Loss of 90 thousand crores estimated to power distribution companies

Most of the power distribution companies (discoms) in India are making losses every year and are estimated to have a total loss of Rs 90,000 crore in FY21.

In a report released by NITI Aayog, it has been estimated that due to successive losses, they are unable to make timely payments to the power producers, do not make the necessary investments to ensure better power supply or Unable to prepare to make better use of various renewable energy.

NITI Aayog has released a report today, in which it has been told about such reforms, which will transform the electricity distribution sector of the country. This report is an initiative to improve policy-making in this power distribution sector.

The report, titled Turning Around the Power Distribution Sector, has been jointly prepared by NITI Aayog, RMI and RMI India. It is noteworthy that RMI India works in the field of clean energy economy in India and it is affiliated to Rocky Mountain Institute (RMI) of America. This report was released by Dr. Rajiv Kumar, Vice Chairman, NITI Aayog.
The report reviews the reform efforts in the electricity distribution sector of India and the world. It incorporates best practices and lessons learned from policy experiences in the country. Dr. Rajiv Kumar, Vice Chairman, NITI Aayog said, the report examined several important reforms, such as the role of the private sector in distribution, procurement of power, regulatory status, integration of renewable energy and infrastructure upgradation. He said that a strong and efficient distribution sector is essential, be it to improve ease of doing business or to make life easier.
On this occasion, Dr. VK Saraswat, Member, NITI Aayog said, “This report has given a complete list of reform options for the policy-makers, so that they can bring the power distribution sector on the right track and make it profitable. NITI Aayog will partner with some states to implement these reforms.