The Electricity Act is the statute which governs generation, transmission, distribution, trading and use of electricity in India. It constitutes various authorities for dispute resolution and for regulation. Also, the Electricity (Amendment) Bill, 2020 proposes to constitute a Electricity Contract Enforcement Authority (ECEA).
In this context, it is important to understand who are the different authorities and what are their powers and functions.
Before we delve into the authorities, we need to understand that the main players in the industry are generation companies, distribution licensees and the consumers. Generation companies as the name suggests are involved in generation of electricity. After generation, the next stage is the transmission and then, distribution of electricity which is done by a distribution licensee who operates and maintains a distribution system for supplying electricity to the consumers in its area of supply.
Central Electricity Authority : Part IX of the Electricity Act deals with the constitution, powers and functions of the Authority. This authority promotes research and specifies the technical standards for construction of electrical plants, electric lines and connectivity to the grid. It advises the Central Government on matters relating to national electricity policy for optimal utilisation of resources. They issues regulations regarding construction standards, transaction of business , metering , grid operation, connectivity, safety measures and communication system. They also have the power to require statistics as per Section 74 of the Electricity Act.
Central Electricity Regulatory Commission: There are regulatory commissions which are constituted at the Central and State level. Their main role is to determine tariff. In simple terms, tariff is the price at which consumers buy their electricity. It is not the same price that everyone pays; it changes from category to category. The category may depend upon volume, purpose etc. For example, the tariff for a factory won’t be the same as the one for a household. So electricity regulatory commissions play a key role in determining who belongs to which category. The constitution, powers and functions of Central Electricity Regulatory Commission [CERC] is laid down in Part X of the Act. The CERC regulates the tariff for generating companies owned by the Central Government, for generating companies who operate in more than one State and for interstate transmission of electricity. In case, generating companies or transmission licensees have any dispute regarding the tariff so determined, the Authority adjudicates the disputes. It specifies Grid Code having regard to Grid Standards. Grid to put in easy language is an interconnection necessary for transmission of electricity between producer and consumer.
State Electricity Regulatory Commission
There are regulatory commissions formed in states known as State Regulatory Commission. For example, there is a Kerala State Electricity Regulatory Commission in Kerala. The powers and functions of this commission is provided under Section 86 of the Act. It determines tariff for generation, supply and transmission of electricity within the state. It also regulates electricity purchase and procurement process of distribution licensees including the price at which electricity shall be procured from the generating companies or licensees or from other sources through agreements for purchase of power for distribution and supply within the State. They specify Grid code in accordance with the Grid Code specified by the Central Government.
They can adjudicate upon the disputes between the licensees, and generating companies and can refer any dispute for arbitration.
Both Central Regulatory Commission and State Regulatory Commission, can specify the standards with regard to quality, continuity and reliability of service by licensees and fix the trading margins for inter-state trading of electricity, if necessary.
Appellate Tribunal for Electricity (APTEL)
As per the Electricity Act, appropriate commission appoint adjudicating officers as per Section 143 for the purpose of adjudicating as per the Act. Any person aggrieved by an order made by an adjudicating officer under the Act except under section 127, or an order made by the regulatory commission may prefer an appeal to the Appellate Tribunal for Electricity. The procedure for Appeal is provided under Section 120 of the Act. An order passed by APTEL is executable as decree of civil court and has all the powers of a civil court. Any person aggrieved by any decision or order of the Appellate Tribunal, may, file an appeal to the Supreme Court under Section 125 of the Act.
As the Electricity Act, every distribution licensee (for example, Kerala State Electricity Board) has to establish a forum for redressal of grievances of the consumers. If the grievance is not redressed by the forum, then the consumer may make a representation for the redressal of his grievance to an authority to be known as Ombudsman who is appointed by the State Commission. So if you are a consumer, then the remedy for you is to approach the forum established by the distribution licensee. If it is not addressed, then the next forum is the ombudsman. If the order of the Ombudsman is arbitrary, it is seen often that the consumers approach the Court under Writ Jurisdiction for redressal.
Proposed Electricity Contract Enforcement Authority (ECEA)
The amendment to the Electricity Act proposes to establish a Electricity Contract Enforcement Authority (ECEA) to adjudicate contractual disputes arising from contracts relating to sale, purchase, or transmission of electricity. It would have no power over any other matter related to regulation or determination of tariff or any dispute involving tariff which is vested with appropriate commissions.
When there is a dispute, it is important to understand which is the relevant authority that can redress the grievance. Sometimes, the regulations by these authorities are challenged on the ground that the authorities do not have the power to issue such a regulation as per the Act.
The developments in dispute resolution in Electricity law would be interesting if the new authority is constituted as proposed by the Electricity Amendment Bill, 2020.