Thiruvananthapuram: Will Kerala opt out of a central government scheme aimed at revamping the power distribution network in the country by installing prepaid smart electricity meters in households?
The fate of the project will be sealed after a meeting of the power minister with the chief minister next week.
The state government is expected to show the red flag to the Revamped Distribution Sector Scheme (RDSS) as the Central Committee (CC) of the state's top ruling party, the Communist Party of India (Marxist), has decided against implementing it.
CPM leaders said the state government will abide by the CC's decision not to implement the project. They said the CC's decision was taken after informing the leadership in Kerala.
The CPM central ommittee, which met from May 4 to 6, concluded that many states are being forced to implement the smart meter project due to pressure from the Central Government.
"Power supply will completely shift to the hands of the corporates who are only targeting profits, and there will be a huge burden on the common man and farmers. Considering this consequence, the project should be cancelled," the CC noted.
The party politburo meeting held on June 26 also disagreed with the project.
The CPM-led Left Democratic Front (LDF) State Government in Kerala has been objecting to the TOTEX (total expenditure) model put forward by the Centre. This key stipulation forced the government to express dissent, though it was not totally against the project per se.
Kerala had initially drawn up a plan to install 37 lakh smart meters in the State. But several trade unions in the power sector, including the CITU, and a section of CPM leaders, had opposed the project.
Bone of contention
As per the project norms, the contracting company would install and maintain the meter at its own expense and recover the amount in instalments from the customers.
The CPM completely rejects this model. The party's assessment is that the conditions imposed in the name of the smart meter project in Kerala are aimed at aiding private monopolies.
It also pointed out that several of the Central Government directives to the state, which took steps including that for reducing transmission losses, are against its interests.
Minister backs project
In July, Electricity Minister K Krishnankutty wrote to the Centre seeking three months time following the objection of the CPM Politburo.
Krishnankutty is of the view that abandoning the project will be a major setback, and the uncertainty should be resolved as soon as possible.
Minister even explored an alternative following the opposition. However, a week ago, the Union Ministry of Power asked Kerala to implement the TOTEX model.
As per the minister's request, a meeting has been convened on August 25 in the presence of the chief minister to discuss the future course of action.
The deadline to install smart meters as per the scheme is December 31, 2025. States which implement the scheme will be extended a Rs 9,000 crore central grant.
The Government of India scheme "aims to reduce the Aggregate Technical & Commercial (AT&C) losses" in power distribution "to pan-India levels of 12-15% and Average Cost of Supply (ACS)-Average Revenue Realised (ARR) gap to zero by 2024-25."