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Power Grid should not be Central Transmission Utility: FICCI

August 15, 2013

Industry body FICCI has suggested that state-run Power Grid Corp should no longer be the ‘Central Transmission Utility’ as its present powers can lead to arm-twisting private players.

Power Grid was conferred with the title of Central Transmission Utility in 1998 with the idea that it would undertake transmission of electricity through an inter-state transmission system, discharge planning functions and provide non-discriminatory open access to the system.

“Currently, Power Grid is tariff collection agency; it collects tariffs from power generators, state electricity boards, etc., and retaining its share distributes the remaining to other private licensees. This confers additional powers to the company to potentially arm-twist private players,” FICCI said in its research paper.

The industry body suggested that it would be better if a neutral entity like an independent Central Transmission Utility (CTU) becomes tariff collection agency and it is only possible when the CTU tag is hived off from Power Grid.

The paper in its observation said that the CTU cell at Power Grid is grossly under staffed and hiring for some positions is not being prioritised. The paper further observed that Power Grid can make sensitive information available to it without much difficulty.

At present, the transmission projects are offered through the tendering route and they are identified by an Empowered Committee (EC). EC consists of officials from the Central Electricity Regulatory Commission (CERC), Central Electricity Authority (CEA), NTPC and Power Grid.

“Being part of the EC, Power Grid is likely to be privy to commercially sensitive information and decision-making process while private players do not even have any representation,” FICCI paper observed.

FICCI paper said that the CTU should be hived off from Power Grid and should work as an independent not-for-profit entity and Power Grid should not be allowed to be a member of the EC due to conflict of interest.


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