General powers of the State Government

(1) The State Government shall have the power to issue policy directives on matters concerning electricity in the State including the overall planning and co-ordination : Provided that such policy directives shall be consistent with the objectives sought to be achieved by this Act and accordingly shall not adversely affect or interfere with the functions and powers of the Commission including but not limited to the determination of the structure of tariffs for supply of electricity to various classes of consumers :

Provided further that if the State Government requires the grant of any subsidy to any consumer or class of consumers in the tariff determined by the Commission under Part VIII, the State Government shall pay the amount to compensate the person affected by the grant of subsidy in the manner the Commission may direct, as a condition for the licensee or any other person concerned to implement the subsidy provided for by the State.

Provided also that the commission shall determine the amount payable by the State Government under the second proviso and the terms and conditions and time within which such amount has to be paid to implement the State Government’s stated policy for specified consumers or class of consumers.

(2) The State Government shall consult the Commission in relation to any legislative proposals enacted affecting the electricity sector and shall duly take into account the recommendation, if any, given by the Commission within such reasonable time.