Electricity Act, 2003 and the emerging regulatory challenges

Abstract

The Electricity Act, 2003 promises to bring about competition and choice in the electricity industry in India. However, since the Electricity Act, 2003 does not mandate any particular market design, there is considerable risk of state electricity regulatory commissions implementing different market structures in their respective states as per their own priorities and preferences. Such action is fraught with dangers and can severely limit consumer choice. A common market design evolved through a process of consensus among policy-makers and regulators can obviate such risks to a great extent.