Turning around the power distribution sector: learnings and best practices from reforms
NITI Aayog released a report that presents reform pathways that can transform the country’s power distribution sector, in a step towards improving policymaking in this area. The report, titled Turning Around the Power Distribution Sector, is co-authored by NITI Aayog, RMI and RMI India. Most power distribution companies (discoms) in India incur losses every year—total losses are estimated to be as high as Rs 90,000 crore in FY 2021. Due to these accumulated losses, discoms are unable to pay generators on time, make investments required to ensure high-quality power, or prepare for greater use of variable renewable energy. The report presents a review of reform efforts in the Indian and global power distribution sector. It extracts the learnings and best practices from the wealth of policy experience that exists in the country. ‘This report examines many important reforms, such as the role of the private sector in distribution, power procurement, regulatory oversight, integration of renewable energy, and upgradation of infrastructure.