WHY IN NEWS? KEY PROPOSALS
The matter is controversial because several state governments commit free electricity to induce voters before elections. It includes permitting many utilities to exercise within the same circles, ordering regulators to set tariffs established on market costs, and; defining payment process and time limits or deadlines according to citizens with knowledge of matters to be unidentified as the details are not public yet. the bill was presented to parliament in the current session that runs through August 12, 2022.
Critics say the amendment is to make it easier for the companies to acquire the sector as wealthy customers would switch to private firms, leaving state-run utilities with users who depend on subsidies.
The bill questions regulators to set a floor tariff in areas, two or more suppliers are existing in a single distribution circle.
IMPACT
Due to the free promise of electricity Politicians then pin regulators to dictate cheaper tariffs and regional authorities fail or break down to transfer subsidies; Money-losing retailers slow payments to power generator operators and coal suppliers, Weakens the entire supply chain.
POWER SECTOR IN INDIA
Power is among the most critical ingredient of infrastructure for the welfare of nations and economic growth. India’s power sector is one of the most expanded in the world. Power utilization in the country grew 13.6% per year on 132.98 billion units (BU) in April 2022.
FACTORS OF LOW COAL COST AT POWER PLANT
- Heightened power demand due to the Boom in the economy post-covid-19, The early arrival of Summer,
- The rise in the price of gas and imported coal, and;
- The sharp fall in electricity generation by coastal thermal power plants.
Note- If need more info. please visit the Govt. website ‘Ministry of Power’.
WHAT ARE THE CHALLENGES FACED BY THE POWER SECTOR?
Fuel Security Concern:
A significant natural gas-based capacity of more than 20000 Megawatt is inactive due to the non-availability of natural gas.
Coal supply is restricted, leading to increase dependence on imported coal with the overflowing result of high power generation costs.
Aging Power Plants and Transmission Network:
Since most of the power plants and transmission lines have been installed immediately after independence, they have become old and inefficient.
and lastly Interstate disputes.
Do you know what are pointers of interstate disputes and also what impacts will change after the Bill is enacted. We awaits the new amendment.
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