The Energy Regulation and Markets Review - Stikeman Elliott

India
charge of nuclear energy. The Electricity Act 2003 is the primary statute that governs
generation, transmission, distribution and trading of electricity. The Electricity Act
provides, inter alia, for the formulation of the National Electricity Policy (formulated
in 2005), the Tariff Policy (formulated in 2006), establishment of independent
electricity regulatory commissions at the central level (the Central Electricity Regulatory
Commission (‘the CERC’)) and state level (the state Electricity Regulatory Commissions
(‘SERCs’)) and the setting up of the Appellate Tribunal for Electricity. The relevant
SERCs exercise jurisdiction over intrastate electricity regulatory matters (including
tariffs), whereas the CERC exercises jurisdiction over all interstate electricity regulatory
issues (also including tariffs).
Along with the Department of Atomic Energy, nuclear energy in India is regulated
by the Atomic Energy Regulatory Board, set up under the Atomic Energy Act 1954. The
government is also in the process of setting up a statutory, independent and autonomous
Nuclear Safety Regulatory Authority.
The Ministry of Coal administers all issues in relation to coal. In the last few
months, due to a shortage in coal availability, there has been immense lobbying on the
part of power producers for assured coal supplies by the government. Amidst this, the
setting up of an independent coal regulator for allocating coal blocks and regulating coal
prices is being deliberated upon. The draft Independent Coal Regulatory Authority Bill
2012 is pending consideration.
The Ministry of Petroleum and Natural Gas (‘the MoPNG’) deals with issues
relating to petroleum, natural gas, coal bed methane, shale gas and other petroleum
products. Along with exploration and production, the MoPNG also monitors its supply,
distribution, marketing and pricing. The Oilfields (Regulation and Development) Act
1948 and Petroleum and Natural Gas Rules 1959 provide the regulatory framework for
domestic exploration and production of oil and gas. The Petroleum Act 1934 controls
issues in relation to import, transport, storage, production, refining and blending of
petroleum.
The Directorate General of Hydrocarbons (‘the DGH’) is the upstream regulatory
body in charge of issues relating to exploration and production of oil and gas. Since
the DGH is an entity under the administrative control of the MoPNG, there has been
discussion recently of constituting an independent upstream regulator. The Petroleum
and Natural Gas Regulatory Board (‘the PNGRB’), constituted under the Petroleum and
Natural Gas Regulatory Board Act 2006, is the midstream and downstream regulator.
The PNGRB regulates the refining, storage, transportation, distribution, marketing and
sale of petroleum, petroleum products and natural gas.
ii Regulated activities
Electricity generation, including captive generation, is a delicensed activity. 4 While
generation activities can be freely undertaken without a licence, approvals and procedure
4 Hydropower projects that exceed the capital cost notified by the Government need concurrence
of the Central Electricity Authority.
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