Lok Sabha Question No. 2283 (UNSTARRED), answered on 2026-02-12
Subject: Draft National Electricity Policy, 2026
Ministry: POWER
Asked by: Shri Anand Bhadauria

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA UNSTARRED QUESTION NO.2283 ANSWERED ON 12.02.2026

## DRAFT NATIONAL ELECTRICITY POLICY, 2026

2283.  SHRI ANAND BHADAURIA:

Will the Minister of POWER be pleased to state:

- (a) whether  Draft  National  Electricity  Policy  (NEP)  2026,  released  by  Ministry  in January  2026,  aims  at  replacing  the  2005  framework  with  a  focus  on  deregulation, financial viability of Distribution Companies (DISCOMs) and renewable energy;
- (b) if so, the details thereof along with other salient features of NEP 2026;
- (c) whether provisions in NEP 2020 would adversely affect the poor consumers of electricity in urban and rural areas;
- (d) if so, the details thereof; and
- (e) the corrective steps proposed by the Government in this regard?

## A N S W E R

THE MINISTER OF STATE IN THE MINISTRY OF POWER (SHRI SHRIPAD NAIK)

(a) & (b) : A Draft National Electricity Policy, 2026 (NEP 2026) has been prepared by the Ministry of Power and circulated for stakeholder consultation on 20.01.2026. The draft Policy is intended to replace the existing National Electricity Policy, 2005. Draft NEP 2026 lays out strategies for achieving the vision of providing reliable 24x7 quality power  through  a  financially  viable  and  environmentally  sustainable  power  sector furthering energy security at an affordable price.

Draft  NEP  2026  sets  out  clear  goals  and  objectives  inter  alia  for  achieving financial turnaround and commercial viability of the electricity sector, increasing the share  of  non-fossil  fuel-based  capacity  in  line  with  India's  Nationally  Determined Contribution  (NDC)  targets,  promoting  competition  in  electricity  supply,  and  market development facilitating deregulation of the power sector. The salient features of the draft NEP 2026 is included in Annexure.

(c) to (e):   There is no NEP 2020 notified by Ministry of Power. However, draft NEP 2026 does  not  contain  any  provision  which  would  adversely  affect  poor  consumers  of electricity  in  urban  or  rural  areas.  Draft  NEP  2026  outlines  provisions  for  ensuring adequate  availability  of  power  with  reliable  and  quality  supply  to  meet  both  peak demand  and  overall  energy  requirements;  and  enabling  supply  of  electricity  at competitive prices to support the vision of Viksit Bharat @ 2047, which will benefit all the consumers including low-income consumers in rural and urban areas. The interests of low-income consumers would be addressed through appropriate regulatory frameworks determined by State Electricity Regulatory Commissions and the subsidy payment by the respective State Governments in accordance with the provisions of the Electricity Act, 2003.

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## ANNEXURE REFERRED IN REPLY TO PARTS (a) & (b) OF UNSTARRED QUESTION NO. 2283 ANSWERED IN THE LOK SABHA ON 12.02.2026 *************

## Salient features of the draft National Electricity Policy, 2026

1. Resource Adequacy (RA): To ensure required capacity expansion through decentralized  advance  planning,  DISCOMs  and  SLDCs  shall  prepare  RA  plans  at utility and state levels, in accordance with the regulations of State Commissions.  CEA will prepare a corresponding national plan to ensure adequacy at the national level.
2. Financial Viability & Economic Competitiveness:
3.  Tariffs  must  be  linked  to  a  suitable  index  for  automatic  annual  revision  which operates if no tariff order is passed by the State Commission.
4.  Tariffs should progressively recover fixed costs through demand charges to avoid cross-subsidisation  between  the  tariff  components  as  well  as  among  various categories of consumers.
5.  Exemption of cross-subsidies and surcharges on manufacturing industry, railways and metro railways to increase the economic competitiveness of Indian goods and reduce logistics cost.
6.  Regulatory  Commissions,  in  consultation  with  Appropriate  Governments,  may exempt the distribution licensees from the Universal Service Obligation in respect of consumers having a contracted load of 1 MW and above.
7.  Strengthening  of  dispute  resolution  mechanism  to  reduce  burden  on  Regulatory Commissions,  enable  faster  dispute  resolution  and  reduce  financial  burden  on consumers.
3. Renewable Energy Generation & Storage:
9.  RE capacity addition through market-based mechanisms and captive power plants.
10.  Installation of storage by distribution licensee on behalf of small consumers to get benefit  of  economies  of  scale  and  by  bulk  consumers  themselves  to  facilitate adoption of Distributed Renewable Energy (DRE) sources.
11.  Trading of surplus energy from DRE as well as storage by consumers themselves (P2P) or through aggregators.
12.  Parity between RE and conventional sources in scheduling and deviation by 2030.
13.  Market-based  deployment  of  storage,  use  of  emerging  Battery  Energy  Storage System (BESS) technologies, domestic manufacturing of cells and other components of BESS and demand side incentives like VGF for BESS and pumped storage projects.
4. Thermal Generation:
15.  Integration  of  storage,  and  repurposing  of  older  units  for  grid  support  to  enable greater renewable energy integration.
16.  Exploring possibility of direct utilization of the steam generated from thermal plants for  applications  such  as  district  cooling  or  industrial  processes  for  optimum utilization.
5. Nuclear Generation:
18.  In  line  with  the  provisions  of  SHANTI  Act,  2025,  adoption  of  advanced  nuclear technologies, developing Modular Reactors, setting up Small Reactors, and use of nuclear energy by commercial and industrial consumers to achieve 100 GW by 2047.
6. Hydro Generation:
20.  Accelerated development of storage-based hydroelectric projects for flood moderation, irrigation, and water as well as energy security.
7. Power Markets:
22.  A strong regulatory framework for market monitoring and surveillance to prevent collusion, gaming, or market dominance.
8. Transmission:
24.  Adoption of latest technologies and suitable compensation for land use  to address Right of Way (RoW) challenges.
25.  Parity of transmission tariff with conventional power by 2030 for all types of new RE capacity.
26.  Utilization-based framework for allocation of transmission connectivity, along with appropriate regulatory mechanisms to ensure optimal use and prevent speculative holding of connectivity.
9. Distribution:
28.  Measures to achieve single-digit AT&C losses.
29.  Shared  distribution  networks  to  enhance  competition  and      efficiency,  while eliminating the requirement of duplication of network.
30.  Establishment  of  a  Distribution  System  Operator  (DSO)  to  facilitate  sharing  of network and integration of distributed renewables, storage, Vehicle-to-Grid (V2G) systems.
31.  N-1 redundancy at distribution transformer level in all cities with population more than 10 lakh by 2032. Such cities to be considered for undergrounding of distribution network in congested areas.

10. Grid Operations:

-  Functional  unbundling  of  State  Transmission  Utilities  (STUs)  and  creation  of independent  state-level  entities  to  manage  SLDC  operations  and  transmission planning functions.
-  Alignment of State Grid Codes with Indian Electricity Grid Code specified by CERC.

11. Cybersecurity:

-  Establishment of Robust cybersecurity framework.
-  Mandatory storage of power sector data within India to ensure data sovereignty and system resilience.

12. Data Sharing:

-  Sharing  of      operational  and  market  data  under  a  framework  prescribed  by  the Central Government.
-  Ensuring real-time visibility of Distributed Energy Resources to DISCOMs and SLDCs.

13. Technology & Skill Development:

-  Transition to indigenously developed SCADA system by 2030.
-  Development of domestic software solution for all critical applications in the power system.

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