India is gearing up for the Union Budget 2026, and one of the most anticipated proposals is the Electricity Amendment Bill, likely to be introduced in the February session of Parliament. This legislation promises to reshape the power sector, bring financial stability to debt-laden distribution companies (discoms), and modernize electricity governance across the country.
Here’s everything you need to know in a quick, digestible listicle format:
1. electricity Amendment Bill: What’s the Buzz?
Union Power minister Manohar Lal Khattar announced that the long-awaited electricity Amendment Bill is expected to be tabled in the upcoming Budget session. The goal is to overhaul the sector and strengthen financial health of discoms while modernizing regulations.
Where it was announced: During the inauguration of the IIT delhi CERC Grid india Centre of Excellence.
2. Discoms Turn the Corner: Profits After Years of Losses
For the first time in many years, indian distribution utilities collectively posted a profit of ₹2,701 crore in FY25.
- Despite the gains, nearly 50 discoms still operate in the red.
- The amendment aims to ensure timely payments and prevent losses for these utilities.
Quote: Lal said, “In the next Budget session, we are bringing amendments to the electricity Act so that discoms don't face losses and receive timely payments.”
3. Federal Balance & State Consultations
The government is consulting state representatives before finalizing the Bill.
- The proposed legislation is designed to maintain federal balance and encourage cooperative governance.
- It will boost competition and improve efficiency in the power sector.
- Amendments are also expected to enhance financial discipline within distribution networks.
4. What the Bill Will Address
Key objectives of the electricity Amendment Bill 2025:
Prevent recurring losses for distribution companies.
Encourage timely payments from consumers and other utilities.
Strengthen mechanisms to solve long-standing sector challenges.
Foster competition by allowing multiple licensees to operate efficiently.
5. Opposition Concerns: Is Privatisation Around the Corner?
The proposed amendments have sparked criticism from groups like the All india Power Engineers Federation (AIPEF).
- AIPEF warns that the Bill may pave the way for privatisation of discoms.
- Multiple licensees could be allowed to use government-owned networks, which some see as a step toward corporatisation.
Quote: AIPEF Chairman Shailendra Dubey said, “The bill seems to support privatisation motives. The central government continues to press ahead with its privatisation agenda through the electricity (Amendment) Rules.”
6. Financial Stability & Efficiency: The Big Picture
The amendment is not just about regulations — it’s about financial stability, modernisation, and efficiency:
- Encouraging better governance across distribution networks.
- Ensuring discoms remain profitable and self-sustaining.
- Strengthening consumer protection mechanisms while opening doors to competition.
7. What to Expect in Union Budget 2026
- Introduction of the Electricity Amendment Bill in the February 2026 session.
- Possible policy incentives for states and utilities to modernize grids.
- Greater focus on public-private cooperation while addressing losses.
Bottom line: The amendment aims to future-proof India’s power sector, but debate over privatisation vs. public control is likely to continue.
✅ Takeaway: The electricity Amendment Bill in Union Budget 2026 could reshape how power is distributed in India, bringing profits back to struggling discoms, introducing competition, and modernizing governance — all while keeping an eye on financial discipline.
Disclaimer:
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency, organization, employer, or company. All information provided is for general informational purposes only. While every effort has been made to ensure accuracy, we make no representations or warranties of any kind, express or implied, about the completeness, reliability, or suitability of the information contained herein. Readers are advised to verify facts and seek professional advice where necessary. Any reliance placed on such information is strictly at the reader’s own risk.
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