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Wednesday, September 22, 2021

‘Discom loss surge to Rs 90,000 cr in FY21’

The report, co-authored by NITI Aayog and energy think tank RMI, recommended a host of measures, including providing greater autonomy to discoms, timely tariff revisions, increasing competition in the business and larger involvement of the private sector to improve the health of these perennially-distressed entities.

By: ENS Economic Bureau | New Delhi |
Updated: August 4, 2021 10:52:54 am
Union Power Minister RK Singh recently said discoms’ losses were down 38 per cent on-year at Rs 38,000 crore in FY20 (Representational image)

Losses of state-run power distribution companies (discoms) are estimated to have surged to Rs 90,000 crore in FY21, a report released by NITI Aayog on Tuesday.

Union Power Minister RK Singh recently said discoms’ losses were down 38 per cent on-year at Rs 38,000 crore in FY20, mainly due to corrective actions like timely tariff revisions and improvement in billing and collection efficiency. The losses were expected to have risen again in 2020-21, owing to the pandemic disrupting the reform process that induced a certain discipline among these entities.

The report, co-authored by NITI Aayog and energy think tank RMI, recommended a host of measures, including providing greater autonomy to discoms, timely tariff revisions, increasing competition in the business and larger involvement of the private sector to improve the health of these perennially-distressed entities.

“A robust and long-lasting solution to the woes of the discoms requires changes in policy as well as organisational, managerial, and technological reforms,” said Clay Stranger, managing director, RMI.

Experts have pointed that revenue of discoms may have significantly dropped in FY21 with demand from high-paying industrial and commercial consumer segments getting disrupted amid the lockdowns to contain the coronavirus. FE

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