The total loss of DISCOMs in India, ₹ 73,684 crore in the financial year 2020-21, MoP annual report
The power sector is an essential component of the Indian economy, and the distribution companies (DISCOMs) play a crucial role in ensuring the supply of electricity to end consumers. However, DISCOMs in India have been facing severe financial losses, which has been a major challenge for the power sector. In this article, we will discuss the status of losses of DISCOMs and summarize the annual losses of DISCOMs using data from the Ministry of Power annual report.
According to the Ministry of Power annual report for 2021-22, the total loss of DISCOMs in India was ₹ 73,684 crore in the financial year 2020-21. This is a significant improvement from the previous year, where the total loss was ₹ 61,360 crore. However, these losses still highlight the financial challenges faced by DISCOMs in India.
The report also reveals that most states have seen an improvement in their financial position, with 26 states and union territories reporting a reduction in their losses. However, seven states and union territories still reported losses of over ₹ 1,000 crore. These states are Uttar Pradesh, Bihar, Jharkhand, West Bengal, Maharashtra, Tamil Nadu, and Delhi.
Uttar Pradesh, which is the most populated state in India, had the highest losses among all states at ₹ 12,331 crore. This was followed by Bihar, which reported losses of ₹ 6,292 crore, and Jharkhand, which reported losses of ₹ 5,329 crore. These losses are due to a variety of factors such as high transmission and distribution losses, inadequate tariff revisions, and inefficient operations.
On the other hand, some states have managed to improve their financial position significantly. Gujarat, for example, reported a profit of ₹ 1,200 crore, which is a remarkable turnaround from the loss of ₹ 3,200 crore reported in the previous year. Similarly, Andhra Pradesh, which reported a loss of ₹ 4,000 crore in the previous year, managed to reduce its losses to ₹ 1,300 crore.
The report also highlights the progress made under the Ujwal DISCOM Assurance Yojana (UDAY) scheme, which was launched in 2015 to address the financial challenges faced by DISCOMs. Under this scheme, DISCOMs were given financial assistance, and state governments were required to take steps to improve the operational efficiency of DISCOMs. The scheme has helped to reduce the financial losses of DISCOMs and improve their operational efficiency.
In conclusion, the financial losses of DISCOMs continue to be a significant challenge for the power sector in India. While some states have managed to improve their financial position, others are still struggling to reduce their losses. The implementation of schemes like UDAY has been helpful, but more needs to be done to improve the financial viability of DISCOMs.