(1) The Central Government may notify any Central Government company as the Central Transmission Utility:
Provided that the Central Transmission Utility shall not engage in the business of generation of electricity or trading in electricity.
(2) The functions of the Central Transmission Utility shall be—
(a) to undertake transmission of electricity through inter-State transmission system;
(b) to discharge all functions of planning and co-ordination relating to inter-State transmission system with State Transmission Utilities, Central Government, State Governments, generating companies, Regional Power Committees, Authority, licensees and any other person;
(c) to ensure development of an efficient, co-ordinated and economical system of inter-State transmission lines for smooth flow of electricity from generating stations to the load centres;
(d) to provide non-discriminatory open access to its transmission system for use by—
(i) any licensee or generating company on payment of the transmission charges; or
(ii) any consumer as and when such open access is provided by the State Commission under sub-section (2) of section 42, on payment of the transmission charges and a surcharge assessed by the Central Commission.
Legal Commentary & Landmark Judgments: Section 38
Section 38 of the Electricity Act, 2003 designates the Central Transmission Utility (CTU) and establishes its statutory functions, including the provision of non-discriminatory open access to the inter-state transmission system.
This statutory framework establishes clear operational guidelines, balancing legal compliance with procedural safeguards.
Section 38 transformed inter-state power transmission from a closed monopolistic system into an open-access common carrier network. Generating stations (including renewable energy developers) possess a statutory right to wheel power across state borders to commercial buyers without interference from state transmission authorities.