Big Power Reforms: Government Eyes Stock Listings For Five Firms, Mulls Facilitation Of State-Owned Discom Privatisation

The government has reportedly identified five state-owned power generation and transmission companies for stock market listing, aiming to attract investments for their capacity expansion.

According to a Financial Express report, Power Secretary Pankaj Agarwal stated that Andhra Pradesh Power Generation Corporation and Gujarat Energy Transmission Corporation are among the five companies that are in the process of appointing merchant bankers.

The government is also considering facilitating privatisation of state-run distribution companies (discoms), which struggle to raise tariffs despite challenges like rising power procurement costs, high T&D losses, and payment delays from consumers.

During a regional meeting recently, states sought the Centre’s support in privatising distribution utilities to enhance service efficiency and reliability.

A ministerial group has been formed to address discoms' financial concerns, but a financial bailout is not on the table, according to the power secretary.

The government is also evaluating the possibility of listing certain discoms on stock exchanges, provided they cut their accumulated losses.

As per official data, discoms' total losses stood at Rs 6.92 trillion in 2023-24, with outstanding debt reaching Rs 7.53 trillion by the fiscal year's end.

While states have improved subsidy payments to discoms and the gap between the average cost of supply (ACS) and average revenue realised (ARR) has narrowed from 45 paise per kWh in 2022-23 to 19 paise in 2023-24, some pending government dues remain.

By January 2025, the ACS-ARR gap had further reduced to 0.10 paise per kWh.

Also Read: Indian Scientists Develop Innovative Method To Enhance Stability Of Perovskite Nanocrystals For Next-Gen Lighting