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Web Exclusive | October 2012

'Only performing discoms should get bailout package'

The Consumer Education and Research Centre (CERC) It want the Central government to give bailout package to only those state utilities that improve their performance. It disagrees with the Ministry of Power that want to increase electricity tariff every year.

CERC wrote to the Union Minister for Power Veerappa Moily that poor technical and financial performance of electricity distribution companies should not result in burden on the consumers. Set up in 1978, CERC is a non-profit, non-government organisation based in Ahmedabad.

It has been playing an important role in various committees of Central and State government to protect the interests of consumers. CERC also publishes a bi-monthly consumer magazine-Insight.

CERC is concerned about poor financial condition of state electricity distribution companies. The accumulated losses have crossed Rs 2 lakh crore after implementation of Electricity Act in 2003, CERC said in its letter to Moily.

States like Gujarat and Andhra Pradesh have fared well and improved their financial condition with better operational efficiency. CERC feels that role of State Electricity Regulatory Commission is very important to improve the financial & technical performance of state utilities, CERC told to Moily.

CERC registered its disagreement with the ministry over frequent bail out of electricity distribution companies. It stated that the package of Rs 1.9 lakh crore approved by the government would put additional burden on people of India as Central and State governments will recover it by imposing various taxes.

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