Lok Sabha Question No. 4422 (UNSTARRED), answered on 2026-03-19
Subject: Profit recorded by DISCOMs
Ministry: POWER
Asked by: Shri Rajesh Verma, Smt. Shambhavi, Shri Mukeshkumar Chandrakaant Dalal, Dr. Lata Wankhede, Shri Vishaldada Prakashbapu Patil

## GOVERNMENT OF INDIA MINISTRY OF POWER

## LOK SABHA

## UNSTARRED QUESTION NO.4422 ANSWERED ON 19.03.2026

## PROFIT RECORDED BY DISCOMS

## 4422.  SHRI VISHALDADA PRAKASHBAPU PATIL:

SMT. SHAMBHAVI:

SHRI RAJESH VERMA:

DR. LATA WANKHEDE:

SHRI MUKESHKUMAR CHANDRAKAANT DALAL:

Will the Minister of POWER be pleased to state:

- (a) the  total  profit  recorded  by  Distribution  Companies  (DISCOMs)  during  the Financial Year-2025 and the manner in which this reflects improvements in operational and financial performance;
- (b) the  key  factors  that  contributed  to  the  improved  profitability  of  DISCOMs including tariff reforms, loss reduction measures and efficiency enhancements;
- (c) whether targeted support from Government schemes incentives and performance  linked  initiatives  has  played  a  role  in  strengthening  the  finances  of DISCOMs, if so, the details thereof and if not, the reasons for the same;
- (d) the manner in which the Government monitors and supports DISCOMs to sustain positive financial outcomes while ensuring affordable power supply; and
- (e) whether these developments align with long term objectives of financial viability and reliable electricity delivery across all regions, if so, the details thereof and if not, the reasons for the same?

## A N S W E R

## THE MINISTER OF STATE IN THE MINISTRY OF POWER

(SHRI SHRIPAD NAIK)

- (a) to (e): Government of India (GoI) has been supporting the distribution utilities to improve their operational performance and financial viability through various initiatives. Some of the key initiatives taken are as under:
- (i)  Revamped Distribution Sector Scheme (RDSS) has been launched in the year 2021 with the objective of improving the quality and reliability of supply of power through a financially sustainable and operationally efficient distribution sector. Financial support is provided under the scheme for strengthening distribution infrastructure and smart metering works. The release of funds under this scheme for loss reduction works is contingent upon performance of the utilities against various operational and financial parameters. This has helped in timely release of subsidy and Government department dues to the utilities. It has also nudged the utilities for regular issuance of tariff orders, timely  publishing  of  accounts,  non-creation  of  regulatory  assets,  improve  billing  by reducing leakages and improve collection against energy billed.

……….2.

(ii)  Additional borrowing space of 0.5% of Gross State Domestic Product (GSDP) has been  made  available to State Governments,  which  is conditional  upon  them undertaking specific reforms in the power sector including financial performance of the distribution utilities.

(iii)   Additional Prudential Norms have been laid down for sanctioning of loans to Stateowned  power  utilities  based  on  performance  of  power  distribution  utilities  against prescribed conditions.

(iv) Rules for implementation of Fuel and Power Purchase Costs Adjustment (FPPCA) and cost-reflective tariff have been framed so as to ensure that all prudent costs for supply of electricity are passed through.

(v)      Rules  and  Standard  Operating  Procedure  have  been  issued  for  proper  subsidy accounting and their timely payment.

(vi)  To improve payment discipline in the power sector value chain, Electricity (Late Payment Surcharge and Related Matters) Rules, 2022 were promulgated, which entail obligations  upon  the  distribution  utilities  to  clear  their  legacy  dues  as  existing  on 03.06.2022 in a phased manner and time bound clearance of current dues.

With  concerted  efforts  of  Central  and  State  Governments,  the  Aggregate in FY21 to 15.04% in FY25 while the national Average Cost of Supply - Average Revenue collective efforts have also resulted in distribution utilities achieving a profit after tax

Technical and Commercial (AT&C) losses at national level have reduced from 21.91% Realized  (ACS-ARR)  gap  has  narrowed  from  Rs.  0.69/kWh  to  Rs.  0.06/kWh.  These (PAT) of   Rs. 2,701 crore for the first time.

************