“Delicensing distribution can introduce competition and enable retail choice for customers … Implementing retail choice by separating material and carriage may not necessarily entail the full set of theoretical benefits … Viability of competition Will depend on market size, nature of demand, incumbency efficiency, growth potential, etc,” said the report prepared with the US-headquartered non-profit Rocky Mountain Institute.
Giving an example of Mumbai, which has such a system, the report said that high regulatory fees and surcharges make migration unviable for consumers – which underscores the simultaneous need for a transparent and rational regulatory environment.
The report acknowledges that distribution is the weakest link in the growth of India’s power sector and is critical to rapid economic growth.
(Source: Niti Aayog)
A quick reading of the report reveals that the root of the problem is insufficient political will at the state level and that the complexity of India’s electricity market stems from its kaleidoscopic demographics as well as geography.
“India is too large and diverse to have a one-size-fits-all approach… A flexible and home-grown approach to reform, supported by states and the Centre, and allowing for ‘learning by doing’, will play a key role in this.” .determining success,” it says, underlining the challenges and necessity of Center And dealing with them asks to be on the same page.
The report suggested reform measures in all areas of distribution, ranging from reducing the cost of power purchase by discoms, reducing line losses to better billing. But two major suggestions that will have a huge impact on the sector are autonomy to discoms and setting up regional tariff regulators to prevent political interference.
Another major suggestion is creating storage capacity, either in the form of battery storage or pump hydro, renewable energy by discoms, to act as huge ‘power banks’ to deal with the impermanence of solar or wind power. is a major reason for the reduction.
Simultaneously, the report suggests retrofitting old power stations so that they can run at lower loads. This will facilitate better integration of renewable capacity without putting the grid at risk.
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