The Hindu : Business : Power reforms should focus on quality: Sayeed

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Wednesday, Nov 24, 2004

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Power reforms should focus on quality: Sayeed

By Our Special Correspondent

NEW DELHI, NOV. 23. The Union Minister for Power, P. M. Sayeed, today said power sector reforms should focus more on elimination of inefficiencies in the system and wastage in the entire value chain rather than emphasising on tariff increases.

Addressing a conference of the Central Electricity Regulatory Commission (CERC) and 22 State regulatory commissions here, the Minister said quality of electricity service was low and people were tolerating it only because tariffs were low. There were indications that if there was a perceptible improvement in the quality of service, higher user charges would be more acceptable, he said.

Mr. Sayeed pointed out that several State power utilities were showing signs of turning the corner but the overall health of the distribution segment continued to be a matter of concern. Therefore, distribution reforms should be pursued with full vigour so that the State electricity boards and their successor entities could become viable institutions. The Minister said regulatory commissions had to perform executive functions as well as a developmental role because of which a formal and rigid judicial approach in the regulatory process being followed in certain countries need not be emulated by India. He also assured the regulators that the Central Government was fully committed towards providing full autonomy to regulatory commissions so that they could operate on professional lines.

At the meeting, the Chairman CERC, Ashok Basu, made a presentation to the Minister, apprising him of the various initiatives taken by the Central and State regulatory commissions to implement various positions of the Electricity Act, 2003. During the interaction that followed, several State regulators said they were not getting necessary administrative and infrastructure support from their respective State Governments. Funds were not appropriately allocated for running the commissions, staff was inadequate and even policy directors were being issued on matters which were not in the domain of policy but of detail, they said.

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