Maharashtra Veej Grahak Sanghatana, a state-level coordination committee of industrial associations and power consumers, has approached the state government for urgent intervention on key concerns after Maharashtra Electricity Regulatory Commission on December 9 published the draft of the MERC (Electricity Supply Code and Standards of Performance of Distribution Licensees including Power Quality) Regulations, 2020, inviting public suggestions and objections.

The committee pointed out that the commission’s draft on changes goes against recently notified Ministry of Power, GoI, Electricity (Rights of Consumers) Rules, 2020. “MERC regulations have to be consistent with MoP Rules and cannot have such contradictions,” it says.

The committee in its suggestions and objections says that there is nothing new in the draft regulations and offer no improvements to the existing Supply Code Regulations 2005 and MERC (Standards of Performance of Distribution Licensees, Period for Giving Supply and Determination of Compensation) Regulations, 2014 which the draft regulations attempt to further deteriorate.

“All changes proposed in draft regulations are in favour of licensees and take away legal rights of consumers which is against the essence of Electricity Act 2003, National Electricity Policy and National Tariff Policy. The Electricity Act, 2003 must be implemented in letter and spirit. The draft regulations favour licensees and push back to 1960s era and the MERC must not take unjust views of its implementation,” it says in its comments, suggestions and objections to the state government.         

Pratap Hogade, convenor of the state coordination committee and president of Maharashtra Veej Grahak Sanghatana, said that the new draft code is an attempt to dilute several provisions which are in the interest of the consumer. Instead of improving the Act on the basis of past experience, suggestions and objections these draft rules and regulations are an attempt to deteriorate existing laws. “Consumers rights have been taken away from 10 provisions. When the Preamble to our Constitution provides for consumers protection it has to be the guiding force and the laws cannot go against it” he says.

Hogade says that as compared to 2005, the tariff has increased times. The state has the highest power tariff in every category and 20%-40% higher as compared to adjoining areas. “This is only due to inefficiency.” On March 30 during complete lockdown the commission came out with an order on increase in tariffs. After increasing the power tariffs it issued a press release that the electricity tariff had been reduced by 7% and a statement to the effect was given by energy minister. If the tariff is introduced for consumer welfare it is welcome but if it is brought in to deny their rights it is a deliberate attempt to deny their rights” he says.

On the proposed changes to the level of compensation payable by the licensee, the committee says that compensation amount is a penalty for failure to meet standards of performance which happens due to negligent and errant officials or employees. It cites the Supreme Court order dated 5/11/1993 in case of Lucknow Development Authority Vs MK Gupta where the apex court has said that compensation amount should be fully recovered from errant and negligent officials or employees. “This amount should not be spent by the licensee or recovered through ARR from consumers.” The consumer body states that the SC order has become law of land in similar compensation cases.

It says that fixing a cap on compensation amount and reducing compensation amount to 50% or25% is totally unjustified. “GoI, MoP suggests penalty of Rs 1,000 per day in case of delay in new connections. When the value of rupee since Supply Code Regulations 2005 has reduced the compensation amount should at least double of that. Such caps give unlimited powers to licensees and get away with meagre punishment.”

It also says that 90% average bills are generated due to gross negligence of proper meter reading or  billing by licensee, due to which bills are higher than actual reading  and lead  to harassment of consumers. “It is therefore necessary that licensee is penalized or made to compensate. As per GoI MoP, Rights of Consumer Rules 2020, if the consumer receives three average bills he may refuse to pat the licensee.”

Where the commission revises, changes or creates a new tariff category, it says that it is the duty of the licensee to carry out field inspection of concerned consumers and properly revise the tariff from the date of its implementation. “But it is seen that due to negligence of officers that is not happening thereby causing loss to consumer or the licensee and leading to unnecessary and avoidable grievances and litigation.”

On draft changes with reference to transformer installation and lease rent, the body says that earlier provision must be retained. It recommends that when a DTC (distribution transformer centre) is installed for a single consumer it should take necessary undertaking from him till disconnection and not charge lease rent. But if the DTC is installed in a single consumer premise for multiple consumers then he must get lease rent on the basis of fair market price and as mutually agreed between the licensee and consumer.

“So far they were paying rent. Now they have done away with rent which they were giving as per fair market rates. If they are setting up transformer work in private land they will now give Rs 1. If the transformer is providing power to 50-100 consumers the person on whose land the transformer has been set up must receive rent. But now for this Rs 1 rent he will have to make a lease agreement for which he will incur cost of Rs 5,000. MSEDCL recovers such common expenditure through ARR (arrears) and is revenue neutral. The commission must be fair and equal to similarly placed consumers and retain its earlier provision on transformer installation and lease rent,” says Hogade.  

Regarding and changes to the structure of CGRF (consumer grievances redressal forum) and Ombudsman Regulations which were published in June the draft amendments have done away with three stage grievance redressal mechanism which had come into place on September 2019.

“Earlier an ombudsman was a retired high court judge or a retired bureaucrat. These people had knowledge of law. As per the new rules now any retired director of licensee can be appointed as ombudsman. Needless to say, such a person will be biased and pro-licensee. After finishing institutional justice mechanism now they are also finishing Supply Code Regulations and some pro-consumers provisions. This will leave the consumers at mercy of licensee and deny them justice. There are three separate bodies -government, licensee and commission. While licensee will safeguard its own interests, the government should take independent decisions in the interest of public, development, consumers protection and law and justice. Government makes laws, instead government is least bothered. It must make good appointments to the post of commission’s chairperson and revise its regulations,” says Hogade.

Governance Now tried to reached out to state power minister Nitin Raut several times but he did not reply.