CCI denied to scan fixation of Electricity Tariffs and open access charges, case against Discoms closed

Competition Commission of India (CCI):  CCI maintaining distance from the jurisdiction of electricity sector regulators State Electricity Regulatory Commissions (SERCs) denied to examine fixation of electricity tariffs under the provisions of S. 4 of the Competition Act, 2002. The informant association alleged abuse of dominance position by Tata Power Delhi, BSES Rajasthani Power, BSES Yamuna Power, Punjab State Power Corp, Haryana Bijali Vitaran Nigam and HP State Electricity Board by imposing unfair and discriminatory conditions and by influencing and making unreasonable suggestions to respective SERCs for increasing various charges for “Open Access” and the tariff for power. Informant alleged that by continuously increasing cross subsidy, Open Access charges the consumers have been constantly prevented from utilizing the feature of Open Access, and thereby cheaper power and it have resulted in denial of market access to the members of the Informant, creation of entry barriers and foreclosure of competition.

CCI opined on the jurisdiction issue that that there is no overlap in the jurisdictions exercisable by it and the SERCs. It said that sectoral regulators (here SERCs) focus on the dynamics of specific sectors, whereas the it has a holistic approach and focuses on functioning of the markets by way of increasing efficiency through competition. The roles played by the CCI and the sectoral regulators are complementary and supplementary to each other as they share the common objective of obtaining maximum benefit for the consumers.

CCI, to further examine the matter, made references to SERCs of Punjab, Haryana, Delhi and Himachal Pradesh on the central issue agitated by the Informant i.e. increase in Open Access charges. After considering replies of the SERCs and the provisions of Electricity Act, 2003, CCI observed that scheme of the Electricity Act and the regulatory architecture provided thereunder, makes is abundantly clear that the charges for Open Access are to be decided by the respective SERCs. The concerned State Electricity Regulator and the Appellate Authority in terms of the statutory architecture governing the regulation of open access and determination of the relevant tariffs thereto would deal any issue in this regard. It also noted that matters pertaining to this issue are already pending before the Appellate Tribunal for Electricity (APTEL) and the Supreme Court.

CCI ordered for closing the case observing that the issue highlighted by the Informant in the present case is essentially related to the regulatory functions discharged by the State Regulatory Commissions in respect of fixation of tariffs. No competition issue is involved in the factual matrix disclosed in the information. [In re: Open Access Users Association and Tata Power Delhi Distribution,  [2015] CCI 146decided on 29.09.2015]

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