DISCOMs
After years in red, India’s power DISCOMs finally turn profitable. Know all details
India’s power distribution utilities (DISCOMs and power departments) have collectively recorded a positive Profit After Tax (PAT) of ₹2,701 crore in FY 2024–25, marking a significant turnaround for the sector after years of sustained losses.
The distribution segment had consistently reported net losses since the unbundling and corporatisation of State Electricity Boards. The turnaround in FY 2024–25 contrasts sharply with a loss of ₹25,553 crore in FY 2023–24 and a much larger loss of ₹67,962 crore in FY 2013–14.
Commenting on the development, Union Minister of Power Manohar Lal said the milestone marks a “new chapter” for the power distribution sector and reflects the impact of sustained reforms aimed at addressing long-standing structural challenges.
The minister credited the achievement to the leadership and vision of Prime Minister Narendra Modi, quoting him as saying:
“India is driving not only its growth but also the growth of the world, with the energy sector playing a significant role in this.”
Manohar Lal said the government remains committed to further reforms to ensure the power sector supports India’s growing economy and contributes to the goal of Viksit Bharat.
Improved performance indicators
Beyond the return to profitability, key operational indicators also point to a broader transformation in the distribution sector.
Aggregate Technical and Commercial (AT&C) losses have steadily declined from 22.62% in FY 2013–14 to 15.04% in FY 2024–25, reflecting improved efficiency and loss reduction measures.
Cost recovery has also strengthened, with the Average Cost of Supply–Average Revenue Realised (ACS–ARR) gap narrowing sharply from Rs. 0.78 per kWh in FY 2013–14 to Rs. 0.06 per kWh in FY 2024–25.
Additionally, reforms such as the Electricity (Late Payment Surcharge) Rules have resulted in a 96% reduction in outstanding dues to power generating companies, from Rs. 1.39 lakh crore in 2022 to Rs. 4,927 crore by January 2026.
These measures have also improved payment discipline, reducing the average payment cycle of distribution utilities from 178 days in FY 2020–21 to 113 days in FY 2024–25.
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