Delhiites will soon be able to choose their power company as the government is making necessary amendments in the Electricity Act to encourage competition in the power distribution space.
Shifting focus from generation, the government plans to fix electricity distribution which is often described as the Achilles heel of the power sector. Power and Coal minister Piyush Goyal on Saturday said the provision allowing the end-user to choose the distribution company is being worked upon.
The move to offer consumers more choices will help reduce the losses of discoms as well as improve overall electricity supply. According to the proposal, a new model where a power supplier will not manage the electricity distribution network, is being looked at.
Goyal said this will be on the lines of existing systems in the United Kingdom which has separate suppliers and electricity network providers. At present, in India power discoms supply as well as manage the network that provides electricity for residential and commercial purposes.
In a separate carriage and content model, the network would be owned by one company while the suppliers of electricity could be more than one.
The power minister said competition would be encouraged in the interest of keeping power tariff low and for better customer service.
On being asked about allowing end users of electricity to select their own power distribution firm, Goyal said it will be done gradually, adding that it was tried in Maharashtra but due to some court decisions it couldn’t go further. There were some hurdles under the Electricity Act of 2003, he said when asked why the proposed model did not work in that state.
“We are trying to remove those hurdles under the current amendment to the Electricity Act,” he added.