The Ministry of Power has proposed the Electricity (Rights of Consumers) Amendment Rules, 2026, to modernize the country’s power sector while ensuring stronger protection for electricity consumers. The draft rules were released on March 12, 2026, and focus on improving grid stability, integrating renewable energy into the system, simplifying consumer grievance mechanisms, and protecting users from unexpected billing errors.
One of the key features of the proposed rules is the formal introduction of “Demand Response.” This strategy is designed to manage electricity demand on the grid by encouraging consumers to shift their electricity usage to periods when power supply is higher or demand is lower. Consumers may be offered financial incentives to adjust their consumption patterns, helping utilities balance electricity demand and supply more effectively, especially as renewable energy sources such as solar power increase on the grid.
To support this system, the government has proposed the mandatory implementation of Time-of-Day (ToD) tariffs. Under this mechanism, electricity prices will vary depending on the time of day. Commercial and industrial consumers with electricity demand above 10 kW will be required to move to ToD tariffs by April 1, 2027. Most other consumers will transition to the system by April 1, 2028. The rules specify that electricity during “solar hours,” an eight-hour window determined by State Electricity Regulatory Commissions, will be at least 20 percent cheaper than normal rates. In contrast, electricity during peak demand hours will cost between 1.10 and 1.20 times the regular tariff.
The draft amendments also introduce measures to manage the growing number of “prosumers,” or consumers who both generate and use electricity, usually through rooftop solar installations. While net-metering will continue to be allowed, state commissions may impose certain charges for solar systems larger than 5 kW to cover network losses and storage-related costs. For large installations exceeding 500 kW, regulators may also require the integration of energy storage systems to help manage surplus electricity generated during periods of high solar production.
In addition to grid management reforms, the proposed rules aim to improve administrative efficiency in the electricity distribution sector. The timeline for providing new electricity connections will be significantly reduced. Distribution companies will be required to provide connections within three days in metropolitan areas, seven days in other municipal areas, and fifteen days in rural regions. In hilly and difficult terrains, including states such as Himachal Pradesh and union territories like Jammu and Kashmir, the maximum time allowed will be thirty days.
The amendments also propose reforms to the consumer grievance system. The existing Consumer Grievance Redressal Forum structure will be simplified into a two-tier mechanism consisting of a company-level forum and a district or municipality-level forum. This restructuring is intended to make dispute resolution faster and more consistent across different states.
To prevent sudden and unusually high electricity bills, the draft rules introduce an automatic bill review mechanism. If a consumer’s bill shows consumption five times higher or one-fifth lower than the average consumption of the previous six months, the distribution company must review the bill and resolve the issue within thirty days. During this review period, electricity supply cannot be disconnected as long as the consumer continues to pay based on their average past consumption.
The ministry has invited feedback from stakeholders and the public on the proposed rules until April 11, 2026. If approved, most of the provisions are expected to come into effect on October 1, 2026, marking a significant step toward a more consumer-friendly and technologically advanced electricity system in India.
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