Statement of All India Power Engineers federation (AIPEF)
The Electricity (Amendment) Bill will adversely affect farmers, domestic consumers and power sector employees. It will financially weaken public DISCOMs and increase electricity tariffs for farmers and domestic consumers which will threaten affordable and universal access to electricity. The Bill would amount to privatization of profits and socialization of losses.
ALL INDIA POWER ENGINEERS FEDERATION
Electricity (Amendment) Bill 2025 – Key Concerns
The proposed Electricity (Amendment) Bill 2025 poses serious risks to farmers, consumers, power sector employees, and the federal structure of the country. The Bill primarily promotes privatization of electricity distribution, weakens social protections in the power sector, and centralizes decision-making powers.
1. Impact on farmers
* Removal of cross-subsidy within five years will lead to a sharp increase in electricity tariffs for agricultural consumers.
* Farmers who currently receive subsidized electricity for irrigation will face higher power costs, increasing agricultural distress.
* Private distribution companies are unlikely to serve rural and low-revenue agricultural areas, affecting reliable supply to villages.
* Increased power tariffs may lead to higher cost of agricultural production, ultimately affecting food prices.
2. Impact on domestic consumers
* Allowing multiple distribution licensees in the same area will result in private companies choosing only high-paying consumers, leaving public DISCOMs with loss-making consumers.
* Gradual elimination of cross-subsidy will cause significant tariff increases for domestic consumers, particularly low-income households.
* Electricity may become market-driven rather than service-oriented, undermining universal access.
* Consumers in rural and remote areas may face reduced service quality and supply uncertainty.
3. Impact on power sector employees
* Backdoor privatization of distribution will lead to job insecurity for thousands of power sector employees and engineers.
* Experience from privatized utilities shows downsizing, contractual employment, and reduced service conditions.
* Public DISCOMs will be weakened financially as profitable consumers shift to private companies.
* Institutional knowledge and public sector capacity in the power sector will be systematically eroded.
4. Threat to federal structure
* Electricity is a Concurrent Subject under the Constitution, but the Bill increases central government control over state electricity policies.
* Creation of new central body National Electricity Council and expanded rule-making powers will reduce the autonomy of state governments.
* States may lose flexibility in determining tariffs, subsidies, and distribution policies according to local needs.
* This represents a shift from cooperative federalism to centralized control in the power sector.
5. Overall Risks
* Financial weakening of public DISCOMs.
* Increased electricity tariffs for farmers and domestic consumers.
* Privatization of profits and socialization of losses.
* Threat to affordable and universal electricity access.
Demand
* Immediate withdrawal of the Electricity (Amendment) Bill 2025.
* Protection of cross-subsidy and affordable electricity for farmers and domestic consumers.
* No privatization of power distribution through multiple licensees.
* Safeguarding the federal structure and powers of states in electricity governance.
* Meaningful consultation with power employees, engineers, farmers, and consumer organizations before any reforms.
Electricity must remain a public service ensuring affordable and reliable power for all citizens.