The Telegraph
Since 1st March, 1999
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Power reforms on fast track

New Delhi, Nov. 24: The government is planning to set up a National Energy Institute to make India self sufficient in power.

More incentives will be doled out in line with the provisions of the Electricity Act 2003 to encourage private sector participation in power generation and transmission.

. K. Singh, member of the Planning Commission, described the Electricity Act 2003 as a “watershed” for power sector reforms in India. He said there had been a fundamental progress made in reforming the power sector by deregulating distribution.

He said more private players were applying to become power generators, which was a testimony to the fact that there have been significant reforms at the distribution level.

“More efforts will be made to attract private participation in the power sector. There are enough provisions in the Electricity Act that will help to attract the private sector,” said Singh.

Speaking at the session on “Energy: Its Unexploited Potential”, at the India Economic Summit, jointly organised by the Confederation of Indian Industry (CII) and the World Economic Forum (WEF), Singh said, “It is very important that issues regarding distribution are given the necessary thrust and more efforts in developing power markets.”

Singh also stressed the need to provide appropriate infrastructure to develop power markets in India. He said there could be no second opinion that India required an integrated fuel policy.

However, Singh said that there were several unresolved issues in hydrocarbon.

He stressed on the need for strengthening of regulatory framework and exploring various alternative source of power.

Singh said that power trading could provide a mechanism for leveraging investment and added that the value added by power trading and power markets need to be brought out. This process, he said, has to be linked to the reform programme and given the time required for the process. There is a need for short, medium and long-term solutions.

Chandra P. Jain, chairman and managing director of National Power Thermal Corporation, said over the last few years, there had been sustained reforms in the areas of delicensing of power generation and the enactment of the Electricity Bill 2003. Jain, however, said that in order to sustain reforms, it was essential to have predictability, uniformity and accountability.

Jain said that affordability has to be a balanced concept from the point of view of a consumer and the investor. He said consumer interest should have to be looked at in a much broader perspective.

Surya Sethi, advisor (energy), Planning Commission, said the pace of reforms had been good considering the economic and social constraints. He said power sector reforms could not be seen in isolation but had to be seen in the context of overall reforms on the economic and social fronts.

He urged the energy sector to become competitive, as otherwise reforms will not take off.

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