Bhubaneswar: At a time when the Union Ministry of Power (MoP) has proposed amendments to the Indian Electricity Act, 2025 in order to revive India’s ailing power distribution sector, Odisha’s model of privatised electricity distribution has emerged as a system that is already delivering results.
Five years after privatisation, the four power distribution companies (Discoms) in the state have cut Aggregate Technical & Commercial (AT&C) losses by more than 10 percentage points, achieving measurable efficiency gains and a striking financial turnaround.
In a sector long plagued by inefficiency and mounting losses, Odisha has shown that structural reforms, with accountability, can deliver operational stability as well as provide consumer benefits.
In the last 5 years, Odisha’s Discoms have rolled out more than a million new electricity connections at an investment of around Rs 5,000 crore in network upgrades, technology integration, staff training and safety improvements.
Led by Tata Power, and in partnership with the state government, the distribution companies currently serve around 1 crore consumers across an area of 150,000 sq km area, thereby catering to a population of nearly 5 crore people.
So much so that the MoP has recognised Odisha Discoms as being among the best in the country in their annual ratings.
The most remarkable achievement has been in rural electrification. For the first time, a private player has transformed power distribution in India’s villages, delivering reliable service to areas that had been neglected over the years. The success has positioned Odisha as a case study in how private-sector efficiency can be harnessed for public good, and a reform model that other states can replicate.
Most state-run Discoms reel under heavy losses, restricting the growth of India’s power sector.
The proposed amendments to the Electricity Act will help in a paradigm shift towards a more efficient, transparent and market-driven power sector.
As per the draft, the amendments seek to make cost-reflective tariffs mandatory and ensure that electricity prices reflect the cost of supply. Indian industries currently have to bear the brunt of high tariffs, as domestic consumers are often subsidised at their expense, making them less competitive globally.
The amendments will allow states to continue offering advance subsidies to targeted consumer groups, thereby protecting vulnerable sections while discouraging populist tariff distortions.
Another major proposal is elimination of cross-subsidies for Railways, Metro Railway, and Manufacturing Enterprises within five years — a move expected to reduce industrial tariff burdens and enhance competitiveness.
The draft also empowers the Central Electricity Authority (CEA) to frame cybersecurity regulations for integrated grid operations, to ensure resilience against digital threats.
Odisha stands out as a first mover, having already implemented many of these principles on the ground. Its privatised distribution framework has fostered operational discipline, enhanced customer service and accelerated network modernization.
