The May 8 directive is the latest in a series of instances where the ministry has invoked Section 107 of the Electricity Act to issue directives. The ministry has issued over adozen such directives under this section since 2018, with as many as five issued in the first five months of 2022 and a few sent this year too.
The earlier directives were on specific issues, ranging from environment norms for power plants to late surcharge on delayed payments. The ministry takes a grand stand in the latest directive to give itself an overwhelming say onall issues, which experts say raises questions over infringement of the regulator’s role.
“The ministry is responsible to Parliament and the people for the growth and development of the power sector. In the recent past, the ministry of power came across a number of critical issues to address which it had to issue policy directions to CERC, necessitating amendments in its regulations. Frequent changes in regulations are not in the interest of a predictable and stable regulatory framework in the country,” the latest directive said.
Section 107 allows the Centre to issue in writing policy directives to the regulator in matters involving public interest. “If any question arises as to whether any such direction relates to a matter of policy involving public interest, the decision of the central government thereon shall be final,” says the Act. Analysts maintain that such special powers to issue directive to regulators are meant to be used in “the rarest of rare” cases of national interest. Seen in this perspective, the multiple directives to CERC under special powers could indicate ministry’s petulance or agulf between the entities in spite of dialogues through the forum of regulators.
