TG’s Third Discom To Manage Free, Subsidised Power To Start on April 1
New utility from April 1 to ease financial stress on existing power distributors
Hyderabad: In a major restructuring of the power sector, the state government has approved the creation of a third power distribution company (Discom), which will begin operations from April 1. The new Discom will be dedicated to handling free power supply and other electricity schemes based on government subsidies.
According to a government order, the financial health of the existing Telangana Discoms has weakened over time due to a widening gap between the Average Billing Rate (ABR) and the Average Cost of Service (ACoS). This situation has limited their capacity to raise funds for development works and restricted their participation in key infrastructure programmes such as the Revamped Distribution Sector Scheme (RDSS). As a result, the discoms have faced difficulties in carrying out essential system upgrades required to ensure reliable and quality power supply across the State.
The government order said the third discom will be responsible for electricity retailing to specific consumer categories supported by government subsidies, thereby easing the financial burden on the existing utilities.
The new discom will function in addition to the two existing entities, the Southern Power Distribution Company of Telangana Limited (SPDCL) and the Northern Power Distribution Company of Telangana Limited (NPDCL). Currently, SPDCL caters to 15 districts, while NPDCL covers 18 districts in the State.
The State Cabinet had approved the proposal in November. With the establishment of the third Discom, all power subsidy schemes implemented by the State government will come under its jurisdiction. These include free electricity for agricultural pump sets, the Gruha Jyothi scheme providing 200 units of free domestic power, free power supply to government schools and colleges, drinking water schemes such as Mission Bhagiratha and other safe drinking water projects, lift irrigation schemes, and the power requirements of the Hyderabad Metropolitan Water Supply and Sewerage Board (HMWS&SB).