India’s power distribution utilities (DISCOMs and power departments) have collectively recorded a positive Profit After Tax (PAT) of Rs 2,701 crore in year FY 2024-25, the first in over a decade.
Manohar
Lal, Union Minister of Power said that this marks a new chapter for the distribution sector and is a result of several steps that have been taken to redress the concerns of the distribution sector.
The distribution utilities as a whole reported a positive PAT of Rs 2,701 crore in FY 2024-25 compared to a loss of Rs 25,553 crore in FY 2023-24 and a loss of Rs 67,962 crore in FY 2013-14. It comes after the distribution utilities as a whole have been reporting PAT losses for past several years since the unbundling and corporatization of State Electricity Boards.
The government’s initiatives, including Revamped Distribution Sector Scheme (RDSS), Amendments to Electricity Rules, Late Payment Surcharge Rules, and Electricity Distribution (Accounts and Additional Disclosure) Rules, 2025, have played a pivotal role in transforming distribution utilities from loss-making to profitable ones.
The result of these reforms is evident not just in the positive PAT posted by the Distribution Utilities after so many years, but also in other performance indicators.
The Aggregate Technical & Commercial (AT&C) losses have reduced over the years, from 22.62% in FY 2013-14 to 15.04% in FY 2024-25.
Further, signalling much improved cost recovery, the Average Cost of Supply–Average Revenue Realized (ACS–ARR) gap has narrowed from Rs 0.78/kWh in FY 2013-14 to Rs 0.06/kWh in FY 2024-25.
Reforms such as the Electricity (Late Payment Surcharge) Rules have led to a 96% reduction in outstanding dues to generating companies—from Rs 1,39,947 crore in 2022 to just Rs 4,927 crore by January 2026—while bringing down Distribution utility payment cycles from 178 days in FY 2020-21 to 113 days in FY 2024-25.
