Electricity (Amendment) Bill 'implies sinister design': Mamata Banerjee writes to PM Modi

West Bengal CM Mamata Banerjee on Saturday wrote a strong letter to PM Narendra Modi protesting over the introduction of the Electricity (Amendment) Bill 2020, in Parliament. In her letter, Mamata Banerjee claimed that the bill was proposed last year as well but it was criticised and required wider consultations with state governments. Mamata Banerjee has claimed that the aforesaid Bill snatches away the regulatory power from State Governments in the power sector and vests the power with the Central Government, thus undermining the federal structure in a sector that is on the concurrent list.

In her letter to PM Modi, Mamata Banerjee said, "I had believed that wider consultations with stakeholders would now be initiated for a consensual view on the sensitive subject at hand. But I am stunned to hear that the Bill is coming back without any consideration for our reservations, and in fact with some graver anti-people features this time."

"Power is too important a sector for unilateral interferences, especially when electricity, as a subject is on the concurrent list of the Constitution of India and any legislation on a subject in such a list, needs serious prior consultation with States. In the present case, there has been some tokenism of consultations, but no real exchange of views, which is antithetical to the federal structure of our polity," Mamata Banerjee added.

She also stated that "in the name of market reforms, the State will give up its commanding height, state PSUs will become sick and ailing and yet forced to serve areas where no corporate body would focus. Allowing cherry-picking to select private entities cannot be the goal of public policies, especially in a strategic sector like power".  

The Kerala Assembly on Thursday also unanimously passed a resolution demanding the Centre to withdraw the Electricity (Amendment) Bill, 2021. Before moving the resolution in the House, the state electricity minister said, "Central government failed to discuss with states about the electricity amendment bill and was unable to reach a consensus. As both the Centre and the state governments have the right to make laws in the matter of power distribution, the Centre should be committed to discuss the matter with states and reach a consensus. That is cooperative federalism."

Purpose of Electricity (Amendment) Bill

While there are opinions against the bill, saying that the bill will allow private sector entities to enter the power sector without any investment or obligation, thus having a risk of their speedy withdrawal in case of losses, and further create uncertainties in the power sector. However, optimists have also asserted that a free hand for the private sector will accelerate the efforts to ramp up the power generation capacity and also ramp up infrastructure for renewable energy in the country.

It is said that the regulatory system i.e. the regulatory commissions in the states have not been able to function with the desired efficiency, due to which the efforts of several Central schemes have not received the desired success with regards to the power sector. The bill aims to de-license the power distribution and increase competition, thus leading to reforms in the power sector.