power generation;
(xxii) ‘Run-of-river power station’ means a hydro electric power generating station
which has no upstream pondage;
(xxiii) ‘ Run –of-river power station with pondage’ means a hydro electric power
generating station with sufficient pondage for meeting the diurnal variation of power
demand;
(xiv) ‘ Storage Type power station’ means a hydro electric power generating station
associated with large storage capacity to enable variation of generation of power
according to demand;
(xxv) 'Saleable Primary Energy' means the quantum of primary energy available for
sale (ex-bus) after allowing for 12% free energy to the home state;
(xxvi) 'Secondary Energy' means the quantum of energy generated in excess of the
design energy on per year basis at the generating station;
(xxvii) 'Saleable Secondary Energy' means the quantum of secondary energy
available for sale (ex-bus) after allowing for 12% free energy to the home state;
(xxviii) 'Scheduled Energy' means the quantum of energy to be generated at
the generating station over the 24-hour period, as scheduled by the Regional
Load Despatch Centre;
(xxix) ‘Year’ means a financial year.
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32.
Norms of Operation: The norms of operation shall be as under, namely:
(i)
Normative capacity index for recovery of full capacity charges
(a) During first year of commercial operation of the generating station
(i)
Purely Run-of-river power stations
- 85%
(ii)
Storage type and Run-of-river power stations with pondage
(b) After first year of commercial operation of the generating station
(i)
Purely Run-of –river power stations - 90%
(ii)
Storage type and Run-of-river power stations with pondage
- 80%
- 85%
Note
There shall be pro rata recovery of capacity charges in case the generating
station achieves capacity index below the prescribed normative levels. At Zero
capacity index, no capacity charges shall be payable to the generating station.
(ii)
Auxiliary Energy Consumption :
(a) Surface hydro electric power generating stations with rotating exciters
mounted on the generator shaft - 0.2% of energy generated
(b) Surface hydro electric power generating stations with static excitation
system - 0.5% of energy generated
(c) Underground hydro electric power generating stations with rotating exciters
mounted on the generator shaft - 0.4% of energy generated
(d) Underground hydro electric power generating stations with static excitation
system - 0.7% of energy generated
(iii)
Transformation losses
From generation voltage to transmission voltage - 0.5% of energy
generated.
33. Capital Cost: Subject to prudence check by the Commission, the actual
expenditure incurred on completion of the project shall form the basis for
determination of final tariff. The final tariff shall be determined based on the admitted
capital expenditure actually incurred up to the date of commercial operation of the
generating station and shall include initial capital spares subject to a ceiling norm of
1.5% of the original project cost as on the cut off date.
Provided further that where the power purchase agreement entered into
between the generating company and the beneficiaries provides a ceiling of actual
expenditure, the capital expenditure shall not exceed such ceiling for determination of
tariff.
In case of existing generating stations, the project cost admitted by the
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Commission prior to 1.4.2004 shall form the basis for determination of tariff.
Note
The scrutiny of the project cost estimates by the Commission shall be limited
to the reasonableness of the capital cost, financing plan, interest during construction,
use of efficient technology and such other matters for the purposes of determination
of tariff.
34. Additional capitalisation: (1) The following capital expenditure within the original
scope of work actually incurred after the date of commercial operation and up to the
cut off date may be admitted by the Commission subject to prudence check.
(i)
(ii)
Deferred liabilities,
Works deferred for execution,
(iii)
Procurement of initial capital spares in the original scope of works
subject to ceiling specified in regulation 33,
(iv)
Liabilities to meet award of arbitration or in compliance of the order or
decree of a court, and
(iv)
On account of change in law.
Provided that original scope of works along with estimates of expenditure
shall be submitted along with the application for provisional tariff.
Provided further that a list of the deferred liabilities and works deferred for
execution shall be submitted along with the application for final tariff after the date of
commercial operation of generating station.
(2) Subject to the provision of clause (3) of this regulation, the capital
expenditure of the following nature actually incurred after the cut off date may be
admitted by the Commission subject to prudence check:
(i)
Deferred liabilities relating to works/services within the original scope of
work;
(ii)
Liabilities to meet award of arbitration or in compliance of the order or
decree of a court;
(iii)
On account of change in law; and
(iv)
Any additional works/service which has become necessary for efficient
and successful operation of plant but not included in the original capital cost.
(3) Any expenditure incurred on acquiring minor items/assets like tools and
tackles, personal computers, furniture, air-conditioners, voltage stabilizers,
refrigerators, coolers, fans, T.V, washing machine, heat-convectors, mattresses,
carpets, etc brought after the cut off date shall not be considered for additional
capitalization for determination of tariff with effect from 1.4.2004.
Note
203
The list of items is illustrative and not exhaustive.
(4) Impact of additional capitalisation in tariff revision may be considered by the
Commission twice in a tariff period, including revision of tariff after the cut off date.
Note 1
Any expenditure admitted on account of committed liabilities within the original
scope of work and the expenditure deferred on techno-economic grounds but falling
within the original scope of work shall be serviced in the normative debt-equity ratio
specified in regulation 36.
Note 2
Any expenditure on replacement of old assets shall be considered after writing
off the gross value of the original assets from the original capital cost, except such
items as are listed in Clause (3) of this regulation.
Note 3
Any expenditure admitted by the Commission for determination of tariff on
account of new works not in the original scope of work shall be serviced in the
normative debt-equity ratio specified in regulation 36.
Note 4
Any expenditure admitted on renovation and modernization and life extension
shall be serviced on normative debt-equity ratio specified in regulation 36 after writing
off the original amount of the replaced assets from the original capital cost.
1
Sale of Infirm Power: Any revenue earned by the generating company from sale
of infirm power, shall be taken as reduction in capital cost and shall not be treated as
revenue. The rate for infirm power shall be same as the primary energy rate of the
generating station.
2
Debt-Equity Ratio: (1) In case of all generating stations, debt–equity ratio as on
the date of commercial operation shall be 70:30 for determination of tariff. Where
equity employed is more than 30%, the amount of equity for determination of tariff
shall be limited to 30% and the balance amount shall be considered as the normative
loan.
Provided that in case actual equity employed is less than 30%, the actual debt
and equity shall be considered for determination of tariff.
(2) The debt and equity amounts arrived at in accordance with clause (1) shall be
used for calculating interest on loan, return on equity, Advance Against Depreciation
and Foreign Exchange Rate Variation.
37. Computation of Annual Charges: The two-part tariff for sale of electricity from a
204
hydro power generating station shall comprise of recovery of annual capacity charge
and primary energy charges:
(i) Capacity Charges: The capacity charges shall be computed in accordance
with the following formula:
Capacity Charges = (Annual Fixed Charge- Primary Energy Charge)
Note
Recovery through Primary energy charge shall not be more than
Annual Fixed Charge.
(ii) Annual Fixed Charges: Annual Fixed Charges shall consist of:
(a) Interest on loan capital;
(b) Depreciation, including Advance Against Depreciation;
(c) Return on equity;
(d) Operation and maintenance expenses; and
(e) Interest on working capital.
38. Computation of Annual Fixed Charges: The annual fixed charges shall be
computed on the following basis:
(i) Interest on loan capital
(a) Interest on loan capital shall be computed loan wise on the loans arrived at
in the manner indicated in regulation 36.
(b) The loan outstanding as on 1.4.2004 shall be worked out as the gross loan
as per regulation 36 minus cumulative repayment as admitted by the Commission up
to 31.3.2004. The repayment for the period 2004-09 shall be worked out on a
normative basis.
(c) The generating company shall make every effort to swap the loan as long
as it results in net benefit to the beneficiaries. The costs associated with such
swapping shall be borne by the beneficiaries.
(d) The changes to the loan terms and conditions shall be reflected from the
date of such swapping and benefit passed on to the beneficiaries.
(e) In case of any dispute, any of the parties may approach the Commission
with proper application. However, the beneficiaries shall not withhold any payment as
ordered by the Commission to the generating company during pendency of any
dispute relating to swapping of loan.
(f) In case any moratorium period is availed of by the generating company,
depreciation provided for in the tariff during the years of moratorium shall be treated
as repayment during those years and the interest on loan capital shall be calculated
accordingly.
(g) The generating company shall not make any profit on account of swapping
205
of loan and interest on loan.
(ii) Depreciation, including Advance Against Depreciation
(a) Depreciation
For the purpose of tariff, depreciation shall be computed in the
following manner, namely:
(i) The value base for the purpose of depreciation shall be the historical cost of
the asset.
(ii) Depreciation shall be calculated annually based on straight line method
over the useful life of the asset and at the rates prescribed in Appendix II to these
regulations.
The residual life of the asset shall be considered as 10% and
depreciation shall be allowed up to maximum of 90% of the historical
capital cost of the asset. Land is not a depreciable asset and its cost
shall be excluded from the capital cost while computing 90% of the
historical cost of the asset. The historical capital cost of the asset shall
include additional capitalisation on account of Foreign Exchange Rate
Variation up to 31.3.2004 already allowed by the Central
Government/Commission.
(iii) On repayment of entire loan, the remaining depreciable value shall
be spread over the balance useful life of the asset.
(iv) Depreciation shall be chargeable from the first year of operation. In
case of operation of the asset for part of the year, depreciation shall be
charged on pro rata basis.
(b ) Advance Against Depreciation
In addition to allowable depreciation, the generating company
shall be entitled to Advance Against Depreciation, computed in the
manner given hereunder:
AAD = Loan repayment amount as per regulation 38 (i) subject
th
to a ceiling of 1/10 of loan amount as per regulation 36 minus
depreciation as per schedule
Provided that Advance Against Depreciation shall be permitted only if
the cumulative repayment up to a particular year exceeds the cumulative
depreciation up to that year;
Provided further that Advance Against Depreciation in a year shall be
restricted to the extent of difference between cumulative repayment and
206
cumulative depreciation up to that year.
(iii) Return on Equity
Return on equity shall be computed on the equity base determined in accordance
with regulation 36 and shall be @ 14% per annum.
Provided that equity invested in any foreign currency shall be allowed a return
up to the prescribed limit in the same currency and the payment on this account shall
be made in Indian Rupees based on the exchange rate prevailing on the due date of
billing.
Explanation
The premium raised by the generating company while issuing share capital
and investment of internal resources created out of free reserve of the existing
generating station, if any, for the funding of the project, shall also be reckoned as
paid up capital for the purpose of computing return on equity, provided such premium
amount and internal resources are actually utilised for meeting the capital
expenditure of the generating station and forms part of the approved financial
package.
(iv) Operation and Maintenance expenses
(a) The operation and maintenance expenses including insurance, for the
existing generating stations which have been in operation for 5 years or more
in the base year of 2003-04, shall be derived on the basis of actual operation
and maintenance expenses for the years 1998-99 to 2002-03, based on the
audited balance sheets, excluding abnormal operation and maintenance
expenses, if any, after prudence check by the Commission.
The average of such normalised operation and maintenance expenses
after prudence check, for the years 1998-99 to 2002-03 considered as
operation and maintenance expenses for the year 2000-01 shall be escalated
at the rate of 4% per annum to arrive at operation and maintenance expenses
for the base year 2003-04.
The base operation and maintenance expenses for the year 200304
shall be escalated further at the rate of 4% per annum to arrive at permissible
operation and maintenance expenses for the relevant year of tariff period.
(b) In case of the hydro electric generating stations, which have not been in
existence for a period of five years, the operation and maintenance expenses shall
be fixed at 1.5% of the capital cost as admitted by the Commission and shall be
escalated at the rate of 4% per annum from the subsequent year to arrive at
operation and maintenance expenses for the base year 2003-04. The base operation
207
and maintenance expenses shall be further escalated at the rate of 4% per annum to
arrive at permissible operation and maintenance expenses for the relevant year.
(c) In case of the hydro electric generating stations declared under
commercial operation on or after 1.4.2004, the base operation and
maintenance expenses shall be fixed at 1.5% of the actual capital cost as
admitted by the Commission, in the year of commissioning and shall be
subject to an annual escalation of 4% per annum for the subsequent years.
(v) Interest on Working Capital
(a) Working Capital shall cover:
(i) Operation and Maintenance expenses for one month;
(ii) Maintenance spares @ 1% of the historical cost escalated @ 6% per
annum from the date of commercial operation; and
(iii) Receivables equivalent to two months of fixed charges for sale of
electricity, calculated on normative capacity index.
(b) Rate of interest on working capital shall be the short-term Prime Lending
st
Rate of State Bank of India as on 1.4.2004 or on 1 April of the year in which the
generating unit/station is declared under commercial operation, whichever is later.
The interest on working capital shall be payable on normative basis notwithstanding
that the generating company has not taken working capital loan from any outside
agency.
39. Primary and Secondary Energy Charges: (1) Primary energy charge shall be
worked out on the basis of paise per kWh rate on ex-bus energy scheduled to be
sent out from the hydro electric power generating station after adjusting for free
power delivered to the home state.
(2) Rate of primary energy for all hydro electric power generating stations, except
for pumped storage generating stations, shall be equal to the lowest variable
charges of the central sector thermal power generating station of the concerned
region. The primary energy charge shall be computed based on the primary
energy rate and saleable energy of the station.
Provided that in case the primary energy charge recoverable by applying
the above primary energy rate exceeds the Annual Fixed Charge of a generating
station, the primary energy rate for such generating station shall be calculated by
the following formula:
Primary energy rate = Annual Fixed Charge
Saleable Primary Energy
(3) Primary Energy Charge = Saleable Primary Energy x Primary Energy Rate
Secondary Energy Rate shall be equal to Primary Energy Rate. Secondary
208
Energy Charge = Saleable Secondary Energy x Secondary Energy Rate.
40. Incentive: (1) Incentive shall be payable in case of all the generating stations,
including in case of new generating stations in the first year of operation, when the
capacity index (CI) exceeds 90% for purely run-of-river power generating stations
and 85% for run-of-river power station with pondage or storage type power
generating stations and incentive shall accrue up to a maximum capacity index of
100%.
(2) Incentive shall be payable to the generating company in accordance with the
following formula: Incentive = 0.65 x Annual Fixed Charge x (CIA – CIN)/100
(If incentive is negative, it shall be set to zero.)
Where, CIA is the Capacity Index achieved and CIN is the
normative capacity index whose values are 90% for purely run of
the river hydro stations and 85% for pondage/storage type hydro
generating stations.
(3) The incentives on account of capacity index and payment for secondary
energy shall be payable on monthly basis, subject to cumulative adjustment in each
month of the financial year, separately in respect of each item, and final adjustment
shall be made at the end of the financial year.
(4) The total incentive payment calculated on annual basis shall be shared by
the beneficiaries based on the allocated capacity.
(5) Incentive for completion of hydro electric power generating stations ahead
of schedule
In case of commissioning of a hydro electric power generating station or part
thereof ahead of schedule, as set out in the first approval of the Central Government
or the techno-economic clearance of the Authority, as applicable, the generating
station shall become eligible for incentive for an amount equal to pro rata reduction in
interest during construction, achieved on commissioning ahead of the schedule. The
incentive shall be recovered through tariff in twelve equal monthly installments during
the first year of operation of the generating station.
In case of delay in
commissioning as set out in the first approval of the Central Government or the
techno-economic clearance of the Authority, as applicable, interest during
construction for the period of delay shall not be allowed to be capitalised for
determination of tariff, unless the delay is on account of natural calamities or
geological surprises.
41. Deemed Generation: (1) In case of reduced generation due to the reasons
beyond the control of generating company or on account of non-availability of
Board's/transmission licensee's transmission lines or on receipt of backing down
instructions from the concerned Regional Load Despatch Centre resulting in spillage
of water, the energy charges on account of such spillage shall be payable to the
generating company. Apportionment of energy charges for such spillage among the
209
beneficiaries shall be in proportion of their shares in saleable capacity of the
generating station.
(2) Energy charges on the above account shall not be admissible if the energy
generated during the year is equal to or more than the design energy.
42. Unscheduled Interchange (UI): (1) Variation between actual generation or actual
drawal and scheduled generation or scheduled drawal shall be accounted for through
Unscheduled Interchange (UI) charges. UI for a generating station shall be equal to
its actual generation minus its scheduled generation. UI for a beneficiary shall be
equal to its total actual drawal minus its total scheduled drawal. UI shall be worked
out for each 15 minute time block. Charges for all UI transactions shall be based on
average frequency of the time block and the following rates shall apply with effect
from 1.4.2004:
Average Frequency of time block UI Rate (Paise per kWh)
50.5 Hz and above 0.0 Below 50.5 Hz and up to 50.48 Hz 8.0 Below 49.04 Hz
and up to 49.02 Hz 592.0 Below 49.02 Hz 600.0 Between 50.5 Hz and 49.02
Hz linear in 0.02 Hz step (Each 0.02 Hz step is equivalent to 8.0 paise /kWh
within the above range)
Note
The above average frequency range and UI rates are subject to change through a
separate notification by the Commission.
(2)
(i) Any generation up to 105% of declared capacity in any time block of 15
minutes and averaging up to 101% of the average declared capacity over a
day shall not be construed as gaming, and generator shall be entitled to UI
charges for such excess generation above the scheduled generation (SG).
(ii) For any generation beyond the prescribed limits, the Regional Load
Despatch Centre shall investigate so as to ensure that there is no gaming, and
if gaming is found by the Regional Load Despatch Centre, the corresponding
UI charges due to the generating station on account of such extra generation
shall be reduced to zero and the amount shall be adjusted in UI account of
beneficiaries, in the ratio of their capacity share in the generating station.
1
Rebate: For payment of bills of capacity charge and energy charge through the
letter of credit on presentation, a rebate of 2% shall be allowed. If the payments are
made by a mode other than through the letter of credit but within a period of one
month of presentation of bills by the generating company , a rebate of 1% shall be
allowed.
2
Late Payment Surcharge: In case the payment of bills of capacity charge and
energy charge by the beneficiary (ies) is delayed beyond a period of 1 month from
210
the date of billing, a late payment surcharge at the rate of 1.25% per month shall be
levied by the generating company .
45. Scheduling: Read with the provisions of the Indian Electricity Grid Code, the
methodology of scheduling and calculating capacity index shall be as under:
(i) The generator shall make an advance declaration of capacity of its
generating station. The declaration shall be for that capacity which can be
actually made available for a period of time not less than 3 hours within a 24
hours period for pondage and storage type of stations and for the entire day for
purely run-of-river type stations.
(ii) The generator shall intimate the declared capacity (MW), for the next day,
either as one figure for the whole day or different figures for different periods of the
day along with maximum available capacity (MW) and total energy (MWh) ex-bus to
the Regional Load Despatch Centre.
The declaration should also include limitation on generation during specific time
periods, if any, on account of restriction(s) on water use due to irrigation, drinking
water, industrial, environmental considerations etc.
(iii) While making or revising his declaration of capability, the generator shall ensure
that the declared capacity during peak hours is not less than that during other hours.
However, exception to this rule shall be allowed in case of tripping/re-synchronisation
of units as a result of forced outage of units.
(iv) Generation scheduling shall be done in accordance with the operating
procedure, as stipulated in the Indian Electricity Grid Code.
(v) Based on the declaration of the generator, the Regional Load Despatch
Centre shall communicate their shares to the beneficiaries out of which they shall
give their requisitions.
(vi) Based on the requisitions given by the beneficiaries and taking into
account technical limitations on varying the generation and also taking into account
transmission system constraints, if any, the Regional Load Despatch Centre shall
prepare the economically optimal generation schedules and drawal schedules and
communicate the same to the generator and the beneficiaries.
The Regional Load Despatch Centre shall also formulate the procedure for meeting
contingencies both in the long run and in the short run (Daily scheduling).
(vii) The scheduled generation and actual generation shall be ex-bus at the
generating station. For beneficiaries, the scheduled and actual net drawals shall be
at their respective receiving points.
(viii) For calculating the net drawal schedules of beneficiaries, the transmission
losses shall be apportioned to their drawal schedule for the time being. However, a
refinement may be specified by the Commission in future, depending upon the
preparedness of the respective Regional Load Despatch Centre.
211
(ix) In case of forced outage of a unit, the Regional Load Despatch Centre
shall revise the schedules on the basis of revised declared capability. The revised
declared capability and the revised schedules shall become effective from the 4th
time block, counting the time block in which the revision is advised by the generator
to be the first one.
(x) In the event of bottleneck in evacuation of power due to any constraint,
outage, failure or limitation in the transmission system, associated switchyard and
sub- stations owned by the Central Transmission Utility or any other transmission
licensee involved in inter-state transmission (as certified by the Regional Load
Despatch Centre) necessitating reduction in generation, the Regional Load Despatch
Centre shall revise the schedules which shall become effective from the 4th time
block, counting the time block in which the bottleneck in evacuation of power has
taken place to be the first one. Also, during the first, second and third time blocks of
such an event, the scheduled generation of the generating station shall be deemed to
have been revised to be equal to actual generation, and the scheduled drawals of the
beneficiaries shall be deemed to have been revised to be equal to their actual
drawals.
(xi) In case of any grid disturbance, scheduled generation of all the generating
stations and scheduled drawal of all the beneficiaries shall be deemed to have been
revised to be equal to their actual generation/drawal for all the time blocks affected
by the grid disturbance. Certification of grid disturbance and its duration shall be
done by the Regional Load Despatch Centre.
(xii) Revision of declared capability by the generator(s) and requisition by
beneficiary(ies) for the remaining period of the day shall also be permitted with
advance notice. Revised schedules/declared capability in such cases shall become
effective from the 6th time block, counting the time block in which the request for
revision has been received in the Regional Load Despatch Centre to be the first one.
(xiii) If, at any point of time, the Regional Load Despatch Centre observes that there
is need for revision of the schedules in the interest of better system operation, it may
do so on its own and in such cases, the revised schedules shall become effective
from the 4th time block, counting the time block in which the revised schedule is
issued by the Regional Load Despatch Centre to be the first one.
(xiv) Generation schedules and drawal schedules issued/revised by the Regional
Load Despatch Centre shall become effective from designated time block
irrespective of communication success.
(xv) For any revision of scheduled generation, including post facto deemed revision,
there shall be a corresponding revision of scheduled drawals of the beneficiaries.
(xvi) A procedure for recording the communication regarding changes to schedules
duly taking into account the time factor shall be evolved by the Central Transmission
Utility.
212
(xvii) Purely run-of-river power stations
Since variation of generation in such stations may lead to
spillage, these shall be treated as must run stations. The maximum
available capacity, duly taking into account the over load capability, must
be equal to or greater than that required to make full use of the available
water.
(xviii) Run-of-river power station with pondage and storage type power
stations
These hydro stations are designed to operate during peak hours
to meet system peak demand. Maximum available capacity of the
station declared for the day shall be equal to the installed capacity
including overload capability,
minus auxiliary consumption and
transformation losses, corrected for the reservoir level. The Regional
Load Despatch Centres shall ensure that generation schedules of such
type of stations are prepared and the stations dispatched for optimum
utilization of available hydro energy except in the event of specific
system requirements/constraints.
46. Demonstration of Declared Capability: (1) The generating company may be
required to demonstrate the declared capacity of its generating station as and when
asked by the Regional Load Despatch Centre of the region in which the generating
station is situated. In the event of the generating company failing to demonstrate the
declared capacity, within the tolerance as specified by the Central Transmission
Utility, the capacity charges due to the generating station shall be reduced as a
measure of penalty.
(2) The quantum of penalty for the first mis-declaration for any duration or
block in a day shall be the charges corresponding to two days fixed charges. For the
second misdeclaration the penalty shall be equivalent to fixed charges for four days
and for subsequent mis-declarations, the penalty shall be multiplied in the
geometrical progression.
(3) The operating log books of the generating station shall be available for
review by the Regional Power Committee or the Regional Electricity Board, as the
case may be. These books keep record of machine operation and maintenance,
reservoir level and spillway gate operation.
47. Metering and Accounting: Metering arrangements, including installation,
testing and operation and maintenance of meters and collection, transportation and
processing of data required for accounting of energy exchanges and average
frequency on 15 minute time block basis shall be organised by the Central
Transmission Utility/Regional Load Despatch Centres. All concerned entities (in
whose premises the special energy meters are installed), shall fully cooperate with
the Central Transmission Utility/Regional Load Despatch Centre and extend the
necessary assistance by taking weekly meter readings and transmitting them to the
213
Regional Load Despatch Centre. Processed data of meters along with data relating
to declared capability and schedules etc., shall be supplied by the Regional Load
Despatch Centres to the Regional Power Committee or the Regional Electricity
Board and the Regional Power Committee or the Regional Electricity Board shall
issue the Regional Accounts for energy on monthly
basis as well as UI charges on weekly basis. UI accounting procedures shall
be governed by the orders of the Commission.
2
Billing and Payment of Capacity Charges: Billing and payment of capacity
charges shall be done on a monthly basis in the following manner:
(i) Each beneficiary shall pay the capacity charges in proportion to its
percentage share in total saleable capacity of the generating station. Saleable
capacity shall mean total capacity minus free capacity to home state(s), if any.
Note 1
Allocation of total capacity of central sector generating stations is made by
Central Government from time to time which also has an unallocated portion.
Allocation of the unallocated portion shall be made by the Central Government
from time to time, for the total unallocated capacity and notified by the Member
Secretary, Regional Electricity Board/Regional Power Committee in advance,
at least three (3) days prior to such allocation/ change in allocation taking
effect. The total capacity share of any beneficiaries would be sum of its
capacity share plus allocation out of the unallocated portion. In the absence of
specific distribution of unallocated power by the Central Government, the
unallocated power shall be added to the allocated shares in the same
proportion as the allocated shares.
Note 2
The beneficiaries may propose surrendering part of their allocated share to
other States within/outside the region. In such cases, depending upon the
technical feasibility of power transfer and specific agreements reached by the
generating company with other States within/outside the region for such
transfers, the shares of the beneficiaries may be re-allocated by the Central
Government for a specific period. When such re-allocations are made, the
beneficiaries who surrender the share shall not be liable to pay capacity
charges for the surrendered share. The capacity charges for the capacity
surrendered and reallocated as above shall be paid by the State(s) to whom
the surrendered capacity is allocated. Except for the period of reallocation of
capacity as above, the beneficiaries of the generating station shall continue to
pay the full fixed charges as per allocated capacity shares. Any such reallocation shall be notified by the Member Secretary, Regional Electricity
Board/Regional Power Committee in advance, at least three
(3) days prior to such re-allocation taking effect.
(ii) The beneficiaries shall have full freedom for negotiating any transaction for
214
utilisation of their capacity shares. In such cases, the beneficiary having allocation in
the capacity of the generating station shall be liable for full payment of capacity
charges and energy charges (including that for sale of power under the transaction
negotiated by him) corresponding to his total allocation and schedule respectively.
(iii) If any capacity remains un-requisitioned during day-to-day operation, the
Regional Load Despatch Centre shall advise all beneficiaries in the region and the
other Regional Load Despatch Centres so that such capacity may be requisitioned
through bilateral arrangements either with the concerned generating company or the
concerned beneficiary(ies) under intimation to the Regional Load Despatch Centre.
The information regarding un-requisitioned capacity shall also be made available by
the Regional Load Despatch Centres through their respective websites.
(iv) The capacity charges shall be paid by the beneficiary(ies) including those outside
the region to the generating company every month in accordance with the following
formulas and in proportion to their respective shares in the concerned generating
station:
ACC1 =AFC – ( SPE1 + DE 2nd to 12th months) * Primary Energy Rate ACC2 =AFC
– ( SPE2 + DE 3rd to 12th months) * Primary Energy Rate ACC3 =AFC – ( SPE3 +
DE 4th to 12th months) * Primary Energy Rate ACC4 =AFC – ( SPE4 + DE 5th to 12th
months) * Primary Energy Rate ACC5 =AFC – ( SPE5 + DE 6th to 12th months) *
Primary Energy Rate ACC6 =AFC – ( SPE6 + DE 7th to 12th months) * Primary
Energy Rate ACC7 =AFC – ( SPE7 + DE 8th to 12th months) * Primary Energy Rate
ACC8 =AFC – ( SPE8 + DE 9th to 12th months) * Primary Energy Rate ACC9 =AFC
– ( SPE9 + DE 10th to 12th months) * Primary Energy Rate ACC10 =AFC – ( SPE10 +
DE 11th to 12th months) * Primary Energy Rate ACC11 =AFC – ( SPE11 + DE 12th
month) * Primary Energy Rate ACC12 =(AFC – SPE12 ) * Primary Energy Rate
Where,
AFC = Annual Fixed Charges ACC1, ACC2, ACC3, ACC4, ACC5 ACC6, ACC7, ACC8,
ACC9, ACC10, ACC11 and ACC12 are the amount of Annual Capacity Charge for the
st
nd
rd
th
th
th
th
th
th
th
th
th
cumulative period up to the end of 1 , 2 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 and 12
months respectively.
SPE1, SPE2, SPE3,………………… SPE!2 are the ex-bus scheduled primary
st
nd
rd
th
energy values up to 1 , 2 , 3 ……12 months of the year respectively.
CC1 =ACC1 x DE1 DE
CC2 =ACC2 x DE2 DE
CC3 =ACC3 x
D
215
E
3
D
E
C
C
4
=
A
C
C
4
x
D
E
4
DE
=ACC5
DE5
x
DE
CC6 =ACC6 x DE6
DE
CC5
CC7
=ACC7 x DE7
DE
CC8 =ACC8 x DE8
DE
CC9 =ACC9 x DE9
DE
CC10 =ACC10 x DE10
DE CC11 =ACC11 x DE11
DE CC12 =ACC12 x DE12
DE Where, CC1, CC2, CC3,……….CC12 is the monthly capacity
st
nd
rd
th
charge up to 1 , 2 , 3 ……12 months of the year respectively.
DE = Annual Design Energy DE1, DE2, DE3, ……….DE12 are the ex-bus design
st
nd
energy values up to 1 , 2 ,
rd
th
3 ……12 months of the year respectively.
216
Total capacity charges payable to the generator for the:
st
1 month = (CC1)
nd
2 month = (CC2 -CC1)
rd
3 month = (CC3 - CC2)
th
4 month = (CC4 -CC3)
th
5 month = (CC5 - CC4)
th
6 month = (CC6 -CC5)
th
7 month = (CC7 -CC6)
th
8 month = (CC8 -CC7)
th
9 month = (CC9 -CC8)
th
10 month =(CC10 – CC9)
th
11 month =(CC11 -CC10)
th
12 month =(CC12 -CC11)
and, each beneficiary having firm allocation in capacity of the generating station
shall pay for the :
st
1 month = [ CC1 x WB1 ]/100
nd
2 month = [CC2 x WB2 -CC1x WB1]/100
rd
3 month = (CC3 x WB3 - CC2 x WB2]/100
th
4 month = (CC4 x WB4 - CC3 x WB3]/100
th
5 month = (CC5 x WB5 - CC4 x WB4]/100
th
6 month = (CC6 x WB6 - CC5 x WB5]/100
th
7 month = (CC7 x WB7 - CC6 x WB6]/100
th
8 month = (CC8 x WB8 - CC7 x WB7]/100
th
9 month = (CC9 x WB9 - CC8 x WB8]/100
th
10 month = (CC10 x WB10- CC9 x WB9]/100
th
11 month = (CC11 x WB11- CC10x WB10]/100
th
12 month = (CC12 x WB12- CC11x WB 11]/100
Where,
And, WB1, WB2, WB3, WB4, WB5, WB6, WB7, WB8, WB9, WB10, WB11 and
WB12 are the weighted average of percentage allocated capacity share of the
st
nd
rd
th
th
th
th
th
th
th
th
beneficiary during the cumulative period up to 1 , 2 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11
th
and 12 month respectively.
CHAPTER 4
217
INTER-STATE TRANSMISSION
49. Definitions: Unless the context otherwise requires, for the purpose of this chapter,
:(i)
‘Act’ means the Electricity Act, 2003;
(ii)
`Additional Capitalisation' means the capital expenditure actually
incurred after the date of commercial operation of the transmission system and
admitted by the Commission after prudence check subject to regulation 53;
(iii)
'Allotted Transmission Capacity' means the power transfer in MW
between the specified point(s) of injection and point(s) of drawal
allowed to a long-term customer on the inter-state transmission system
under the normal circumstances and the expression "allotment of
transmission capacity" shall be construed accordingly;
Allotted Transmission Capacity to a long-term transmission
customer shall be sum of the generating capacities allocated to the
long-term transmission customer from the ISGS and the contracted
power, if any;
(iv)
'Authority' means Central Electricity Authority referred to in section 70 of
the Act;
(v)
'Availability' in relation to a transmission system for a given period
means the time in hours during that period the transmission system is capable to
transmit electricity at its rated voltage and shall be expressed in percentage of total
hours in the given period and shall be calculated as per the procedure contained in
Appendix-III to these regulations;
(vi)
'Commission' means the Central Electricity Regulatory Commission
referred to in Section 76 of the Act;
(vii)
'Contracted Power' means the power in MW which the transmission
licensee has agreed to carry or which the transmission licensee is
required to carry as per firm allocation from ISGS outside the region or
the long-term agreement between the importing and exporting utility;
(viii)
`Cut off Date' means the date of first financial year closing after one
year of the date of commercial operation of the transmission system.
(ix)
‘Date of Commercial Operation’ or ‘COD’ means the date of charging
the project or part thereof to its rated voltage level or seven days after
the date on which it is declared ready for charging by the transmission
licensee, but is not able to be charged for reasons not attributable to
218
the transmission licensee, its suppliers or contractors.
Provided that the date of commercial operation shall not be a date prior
to the scheduled date of commercial operation mentioned in the
implementation agreement or the transmission service agreement or the
investment approval, as the case may be, unless mutually agreed to by all
parties.
(x)
‘Existing Project’ means the project declared under commercial
operation from a date prior to 1.4.2004;
(xi)
‘Implementation Agreement’ means the agreement, contract or
memorandum of understanding, or any such covenant, entered into between the
transmission licensee and the long-term transmission customers for construction of
the project;
(xii)
‘Inter-State Generating Station’ or ‘ISGS’ has the meaning as assigned in the
Indian Electricity Grid Code approved/notified by the Commission;
(xiii)
'Long-Term Transmission Customer' means a person availing or intending to
avail access to the inter-state transmission system for a period of twenty five
years or more;
(xiv)
`Original Project Cost' means the actual expenditure incurred by the
transmission licensee, as per the original scope of project up to first financial
year closing after one year of the date of commercial operation of the last
element as admitted by the Commission for the purpose of tariff;
(xv)
'Operation and Maintenance Expenses' or 'O&M Expenses' means the
expenditure incurred in operation and maintenance of the transmission
system, including part thereof, and includes the expenditure on manpower,
repairs, spares, consumables, insurance and overheads;
(xvi)
‘Project’ includes the transmission system comprising specified transmission
lines, sub-stations and associated equipment;
(xvii) 'Rated Voltage' means the manufacturers design voltage at which the
transmission system is designed to operate or such lower voltage at which the
line is charged, for the time being, in consultation with long-term transmission
customers;
(xviii) 'Short-Term Transmission Customer' means a transmission customer other
than the long-term transmission customer;
(xix)
'Transmission Service Agreement ' means the agreement, contract,
memorandum of understanding, or any such covenant, entered into between
the transmission licensee and the long-term transmission customers for the
219
operational phase of the project;
(xx)
'Transmission licensee', means a person granted licence for inter-state
transmission of electricity and includes any person deemed to be a
transmission licensee for inter-state transmission of electricity;
(xxi)
' Transmission System' means a line with associated sub-stations or a
group of lines inter-connected together along with associated substations and the term includes equipment associated with transmission
lines and sub-stations;
(xxii) 'Year' means a financial year.
50.
Auxiliary Energy Consumption in the sub-station
(a)
AC System
The charges for auxiliary energy consumption in the AC sub-station for the
purpose of air-conditioning, lighting, technical consumption, etc. shall be borne by the
transmission licensee as part of its normative operation and maintenance expenses.
(b)
HVDC sub-station
For auxiliary energy consumption in HVDC sub-stations, the
Central Government may allocate an appropriate share from one or
more ISGS . Capacity and energy charges for such power shall be
borne by the transmission licensee as part of its normative operation
and maintenance expenses.
51.
Target Availability for recovery of full transmission charges
(1)
(2)
AC system : 98%
HVDC bi-pole links and HVDC back-to-back stations: 95%
Note 1
Recovery of fixed charges below the level of target availability shall be
on pro rata basis. At zero availability, no transmission charges shall be
payable.
Note 2
The target availability shall be calculated in accordance with procedure
specified in Appendix-III.
52. Capital Cost: (1) Subject to prudence check by the Commission, the actual
expenditure incurred on completion of the project shall form the basis for
determination of final tariff. The final tariff shall be determined based on the admitted
capital expenditure actually incurred up to the date of commercial operation of the
transmission system and shall include capitalised initial spares subject to a ceiling
220
norm as 1.5% of original project cost.
Provided that where the implementation agreement or the transmission
service agreement entered into between the transmission licensee and the long-term
transmission customers provides a ceiling of actual expenditure, the capital
expenditure shall not exceed such ceiling for determination of tariff.
(2) In case of the existing projects, the project cost admitted by the Commission prior
to 1.4.2004 shall form the basis for determination of tariff.
Note
Scrutiny of the project cost estimates by the Commission shall be limited to
the reasonableness of the capital cost, financing plan, interest during construction,
use of efficient technology and such other matters for determination of tariff.
53. Additional capitalisation: (1) The following capital expenditure within the original
scope of work actually incurred after the date of commercial operation and up to the
cut off date may be admitted by the Commission, subject to prudence check:
(i)
(ii)
Deferred liabilities;
Works deferred for execution;
(iii)
Procurement of initial capital spares in the original scope of works
subject to the ceiling norm specified in regulation 52;
(iv)
Liabilities to meet award of arbitration or compliance of the order or
decree of a court; and
(v)
On account of change in law.
Provided that original scope of work along with estimates of
expenditure shall be submitted along with the application for provisional tariff.
Provided further that a list of the deferred liabilities and works deferred
for execution shall be submitted along with the application for final tariff after
the date of commercial operation of the transmission system.
(2) Subject to the provisions of clause (3) of this regulation, the capital
expenditure of the following nature actually incurred after the cut off date may be
admitted by the Commission, subject to prudence check:
(i)
Deferred liabilities relating to works/services within the original scope of
work;
(ii)
Liabilities to meet award of arbitration or compliance of the order or
decree of a court;
(iii)
On account of change in law; and
(iv)
Any additional works/services which have become necessary for
efficient and successful operation of the project, but not included in the original
221
project cost.
(3) Any expenditure on minor items/assets brought after the cut off date like
tools and tackles, personal computers, furniture, air-conditioners, voltage stabilizers,
refrigerators, coolers, fans, T.V., washing machine, heat-convectors, mattresses,
carpets, etc shall not be considered for additional capitalisation for determination of
tariff with effect from 1.4.2004.
Note
The list of items is illustrative and not exhaustive.
(4) Impact of additional capitalisation in tariff revision may be considered by the
Commission twice in a tariff period, including revision of tariff after the cut off date.
Note 1
Any expenditure admitted on account of committed liabilities within the original
scope of work and the expenditure deferred on techno-economic grounds but falling
within the original scope of work shall be serviced in the normative debt-equity ratio
specified in regulation 54.
Note 2
Any expenditure on replacement of old assets shall be considered after writing
off the entire value of the original assets from the original capital cost.
Note 3
Any expenditure admitted by the Commission for determination of tariff on
account of new works not in the original scope of work shall be serviced in the
normative debt-equity ratio specified in regulation 54.
Note 4
Any expenditure admitted by the Commission for determination of tariff on
renovation and modernization and life extension shall be serviced on normative debtequity ratio specified in regulation 54 after writing off the original amount of the
replaced assets from the original capital cost.
54. Debt-Equity Ratio: (1) In case of all projects, debt–equity ratio as on the date of
commercial operation shall be 70:30 for determination of tariff. Where equity
employed is more than 30%, the amount of equity for the purpose of tariff shall be
limited to 30% and the balance amount shall be considered as the normative loan.
Provided that in case of the projects where actual equity employed is less
than 30%, the actual debt and equity shall be considered for determination of tariff.
222
(2) The debt and equity amounts arrived at in accordance with clause (i) shall be
used in all calculations for calculating interest on loan, return on equity, Advance
Against Depreciation and Foreign Exchange Rate Variation.
1
Transmission Charges : The tariff for transmission of electricity on inter-state
transmission system shall comprise of the recovery of annual transmission charges
consisting of the following, namely:
56. Computation of Transmission Charges: The annual transmission charges shall
be computed on the following basis, namely:
(i)
Interest on loan Capital
(a) Interest on loan capital shall be computed loan wise on the loans arrived at
in the manner indicated in regulation 54.
(b) The loan outstanding as on 1.4.2004 shall be worked out as the gross loan
as per regulation 54 minus cumulative repayment as admitted by the Commission up
to 31.3.2004. The repayment for the period 2004-09 shall be worked out on
normative basis.
(c) The transmission licensee shall make every effort to swap the loan as long
as it results in net benefit to the long-term transmission customers. The costs
associated with such swapping shall be borne by the long-term transmission
customers.
(d) The changes to the loan terms and conditions shall be reflected from the
date of such swapping and benefits passed on to the beneficiaries.
(e) In case of any dispute, any of the parties may approach the Commission
with proper application. However, the long-term transmission customers shall not
withhold any payment as ordered by the Commission to the transmission licensee
during pendency of any dispute relating to swapping of loan.
(f) In case any moratorium period is availed of by the transmission licensee,
depreciation provided for in the tariff during the years of moratorium shall be treated
as repayment during those years and interest on loan capital shall be calculated
accordingly.
(g) The transmission licensee shall not make any profit on account of
swapping of loan and interest on loan.
(ii) Depreciation, including Advance Against Depreciation
(a) Interest on loan capital;
(b) Depreciation, including Advance Against Depreciation;
(c) Return on equity;
(d) Operation and maintenance expenses; and
(e) Interest on working capital.
(a) Depreciation
For the purpose of tariff, depreciation shall be computed in the following
223
manner, namely:
(i) The value base for the purpose of depreciation shall be the historical cost of
the asset.
(ii) Depreciation shall be calculated annually based on straight line method
over the useful life of the asset and at the rates prescribed in Appendix II to these
regulations.
The residual life of the asset shall be considered as 10% and
depreciation shall be allowed up to maximum of 90% of the historical
capital cost of the asset. Land is not a depreciable asset and its cost
shall be excluded from the capital cost while computing 90% of the
historical cost of the asset. The historical capital cost of the asset shall
include additional capitalisation on account of Foreign Exchange Rate
Variation up to 31.3.2004 already allowed by the Central
Government/Commission.
(iii) On repayment of entire loan, the remaining depreciable value shall
be spread over the balance useful life of the asset.
(iv) Depreciation shall be chargeable from the first year of operation. In
case of operation of the asset for part of the year, depreciation shall be
charged on pro rata basis.
(b) Advance Against Depreciation
In addition to allowable depreciation, the transmission licensee
shall be entitled to Advance Against Depreciation, computed in the
manner given hereunder:
AAD = Loan repayment amount as per regulation 56 (i) subject to a
th
ceiling of 1/10 of loan amount as per regulation 54 minus depreciation
as per schedule
Provided that Advance Against Depreciation shall be permitted only if
the cumulative repayment up to a particular year exceeds the cumulative
depreciation up to that year;
Provided further that Advance Against Depreciation in a year shall be
restricted to the extent of difference between cumulative repayment and
cumulative depreciation up to that year.
(iii) Return on Equity:
Return on equity shall be computed on the equity base determined in
accordance with regulation 54 and shall be @ 14% per annum.
224
Provided that equity invested in foreign currency shall be allowed a
return up to the prescribed limit in the same currency and the payment on this
account shall be made in Indian Rupees based on the exchange rate
prevailing on the due date of billing.
Explanation
The premium raised by the transmission licensee while issuing share capital
and investment of internal resources created out of free reserve of the existing
transmission licensee, if any, for the funding of the project, shall also be reckoned as
paid up capital for the purpose of computing return on equity, provided that such
premium amount and internal resources are actually utilised for meeting the capital
expenditure of the project and forms part of the approved financial package.
(iv) Operation and Maintenance expenses
(a) Norms for operation and maintenance expenses per ckt-km and per bay
shall be as under, namely:
Norms for O&M expenses per ckt-km and per bay
O&M expenses
(Rs. in lakh per
ckt-km)
O&M expenses
(Rs. in lakh per
bay)
200405
0.227
200506
0.236
200607
0.246
200708
0.255
Year
200809
0.266
28.12
29.25
30.42
31.63
32.90
(b) The total allowable O&M expenses for a transmission licensee shall
be calculated by multiplying the number of bays and ckt-km of line
length with the applicable norms for the O&M expenses per bay and
per ckt-Km respectively.
(v) Interest on Working Capital
(1) Working capital shall cover:
(a)
Operation and maintenance expenses for one month;
(b)
Maintenance spares @ 1% of the historical cost escalated @ 6% per
annum from the date of commercial operation; and
(c)
Receivables equivalent to two months of transmission charges
calculated on target availability level.
(2) Rate of interest on working capital shall be on normative basis and shall be
equal to the short-term Prime Lending Rate of State Bank of India as on 1.4.2004 or
st
on 1 April of the year in which the project or part thereof (as the case may be) is
declared under commercial operation, whichever is later. The interest on working
225
capital shall be payable on normative basis notwithstanding that the transmission
licensee has not taken working capital loan from any outside agency.
1
Payment of Transmission Charges : Full annual transmission charges shall be
recoverable at the target availability stipulated in regulation 51. Payment of
transmission charges below the target availability shall be on pro rata basis. The
transmission charges shall be calculated on monthly basis.
2
Sharing of charges for intra-regional assets: In case of more than one long-term
transmission customer of the regional transmission system, the monthly transmission
charges leviable on each long-term transmission customer shall be computed as per
the following formula:
Transmission Charges for intra-regional system payable for a month by a
long-term transmission customer of that transmission system
n
=
[ ∑{ }
i=1
Where TCi =
TCi
12
- TRSC
]
X CL
SCL
th
Annual Transmission Charges for the i project in the region
computed in accordance with regulation 56
n = Number of projects in the region
TRSC = Total recovery of transmission charges for the month
from Short-term transmission customers for the regional
transmission system in accordance with the Central
Electricity Regulatory Commission (Open Access in InterState Transmission) Regulations, 2004.
CL = Allotted Transmission Capacity to the long-term transmission
customer
SCL = Sum of the Allotted Transmission Capacities to all the longterm transmission customers of the regional transmission
system.
59. Sharing of charges for inter-regional assets: The transmission charges of
the inter-regional assets, including HVDC system , after deducting the recovery
from the short-term customers, shall be shared in the ratio of 50:50 by the longterm transmission customers of the regional transmission system of two contiguous
regions in accordance with the following formula:
226
Transmission Charges payable for a month by a long term-customer
within the region for the inter-regional assets connected to that region
Where
TCj
= Annual Transmission Charges for the particular inter-regional asset
connected to the region computed in accordance with regulation 56,
RSCj
= Recovery of Transmission Charges for the month from the short-term
customers for the particular inter-regional asset connected to the region in
accordance with the Central Electricity Regulatory Commission (Open
Access in Inter-State Transmission) Regulations, 2004,
CL
= Allotted Transmission Capacity to the long-term transmission customer in
the regional transmission system in which it is located,
SCL
= Sum of the Allotted Transmission Capacities to all the long-term
transmission customers of the regional transmission system in the regional
transmission system in which it is located.
60. Incentive : (1) The transmission licensee shall be entitled to incentive on
achieving annual availability beyond the target availability as per regulation 51, in
accordance with the following formula:
Incentive
=
Annual Transmission Charges x [Annual availability achieved
– Target Availability] / Target Availability ;
Where,
Annual transmission Charges shall correspond to intra-regional assets or for a
particular inter-regional asset, as the case may be.
227
Provided that no incentive shall be payable above the availability of 99.75%
for AC system and 98.5% for HVDC system.
(2) Incentive shall be shared by the long-term customers in the ratio of their
average allotted transmission capacity for the year.
1
Rebate : For payment of bills of transmission charges through letter of credit on
presentation, a rebate of 2% shall be allowed. Where payments are made
subsequently through opening of letter of credit or otherwise, but within a period of
one month of presentation of bills by the Transmission licensee, a rebate of 1% shall
be allowed.
2
Late payment surcharge : In case the payment of bills of transmission charges by
the beneficiary (s) is delayed beyond a period of 1 month from the date of billing a
late payment surcharge at the rate of 1.25% per month shall be levied by the
transmission licensee.
(A.K. SACHAN)
SECRETARY
228
Tariff Filing Forms (Thermal) (26.3.2004)
229
Open Access in Inter-state Transmission / CERC (30.01.2004) & (1st
Amendment) Regulations, 2005 dated 21st February, 2005
CENTRAL ELECTRICITY REGULATORY COMMISSION
NEW DELHI
NOTIFICATION
No. L-7/25(4)-2003
Dated the 30th January 2004
In exercise of powers conferred by Section 178 of the Electricity Act, 2003 and all
other powers enabling in this behalf, and after previous publication, the Central Electricity
Regulatory Commission, hereby makes the following regulations, namely:-
Short Title and Commencement
1.
(i)
These regulations may be called the Central Electricity Regulatory
Commission (Open Access in Inter-state Transmission) Regulations, 2004.
(ii)
(a)
These regulations, except Clause (iii) of Regulation 6 shall come into
force from the date of their publication in the Official Gazette;
(b)
Clause (iii) of Regulation 6 of these regulations shall come into force
after expiry of 90 days from the date of publication of these regulations in the
Official Gazette and during this period of 90 days, reservation for short-term
customers shall be done on first-come-first-served basis:
Provided that the period for such reservation shall not exceed the
period of 90 days from the date of publication of these regulations in the
Official Gazette.
230
Definitions
2.
In these regulations, unless the context otherwise requires, (a)
"Act" means the Electricity Act, 2003 (36 of 2003);
------------------------------------------------------------------------------------------------------------Amended vide notification No.L-7/25(5)/2003-CERC dated 21st February, 2005
(Amendments shall be effective from 1.4.2005)
(b)
“Allotted Transmission Capacity” means the power transfer in MW between
the specified point(s) of injection and point(s) of drawal allowed to a longterm customer on the inter-state transmission system under normal
circumstances and the expression "allotment of transmission capacity" shall be
construed accordingly;
(c)
"Commission" means Central Electricity Regulatory Commission referred to
in Section 76 of the Act;
(ca)
“Day” means a day starting at 00.00 hours and ending at 24.00 hours;
(d)
"Direct customer" means a person directly connected to the system owned or
operated by the Central Transmission Utility;
(e)
(f)
"Embedded customer" means a person who is not a direct customer;
“Existing beneficiary” means a person having firm allocation from a central
power generating station on the date of coming into force of these regulations
and who has entered into Bulk Power Transmission Agreement with the
Central Transmission Utility;
"Grid Code" means the Grid Code specified by the Commission under Clause
(h) of sub-section (1) of Section 79 of the Act and includes the Indian
Electricity Grid Code applicable on the date of commencement of these
regulations;
(g)
(ga)
"Month" means a calendar month as per the British calendar;
(h)
"Nodal agency" means the nodal agency defined in regulation 8 of these
regulations;
(i)
"Open access customer" means a consumer permitted by the State
Commission to receive supply of electricity from a person other than
distribution licensee of his area of supply, or a generating company (including
231
captive generating plant) or a licensee, who has availed of or intends to avail
of open access;
(j)
“Reserved Transmission Capacity” means the power transfer in MW between
the specified point(s) of injection and point(s) of drawal allowed to a shortterm customer on the transmission system depending on availability of
transmission capacity and the expression "reservation of transmission
capacity" shall be construed accordingly;
(k)
“Transmission Customer” means any person, including open access customer
using transmission system of a transmission licensee;
(ka)
“working day” means a day on which banks are open for business;
(l)
Words and expressions used and not defined in these regulations but defined in
the Act or the Grid Code, shall have the meaning assigned to them under the
Act or the Grid Code, as the case may be.
Extent of Application
3.
4.
These regulations shall apply for access to inter-state transmission system.
Categorisation of Transmission Customers
(i)
The transmission customers shall be divided into two categories, namely: (a)
Long-term customers, and
(b)
Short-term customers.
(ii)
The persons availing or intending to avail access to the inter-state transmission system
for a period of twenty five years or more shall be the long-term customers:
Provided that the existing beneficiaries of a regional transmission system
owned or operated by the Central Transmission Utility shall be deemed to be the longterm customers of the particular regional system owned or operated by the Central
Transmission Utility for the purpose of these regulations.
(iii)
The transmission customers other than the long-term customers shall be the short-term
customers:
Criteria for allowing transmission access
5.
(i)
The long-term access shall be allowed in accordance with the transmission
planning criterion stipulated in the Grid Code;
(ii)
The short-term access shall be allowed, if request can be accommodated by utilising: 232
(a) Inherent design margins;
(b) Margins available due to variation in power flows; and
(c) Margins available due to in-built spare transmission capacity created to
cater to future load growth.
Criteria for Allotment and Reservation of Transmission Capacity
6.
(i)
Allotment priority of a long-term customer shall be higher than
reservation priority of a short-term customer.
(ii)
Within a category (long-term or short-term), there shall be no discrimination
between open access customers and self-use by an integrated utility like
the State Electricity Board.
(i)
In case of inter-regional transactions, reservation of transmission capacity to
the short-term customer may be reduced or cancelled by the Regional Load
Despatch Centre, if the Central Government allocates power from the Central
Generating Station or Stations in a region to a person in another region and
such allocation, in the opinion of the Regional Load Despatch Centre, cannot
otherwise be implemented due to congestion in the inter-regional link. If the
Regional Load Despatch Centre decides to reduce or cancel transmission
capacity reserved for a short-term customer under this clause, it shall, as soon
as possible, intimate the short-term customer concerned of its decision to
reduce or cancel transmission capacity.
(ii)
The applications for grant of short-term access shall be processed only if such
short-term access is commencing in the first month to the fourth month and is
not ending beyond the fourth month, taking the month in which application is
made as the first month.
(iii) The applications for grant of short-term access received in a month for open
access commencing and terminating in the month in which the application is
made or received after the nineteenth day of a month for open access
commencing and terminating in the following month shall be treated on firstcome-first-served basis, and short-term access shall be granted subject to
availability of the transmission capacity.
(iv)
All applications for short-term access, other than the applications for shortterm access to be processed on first-come-first-served basis in accordance
with clause (v) above, received up to the nineteenth day of a month shall be
considered together on the twentieth day of that month for advance reservation
and shall be processed in the manner given hereunder, namely:(a) The applications shall be analysed to check for congestion on any of the
transmission corridors to be used for short-term access.
(b) In case the nodal Regional Load Despatch Centre does not anticipate
congestion on any of the transmission corridors involved, the applicants
shall be granted short-term access for the quantum and duration sought,
latest by the twenty-fifth day of the month.
(c) If in the opinion of the nodal Regional Load Despatch Centre, grant of
short-term access to all the applicants is likely to lead to congestion in one
233
or more of the transmission corridors to be used for short-term access for
any duration, it shall inform the applicants of its opinion accordingly and
the reasons therefor on or before the twenty-third day of the month.
(d) On receipt of intimation in accordance with sub-clause (c) above, an
applicant may reduce its requirement of transmission capacity during the
period of congestion or opt for access only for the duration when no
congestion is anticipated and in such a situation, he shall inform the nodal
Regional Load Despatch Centre accordingly by the twenty-fifth day of the
month.
(e) If the nodal Regional Load Despatch Centre still anticipates congestion in
one or more of the transmission corridors to be used for short-term access,
it shall invite electronic-bids for reservation of transmission capacity of the
congested transmission corridor in accordance with Regulation 14 of these
regulations on the twenty-sixth day of the month. Non-participation of an
applicant in the bidding process shall be construed that he is no longer
interested in open access and his application shall not be processed.
(v)
(vi)
(vii)
In the event of a reserved transmission corridor subsequently becoming fully
or partly vacant for certain duration in a month, the Regional Load Despatch
Centre shall display this information in public domain on its website.
Except as provided in clause (iii), once open access has been granted, the longterm customer or the short-term customer shall not be replaced by any other
person on account of a subsequent request received from such other person.
The Regional Load Despatch Centres shall lay down a detailed procedure for
reservation of transmission capacity to the short-term customers after obtaining
prior approval of the Commission, which shall include the detailed procedure
for inviting bids, advance reservation, reservation on first-come-first-served
basis, usage of alternate route through other regions if direct inter-regional
links between two regions are congested or constrained and any other residual
matter. Any further revision of the procedure shall be carried out only after
obtaining prior approval of the Commission.
Declaration of Long-term Open Access
7.
Every transmission licensee shall declare the existing long-term customers using its
transmission system (including self-use and use by unbundled agencies which were
previously integrated) either on its website or on the website of the Regional Load Despatch
Centre or the State Load Despatch Centre concerned latest by the thirtieth day of June 2005.
Nodal Agency
8.
(i)
The nodal agency for arranging the long-term transmission access shall be the
Central Transmission Utility if it's system is used, otherwise the nodal agency
shall be transmission licensee in whose system the point of drawal of
electricity is situate;
234
(ii)
The nodal agency for the short-term transmission access shall be the Regional Load
Despatch Centre of the region where point of drawal of electricity is situate.
Procedure for Long-Term Customer
9.
(i)
An application for long-term access shall be submitted to the nodal agency;
(ii)
The application shall contain the details, such as capacity needed, point(s) of
injection, point(s) of drawal, duration of availing open access, peak load, average load
and such other additional information that may be specified by the nodal agency:
Provided that the nodal agency shall issue necessary guidelines, procedure and
application forms within 30 days of commencement of these regulations.
(iii) The application shall be accompanied by a non-refundable application fee of
Rs one lakh payable in the name and in the manner to be decided by the nodal agency;
(iv)
Based on system studies conducted in consultation with other agencies
involved including other transmission licensees, the nodal agency shall, within 30
days of receipt of the application, intimate to the applicant whether or not the longterm access can be allowed without further system strengthening:
Provided that where the long-term access can be allowed without further
system strengthening, this shall be allowed immediately after entering into
commercial agreements.
(v)
If, in the opinion of the nodal agency, further system strengthening is essential
before providing the long-term access, the applicant may request the nodal agency to
carry out the system studies and preliminary investigation for the purpose of cost
estimates and completion schedule for system strengthening;
(vi)
The nodal agency shall carry out the studies immediately on receipt of request
from the applicant under clause (v) above and intimate results of the studies within 90
days of receipt of request from the applicant;
(vii) The applicant shall reimburse the actual expenditure incurred by the nodal
agency for system strengthening studies:
Provided that the fee of rupees one lakh paid by the applicant shall be adjusted
against the actual expenditure to be reimbursed by the applicant.
10.
The allotment of transmission capacity to a long-term customer may be relinquished
or transferred to any other long-term customer in accordance with regulation 12 of these
regulations.
235
Bulk Power Transmission Agreement
11.
A long-term customer shall enter into Bulk Power Transmission Agreement with the
transmission licensee for use of inter-state transmission system.
Exit Option
12.
(i)
A long-term customer shall not relinquish or transfer his rights and obligations
specified in the Bulk Power Transmission Agreement, without prior approval of the
Commission.
(ii)
The relinquishment or transfer of rights and obligations by a long-term
customer shall be subject to payment of compensation, as may be determined by the
Commission.
Procedure for Short-Term Customer
13.
(i)
A short-term customer shall submit an application for transmission access to
the nodal Regional Load Despatch Centre;
(ii)
The application shall contain the details, such as capacity needed, point or
points of injection, point or points of drawal, duration for availing of open access,
peak load, average load and such other additional information that may be laid down
by the Regional Load Despatch Centre;
(iii)
The application shall be accompanied by a non-refundable application fee of Rupees
five thousand only;
Provided that in case of application for access on the date of the application or
on the following day, the application fee may be deposited within next three working
days of making of application.
(iv)
The reserved transmission capacity shall not be transferred by a short-term customer
to any other customer.
Bidding Process for Short-term Access
13A. (i)
(i)
The floor price for bidding shall be the ST_RATE determined in accordance
with Regulation 16 of these regulations.
The bidders shall quote price in terms of the floor price.
236
(ii)
(iii)
(iv)
(v)
No bidder shall be allowed to quote price which is more than five times the
floor price in case of intra-regional transmission system and more than a two
and a half times the floor price in case of inter-regional transmission system.
Reservation of transmission capacity shall be made in decreasing order of the
price quoted.
In case of equal price quoted by two or more bidders, the reservation of
transmission capacity shall be made pro rata to the transmission capacity
sought to be reserved.
The short-term customer getting reservation for capacity less than the capacity
sought by him shall pay the charges quoted by him and the short-term
customers getting transmission capacity reservation equal to the capacity
sought to be reserved, shall pay the charges quoted by the last customer getting
reservation of transmission capacity.
Non-Utilisation of reserved transmission capacity by Short-term Customer
14.
(i)
In case a short-term customer is unable to utilise, full or substantial part of the
reserved transmission capacity, he shall inform the nodal Regional Load
Despatch Centre along with reasons for his inability to utilise the reserved
transmission capacity and may surrender the reserved transmission capacity.
(ii)
Notwithstanding any thing contained in these regulations, the Regional Load
Despatch Centre may on its own reduce or cancel the reserved transmission
capacity of a short-term customer when such a short-term customer frequently
underutilises the reserved transmission capacity:
Provided that the reserved transmission capacity shall not be reduced or
cancelled under this clause without a prior notice to the short-term customer
whose reserved transmission capacity is sought to be reduced or cancelled.
(iii)
The short-term customer, who has surrendered the reserved transmission
capacity under clause (i) or whose reserved transmission capacity has been
reduced or cancelled under clause (ii), shall bear the transmission charges and
the operating charge based on the original reserved transmission capacity for
seven days or the period of reservation surrendered or reduced or cancelled, as
the case may be, whichever period is shorter.
Note
For the purpose of this clause, the expression “operating charge” shall have the
same meaning as assigned to it under Regulation 17.
(iv)
The transmission capacity becoming available as a result of surrender by the
short-term customer under clause (i) or as a result of reduction or cancellation
of the reserved transmission capacity by the Regional Load Despatch Centre
237
under clause (ii), may be reserved for any other short-term customer in
accordance with these regulations.
Treatment of Existing Transactions
15.
Any person granted open access before commencement of the Central Electricity
Regulatory Commission (Open Access in Inter-state Transmission) Regulations, (First
Amendment) Regulations, 2005 shall not be disturbed till expiry of the period for which open
access has been granted.
Transmission Charges
16.
The transmission charges for use of the transmission system of the transmission
licensee for inter-state transmission shall be regulated as under, namely:(i)
(ii)
(iii)
The annual transmission charges payable by a long-term customer for use of
the transmission system shall be determined in accordance with the terms and
conditions of tariff notified by the Appropriate Commission from time to time
and after deducting the adjustable revenue received from the short-term
customers, these charges shall be shared by the long-term customers.
The transmission charges payable by a short-term customer shall be calculated
in accordance with the following methodology, namely:(a) Intra-regional system
ST_RATE = 0.25 x [TSC/ Av_CAP]/ 365
(b) Inter-regional system
ST_RATE = 0.50 [ TSC/ CIR]/365
Where:
ST_RATE is the rate for short-term customer in Rs per MW per day.
Note
ST_RATE shall be calculated and applied for each regional transmission
system, inter-regional transmission link, and transmission system of the State
Transmission Utility or any other transmission licensee forming part of the
inter-state transmission system.
"TSC" means the annual transmission charges or annual revenue requirement
on account of the transmission system for the previous financial year as
determined by the Appropriate Commission.
"Av_CAP" means the average capacity in MW served by the intra-regional
transmission system of the transmission licensee in the previous financial year
and shall be the sum of the generating capacities connected to the transmission
system and contracted capacities of other long-term transactions handled by
the system of the transmission licensee.
“CIR” means the transmission capacity of the inter-regional system
The transmission charges payable by a short-term customer in case of
uncongested transmission corridor shall be levied as under, namely :(a) Up to 6 hours in a day in one block : 1/4th of ST_RATE
238
(b) More than 6 hours and up to 12 hours in a day in one block : 1/2 of
ST_RATE
(c) More than 12 hours and upto 24 hours in a day in one block : equal to ST _
RATE
(iv) Non-determination of annual transmission charges for the transmission system
shall not be a ground for delay in providing short-term access and where annual
transmission charges for any transmission licensee are not determined under the
Act, ST _ RATE applicable for the system owned by the Central Transmission
Utility of the region in which the system of transmission licensee is situate, shall
be applied for determination of the charges for the short-term customer.
(ii)
Every transmission licensee shall declare ST _ RATE, calculated in
accordance with clause (ii) above, which shall remain fixed for a period of one
year.
(vi)
If the transmission system belongs to the Central Transmission Utility or State
Transmission Utility, 25% of the charges collected from the short-term
customer for use of its intra-regional transmission system and 12.5% of the
charges collected from the short-term customers for use of its inter-regional
system shall be retained by the Central Transmission Utility or State
Transmission Utility and the remaining part of these charges shall be adjusted
towards reduction in the transmission charges payable by the long-term
customers.
(vii) Open access charges specified in this regulation shall not be applicable for the interstate transmission system in North-Eastern Region. The charges for use of the inter-state
transmission in this region shall be regulated under the separate orders of the Commission
issued from time to time.
Operating Charge
17.
(i) A composite operating charge @ Rs.3,000/- per day or part of the day and
@ Rs 1,000/- per day or part of the day shall be payable by a short-term
customer for each transaction to the each of the Regional Load Despatch Centre
involved and State Load Despatch Centre respectively.
Note 1
The operating charge includes fee for scheduling and system operation,
fee for affecting revisions in schedule on bonafide grounds and collection and
disbursement charges.
Note 2
239
The operating charge collected by the Regional Load Despatch Centre in
accordance with Clause (i) shall be in addition to the fees and charges specified
by the Commission under sub-section (4) of Section 28 of the Act.
Explanation
Operating charge shall be payable by a generating company when it is granted shortterm access under these regulations.
Unscheduled Inter-change (UI) charges
18.
(i)
The mismatch between the scheduled and the actual drawal at drawal point(s)
and scheduled and the actual injection at injection point(s) shall be met from the grid
and shall be governed by UI pricing mechanism applicable to the inter-state
transactions;
(ii)
A separate bill for UI charges shall be issued to the direct customers and in
case of the embedded customers, a composite UI bill for the State as a whole shall be
issued, the segregation for which shall be done at the State level.
Reactive Energy Charges
19.
The payment and receipt of the reactive energy charges by the direct customers on
account of open access shall be calculated in accordance with the scheme applicable to
transactions involving inter-state transmission approved by the Commission from time to
time.
20.
The reactive energy charges payable to or receivable by the State Electricity Board or
the State Transmission Utility shall be paid to or received from the pool by the State
Electricity Board or the State Transmission Utility concerned and shall not be apportioned to
the embedded customers.
21.
The reactive energy drawals and injections by the embedded customers shall be
governed by the regulations applicable within the State concerned.
Time-schedule for Processing Application
22
(i) In addition to the time schedule prescribed under regulation 6 for processing of
applications for advance reservation, as far as practicable, the following time
schedule shall be adhered to by the respective nodal agency for processing of the
application for grant of access, namely:240
S.No.
1.
2.
(ii)
Type of service/activity
Short-term Service (for the period to be treated on firstcome-first-served basis)
Up to one week
More than a week
Long-term Service
Intimation regarding feasibility of access without system
strengthening
Intimation of results of studies for system strengthening
with cost estimates and completion schedule
Maximum Processing
time
2 days
3 days
30 days
90 days
Day ahead transactions:
(a) The advance payment of transmission charges, operating charge and
application fee shall not be insisted upon. These payments can be made
within 3 working days of making of application.
(b) A composite request for open access and scheduling shall be sent to the
nodal Regional Load Despatch Centre through the State Load Despatch
Centre concerned latest by 3.00 PM. The nodal Regional Load Despatch
Centre shall take steps to incorporate the request for open access in the
schedules to be issued by the Regional Load Despatch Centres concerned,
if the request can be accommodated without causing congestion.
(c) A composite request for open access and scheduling to utilise surpluses
known after issuance of the first despatch schedule by Regional Load
Despatch Centres at 5.00 PM, must be submitted to the nodal Regional
Load Despatch Centre latest by 10.00 PM or preferably earlier. The nodal
Regional Load Despatch Centre shall endeavour to incorporate the same in
the revised despatch schedule to be issued by the Regional Load Despatch
Centres concerned, if the request can be accommodated without causing
congestion.
(iii)
Same Day transactions
(a) The advance payment of transmission charges, operating charge and
application fee shall not be insisted upon. These payments can be made
within 3 working days of making of application.
(b)
In the event of emergency, the beneficiaries/buying utility may locate a
source of power to meet short-term emergency requirement on the
same day and forward request for open access to the nodal Regional
Load Despatch Centre through the concerned State Load Despatch
Centre. The Regional Load Despatch Centres shall endeavour to
accommodate such emergency requests as soon as and to the extent
practically feasible.
241
Curtailment Priority
23.
When because of transmission constraints or otherwise, it becomes necessary to
curtail the transmission service of the transmission customers, the short-term customers shall
be curtailed first followed by the long-term customers:
Provided that within a category, all users shall have same curtailment priority and
shall be curtailed pro rata to the allotted transmission capacity in the case of long-term
customers and the reserved transmission capacity in the case of short-term customers.
Transmission Charges for short-term customers in case of curtailment
23A. In case of curtailment of more than 50% of the reserved transmission capacity by the
Regional Load Despatch Centre on any particular day on account of transmission constraints,
the transmission charges for that day shall be payable by the short-term customers on pro rata
basis in accordance with the transmission capacity actually provided.
Commercial Conditions
24.
(i)
Short-term customers
(a)
The transmission charges and operating charge shall be paid to the
nodal Regional Load Despatch Centre on monthly basis.
(b)
Advance payment for one month or period of access,
whichever period is shorter, shall be made within three working days of
grant of access.
(c)
Subsequent payments shall be made at least one day before beginning of
next month.
(d)
Payment shall be made either through cheque/demand draft payable at
the location of the nodal Regional Load Despatch Centre or through
electronic transfer.
(e)
If duration of access granted exceeds one month, the short- term
customer shall provide an irrevocable back up letter of credit within
seven days of commencement of open access.
(f)
In case of non-receipt of payment within the period specified in clause
(b) or (c) above, the nodal Regional Load Despatch Centre shall, in its
discretion, have the right to invoke the letter of credit or cancel the
reserved transmission capacity.
242
(ii)
Long-term customers
The commercial conditions for the long-term customer shall be same as
applicable to the existing beneficiaries.
Special Energy Meters
25.
The Special Energy Meters shall be installed by the Central Transmission Utility for
and at the cost of the direct customers and by the concerned State Transmission Utility for
and at the cost of the embedded customers.
26.
The Special Energy Meters installed shall be capable of time differentiated
measurements (15 minutes) of active energy and voltage differentiated measurement of
reactive energy as specified by the Central Transmission Utility or the Regional Load
Despatch Centre.
27.
The Special Energy Meters shall be always maintained in good condition.
28.
The Special Energy Meters for the direct customer shall be open for inspection by any
person authorised by the Central Transmission Utility or the Regional Load Despatch Centre.
Energy losses
29.
The transmission customers shall bear average energy losses in the transmission
system as estimated by the Regional Load Despatch Centre and the State Load Despatch
Centre concerned. The energy losses in the transmission system shall be compensated by
additional injection at the injection point(s). The information regarding average energy losses
for the previous 52 weeks shall be posted on the website of the Regional Load Despatch
Centres and the State Load Despatch Centres.
Compliance of Grid Code
30.
The open access customers shall comply with the provisions of the Grid Code in force
from time to time.
Collection and Disbursement of charges
31.
(i)
(ii)
(iii)
The transmission charges in respect of the long-term customers shall be payable
directly to the respective transmission licensee.
The operating charge and the transmission charges payable by the short-term
customers shall be collected and disbursed by the nodal Regional Load
Despatch Centre.
In case the transmission system owned by the State Transmission Utility is
internalised, the transmission charges under Regulation 16 of these regulations
243
and the operating charge payable under clause (i) of Regulation 17 to be
collected by the nodal Regional Load Despatch Centre, shall not include the
charges for the transmission system owned by the State Transmission Utility
and operating charge payable to the State Load Despatch Centre.
(iv)
The collection and disbursement of the unscheduled inter-change charges and
the reactive energy charges shall be governed in accordance with the procedure
and methodology specified by the Commission from time to time.
Information System
32.
Each Regional Load Despatch Centre and State Load Despatch Centre shall post
following information on their websites in a separate web-page titled “Open access
information” :
(i)
(ii)
Floor rate in rupees per MW per day for the short-term customers (ST_RATE)
for each - (a) regional system; (b) inter-regional link, and (c) system of the
State Transmission Utility or the State Electricity Board or any other
transmission licensee with detailed calculations in support of such rate in
respect of all the transmission licensees situate within the region or the State
concerned;
A status report on the current short-term customers indicating:(a)
Name of customer;
(b)
Period of the access granted (start date and end date);
(c)
Point(s) of injection;
(d)
Point(s) of drawal;
(e)
Transmission systems used (in terms of region and ownership);
(f)
Reserved transmission capacity; and
(g)
Applicable rate (Rs per MW per day).
Note
The status report shall be updated upon every change in status.
(iii)
Month-wise and year-wise report on past short-term customers indicating:
(a)
Name of the customer;
(b)
Period of the access granted (start date and end date);
(c)
Point(s) of injection;
(d)
Point(s) of drawal;
(e)
Transmission systems used (on the basis of region and ownership);
(f)
Reserved transmission capacity;
(g)
Applicable rate (Rs per MW per day); and
(h)
Actual load factor.
Note
244
All previous reports shall also be available in the web-archives.
(iv)
Information regarding usage of the inter-regional links and the interface
between the Central Transmission Utility and state systems (in case of the
Regional Load Despatch Centre) and inter-state links (in case of State Load
Despatch Centre) indicating:
(a)
Time of updating;
(b)
Name of the link;
(c)
Total transmission capacity of the link;
(d)
Scheduled capacity use (giving customer-wise break-up); and
(e)
Current capacity of the link in use.
Note
This information should be updated at least on hourly basis, and where ever
feasible on 15 minute basis.
(v)
The information regarding average energy losses for the previous 52 weeks.
33.
The publication of the web-based information system shall commence within 30 days
from the date of commencement of these regulations in case of the Regional Load Despatch
Centres and within 180 days from the date of commencement of these regulations in case of
the State Load Despatch Centres. Each transmission licensee shall make available the above
information to the Regional Load Despatch Centre or State Load Despatch Centre concerned.
34.
All transmission licensees shall declare current long-term customers using their
system (including self-use and use by unbundled agencies which were previously integrated)
with details thereof either on their own websites or on the website of the Regional Load
Despatch Centre or the State Load Despatch Centre concerned, within 180 days from the date
of commencement of these regulations.
Note
This list shall be updated as and when change in status takes place.
Redressal Mechanism
35.
All complaints regarding unfair practices, delays, discrimination, lack of information,
supply of wrong information or any other matter related to open access in inter-state
transmission shall be directed to the Member Secretary, Regional Electricity Board or
Regional Power Committee, as the case may be, of the region in which the authority against
whom the complaint is made, is located. The Member Secretary, Regional Electricity Board
or the Regional Power Committee, as the case may be, shall investigate and endeavour to
resolve the grievance:
245
Provided that any matter which the Member Secretary, Regional Electricity Board or
the Regional Power Committee, as the case may be, is unable to resolve, shall be reported to
the Commission for a decision.
Coordination
36.
The responsibilities assigned to the Regional Load Despatch Centres of formulation of
procedures, guidelines and application forms under these regulations shall be coordinated by
the Central Transmission Utility.
A.K. SACHAN
SECRETARY
246
CENTRAL ELECTRICITY REGULATORY COMMISSION
New Delhi – 110 003.
No. L-7/25(5)/2003-CERC
21st February, 2005
In exercise of powers conferred under Section 178 of the Electricity Act, 2003 (36 of
2003), and all other powers enabling in this behalf, and after previous publication, the Central
Electricity Regulatory Commission hereby makes the following regulations to amend the
Central Electricity Regulatory Commission (Open Access in Inter-state Transmission)
Regulations, 2004 (hereinafter referred to as “the principal regulations”), namely:1.
Short title and commencement:
(1) These regulations may be called the
Central Electricity Regulatory Commission (Open Access in Inter-state Transmission) (First
Amendment) Regulations, 2005.
(2)
These regulations shall come into effect on 1.4.2005.
2.
Amendment of Regulation 2 of the principal regulations – Definitions:
(i)
Insertion of new Clause (ca). After clause (c) of Regulation 2 of the principal
regulations, the following shall be inserted, namely:“(ca)
“Day” means a day starting at 00.00 hours and ending at 24.00 hours;”
(ii)
Insertion of new Clause (ga). After clause (g) of Regulation 2 of the
principal regulations, the following shall be inserted, namely:“(ga) "Month" means a calendar month as per the British calendar;”
(iii) Insertion of new clause (ka) after clause (k) of Regulation 2 of the principal
regulations, the following shall be inserted, namely :(ka) “working day” means a day on which banks are open for business;
(iv) Amendment of clause (i). Clause (i) of Regulation 2 of the principal regulations
shall be substituted as hereunder, namely:"Open access customer" means a consumer permitted by the State
Commission to receive supply of electricity from a person other than
distribution licensee of his area of supply, or a generating company (including
captive generating plant) or a licensee, who has availed of or intends to avail
of open access;”
3.
Omission of provisos to Clause (iii) of Regulation 4 of the principal regulations.
First and second provisos to clause (iii) of Regulation 4 of the principal regulations shall be
omitted.
247
4.
Amendment of Regulation 6 of the principal regulations. Regulation 6 of the
principal regulations shall be substituted as hereunder, namely:“ Criteria for Allotment and Reservation of Transmission Capacity
6.
(i)
Allotment priority of a long-term customer shall be higher than
reservation priority of a short-term customer.
(ii)
Within a category (long-term or short-term), there shall be no
discrimination between open access customers and self-use by an
integrated utility like the State Electricity Board.
(iii)
In case of inter-regional transactions, reservation of transmission
capacity to the short-term customer may be reduced or cancelled by the
Regional Load Despatch Centre, if the Central Government allocates
power from the Central Generating Station or Stations in a region to a
person in another region and such allocation, in the opinion of the
Regional Load Despatch Centre, cannot otherwise be implemented due
to congestion in the inter-regional link. If the Regional Load Despatch
Centre decides to reduce or cancel transmission capacity reserved for a
short-term customer under this clause, it shall, as soon as possible,
intimate the short-term customer concerned of its decision to reduce or
cancel transmission capacity.
(iv)
The applications for grant of short-term access shall be processed only
if such short-term access is commencing in the first month to the
fourth month and is not ending beyond the fourth month, taking the
month in which application is made as the first month.
(v)
The applications for grant of short-term access received in a month for
open access commencing in the month in which the application is
made or received after the nineteenth day of a month for open access
commencing and terminating in the following month shall be treated on
first-come-first-served basis, and short-term access shall be granted
subject to availability of the transmission capacity.
(vi)
All applications for short-term access, other than the applications for
short-term access to be processed on first-come-first-served basis in
accordance with clause (v) above, received up to the nineteenth day of
a month shall be considered together on the twentieth day of that month
for advance reservation and shall be processed in the manner given
hereunder, namely:(a)
The applications shall be analysed to check for congestion on any
of the transmission corridors to be used for short-term access.
248
(b)
In case the nodal Regional Load Despatch Centre does not
anticipate congestion on any of the transmission corridors
involved, the applicants shall be granted short-term access for the
quantum and duration sought, latest by the twenty-fifth day of
the month.
(c)
If in the opinion of the nodal Regional Load Despatch Centre,
grant of short-term access to all the applicants is likely to lead to
congestion in one or more of the transmission corridors to be used
for short-term access for any duration, it shall inform the
applicants of its opinion accordingly and the reasons therefor on
or before the twenty-third day of the month.
(d)
On receipt of intimation in accordance with sub-clause (c) above,
an applicant may reduce its requirement of transmission capacity
during the period of congestion or opt for access only for the
duration when no congestion is anticipated and in such a
situation, he shall inform the nodal Regional Load Despatch
Centre accordingly by the twenty-fifth day of the month.
(e)
If the nodal Regional Load Despatch Centre still anticipates
congestion in one or more of the transmission corridors to be
used for short-term access, it shall invite electronic-bids for
reservation of transmission capacity of the congested
transmission corridor in accordance with Regulation 14 of these
regulations on the twenty-sixth day of the month. Nonparticipation of an applicant in the bidding process shall be
construed that he is no longer interested in open access and his
application shall not be processed.
(vii)
In the event of a reserved transmission corridor subsequently
becoming fully or partly vacant for certain duration in a month,
the Regional Load Despatch Centre shall display this
information in public domain on its website.
(viii)
Except as provided in clause (iii), once open access has been
granted, the long-term customer or the short-term customer shall
not be replaced by any other person on account of a subsequent
request received from such other person.
(ix)
The Regional Load Despatch Centres shall lay down a detailed
procedure for reservation of transmission capacity to the shortterm customers after obtaining prior approval of the
Commission, which shall include the detailed procedure for
inviting bids, advance reservation, reservation on first-come249
first-served basis, usage of alternate route through other regions
if direct inter-regional links between two regions are congested
or constrained and any other residual matter. Any further
revision of the procedure shall be carried out only after
obtaining prior approval of the Commission”
5.
Amendment of Regulation 7. Regulation 7 of the principal regulations shall be
substituted as hereunder, namely:“Declaration of Long-term Open Access
7.
Every transmission licensee shall declare the existing long-term customers
using its transmission system (including self-use and use by unbundled agencies which
were previously integrated) either on its website or on the website of the Regional Load
Despatch Centre or the State Load Despatch Centre concerned latest by the thirtieth day
of June 2005.”
6.
Amendment of Regulation 13 of the principal regulations.
(vi)
Clause (ii) of Regulation 13 of the principal regulations shall be substituted as
hereunder, namely:"(ii) The application shall contain the details, such as capacity needed, point
or points of injection, point or points of drawal, duration for availing of open
access, peak load, average load and such other additional information that may
be laid down by the Regional Load Despatch Centre;"
(ii)
Clause (iii) of Regulation 13 of the principal regulations shall be substituted as
hereunder, namely:
“(iii) The application shall be accompanied by a non-refundable application
fee of Rupees five thousand only;
Provided that in case of application for access on the date of the
application or on the following day, the application fee may be deposited
within next three working days of making of application”.
7.
Insertion of new Regulation 13 A. After Regulation 13 of the principal regulations,
the following regulation shall be inserted, namely:“Bidding Process for Short-term Access
250
13A. (i)
The floor price for bidding shall be the ST_RATE determined in
accordance with Regulation 16 of these regulations.
(ii)
The bidders shall quote price in terms of the floor price.
(iii)
No bidder shall be allowed to quote price which is more than five times
the floor price in case of intra-regional transmission system and more
than a two and a half times the floor price in case of inter-regional
transmission system.
(iv)
Reservation of transmission capacity shall be made in decreasing order
of the price quoted.
(v)
In case of equal price quoted by two or more bidders, the reservation of
transmission capacity shall be made pro rata to the transmission
capacity sought to be reserved.
(vi)
The short-term customer getting reservation for capacity less than the
capacity sought by him shall pay the charges quoted by him and the
short-term customers getting transmission capacity reservation equal to
the capacity sought to be reserved, shall pay the charges quoted by the
last customer getting reservation of transmission capacity.”
8.
Amendment of Regulation 14 of the principal regulations. Regulation 14 of the
principal regulations shall be substituted as hereunder, namely:“Non-utilisation of reserved transmission capacity by Short-term Customer:
14.
(i)
In case a short-term customer is unable to utilise, full or substantial part
of the reserved transmission capacity, he shall inform the nodal Regional Load
Despatch Centre along with reasons for his inability to utilise the reserved
transmission capacity and may surrender the reserved transmission capacity.
(ii)
Notwithstanding any thing contained in these regulations, the Regional
Load Despatch Centre may on its own reduce or cancel the reserved
transmission capacity of a short-term customer when such a short-term
customer frequently underutilises the reserved transmission capacity:
Provided that the reserved transmission capacity shall not be
reduced or cancelled under this clause without a prior notice to the
short-term customer whose reserved transmission capacity is sought to
be reduced or cancelled.
(iii)
The short-term customer, who has surrendered the reserved
transmission capacity under clause (i) or whose reserved transmission
capacity has been reduced or cancelled under clause (ii), shall bear the
251
transmission charges and the operating charge based on the original
reserved transmission capacity for seven days or the period of
reservation surrendered or reduced or cancelled, as the case may be,
whichever period is shorter.
Note
For the purpose of this clause, the expression “operating charge” shall
have the same meaning as assigned to it under Regulation 17.
(iv)
The transmission capacity becoming available as a result of surrender
by the short-term customer under clause (i) or as a result of reduction
or cancellation of the reserved transmission capacity by the Regional
Load Despatch Centre under clause (ii), may be reserved for any other
short-term customer in accordance with these regulations.”
9.
Amendment of Regulation 15 of the principal regulations. Regulation 15 of the
principal regulations shall be substituted as hereunder, namely:Treatment of Existing Transactions.
15.
Any person granted open access before commencement of the Central
Electricity Regulatory Commission (Open Access in Inter-state Transmission)
Regulations, (First Amendment) Regulations, 2005 shall not be disturbed till expiry of
the period for which open access has been granted."
10.
Amendment of Regulation 16 of the principal regulations. Regulation 16 of the
principal regulations shall be substituted as under, namely:“Transmission Charges
16.
The transmission charges for use of the transmission system of the transmission
licensee for inter-state transmission shall be regulated as under, namely:(viii) The annual transmission charges payable by a long-term customer for use of
the transmission system shall be determined in accordance with the terms and
conditions of tariff notified by the Appropriate Commission from time to time
and after deducting the adjustable revenue received from the short-term
customers, these charges shall be shared by the long-term customers.
(ii)
The transmission charges payable by a short-term customer shall be calculated
in accordance with the following methodology, namely:(a) Intra-regional system
ST_RATE = 0.25 x [TSC/ Av_CAP]/ 365
(b) Inter-regional system
ST_RATE = 0.50 [ TSC/ CIR]/365
252
Where:
ST_RATE is the rate for short-term customer in Rs per MW per day.
Note
ST_RATE shall be calculated and applied for each regional transmission
system, inter-regional transmission link, and transmission system of the State
Transmission Utility or any other transmission licensee forming part of the
inter-state transmission system.
"TSC" means the annual transmission charges or annual revenue requirement
on account of the transmission system for the previous financial year as
determined by the Appropriate Commission.
"Av_CAP" means the average capacity in MW served by the intra-regional
transmission system of the transmission licensee in the previous financial year
and shall be the sum of the generating capacities connected to the transmission
system and contracted capacities of other long-term transactions handled by
the system of the transmission licensee.
“CIR” means the transmission capacity of the inter-regional system
(iii) The transmission charges payable by a short-term customer in case of
uncongested transmission corridor shall be levied as under, namely :(a) Up to 6 hours in a day in one block : 1/4th of ST_RATE
(b) More than 6 hours and up to 12 hours in a day in one block : 1/2 of
ST_RATE
(c) More than 12 hours and upto 24 hours in a day in one block : equal to ST _
RATE
(iv)
Non-determination of annual transmission charges for the transmission system
shall not be a ground for delay in providing short-term access and where
annual transmission charges for any transmission licensee are not determined
under the Act, ST _ RATE applicable for the system owned by the Central
Transmission Utility of the region in which the system of transmission licensee
is situate, shall be applied for determination of the charges for the short-term
customer.
(v)
Every transmission licensee shall declare ST _ RATE, calculated in
accordance with clause (ii) above, which shall remain fixed for a period of one
year.
(vi)
If the transmission system belongs to the Central Transmission Utility or State
Transmission Utility, 25% of the charges collected from the short-term
customer for use of its intra-regional transmission system and 12.5% of the
charges collected from the short-term customers for use of its inter-regional
system shall be retained by the Central Transmission Utility or State
Transmission Utility and the remaining part of these charges shall be adjusted
253
towards reduction in the transmission charges payable by the long-term
customers.
(vii)
Open access charges specified in this regulation shall not be applicable for the
inter-state transmission system in North-Eastern Region. The charges for use
of the inter-state transmission in this region shall be regulated under the
separate orders of the Commission issued from time to time.”
11
Amendment of Regulation 17 of the principal regulations. Regulation 17 of the
principal regulations shall be substituted as hereunder, namely:“Operating Charge
17.
(i) A composite operating charge @ Rs.3,000/- per day or part of the day
and @ Rs 1,000/- per day or part of the day shall be payable by a shortterm customer for each transaction to the each of the Regional Load
Despatch Centre involved and State Load Despatch Centre respectively.
Note 1
The operating charge includes fee for scheduling and system
operation, fee for affecting revisions in schedule on bonafide grounds and
collection and disbursement charges.
Note 2
The operating charge collected by the Regional Load Despatch
Centre in accordance with Clause (i) shall be in addition to the fees and
charges specified by the Commission under sub-section (4) of Section 28 of
the Act.
Explanation
Operating charge shall be payable by a generating company when
it is granted short-term access under these regulations.”
12.
Amendment of Regulation 19 of the principal regulations. Regulation 19 of the
principal regulations shall be substituted as hereunder, namely:19.
“The payment and receipt of the reactive energy charges by the direct
customers on account of open access shall be calculated in accordance with the
scheme applicable to transactions involving inter-state transmission approved by the
Commission from time to time."
13.
Amendment of Regulation 22 of the principal regulations. Regulation 22 of the
principal regulations shall be substituted as hereunder, namely:“Time Schedule for Processing Application
22
(i) In addition to the time schedule prescribed under regulation 6 for
processing of applications for advance reservation, as far as practicable, the
254
following time schedule shall be adhered to by the respective nodal agency for
processing of the application for grant of access, namely:S.No.
1.
2.
(ix)
Type of service/activity
Short-term Service (for the period to be treated on firstcome-first-served basis)
Up to one week
More than a week
Long-term Service
Intimation regarding feasibility of access without system
strengthening
Intimation of results of studies for system strengthening
with cost estimates and completion schedule
Maximum Processing
time
2 days
3 days
30 days
90 days
Day ahead transaction:
(a) The advance payment of transmission charges, operating charge and application
fee shall not be insisted upon. These payments can be made within 3 working
days of making of application.
(b) A composite request for open access and scheduling shall be sent to the nodal
Regional Load Despatch Centre through the State Load Despatch Centre
concerned latest by 3.00 PM. The nodal Regional Load Despatch Centre shall
take steps to incorporate the request for open access in the schedules to be issued
by the Regional Load Despatch Centres concerned, if the request can be
accommodated without causing congestion.
(c) A composite request for open access and scheduling to utilise surpluses known
after issuance of the first despatch schedule by Regional Load Despatch Centres at
5.00 PM, must be submitted to the nodal Regional Load Despatch Centre latest by
10.00 PM or preferably earlier. The nodal Regional Load Despatch Centre shall
endeavour to incorporate the same in the revised despatch schedule to be issued by
the Regional Load Despatch Centres concerned, if the request can be
accommodated without causing congestion.
(iii)
Same Day transactions
(a)
The advance payment of transmission charges, operating charge and
application fee shall not be insisted upon. These payments can be made
within 3 working days of making of application.
(b)
In the event of emergency, the beneficiaries/buying utility may locate a
source of power to meet short-term emergency requirement on the
same day and forward request for open access to the nodal Regional
Load Despatch Centre through the concerned State Load Despatch
Centre. The Regional Load Despatch Centres shall endeavour to
255
accommodate such emergency requests as soon as and to the extent
practically feasible.
14.
Insertion of new Regulation 23A. After Regulation 23 of the principal regulations,
the following regulation shall be inserted, namely:“Transmission Charges for short-term customers in case of curtailment
23A. In case of curtailment of more than 50% of the reserved transmission capacity
by the Regional Load Despatch Centre on any particular day on account of
transmission constraints, the transmission charges for that day shall be payable by the
short-term customers on pro rata basis in accordance with the transmission capacity
actually provided.”
15.
Amendment of Regulation 24 of the principal regulations. Regulation 24 of the
principal regulations shall be substituted as hereunder, namely:“Commercial Conditions
24.
(i)
Short-term customers
(a)
(b)
(c)
(ii)
The transmission charges and operating charge shall be paid to
the nodal Regional Load Despatch Centre on monthly basis.
Advance payment for one month or period of access,
whichever period is shorter, shall be made within three working
days of grant of access.
Subsequent payments shall be made at least one day before
beginning of next month.
(d)
Payment shall be made either through cheque/demand draft
payable at the location of the nodal Regional Load Despatch
Centre or through electronic transfer.
(e)
If duration of access granted exceeds one month, the short- term
customer shall provide an irrevocable back up letter of credit
within seven days of commencement of open access.
(f)
In case of non-receipt of payment within the period specified in
clause (b) or (c) above, the nodal Regional Load Despatch
Centre shall, in its discretion, have the right to invoke the letter
of credit or cancel the reserved transmission capacity.
Long-term customers
256
The commercial conditions for the long-term customer shall be same as
applicable to the existing beneficiaries.”
16.
Amendment of Regulation 25 of the principal regulations. . Regulation 25 of the
principal regulations shall be substituted as hereunder, namely:“Special Energy Meters
25. The Special Energy Meters shall be installed by the Central Transmission Utility
for and at the cost of the direct customers and by the concerned State Transmission
Utility for and at the cost of the embedded customers.”
17.
Amendment of Regulation 31 of the principal regulations. Regulation 31 of the
principal regulations shall be substituted as hereunder, namely:“Collection and Disbursement of Charges
31.
(i)
The transmission charges in respect of the long-term customers shall be
payable directly to the respective transmission licensee.
(iii)
The operating charge and the transmission charges payable by the short-term
customers shall be collected and disbursed by the nodal Regional Load
Despatch Centre.
(iv)
In case the transmission system owned by the State Transmission Utility is
internalised, the transmission charges under Regulation 16 of these regulations
and the operating charge payable under clause (i) of Regulation 17 to be
collected by the nodal Regional Load Despatch Centre, shall not include the
charges for the transmission system owned by the State Transmission Utility
and operating charge payable to the State Load Despatch Centre.
The collection and disbursement of the unscheduled inter-change charges and
the reactive energy charges shall be governed in accordance with the procedure
and methodology specified by the Commission from time to time.”
(v)
(A.K. SACHAN)
SECRETARY
Note
The principal regulations were published in Part III, Section 4 of the Gazette of India
(Extraordinary) dated 6.2.2004.
The consolidated regulations, after incorporating the amendments to the principal
regulations are annexed.
257
Electricity Trading License / CERC (30.01.2004)
CENTRAL ELECTRICITY REGULATORY COMMISSION
New Delhi
NOTIFICATION
No.L-7/25(6)/2004
th
Dated the 30 January,2004
In exercise of powers conferred under Section 178 of the Electricity Act, 2003 and of
all other powers enabling in this behalf, and after previous publication, the Central Electricity
Regulatory Commission hereby makes the following regulations, namely: CHAPTER- I: PRELIMINARY
1. Short Title and Commencement
(a)
These regulations shall be called the Central Electricity Regulatory
Commission (Procedure, Terms & Conditions for grant of Trading Licence and other
related matters) Regulations, 2004.
(b)
These regulations shall come into force from the date of their publication in the
Official Gazette.
2. Definitions and Interpretation
(1) In these regulations unless the context or subject-matter otherwise requires,(a) “Act” means the Electricity Act, 2003, (36 of 2003);
(b) “Applicant” means a person who has made an application to the Commission for
grant of licence for inter-state trading:
Provided that such person is a resident of India, or a partnership firm registered under
the Indian Partnership Act, 1932 (9 of 1932), or a company incorporated under the
Companies Act, 1956 (1 of 1956) or an association or body of individuals whether
incorporated or not or an artificial juridical person subject to Indian laws.
258
(c) “Agreement” means the agreement entered into between the electricity trader and the
seller of electricity on the one hand and the electricity trader and the buyer of electricity
on the other;
(d) “Commission” means the Central Electricity Regulatory Commission referred to in
Section 76 of the Act;
(e) “Conduct of Business Regulations” means the Central Electricity Regulatory
Commission (Conduct of Business) Regulations, 1999, as amended from time to time and
includes any statutory re-enactment thereof;
(f) “ Grid Code" means the Grid Code specified by the Commission under clause (h) of
sub-section (1) of Section 79 of the Act and includes the Indian Electricity Grid Code
applicable on the date of commencement of these regulations;
(g) "Inter-state trading" means transfer of electricity from the territory of one State to the
territory of another State by an electricity trader;
(h) “Licence” means a licence granted under Section 14 of the Act to undertake inter-state
trading in electricity as an electricity trader;
(i) “Licensee” means a person who has been granted a licence under Section 14 of the Act
to undertake inter-state trading in electricity as an electricity trader;
(j) "Other Business" means any business of the licensee other than the licensed business
of inter-state trading;
st
(k) "Year" means a period of twelve months from 1 April of a calender year to 31
March of the following calender year;
st
(2) Save as aforesaid and unless repugnant to the context or the subject-matter
otherwise requires, words and expressions used in these regulations and not
defined, but defined in the Act, and the Grid Code shall have the meanings
assigned to them respectively in the Act or the Grid Code.
(3) The provisions of the General Clauses Act, 1897 (10 of 1897) as amended from
time to time shall apply for the interpretation of these regulations as they apply for
the interpretation of an Act of Parliament.
(4) These regulations shall be applicable to trading carried out bilaterally between the
generating company, including captive generating plant, distribution licensee and
the electricity trader on the one hand and the electricity trader and the distribution
licensee on the other:
Provided that the scope and applicability of these regulations may be reviewed
from time to time to keep pace with the developments of formulation of regulations
for open access in distribution by the State Electricity Regulatory Commissions or
introduction of power exchange market by the Commission.
CHAPTER-II : PROCEDURE FOR GRANT OF LICENCE FOR INTER-STATE
TRADING
1
2
All proceedings under these regulations shall be governed by the Conduct of Business
Regulations.
(1) The application for grant of licence for inter-state trading shall be made to the
259
Commission in the manner specified under these regulations, in Form-I appended to
these regulations and shall be accompanied by such fee as may be prescribed by the
Central Government:
Provided that till such time the fee is prescribed by the Central Government, the
application for grant of licence for inter-state trading shall be accompanied by a fee of
Rs.1.00 lakh (Rupees one lakh only) payable through Bank Draft/Pay Order drawn in
favour of Assistant Secretary, Central Electricity Regulatory Commission, New Delhi,
and the fee so paid shall be subject to adjustment as and when the fee is prescribed by
the Central Government.
(2) The application for grant of licence for inter-state trading, along with annexures and
enclosures shall also be submitted to the Commission on compact disc (CD).
(3) The applicant shall post complete application along with annexures and enclosures on
his own website or any other authorised website, so as to facilitate access to the
application by any person through Internet.
(4) The applicant shall within 7 days after making such application, publish a notice of his
application, in at least two national English daily newspapers, including one economic
newspaper and two local newspapers falling within the area or areas of trading, one of
which shall be in vernacular, with the following particulars, namely:(a) Name of the applicant in bold at the top clearly bringing out whether the applicant is
an individual, a partnership firm registered under the Indian Partnership Act 1932 (9 of
1932), a private limited company or a public limited company, incorporated under the
Companies Act, 1956, (1 of 1956) giving full particulars of its office address and also the
registered office address in case of a Company incorporated under the Companies Act,
1956;
(b) A statement that the applicant has made an application for grant of licence in interstate trading under sub-section (1) of Section 15 of the Act, to the Central Electricity
Regulatory Commission;
(c) Share holding pattern, financial and technical strength and management profile of the
applicant;
(d) Volume of power intended to be traded during the first year after grant of licence and
the future plans for trading during the next 5 years;
(e) Details of past experience of the applicant or the persons on its management in same
or similar activity;
(f) Geographical areas within which the applicant will undertake trading in electricity as
stated in the application made to the Commission;
(g) A statement to the effect that the application and other documents filed before the
Commission from time to time, are available for inspection with the applicant, by any
person;
(h) Name and address and other relevant details of the person under the control of the
applicant with whom the application and other documents can be inspected by any person;
(i) A statement to the effect that complete application is available on the website of the
applicant or any other authorised website alongwith the details of the website where the
application is made available;
(j) A statement that objections, if any, be filed before the Secretary, Central Electricity
260
th
Regulatory Commission, 7 Floor, Core-3, Scope Complex, Lodhi Road, New Delhi 110 003 or at the address where office of the Commission is situate, with a copy of the
objections to the applicant, within 30 days of publication of the notice;
(5) The applicant shall within 7 days from the date of publication of the notice as
aforesaid submit to the Commission on affidavit the details of the notice published and
shall also file relevant copies of the newspapers in which the notice is published.
(6) The applicant may file his comments on the objections or suggestions received in
response to the notice within 45 days of its publication in the newspapers.
(7) The Commission may consider the application for grant of licence for inter-state
trading through a hearing or without any hearing, as considered appropriate:
Provided that the Commission may issue a licence for inter-state trading on
being satisfied that the applicant qualifies for issue of such licence under the
provisions of the Act and the Rules and the Regulations:
Provided further that before granting the licence, the Commission shall publish
a notice of its proposal to grant the licence in two daily newspapers, as the
Commission may consider necessary, stating the name and address of the person to
whom it proposes to issue the licence, with such other details as the Commission
considers appropriate.
(8) As far as practicable the licence shall be granted in accordance with format
prescribed in Form 2 appended to these regulations.
CHAPTER III – REQUIREMENTS OF BEING AN ELECTRICITY TRADER
5. Technical Requirements
(1) The applicant shall have at least one full-time professional having, experience in
each of the following disciplines, namely:
(i)
Power System Operations and commercial aspects of power transfer, and
(ii)
Finance, commerce and accounts .
(2) The technical requirement of staff shall be complied with before undertaking trading
activities, notwithstanding the fact that the Commission has granted the licence for inter-state
trading.
(3) The applicant shall furnish to the Commission the details of the professional and the
supporting staff engaged by him on full-time basis before undertaking inter-state trading.
6. Capital adequacy Requirement and Creditworthiness: Considering the volume of inter261
state trading proposed to be undertaken, the net worth of the electricity trader at the time of
application shall not be less than the amounts specified hereunder:
Sl.
No.
Category of the
Trading Licence
Volume of Electricity proposed to
be traded (in Kilo - Watt Hours)
1
2
3
4
5
6
A
B
C
D
E
F
Upto 100 million
100 to 200 million
200 to 500 million
500 to 700 million
700 to 1000 million
Above 1000 million
Net worth
(Rs. in crore)
1.50
3.0
7.5
10.0
15.00
20.00
CHAPTER - IV : TERMS AND CONDITIONS OF THE LICENCE
7. Obligations of the Licensee
The licensee shall be subject to the following obligations; namely:(a) The licensee shall comply with the requirements of laws in force and, in particular, the
Act, the Rules and the Regulations, Grid Code, orders and directions issued by the
Commission and the State Electricity Regulatory Commission (s) from time to time;
(b) The licensee shall increase his net worth if the volume of trade moves from a lower
category to a higher category and the change of category shall be decided based on the
st
volume of electricity traded as on 31 March of each year, and of which the licensee shall
keep the Commission informed of his moving from one category to the other and subsequent
changes in the net worth;
(c) The licensee shall be subject to the trading margins for the inter-state trading as fixed by
the Commission, from time to time;
(d) The licensee shall be governed by the technical requirements, capital adequacy
requirements and creditworthiness specified by the Commission in these regulations, for
being an electricity trader and shall upgrade these technical and capital adequacy
requirements, including staff, when the volume of trading increases;
(e) The licensee shall establish adequate communication facilities like telephone, fax,
computer, internet facilities, before undertaking trading;
(f) The licensee shall coordinate with Regional Electricity Boards or Regional Power
Committees, as the case may be, the Regional Load Despatch Centres/State Load Despatch
Centres, and Central Transmission Utility/State Transmission Utilities with regard to all
trading- related activities;
262
(g) The licensee shall render all assistance to any person authorised by the Commission for
carrying out his duties relating to the licence;
(h) Trading shall be carried out bilaterally between the parties by entering into appropriate
contracts. Necessary safeguards with regard to supply of electricity through trading, or
payment for the electricity traded shall be included in the agreements between the parties. All
trading arrangements shall be done through the letters of credit or with any other superior
instrument;
(i) The licensee shall pay the licence fee specified under these regulations in accordance with
the time-schedule specified hereunder;
(j) The licensee shall not omit or neglect to undertake trading activity for four consecutive
quarters;
(k) The licensee shall not enter into any agreement leading to abuse of his dominant position
or enter into a combination which is likely to cause or causes an adverse effect on competition
in electricity industry;
(l) The licensee shall maintain up-to-date record of his customers and the transactions
undertaken by him with other parties.
8. Prohibited Activities
(1) The licensee shall not, without prior approval of the Commission:
(i) Acquire by purchase or take over or otherwise the utility of any other licensee; or
(ii) Merge his utility with the utility of any other licensee; or
(iii) Assign or transfer his licence to any person, by sale, lease, exchange or otherwise.
(2) The licensee shall not engage in the business of transmission of electricity.
(3) Wherever prior approval of the Commission is required, the licensee shall file an
appropriate application before the Commission, in accordance with the Conduct of Business
Regulations.
9. Payment of Licence Fee
(1) The licensee shall pay to the Commission the annual licence fee of the amount
specified hereunder, payable by means of a demand draft or pay order drawn in favour
of Assistant Secretary, Central Electricity Regulatory Commission, New Delhi:
Sl. No.
Category
1
2
3
4
A
B
C
D
Volume of Electricity
proposed to be traded per
annum (in Kilo - Watt
Hours)
Upto 100 million
100 to 200 million
200 to 500 million
500 to 700 million
Licence fee
(Rs. in lakh)
1.00
2.00
5.00
7.00
263
5
6
E
F
700 to 1000 million
Above 1000 million
10.00
15.00
Provided that for a part of the year, the licence fee shall be payable pro rata on number
of days basis:
Provided further that the licence fee calculated on pro rata basis for a part of the year
shall be rounded off to nearest hundred rupees.
th
(2) The licence fee shall be paid by 15 April of each year, and in case the licensee has
moved from a lower category to a higher category, the balance of licence fee shall be paid
th
before 30 April of each year:
Provided that the first installment of the licence fee shall be paid within a period of one
month from the date of issue of licence:
Provided further that in case the licensee fails to pay the licence fee or a part thereof,
the licensee shall be liable to pay late payment surcharge on the outstanding amount at the
rate of 1% of the licence fee payable per month or a part of the month, for the period the
licence fee or any part thereof remains unpaid.
(3) Notwithstanding the liability of the licensee to pay the late payment surcharge as
aforesaid, the delay in payment of licence fee or a part thereof, shall be construed as
breach of the terms and conditions of the licence and the licence shall be liable to be
revoked.
10. Accounts of the Licensee
(1) The licensee shall (a)
Maintain separate information and statement of accounts for the business of inter-state
trading covered by the licence;
(b)
Maintain the statement of accounts in such form and contain such particulars as may
be specified by the Commission and till such time these are specified by the Commission, the
accounts shall be maintained in accordance with the Companies Act, 1956, (1 of 1956) as
amended from time to time;
(c)
Keep the accounts of the business of inter-state trading separate from other business,
264
whether licensed or otherwise;
(d)
Prepare on a consistent basis from such records accounting statements for each
financial year comprising a profit and loss account, a balance sheet and a statement of source
and application of funds together with notes thereto and showing separately the amounts of
any revenue, cost, asset, liability, reserve, or provision which has been either:
(i)
Charged from or to any other business together with a description of the basis of that
charge ; or
(ii)
Determined by apportionment or allocation between the various business activities
together with a description of the basis of the apportionment or allocation;
(e)
Provide in respect of the accounting statements prepared in accordance with foregoing
clauses, a report by the Auditors in respect of each year, stating whether in their opinion the
statements have been properly prepared and give a true and fair view of the revenue, costs,
assets, and liabilities, reserves reasonably attributable to the business to which the statements
relate, and
(f)
Submit to the Commission copies of the accounting statements and Auditor’s report
not later than nine months after the close of the year to which they relate.
(2) Any person authorised by the Commission shall be entitled to inspect and verify the
accounts of the licensee and the licensee shall render all necessary assistance to such person.
11. Submission of Information
The licensee shall,(a)
Supply such information, as may be called for by the Commission from time to time;
(b)
Furnish the information as may be required from time to time, to monitor the
licensee's performance and compliance of the terms and conditions of the licence and any
other legislative or regulatory requirement in Form III appended to these regulations for
submission of information:
Provided that the information in the prescribed Form shall be furnished to the
Regional Load Despatch Centre and Regional Electricity Board or Regional
Power Committee, as the case may be with a copy to the Commission, on a
th
quarterly basis on 10 day of April, July, October and January for the quarters
January to March, April to June, July to September and October to December
respectively and the format for submission of information shall be filled up
complete in all respects and no column shall be left blank:
Provided further that the report sent to the Regional Load Despatch Centre and
the Regional Electricity Board or the Regional Power Committee, as the case
may be, shall be posted on the website of the electricity trader or any other
authorised website:
265
Provided also that the Regional Load Despatch Centre and Regional Electricity
Board or Regional Power Committee, as the case may be, shall verify the
quantum of energy traded, as indicated in the reports and submit a report to the
Commission.
12. Standards of performance
(1) The Commission may, after consultation with the licensee specify the standards of
performance of a licensee or a class of licensees.
(2) Notwithstanding anything contained in Clause (1) above, the licensee shall furnish the
performance details for each year to the Commission on quarterly basis for the quarter ending
st
th
th
st
31 March, 30 June, 30 September and 31 December in the format prescribed in Form th
IV appended to these regulations, by 15 day of the first month of the following quarter.
13. Prudential Reporting
The licensee shall, as soon as practicable, report to the Commission:
(a)
Any significant change in his circumstances which may affect the licensee’s ability to
meet his obligations under the Act, the Rules and the Regulations, directions and orders
issued by the Commission, the Grid Code, agreement or the licence;
(b)
Any material breach of the provisions of the Act, the Rules and the Regulations,
directives and orders issued by the Commission, the Grid Code, agreement or the licence; and
(c)
Any major change in shareholding pattern, ownership or management of the licensee.
14. Amendment of Licence
(1) The terms and conditions of the licence may be modified by the Commission in public
interest or on an application made by the licensee.
(2) The procedure specified in Regulation 4 hereinabove shall mutatis mutandis be applicable
in case the licensee makes an application for any alteration of or modification to the terms and
conditions of the licence.
15. Revocation of Licence
(1) The Commission may revoke the licence in accordance with Section 19 of the Act , in
any of the following circumstances, namely:266
(i)
Where the licensee in the opinion of the Commission, makes wilful and
prolonged default in doing anything required of him by or under the Act, or the Rules
or the Regulations;
(ii)
Where the licensee breaches any of the terms and conditions of his licence, the
breach of which is expressly declared by such licence to render it liable to revocation;
(iii)
Where the licensee fails, within the period fixed in this behalf by his licence, or
any longer period which the Commission may allow therefor, to show to the
satisfaction of the Commission, that he is in a position fully and efficiently to
discharge the duties and obligations imposed on him by his licence;
(iv)
Where in the opinion of the Commission the financial position of the licensee
is such that he is unable to fully and efficiently discharge the duties and obligations imposed
on him by his licence;
(v)
Where licensee has failed or neglected to undertake trading in electricity for
four consequent quarters;
Provided that the licence shall not be revoked except after an enquiry by
the adjudicating officer appointed by the Commission under Section 143 of the
Act in the manner prescribed by the Central Government:
Provided further that the Commission may, instead of revoking a licence
under clause (1) above, permit the licence to remain in force subject to such
further terms and conditions as it thinks fit to impose, and any further terms and
conditions so imposed shall be binding upon and be observed by the licensee
and shall be of like force and effect as if they were contained in the licence.
(2) When the licensee makes an application for revocation of the licence and the Commission
is satisfied that public interest so requires, the Commission may revoke his licence, on such
terms and conditions as it thinks fit.
(3) The Commission shall serve a notice of revocation upon the licensee and fix a date on
which the revocation shall take effect.
16. Communication
(1) All communications relating to the licence shall be in writing and shall be delivered either
in person to the addressee or his authorized agent, or sent by registered or speed post at the
place of business of the addressee.
(2) All communications shall be regarded to have been given by the sender and received by
the addressee, –
(i) when delivered in person to the addressee or to his authorised agent;
(ii) on expiry of 15 days from the date of sending by registered or speed post at the
267
address of the addressee.
17. Power to relax
The Commission may in appropriate cases and for reasons to be recorded in writing relax any
of the provisions of these regulations.
(A.K. SACHAN)SECRETARY
FORM - I
Application form for grant of Inter-State Trading Licence
Particulars of the Applicant
1
2
3
4
5
6
7
8
9
Name of the applicant :
Address
:
Name, Designation & Address: of the contact person
Contact Tel. Nos.
:
Fax No. :
E-mail ID :
Place of Incorporation/Registration :
Year of Incorporation/Registration :
Following documents are to be enclosed a) Certificate of registration : b) Certificate
for commencement :
of business c) Memorandum of
Association and Articlesof Association :
d) Original power of attorney of the :
signatory to commit the Applicant or
its promotere) Details of Income tax
Registration :
Details of Financial Data of Applicant
268
10.
Net worth (in equivalent Indian Rupees-conversion to be done at the rate of exchange
prevailing at the end of each year) for immediate past 5 (five) financial years.
(Specify financial year as applicable)
(DD/MM/YY) to (DD/MM/YY) In Home Exchange In equivalent Currency rate used
Indian Rs.
(a) Year 1( ) to ( ) ----------- ------------- -------------(b) Year 2( ) to ( ) ----------- ------------- -----------(c) Year 3( ) to ( ) ------------ ------------- -------------(d) Year 4( ) to ( ) ------------ ------------- -------------(e) Year 5( ) to ( ) ------------ ------------- -------------(f) Copies of Annual Reports or certified audited results to be enclosed in support of
above.
11.
Annual turnover (in equivalent Indian Rupees - conversion to be done at the rate of
exchange prevailing at the end of each year) for immediate past 5 (five) financial
years. (Specify financial year as applicable)
(DD/MM/YY) to (DD/MM/YY) In Home Exchange In equivalent Currency rate used
Indian Rs.
(a) Year 1( ) to ( ) ----------- ------------- -------------(b) Year 2( ) to ( ) ----------- ------------- -----------(c) Year 3( ) to ( ) ------------ ------------- -------------(d) Year 4( ) to ( ) ------------ ------------- -------------(e) Year 5( ) to ( ) ------------ ------------- -------------(f) Copies of Annual Reports or certified audited results to be enclosed in support
of above.
12.
List of documents enclosed in support of Sl. Nos. (10) and (11) above:
Name of the document
(a)
(b)
(c)
(d)
13.
_______________
_______________
_______________
_______________
(a) Whether applicant himself shall be financing the proposed trading Yes/No fully
on its own balance sheet
(b)
If, yes, proposed equity from the applicant
(i)
Amount :
(ii) Percentage
:
269
14.
In case the applicant proposes to tie up with some
other Agency for equity, then name & address of
such agency:
(a)Name, designation & Address of reference : person of
the other Agency
(b) Contact Tel. No. :
(c) Fax No. :
(d) E-mail ID :
(e) Proposed equity from the other Agency
(i)
Amount :
(ii)
Percentage of total equity :
(iii)
Currency in which the equity : is proposed
(f) Consent letter of the other agency to associate with the applicant for equity
participation to be enclosed.
(g) Nature of proposed tie-up between the applicant and the other agency.
15. Details of debt proposed for the trading activity:
(a) Details of lenders :
(b) Amount to be sourced from: various lenders
(c)
Letters from the lenders in support : of the above to be enclosed.
2
16. Organisational & Managerial Capability of the applicant:
(The applicant is required to enclose proof of their Organisational &
Managerial Capability, in terms of these regulations, in form of proposed
organisational structure & curricula vitae of various executives, proposed
office and communication facilities, etc.)
Approach & Methodology:
(The applicant is required to describe approach & methodology for
establishment of the trading arrangements as proposed by him.)
(Signature of the Applicant) Dated
:
FORM II
CENTRAL ELECTRICITY REGULATORY COMMISSION
LICENSE TO TRADE IN ELECTRICITY AS AN ELECTRICITY TRADER
1
The Central Electricity Regulatory Commission (hereinafter referred to as “the
Commission”), in exercise of the powers conferred under Section 14 of the Electricity
270
2
3
4
Act, 2003 (hereinafter referred to as “the Act”), hereby grants this licence as a
Category _________ trader to ____________, (hereinafter referred to as “the
licensee”) to trade in electricity as an electricity trader in the area _________ subject
to the terms and conditions contained in the Act, (in particular, Sections 17 to 22
thereof, both inclusive), the Rules made by the Central Government (hereinafter
referred to as “the Rules”) and the Regulations specified by the Commission (herein
after referred to as “the Regulations”), including statutory amendments, alterations,
modifications, reenactments thereof, which shall be read as part and parcel of this
licence.
This licence is not transferable, except in accordance with the provisions of the Act,
the Rules and the Regulations.
3.
(1) The licensee shall not without prior approval of the Commission—
(a) undertake any transaction to acquire by purchase or take over or otherwise,
the utility of any other licensee; or
(b) merge its utility with utility of any other licensee;
(2) The licensee shall not at any time assign its licence, or transfer its utility, or
any part thereof, by sale, lease, exchange or otherwise without the prior
approval of the Commission
(3) Any agreement relating to any transaction referred to in sub-clause (1) and
sub-clause (2) unless made with the approval of the Commission, shall be void.
The grant of this licence to the licensee shall not in any way hinder or restrict the right
of the Commission to grant a licence to any other person within the same area for
trading in electricity as an electricity trader. The licensee shall not claim any
exclusivity.
This licence shall commence on the date of its issue and unless revoked earlier, shall
continue to be in force for a period of 25 (twenty five) years.
6.
The licensee may with prior intimation to the Commission, engage in
any business for optimum utilisation of its assets.
Provided that the licensee shall not engage in the business of transmission of
electricity.
7.
Unless otherwise specified by the Commission, the licensee shall pay
annual license fee of Rs.___lakh, and license fee for a part of the year shall be
paid on pro-rata basis rounded off to the nearest hundred rupees.
For the purpose of this clause, the "year" means a period of twelve months
st
5
st
from 1 April of a calendar year to 31 March of the following calendar year.
The provisions contained in Sections 19 to 22, both inclusive, of the Act shall apply to
the licensee with regard to revocation of licence and sale of his utility.
Sd/(A.K.
SACHAN)SECRETARY
271
272
FORM - III
Proforma for submission of information for the Quarter (say January to March, 2004)
Name of the Trader:
License details (No & date):
S.No. Volume
of
Trading
in
million
Kwhs
Purchased
from*
Sold
to*
Point of
purchase
Purchase
price
Point
of sale
Sale
price
Transmissio
n/wheeling
charges
borne by
Seller/Trade
r/Buyer**
Transmissio
n losses
borne by
Seller/
Trader/
Buyer**
UI
Trading
charges margin
borne
charged
by
Seller/
Buyer**
Remarks
273
Note: All the transactions shall be reported transaction-wise on real time basis and should not be aggregated.
* Besides the name of the seller/buyer, indicate the category of the seller/buyer namely generator, captive power plant, distribution
licensee, Government, consumer (when applicable) etc. **
Strike out whichever is not applicable.
FORM - IV
Proforma for submission of Standards of Performance of Electricity Trader
(to be submitted to the Commission and RLDC)
Name of the Trader:
License details (No. & date):
S.No. Volume of
trading during
the quarter
himself
(Yes / No)
Cumulative
trading upto the
present quarter
Whether
there is any
change in the
category of
trader
Whether
networth is
increased,
due to change
of category
(Yes / No)
Whether
additional
license fee,
due to
change in
category
deposited
with the
Commission
Whether any
violation to
the license
conditions
pointed out
by any
agency or
observed by
the licensee
Payment
track record
for energy
purchased
for trading
Remarks
(Yes / No)
Note: i) A separate copy of duly filled Form IV shall also be submitted to the Commission directly. ii) RLDC shall verify the volume of
trading & pass on the Form IV to the Commission.
274
275
LIST OF CLEARANCES REQUIRED FOR POWER PROJECTS
Sl.
No
ITEM
AGENCY
REMARKS
STATUTORY CLEARANCES
1
CONCURRENCE OF CEA for
hydro
electric
generation
schemes.
CEA
Under section 8 of Electricity Act,
2003.
2
WATER AVAILABILITY:
State Govt.
Interaction between State Govt.’s
Deptts & CWC required. Relevant
Irrigation Act of the State &
Central/Water Commission.
CWC
3
POLLUTION CLEARANCE
WATER AND AIR
SPCB
Water Prevention & Control Pollution
Act 1974 Air/Prevention & Control of
Pollution Act 1981
4.
FOREST CLEARANCE
State Govt
Coordination with State Forest Deptt.
Min. of Environment & Forest (
regarding Forest Conservation Act
1980)
Min.
of E&F
5.
ENVIRONMENT & FOREST
CLEARANCE
6
CIVIL AVIATION
CLEARANCE FOR
CHIMNEY HEIGHT
7
REGISTRATION OF
COMPANY
8
REHABILITATION
&
RESETTLEMENT
OF
DISPLACED FAMILIES BY
LAND ACQUISITION
9
HYDRO PROJECTS(MINIMICRO)
10 EQUIPMENT
PROCUREMENT
NON-STATUTORY CLEARANCES
14 LAND AVAILABILITY
15 FUEL LINKAGE
16
17
FINANCING
TRANSPORTATION OF
FUEL
- do -
As per item 6, 7 & Govt. Policy in
force
National Airport
Authority
Registrar of Companies
MoEF/
State Govt.
Under Indian Companies Act, 1956
Ministry of Water
Resources
DGTD/ CCI&E*
Under Relevant Acts.
Import & Export Acts.
State Govt.
Deptt of Coal,
Deptt. of Petroleum
& Natural Gas
Financial Institutions
Deptt of Coal,
Min. of Petroleum &
Natural
Gas,
Ministry
of
Railways, Shipping
& Surface Transport
276
* Not required any more
Environmental delegation orders
MINISTRY OF ENVIRONMENT AND FORESTS
ENVIRONMENT IMPACT ASSESSMENT NOTIFICATION S.O.60(E), dated
27/01/1994
(incorporating amendments vide S.O. 356(E) dated 4/5/1994, S.O. 318(E) dated
10/4/1997, S.O. 319 dated 10/4/1997, S.O. 73(E) dated 27/1/2000, S.O. 1119(E) dated
13/12/2000, S.O. 737(E) dated 1/8/2001, S.O. 1148(E) dated 21/11/2001, S.O. 632(E) dated
13/06/2002 )
1) S.O. 60 (E)- Whereas a notification under clause (a) of sub-rule (3) of rule 5 of the
Environment (Protection) Rules, 1986 inviting objections from the public within sixty
days from the date of publication of the said notification, against the intention of the
Central Government to impose restrictions and prohibitions on the expansion and
modernization of any activity or new projects being undertaken in any part of India unless
environmental clearance has been accorded by the Central Government or the State
Government in accordance with the procedure specified in that notification was published
as SO No. 80(E) dated 28th January, 1993;
And whereas all objections received have been duly considered;
Now, therefore, in exercise of the powers conferred by sub-section (1) and clause (v)
of sub-section (2) of section 3 of the Environment (Protection) Act, 1986 (29 of 1986)
read with clause (d) of sub-rule (3) of rule 5 of the Environment (Protection) Rules,
1986, the Central Government hereby directs that on and from the date of publication
of this notification in the Official Gazette, expansion or modernization of any activity
(if pollution load is to exceed the existing one, or new project listed in Schedule I to
this notification, shall not be undertaken in any part of India unless it has been
accorded environmental clearance by the Central Government in accordance with the
procedure hereinafter specified in this notification;
2) Requirements and procedure for seeking environmental clearance of projects:
I.(a) Any person who desires to undertake any new project in any part of India or the
expansion or modernization of any existing industry or project listed in the ScheduleI shall submit an application to the Secretary, Ministry of Environment and Forests,
New Delhi.
The application shall be made in the proforma specified in Schedule-II of this notification
and shall be accompanied by a project report which shall, inter alia, include an
Environmental Impact Assessment Report, Environment Management Plan and details of
public hearing as specified in Schedule-IV prepared in accordance with the guidelines
issued by the Central Government in the Ministry of Environment and Forests from time
to time. However, Public Hearing is not required in respect of (i) small scale industrial
277
undertakings located in (a) notified/designated industrial areas/industrial estates or (b)
areas earmarked for industries under the jurisdiction of industrial development authorities;
(ii) widening and strengthening of highways; (iii) mining projects (major minerals) with
lease area up to twenty five hectares, (iv) units located in Export Processing Zones,
Special Economic Zones and (v) modernisation of existing irrigation projects.
Provided that for pipeline projects, Environmental Impact Assessment report will not be
required:
Provided further, that for pipeline and highway projects, public hearing shall be conducted
in each district through which the pipeline or highway passes through.
(b) Cases rejected due to submission of insufficient or inadequate data and Plan may be
reviewed as and when submitted with complete data and Plan. Submission of
incomplete data or plans for the second time would itself be a sufficient reason for the
Impact assessment Agency to reject the case summarily.
II. In case of the following site specific projects:
a. mining;
b. pit-head thermal power stations;
c. hydro-power, major irrigation projects and/or their combination including flood
control;
d. ports and harbours (excluding minor ports);
e. prospecting and exploration of major minerals in areas above 500 hectares;
The project authorities will intimate the location of the project site to the
Central Government in the Ministry of Environment and Forests while
initiating any investigation and surveys. The Central Government in the
Ministry of Environment and Forests will convey a decision regarding
suitability or otherwise of the proposed site within a maximum period of thirty
days. The said site clearance shall be granted for a sanctioned capacity and
shall be valid for a period of five years for commencing the construction,
operation or mining.
III. (a) The reports submitted with the application shall be evaluated and assessed by the
Impact Assessment Agency, and if deemed necessary it may consult a committee
of Experts, having a composition as specified in Schedule-III of this Notification.
The Impact Assessment Agency (IAA) would be the Union Ministry of
Environment and Forests. The Committee of Experts mentioned above shall be
constituted by the Impact Assessment Agency or such other body under the Central
Government authorised by the Impact Assessment Agency in this regard.
(b)
The said Committee of Experts shall have full right of entry and
inspection of the site or, as the case may be, factory premises at any time prior to,
during or after the commencement of the operations relating to the project.
278
(c) The Impact Assessment Agency shall prepare a set of recommendations based on
technical assessment of documents and data, furnished by the project authorities
supplemented by data collected during visits to sites or factories, if undertaken and
details of the public hearing.
The assessment shall be completed within a period of ninety days from receipt of
the requisite documents and data from the project authorities and completion of
public hearing and decision conveyed within thirty days thereafter.
The clearance granted shall be valid for a period of five years for commencement
of the construction or operation of the project.
IV. In order to enable the Impact Assessment Agency to monitor effectively the
implementation of the recommendations and conditions subject to which the
environmental clearance has been given, the project authorities concerned shall submit
a half yearly report to the Impact Assessment Agency. Subject to the public interest,
the Impact Assessment Agency shall make compliance reports publicly available.
V. If no comments from the Impact Assessment Agency are received within the time limit,
the project would be deemed to have been approved as proposed by project authorities.
3) Nothing contained in this Notification shall apply to:
a. any item falling under entry Nos. 3, 18 and 20 of the Schedule-I to be located or
proposed to be located in the areas covered by the Notifications S.O. No.102
(E) dated 1st February, 1989, S.O. 114 (E) dated 20th February, 1991; S.O. No.
416 (E) dated 20th June, 1991 and S.O. No.319 (E) dated 7th May, 1992.
b. any item falling under entry no.1,2,3,4,5,7,9,10,13,14,16,17,19,21,25,27 of
Schedule-I if the investment is less than Rs.100 crores for new projects and less
than Rs. 50 crores for expansion / modernization projects.
c. any item reserved for Small Scale Industrial Sector with investment less than
Rs. 1 crore.
d. defence related road construction projects in border areas.
e. any item falling under entry no. 8 of Schedule-I, if that product is covered by
the notification G.S.R. 1037(E) dated 5th December 1989.
f. Modernization projects in irrigation sector if additional command area is less
than 10,000 hectares or project cost is less than Rs. 100 crores.
4) Concealing factual data or submission of false, misleading data/reports, decisions or
recommendations would lead to the project being rejected. Approval, if granted earlier on
the basis of false data, would also be revoked. Misleading and wrong information will
cover the following:
o
o
o
False information
False data
Engineered reports
279
o
o
Concealing of factual data
False recommendations or decisions
SCHEDULE-I
(See paras 1 and 2)
LIST OF PROJECTS REQUIRING ENVIRONMENTAL CLEARANCE FROM THE
CENTRAL GOVERNMENT
1. Nuclear Power and related projects such as Heavy Water Plants, nuclear fuel complex,
Rare Earths.
2. River Valley projects including hydel power, major Irrigation and their combination
including flood control.
3. Ports, Harbours, Airports (except minor ports and harbours).
4. Petroleum Refineries including crude and product pipelines.
5. Chemical Fertilizers (Nitrogenous and Phosphatic other than single superphosphate).
6. Pesticides (Technical).
7. Petrochemical complexes (Both Olefinic and Aromatic) and Petro-chemical
intermediates such as DMT, Caprolactam, LAB etc. and production of basic plastics
such as LLDPE, HDPE, PP, PVC.
8. Bulk drugs and pharmaceuticals.
9. Exploration for oil and gas and their production, transportation and storage.
10. Synthetic Rubber.
11. Asbestos and Asbestos products.
12. Hydrocyanic acid and its derivatives.
13 (a) Primary metallurgical industries (such as production of Iron and Steel, Aluminium,
Copper, Zinc, Lead and Ferro Alloys).
(b) Electric arc furnaces (Mini Steel Plants).
14. Chlor alkali industry.
15. Integrated paint complex including manufacture of resins and basic raw materials
required in the manufacture of paints.
16. Viscose Staple fibre and filament yarn.
17. Storage batteries integrated with manufacture of oxides of lead and lead antimony
alloys.
18. All tourism projects between 200m—500 metres of High Water Line and at locations
with an elevation of more than 1000 metres with investment of more than Rs.5 crores.
19. Thermal Power Plants.
20. Mining projects (major minerals) with leases more than 5 hectares.
21. Highway Projects except projects relating to improvement work including widening
and strengthening of roads with marginal land acquisition along the existing
280
alignments provided it does not pass through ecologically sensitive areas such as
National Parks, Sanctuaries, Tiger Reserves, Reserve Forests
22. Tarred Roads in the Himalayas and or Forest areas.
23. Distilleries.
24. Raw Skins and Hides
25. Pulp, paper and newsprint.
26. Dyes.
27. Cement.
28. Foundries (individual)
29. Electroplating
30. Meta amino phenol
SCHEDULE-II
[See Sub-para I (a) of para 2]
Procedure for seeking environment clearance of projects.
1.
(1)
Any persons who desires to establish a thermal power plant of any category
mentioned n Schedule-I, shall submit an application to the Department of the State
Government dealing with the subject of environment.
(2)
The application shall be made in the Form ‘A’ specified in Schedule-II
annexed to this notification and shall be accompanied by a detailed project report which shall,
inter alia, include an Environmental Impact Assessment Report and an Environment
Management plant prepared n accordance with the guidelines issued by the State Department
of Environment from time to time.
(3)
Cases rejected due to submission of insufficient or inadequate data and Action
Plans may be reviewed as and when submitted with complete data and Action Plans.
Submission of incomplete data for the second time would itself be a sufficient reason for the
State Government to reject the case summarily.
5) In case of the pit-head thermal power plants, the applicant shall intimate the location of the
project site to the State Government while initiating any investigation and surveys. The State
Government will convey a decision regarding suitability or otherwise of the proposed site
within a maximum period of thirty days. The said site clearance will be granted for a
sanctioned capacity and it will be valid for a period of five years for commencing the
construction or operation of the project.
3.
(1)
The applicant shall obtained No Objection Certificate from the concerned
Pollution Control Board. The State Pollution Control Board shall issue No Objection
Certificate to establish only after completing public hearing as specified in Schedule-IV
annexed to this notification.
281
(2)
The reports submitted with the application and No Objection Certificate from
the State Pollution Control Board shall be evaluated and assessed by the State Government, in
consultation with a Committee of experts which shall be constituted by the State Government
as specified in Schedule-III appended to this notification.
(3)
The said Committee of experts shall have full right of entry and inspection of
the site or, as the case may be, factory premises at any time prior to, during or after the
commencement of the preparations relating to the plant.
(4)
The State Government Department dealing with the subject of Environment
shall prepare a set of recommendations based on technical assessment of documents and data
furnished by the applicant supplemented by data collected during visits to sites, if undertaken
and interaction with affected population and environment groups, if necessary.
(5)
The assessment shall be completed within a period of ninety days from receipt
of the requisite documents and data from the applicant and decision conveyed within thirty
days thereafter.
(6)
the environmental clearance granted shall be valid for a period of five years
from commencement of the construction or operation of the project.
4.
Concealing factual data or submission of false,
misleading data reports, decisions of recommendations would lead to the project being
rejected. Approval, if granted, earlier on the basis of false data, can also be revoked.
(FORM A)
APPLICATION FORM
1. (a) Name and Address of the project proposed :
(b) Location of the project:
Name of the Place:
District, Tehsil:
Latitude/Longitude:
Nearest Airport/Railway Station :
(c) Alternate sites examined and the reasons for selecting the proposed site:
(d) Does the site conform to stipulated land use as per local land use plan:
282
2.
Objectives of the project:
3.
(a) Land Requirement:
Agriculture Land:
Forest land and Density of vegetation.
Other (specify):
(b) (i) Land use in the Catchment within 10 kms radius of the proposed site:
(ii) Topography of the area indicating gradient, aspects and altitude:
(iii)Erodibility classification of the proposed land:
(c) Pollution sources existing in 10 km radius and their impact on quality of air, water
and land:
(d) Distance
of
the
nearest
National
Park/Sanctuary/Biosphere
Reserve/Monuments/heritage site/Reserve Forest:
(e) Rehabilitation plan for quarries/borrow areas:
(f) Green belt plan:
(g) Compensatory afforestation plan:
4. Climate and Air Quality:
(a)
(b)
(c)
(d)
(e)
(f)
Windrose at site:
Max/Min/Mean annual temperature:
Frequency of inversion:
Frequency of cyclones/tornadoes/cloud burst:
Ambient air quality data:
Nature & concentration of emission of SPM, Gas (CO, CO2, NOx, CHn etc.)
from the project:
5. Water balance:
(a) Water balance at site:
(b)
Lean season water availability;
Water Requirement:
(c) Source to be tapped with competing users (River, Lake, Ground, Public
supply):
(d) Water quality:
(e) Changes observed in quality and quantity of groundwater in the last years and
present charging and extraction details:
(f)
(i) Quantum of waste water to be released with
treatment details:
(ii)
Quantum of quality of water in the receiving body before and after
disposal of solid wastes:
(iii)
Quantum of waste water to be released on land and type of land:
(g) (i) Details of reservoir water quality with necessary Catchment Treatment
Plan:
(ii) Command Area Development Plan:
283
6.
Solid wastes:
(a) Nature and quantity of solid wastes generated
(b) Solid waste disposal method:
7.
Noise and Vibrations:
a.
b.
c.
d.
Sources of Noise and Vibrations:
Ambient noise level:
Noise and Vibration control measures proposed:
Subsidence problem, if any, with control measures:
8.
Power requirement indicating source of supply: Complete
environmental details to be furnished separately, if captive power unit proposed:
9.
Peak labour force to be deployed giving details of:
o Endemic health problems in the area due to waste water/air/soil borne diseases:
o Health care system existing and proposed:
10. (a) Number of villages and population to be displaced:
(b)
Rehabilitation Master Plan:
11.
Risk Assessment Report and Disaster Management Plan:
12. (a) Environmental Impact Assessment
(b) Environment Management Plan:
(c) Detailed Feasibility Report:
(d)
Duly filled in questionnaire
Report prepared as per guidelines issued by the Central Government in the MOEF from
time to time:
13.
Details of Environmental Management Cell:
I hereby give an undertaking that the data and information given above are due to the best
of my knowledge and belief and I am aware that if any part of the data/information submitted
is found to be false or misleading at any stage, the project be rejected and the clearance given,
if any, to the project is likely to be revoked at our risk and cost.
Signature of the applicant
With name and full address
Given under the seal of Organisation
on behalf of Whom the applicant is signing.
Date:
Place:
In respect to item for which data are not required or is not available as per the declaration of
project proponent, the project would be considered on that basis.
284
SCHEDULE-III
[See Sub. Para(2), Para 3 of Schedule- II]
COMPOSITION OF THE EXPERT COMMITTEES FOR ENVIRONMENTAL
IMPACT ASSESSMENT
1. The Committees will consist of experts in the following disciplines:
i.
ii.
iii.
iv.
v.
vi.
vii.
viii.
ix.
x.
xi.
Eco-system Management
Air/Water Pollution Control
Water Resource Management
Flora/Fauna conservation and management
Land Use Planning
Social Sciences/Rehabilitation
Project Appraisal
Ecology
Environmental Health
Subject Area Specialists
Representatives
of
NGOs/persons
environmental issues.
concerned
with
2. The Chairman will be an outstanding and experienced ecologist or environmentalist or
technical professional with wide managerial experience in the relevant development
sector.
3. The representative of Impact Assessment Agency will act as a Member-Secretary.
4. Chairman and Members will serve in their individual capacities except those
specifically nominated as representatives.
5. The Membership of a Committee shall not exceed 15.
SCHEDULE IV
(See para 3, subparagraph (2) of Schedule- II)
PROCEDURE FOR PUBLIC HEARING
(1) Process of Public Hearing: - Whoever apply for environmental clearance of projects,
shall submit to the concerned State Pollution Control Board twenty sets of the following
documents namely: i.
An executive summary containing the salient features of the project both in
English as well as the local language along with Environmental Impact
285
ii.
iii.
iv.
Assessment (EIA). However, for pipeline project, Environmental Impact
Assessment report will not be required. But Environmental Management Plan
including risk mitigation measures is required.
Form XIII prescribed under Water (Prevention and Control of Pollution) Rules,
1975 where discharge of sewage, trade effluents, treatment of water in any
form, is required.
Form I prescribed under Air (Prevention and Control of Pollution) Union
Territory Rules, 1983 where discharge of emissions are involved in any
process, operation or industry.
Any other information or document which is necessary in the opinion of the
Board for their final disposal of the application.
(2) Notice of Publics Hearing: -(i) The State Pollution Control Board shall cause a notice for
environmental public hearing which shall be published in at least two newspapers widely
circulated in the region around the project, one of which shall be in the vernacular language of
the locality concerned. State Pollution Control Board shall mention the date, time and place of
public hearing. Suggestions, views, comments and objections of the public shall be invited
within thirty days from the date of publication of the notification.
(ii) All persons including bona fide residents, environmental groups and others located at
the project site/sites of displacement/sites likely to be affected can participate in the
public hearing. They can also make oral/written suggestions to the State Pollution
Control Board.
Explanation: - For the purpose of the paragraph person means: a.
b.
c.
d.
any person who is likely to be affected by the grant of environmental
clearance;
any person who owns or has control over the project with respect to
which an application has been submitted for environmental clearance;
any association of persons whether incorporated or not like to be
affected by the project and/or functioning in the filed of environment;
any local authority within any part of whose local limits is within the
neighbourhood wherein the project is proposed to be located.
(3) Composition of public hearing panel: - The composition of Public Hearing Panel may
consist of the following, namely: (i) Representative of State Pollution Control Board;
(ii) District Collector or his nominee;
(iii)Representative of State Government dealing with the subject;
(iv) Representative of Department of the State Government dealing with Environment;
(v)
Not more than three representatives of the local bodies such as
Municipalities or panchayats;
(vi)
Not more than three senior citizens of the area nominated by the
District Collector.
286
(4) Access to the Executive Summary and Environmental Impact Assessment report:The concerned persons shall be provided access to the Executive Summary and
Environmental Impact Assessment report of the project at the following places, namely:(i) District Collector Office;
(ii) District Industry Centre;
(iii)In the Office of the Chief Executive Officers of Zila Praishad or Commissioner of
the Municipal Corporation/Local body as the case may be;
(iv) In the head office of the concerned State Pollution Control Board and its concerned
Regional Office;
(v) In the concerned Department of the State Government dealing with the subject of
environment.
5. Time period for completion of public hearing:
The public hearing shall be completed within a period of 60 days from the date of
receipt of complete documents as required under paragraph 1.
287
Amendment in Environment Protection Rules, 1986 (19.9.1997)
Copy of The Gazette of India
EXTRAORDINARY
PART II -- Section 3 Sub Section (I)
PUBLISHED BY AUTHORITY
MINISTRY OF ENVIRONMENT AND FORESTS
New Delhi, the 19TH September ,1197
GSR. 560(E) – In exercise of the powers conferred by sections 6 and 25 of the Environment
(Protection) Act, 1986 (29 of 1986) the Central Government hereby makes the following rules
further to amend the Environment (Protection) Rules namely”
1. (1 ) These rules may be called the Environment (Protection) Amendment Rules,
1997.
( 2 ) They shall come into force on the date of their publication in the Official
Gazette.
2. In the
Environment (Protection) Rules, 1986, after sub-rule (7) of
rule3,thefollowing sub-rule shall be inserted namely:On and from the 1st June, 2001, the following coal based thermal power
plants shall ;use beneficiated coal with an ash content not exceeding thirtyfour per cent, namely:( a ) any thermal power plant located beyond one thousand kilometers from
the pit-head and
( b) ) any thermal power plant located in urban area or sensitive area or critically
polluted area irrespective of their distance from pit-head power plant.
( 8)
Explanation:- For the purpose this rule:--
(a ) ‘beneficiated coal’ means coal containing higher calorific value but lower ash than the
original ash content in the raw coal obtained through physical separation or washing process;
(b)
‘pit-head power plant ‘ means power stations having captive transportation system for
its exclusive use for transportation of coal from the loading point at the mining end
288
(c)
upto ;the unloading point at the power station without using the normal public
transportation system;
‘sensitive area’ means an area whose ecological balance is prone to be easily
disturbed;
‘critically polluted area’ means the area where pollution level has
reached or likely to reach to the critical levels which has been identified
as such by the Central Government or Central Pollution Control Board or
a State Pollution Control Board.
(F.No. Z.16011/1/94-CPW)
VIJAI SHARMA
JOINT SECRETARY
FOOT NOTE: Principal rules were published in the Gazette of India vide S.O.
844(E) dated the 19th November, 1986 and subsequently amended vide:(1)
S.0. No. 433(E) dated 18.4.1987
(2)
S.0. No. 64(E) dated 18.1.1988
(3)
S.0. No.12(E) dated 8.1.1990
(4)
S.0. No. 3(E) dated 3.1.1989
(5)
S.0. No. 190(E) dated 15.3.1989
(6)
S.0. No. 913(E) dated 24.10.1989
(7)
S.0. No. 742(E) dated 30.8.1990
(8)
S.0. No.23(E) dated 16.1.1991
(9)
S.0. No. 913(E) dated 21.2.1991
(10)
S.0. No. 95(E) dated 12.2.1992
(11)
S.0. No. 329(E) dated 13.3.1992
(12)
S.0. No. 475(E) dated 5.5.1992
(13)
S.0. No.797(E) dated 1.10.1992
(14)
S.0. No. 386(E) dated 28.4.1993
(15)
S.0. No. 422(E) dated 19.5.1993
(16)
S.0. No.801(E) dated 31.12.1993
(17)
S.0. No.356(E) dated 4.5.1994
289
(18)
S.0. No.595(E) dated 188.1994
(19)
S.0. No. 73(E) dated 31.1.1997
(20)
S.0. No. 494(E) dated 9.7. 1997
290
Use of raw/ blended/ beneficiated coal in TPSs (3.7.1998)
Copy of The Gazette of India
EXTRAORDINARY
PART II -- Section 3 Sub Section (i)
PUBLISHED BY AUTHORITY
New Delhi, Friday July 3, 1998
MINISTRY OF ENVIRONMENT AND FORESTS
NOTIFICATION
New Delhi, the 30TH June ,1998
GSR. 378(E) – In exercise of the powers conferred by sections 6 and 25 of the Environment
(Protection) Act, 1986 (29 of 1986) the Central Government hereby makes the following rules
further to amend the Environment (Protection) Rules, 1986, namely:1. (1 ) These Rules may be called the Environment (Protection) Amendment
Rules, 1998.
( 2 ) They shall come into force on the date of their publication in the Official
Gazette.
2. In the Environment (Protection) Rules, 1986, in rule (3), sub-rule(8), i.
for the words “ beneficiated coal with an ash content not exceeding
thirty-four per cent”, the words “raw or blended or beneficiated coal
with an ash content not exceeding thirty-four per cent on an annual
average basis” shall be substituted;
ii.
after clause (b), the following proviso shall be inserted, namely:“Provided that any thermal power plant using Fluidized Bed
Combustion or circulating Fluidized Bed Combustion or Atmospheric
Fluidized Bed Combustion or Pressurised Fluidized Bed Combustion or
Integrated Gasification Combined Cycle Technologies or any other
clean technologies as may be notified by the Central Government in the
Official Gazette shall be exempted from clauses (a) and (b)”;
iii.
after explanation (d), the following explanation shall be inserted
namely:“(e) ‘Urban area’ means an area limit of a city having population of
more than 1 million according to 1991 census.”
291
(F.No. Z.16011/1/94-CPW)
VIJAI SHARMA
JOINT SECRETARY
FOOT NOTE: Principal rules were published in the Gazette of India vide S.O.
844(E) dated the 19th November, 1986 and subsequently amended vide:(1)
S.0. No. 433(E) dated 18.4.1987
(2)
S.0. No. 64(E) dated 18.1.1988
(3)
S.0. No. 8(E) dated 03.1.1989
(4)
S.0. No. 190(E) dated 15.3.1989
(5)
G.S.R. No. 913(E) dated 24.10.1989
(6)
S.0. No.12(E) dated 8.1.1990
(7)
G.S.R. No. 742(E) dated 30.08.1990
(8)
S.0. No.23(E) dated 16.1.1991
(9)
G.S.R No. 913 (E) dated 21.02.1991
(10)
G.S.R No. 95 (E) dated 12.02.1992
(11)
G.S.R No. 329 (E) dated 13.03.1992
(12)
G.S.R No. 475 (E) dated 5.05.1992
(13)
G.S.R No. 797 (E) dated 1.10.1992
(14)
G.S.R No. 386 (E) dated 28.04.1993
(15)
G.S.R No. 422 (E) dated 19.05.1993
(16)
G.S.R No. 801 (E) dated 31.12.1993
(17)
S.0. No.356 (E) dated 4.5.1994
(18)
S.0. No.595 (E) dated 18.8.1994
(19)
S.0. No.73 (E) dated 31.1.1997
(20)
S.0. No.494 (E) dated 9.7.1997
(21)
G.S.R. No.560 (E) dated 19.9.1997
292
MINISTRY OF ENVIRONMENT & FORESTS
(Department of Environment, Forests and Wildlife)
NOTIFICATION UNDER SECTION 3(1) AND SECTION 3(2)(v) OF THE
ENVIRONMENT (PROTECTION) ACT, 1986 AND RULE 5(3)(d) OF THE
ENVIRONMENT (PROTECTION) RULES, 1986 DECLARING COASTAL
STRETCHES AS COASTAL REGULATION ZONE (CRZ) AND
REGULATING ACTIVITIES IN THE CRZ.
New Delhi, the 19th February, 1991
(as amended up to 3rd October 2001)
S.O.114 (E). - Whereas a Notification under Section 3(1) and Section
3(2)(v) of the Environment (Protection) Act, 1986, inviting objections against
the declaration of Coastal Stretches as Coastal Regulation Zone (CRZ) and
imposing restrictions on industries, operations and processes in the CRZ was
published vide S.O. No.944 (E) dated 15th December, 1990.
And whereas all objections received have been duly considered by the
Central Government;
Now, therefore, in exercise of the powers conferred by Clause (d) of
sub-rule (3) of Rule 5 of the Environment (Protection) Rules, 1986, and all
other powers vesting in its behalf, the Central Government hereby declares the
coastal stretches of seas, bays, estuaries, creeks, rivers and backwaters which
are influenced by tidal action (in the landward side) upto 500 metres from the
High Tide Line (HTL) and the land between the Low Tide Line (LTL) and the
HTL as Coastal Regulation Zone; and imposes with effect from the date of this
Notification, the following restrictions on the setting up and expansion of
industries, operations or processes, etc. in the said Coastal Regulation Zone
(CRZ). For the purposes of this notification, the High Tide Line means the
line on the land upto which the highest water line reaches during the
spring tide. The High Tide Line shall be demarcated uniformly in all parts
of the country by the demarcating authority or authorities so authorised
by the Central Government, in accordance with the general guidelines
issued in this regard.1,6.
Note: -The distance from the High Tide Line shall1 apply to both
1
sides in the case of rivers, creeks and back waters and may be modified on a
case by case basis for reasons to be recorded while preparing the Coastal Zone
Management Plans.However, this distance shall not be less than 50* (*This
provision has been struck down by the Supreme Court ) 100 metres or the
width of the creek, river or backwater whichever is less.
The distance upto which development along rivers, creeks and backwaters is to be regulated shall be governed by the distance upto which the
tidal effect of sea is experienced in rivers, creeks or back-waters, as the
293
case may be, and should be clearly identified in the Coastal Zone
Management Plans.1
2.
2.Prohibited Activities:
The following activities are declared as prohibited within the Coastal
Regulation Zone, namely:
(i)
(i)setting up ofnew industries and expansion of existing industries, except (a)10
those directly related to water front or directly needing foreshore facilities and
(b) Projects of Department of Atomic Energy;10
(ii)
(ii)manufacture or handling or storage or disposal of
hazardous substances as specified in the Notifications of
the Government of India in the Ministry of Environment
and Forests No. S.O. 594(E) dated 28th July 1989, S.O.
966(E) dated 27th November, 1989 and GSR 1037(E)
dated 5th December, 1989; except transfer of
hazardous substances from ships to ports, terminals
and refineries and vice versa in the port areas:3
Provided that,facilities for receipt and storage of petroleum
products and Liquefied Natural Gas as specified in Annexure-III
appended to this notification and facilities for regasification of
Liquefied Natural Gas, may be permitted within the said Zone in
areas not classified as CRZ-I (i), subject to implementation of safety
regulations including guidelines issued by the Oil Industry Safety
Directorate in the Government of India, Ministry of Petroleum and
Natural Gas and guidelines issued by the Ministry of Environment
and Forests and subject to such further terms and conditions for
implementation of ameliorative and restorative measures in
relation to the environment as may be stipulated by the
Government of India in the Ministry of Environment and Forests
(iii)
Setting up and expansion of fish processing units
including warehousing (excluding hatchery and natural
fish drying in permitted areas);
Provided that existing fish processing units for
modernisation purposes may utilise twenty five per cent additional
plinth area required for additional equipment and pollution control
measures only subject to existing Floor Space index/ Floor Area
Ratio norms and subject to the condition that the additional plinth
area shall not be towards seaward side of existing unit and also
subject to the approval of State Pollution Control Board or
Pollution Control Committee.
(iv)
(iv)setting up and expansion of units/mechanism for
disposal of waste and effluents, except facilities required
for discharging treated effluents into the water course
with approval under the Water (Prevention and Control
of Pollution) Act, 1974; and except for storm water
drains;
294
(v)discharge of untreated wastes and effluents from
industries, cities or towns and other human
settlements.Schemes shall be implemented by the
concerned authorities for phasing out the existing
practices, if any, within a reasonable time period not
exceeding three years from the date of this notification;
(vi)
dumping of city or town waste for the purposes of
landfilling or otherwise; the existing practice, if any,
shall be phased out within a reasonable time not
exceeding three years from the date of this Notification;
(vii) (vii)dumping of ash or any wastes from thermal power
stations;
(viii) (viii)Land reclamation, bunding or disturbing the natural
course of sea water except those required
for construction or modernisation or expansion of
ports, harbours, jetties, wharves, quays, slipways,
bridges and sea-links and for other facilities that are
essential for activities permissible under the notification
or for control of coastal erosion and maintenance or
clearing of water ways, channels and ports or for
prevention of sandbars or for tidal regulators, storm
water drains or for structures for prevention of salinity
ingress and sweet water recharge:
provided that reclamation for commercial purposes
such as shopping and housing complexes, hotels and
entertainment activities shall not be permissible;
(ix)
(ix)Mining of sands, rocks and other substrata materials,
except (a) those rare minerals not available outside the
CRZ areas and (b) exploration and extraction of Oil
and Natural Gas
Provided that in the Union Territory of the Andaman and
Nicobar islands, mining of sands may be permitted by the
Committee which shall be constituted by the Lieutenant
Governor of the Andaman and Nicobar Islands consisting of
Chief Secretary; Secretary, Department of Environment;
Secretary, Department of Water Resources; and Secretary,
Public Works Department. The said Committee may permit
mining of sand from non-degraded areas for construction
purposes from selected sites, in a regulated manner on a case
to case basis, for a period upto the 30th day of September,
2002.The quantity of sand mined shall not exceed the
essential requirements for completion of construction works
including dwelling units, shops in respect of half yearly
requirements of 2001-2002 and 2002-2003 annual plans.The
permission for mining of sand may be given on the basis of a
(v)
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3.
mining plan from such sites and in such quantity which shall
not have adverse impacts on the environment.
(x)
(x)harvesting or drawal of ground water and construction
of mechanisms therefor within 200 m of HTL; in the
200m to 500m zone it shall be permitted only when done
manually through ordinary wells for drinking,
horticulture, agriculture and fisheries;
Provided that drawal of ground water is permitted, where
no other source of water is available and when done
manually through ordinary wells or hand pumps, for
drinking and domestic purposes, in the zone between 50 to
200 m from High Tide Line in case of seas, bays and
estuaries and within 200 m or the CRZ, whichever is less,
from High Tide Line in case of rivers, creeks and
backwaters subject to such restrictions as may be deemed
necessary, in areas affected by sea water intrusion, that may
be imposed by an authority designated by State
Government/Union Territory Administration.
(xi)
(xi)construction activities in CRZ -I except as specified
in Annexure -I of this notification;
(xii) (xii)any construction activity between the Low Tide Line
and High Tide Line except facilities for carrying treated
effluents and waste water discharges into the sea,
facilities for carrying sea water for cooling purposes, oil,
gas and similar pipelines and facilities essential for
activities permitted under this Notification; and
(xiii) (xiii)dressing or altering of sand dunes, hills, natural
features including landscape changes for beautification,
recreational and other such purpose, except as
permissible under this Notification.
3.Regulation of Permissible Activities:
All other activities, except those prohibited in para 2 above, will be
regulated as under:
(1)
(1)Clearance shall be given for any activity within the
Coastal Regulation Zone only if it requires water front
and foreshore facilities.
(2)
(2)The following activities will require environmental
clearance from the Ministry of Environment and Forests,
Government of India, namely:
(i)
(i)Construction activities related to projects of
Department of Atomic Energy or Defence
requirements for which foreshore facilities are
essential such as. slipways, jetties, wharves,
quays; except for classified operational
component of defence projects for which a
separate procedure shall be followed.(Residential
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buildings, office buildings, hospital complexes,
workshops shall not come within the definition of
operational requirements except in very special
cases and hence shall not normally be permitted
in the CRZ;
(ii)
(ii)Operational constructions for ports and
harbours and light houses and constructions for
activities such as jetties, wharves, quays and
slipways, pipelines, conveying systems
including transmission lines;
(ii) a Exploration and extraction of oil and natural
gas and all associated activities and facilities
thereto;
(iii) (iii)Thermal Power Plants (only foreshore
facilities for transport of raw materials facilities
for intake of cooling water and outfall for
discharge of treated waste water/cooling water);
and
(iv)
(iv)All other activities with investment exceeding
rupees five crores except those activities which
are to be regulated by the concerned
authorities at the State/Union Territory level
in accordance with the provisions of
paragraph 6, sub-paragraph (2) of Annexure 1
of the notification.
(3) (i) The Coastal States and Union Territory Administrations
shall prepare, within a period of one year from the date
of this Notification, Coastal Zone Management Plans
identifying and classifying the CRZ areas within their
respective territories in accordance with the guidelines
given in Annexures I and II of the Notification and
obtain approval (with or without modifications) of the
Central Government in the Ministry of Environment &
Forests;
(ii)
Within the framework of such approved plans, all
development and activities within the CRZ other than
those covered in para 2 and para 3(2) above shall be
regulated by the State Government, Union Territory
Administration or the local authority as the case may be
in accordance with the guidelines given in Annexure-I
and II of the Notification; and
(iii)
(iii)In the interim period till the Coastal Zone
management Plans mentioned in para 3(3) (i) above are
prepared and approved, all developments and activities
within the CRZ shall not violate the provisions of this
Notification.State Governments and Union Territory
297
4.
Administrations shall ensure adherence to these
regulations and violations, if any, shall be subject to the
provisions of the Environment (Protection) Act, 1986.
4.Procedure for monitoring and enforcement:
The Ministry of Environment & Forests and the Government of State or
Union Territory and such other authorities at the State or Union
Territory levels, as may be designated for this purpose, shall be
responsible for monitoring and enforcement of the provisions of this
notification within their respective jurisdictions.
ANNEXURE - I
COASTAL AREA CLASSIFICATION AND DEVELOPMENT
REGULATIONS
Classification of Coastal Regulation Zone:
6(1) For regulating development activities, the coastal stretches
within 500 metres of High Tide Line on the landward side are classified into
four categories, namely:
Category I (CRZ-I):
(i)
Areas that are ecologically sensitive and important, such as
national parks/marine parks, sanctuaries, reserve forests,
wildlife habitats, mangroves, corals/coral reefs, areas close to
breeding and spawning grounds of fish and other marine life,
areas of outstanding natural beauty/historically/heritage areas,
areas rich in genetic diversity, areas likely to be inundated due
to rise in sea level consequent upon global warming and such
other areas as may be declared by the Central Government or
the concerned authorities at the State/Union Territory level from
time to time.
(ii)
(ii)Area between Low Tide Line and the high Tide Line.
Category-II (CRZ-II):
The areas that have already been developed upto or close to the
shoreline.For this purpose, “developed area” is referred to as that area within
the municipal limits or in other legally designated urban areas which is already
substantially built up and which has been provided with drainage and approach
roads and other infrastructural facilities, such as water supply and sewerage
mains.
Category-III (CRZ-III):
Areas that are relatively undisturbed and those which do not belong to
either Category-I or II. These will include coastal zone in the rural areas
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(developed and undeveloped) and also areas within Municipal limits or in other
legally designated urban areas which are not substantially built up.
Category-IV (CRZ-IV):
Coastal stretches in the Andaman & Nicobar, Lakshadweep and small
islands, except those designated as CRZ-I, CRZ-II or CRZ-III.
Norms for Regulation of Activities.
6(2) The development or construction activities in different
categories of CRZ area shall be regulated by the concerned authorities at the
State/Union Territory level, in accordance with the following norms:
CRZ-I
No new construction shall be permitted in CRZ- I except (a)
Projects relating to Department of Atomic Energy and (b) Pipelines,
conveying systems including transmission lines and (c) facilities that are
essential for activities permissible under CRZ-I.Between the LTL and the
HTL, activities as specified under paragraph 2 (xii) may be permitted. In
addition, between LTL and HTL in areas which are not ecologically
sensitive and important, the following may be permitted: (a) Exploration
and extraction of Oil and Natural Gas, (b) activities as specified under
proviso of sub-paragraph (ii) of paragraph 2, and (c) Construction of
dispensaries, schools, public rain shelters, community toilets, bridges,
roads, jetties, water supply, drainage, sewerage which are required for
traditional inhabitants of the Sunderbans Bio-sphere reserve area, West
Bengal, on a case to case basis, by the West Bengal State Coastal Zone
Management Authority
CRZ-II
(i)
(i)Buildings shall be permitted only on the landward side of
the existing road (or roads approved in the Coastal Zone
Management Plan of the area) or on the landward side of
existing authorised structures.Buildings permitted on the
landward side of the existing and proposed roads/existing
authorised structures shall be subject to the existing local Town
and Country Planning Regulations including the existing norms
of Floor Space Index/Floor Area Ratio:
Provided that no permission for construction of buildings
shall be given on landward side of any new roads (except
roads approved in the Coastal Zone Management Plan)
which are constructed on the seaward side of an existing
road.
(ii)
(ii)Reconstruction of the authorised buildings to be permitted
subject to the existing FSI/FAR norms and without change in
the existing use.
(iii) (iii)The design and construction of buildings shall be consistent
with the surrounding landscape and local architectural style.
CRZ-III
(i)
(i)The area upto 200 metres from the High Tide Line is to be
earmarked as ‘No Development Zone’.No construction shall be
299
(ii)
(iii)
(iv)
permitted within this zone except for repairs of existing
authorised structures not exceeding existing FSI, existing plinth
area and existing density, and for permissible activities under
the notification including facilities essential for such
activities. An authority designated by the State
Government/Union Territory Administration may permit
construction of facilities for water supply, drainage and
sewerage for requirements of local inhabitants.However, the
following uses may be permissible in this zone – agriculture,
horticulture, gardens, pastures, parks, play fields, forestry and
salt manufacture from sea water.
(ii)Development of vacant plots between 200 and 500 metres of
High Tide Line in designated areas of CRZ-III with prior
approval of Ministry of Environment and Forests (MEF)
permitted for construction of hotels/beach resorts for temporary
occupation of tourists/visitors subject to the conditions as
stipulated in the guidelines at Annexure-II.
(iii)Construction/reconstruction of dwelling units between 200
and 500 metres of the High TideLine permitted so long it is
within the ambit of traditional rights and customary uses such as
existing fishing villages and gaothans. Building permission for
such construction/reconstruction will be subject to the
conditions that the total number of dwelling units shall not be
more than twice the number of existing units; total covered area
on all floors shall not exceed 33 percent of the plot size; the
overall height of construction shall not exceed 9 metres and
construction shall not be more than 2 floors ground floor plus
one floor. Construction is allowed for permissible activities
under the notification including facilities essential for such
activities.An
authority
designated
by
State
Government/Union Territory Administration may permit
construction of public rain shelters, community toilets,
water supply, drainage, sewerage, roads and bridges.The
said authority may also permit construction of schools and
dispensaries, for local inhabitants of the area, for those
panchayats the major part of which falls within CRZ if no
other area is available for construction of such facilities.
(iv)Reconstruction/alterations of an existing authorised building
permitted subject to (i) to (iii) above.
CRZ-IV
Andaman & Nicobar Islands:
(i)
(i)No new construction of buildings shall be permitted
within 200 metres of the HTL;
(ii)
(ii)The buildings between 200 and 500 metres from the
High Tide Line shall not have more than 2 floors
(ground floor and first floor),the total covered area on all
300
floors shall not be more than 50 per cent of the plot size
and the total height of construction shall not exceed 9
metres;
(iii)
(iii)The design and construction of buildings shall be
consistent with the surrounding landscape and local
architectural style.
(iv) (a) Corals from the beaches and coastal waters shall not
be used for construction and other purposes.
(b)
sand may be used from the beaches and coastal
waters, only for construction purpose upto the 30th
day of September 2002 and thereafter it shall not be
used for construction and other purposes.
(iv)
(iv)Dredging and underwater blasting in and around coral
formations shall not be permitted; and
(v)
(v)However, in some of the islands, coastal stretches may also
be classified into categories CRZ-I or II or III with the prior
approval of Ministry of Environment and Forests and in such
designated stretches, the appropriate regulations given for
respective Categories shall apply.
Lakshadweep and small Islands:
(i)
(i)For permitting construction of buildings, the distance
from the High Tide Line shall be decided depending on
the size of the islands.This shall be laid down for each
island, in consultation with the experts and with approval
of the Ministry of Environment & Forests, keeping in
view the land use requirements for specific purposes visà-vis local conditions including hydrological aspects
erosion and ecological sensitivity;
(ii)
(ii)The buildings within 500 metres from the HTL shall
not have more than 2 floors (ground floor and 1st floor),
the total covered area on all floors shall not be more than
50 per cent of the plot size and the total height of
construction shall not exceed 9 metres;
(iii)
(iii)The design and construction of buildings shall be
consistent with the surrounding landscape and local
architectural style;
(iv)
(iv)Corals and sand from the beaches and coastal waters
shall not be used for construction and other purposes;
(v)
(v)Dredging and underwater blasting in and around coral
formations shall not be permitted; and
(vi)
(vi)However, in some of the islands, coastal stretches
may also be classified into categories CRZ-I or II or III,
with the prior approval of Ministry of Environment &
Forests and in such designated stretches, the appropriate
regulations given for respective Categories shall apply.
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Annexure – II
GUIDELINES FOR DEVELOPMENT OF BEACH RESORTS/HOTELS IN
THE DESIGNAED AREAS OF CRZ-III FOR TEMPORARY OCCUPATION
OF TOURIST/VISITORS, WITH PRIOR APPROVAL OF THE MINISTRY
OF ENVIRONMENT & FORESTS.
7(1) Construction of beach resorts/hotels with prior approval of MEF
in the designated areas of CRZ-III for temporary occupation of
tourists/visitors shall be subject to the following conditions:
(i)
(i)The project proponents shall not undertake any
construction (including temporary constructions and
fencing or such other barriers) within 200 metres (in the
landward wide) from the High Tide Line and within the
area between the Low Tide and High Tide Line;
(ia)
live fencing and barbed wire fencing with vegetative
cover may be allowed around private properties
subject to the condition that such fencing shall in no
way hamper public access to the beach;
(ib)
no flattening of sand dunes shall be carried out;
(ic)
no permanent structures for sports facilities shall be
permitted except construction of goal posts, net posts
and lamp posts.
(id)
construction of basements may be allowed subject to
the condition that no objection certificate is obtained
from the State Ground Water Authority to the effect
that such construction will not adversely affect free
flow of ground water in that area.The State Ground
Water Authority shall take into consideration the
guidelines issued by the Central Government before
granting such no objection certificate.
Explanation:
Though no construction is allowed in the no development zone for the
purposes of calculation of FSI, the area of entire plot including 50% of the
portion which falls within the no development zone shall be taken into
account.
(ii)
(ii)The total plot size shall not be less than 0.4 hectares
and the total covered area on all floors shall not exceed
33 per cent of the plot size i.e. the FSI shall not exceed
0.33.The open area shall be suitably landscaped with
appropriate vegetal cover;
(iii)
(iii)The construction shall be consistent with the
surrounding landscape and local architectural style;
(iv)
(iv)The overall height of construction upto highest ridge
of the roof, shall not exceed 9 metres and the
construction shall not be more than 2 floors (ground
floor plus one upper floor);
302
(v)
(v)Ground water shall not be tapped within 200m of the
HTL; within the 200 metre – 500 metre zone, it can be
tapped only with the concurrence of the Central/State
Ground Water Board;
(vi)
(vi)Extraction of sand, levelling or digging of sandy
stretches except for structural foundation of building,
swimming pool shall not be permitted within 500 metres
of the High Tide Line;
(vii) (vii)The quality of treated effluents, solid wastes,
emissions and noise levels, etc. from the project area
must conform to the standards laid down by the
competent authorities including the Central/State
Pollution Control Board and under the Environment
(Protection) Act, 1986;
(viii) (viii)Necessary arrangements for the treatment of the
effluents and solid wastes must be made.It must be
ensured that the untreated effluents and solid wastes are
not discharged into the water or on the beach; and no
effluent/solid waste shall be discharged on the beach;
(ix)
(ix)To allow public access to the beach, at least a gap of
20 metres width shall be provided between any two
hotels/beach resorts; and in no case shall gaps be less
than 500 metres apart; and
(x)
(x)If the project involves diversion of forest land for
non-forest purposes, clearance as required under the
Forest (Conservation) Act, 1980 shall be obtained.The
requirements of other Central and State laws as
applicable to the project shall be met with.
(xi)
(xi)Approval of the State/Union Territory Tourism
Department shall be obtained.
7(2) In ecologically sensitive areas (such as marine parks,
mangroves, coral reefs, breeding and spawning grounds of fish, wildlife
habitats and such other areas as may notified by the Central/State
Government/Union Territories) construction of beach resorts/hotels
shall not be permitted.
Annexure - III
[See paragraph 2, sub-paragraph (ii)]
List of Petroleum Products Permitted for Storage in Coastal Regulation
Zone except CRZ I- (i)
(i)
(i)Crude Oil;
(ii)
(ii)Liquefied Petroleum Gas;
(iii) (iii)Motor Spirit;
(iv)
(iv)Kerosene;
(v)
(v)Aviation Fuel;
303
(vi)
(vii)
(viii)
(ix)
(x)
(xi)
(xii)
(xiii)
(xiv)
(vi)High Speed Diesel;
(vii)Lubricating Oil;
(viii)Butane;
(ix)Propane;
(x)Compressed Natural Gas;
(xi)Naphtha;
(xii)Furnace Oil;
(xiii)Low Sulphur Heavy Stock.
(xiv)Liquefied Natural Gas (LNG)
Environmental clearances accorded by the Ministry of Surface Transport from 9th July
1997 till the publication of this notification are valid. All proposals for environment
clearance pending with the Ministry of Surface Transport stand transferred to Ministry
of Environment and forests from the date of publication of this notification.
The principal notification was published in the Gazette of India vide number S.O. 114(E),
dated, the 19th February, 1991 (Corrigendum number S.O 190(E) dated 18th March 1991) and
subsequently amended vide: (i)
(i)S.O. 595 (E) dated 18th August 1994(Corrigendum S.O.690 (E) dated 19th
September 1994.)
(ii)
(ii)S.O. 73 (E) dated 31st January 1997.
(iii) (iii) S.O. 494 (E) dated 9th July 1997.(Corrigendum S.O.735(E) dated 21st
October 1997.)
(iv)
(iv)S.O. 334 (E) dated 20th April 1998.
(v)
(v)S.O. 873 (E) dated 30th September 1998.
(vi)
(vi)S.O. 1122 (E) dated 29th December 1998.
(vii) (vii)S.O.998 (E) dated 29th September 1999.
(viii) (viii)S.O.730 (E) dated 4th August 2000
(ix)
(ix)S.O. 900(E) dated 29th September 2000
(x)
(x)S.O. 329 (E) dated 12th April 2001(Corrigendum S.O. 776 (E) dated 13th
August 2001.)
(xi)
(xi)S.O. 988 (E) dated 3rd October 2001.
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Guidelines for determination of tariff by bidding process for procurement of power by
distribution licensees (19.01.2005)
The Gazette of India
EXTRAORDINARY
PART I - Section 1
PUBLISHED BY AUTHORITY
Ministry of Power
New Delhi,
th
Dated the 19 January, 2005
RESOLUTION
No. 23/11/2004-R&R (Vol.II)
Guidelines for Determination of Tariff by Bidding Process for Procurement of Power by
Distribution Licensees
1. Preamble
Promotion of competition in the electricity industry in India is one of the key
objectives of the Electricity Act, 2003 (the Act). Power purchase costs constitute the largest
cost element for distribution licensees. Competitive procurement of electricity by the
distribution licensees is expected to reduce the overall cost of procurement of power and
facilitate development of power markets. Internationally, competition in wholesale electricity
markets has led to reduction in prices of electricity and in significant benefits for consumers.
Section 61 & 62 of the Act provide for tariff regulation and determination of tariff of
generation, transmission, wheeling and retail sale of electricity by the Appropriate
Commission. Section 63 of the Act states that –
“Notwithstanding anything contained in section 62, the Appropriate
Commission shall adopt the tariff if such tariff has been determined
through transparent process of bidding in accordance with the guidelines
issued by the Central Government.”
These guidelines have been framed under the above provisions of section 63 of the
Act. The specific objectives of these guidelines are as follows:
305
1. Promote competitive procurement of electricity by distribution licensees;
2. Facilitate transparency and fairness in procurement processes;
3. Facilitate reduction of information asymmetries for various bidders;
4. Protect consumer interests by facilitating competitive conditions in procurement of
electricity;
5. Enhance standardization and reduce ambiguity and hence time for materialization of
projects;
6. Provide flexibility to suppliers on internal operations while ensuring certainty on
availability of power and tariffs for buyers.
2. Scope of the Guidelines
2.1. These guidelines are being issued under the provisions of Section 63 of the
Electricity Act, 2003 for procurement of electricity by distribution licensees
(Procurer) for:
(a) long-term procurement of electricity for a period of 7 years and above;
(b) Medium term procurement for a period of upto 7 years but exceeding 1
year.
2.2. The guidelines shall apply for procurement of base-load, peak-load and
seasonal power requirements through competitive bidding, through the
following mechanisms:
(i) Where the location, technology, or fuel is not specified by the procurer
(Case 1);
(ii) For hydro-power projects, load center projects or other location specific
projects with specific fuel allocation such as captive mines available, which the
procurer intends to set up under tariff based bidding process (Case 2).
2.3. Unless explicitly specified in these guidelines, the provisions of these
guidelines shall be binding on the procurer. The process to be adopted in event
of any deviation proposed from these guidelines is specified later in these
guidelines under para 5.16.
2.4. Procurement by more than one distribution licensee through a combined
bid process shall be permitted. For such combined procurement, each procurer
shall provide the necessary information required as per these guidelines. To
ensure standardization in evaluation of bids, the payment security and other
commercial terms offered to the bidders by the various procurers shall not vary.
The price offered by the bidders shall also be the same for the distribution
licensees inviting the bid.
2.5. All obligations on part of the procurers for the bid process shall be
considered to be met only when each and every procurer meets such
obligations set out in the Request for Proposal (RFP). This shall, however, not
preclude the bidder from waiving such stipulation if the bidder finds it
306
reasonable to do so, and the same shall not be construed to be violation of these
guidelines.
3. Preparation for inviting bids
3.1. To expedite the bid process, the following conditions shall be met by the
procurer:
(i) The bid documentation shall be prepared in accordance with these
guidelines and the approval of the appropriate Regulatory Commission shall be
obtained unless the bid documents are as per the standard bid documents issued
by the Central Government. In such cases, an intimation shall be sent by the
procurer to the appropriate Regulatory Commission about initiation of the
bidding process.
(ii) Approval of the Appropriate Commission shall be sought in event of the
deviations from the bidding conditions contained in these guidelines, following
the process described in para 5.16 of these guidelines.
(iii) Approval of the Appropriate Commission shall be sought prior to initiating
the bidding process in respect of the following aspects:
(a) For the quantum of capacity / energy to be procured, in case the same is exceeding the
projected additional demand forecast for next three years (Both for Case 1 and Case 2).
(b) For the transfer price of fuel, in case of fuel specific procurement enquiry, if such price
has not been determined by government, government approved mechanism or a fuel
regulator (under Case 2).
3.2. For long-term procurement from hydro electric projects or for projects for
which pre-identified sites are to be utilized (Case 2), the following activities should
be completed by the procurer, or authorized representative of the procurer, before
commencing the bid process:
• Site identification and land acquisition required for the project
• Environmental clearance
• Fuel linkage, if required (may also be asked from bidder)
• Water linkage
• Requisite Hydrological, geological, meteorological and seismological data necessary
for preparation of Detailed Project Report (DPR), where applicable.
The bidder shall be free to verify geological data through his own sources, as the
geological risk would lie with the project developer.
The project site shall be transferred to the successful bidder at a declared price.
307
3.3. It is recommended that the procurer should obtain the transmission clearances
necessary for receiving power at the delivery points prior to inviting bids. However
this shall not be a binding condition for the bid process. Unless otherwise specified in
the bid documents, it shall be the responsibility of the selected bidder to obtain
transmission linkage for evacuation and inter-State transmission of power (where
applicable).
4. Tariff Structure
4.1. For procurement of electricity under these guidelines, tariff shall be paid and
settled for each payment period (not exceeding one month). A multi-part tariff
structure featuring separate capacity and energy components of tariff shall
ordinarily form the basis for bidding. However, for medium term procurement the
procurer may, at his option, permit bids on a single part basis, and the same shall
be clearly specified in the Request for Qualification (RFQ) / Request for Proposal
(RFP).
4.2. In case of long term procurement with specific fuel allocation (Case 2), the
procurer shall invite bids on the basis of capacity charge and net quoted heat rate.
The net heat rate shall be ex-bus taking into account internal power consumption of
the power station. The energy charges shall be payable as per the following
formula :
Energy Charges = Net quoted heat rate X Scheduled Generation X
Monthly Weighted Average Price of Fuel / Monthly
Average Gross Calorific Value of Fuel.
If the price of the fuel has not been determined by the Government of India,
government approved mechanism or the Fuel Regulator, the same shall have to be
approved by the appropriate Regulatory Commission.
In case of coal / lignite fuel, the cost of secondary fuel oil shall be factored in the
capacity charges.
4.3. Tariffs shall be designated in Indian Rupees only. Foreign exchange risks, if any, shall be
borne by the supplier. Transmission charges in all cases shall be borne by the procurer.
Capacity charges
4.4. Capacity charge shall be paid based on actual availability in kwh, as per charges
quoted in Rs/kwh and shall be limited to the normative availability (or normative
capacity index for hydro electric stations). The normative availability shall be aligned to
308
the level specified in the tariff regulations of the Central Electricity Regulatory
Commission (CERC) prevailing at the time of the bid process, and shall be computed on
annual basis. The capacity component of tariffs may feature separate non-escalable
(fixed) and escalable (indexed) components. The indices to be adopted for escalation of
the escalable component shall only be Wholesale Price Index (WPI) or Consumer Price
Index (CPI) and the Base year shall be specified in the bid document.
4.5. Capacity charges for supply beyond the normative availability shall be a prespecified percentage of the non-escalable component of the capacity charges, and shall
be based on the availability of the plant beyond the normative availability. The
percentage applicable shall be specified in the RFP, and shall be limited to a 40% of the
non-escalable component of the capacity charges. For procurement of Case-2 type (in
reference to para 2.2.), the procurer shall have first right of refusal on energy generated
beyond normative availability. In case actual availability is less than the normative
availability, capacity charges shall not be payable for the shortfall compared to the
normative availability. In such case a penalty at the rate of 20% of the capacity charge
shall be applicable to the extent of the shortfall in availability.
4.6. The seller (successful bidder) shall declare availability on a daily basis in
accordance with the scheduling procedure as stipulated in the Indian Electricity Grid
Code (IEGC) from time to time. Further the seller and procurer shall comply with all
relevant provisions of the IEGC. If the procurer does not avail generation up to declared
availability, the same can be sold in market by the seller, and sale realization in excess of
variable charges shall be equally shared with the procurer.
4.7. Any change in tax on generation or sale of electricity as a result of any change in
Law with respect to that applicable on the date of bid submission shall be adjusted
separately.
4.8. Ratio of minimum and maximum capacity charge for any year shall not be less than
0.7 to avoid excessive front loading or back loading during the period of contract.
4.9. In case peakload or seasonal requirements are distinct from baseload requirements,
the bidders shall indicate distinct prices for such peakload or seasonal supply which shall
be evaluated separately. Differential rates quoted for the same source of power for base
and peak/seasonal load shall not constitute violation of guideline or unfair practice.
4.10. Adequate payment security shall be made available to the bidders. The payment
security may constitute:
(i)
Letter of Credit (LC)
(ii) Letter of Credit (LC) backed by credible escrow mechanism.
In the case the seller does not realize full payment from the procurer by the due date as
per payment cycle, the seller may after 7 days, take recourse to payment security
mechanism by encashing the LC to the extent of short fall or take recourse to escrow
mechanism. The procurer shall restore the payment security mechanism prior to the
next date of payment. Failure to realize payment even through payment security
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mechanism shall constitute an event of payment default. In the event of payment
default the seller, after giving 7 days notice, can sell up to 25% of the contracted
power to other parties without loosing claim on the capacity charges due from the
procurer. If the payment security mechanism is not fully restored within 30 days of the
event of the payment default, the seller can sell full contracted power to other parties
without loosing claim on the capacity charges due from the procurer. The surplus over
energy charges recovered from sale to such other parties shall be adjusted against the
capacity charge liability of the procurer. In case the surplus over energy charges is
higher than the capacity charge liability of the procurer, such excess over the capacity
charge liability shall be retained by the seller.
Energy Charges
4.11. Where applicable, the energy charges payable during the operation of the
contract shall be related on the base energy charges specified in the bid with
suitable provision for escalation. In case the bidder provides firm energy charge
rates for each of the years of the contract term, the same shall be permitted in the
tariffs. In other cases, the energy charges shall be payable in accordance with fuel
escalation index used for evaluation of the bid. In case of bids based on net heat
rate, the price of fuel shall be taken as stipulated under para 4.2. However, the fuel
escalation will be subject to any administered price mechanism of Government or
independent regulatory price fixation in case of fuel produced within the country.
The applicable indices for various fuels shall be identified in the RFP documents.
4.12. No adjustment shall be provided for heat rate degradation of the generating
stations. Even in case of bids based on net heat rate, the bidder shall factor in site
conditions, loading conditions, frequency variations etc and no adjustment shall be
allowed on the quoted net heat rate for the duration of the contract.
4.13. In case a bidder offers hydro power, under Case 1 or the procurer invites bids of
hydro power under Case 2, the hydrological risk shall be borne by the Procurer,
provided the hydrological data of such a project is based on authentic sources and
is known to the parties in advance. Any hydrological advantages resulting in
energy availability beyond the design energy shall be passed on to the Procurer
without any charge. The geological risk for the hydro project shall be borne by the
developer.
4.14. Energy charges shall be payable by the procurer to the seller for the scheduled
energy. Deviations beyond agreed energy schedules shall be settled under the
ABT/UI mechanism.
Combined capacity and energy charges
4.15. In cases where the procurement process permits bidders to submit combined
capacity and energy charges, the charges proposed shall be firm for each of the
years of the term of the Power Purchase Agreement (PPA), and no escalation of
tariffs shall be permitted over and above the rates proposed by the seller in the
price bid.
310
4.16. The bidder shall specify the normative availability from the project on an annual
basis. The model PPA made available to the bidders at the RFQ/RFP stage shall
feature appropriate provisions for penalties in event of the normative availability
not being met by the seller. The RFQ/RFP shall also specify minimum offtake
conditions for procurement from such stations.
4.17. The per kwh rates payable to the seller for offtake by the procurer over and
above the normative levels shall be the same as the rates applicable till normative
availability. In case the procurer does not schedule the energy made available by
the seller as per the contract, the seller shall be free to sell to other parties. The
seller shall not be required to make any payments to the procurer for such sales to
third parties.
5. Bidding Process
Two-stage process
5.1. For long-term procurement under these guidelines, a two-stage process featuring
separate Request for Qualification (RFQ) and Request for Proposal (RFP) stages shall
be adopted for the bid process under these guidelines. The procurer may, at his option,
adopt a single stage tender process for medium term procurement, combining the RFP
and RFQ processes. Procurer or authorized representative shall prepare bid documents
including the RFQ and RFP in line with these guidelines and standard bid documents.
5.2. The procurer shall publish a RFQ notice in at least two national newspapers,
company website and preferably in trade magazines also to accord it wide publicity.
The bidding shall necessarily be by way of International Competitive Bidding (ICB).
For the purpose of issue of RFQ minimum conditions to be met by the bidder shall be
specified by the procurer in the RFQ notice.
5.3. Procurer shall provide only written interpretation of the tender document to any
bidder / participant and the same shall be made available to all other bidders. All
parties shall rely solely on the written communication and acceptances from the
bidders.
5.4. Standard documentation to be provided by the procurer in the RFQ shall include,
(i) Definition of Procurer’s requirements, including:
Quantum of electricity proposed to be bought in MW. To provide flexibility to the
bidders, this may be specified as a range, within which bids would be accepted.
Further, the procurer may also provide the bidders the flexibility to bid for a part of the
tendered quantity, subject to a given minimum quantity.
The procurer may separately specify distinct baseload requirements and peakload
requirements through the same bid process. Seasonal power requirements, if any, shall
also be specified;
Term of contract proposed; (as far as possible, it is advisable to go for contract
coinciding with life of the project in case of long term procurement). The bidder shall
311
be required to quote tariff structure for expected life of the project depending upon fuel
proposed by him. The expected life project is estimated to be 15 years for gas/liquid
fuel based projects, 25 years for coal based projects and 35 years for hydro projects.
Normative availability requirement to be met by seller (separately for peak and offpeak hours, if necessary);
Definition of peak and off-peak hours;
Expected date of commencement of supply;
Point(s) where electricity is to be delivered;
Wherever applicable, the procurer may require construction milestones to be
specified by the bidders;
Financial requirements to be met by bidders including, minimum net-worth,
revenues, etc with necessary proof of the same, as outlined in the bid documents;
(ii) Model PPA proposed to be entered into with the seller of electricity. The
PPA shall include necessary details on:
Risk allocation between parties;
Technical requirements on minimum load conditions;
Assured offtake levels;
Force majeure clauses as per industry standards;
Lead times for scheduling of power;
Default conditions and cure thereof, and penalties;
Payment security proposed to be offered by the procurer.
(iii) Period of validity of offer of bidder;
(iv) Requirement of transfer of assets by the selected bidder (if any) to the
procurer at the end of the term of the PPA.
(v) Other technical, operational and safety criteria to be met by bidder,
including the provisions of the IEGC/State Grid Code, relevant orders of the
Appropriate Commission (e.g – the ABT Order of the CERC), emission norms,
etc., as applicable.
(vi) The procurer may, at his option, require demonstration of financial
commitments from lenders at the time of submission of the bids. This would
accelerate the process of financial closure and delivery of electricity;
(vii) The procurer and the supplier may exercise exit option subject to the
condition that the new player satisfies all RFP conditions.
5.5. RFP shall be issued to all bidders who have qualified at the RFQ stage. In
case the bidders seek any deviations and procurer finds that deviations are
reasonable, the procurer shall obtain approval of the Appropriate Commission
before agreeing to deviation. The clarification/revised-bidding document shall
be distributed to all who had sought the RFQ document informing about the
312
deviations and clarifications. Wherever revised bidding documents are issued,
the procurer shall provide bidders at least two months after issue of such
documents for submission of bids.
5.6. Standard documentation to be provided by the procurer in the RFP shall
include,
(i) Structure of tariff to be detailed by bidders;
(ii) PPA proposed to be entered with the selected bidder.
The model PPA proposed in the RFQ stage may be amended based on the inputs
received from the interested parties, and shall be provided to all parties responding to
the RFP. No further amendments shall be carried out beyond the RFP stage;
(iii) Payment security to be made available by the procurer.
The payment security indicated in the RFQ stage could be modified based on feedback
received in the RFQ stage. However no further amendment to payment security would
be permissible beyond the RFP stage.
(iv) Bid evaluation methodology to be adopted by the procurer including the
discount rates for evaluating the bids.
The bids shall be evaluated for the composite levellised tariffs combining the capacity
and energy components of the tariff quoted by the bidder. In case of assorted enquiry
for procurement of base load, peak load and seasonal power, the bid evaluation for
each type of requirement shall be carried out separately. The capacity component of
tariffs may feature separate non-escalable (fixed) and escalable (indexed) components.
The index to be adopted for escalation of the escalable component shall be specified in
the RFP. For the purpose of bid evaluation, median escalation rate of the relevant fuel
index in the international market for the last 30 years for coal and 15 years for gas /
LNG (as per CERC’s notification in (vi) below) shall be used for escalating the energy
charge quoted by the bidder. However this shall not apply for cases where the bidder
quotes firm energy charges for each of the years of proposed supply, and in such case
the energy charges proposed by the bidder shall be adopted for bid evaluation. The rate
for discounting the combination of fixed and variable charges for computing the
levellised tariff shall be the prevailing rate for 10 year GoI securities;
(v) The RFP shall provide the maximum period within which the selected bidder must
commence supplies after the PPA is entered into by the procurer with the selected
bidder, subject to the obligations of the procurer being met. This shall ordinarily not
be less than four years from the date of signing of the PPA with the selected bidder in
case supply is called for long term procurement. The RFP shall also specify the
313
liquidated damages that would apply in event of delay in supplies.
(vi) Following shall be notified and updated by the CERC every six months for the
purpose of bid evaluation:
1. Applicable discount rate
2. Escalation rate for coal
3. Escalation rate for gas /LNG
4. Inflation rate to be applied to indexed capacity charge component.
Bid submission and evaluation
5.7. To ensure competitiveness, the minimum number of qualified bidders should be at
least two other than any affiliate company or companies of the procurer. If the number
of qualified bidders responding to the RFQ/RFP is less than two, and procurer still
wants to continue with the bidding process, the same may be done with the consent of
the Appropriate Commission.
5.8. Formation of consortium by bidders shall be permitted. In such cases the
consortium shall identify a lead member and all correspondence for the bid process
shall be done through the lead member. The procurer may specify technical and
financial criteria, and lock in requirements for the lead member of the consortium, if
required.
5.9. The procurer shall constitute a committee for evaluation of the bids with at least
one member external to the procurer’s organisation and affiliates. The external
member shall have expertise in financial matters / bid evaluation. The procurer shall
reveal past associations with the external member - directly or through its affiliates that could create potential conflict of interest.
5.10. Eligible bidders shall be required to submit separate technical and price bids.
Bidders shall also be required to furnish necessary bid-guarantee along with the bids.
Adequate and reasonable bid-guarantee shall be called for to eliminate non-serious
bids. The bids shall be opened in public and representatives of bidders desiring to
participate shall be allowed to remain present.
5.11. The technical bids shall be scored to ensure that the bids submitted meet
minimum eligibility criteria set out in the RFP documents on all technical evaluation
parameters. Only the bids that meet all elements of the minimum technical criteria set
out in the RFP shall be considered for further evaluation on the price bids.
5.12. The price bid shall be rejected if it contains any deviation from the tender
conditions for submission of price bids.
5.13. Wherever applicable, the price bid shall also specify the terminal value payable
by the Procurer for the transfer of assets by the selected bidder in accordance with the
terms of the RFP.
314
5.14. The bidder may quote the price of electricity at the generating station bus-bar
(net of auxiliaries), or at the interface point with the State transmission network. For
purposes of standardization in bid evaluation, the tariffs shall be compared at the
interface point of the generator/supplier with the State transmission network. In case
the bidder quotes his rate at the generating station bus-bar, normative transmission
charges for the regional/inter-regional network, if applicable, based on the prevailing
CERC orders shall be added to the price bid submitted. The charges for the State
transmission network shall be payable by the procurer, and shall not be a part of the
evaluation criteria.
5.15. The bidder who has quoted lowest levellised tariff as per evaluation procedure,
shall be considered for the award. The evaluation committee shall have the right to
reject all price bids if the rates quoted are not aligned to the prevailing market prices.
Deviation from process defined in the guidelines
5.16. In case there is any deviation from these guidelines, the same shall be subject to
approval by the Appropriate Commission. The Appropriate Commission shall approve
or require modification to the bid documents within a reasonable time not exceeding
90 days.
Arbitration
5.17. The procurer will establish an Amicable Dispute Resolution (ADR) mechanism
in accordance with the provisions of the Indian Arbitration and Conciliation Act, 1996.
The ADR shall be mandatory and time-bound to minimize disputes regarding the bid
process and the documentation thereof.
If the ADR fails to resolve the dispute, the same will be subject to jurisdiction of the
appropriate Regulatory Commission under the provisions of the Electricity Act 2003.
Time Table for Bid Process
5.18. A suggested time-table for the bid process is indicated below. The procurer may
give extended time-frame indicated herein based on the prevailing circumstances and
such alterations shall not be construed to be deviation from these guidelines.
Event
Publication of RFQ
Elapsed Time from Zero
date
Zero date
Submission of Responses of RFQ
60 days
Shortlisting based on responses and issuance of
RFP
90 days
Bid clarification, conferences etc
150 days
315
Final clarification and revision of RFP
180 days
Technical and price bid submission
360 days
Shortlisting of bidder and issue of LOI
390 days
Signing of Agreements
425 days
5.19 A suggested time-table for the Single stage bid process is indicated below. The
procurer may give extended time-frame indicated herein based on the prevailing
circumstances and such alterations shall not be construed to be deviation from these
guidelines.
Event
Elapsed Time from
Zero date
Zero date
Bid clarification, conferences etc. & revision of RFP
90 days
Technical and price bid submission
180 days
Short-listing of bidder and issue of LOI
210 days
Signing of Agreements
240 days
Publication of RFP
6. Contract award and conclusion
6.11. The PPA shall be signed with the selected bidder consequent to the
selection process in accordance with the terms and conditions as finalized in
the bid document before the RFP stage.
6.12. Consequent to the signing of the PPA between the parties, the evaluation
committee shall provide appropriate certification on adherence to these
guidelines and to the bid process established by the procurer.
6.13. The procurer shall make evaluation of bid public by indicating terms of
winning bid and anonymous comparison of all other bids. The procurer shall
also make public all contracts signed with the successful bidders.
6.14. The final PPA along with the certification by the evaluation committee
shall be forwarded to the Appropriate Commission for adoption of tariffs in
terms of Section 63 of the Act.
(Ajay Shankar)
Additional Secretary to the Government of India
316
MEGA POWER PROJECTS : REVISED POLICY GUIDELINES
The guidelines for setting up of mega power projects of capacity 1000 MW or more supplying
power to more than one State had been issued vide D.O. letter N. C.-286/95-IPC, dated 10th
November, 1995. After considering the experience of this policy, the policy has been recast and is
summarised below:
1.
Inter-state and Inter-regional mega power projects are proposed to be set up both in the public
and private sectors. In the public sector, the National Thermal Power Corporation (NTPC) and
Damodar Valley Corporation (DVC) would be setting up the following projects: Kahalgaon Stage II
(1500 MW), North Karanpura STPP(2000 MW), Barh STPP(2000 MW), Maithon Project (1000
MW) and Cheyyur (1500 MW). In addition, NTPC would be expanding the four gas based plants,
namely, Anta, Auriya, Kawas and Gandhar to an additional capacity of 1300 MW each.
The National Hydro-Electric Power Corporation(NHPC) would be taking up the following
Inter-state projects: Koel-Karo (710 MW), Chamera-II (300 MW), Teesta-V (510 MW), Koldam (800
MW)and Parvati (800 MW).
In the private sector, in addition to Inter-regional Hirma (6 x 660 MW) project in Orissa, the
following projects are also proposed to be taken up: Cuddalore (1000 MW) - based on a blend of
domestic and imported coal; Krishnapattanam (1500 MW) - based on a blend of domestic and
imported coal; Pipavav (2000 MW) - based on imported coal and Narmada ( 1000 MW, which could
be expanded to 2000 MW ), based on LNG. Two or three more projects based on LNG, may be
developed on the Western coast later.These fuel options can be revised based on feasibility and cost.
2.
The Standing Independent Group (SIG) which had been constituted by the Government of
India in November, 1997, to establish parameters for negotiation of large power generation projects
would initially be the apex body to oversee the implementation of the mega private power projects.
The principles of competitive bidding would be adhered to as far as possible, while obtaining tariff
offers.
3.
A Power Trading Company(PTC) would be established with majority equity participation by
Power Grid Corporation of India Ltd. (PGCIL), along with NTPC, Power Finance Corporation (PFC)
and other financial institutions. Concerned State Governments/State Electricity Boards (SEBs) would
also be co-opted, if found feasible. The PTC would purchase power from the identified private
projects and sell it to the identified State Electricity Boards. As power would be sold to the States,
the concurrence of the concerned State Governments would be taken. Security to the PTC would be
provided by means of a Letter of Credit and recourse to the State’s share of Central Plan Allocations
and other devolutions. However, PTC may also, if feasible, supply power directly to a ‘cluster’, like
licensees and industrial establishments. The setting up of PTC would enable mega-projects to
negotiate with one buyer only and would eliminate mega-projects risk regarding payments. Such
security would substantially bring down the tariff from such projects.
4.
A pre-condition would be that the beneficiary States should have constituted their Regulatory
Commissions with full powers to fix tariffs as envisaged in the Central Act. They would also have to
privatise distribution in the cities having a population of more than one million. Similar comforts
317
would be given to public sector projects; however, they would deal directly with the SEBs and not
through the PTC.
5.
The import of capital equipment would be free of customs duty for these projects. In order to
ensure that domestic bidders are not adversely affected, price preference of 15% would be given for
the projects under public sector, while deemed export benefits as per the EXIM policy would be given
to domestic bidders for projects both under public and private sector. The domestic bidders would be
allowed to quote in US Dollars or any other foreign currency of their choice. In addition, the incometax holiday regime would be continued with the provision that the tax holiday period of 10 years can
be claimed by a promoter in any block of 10 years, within the first 15 years. The State Governments
are requested to exempt supplies made to mega power plants from sales tax and local levies.
6.
All such measures and the economies of scale in mega projects would substantially bring
down tariffs from such identified mega projects to provide much needed relief to State Electricity
Boards from rising tariffs from generating stations, both in public and private sector. The policy
would also enable implementation of a policy where large projects are set up at viable pit head sites,
coastal locations and hydel source, thus eliminating the unnecessary movement of fuel by rail and
encouraging the setting up of national transmission grid. The tax concessions are necessary as these
projects would help in catalysing reforms which are crucial to the restoration of the financial health of
the State Electricity Boards and would also help to accelerate the establishment of systems that would
transfer power across states and regions.
7.
The projects would be offered to the developers only after all the clearances/land have been
obtained so that projects can start soon after they are granted to the most competitive bidder. The
environmental clearance would be given in two phases by the Ministry of Environment and Forest the site clearance being given initially. Initial project development expenses would be incurred by
designated Central Public Sector Undertaking which would be recouped from the successful
developers. PGCIL would be entrusted with developing the required transmission network. Since the
transmission network would depend upon the identification of the beneficiary States, PGCIL would
identify the schemes and the corresponding costs of these transmission schemes. It would interact
with the beneficiary states to identify the requisite investment required in transmission and
distribution on the states side to absorb the power generated by the mega project.
8.
It is visualised that the country would be adding 15,000-20,000 MW of capacity through this
policy at the most competitive tariffs payable by State Electricity Boards and consequently by
consumers.
CAPTIVE GENERATION
The liberal provision in the Electricity Act, 2003 with respect to setting up of captive power plant has
been made with a view to not only securing reliable, quality and cost effective power but also to
facilitate creation of employment opportunities through speedy and efficient growth of industry.
318
The provision relating to captive power plants to be set up by group of consumers is primarily aimed
at enabling small and medium industries or other consumers that may not individually be in a position
to set up plant of optimal size in a cost effective manner. It needs to be noted that efficient expansion
of small and medium industries across the country would lead to creation of enormous employment
opportunities.
A large number of captive and standby generating stations in India have surplus capacity that could
be supplied to the grid continuously or during certain time periods. These plants offer a sizeable and
potentially competitive capacity that could be harnessed for meeting demand for power. Under the
Act, captive generators have access to licensees and would get access to consumers who are allowed
open access. Grid inter0connections for captive generators shall be facilitated as per Section 30 of the
Act. This should be done on priority basis to enable captive generation to become available as
distributed generation along the grid. Appropriate commercial arrangements would need to be
instituted between licensees and the captive generators for harnessing of spare capacity energy from
captive power plants. The appropriate Regulatory Commission shall exercise regulatory oversight on
such commercial arrangements between captive generators and licensees and determine tariffs when a
licensee is the off-taker of power from captive plant.
‘Captive generating plant’ means a power plant set up by any person to generate electricity
primarily for his own use and includes a power plant set up by any cooperative society or association
of person for generating electricity primarily for use of members of such cooperative society or
association.
Captive Generation has been freely permitted. The Electricity Act, 2003 does away with the
requirement of approval / clearance of any authority (SEB/CEA) for setting up of captive generating
plant. The new law also ensures non-discriminatory open access for transmission of electricity
generated from a captive generating plant to the destination of its use, subject to availability of
transmission capacity and have to pay transmission charges and exempt from payment of surcharge.
Any person setting up a captive power plant can also establish and maintain dedicated transmission
lines.
‘Cogeneration’ means a process viz. simultaneously produces 2 or more forms of useful energy
(including electricity).
319
EXTRACTS OF NOTIFICATION ISSUED BY DEPARTMENT OF REVENUE AS ON
1.3.2003
(B) Accessories of the medical equipment at
(A) above;
(C) Parts required for the manufacture, and
spare parts required for the maintenance, of the
medical equipment at (A) above;
(D) Continuous Ambulatory Peritoneal
Dialysis (CAPD) Fluid contained in a solution
bag with or without tubing system;
(E) Accessories of (D) above;
5%
5%
Nil 11
5%
- -
5%
- -
(F) Parts required for the manufacture of (D) 5%
above
(cxi)
-
-
Nil 11";
against S.No.364, (a)
for the entry in column (4), the entry “5%” shall be substituted; and
(b)
for the entry in column (5), the entry “-” shall be substituted;
(cxii) against S.No.367, for the entry in column (5), occurring against item (A), the entry “-” shall be
substituted;
(cxiii) against S.No.368, for each of the entry in column (5), occurring against items (A) and (B), the
entry “-” shall be substituted;
(cxiv) against S.No.369, for the entry in column (5), the entry “-” shall be substituted;
(cxv) against S.No.371,(a)
for the entry in column (2), the entry “90 or 9804 90 00" shall be substituted;
and
(b)
for the entry in column (4), the entry “5%” shall be substituted;
(cxvi) against S.No.373,(a)
for the entry in column (4), the entry “5%” shall be substituted; and
(b)
for the entry in column (6), the entry “-” shall be substituted;
(cxvii) against S.No.375,(a)
for the entry in column (2), the entry “9001 10 00" shall be substituted; and
(b)
for the entry in column (4), the entry “20%” shall be substituted;
(cxviii) against S.No.376, for the entry in column (2), the entry “9006 91 00" shall be
substituted.
(cxix) against S.No.377, for the entry in column (2), the entry “9007, 9009 91 00,9009 92 00,9009
93 00,9009 99 00,9010 10 00,9010 50 00 or 9010 90 00" shall be substituted;
320
(cxx) against S.No.380, for the entry in column (2), the entry “9017 10 00 or 9017 20" shall be
substituted;
(cxxi) against S.No.381, for the entry in column (2), the entry “9017 90 00" shall be substituted;
(cxxii) against S.No.385, for the entry in column (4), the entry “Nil” shall be substituted;
(cxxiii)against S.No.387, the entries in columns (2) to (6) shall be omitted;
(cxxiv)against S.No.388, for the entry in column (2), the entry “91 or 9804 90 00" shall be
substituted;
(cxxv) against S.No.394, for the entry in column (2), the entry “9503 10 00 and 9503 90" shall be
substituted;
(cxxvi)against S.No.398, for the entry in column (2), the entry “9706 00 00" shall be substituted;
(cxxvii)for S.No.400 and the entries relating thereto, the following shall be substituted, namely:-
(1)
(2)
“400.
9801
(3)
(4)
(5)
(6)
Goods required for setting up of
any Mega Power Project, that is
to say (a) an inter-State thermal power
plant of a capacity of 1000 MW
or more; or
(b) an inter-State hydel power
plant of a capacity of 500 MW
or more,”
Nil
Nil
86";
as certified by an officer not below
the rank of a Joint Secretary to the
Government of India in the Ministry
of Power.
(cxxviii)against S.Nos. 402, 410, 411, 412, 413 and 414, the entries in columns (2) to (6) shall be
omitted;
(cxxix) against S.No.415, for the entry in column (2), the entry “7320 90 90, 8445, 8448 20 00,
8483 90 00, 8484 90 00 or 8485 90 00" shall be substituted;
321
RESERVE BANK OF INDIA
PRESS RELEASE
PRESS RELATIONS DIVISIONS, CENTRAL OFFICE, POST
BOX 406, BOMBAY 400023 GRAM RESERVE BANK
PHONE 2360502
100% Foreign Investment in Privately Owned Power Sector
Government of India in their Gazette Notification No. 237 dated 22nd October 1991 have notified that
foreign investment to the extent of 100% will be permitted in the power sector in privately owned
enterprises. It has since been clarified by the Ministry of Finance that the condition of dividend
balancing by export earnings which is normally being applied to cases of foreign investment upto
51% equity will not be applicable to such foreign investments in the power sector.
Press Release 1991-1992/266
322
GOVERNMENT OF INDIA
Ministry of Commerce & Industry
Department of Industrial Policy & Promotion
SIA (FC DIVISION)
PRESS NOTE NO. 7 (2000 Series)
Subject: Review of existing sectoral policy and sectoral equity cap for Foreign Direct
Investment (FDI)/Non Resident Indian (NRI)/Overseas Corporate Bodies (OCB)
Investment.
In pursuance of Government’s Commitment to further liberalising the FDI regime,
Government, on review of the policy on FDI, has decided to bring about the following changes
in the FDI policy.
I. Foreign Direct Investment upto 100% is allowed for e-commerce activities subject to
the condition that such companies would divest 26% of their equity in favor of the
Indian public in 5 years, if these companies are listed in other parts of the world.
Further, these companies would engage only in business to business (B2B) e-commerce
and not in retail trading, inter alia, implying that existing restrictions on FDI domestic
trading would be applicable to e-commerce as well.
II. Vide Press Note No. 12 of 1992 series, it had been decided to withdraw the condition of
dividend balancing in all foreign investment approvals except for industries in the 22
specified consumer goods sector. On review of the existing policy on dividend
balancing applicable to 22 specified consumer goods industries, and with a view to
attracting FDI, it has been decided, with immediate effect, to remove the condition of
dividend balancing on these 22 consumer goods industries. This decision will come into
force from the date of issue of this Press Note and the export obligation and
concomitant dividend balancing will remain applicable until the date of issue of this
Press Note.
III. Under Press Note No.2 of 1998 series, projects for electricity generation, transmission
and distribution with foreign equity upto 100% had been made eligible for automatic
approval provided the foreign equity in any such project does not exceed Rs.1500 crore.
The categories that qualified for such automatic approval are hydroelectric power
plants, coal/lignite based thermal power plants, oil based thermal power plants and gas
based thermal power plants. Generation, transmission and distribution of electrical
energy produced in atomic reactor power plants is not legible for automatic approval.
Keeping in view the growing demand for power in the country and the need for more
investment in this sector, Government, as part of further liberalization of FDI regime,
has decided to remove the upper limit for foreign direct investment in respect of
projects relating to electric generation, transmission and distribution (other than atomic
reactor power plants).
IV. As per existing guidelines for FDI in petroleum sector, FDI in refining is permitted upto
26% (public sector holding of 26% and balance 48% by public). In case of private
323
Indian companies, FDI in refining is permitted upto 49%. Government, as part of
liberation of FDI regime has decided to increase the level of FDI in oil refining sector
under automatic route from the existing 49 % to 100%
(M.S. SRINIVASAN)
Joint Secretary to the Government of India
No.7(4)/2000-IP dated 14th July 2000.
324
I.
Contact Addresses of Ministry of Power
Designation
Name
Telephone/ Fax
Minister of Power
Shri P.M. Sayeed
Tel: 2371-7474, 2371-0411
Fax: 2371-0065
PS to MOP
Shri Z.A. Naqvi
Tel: 2371-0411
Fax: 2371-0065
OSD to MOP
Shri P.C. Tanwar
Tel: 2371-7474
Fax: 2371-0065
Secretary(Power)
Shri R.V. Shahi
Tel: 2371-1316, 2371-0271
Fax: 2372-1487
Special Secretary
Shri D.N.Padhi
Hydel, Transmission, OM, IPC,
T&R, Administration
Tel: 2371-4367
Fax: 2373-1266
Additional Secretary
Policy & Planning, SEBs,
Shri Ajay Shankar
External Assistance, Vigilance &
Security, REC, PFC, Reforms &
Restructuring, OL
Telefax: 2371-5378
325
Joint Secretaries
Financial Adviser
Shri M.Sahoo
Tel: 2371-0171
Administration, Thermal,
OM & OL
Shri Harish Chandra
Tel: 2371-0389
Distribution, Thermal,
APDRP, IT & REST
Shri Arvind Jadhav
Telefax: 2371-4842
Hydel, Investment
Promotion Cell, OM,
Coordination and Press &
Publicity
Shri A.K. Kutty
Telefax: 2371-0199
Transmission, EC & EE,
T&R, Power Trading
Shri Gireesh B. Pradhan Tel: 2371-4009
Directors
Reforms & Restructuring, V&S,
Shri Alok Kumar
IC & RE
Tel: 2371-4000
Policy & Planning, PFC
Shri Sudhakar Shukla
Tel. 2371-7753
IPC & Hydel-II
Shri Sanjay Chadha
Tel: 2371-5327
Thermal
Shri Ashwini Kapoor
Tel: 2371-1394
Transmission, General,
Cash, Admin-III, Library,
Parliament
Shri D.C. Srivastava
Tel: 2371-5250
Hydel-I
Shri R. Verma
Tel: 2371-1302
OM
Shri A.K. Saxena
Tel: 2371-6674
326
Deputy Secretaries
Finance
Shri Saurabh Kumar
Tel: 2371-7196
Coordination
Shri Chandan Singh
Tel: 2371-5595
T&R
Ms. Bina Prasad
Tel: 2375-2496
Thermal-I
Shri K.K.Chugh
Tel. 2375-2497
Administration-I,II & III
Shri O.S. Narula
Tel.2371-4100
Grievance
Smt. Nirmal Rao
Tel: 23714168
O.L.
Ms. Asha Nayyar
23752495
I.T.
Smt. Dharitri Panda
23716020
327
Contacts – State Electricity Regulatory Commissions
Telephone No.
Name and designation
Code
Fax
Office
Res.
Shri N. Barua,Chairman, Assam
Electricity Regulatory
Commission.A-12/334, Housing
Complex, Tripura Road,
Khannapara,
Guwati- 781 022.
0361
541090
265730
Shri G.P.Rao, Chairman, Andhra
Pradesh Electricity Regulatory
Commission
No.8-2-283/B/1, Road No.3
Banjara Hills, Hyderabad 500
034
040
3542688
3542519
Shri V.K. Sood, Chairman,
Delhi Electricity Regulatory
Commission,Vinayak Bhavan,
Shivalik, Malviya Nagar, New
Delhi – 17.
011
Justice S.D.Dave. Chairman,
Gujarat Electricity Regulatory
Commission, Vth Floor, Centre
Point, Panchavati, ellisbridge,
Ahmedabad – 380 006
079
6584542
6584684
Shri S. S. Gupta, Chairman,
Himachal Pradesh Electricity
Regulatory Commission,
Keonthal Commercial Complex,
Khalini, Shimla - 171002
0177
227162
227262
Shir K.S. Chaube, Chairman,
Haryana Electricty Regulatory
Commission, SCO-180, Sector5, Panchkulla- 134 109
172
572359
572996
26673608
3356640
26868173
26673602
(Telefax)
26514049
582581
328
The Chairman, Jaharkhand State
Electricty Regulatory
Commission, 2nd Floor, Rajendra
Jawan Bhawan-cum- Sainik
Bazar, Main Road, Ranchi 834001
2330923
2330922
2330924
0651
The Chairman, Kerala
Electricty Regulatory
Commission, Thiruvanthapuram
Shri Phillipoose Mathai,
Chairmain
Karnataka Electricity Regulatory
Commission, No.9/2,
Mahalaxami Chambers, 6th & 7th
Floor, M.G. Road, Bangalore –
560 001
Shri P.K Mehrotra, Chairmain
Madhya Pradesh Electricity
Regulatory Commission, Urja
Bhawan, Shivaji Nagar, Bhopal 462016
Shri P.Subramanyam, Chairmain
Maharashtra Electricity
Regulatory Commission, World
Trade Center, Center No. 1, 13th
Floor, Cuffee Parade, Colamba,
Mumbai - 400005.
080
5320336/38
5320356
3536863
557819
0755
766851
2163976
022
Shi O.C.Sahoo, Chairman,Orissa
Electricty Regulatory
Commission, Bidyut Niyamak
Bhawan, Unit-VIII,
Bhubaneshwar-751012.
0674
Shri R.S. Mann, Chairman,
Pubjab State Electricity,
Regulatory Commission, 517,
Sector 33B, Chandigarh.
0172
984500189
2 (M)
291999
2163960
982123476
1(M)
3670555/155
5
413306
418233
531656
664758
549362
419781
668002
329
Shri Arun Kumar, Chairman,
Rajasthan Commission, Shed No.
5, Vidyut Bhawan, Vidyut Marg,
Jyoti Nagar,Jaipur-302005.
0141
Thiru A. Balraj, Chairman, Tamil
Nadu Electricity Regulatory
Commission, Vetha Manssion,
No. 17, 3rd Road, Seetammal
Colony, Alwarpet, Chennai600018,
044
740067
561324
4354930
4818124
4354982
4322037
210051
Shri J.L. Bajaj, Chairman, Uttar
Pradesh Electricity Regulatory
Commission, Kisan Mandi, 2nd
Floor, Lucknow -226010.
0522
Shri Satyendra Nath Ghosh,
Chairman, West Bengal
Electricity Regulatory
Commission, Flat No. 2&3,
Building No. B-5, FD 415A,
Poura Bhaban (3rd Floor), SectorIII, Bidhannagar, Calcutta 700091.
033
Shri Divakar Dev, Chariman,
Uttranchal Electricity Regulatory
Commission, 80 Vasant Vihar
(Phase-I), Dehradun.
0135
300292/358
300358/38
7
914512144
(Noida)
5933971
3593553
2162688
3599720
762106
9837059
520(M)
330
Contacts - Secretary (Power/Energy) States
Telephone No.
Name and designation
Code
Fax
Office
Res.
3455452
3453305
3391296
Shri V.S. Sampath,
Principal Secretary,
Energy Department Government
of Andhra Pradesh, Hyderabad
500 001
040
Shri Sumeet Jerath,
Commissioner (Power), Energy
Department,
Government of Assam,
Dispur 781 005
0361
260237
261312
Shri A.K.Upadhyay,
Principal Secretary, Energy
Department, Government of
Bihar, Patna 800 008
0612
225412
239652
236288
232852
231604
Shri A.K.Guha
Commissioner (PWD& Power),
Government of Arunachal
Pradesh, Itanagar 791 111
0360
212540
212523
215667
Shri Ajay Pal Singh,
Secretary( Energy ),
Government of Chattisharh, Raipur
0771
221145
331014
331017
221150
Shri Vijay Madan,
Development Commissioner,
Electricity Department, Govt. of
Goa,Panaji 403 001
0832
223196
222597
223995
3070765(D
el)
222597
225254
224070
Dr. (Ms) Manjula Subramaniam
Principal Secretary,
Energy & Petrochemical Deptt.,
Government of Gujarat,
079
3220072
3261487
09848053052
3548450
3455452
3453305
260900
3220198
331
Sachivayalay, Block No.5,
Gandhinagar 382 010
Shri Sudhir Prasad,
Secretary (WR&Energy), Government
of Jharkhand,
Nepal
House, Ranchi.
0651
252573
503012
242246
252573
Shri R.B.Budhiraja
Secretary, Energy Department,
Government of Maharashtra,
Bombay 400 001
022
2026767
09820044713
2047271
2029388
Shri K. Shankar Narayan
Principal Secretary, Govt. of
Madhya Pradesh, Energy Deptt.
Bhopal 462 001
0755
551463
551199
557308
559642
Shri P.B.O. Warjri
Principal Secretary
Government of Manipur,
Manipur Secretariat
Imphal 795 001
0385
220513
221781
222629
Shri C.D. Kynjing
Secretary, Energy Department,
Government of Meghalaya,
Shillong
0364
226424
223797
225978
Shri Haukhum Hauzel,
Secretary (Power)
Government of Mizoram,
Department of Power
Aizwal 796 001
0389
325653
340878
322776
Shri Banuo Z. Zamir,
Commissioner, PWD &
Electricity Department,
Government of Nagaland
Kohima 797 001
0370
270110
241854
221406
Ms. Meenakashi Anand
Chaudhary, Financial
Commissioner & Secretary
0172
740188
548620
745279
332
(Power),
Government of
Haryana,Chandigarh
Shri Kanver Shamsher Singh,
Chief Secretary, Department of
Power, Government of Himachal
Pradesh,
Shimla 171002
Shri Ajit Kumar,
Principal ecretary,
Power Department,
Government of Jammu &
Kashmir, New Secretariat,
Jammu 180 001
0177
221904
0191
0194
546206/54544
7(Jammu)
452236/45235
2 (Sri Nagar)
225941
430902
453883
221145
545447(Jam
mu)
452352 (Sri
Nagar)
Shri N.V. Madhavan,
Principal Secretary,
Government of Kerala,
Power Department, Secretariat,
Thiruvananthapuram 695 001
327803
0471
467177
327803
09847078111
Shri Ajay Srivastava,
Comm-cum-Secretary,
Power Department,
Government of Tripura,
Agartala 799 001
0381
375119
353705
Shri D.N. Padhi,
Secretary, Department of Power,
Government of Orissa,
Bhubaneswar 751 001
0674
536960
406605
530205
403175
412130
Shri C.S. Rajan
Secretary, (Mines & Energy),
Government of Rajasthan,Jaipur
302 001
0141
380635
380222
511342
380635
23103
22927
Shri P.P. Kharel
Secretary, Department of Power,
Government of Sikkim, Gangtok
– 737101
22244
22510
03592
22908
333
22916
Shri K.P Pandey,
Principal Secretary,
Energy Department,
Government of
Karnataka,Sachivalaya-II,
Bangalore 560 001
080
2252373
2092561
8460224
2260256
Shri Anil Kumar,
Principal Secretary (Energy),
Government of Uttar Pradesh,
Power Department,104 Bapu
Bhawan
Lucknow – 226001
0522
237357
238761
239328
Shri Keshav Desiraju,
Secretary(Energy), Government of
Uttaranchal Secretariat, Dehradun 248001,
0135
712074
712050
Shri R.Rathinasamy,
Secretary, Department of Power,
Government of Tamil Nadu,
Secretariat Fort St. George
Madras 600 009
044
6248361
5361496
Shri Sudhir Mittal,
Secretary (Power)
Government of Punjab
I&P Department
Chandigarh
0172
540698
743587
Shri K.K.Bagchi
Pr. Secretary, Power Department, Govt.
of West Bengal,
1, K.S. Roy Road,
Calcutta - 700 001.
033
2481267
2404161
2214961
Shri V.K. Singh
Commissioner & Secretary,
Department of Power, Andaman
& Nicobar Admn,
Port Blair 744 101
03192
33205
Shri Prashant Goyal,
Principal Secretary (P),
0413
712066
9837043676
5361496
742920
743587
334448
33181
254941
337575
334
Department of Power
Chief Secretariat,
Pondicherry 60500
338724
Shri R.V. Verma,
Secretary (Power)
U.T. Lakshadweep
Kavaratii via Cochin 682 555
04896
62278
62385
62140
Shri Ramesh Chandra,
Principal Secretary( Power),
Government of NCT of Delhi,
Vikas Bhavan, New Delhi
011
3392131
3387534
3392070
Shri Rakesh Singh,
Adviser to Administrator &
Secretary (Power),
UT of Chandigarh, Defence
Building, Sector 9D,
Room No.412, U.T. Secretariat
Chandigarh.
0172
742001
549003
742007
549005
335
List of Chairman, State Electricity Boards
Telephone
S.N
Name & Address
Code
Office
Res.
3391174
3317643
3702571
Fax
1.
Shri J. Parthasarthy
CMD, Andhra Pradesh Power
Generation Company, Vidyut
Soudha, Hyderabad 500 049
2.
Shri P.Ramakant Reddy,
CMD, Andhra Pradesh Power
Transmission Company, Vidyut
Soudha, Hyderabad 500 049
040
3.
Shri R.Hussain
Chairman, Assam State Electricity
Board, Bijulee Bhavan, Paltan
Bazar, Guwahati-781001
0361
540311
541088
4.
Shri N.K.Aggarwal
Chairman, Bihar State Electricity
Board, Vidyut Bhawan, Bailey
Road, Patna 800 001
0612
224534
205036
286635
222968
5.
Shri Gopal Tiwari
Chairman, Chattisgarh State Electricity
Board,
D.K. Bhawan Raipur
0771
244902
283141
66900
6.
Shri Nalinbhai Bhatt
Chairman, Gujarat Electricity
Board, Vudyut Bhawan, Race
Course, Baroda 390 007
0265
338299
040
3317663
3317657
3320565
3396000
454927
541090
340220
330617
338164
336
7.
Shri. G.I.Bhagat
Managing Director, Gujarat Industries
Power Company Limited. Baroda
8.
Shri P.K.Tanejat
Managing Director, Gujarat State
Electricity Corpn., Vudyut Bhawan, Race
Course, Vadodara - 390 007
9.
Shri Sanjay Gupta
Managing Director, Gujarat State Energy
Generation Limited, Block 15, 3rd Floor,
Udyog Bhawan, Sector 11, Ghandinagar
382011
0265
373175
370028
0265
335615
355193-95
098240341
33
338847
02712
36371
36372
37372
20338
098249809
31
36375
10.
Shri Sameer Mathur,
MD, Haryana Vidyut Prasaran
Nigam Ltd, Shakti Bhavan, Sector
VI, Panchkula 134 109
0172
561931
560579
560652
744070
11.
Shri Uma Shanker,
Dakshin Haryana Bijlee Vitran
Nigam Ltd., Vidyut Nagar,
Hissar, Haryana
01662
21724
76363
12.
Shri S.K. Monga,
MD, Haryana Power Generation
Corporation, Panchkula
0172
560672
13.
Shri Kanwer Shamsher Singh, Secretary &
Chairman,
Himachal Pradesh State Electricity Board,
Vidyut Bhawan,
Shimla 171002
0177
221904
225941
221145
14.
Shri Rajiv Ranjan,
Chairman,
Jharkhand State Electricity Board,
Engineering Building, HEC, Dhurwa,
Ranchi – 834004
0651
403807
403809
2040738
403799
560640
565746
560136
337
15.
Shri S.K. Dasgupta,
Chairman,
Madhya Pradesh Electricity Board, P.O.
Box No. 34, Rampur, Jabalpur 482 008
0761
16.
Shri Vimal Bansal,
Chairman, Maharashtra State
Electricity Board, Prakashgad, 4th
floor, Bandra (East)
Bombay 400 051
17.
Shri B.G. Kharkongor,
Chairman, Meghalaya State
Electricity Board, Short Round
Road, Shillong 793 001
0364
18.
Shri P. Patnaik,
Chairman & MD
Grid Corporation of Orissa
Vidyut Bhawan Janpat,
Bhubaneswar 751 001
0674
19.
Shri Sudhir Mittal
Chairman, Punjab State Electricity
Board.
The Mall, Patiala 147 001
022
663251
661565
663850
663851
661565
2025393
09820131
764
2040738
2025393
226345
226345
226294
226367
0175
661696
540098
451196
222074
530663
541904
212005
743587
214927
20.
Shri D.C. Samant,
CMD, Rajasthan Vidyut Prasaran Nigam
Ltd., Jaipur 137001
0141
740118
212419
21.
Shri R.K. Gupta,
CMD, Rajasthan Rajya Vidyut Utpadan
Nigam Ltd., Vidyut Bhawan, R.C. Dave
Marg,
Jaipur - 302005
0141
740381
218050
740633
338
22.
23.
24.
25.
26.
27.
Shri C.S. Ranjan,
CMD, Rajasthan State Power
Corporation Ltd., E-166,
Yudhisthar Marg, C-Scheme,
Jaipur 137001
0141
Shri V.P. Baligar, IAS,
Chairman & MD, Karnataka Power
Transmission Corporation Ltd.,
Vauvery Bhawan,
Bangalore –
560009
080
Shri K. Jothiramalingam,
Managing Director, Karnataka Power
Generation Corporation Ltd., Shakti
Bhawan, 82, Race Course Road, Bangalore
- 560001
080
384055
382759
384077
382298
2214342
2244556
381825
6783232
2210728
6686169
2202811
2204153
2255606
Shri T.M. Manoharan,
Chairman, Kerala State Electricity
Board, Vidyut Bhawan, Patom,
Trivandrum 695 004
0471
Shri K. Gnanadesikan,
Chairman, Tamil Nadu Electricity
Board, 800 NPKR Ramaswamy
Maligai
Anna Salai,Madras 600 002
044
Shri R.K. Narayan, Chairman
U.P. State Electricity board, Shakti
Bhavan, 14,. Ashok Marg,
Lucknow 226 001
0522
441328
448128
442125
333704
333406
8521300
8522300
6258039
8544528
206206
280237
211169
287792
287827
448246
Shri
28.
UP
Hydro Power Corporation,
Vikas Deep, Station Road, Lucknow
0522
230604
280215
635276
339
29.
Shri Ranbir Singh,
Chairman & MD, UP Vidyut Utpadan
Nigam, Shakti Bhawan, Lucknow
0522
280207
.
30.
Dr.G.D.Gautam
Chairman, West Bengal State
Electricity Board, Bidyut Bhavan,
Salt Lake Block No.DJ, Sector-II,
Calcutta 700 091
033
3591915
3592723
31.
Shri Jagdish Sagar, IAS
Chairman, Delhi Vidyut Board,
Shakti Bhawan, Nehru Place, New
Delhi – 110019
376101
2472036
3373002
2406740
6460941
011
6484802
6484833
6822136
6460942
6410802
Shri D.N. Padhi,
32.
Chairman &
MD,
Orissa Hydro Power Corporation
Ltd.,
Janpath, Bhubaneswar
751001
0674
542922
530205
403175
340
List of CMD's of Central Power Sector Units
Telephone
S.N
1.
Name & Address
Sh. C.P. Jain
Chairman & Managing Director
National
Thermal Power Corporation,
Code
011
Office
Res.
24360044
24361199
26014357
Fax
24363050
CORE-8, Scope Complex,
NEW DELHI
Sh. R.P. Singh ,
Chairman&Managing Director,
Powergrid Corporation of India
Ltd., B-9, Qutab Institutional
Area, Katwaria Sarai,
NEWDELHI
011
3.
Sh.A.K.Gangopadhayay
,
Chairman & Managing Director,
National Hydro-Electric Power
Corporation Ltd., NHPC Office
Complex, Sector-33,
FARIDABAD
0129
951292275920
9512926274633
4.
Shri R.K.Sharma,
Chairperson & Managing
Director, Rural Electrification
Corporation, CORE-4, Scope
Complex, NEW DELHI
011
24361562
24361851
26887806
24366948
5.
Shri R.Krishnamurthy,
Chairman & Managing Director,
Power Finance Corporation Ltd.,
Chandralok Building,
36, Janpath,
NEW DELHI-110001
011
23315824
23356157
23231103
23717308
2.
26560072
26890075
26560054
26560075
341
6.
Shri M. L. Gupta,
Chairman & Managing Director,
Tehri Hydro Development Corpn.
Ltd., A-10, Sec.1, (KRIBHCO
Bhawan), NOIDA-201301
0120
2536071
2506810
7.
Sh.H.K.Sharma,
Chairman & Managing Director,
SJVNL, Himfed Building,
NEW SHIMLA - 171009
0177
2270804
2224979
8.
Sh. S.C. Sharma,
Chairman & Managing Director,
North-Eastern Electric Power
Corporation Ltd.,
Brookland
Compound, Lower New Colony,
Shilong –793003
0364
2224487
2226453
2224259
0172
2548542
10.
Sh. R.K.Singh,
Chairperson,
Damodar Valley Corporation
(DVC), DVC Towers, VIP Road,
CALCUTTA-700054
033
23557935
24753356
11.
Sh. T.N. Thakur, Chairman &
Managing Director,
Power Trading Corporation,
NBCC Building, Third Floor,
Bhikaji Cama Place, New Delhi
011
26431783
26871485
Sh. Rakesh Nath,
9.
Chairman ,
Bhakra Beas Management Board
(BBMB),
Madhya Marg,
Sector-19-B,
CHANDIGARH
2549857
342
CENTRAL ELECTRICITY REGULATORY COMMISSION
Address:
Central Electricity Regulatory Commission, Core-3, 5th Floor, SCOPE
Complex, 7, Institutional Area, Lodhi Road, New Delhi – 110 003.
Phone: 91-11-24364895
Fax:
91-11-24360010 / 24360058
E-mail:cerc@cercind.org
Website:
http://www.cercind.org
Members:
1.
Sh. A.K.Basu, Chairman
-
Tel: 2436 0004
2.
Sh. K.N.Sinha, Member
-
Tel: 2436 1280
3.
Sh. Bhanu Bhushan, Member
-
Tel: 2436 1259
4.
Sh.A.H.Jung, Member
-
Tel: 2436 1235
343
