power sector
There is going to be a big change in the electricity distribution system in India. The central government has proposed to open the electricity retail market across the country to private companies. The draft bill prepared by the Union Power Ministry states that this will end the monopoly of power distribution companies (Discoms) owned by state governments and will also allow private companies to sell electricity directly to consumers.
Till now, electricity distribution has been privatized in only a few states in India such as Delhi-NCR, Odisha, Maharashtra and Gujarat. But in most of the states, electricity is supplied by government companies, which are continuously incurring losses. The ministry says that this reform will increase competition in the electricity distribution system, improve the quality of services and reduce the financial burden of the states.
Will get relief from electricity shortage
After the implementation of the draft bill, big private companies of the country like Adani Enterprises, Tata Power, Torrent Power and CESC will be able to enter the field of electricity distribution across the country. This will have a direct impact on consumers, as they will now have the option to choose better rates and service from multiple electricity providers in the same area.
The central government has been working for a long time towards reducing the losses of power distribution companies and modernizing the old infrastructure. Earlier this year, the country’s largest state Uttar Pradesh also started the process of handing over two of its four discom companies into private hands.
56000 crore dues of power sector
According to the September 2025 report of the Institute for Energy Economics and Financial Analysis, by June 2025 the state’s power distribution companies owe about $ 6.78 billion (about ₹ 56,000 crore) to power generating companies. Due to this, power producers are facing huge financial problems and there is shortage of cash in the entire power sector.
You will be able to get electricity from the company of your choice
Another major change in the draft bill is that now many private companies will be able to do electricity distribution work in the same area. There is no such permission in the current Electricity Act. The government believes that this reform will not only provide better facilities to the consumers, but will also encourage private investment.