Section 177 in Regular Licence under Haryana Electricity Regulatory Reforms Act
177.
The designers of the reform program recognised this problem and set in place in the Act strict limitations to pursue unfunded subsides. The Act recognises that it is a legitimate policy function of Government of Haryana to decide that certain consumers should not have to pay the full cost of their electricity service. However, in such cases, the law does require that Government of Haryana fully compensate the licensees for the resulting revenue shortfall. The Act also provides for the ultimate elimination of cross-subsidies (overcharging some consumers to keep the utility financially indifferent for undercharging other consumers). The licences reflect this approach to subsides and tariff distortions. Considering the nature and role of the licence, the details of implementing these principles is left to subsidiary guidance documents. However, it appears that some of the criticisms or proposals for the draft licences do not indicate an appreciation of this situation.
