Union Budget 2026: Electricity Amendment Bill Expected in Parliament Session

Union Power Minister Manohar Lal announced that the Electricity Amendment Bill is likely to be introduced in the upcoming Union Budget session of Parliament. 

The bill aims to reform the power sector and improve the financial health of debt-laden power distribution companies (discoms), ensuring they operate efficiently and receive timely payments. 

The minister shared these insights during the inauguration of the IIT-Delhi-CERC-Grid India Centre of Excellence in New Delhi.

Profitability Gains and Remaining Challenges

The power ministry reported that in FY25, power distribution utilities collectively recorded a profit of ₹2,701 crore, marking a positive turnaround after years of losses. However, around 50 discoms continue to operate in deficit, highlighting the need for structural reforms to ensure sector-wide profitability.

Proposed Amendments and Stakeholder Consultations

To address these issues, the upcoming Electricity (Amendment) Bill, 2025, seeks to strengthen the sector through financial discipline, cooperative governance, healthy competition, and improved operational efficiency. 

The government plans to hold consultation meetings with state representatives to review the proposed changes, ensuring that the amendments preserve the federal balance while tackling the challenges facing the power sector.

Criticism and Opposition

Despite its objectives, the bill has faced criticism from several quarters. The All India Power Engineers Federation (AIPEF) has opposed certain provisions, claiming that allowing multiple distribution licensees to use existing government discom networks supports privatisation motives. 

AIPEF Chairman Shailendra Dubey argued that the government continues to push a privatisation agenda through the Electricity (Amendment) Rules, raising concerns about the implications for public utilities.

Also Read: Union Budget 2026 To Be Presented on February 1!

Conclusion

The Electricity Amendment Bill, expected in the Union Budget 2026, represents a significant step toward reforming India’s power distribution sector. While it aims to enhance efficiency, financial stability, and timely payments for discoms, balancing privatisation concerns and public interest will be critical for its successful implementation and long-term impact on the sector.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a private recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.