India’s power distribution utilities have recorded a consolidated Profit After Tax of Rs 2,701 crore in FY 2024-25, marking a major turnaround for a sector that has reported losses for more than a decade. The milestone comes after a loss of Rs 25,553 crore in FY 2023-24 and Rs 67,962 crore in FY 2013-14, according to a release issued by the Ministry of Power.
Commenting on the development, Union Power Minister Manohar Lal said the results mark the beginning of a new chapter for the distribution sector and reflect sustained efforts to address long-standing structural and financial challenges. He attributed the turnaround to a series of reforms aimed at improving operational discipline, transparency, and cost recovery across distribution utilities.
The Minister said the progress aligns with the broader vision of Prime Minister Narendra Modi, noting that the energy sector is playing a central role in supporting India’s economic growth and its long-term goal of becoming a Viksit Bharat. He added that the government remains committed to deepening reforms so the power sector can reliably support a growing economy.
Over the past decade, the Ministry of Power has rolled out multiple initiatives to restore the financial health of distribution utilities. These include the Revamped Distribution Sector Scheme focused on infrastructure upgrades and smart metering, stricter prudential norms linking financing to performance benchmarks, amendments to electricity rules to ensure timely tariff revisions and transparent subsidy accounting, and the introduction of uniform accounting and disclosure standards in 2025. Measures such as the Late Payment Surcharge Rules have also strengthened payment discipline across the power value chain.
The impact of these reforms is visible across key performance indicators. Aggregate Technical and Commercial losses have declined from 22.62 per cent in FY 2013-14 to 15.04 per cent in FY 2024-25. The Average Cost of Supply-Average Revenue Realised gap has narrowed sharply from Rs 0.78 per kilowatt-hour to Rs 0.06 per kilowatt-hour over the same period, indicating near full cost recovery. Outstanding dues to generating companies have fallen by 96 per cent, from Rs 1,39,947 crore in 2022 to Rs 4,927 crore by January 2026, while average payment cycles have reduced from 178 days in FY 2020-21 to 113 days in FY 2024-25.
