The Union Government is going to make major changes in the power sector. The draft of the new electricity bill has been finalized. It will be introduced in the winter session of Parliament starting November 29. Its direct impact on the country Millions of electricity customers Will fall on The first major change is that the government will no longer subsidize power companies, but will transfer them directly to customer accounts, such as subsidizing cooking gas.
Power companies, on the other hand, will charge customers in full. That means customers will get electricity at full price. The government will then transfer the subsidy to the customer’s account according to the slab. The biggest effect of this will be that the days of free electricity will come to an end. Because no government will be able to provide free electricity. However, it can subsidize customers. The biggest fear is that the government will continue to subsidize only the needy, as is the case with LPG. At present, all power consumers across the country get the benefit of subsidy as per slab. Through the new power law, the government can also ensure that only the needy get the benefit of subsidy.
Fear of high electricity prices: The new law will allow power companies to charge customers on a cost basis. At present the cost of power generation companies is Rs 0.47 per unit more than the bill charged from the customers. Companies compensate for this through subsidies. In other words, under the current scenario, after the new bill, electricity may become more expensive by Rs 0.47 per unit. So far the system is that the state governments give advance subsidy to the distributor power companies. Electricity rates are fixed on the basis of this subsidy. After the new law comes into force, the entire cost will be recovered from the customers. In return, the subsidy will be transferred to the accounts.
There are also some challenges in enforcing the new law:
1. Connection is in the name of landlord, land, shop owner. It is not clear who will get the subsidy if the customer is a tenant.
2. Subsidy will be fixed according to the consumption of electricity. This requires 100% metering. Electricity is being provided without meters in many states. There are 1.5 million agricultural customers in Maharashtra who are getting electricity without meters. They constitute 37% of the total agricultural customers.
3. If the subsidy transfer is delayed then the customer will be upset. According to PRS Legislative Research, the average monthly bill of an agricultural customer can be up to Rs 5,000. For those who are now getting free electricity, this amount will be huge.
The government had to bring this new law because:
1. Power distribution companies say that they are running at a huge loss. Its losses have crossed Rs 50,000 crore.
2. Companies owe Rs 95,000 crore on DISCOM. Discom is getting delays in getting subsidies, which is putting distribution companies in trouble.
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