Power sector limping back to normal; ensuring 24X7 power supply, discoms’ financial health key challenges

NEW DELHI: Limping back to normal after bearing the brunt of the pandemic this year, the power sector needs a slew of reforms, especially the implementation of consumer rules to achieve the government’s ambitious target of 24X7 electricity supply for all in 2021, and also steps to improve the financial health of discoms.

The most important task before the government will be to deal with the sickness of power distribution utilities (discoms), which are cash-strapped and unable to pay the electricity generation firms (gencos) for ensuring 24X7 power supply for all.

There has been a cascading effect of the pandemic on power demand and revenue collection of discoms, a scenario that has aggravated the stress on the already troubled gencos. There has been an issue with cash flow and finance of gencos due to delay in payments by discoms.