POWERGRID can monetize its transmission line towers by offering it to mobile telecom service providers on commercial basis under section 41 of the Electricity Act, 2003, which allows for effective utilization of assets to benefit the society at large, a committee constituted by the Central Electricity Regulatory Commission (CERC) said in its recommendation.
The committee was mandated to investigate the technical and financial aspects of the proposal after POWERGRID filed a petition with the CERC to share its transmission infrastructure with telecom operators.
Telecom service providers are reluctant to establish telecom network in remote areas due to non-availability of electricity board power supply, difficulty to lease land, high maintenance costs, low revenue due to low population etc.
POWERGRID, in the petition has mentioned that majority of its 2,50,000 transmission line towers are in remote areas and the same could be used to improve the IT infrastructure in rural areas. This can help government of India’s flagship “Digital India” program.
The petition also cites the National Digital Communications Policy -2018 recommendation to reduce the carbon footprint by deploying solar power in place of running of diesel genset for more than 12 hours/day. It says-
“Department of Telecom has emphasized for leveraging existing assets of the broadcasting and power sector to improve connectivity, affordability and sustainability and facilitate the establishment of Mobile Tower Infrastructure by promoting and incentivizing deployment of solar and green energy for telecom towers.”
Therefore, it is an initiative to explore the possibility to offer a cost-effective solution by providing transmission infrastructure and reliable power to the telecom operators.
According to the CERC (sharing of revenue derived from utilization of transmission assets for other business) Regulations, 2007, POWERGRID is required to share the revenue derived from such business with the beneficiaries of ISTS.
The committee in its recommendation has suggested that in initial stages, sharing of revenue after meeting cost may be in the ratio of 50:50 with the beneficiaries. However, it may be reviewed after one year to ascertain the financial viability of the business by POWERGRID.
Many DISCOMs have also replied to the petition and expressed their concerns.
The Uttar Pradesh Power Corporation Ltd. (UPPCL) submitted that POWERGRID should ensure non- hindrance of transmission services due to frequent maintenance of mobile telecommunication equipment.
BSES Rajdhani Power Ltd in its submission said –
“PGCIL has proposed to supply power to telecom asset/ transmission system which would mean that PGCIL is indulging in the trading of electricity despite being a transmission licensee. As per Section 38 of the Electricity Act, PGCIL can only undertake the functions assigned to it under the Electricity Act i.e. transmission of electricity.”
It further added, “If PGCIL seeks to engage in trading/supply of electricity, it would require distribution licensee and distribution system which cannot be done under the current regulatory framework.”
However, the committee in its recommendation has observed that providing electricity by POWERGRID for the telecom equipment installed on its transmission towers out of the electricity which was otherwise wasted does not amount to ‘generation’ or ‘trading’ in electricity and thus the prohibition prescribed in Section 38 would not apply.
Comments are invited from the stakeholders by March 1, 2019.
Recently, Mercom reported that Leh and Kargil, two of India’s most difficult and inhospitable terrains, were connected to the national electricity grid after 72 years of independence. It was made possible by the PGCIL, a state-run transmission utility.
Image credit: Flickr
Nitin is a staff reporter at Mercomindia.com and writes on renewable energy and related sectors. Prior to Mercom, Nitin has worked for CNN IBN, India News, Agricultural Spectrum and Bureaucracy Today. He received his bachelor’s degree in Journalism & Communication from Manipal Institute of Communication at Manipal University and Master’s degree in International Relations from Jindal School of International Affairs. More articles from Nitin Kabeer