Understanding the commission’s establishment, statutory authority and powers is essential to determining what options the state government has in the ongoing dispute.
What Is the Haryana Electricity Regulatory Commission?
The Haryana Electricity Regulatory Commission (HERC), like regulatory commissions in other states, was established on August 17, 1998, under the provisions of the Haryana Electricity Reform Act, 1997. It was constituted as an independent statutory body and also operates under the Electricity Act, 2003.
The commission was established under the Haryana Electricity Reform Act, 1997 (Act No. 10 of 1998), passed by the Haryana Legislative Assembly. It consists of a chairperson and two members.
How Are the Chairperson and Members Appointed?
The chairperson and members are appointed by the state government on the recommendations of a special selection committee.
Candidates for the chairperson’s post may include serving or retired High Court judges. Other members are required to have specialised knowledge and experience in law, accounting, economics, commerce, industry or administration.
Appointments are made according to prescribed rules. No person can be appointed as a member after the age of 62, ensuring that the appointee can serve a tenure of at least three years.
The chairperson and members cannot hold any other office of profit, occupy a position associated with a political party, or continue to engage in any business or profession.
What Are the Commission’s Main Functions?
The HERC’s primary responsibility is to determine electricity tariffs. It also establishes rules and conditions for power companies and issues licences for electricity-related activities.
The commission is responsible for protecting consumer interests and improving regulations governing electricity supply. It also advises the state government on matters concerning the energy sector.
Is the Haryana Government Bound by HERC’s Decision?
The commission’s decision to grant a parallel electricity distribution licence to a private company has triggered a major dispute over the respective powers of the regulator and the state government.
Under Section 14 of the Electricity Act, 2003, the HERC has the authority to grant parallel electricity distribution licences to private companies independently, even if the state government does not support the proposal.
As an independent, quasi-judicial statutory body operating under the central electricity law, the commission can consider applications submitted directly by private companies or other eligible entities seeking electricity distribution licences. It can take a decision on such applications without requiring formal consent or an invitation from the state government.
The Haryana government, however, maintains that it did not invite applications for privatisation. It has said it will challenge the HERC decision before the Electricity Appellate Tribunal and seek a stay on the order.
Energy Minister Anil Vij and Chief Minister Nayab Singh Saini have indicated that the state government intends to challenge the decision under the provisions of the Electricity Act, 2003. The government’s position is that the matter should be contested through the prescribed legal process rather than through an indefinite employees’ strike.
INLD Questions the Government’s Intentions
INLD leader Sampat Singh has alleged that the HERC’s decision to grant a contract to Eleven Power Limited was taken at the government’s direction and with its consent.
“The contract that the Haryana Electricity Regulatory Commission has given to Eleven Power Limited was awarded at the government’s instructions. The decision was taken with the government’s consent. This is, in a way, an attack on electricity consumers,” Singh said.
He accused the government of hiding behind the commission’s decision while the energy minister publicly opposed it.
“The Energy Minister is talking about opposing the decision, even though he himself is the Power Minister. But he is a powerless minister,” Singh said.
He further alleged that the government had not opposed the company’s licence application when it was submitted to the HERC.
“They should explain what opposition they made, on which date they appeared, and whether any minister or official attended the hearings. None of their officials attended; their lawyers did. I attended every hearing,” Singh said.
Singh claimed that his party had strongly opposed the company’s licence because it believed the move would undermine the existing electricity distribution corporations, adversely affect poorer consumers and jeopardise employees’ futures.
INLD Also Targets Congress Over Its Opposition to the Licence
Singh argued that the government’s description of the arrangement as a parallel licence did not change what he considers its underlying nature as privatisation.
He said power employees had appeared before the commission and opposed the proposal, but alleged that the government had failed to make its position known effectively during the proceedings.
“It has to be said that Mr Vij is not speaking the truth,” Singh said.
He also criticised Congress, saying that no Congress worker, MLA or Leader of the Opposition had opposed the licence before the HERC.
According to Singh, the opposition also had a responsibility to register its objections before the commission rather than criticise the government after the decision.
He questioned the financial capacity of the company that received the contract, claiming that it had a capital of Rs 1 crore while the government was assigning it work worth Rs 4,700 crore.
“The Union Power Minister Is Backing the Company”
Singh also raised questions about Eleven Power Limited’s ownership and experience in electricity distribution.
“I do not know who owns Eleven Power Limited. They also have no experience in this work. Under pressure from the Union Power Minister, the company has been given the work in Gurugram and Nuh districts. He has his hand over the company’s head,” Singh alleged.
He claimed that Adani’s company had also applied for the work but that its application was subsequently withdrawn. Singh further alleged that the withdrawal could not have happened without the involvement of Union Minister Manohar Lal.
According to Singh, the arrangement could result in the Dakshin Haryana Bijli Vitran Nigam losing approximately 43 per cent of its revenue.
These claims were made by Singh as part of his criticism of the licensing decision and the government’s handling of the dispute.
Sampat Singh Invokes Section 108 of the Electricity Act
Singh also suggested a legal route that he believes the Haryana government could explore to address the controversy.
“If Mr Vij regains his power, he can use a provision of the 2003 Act. Under Section 108 of the Electricity Act, 2003, the government can issue directions to the HERC on policy matters and in the public interest, in writing. Under this provision, the decision taken by the state government in the matter would be final,” Singh said.
Addressing the energy minister, Singh said he was pointing out the relevant legal provision after the minister had asked about the law governing the issue.
He offered to help the government in the matter but said he would not approach the tribunal himself. Singh expressed doubts about the likelihood of the tribunal reversing the commission’s decision, arguing that the proceedings had already taken place before the HERC.
He maintained that the state government could issue an advisory or direction under Section 108, stating that the decision did not serve public interest or fall within the government’s policy framework.
Singh argued that the government should use this provision to cancel the decision. He also announced that the INLD supported the electricity employees’ strike and stood with them.
Kumari Selja Questions the Government’s Coordination
Congress leader Kumari Selja also criticised the state government over its handling of the controversy.
“I was watching the statements coming from the government as well, saying that this was not right and that the government would appeal. It should be clear who is actually running the government,” she said.
Selja questioned how the government could publicly oppose a decision while the regulatory process had already resulted in the disputed licence.
“Think about how ridiculous this has become. The government does not know what its right hand is doing and what its left hand is doing. Is the government functioning or not? We are saying it is not functioning. They themselves do not know who is taking decisions. They also want to file an appeal,” she said.
When asked about the government’s argument that electricity distribution corporations are autonomous bodies and that the decision was theirs, Selja said such institutions were still part of the government’s broader administrative framework.
“They are also a part of the government; they are not outside it. They must be communicating with each other. The government will decide the policy. The court will also examine the law,” she said.
What Do Legal Experts Say?
Legal expert Ashish Goyal said the HERC had issued an order concerning the private distribution licence and that the commission was an independent statutory body established under central rules.
He said anyone challenging the order could approach the appropriate judicial authority or the High Court.
However, Goyal argued that disagreement with the decision did not justify employees going on strike.
“If anyone has a problem with this order, they should pursue the judicial route available under the rules. Going on strike is not the right course of action,” he said.
Goyal added that any action the state government intended to take under Rule 108 would have to be considered separately in accordance with the applicable provisions. He emphasised that the dispute should be pursued through the prescribed legal mechanisms rather than through a strike.
The controversy over electricity distribution in Gurugram and Nuh has therefore raised questions about the HERC’s licensing powers, the state government’s options under the Electricity Act, and the responsibilities of political parties and employees in challenging regulatory decisions.
The next developments will depend on the government’s proposed appeal before the Electricity Appellate Tribunal, its request for a stay on the commission’s order, and the steps taken to address the concerns of power employees and consumers. The legal process will be central to determining the future of the disputed distribution licence and the extent to which the state government can intervene.
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