Power discoms recorded ₹2,701 crore profit in FY25, says Ministry

India's power distribution companies reported a consolidated profit in FY25 after years of losses, driven by lower AT&C losses, tariff reforms and improved payment discipline

The country’s power distribution companies (discoms), including both state-owned utilities and power departments, collectively recorded a profit after tax of ₹2,701 crore in 2024–25 (FY25), the power ministry said in a statement, calling it a significant turning point for the sector.

 

The discoms had registered a loss of ₹25,553 crore in the previous financial year (2023–24), and a loss of ₹67,962 crore a decade ago in 2013–14 (FY14). “This marks a new chapter for the distribution sector and is a result of several steps that have been taken to address the concerns of the distribution sector,” Power Minister Manohar Lal said, adding that the government is committed to power reforms.

   

The ministry also said that aggregate technical and commercial (AT&C) losses of discoms have fallen from 22.62 per cent in FY14 to 15.04 per cent in FY25, while the gap between the average cost of supply and the average revenue realised has narrowed from 78 paise per unit to 6 paise per unit over the same period.

 

“Reforms such as the Electricity (Late Payment Surcharge) Rules have led to a 96 per cent reduction in outstanding dues to generating companies, from ₹1.39 trillion in 2022 to ₹4,927 crore by January 2026, while bringing down distribution utility payment cycles from 178 days in 2020–21 to 113 days in FY25,” the ministry said.

 

The power ministry said that the government’s transformative initiatives in the distribution sector include the Revamped Distribution Sector Scheme for enhancing financial viability through infrastructure modernisation and accelerated smart metering, and additional prudential norms linking access to finance for power sector utilities to performance benchmarks to promote fiscal and operational discipline.

 

Other initiatives include amendments to the Electricity Rules to enforce timely cost adjustments, prudent tariff structures, and transparent subsidy accounting to ensure full cost recovery; and the Electricity Distribution (Accounts and Additional Disclosure) Rules, 2025, which introduce uniform accounting and enhanced transparency across distribution utilities for improved financial governance.