Electricity consumers face high costs due to cancelled long-term contracts and legal loopholes

Consumers are once again doomed to pay exorbitant rates for the electricity they consume as the long-term contracts of state electricity boards get canceled due to legal loopholes. Such anti-people actions are common when laws that harm consumers take precedence over their interests. Also, the reckless decisions of the Electricity Board and the Regulatory Commission which has control over it are going to become a shame for the consumers. The state has not been able to achieve self-sufficiency in the field of electricity till date. Every year during summer, electricity has to be bought from outside at exorbitant cost. In this way the board has to spend a huge amount of money. The board piles the excess money on the customers. This is how the surcharge becomes a permanent system along with the electricity bill.

Consumers are going to be left in the dark after the Electricity Appellate Tribunal yesterday quashed the long-term contract to buy electricity from four out-of-state companies at low prices. The Regulatory Commission had canceled four contracts signed with private companies during the Oommen Chandy government in May 2023. The action was pointed out that the contract was in violation of the central provisions related to the purchase of electricity. A total of 465 MW of electricity was being received from four companies. It was only later that the reality that the state would slip into a power crisis was realized if this was stopped. The government then asked the regulatory commission to reconsider its decision.

However, the companies were not ready to provide electricity again at the old rate of Rs 4.15. Moreover, the decision of the Regulatory Commission was challenged in the Appellate Tribunal. The Appellate Tribunal ruled that the Regulatory Commission was not bound to comply with the government's direction to restore the canceled contract. It should be questioned that the action taken by the government in the name of public interest is worthless. The government should approach the Supreme Court against the tribunal verdict. A way to get a stay against the execution of the judgment should also be looked into. In 2014, during the Oommen Chandy government, power purchase agreements were made for 25 years. Electricity, which was supposed to be available at the rate of Rs 4.15 per unit, was lost due to the reckless decision of the government and the regulatory commission.

The availability of low-cost electricity was a boon for the state, which was facing constant power shortages. After restoring the canceled contracts, the companies naturally refused to supply electricity at the old price. The demand of one of the companies was to pay more than 14 rupees per unit. Only one company has announced that it will provide electricity at the old price. This company also withdrew after incurring huge arrears in paying the price of electricity paid earlier. The electricity board, reeling under power crisis every summer, is still reluctant to turn to alternative means. Solar energy and hydropower generation can be used widely as an alternative. But there are no plans to maximize these. Instead of encouraging consumers to switch to solar energy, moves are being made to discourage them.