Ziraat Times Exclusive

New Delhi: With the Union Power Ministry proposing a “power sector council” to address issues between the Union and state governments, Jammu & Kashmir’s power sector may see yet another major structural transformation.

Other proposals by the power ministry include separation of the wire and electricity supply business, setting up of a pan-India power distributor and building renewable energy management centres (REMCs) across India.

According to The Mint, government’s contention is that with power being on the concurrent list of the Indian Constitution, many sectoral issues get stuck due to differences between the Union and the state governments.

Jammu & Kashmir state and the union government have lately been locked in a tussle over the control and management of several hydropower projects in the state, which remain under the National HydroPower Corporation (NHPC). The extension of a pan-India distribution framework would mean that Grid Corporation of India may take over grid management and distribution of power completely in Jammu & Kashmir.

Currently, Power Development Department looks after the distribution part of power in J&K, while State Power Development Corporation (SPDC) is responsible for the production issues. With the creation of the “Power Council”, as the balance of power in management of these entities would shift, a major change in the existing roles and responsibilities of the state’s power sector entities could not be unexpected.

As of now, all of J&K’s power houses are now connected with the Northern Grid, with import and export regulated through a centralised load monitoring system. Although J&K state and the union government have been closely coordinating the production and distribution issues of power in J&K, experts believe that a Power Council could further erode the state’s say in the development and the management of the energy sector in Jammu & Kashmir.

According to  Mint, the proposed council will comprise ministers and bureaucrats at various levels and will be a forum for collective decision-making.

The council will help the Union and the state governments work on a common agenda and ensure round-the-clock power to all, a government official, who is part of the exercise, said on condition of anonymity.

“The need for coordination between the centre and states in the power sector has never been more critical. And this must be done in line with the GST Council, involving the finance ministers of states and the centre,” said Debasish Mishra, partner at Deloitte India.

The power ministry has also proposed limiting Power Finance Corp.’s and REC Ltd’s lending to state electricity distribution companies (discoms) except for capital expenditure projects, setting up public charging stations for electric vehicles and seeking the approval of the cabinet committee on economic affairs for pre-construction activities for the strategically important Dibang hydropower project in Arunachal Pradesh.

The proposed power council will be headed by the Union power minister and have the Union finance minister and power ministers of all states as members. It will be assisted by a standing committee headed by the Union power secretary, with finance secretaries, principal secretaries (energy) and principal secretaries (finance) of all states as its members.