In a bid to correct the lopsided power tariff structure, the Centre on Tuesday said all the states had agreed to bring down cross-subsidies and rebalance the tariff.
The Union Power Minister Anant Geete, speaking to reporters on the sidelines of a national seminar on Electricity Act-2003, in New Delhi, however, assured that the rebalancing exercise would not affect the domestic tariff structure.
Asked whether the states have agreed to the Centre's proposal, Geete said, "Yes, we are in dialogue with all of them and the state regulatory commissions are working towards this."
The government proposes to introduce amendments to the electricity legislation during the current session of Parliament, he said.
The amendments would pertain to the role of the appellate body being set up for hearing petitions against judgements and orders of the Central Electricity Regulatory Commission and the state electricity regulatory commissions.
Addressing the seminar organised by the Federation of Indian Chambers of Commerce and Industry, Geete observed that there was a difference of one rupee between the cost incurred to produce a unit of power and the amount recovered.
Geete said around 45 per cent of the population was still living without power and even the remaining sections were not getting electricity for 24 hours.
He stressed the need for private sector participation to bridge the gap, while stating that the new legislation provides for decentralised generation and distribution activities to touch the remote corners of the country.
The minister said the targets for capacity addition during the eighth and ninth Plan could not be met and therefore government had decided to rely on the public sector during the 10th and 11th Five-Year Plans.
Targets for capacity additions have been set at 41,000 mw and 59,000 mw, respectively during the 10th and 11th Plans.
The Plans envisaged maximum reliance on the central sector followed by the state and private sectors towards achieving the goal of power for all by 2012.
Power secretary R V Shahi said the Centre would bring about a series of policies during the next few months on the issues like rural electrification and electricity tariffs.
Guidelines on multi distribution licences would also be announced during the course of the year focusing on net worth, credit worthiness and code of conduct for players.
Seeking to allay fears over the uncertainty of tariffs, he said regulators would formulate multi-year tariffs and subsidies would be brought down gradually.
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