India is advancing a nationwide overhaul of its power distribution network under the Revamped Distribution Sector Scheme (RDSS), a programme with an outlay of Rs 3,03,758 crore and estimated Gross Budgetary Support from the Central Government of Rs 97,631 crore, aimed at improving the quality, reliability and financial sustainability of electricity supply.
Launched in July 2021, RDSS focuses on strengthening distribution infrastructure and deploying smart metering systems to enhance operational efficiency across utilities.
Projects worth Rs 1.53 lakh crore for loss-reduction infrastructure and Rs 1.31 lakh crore for smart metering works have already been sanctioned under the scheme.
“Government of India launched the Revamped Distribution Sector Scheme in July 2021 with the objective of improving the quality and reliability of power supply to consumers through a financially sustainable and operationally efficient distribution sector. The scheme has an outlay of Rs 3,03,758 crore and estimated Gross Budgetary Support from the Central Government of Rs 97,631 crore,” Minister of State in the Ministry of Power Shripad Naik said in a written reply to a question in the Rajya Sabha.
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Early outcomes suggest measurable progress in improving the financial health of distribution companies.
Aggregate Technical and Commercial losses at the national level declined from 21.91 per cent in FY21 to 15.04 per cent in FY25, while the ACS-ARR gap narrowed from Rs 0.69 per kWh to Rs 0.06 per kWh over the same period, according to the minister.
Funding under the scheme has been linked to operational and financial performance, a mechanism intended to enforce discipline in subsidy payments, tariff revisions and accounting practices.
Up to January 2026, funds amounting to Rs 38,803 crore had been released in line with scheme guidelines.
Smart metering remains a central pillar of the reform effort.
Works covering 19.79 crore consumers, 2.05 lakh feeders and 52.53 lakh distribution transformers have been sanctioned under Advanced Metering Infrastructure.
So far, smart meters have been installed for 4.04 crore consumers, 1.63 lakh feeders and 13.57 lakh distribution transformers, taking the overall installed base across schemes to 5.59 crore meters nationwide, according to the minister.
Beyond metering, the scheme includes replacement of old conductors, augmentation of substations and feeder segregation to curb technical losses.
On-grid electrification has also been sanctioned for 13,65,139 households, including those from Particularly Vulnerable Tribal Groups, Scheduled Castes and border areas.
Technology-led grid management is being expanded through the implementation of SCADA and Distribution Management Systems in 394 towns, enabling remote monitoring, faster fault detection and improved outage response.
Overall physical progress of loss-reduction works stands at about 37 per cent, indicating that while execution is underway at scale, a significant portion of the transformation remains in the pipeline.
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