Outstanding dues of power distribution companies (discoms) have seen a notable reduction in recent years, following regulatory and policy interventions by the government.
Measures introduced to restructure payments and enforce financial discipline have contributed to this decline.
The latest update presented in Parliament highlights changes in both legacy and current dues within the power distribution sector, as per The Economic Times report/
Legacy dues of discoms have reduced to around ₹3,300 crore as of March 2026, compared to approximately ₹1.39 lakh crore recorded in June 2022.
These dues included outstanding payments owed to power generators, traders, and transmission companies, along with applicable surcharges. The reduction reflects progress in clearing past liabilities over a defined period.
The decline in dues follows the implementation of the Electricity (Late Payment Surcharge and Related Matters) Rules, 2022.
Under these rules, outstanding amounts up to June 2022 were categorised as legacy dues and were required to be repaid in instalments over time. The framework aimed to provide a structured approach to clearing arrears while ensuring accountability.
Alongside legacy dues, discoms also maintain current payment obligations. As per recent data, current dues stand at around ₹13,594 crore, while total dues, including legacy amounts, are estimated at approximately ₹16,894 crore.
Distribution utilities have been making efforts to meet ongoing payment requirements to remain compliant with regulatory provisions.
The PRAAPTI portal has been used to track and monitor payments within the power sector. This platform provides visibility into outstanding dues and payment patterns across utilities.
The use of such systems has supported transparency and improved oversight of financial obligations in the sector.
Several government initiatives have contributed to the financial restructuring of discoms. The Ujwal DISCOM Assurance Yojana (UDAY), launched earlier, focused on improving operational and financial efficiency.
More recently, the Revamped Distribution Sector Scheme (RDSS) has been introduced to support infrastructure upgrades, reduce losses, and improve performance. Funding under this scheme is linked to measurable improvements, encouraging better financial management.
Despite improvements, certain challenges continue to affect timely payments by discoms. These include gaps between the cost of electricity supply and revenue realised, delays in subsidy payments from state governments, and regulatory adjustments to expenses.
Addressing these factors remains important for sustaining financial stability in the sector.
The reduction in legacy dues indicates progress in addressing long-standing financial issues in the power distribution sector. Policy measures, structured repayment mechanisms, and monitoring systems have contributed to this outcome. Continued focus on operational efficiency and timely payments will be relevant for maintaining stability in the sector.
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Published on: Apr 2, 2026, 3:10 PM IST
Neha Dubey
Neha Dubey is a Content Analyst with 3 years of experience in financial journalism, having written for a leading newswire agency and multiple newspapers. At Angel One, she creates daily content on finance and the economy. Neha holds a degree in Economics and a Master’s in Journalism.
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