Chapter IV Chapter IV

Powers of the State Government

1. (1) The State Government shall have the power to issue policy directives on matters concerning electricity in the State including the overall planning and coordination and all such policy directives shall be consistent with the objects sought to be achieved by this Act.
2. (2) If any dispute arises between the Commission and the State Government as to whether a question is or is not a question of policy, it shall be referred to the Central Electricity Authority whose decision thereon shall be final and binding and for this purpose the Central Electricity Authority may appoint one or more of its members to act on behalf of the said authority.
3. (3) The State Government shall be entitled to issue policy directives, concerning the subsidies to be allowed for supply of electricity to any class or classes of persons or in respect of any area in addition to the subsidies permitted by the Commission while regulating and approving the tariff structure: Provided that the State Government shall pay the amount to compensate any concerned body or unit affected by the grant of subsidies by the State Government to the extent the subsidies granted.