Advancements and Reforms in India’s Power Sector: Insights from the Sector Review Meeting

Representational image. Credit: Canva

In a two-day Review Planning & Monitoring (RPM) meeting held on July 10th and 11th, 2023, in New Delhi, key stakeholders of India’s power sector convened under the leadership of Shri R. K. Singh, Union Minister of Power and New & Renewable Energy (MNRE). The meeting included Shri Krishan Pal Gurjar, Minister of State for Power, officials from the Government of India, State Power Utilities, and representatives from Central Public Sector Enterprises (CPSEs).


During the meeting, Shri R.K. Singh highlighted the remarkable transformation in India’s power sector over the past 7-8 years. He cited the addition of 185 GW of capacity, shifting the country from power deficit to power surplus. Singh also emphasized the establishment of a unified grid capable of transferring 1,12,000 MW across the nation. Furthermore, significant improvements were achieved in the distribution system, with the construction of substations, upgrading of infrastructure, and the addition of transmission lines and transformers. These efforts have resulted in increased power availability in rural and urban areas.

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Singh expressed satisfaction with the implementation of reform measures by most State/DISCOMs, as prescribed by the Ministry of Power under initiatives like the Revamped Distribution Sector Scheme (RDSS) and Additional Prudential Norms. Notably, losses in Aggregate Technical and Commercial (AT&C) areas have reduced from approximately 22% to 16.5%, while the gap between Average Cost of Supply (ACS) and Average Revenue Realization (ARR) has narrowed to 15 paise per unit from 69 paise per unit.


The meeting also addressed recent reforms in the power sector, including renewable generation obligations, resource adequacy planning, and rationalization of open access charges. Singh stressed the importance of tariffs reflecting costs accurately and being kept up to date. He recommended that Regulatory Commissions adopt realistic loss reduction trajectories to ensure the viability of DISCOMs. States were advised to adopt a Multi-year Tariff regime going forward and ensure correct subsidy accounting and timely payment by DISCOMs and State Governments, respectively.

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The status of progress under the RDSS scheme was presented by the Nodal Agencies, REC and PFC, with most participating DISCOMs on track for funding eligibility. DISCOMs were encouraged to expedite implementation and maintain the quality of works under the scheme.

In conclusion, Shri R. K. Singh expressed satisfaction with the performance of the power sector and expressed confidence that continued efforts would lead to further improvements in the quality and reliability of power supply, ultimately enhancing the quality of life for all citizens.

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