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Protection of consumers’ interest is one of the key objectives of the Electricity Act, 2003 and it has been explicitly articulated in the preamble of the Act. The chapter explains in brief the provisions of the Electricity Act and the policy regarding protection of consumers’ interest, for instance, universal service obligation, grievance handling mechanism, standards of performance, and consumer advocacy. Judicial pronouncements have also been relied upon to explain the context of some of these important provisions of the law and the policy.

This chapter deals with the evolution and key features of the Electricity Act, 2003. It also covers the two sets of amendments to the Act. The perspective that has gone into the making of the Act and various policies has been explained, while at the same time delving into the circumstances that have led to contemplation over and enactment of amendments to the Act. The Electricity Act, 2003, has repealed the three earlier Acts, namely, The Indian Electricity Act, 1910, The Electricity (Supply) Act, 1948, and the Electricity Regulatory Commissions Act, 1998. This chapter traces the legal and policy changes over the decades and explains how the new law brings about a paradigm shift in the electricity sector in India. It also draws on some important pronouncements of the Supreme Court that are considered critical to understanding the import of various provisions of the new law.

This chapter deals with broad aspects related to the implementation of the Electricity Act, 2003. It covers the various policies, namely, National Electricity Policy, Tariff Policy, and Rural Electrification Policy conceived and framed under the provisions of the Act, and also analyses the issues around some of the provisions of these policies. It brings before the readers the implementation challenges facing the Act and the policies. Rules and statutory orders issued under the Act have also been covered in brief. This chapter goes on to introduce the readers about the broad contours of reforms as envisaged by the Act, for instance, competitive framework like open access, tariff-based competitive bidding, reorganization of State Electricity Boards (SEBs) and other major steps on the implementation of the Act.

Restructuring of the electricity industry is one of the important interventions which the Electricity Act envisages for bringing about competition and ensuring efficiency in the operation of the industry in the country. This chapter presents an overview of the restructuring system, discusses the status of unbundling of State Electricity Boards, and deals separately with the restructuring in generation, transmission, and distribution segments. The concept and issues around multiple distribution licensees in the same area of supply have been dealt with in this chapter. The vision of the Act in doing away with the single buyer model has been explained, and the present state of affairs in terms of implementation of this requirement has been examined with live examples from some states. The chapter reiterates the objectives of restructuring the electricity industry in terms of providing competition for the benefit of consumer, attracting private investment, and improving efficiency of operations. It also suggests the way forward for translating this vision of the Act into reality.

This chapter traces the evolution of inter-state transmission in India. It presents a legal and policy overview and the vision in the Electricity Act, 2003 about the development of this important segment. It highlights the importance of transmission planning and explains the provision in the law and policy in this regard. The chapter describes provisions of competitive bidding in transmission and highlights the salient features of the bidding guidelines, while presenting comparison at relevant places between the bidding guidelines for procurement of power and procurement of transmission services. The important aspect of access to inter-state transmission has also been covered in this chapter. The chapter also discusses the concept and issues of dedicated transmission line and concludes by presenting future challenges and the way forward for the development of inter-state transmission of electricity in India.

This chapter provides a historical perspective and treatment to captive power generation in the law and policies. It then goes on to describe the vision behind the provisions on captive power generation under the Electricity Act, 2003. Significant flexibility brought in by the rules notified on captive generation and group captives has been presented. The chapter presents the current status of captive power generation in India. Major issues in the context of key provisions of the Act and the policy of encouragement of captive power plants (CPPs) have been examined. The chapter also presents illustrative cases of captive power generation by national-level organizations like National Thermal Power Corporation (NTPC), Indian Railways, and Steel Authority of India Limited (SAIL). These illustrative cases highlight how captive power plants have been utilized for cost efficiency and increased availability in grid power.

Open access is widely recognized as the most important tool for introduction of competition in the electricity sector in India. This chapter explains the importance of open access and elaborates the legal and policy provisions regarding this critical aspect. While presenting the current status of implementation of open access at the inter-state and intra-state levels, this chapter examines the reasons why open access has not succeeded especially at the intra-state level. Open access for consumers is the ultimate objective of the new law and there are issues around making this happen. The chapter critically examines all such issues. While explaining the initiatives taken so far, especially by the Forum of Regulators (FOR) towards addressing some of these issues, the chapter presents the future prospects in this context.

This chapter examines the institutions and ideologies that emerged from New Delhi. Emboldened and inspired by Lenin's Russia, Nehru, Ambedkar, and others believed that state-financed electrification would be the means of transforming the productive capacities of the country. Although there were prominent supporters of a centralized system, the electric grid was organized along federal boundaries. The late 1950s through the 1980s represent the heyday of provincial public utilities, although throughout this period, the central government gradually wrested authority for energy and electricity from the states, first to stimulate more rural electrification and later to augment generation supplies and interconnect the various state and regional grids. Starting in the early 1990s, as part of a larger turn toward the market, New Delhi created rules to facilitate the entry of private capital into a sector that hitherto had been the purview of the state.

Capacities for meeting peak demand for power are the need of the hour. This chapter outlines perspectives from the supply side as well as the demand side for peaking power and also explains the pre-requisites for making investments in peaking power plants feasible. The Electricity Act, 2003 and the Tariff Policy have provisions for differential tariff based on total consumption for a specific period and introduction of differential rates for fixed charges for peak and off-peak generation for better management of load. The chapter presents the current scenario in this respect and also the regulatory response so far. The chapter analyses the various issues which are seen as a constraint to the development of peaking power capacity in the country. Required policy and regulatory interventions have been suggested to encourage setting up of peaking power plants which are urgently required for the power sector in India.