Amid a political storm over Tata Power's application for a distribution licence in Goa, the Joint Electricity Regulatory Commission (JERC) on Monday clarified that the proposal does not involve privatisation or takeover of the State's electricity distribution system, but seeks to introduce a parallel distribution network that would allow consumers to choose between the two power services.
The Commission said the State Electricity Department will continue as the incumbent distribution licensee even if Tata Power is granted approval, with the private utility operating alongside it under the provisions of the Electricity Act, 2003.
The clarification assumes significance as Tata Power Company Ltd has formally applied to JERC for a distribution licence covering the entire State, triggering concerns and political allegations that Goa's power sector was being handed over to a private company.
Speaking to The Goan, JERC Research Officer Rajat said the proposal is at a preliminary stage and no decision has been taken on the application.
"It is not privatisation of the power sector or taking over the Electricity Department. The State Electricity Department will continue as the incumbent distribution licensee. If Tata Power is granted a licence, it will operate as a parallel licensee, giving consumers the option to choose between the two utilities," Rajat said.
He added that the Commission has sought compliance on certain issues from the applicant and the matter is still under examination.
"The matter is in the preliminary stage. Nothing has been finalised yet. It is premature to draw any conclusions at this point," he said.
JERC officials explained that Section 14 of the Electricity Act, 2003 empowers electricity regulators to grant licences to two or more distribution companies in the same geographical area, provided applicants satisfy prescribed conditions relating to capital adequacy, creditworthiness and other regulatory requirements. The law also states that an eligible applicant cannot be denied a licence merely because another distribution licensee already exists in the area.
According to JERC, the parallel licensing model is currently operational in Mumbai, where multiple distribution companies including Tata, serve consumers within the same city.
While the earlier provisions required every new licensee to establish its own distribution infrastructure, the latest amendment introduced in 2025 eliminates duplication of poles, wires and substations by allowing new distributors to use existing networks on payment of wheeling charges determined by the State Electricity Regulatory Commission.
Officials also emphasised that all distribution licensees, whether public or private, would continue to be bound by the universal service obligation, requiring them to supply electricity to all eligible consumers, including rural and domestic households, without discrimination. Subsidy mechanisms administered by the State Government would also remain unaffected.
