15/11/2021 - Government Policies

KEY POINTS

·        Universal access to affordable, clean and modern energy is key to the wellbeing of a growing population besides enhancing industrial competitiveness.

·        The Electricity Amendments Bill 2021 aims to reinvigorate the sector while focusing on the 4 Cs customer, competition, compliance and climate.

·        The new Bill looks to tackle legacy issues responsible for this by proposing that retail tariffs be “cost-reflective”, i.e., should no longer incorporate subsidies, which states would pass onto customers via Direct Benefit Transfer (DBT).

·        The government has also proposed a progressive reduction in cross-subsidy surcharges which should reduce the cost of commercial power, thereby enhancing the competitiveness of domestic industries as we look to build an Atmanirbhar Bharat.

·        These reforms will also provide financial relief to the states burdened by discom resource crunch, while helping attract more investments due to reduced industrial tariff. DBT should ensure targeted subsidy, further easing the burden on states.

·        Another key area of focus is compliance as the Bill seeks to strengthen and streamline various regulatory bodies, for better governance and faster dispute resolution.

·        However, on ground implementation will be key and this will be possible only when the Centre actively engages with the states and takes them along in the true spirit of cooperative federalism. 

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