Supreme Court allows open access to power | mumbai | Hindustan Times
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Supreme Court allows open access to power

Power guzzlers may now be allowed to buy power directly from any other source, but they cannot force their previous distribution utility to bail them out in case of non-availability of power from the new supplier.

mumbai Updated: May 24, 2011 01:41 IST
HT Correspondent

Power guzzlers may now be allowed to buy power directly from any other source, but they cannot force their previous distribution utility to bail them out in case of non-availability of power from the new supplier.

This has been ruled by the Supreme Court in the special leave petition moved by the state-owned power distribution company, Mahavitaran.

The utility had moved the Supreme Court after the Bombay high court refused to grant interim relief to it against the Maharashtra Electricity Regulatory Commission’s (MERC) directive to allow open access — a procedure in which a consumer can buy power directly from other supplier across the country by paying carrying charges to distribution and transmission companies.

Dismissing Mahavitaran’s petition on Monday, a bench of justice CK Prasad and justice GS Singhvi was of the opinion that the high court should decide the matter as soon as possible on its merits, and allowed Mahavitaran to move the high court in future for any matter related to open access.

Mahavitaran had opposed MERC’s directive of granting open access to high-end users saying that it would impact the electricity bills of the low-end consumers.

Mahavitaran had contended that high-end consumers pay more to cross subsidise power for low-end consumers.

The company had demanded cross subsidy surcharge (CSS) of Re1 per unit from migrated consumers so that it can provide inexpensive power to the poor.

Mahavitaran had cited example of the Punjab state distribution company that had incurred annual losses of more than Rs500 crore due to lack of CSS.

At present, open access proposals of 500MW are pending for approval before the MERC. Of this, Ispat Industries alone wants 300MW from a source other than the state-owned power distribution company.

These companies also want Mahavitaran to provide power backup when their new power supplier fails in meeting their demand.

Mahavitaran had opposed this demand.

Mahavitaran counsel Vikas Singh said that the company should not be forced to provide power to migrated consumers in case of emergencies.

Singh said if the company was to supply a standby 300MW to migrated companies such as Ispat Industries, it would be at the cost of other consumers.

On this, the apex court allowed open access but said that the company would not be obliged to supply standby quantum.