New Delhi: The Ministry of Power on Wednesday sought stakeholder comments on the draft National Electricity Policy (NEP) 2026, which aims to address high losses and debt of discoms, noncost-reflective tariffs, and high cross-subsidisation.
A non-cost-reflective tariff is a pricing structure in which the rate charged to a particular consumer category is below the utility’s average cost of generating, transmitting, and distributing electricity to that category.
While cross-subsidisation is a pricing mechanism in which certain consumer groups (industrial, commercial, and higher-income domestic users) are charged tariffs above the cost of supply to offset and subsidise the lower tariffs provided to other groups, such as agricultural consumers and low-income households.
The draft also seeks to foster competition, ensure grid resilience to integrate increased shares of variable renewable energy, and provide consumer-centric services with demand-side interventions, the Ministry said in a statement.
The comments are to be submitted within 30 days.
The Ministry said that despite several achievements made since 2005, the power sector still has challenges, especially in the distribution segment.
“Persistent challenges remain, particularly in the distribution segment, such as high accumulated losses and outstanding debt.
“Tariffs in several segments remain non-costreflective, and high crosssubsidisation has resulted in elevated industrial tariffs, adversely affecting the global competitiveness of Indian industry,” the Ministry said.
Against this backdrop, the Draft NEP 2026 sets ambitious yet necessary goals. The Policy targets per capita electricity consumption of 2,000 kWh by 2030 and over 4,000 kWh by 2047.
It also aligns with India’s climate commitments, including reducing emissions intensity by 45 per cent below 2005 levels by 2030 and achieving netzero emissions by 2070, necessitating a decisive shift towards low-carbon energy pathways.
