Thiruvananthapuram: The Kerala Assembly on Wednesday unanimously passed a resolution urging the Centre to withdraw the proposed Electricity Amendment Bill, 2021.
"A major clause in the proposed amendment is the non-requirement of license to operate in the power distribution sector," the resolution moved by power minister K Krishnankutty said.
"This will allow the free entry of private players into the sector with the state government or the Electricity Regulatory Commission having no control over them," it said.
The Assembly resolution noted that fundamentals would be provided to these private players on a platter.
"There is no obligation on these private players to invest in anything, including in the laying of new electricity lines. They will be authorised to carry and sell power along the existing transmission lines," the resolution said.
It then served a warning. "Since such private players are allowed to come in without having to invest in asset creation and power generation, it will be easy for them to wind up operations when profits plummet," it said.
"The amendment could, therefore, lead to uncertainty in the power distribution sector," it added.
Even after the amendment, the resolution said the responsibility to construct new lines, and their maintenance, would still be that of the public utilities alone.
The resolution said that the amendment did not impose upon the private players even the basic obligation of providing power to all.
"The amendment will create an opportunity for these private companies to concentrate their activities in urban areas and take away high-end users like commercial and industrial consumers from state utilities," it said.
"As a consequence, the private sector will take over the lucrative areas leaving the public utility to shoulder the burden of providing subsidised power to the poor and rural areas. When profits flow to the private companies and debts mount on public utilities, it will lead to the destruction of the public sector which would eventually result in the denial of power to the poor," it added.
What's more, the resolution said that the amendment would undermine federal principles.
"Even when the Centre had intervened in the power sector, power distribution had always remained with the states. The right of states to take decisions was protected even when there were privatisation pressures," the resolution said.
"However, the new amendment would take away even such powers and would vest the entire control of the power sector with the centre," the resolution said.