The Hindu : New Delhi News : Government, DERC make a mess of it

Online edition of India's National Newspaper
Friday, Jul 08, 2005

New Delhi

New Delhi

Government, DERC make a mess of it

Sujay Mehdudia

Autonomous nature of the regulatory body under a cloud

NEW DELHI: The latest 10 per cent increase in power charges for domestic consumers and a somewhat similar hike for other consumers across the Capital come as no surprise. However, the manner in which the Delhi Government and the Delhi Electricity Regulatory Commission (DERC) have handled the issue leaves a lot to be desired putting under a cloud the autonomous nature of the regulatory body.

The hike comes after a go-ahead by the Congress high command and refusal by the Union Power Ministry to foot the subsidy bill for certain sections of consumers as demanded by the Delhi Government. What has been the most surprising part of the whole deal, according to observers, is the manner in which the Delhi Government and the DERC have conducted themselves during the last fortnight over the tariff hike issue.

Experts faulted the Delhi Government for approaching the Union Government to provide subsidy thereby violating the terms and conditions of the agreement that clearly outlines a 10 per cent hike for five consecutive years. Also there was a feeling that if the Union Power Ministry had to extend subsidy to the Delhi Government for lessening the impact of the power tariff hike then it would defeat the very exercise of privatisation and put a question mark over the success of reforms in the power sector in the Capital.

Similarly, observers are critical of the way the Delhi Government handled the issue. "If the Delhi Government was weary of an power tariff hike then it should have got into negotiations with the DERC well before the issue was to be decided. Just when the DERC was about the hike the tariff, the Chief Minister, Sheila Dikshit stepped in adding confusion to the scenario and only delaying the inevitable for political reasons,'' a senior official remarked.

The hike for domestic consumers has been around 10 per cent but the worst hit is the farming community that has been handed a 19 per cent increase in tariffs. The farmers had been given a raw deal during the recent water tariff hike as well.

The whole issue has also raised questions about the autonomous nature of the DERC and its overall functioning. The manner in which DERC members went about making amendments in the tariff order makes it clear that the Commission is at the beck and call of the Sheila Dikshit Government.

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