Niti report cautions on discom delicensing, separation of content and carriage

NEW DELHI: Delicensing of discoms (distribution companies) to give consumers freedom to choose their power supplier by separating content and carriage, a key objective of the Electricity (Amendment) Bill 2021, may not necessarily yield all the attributed benefits unless tariff, regulatory and market reforms are carried out simultaneously, says a report by the government’s policy think-tank Niti Ayog on Tuesday.

“Delicensing distribution can introduce competition and enable retail choice for customers… implementing retail choice through separation of content and carriage may not necessarily result in the full set of theoretical benefits touted… the feasibility of competition will depend on the size of the market, the nature of the demand, the efficiency of the incumbent, potential for growth, etc,”