Supreme Court Questions Electricity Regulatory Commissions’ Functional Autonomy

• The Supreme Court expresses doubts about the independence and autonomy of Electricity Regulatory Commissions (ERCs).

• ERCs have exclusive authority for tariff determination and promote competition and reliable power supply.

• Electricity is a “public good” and a “material resource,” making it vulnerable to political posturing.

• The ERCs were intended to ensure electricity was sold and distributed for the common good, uninfluenced by politics and market forces.

• The court questioned the ERCs’ “functional autonomy” and the “manage and manoeuvre” tactics used to arrive at tariffs.

• The court ordered regulatory assets to not exceed the reasonable percentage as stipulated in the Electricity Rules and to be liquidated within seven years from April 1, 2024.