Union Minister of State for Power and New & Renewable Energy, Shri Shripad Yesso Naik, chaired the fourth meeting of the Group of Ministers formed to address issues related to the financial health and viability of power distribution utilities. The meeting took place in Vijayawada and was attended by energy ministers from four states—Uttar Pradesh, Andhra Pradesh, Rajasthan, and Maharashtra—as well as senior representatives from the All India DISCOM Association, central and state government officials, and executives from Power Finance Corporation Ltd.
In his welcome address, Shri Naik thanked the Energy Minister of Andhra Pradesh for hosting the meeting. He spoke about the challenges discussed in earlier meetings of the Group and emphasized the need for regulatory reforms to improve the functioning of distribution companies, or DISCOMs. The Minister also highlighted the key action points identified in the previous meetings, focusing on improving efficiency and sustainability in the power distribution sector. He said both the State Governments and the Regulatory Commissions have a shared responsibility to make the distribution sector financially and operationally sound.
The Energy Minister of Andhra Pradesh expressed his appreciation to the Union Minister of State for bringing the meeting to Vijayawada. He acknowledged the importance of the Group’s discussions in shaping the future of power distribution.
The All India DISCOMs Association invited as a special participant, gave a detailed presentation. It stressed the need for State Electricity Regulatory Commissions to follow the Tariff Policy and associated rules while setting electricity tariffs. The presentation also pointed out the need to revise the current Tariff Policy to better match the present-day requirements and challenges faced by utilities and consumers.
A presentation from the Ministry of Power’s Joint Secretary (Distribution) provided insights into the financial condition of utilities in the participating states. It showed that in many cases, the yearly revenue increase of utilities does not match the rise in debt they are taking on. The presentation also explained the proposed action plan to cut down outstanding debts and losses in the distribution sector.
Key topics of discussion during the meeting included the need for cost-reflective tariffs, timely payment of subsidies by State Governments, and clearing dues owed by various government departments. Participants also spoke about speeding up work under the Revamped Distribution Sector Scheme, especially smart metering projects, and using Artificial Intelligence and Data Analytics for better power purchase and demand forecasting.
States requested the central government’s support in further reforming the distribution sector, suggesting steps like involving distribution franchisees, privatization efforts, or introducing parallel licensees to promote competition and efficiency. There was also a recommendation to hold a special session on reducing power purchase costs by involving all stakeholders.
At the end of the meeting, member states agreed that the Group of Ministers should continue its work beyond the submission of its final report. They proposed that future sessions be hosted by different states on a rotating basis. The ministers expressed a strong commitment to finding solutions that will improve the financial health of power distribution utilities and strengthen the overall electricity sector in India.
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