After a decade of losses, power DISCOMs return to profit

RK News
Comments 0
19 Jan 2026

New Delhi, Jan 18: After years of persistent financial stress, the country’s power distribution utilities have recorded a landmark turnaround, posting a collective Profit After Tax (PAT) of Rs 2,701 crore in the financial year 2024–25. The achievement marks a decisive break from a long history of losses that followed the unbundling and corporatisation of State Electricity Boards. As per a statement, the positive PAT in FY 2024–25 stands in sharp contrast to a loss of Rs 25,553 crore in FY 2023–24 and an even steeper loss of Rs 67,962 crore in FY 2013–14, signalling a structural improvement in the health of the distribution sector. Union Minister of Power Manohar Lal described the development as the beginning of a new chapter for power distribution in India, attributing the turnaround to a series of sustained reforms aimed at addressing long-standing operational and financial challenges faced by DISCOMs. He said the transformation reflects the leadership and vision of Prime Minister Shri Narendra Modi, recalling the Prime Minister’s emphasis that India is driving not only its own growth but also contributing to global growth, with the energy sector playing a pivotal role. Manohar Lal reaffirmed the government’s commitment to continuing reforms to ensure the power sector supports the country’s expanding economy and its journey towards a Viksit Bharat. The revival of the distribution sector has been driven by a range of targeted initiatives. These include the Revamped Distribution Sector Scheme (RDSS), which focuses on improving financial viability through infrastructure modernisation and accelerated smart metering, and the introduction of additional prudential norms linking access to finance with performance benchmarks to promote fiscal and operational discipline. Amendments to the Electricity Rules have strengthened timely cost adjustments, ensured prudent tariff structures and improved transparency in subsidy accounting to enable full cost recovery. The Electricity Distribution (Accounts and Additional Disclosure) Rules, 2025 have introduced uniform accounting practices and enhanced financial transparency across utilities, while the Electricity (Late Payment Surcharge) Rules have enforced payment discipline and reduced stress across the power value chain, supporting investment in new renewable energy projects. States have also been incentivised to implement critical power sector reforms, with additional borrowing limits linked to performance metrics under the Additional Borrowing Scheme.