India to Punish Officials of States with ‘Personal Penalties’

Drastic measures are being taken in order to prevent more major power outages in India this week. On 31 July, the northern grid collapsed, and on 1 August, in a wider blackout, the northern and eastern ones did so, leaving nearly 620 million people without electricity.

Reports have claimed that the blackouts were partly caused by power distributers overdrawing power. While there is a penalty for overdrawing power from the transmission grid known as an unscheduled interchange (UI), states prefer to pay this because it’s cheaper to do so than to buy power in the spot market. Additionally, these penalties are imposed on utilities and not on officials.

Because of this The Central Electricity Regulatory Commission (CERC), India’s apex power sector regulator, has taken drastic steps to prevent further power transmission failures, and plan to impose personal penalties on CEOs of power distributors that withdraw more than their allotted share of electricity.

The CERC has summoned the CEOs of the power distribution companies of Delhi, Uttar Pradesh, Punjab, Haryana, Rajasthan, Himachal Pradesh and Jammu and Kashmir. The power overdrawn by these states is in the range of 3-51% of the scheduled quota. Overdrawing by Uttar Pradesh has been as high as 43.32 million units (MU) per day. For Haryana and Punjab, this touched 27.83 MU and 18.33 MU per day, respectively, in the month of June 2012.

Pramod Deo, CERC chairman stated “we have called a meeting of the CEOs tomorrow. Imposing a penalty of Rs.1 lakh or Rs.1 crore means nothing for the utilities. We now plan to impose personal penalties on officials who head these overdrawing utilities. It will be a personal fine on them”.

Reports have not yet surfaced on what these ‘personal penalties’ will be.