Proposed Amendments Affecting Transmission Service Provider
Proposed amendments in the existing clauses of Electricity Act 2003 by the current government. The comparison is only limited to the transmission part in the present Electricity Act. In the Electricity Act 2003, following proposed amendment will affect the transmission serviceAuthor Name: adv.chetansharma
Proposed amendments in the existing clauses of Electricity Act 2003 by the current government. The comparison is only limited to the transmission part in the present Electricity Act. In the Electricity Act 2003, following proposed amendment will affect the transmission service
Proposed Amendments Affecting Transmission Service Provider
Below mentioned are the proposed amendments in the existing clauses of Electricity Act 2003 by the current government. The comparison is only limited to the transmission part in the present Electricity Act. In the Electricity Act 2003, following proposed amendment will affect the transmission service.
| S.NO | EXISTING CLAUSE | CLAUSE SUBSTITUTED OR MODIFIED |
| 1 | S2(16) Definition of Dedicated Transmission Lines Dedicated Transmission Lines means any electric supply line for point to point transmission which are required for the purpose of connecting electric lines or electric plants of a captive generating plant referred to in Section 9 or generating station referred to in Section 10 to any transmission lines or sub-stations or generating stations or the Load centre, as the case may be. |
“Dedicated Transmission Lines” means any radial electric supply-line for point to point transmission which is required for the purpose of connecting a captive generating plant or generating station to any transmission line or substation or switching station or generating station, or the load centre, as the case may be, subject to the condition that such line shall not form a loop with the grid and shall not be shared except with the prior approval of the Appropriate Commission. Understanding –The definition is modified. It means the electric supply line from the generating station (origin) to sub- station or switching station or generating station or the load centre subject to the condition that such line shall not join grid between the beginning till end unless the same is approved by the Appropriate Commission. |
| 2 | S2(35) Definition of High Voltage line High Voltage Line means an electric line or cable of a nominal voltage as may be specified by the Authority from time to time |
“high voltage line”, the words “high voltage line or high pressure cables” shall be substituted Understanding – High Voltage Line or High Pressure cables both the terms will be used to define the High Voltage Line. |
| 3 | New definition is added | “Incumbent Supply Licensee” means the entity to which the supply functions and undertakings, other than those vested in the intermediary company, is vested under sub-section (4A) of section 131; |
| 4 | New definition is added | “Intermediary Company” means the entity succeeding to the existing power purchase agreements and procurement arrangements of the relevant distribution licensees on reorganisation as per sub-section (4A) of section 131; |
| 5 | S2(41) Definition of Local Authority - Local Authority means any Nagar Panchayat, Municipal Council, Municipal Corporation, Panchayat constituted at the village, intermediate and district levels, body of port commissioners or other authority legally entitled to, or entrusted by the Union or any State Government with, the control or management of any area or local fund. | “Local Authority” means any urban local body or rural local body or body of port commissioners or other authority entrusted by the Union or any State Government with the control or management of any area or local fund; Understanding – The definition is modified. The new definition has not used the words Nagar Panchayat, Municipal Corporation, Panchayat constituted at the village, intermediate and district levels and hence resemble the same with the term any urban local body or rural body |
| 6 | New definition is added | “Smart Grid” means an electricity network that uses information and communication technology to gather information and act intelligently in automated fashion to improve the efficiency, reliability, economics, and sustainability of generation, transmission and distribution of electricity and such other information as may be specified by the Authority |
| 7 | Section 12 – No person shall :- a. Transmit electricity or b. Distribute electricity or c. Undertake trading in electricity unless he is authorised to do so by a licence issued under Section 14 or is exempt under Section 13. |
“12. (1) No person shall - (a) transmit electricity; or (b) distribute electricity; or (c) undertake trading in electricity; or (d) supply of electricity to consumer, unless he is authorised to do so by a licence issued under section 14, or is exempt under section 13: Insertedor Added part in this Section Provided that no licence shall be required by a generating company, a captive generating plant and a trading licensee for supply of electricity to openaccess consumer in any place: Provided further that no licence shall be required for the activities assignedto the intermediary company under the Act. (2) The Appropriate Commission shall not grant licence to more than onedistribution licensee in any area of distribution: Provided that where two or more distribution licensees within the same area ofdistribution are existing on the date of the commencement of the Electricity (Amendment)Act, 2014, they shall continue their operation till such period as specified in their licence. (3) Without prejudice to sub-section (2), the Central Government in consultation with the Appropriate Commission may, in public interest, permit more than one distribution licensee to operate in any area, if it is considered necessary” Understanding – Section 12 states that unless the license is issued under Section 14, no person shall transmit electricity. However, the amendment is not dealing with the transmission activity but with distribution licensee or a trading licensee. |
| 8 | Section 14 – Grant of License The Appropriate Commission may, on an application made to it under section 15, grant a licence to any person— (a) to transmit electricity as a transmission licensee; or (b) to distribute electricity as a distribution licensee |
application made to it under section15, grant a licence to any person— (a) to transmit electricity as a transmission licensee; or (b) to distribute electricity as a distribution licensee: Provided that the Developer of a Special Economic Zone notified under sub-section (1) of section 4 of the Special Economic Zones Act,2005, shall be deemed to be a licensee for the purpose of this clause, with effect from the date of notification of such Special Economic Zone: Provided further that the decentralized distributed generation networks not connected to the distribution system may continue to operate without getting connected to the distribution system, even incase of grant of licence for operation of the distribution system in that area; Understanding – The Amendment is added Developer in SEZ shall deemed to be included as licensee for the purpose of this clause. |
| 9 | Section 15(8) - A licence shall continue to be inforce for a period of twenty-five years or more as may be specified in the licence, unless such licence is revoked | Section 15(8) - A licence shall continue to be inforce for a period of twenty-five years or more as may be specified in the licence, unless such licence is revoked or renewed. Understanding – Only word renewed is added in last. |
| 10 | Section 20 - Sale of Utilities of Licenses - (1) where the appropriate commission revokes under Section 19 the license of any license, the following provisions shall apply namely- | In section 20 of the principal Act,— (a) in sub-section (1),— (i) in opening portion, after the words “licence of any licensee”, the words" or when the duration of any licence expires” shall be inserted; (ii) in clause (a), after the words “licence has been revoked”, the words and brackets “or expires (hereinafter referred to as the outgoing licensee)” shall be inserted; (iii) in clause (c), after the words “revocation of licence”, the words “orexpiry of the period of the licence or” shall be inserted; (b) for sub-section (2), the following sub-section shall be substituted, namely:— “(2) Where a utility is sold under sub-section (1), the purchaser shall payto the licensee the purchase price of the utility in such manner as may be agreed upon between the parties.’’; (c) In sub-section (3), for the words “the licence” wherever they occur, the words “outgoing licence” shall be substituted. Understanding – Section 20 deals with the sale of utility of licensees if the license is revoked under Section 19. Section 19 deals with the conditions where the license can be revoked during the term of licensee. The amendment modification is subjected to the additionof the word when the duration of any license expires or revoked under Section 19. |
| 11 | Section 29- Compliance of directions -If any licensee, generating company or any other person fails to comply with the directions issued under sub section (2) or sub section (3), he shall be liable to a penalty not exceeding rupees fifteen lakhs. | In section 29 of the principal Act, for sub-section (6), the following sub-sectionshall be substituted, namely:— “(6) If any licensee fails to comply with the directions issued under sub-section (2)or sub-section (3), he shall be liable to a penalty not exceeding ten crore rupees: Provided that in case of non-compliance of the directions issued under subsection(2) or sub-section (3), by a generating company for generating renewableenergy, such generating company for generating renewable energy shall be liable to apenalty not exceeding one crore rupees.”. Understanding – The penalty limit is exceeded to Rs. 10 crores from Rs. 15 Lakhs. Sub section 2 and 3 states that all the persons connected with the operation of power system shall comply with the directions issued by Regional Load Dispatch Centre and State Load Dispatch Centre. In case of non-compliance of directions, the licensee shall be penalized. |
| 12 | Compliance of directions - Section 33 (5) if any licensee, generating company or any other person fails to comply with the directions issued under sub-section (1), he shall be liable to a penalty not exceeding rupees five Lakhs. | In section 33 of the principal Act, for sub-section (5), the following sub-section shall be substituted, namely:— “(5) If any licensee fails to comply with the directions issued undersub-section (1), he shall be liable to a penalty not exceeding one crore rupees: Provided that in case of non-compliance of the directions issued under subsection(1), by a generating company for generating renewable energy, such generatingcompany for generating renewable energy shall be liable to a penalty not exceedingten lakh rupees.”. Understanding – The amendment proposed that in case if any licensee fails to comply with the directions issued by the State Load Dispatch Centre, he shall be liable to the penalty not exceeding Rs. 1 crore |
| 13 | Section 34- Grid Standards – Every transmission licensee shall comply with such technical standards, of operation and maintenance of transmission lines, in accordance with the Grid Standards, as may be specified by the Authority | Every licensee or generating company, person owning and maintaining dedicated transmission lines and any other person whose system is connected to the grid shall comply with such technical standards of operation and maintenance of transmission lines, in accordance with the Grid Standards, as may be specified by the Authority.” |
| 14 | Section 40 – Duties of Transmission Licensees S.40(c) to provide non-discriminatory open access to its transmission system for use by- (ii) any consumer as and when such open access is provided by the State Commission under Section (2) of Section 42, on payment of the transmission charges and a surcharge thereon, as may be specified by the State Commission. |
In section 40 of the principal Act, in clause (c), in sub-clause (ii), for the words “as may be specified by the State Commission”, the words “as may be specified by the Appropriate Commission of the State in which the premises of the consumer is located” shall be substituted. |
| 15 | Section 62 – Determination of Tariff – (1) The Appropriate Commission shall determine the tariff in accordance with the provisions of this Act for – (a) Supply of electricity by agenerating company to a distribution license. |
Section 62. (1) The Appropriate Commission shall determine the tariff in accordance with the provisions of this Act for— (a) supply of electricity by a generating company to a supply licensee including supply of electricity under a back to back arrangement involving an intermediary company, electricity trader or any other licensee: Understanding – We are also covered under Section S.62(1)(a) and (b). The proposed amendment states back to back arrangement. (2) The tariff determined by the Appropriate Commission for a licensee shall provide for recovery of all prudent costs of the licensee approved by the Appropriate Commission in the monthly bills during the tariff period through an appropriate price adjustment formula including wherever applicable the fuel, power purchase and procurement price surcharge formula as may be specified in the Tariff Policy. Understanding – New sub section is added |
| 16 | S.64 Procedure for tariff order - New sub sections are added | In section 64 of the principal Act,— (i) after sub-section (1), the following sub-sections shall be inserted, namely:— “(1A) If the application is not filed in time the Appropriate Commission shall, not later than thirty days of the last date specified for such filing, on itsown initiate proceedings for determination of tariff and call for such information, details and document as the Appropriate Commission may require for such determination. (1B) The Appropriate Commission may draw adverse inference against the generating company or licensee for the failure to provide any information, details and document required to be filed before the Appropriate Commission.”. In sub-section (3), in the opening portion, for the words “one hundred and twenty days from receipt of an application”, the words “ninety days from receipt of application or initiation of proceedings, as the case may be,” shall be substituted. Understanding – New sub sections are added. It states that in case if the licensee did not file the application for the determination of tariff within 30 days of prescribed time, the commission shall determine the tariff on its own. The commission will also have the discretion to draw the adverse inference with respect to above mentioned issue. It is also proposed that the commission shall decide the tariff within 90 days instead of 120 days. |
| 17 | Section 67 (1)- Provisions as to opening up of streets, railways etc. – A licensee may from time to time but subject always to the terms and conditions of his license, within his area of supply or transmission or when permitted by the terms of his license to lay down or place electric supply lines without the area of supply, without that area carry out works such as - | In section 67 of the principal Act, in sub-section (1), for the words “supply or transmission”, the words “distribution or transmission” shall be substituted. Understanding –The amendment is with respect to distribution licensee. |
| 18 | Section 68 (5) – Overhead Licensee – Where any tree standing or lying near an overhead line or where any structure or other object which has been placed or has fallen near an overhead line subsequent to the placing of such line, interrupts or interferes with, or is likely to interrupt or interfere with, an Executive Magistrate or the authority specified by the Appropriate Government may, on the application of the licensee, cause the tree structure or object to be removed or otherwise dealt with as he or is thinks fit. | In section 68 of the principal Act,— (i) in sub-section (1), after the word, brackets and figure “sub-section (2)”, the words and figures “of section 67” shall be inserted; (ii) in sub-section (5), after the words “application of the licensee”, the words “or the generating company” shall be substituted; Understanding – S.68(5)- the amendment is not affecting us. |
| 19 | New Section is added | 69A.Whenever any person is carrying out any activity within the area of any transmission or distribution licensee or within the area of any other person operating and maintaining any system for conveyance of electricity and such activity is likely to have any implication on the transmission system or distributions system of such licensee or of such other person, such person shall obtain the prior consent of such licensee or such other person, as the case may be, in such manner as may be specified by the Appropriate Commission.” |
| 20 | S.92 Proceedings of Appropriate Commission - New sub section is added | In section 92 of the principal Act, after sub-section (5), the following sub-section shall be inserted, namely:— “(6) Every proceedings before the Appropriate Commission shall be decided expeditiously and with the endeavour to dispose the proceedings within one hundred and twenty days and in the event of delay, the Appropriate Commission shall record the reasons for delay beyond one hundred twenty days.”. Understanding – New sub section is added. |
| 21 | Section 142 - Punishment for non-compliance of directions by Appropriate Commission -In case any complaint is filed before the Appropriate Commission by any person or if that commission is satisfied that any person has contravened any of the provisions of this Act or the rules or regulations made thereunder or any directions issued by the Commission, the Appropriate Commission may after giving such person an opportunity of being heard in the matter, by order in writing, direct that without prejudice to any other penalty to which hemay be liable under this Act, such person shall pay, by way of penalty which shall not exceed one lakh rupees for each contravention any in case of any continuing failure with an additional penalty which may extend to six thousand rupees for every day during the failure continues after contravention of the first such direction. | Section 142 –Punishment for non-compliance of directions by Appropriate Commission -In case any complaint is filed before the Appropriate Commission by anyperson or if that Commission is satisfied that any generating company or licensee has contravened any of the provisions of this Act or the rules or regulations made hereunder, or any direction issued by the Commission or has not complied with the renewable purchase obligation or renewable generation obligation as specified, the Appropriate Commission may after giving such generating company or licensee an opportunity of being heard in the matter, by order in writing, direct that, without prejudice to any other penalty to which the generating company or licensee may beliable under this Act, such generating company or licensee shall pay, by way of penalty, which shall not exceed one crore rupees for each contravention and in case of continuing failure with an additional penalty which may extend to one lakh rupees for every day during which the failure continues after contravention of the first such direction: Provided that in case of non- compliance of by a generating company generating Renewable Energy, such generating company shall be liable. to a penalty not exceeding rupees ten lakhs contravention and in case of continuing failure with an additional penalty which may extend to ten thousand rupees for every day during which the failure continues after contravention of the first such direction.” Understanding – The penalty has been increased. |
| 22 | S146 Punishment for non-compliance of orders or directions – Whoever fails to comply with any order | 146.Punishment for non-compliance of orders or directions - Whoever, fails to comply with any order or direction given under this Act,within such time as may be specified in the said order or direction or contravenes orattempts or abets the contravention of any of the provisions of this Act or any rules orregulations made thereunder, shall be punishable with imprisonment for a term whichmay extend to three months or with fine which may extend to one crore rupees, or with both in respect of each offence and in the case of a continuing failure, with an additionalfine which may extend to one lakh rupees for every day during which the failurecontinues after conviction of the first such offence: Provided that nothing contained in this section shall apply to the orders,instructions or directions issued under section 121: Understanding – The penalty has been increased. |
| 23 | Section 149- offences by companies is completely deleted | |
| 24 | New Section is added | “186. (1) If any difficulty arises in giving effect to the provisions of the Electricity (Amendment) Act, 2014, the Central Government may, by order published, make such provisions not inconsistent with the provisions of this Act, as may appear to be necessary for removing the difficulty: Provided that no order shall be made under this section after the expiry of five years from the date of commencement of this Act. (2) Every order made under this section shall be laid, as soon as may be after it is made, before each House of Parliament” |
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