Union Budget 2025: Initiatives That Can Make India Self-Reliant In Energy

To rationalize the use of petroleum products, they should be put under GST

- Kirit Parikh

Energy security requires that we promote renewables to replace coal in power generation and also promote electric vehicles as much as possible and cut down the use of fossil fuels.

In doing these, two issues need to be addressed. Many of the power distribution companies (discoms) make significant losses. The reason is large AT&C losses (short for aggregate transmission and distribution and commercial losses, an euphemism for power theft). For example, in 2022-23, they were 22.33% in Uttar Pradesh, 21.85% in Odisha, 20.55% in Madhya Pradesh, and 19.04% in Maharashtra. Many initiatives by the central government, including the latest revamped distribution sector scheme (RDSS) promising money for reducing AT&C losses, have not worked as expected. Also, most discoms are state-owned and have inadequate incentives for efficiency. The free power promised by various political parties compounds the problem. Privatization of discoms would be a solution but it is not acceptable to most state governments.

Reducing AT&C losses We need a measure that incentivizes the employees of discoms to reduce AT&C losses.