Impact analysis of the shift of HT consumers from discom based purchase mode to open access in electricity in Punjab and Rajasthan
Student name: Ms Kaveri Ghosh
Guide: Mr Sheeraz Kirmani
Year of completion: 2012
Host Organisation: Indian Energy Exchange, New Delhi
Supervisor (Host Organisation): Mr Aman Singal
Abstract: The enactment of the Electricity Act 2003 has opened up the constrained electricity sector
characterized by long term Power Purchase Agreements and few suppliers, which left consumers
with practically no choice. The 2003 Act introduceda framework called Open Access, for
encouraging competition in the electricity sector and empowering consumers by providing them
with the right to choose their preferred service provider. The Act mandates non-discriminatory
open access to transmission and distribution networks to allow competing producers and
suppliers to sell electricity directly to end consumers, in this case bulk consumers with 1MW and
above consumption.
Since January 2009, open access regime has been ushered in as many as 20 states though on an
optional basis. Much depends on the state’s initiative as the various charges like cross subsidy
surcharge, wheeling charge and transmission tariff among others are determined by State
Electricity Regulatory Commissions. While, some states have shown reluctance others are at
various stages of opening up the sector.
The open access regime has been successful in most of the developed nations and has reached up
to the level of household consumers, providing them with the choice of selecting their preferred
electricity suppliers. Besides efficiency improvements and cost reduction, introduction of open
access would create a market that would help channelize private investment in the sector as the
producers would not be compelled to sell their produce to state electricity monopolies.
With this as the backdrop, the objective of the project was to analyse and understand the
implication of shift of bulk consumers eligible for Open Access to market purchase mode. Bulk
consumers eligible for Open Access, as per Central Electricity Regulatory Authority constitute
all 1MW and above consumers only. The states considered for study are Punjab and Rajasthan.
The analysis of various tariffs and surcharges indicate that Open Access is a win-win proposal
both for state bodies and the electricity market. A basic principle of open access is that carrier
and content should be separate.This study focuses upon the state distribution entities and their
revenue generation sources i.etariffs and surcharges to draw upon the final conclusion.
