Panel calls for reviewing CERC functioning

Collapse of power grid exposed ineffectiveness of statutory body

A parliamentary panel has recommended review of the functioning of the central electricity regulatory commission (CERC).

The panel noted that the recent power outrage affected as many as 22 states due to grid failure and exposed the the “ineffectiveness” of the statutory body.

In its report tabled in Parliament on Friday, the committee, headed by Samajwadi Party chief Mulayam Singh Yadav, said the national electricity regulator had failed to achieve its basic mandate to transform power sector into a “modern, vibrant, efficient, responsive and productive sector.”

“The government should take necessary steps to appoint an independent Committee of experts to review the functioning of CERC and identify the areas which require improvements in the working of the organization and limitations of the autonomy and legislation,” the panel recommended.

The mission statement of CERC seeks to promote competition, efficiency and economy in bulk power market, improve the quality of supply, promote investment and to advice the government on the removal of institutional barriers to bridge the demand-supply gap and foster the interest of the consumers. “Despite the given mandate for transforming the power sector, the CERC has done precious little in discharge of its duties to achieve the objectives,” the panel underlined.

The duties assigned in principle to the CERC, were to shape and revive the “sagging” power sector by making it efficient, economic, energized and ebullient. “However, it is regretted that it is still a controlled, traditional and non-resilient labyrinth confounding the consumers,” the report said, strongly recommending that CERC must shed its inhibition and laid-back approach to be in the forefront of heralding a new era in the power sector by the true spirit of the Electricity Act 2003.

The CERC has taken many steps including formulation of an efficient tariff setting mechanism, improving the operations and management of the regional transmission centers, facilitating open access in inter-state transmission and facilitating inter-state trading, promoting development of power market.

The Commission has also adopted certain guiding principles which include protection of the interest of the society including the consumer and supplier, remaining equitable in conflict resolution, maintaining regulatory certainty, adopting participative process in formulation of its regulation.