A draft bill from India’s federal power ministry indicates a plan to open the country’s retail electricity market to private companies nationwide. This proposed measure aims to end the predominant control of state-run distributors in most states.
The initiative could enable private entities, including Adani Enterprises, Tata Power, Torrent Power, and CESC, to expand their operations across India. This development follows a similar attempt in 2022 that encountered opposition from state distribution companies. A significant number of these state-controlled utilities are currently experiencing substantial financial losses. The New Delhi government has been urging state-run power utilities to mitigate these losses, improve their financial standing, and modernize aging infrastructure.
Earlier this year, Uttar Pradesh, India’s most populous state, sought bids for the privatization of two of its four power distribution companies. According to the Institute for Energy Economics and Financial Analysis, state power utilities owed power generators approximately $6.78 billion as of June 2025, which has led to a considerable liquidity crisis for independent power producers and subsequently hindered credit flows to the sector. The draft proposal also intends to permit multiple private players to operate in the same retail electricity area, a provision not currently covered by the existing Electricity Act.
Source: https://www.livemint.com/news/india/india-to-open-up-state-run-retail-electricity-market-for-private-sector-firms-draft-bill-shows-11760094319256.html