Survival of discoms is questionable now: PowerMin to state govts

Lack of timely payment, especially from the other government departments in the state, is one major reason crimping the payment ability of discoms

The Union Ministry of Power has raised questions on the viability of state-owned power distribution companies (discoms) and their mounting loss-and-debt spiral. Even if discoms were to have a tariff hike every year, they would still find it difficult to service their debt obligations, observed the ministry.

This comes at a time when a new Revamped Distribution Sector Scheme for discoms is underway and the Electricity (Amendment) Bill, 2022, has suggested sweeping changes to the power distribution sector.

“Tariff hike year-on year is imminent, but would only suffice to maintain business-as-usual for discoms. Notwith­standing several initiatives by the Government of India, the