Former Sebi chief Ajay Tyagi to head panel on ending monopolies in gas transmission and marketing

Oil regulator has formed a committee nether erstwhile Sebi president Ajay Tyagi to urge ways of ending monopolies enjoyed by companies engaged successful some proscription and selling of earthy state and metropolis state retailing.

The eight-member committee has been asked to springiness its recommendations connected splitting entities engaged successful some proscription and selling of earthy gas, and ending the monopolies of metropolis state retailers wherever required, the Petroleum and Natural Gas Regulatory Board (PNGRB) said successful an order.

The sheet has been asked to taxable its study successful 3 months.

In mature markets, vigor infrastructure is operated connected a communal bearer rule that gives entree to 3rd parties. Any idiosyncratic oregon supplier could entree immoderate state pipeline, irrespective of who owns it.

But that is not the lawsuit successful India with users and suppliers often complaining of not getting access.

The authorities had a fewer years backmost considered splitting state-owned state inferior GAIL (India) Ltd by hiving disconnected its pipeline concern into a abstracted entity and selling it disconnected to strategical investors.

This is due to the fact that GAIL owns much than two-thirds of the country's pipeline networking, getting it a stranglehold connected the market. GAIL is besides the country's biggest earthy state selling steadfast and users often complained astir not getting entree to the company's pipeline web to transport their ain fuel.

To resoluteness the struggle arising retired of the aforesaid entity owing the 2 jobs of proscription arsenic good arsenic selling of gas, bifurcating GAIL was considered. But that program was dropped without immoderate explanation.

Parallely, metropolis state operators person monopolies successful proviso of CNG to automobiles and piped earthy state to household kitchens for cooking successful respective cities. Third parties bash not person entree to their web of pipelines if they privation to proviso the fuel.

Now PNGRB has constituted the committee to beforehand contention and supply a level-playing tract successful state transmission and organisation businesses.

In its September 10 order, the regulator said the PNGRB Act of 2006 mandates it to guarantee separation of activities related to earthy state selling and proscription including ownership of the pipeline successful lawsuit an entity engages successful some selling of earthy state and laying and operating pipelines.

PNGRB said its regulations authorities that "if an entity is engaged successful some selling of earthy state and laying, building, operating oregon expanding pipelines for proscription of earthy gas, it shall, connected oregon earlier March 31, 2017, make a abstracted ineligible entity truthful that the enactment of proscription of earthy state is carried connected by specified abstracted ineligible entity and the close of archetypal usage shall beryllium disposable to the affiliate of specified abstracted ineligible entity." However, this nonsubjective has not been achieved, it said.

In addition, ending the exclusivity of metropolis state licences was important for opening up the state marketplace but the regulator faced hurdles to state a licence country arsenic communal bearer upon expiration of fixed exclusivity.

"The declaration of geographical areas arsenic communal bearer oregon declaration bearer is indispensable for ushering successful just contention and ratio successful the metropolis state organisation sector, which whitethorn payment the extremity consumer," PNGRB said.

PNGRB said it is constituting an adept committee nether Tyagi, who had antecedently dealt with state issues erstwhile helium worked arsenic a elder bucrearact successful the Ministry of Petroleum and Natural Gas.

The different members of the committee see A K Purwaha, erstwhile president of Engineers India Ltd, Shaleen Sharma, erstwhile caput of BG India, and Sanjay Sah of Deloitte.

"The superior nonsubjective of the committee is to analyse planetary practices concerning the separation of proscription and selling activities including ownership of the pipeline successful the earthy state sector, measure the existent concern successful India, and urge suitable measures to guarantee effectual implementation of separation of proscription and selling activities successful the earthy state sector," it said.

The sheet has been asked to supply a "possible exemplary for separation of proscription and selling activities successful the earthy state assemblage including ownership of the pipeline." It would besides "provide actionable recommendations for revising the exclusivity model successful the metropolis state organisation (CGD) sector" and "suggest measures to code ineligible challenges and guarantee a just and competitory market".

The committee would besides suggest "pathways for geographical areas wherever exclusivity for laying, gathering oregon enlargement of the CGD web has ended".