The Central Government has issued the draft Electricity (Amendment) Bill, 2025 to reform India’s power sector. The Bill focuses on financial sustainability, tariff rationalisation, stronger regulation, and faster transition towards non-fossil fuel-based electricity. It is aligned with the broader goal of Viksit Bharat @ 2047 and remains in the consultation stage.
Financial Sustainability and Tariff Reform
The draft Bill seeks to improve the viability of distribution companies through cost-reflective tariffs. It proposes to empower electricity regulators to determine tariffs suo motu from 1 April each year. The aim is to reduce losses, improve payment discipline, and ensure reliable power supply.
Competition and Industrial Competitiveness
High industrial tariffs and cross-subsidies have affected economic efficiency. The proposed reforms seek to rationalise tariffs, reduce procurement costs, and improve industrial competitiveness. The Bill also aims to unlock electricity demand by making pricing more transparent and market-oriented.
Energy Transition and Renewable Targets
The Bill supports India’s target of 500 GW non-fossil fuel capacity by 2030. It proposes market-based instruments to attract investment in renewable energy. It also seeks enforceable non-fossil energy obligations, bringing the Electricity Act in line with the Energy Conservation Act.
Regulatory Accountability and Consumer Protection
The draft includes measures to strengthen regulatory institutions and improve service standards. It proposes a 120-day timeline for adjudicatory decisions and expansion of the Appellate Tribunal for Electricity to reduce pendency. Consumer-friendly provisions include uniform national service standards, a one-year cap on assessment for unauthorised use, and lower appeal pre-deposit requirements. The Bill also proposes transparent subsidy support for eligible consumers, including tribal households, without weakening sector finances.
Last Modified: April 27, 2026