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India Drafts Power Law to Open Retail Electricity to Private Suppliers

The proposal targets chronic discom losses by pairing market competition with stronger regulatory controls.

Overview

  • The draft Electricity (Amendment) Bill, 2025 would allow multiple distribution licensees to serve the same area and supply over shared or private networks subject to regulatory approval.
  • Industries could procure power directly through expanded open access, with state regulators able to exempt licensees from universal service obligations for eligible consumers and designate a fallback supplier at a premium to ensure continuity.
  • A National Electricity Council led by the Union power minister is proposed, alongside new disciplinary provisions for CERC and SERC members to address wilful violations or failure to discharge duties.
  • The bill empowers regulators to promote trading platforms and new market products such as specific-delivery contracts for difference, and enables enforceable non-fossil energy obligations under the Act.
  • State-run discom stress is cited as the driver, with cumulative losses of about ₹6.9 lakh crore and dues to generators near $6.78 billion, while implementation will hinge on state governments and regulators that resisted similar 2022 reforms.