Power Portability In Budget, Consumers Can Pick Distribution Company

People will have the option of changing their power supplier and more than one distribution company can operate in any area under a new scheme in Budget 2021. Finance Minister Nirmala Sitharaman ón Monday announced a New Power Distribution Sector Scheme to allow more than one power distribution company to provide services to consumers in a single area.

Currently, only one power distribution company or Discom can operate in a given area. But now consumers can enjoy portability.

Power Minister RK Singh told NDTV in an interview that just like in the telecom sector, power consumers can pick their electricity supplier.

"People do not have any option if the power distribution company is performing badly or there is too much load-shedding. There is no system of solving their complaint. We are bringing a system in which more than one company will operate in each area and whoever provides better service, people can opt for that," Mr Singh told NDTV.

"It's the same as for mobile services. When a mobile operator does not perform well, people have the option of switching to another service provider," the Power Minister explained.

A proposal has been prepared, he said, and will be placed before the cabinet after various ministries are consulted.

This is part of a Rs 3,05,984 crore electricity distribution reform programme to help reduce losses, end the monopoly of Discoms and improve their efficiency, according to the Budget announced by Finance Minister Nirmala Sitharaman yesterday.

"Distribution companies across the country are monopolies, either government or private. There is a need to provide choice to the consumers by promoting competition. A framework will be put in place to give consumers alternatives to choose from among more than one distribution company," Ms Sitharaman said.