Cough up penalty for not paying electricity bills on time

Law to be amended to make obligations under PPAs binding, said union power minister RK Singh

GN Bureau | October 27, 2017


#Electricity Bill   #PPA   #Power Purchase Agreement   #ASSOCHAM   #DBT   #RK Singh  
Representational image
Representational image

The government will soon amend the law making obligations under power purchase agreement (PPA) statutory binding, said union power minister RK Singh.

“I have called a meeting of energy ministers of all states on November 10-11. I will tell them that I am going to make obligations under PPAs statutory binding, that all discoms must have PPAs to cover 100 percent of requirement and that there will be penalties for not paying electricity bills on time,” said Singh while inaugurating an ASSOCHAM Global Investors’ India Forum in New Delhi.

He also said that he will tell all state energy ministers that there has to be a limit to cross-subsidisation in tariff to make the industry competitive.

“The second target that I will tell them is that if you want to give subsidy to any sector, you do it through Direct Benefit Transfer (DBT) so that efficiencies and inefficiencies of discoms are clear,” said Singh.

Stressing that he has a clear roadmap for reforms in the power sector, Singh said that government will make it certain that payment of electricity bills are made on time by going for smart metering and pre-paid metering.

“I am also going to provide in the law penalties if power bills are not paid promptly and the amended law will also provide that the RPOs (renewable purchase obligations) will be obligatory. It will be a statutorily legal compulsion because we are not going to go back on our commitments made to the world and international community that about 30 percent of our power will be from green sources of energy,” he said.

“We have proposed to bring that in the amendments which we are contemplating in the Electricity Act, where we will deal with the issue of PPAs and RPOs,” he added.

On hydro policy Singh said: “A draft was put up to me. I am seeing it. They are refining it and once it is ready, we will send it to the cabinet.”

He said that he will try to get it passed in the winter session of parliament.

He also said that power demand in India is going to grow because coverage is going to expand and is going to be universal.

 

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