Two or More Electricity Suppliers in Town?

You have the right to choose the better one

Ever wondered how long have you had an electricity connection? Well, in most cases, you do not even know. Most likely, ever since you have been conscious, you have known electricity, been part of discussions cribbing about the rising tariffs, inflated bills, load shedding and so on, and how those new digital meters bill you even for the little red indicators on switches. So, what else then?

The conversations continue to happen; ‘power’ has become a political agenda; and many of you forget that you are the ‘consumer’ of power companies and have every right to question them for inadequate services. Not the least of your rights is to be able to move to a better service provider in your area if there is an option. Yes, just like you can port your mobile number to another service provider after clearing all dues, you can change your electricity provider too.

In the recent past, there have been cases wherein power companies have objected to such switching of service providers. However, the highest courts of the country have stood by the consumers, rebuffed the monopolistic practices of some power companies, making way for consumers to choose what they believe is better for them.

A Local Battleground

In a landmark judgement on 8 May 2014, the Supreme Court (SC) upheld the rights of retail electricity consumers allowing them to choose the electricity supplier on the basis of their service quality and price.

The SC’s consumer-favoured judgement came in the case of Brihanmumbai Electric Supply & Transport Undertaking (BEST) versus Maharashtra Electricity Regulatory Commission (MERC) wherein BEST had challenged the MERC decision to allow a retail consumer to switch from BEST services to Tata Power.

The case began when Guru Prasad Shetty, a restaurant owner, realized that BEST, which was his electricity provider, was charging him almost double the rate of Tata Power. He decided to switch service provider and applied for a no-objection certificate (NOC) from BEST. BEST refused to give the NOC contending that they were a ‘local authority’ under the Electricity Act and hence nobody else could supply electricity to retail customers in their area.

Guru Prasad approached Maharashtra Electricity Regulatory Commission. The Commission stood by the consumer and directed BEST to issue an NOC to facilitate the switch. MERC also directed Tata Power Company (TPC) to create their own infrastructure in the area to provide electricity to aggrieved consumers.

BEST, however, refused to issue the NOC and also challenged the authority given to Tata Power at various levels including the Appellate Tribunal for Electricity and the Supreme Court.

The Appellate Tribunal took the consumers’ side and upheld the order of the MERC. BEST went to the Supreme Court with the following points:

a) The Regulatory Commission did not have jurisdiction to entertain a dispute between the consumer and a distribution licensee.

(b) Tata Power Company was not a deemed distribution licensee for the area in question and therefore was not entitled to give electricity connections to consumers in the area.

c) TPC could not extend its network in a BEST area of supply, without BEST’s consent and agreement.