The All-India Power Engineers Federation (AIPEF) opposed the amendments in the Electricity Act-2003, whereby the entire power distribution setup will be unbundled in its meeting with power minister Piyush Goyal.
Goyal said his ministery had already finalised the amendments to the Electricity Act-2003 and the Bill be moved in the Parliament's current session in the next few days and was likely to be passed in the budget session.
"With the government not listening to the power engineers, the biggest stakeholder of the power sector, and the union cabinet approving the various amendments to the Electricity Act-2003, the confrontation is likely to take place," said federation spokesperson VK Gupta.
India is an energy-starved nation. Reducing price of power through competition is impractical. The multiple licensee system will be like "cherry picking" and the deterioration of the existing power distribution companies under the state sector will only cater to supplying electricity to the unprivileged common. This simply means nationalising the losses and privatising the profits, stated an AIPEF press release.
"The competition is possible only in a situation of surplus, not scarcity of electricity that the country was facing. At present, nearly 40% population of country does not have access to power as they cannot afford power even at the existing rates.Therefore, giving multiple licenses of supply will lead to chaos, heavy losses of discoms, endless litigations and sky-high tariffs for common people," stated the AIPEF press release.
As electricity is a concurrent subject, the states have the right to decide the structure of distribution system. Passing of legislation by the Parliament would clearly encroach upon the states jurisdiction on a concurrent subject.
The move to introduce supply licensees is a step to introduce privatisation by back door and driving the state discoms (with accumulated losses of Rs 5 lakh crore) further into losses, said the AIPEF, announcing that they would oppose any such move.