Power DISCOMs Turn Profitable in Aggregate - But Telangana, Andhra Pradesh Utilities Still Bleeding

India’s power distribution utilities have collectively reported a Profit After Tax (PAT) of ₹2,701 crore in FY 2024–25 , marking the sector’s first return to profit after years of sustained losses. The turnaround, announced by the Ministry of Power, represents a dramatic improvement from a loss of ₹25,553 crore in FY 2023–24 and a much deeper loss of ₹67,962 crore in FY 2013–14 .

Union Power Minister Manohar Lal described the development as the beginning of a “new chapter” for the electricity distribution sector, attributing the recovery to a decade of structural reforms aimed at improving financial discipline, transparency and operational efficiency.

However, officials and sector analysts caution that the improvement is not uniform across states , with profitability largely driven by a handful of well-performing regions, while several large states including Telangana and Andhra Pradesh continue to post heavy losses.

Aggregate Profit Masks Sharp State-Level Divergence

States such as Gujarat, Maharashtra, Karnataka, Haryana, Himachal Pradesh, Goa and Delhi have emerged as the strongest performers. Their distribution companies benefit from lower technical losses, regular tariff revisions, tighter billing and collection systems, and limited political intervention in pricing.

Private distribution utilities in Delhi and parts of western India continue to post consistent profits and have significantly contributed to the national surplus.

In contrast, several states remain deep in the red. These include Telangana, Andhra Pradesh, Tamil Nadu, Punjab, Uttar Pradesh, Bihar, Jharkhand and West Bengal , where distribution utilities continue to rely heavily on government subsidies and borrowings.

Telangana DISCOMs Still in Losses

Telangana’s two distribution companies TGSPDCL and TGNPDCL remain loss-making despite operational improvements. Annual losses are estimated to run into ₹5,000–7,000 crore , primarily due to the burden of 24×7 free power to agriculture , delayed subsidy reimbursements, limited tariff revisions for domestic consumers, and rising power purchase costs.

While Aggregate Technical and Commercial (AT&C) losses in the state have improved to around 16–18 per cent , they remain above the national average of 15.04 per cent recorded in FY 2024–25.

As a result, Telangana’s utilities did not materially contribute to the national profit figure.

Andhra Pradesh Among the Biggest Laggards

Andhra Pradesh continues to rank among India’s most financially stressed power distribution sectors. The state’s three DISCOMs APSPDCL, APEPDCL and APCPDCL together post annual losses estimated between ₹8,000–10,000 crore , with accumulated sector debt exceeding ₹1 lakh crore .

High subsidy commitments, political resistance to tariff hikes, delayed government payments and legacy long-term power purchase agreements have weighed heavily on finances. AT&C losses remain close to 19–21 per cent , significantly above the national average.

Reforms Drive National Turnaround

The Ministry of Power attributes the overall improvement to multiple reform measures, including the Revamped Distribution Sector Scheme (RDSS) , accelerated smart metering, tighter prudential norms linked to access to finance, amendments to electricity rules ensuring timely tariff revisions, and the introduction of uniform accounting standards under the Electricity Distribution (Accounts and Additional Disclosure) Rules, 2025 .

The Late Payment Surcharge Rules have been particularly impactful, leading to a 96 per cent reduction in outstanding dues to power generators from ₹1.39 lakh crore in 2022 to ₹4,927 crore by January 2026 while reducing average payment cycles from 178 days in FY 2020–21 to 113 days in FY 2024–25 .

Nationwide, AT&C losses have declined from 22.62 per cent in FY 2013–14 to 15.04 per cent in FY 2024–25 , and the Average Cost of Supply–Average Revenue Realised (ACS–ARR) gap has narrowed sharply from ₹0.78 per unit to just ₹0.06 per unit , reflecting improved cost recovery.

Silver Linings for Telangana and Andhra Pradesh

Despite continuing losses, officials point to important stabilising trends even in laggard states such as Telangana and Andhra Pradesh. Payment discipline has improved, generator dues have fallen sharply, interest burdens have reduced, and financial transparency has increased through uniform accounting norms.

Smart metering rollout, direct benefit transfer of subsidies and improved billing systems are expected to further reduce leakages in the coming years.

A Sector Stabilised, Not Yet Healed

While India’s power distribution sector has finally crossed into profitability in aggregate, the turnaround remains uneven and incomplete . The national numbers reflect strong performance by a limited group of states, even as several large electricity markets continue to strain under subsidy burdens and political constraints.

As officials acknowledge, the reforms have stopped the financial bleeding nationwide , but the challenge ahead lies in ensuring that states such as Telangana and Andhra Pradesh translate operational gains into sustained financial viability turning an accounting milestone into a truly nationwide recovery.