Bring in prepaid smart meters in three years: Govt to states and UTs

India’s average aggregate technical and commercial (AT&C) losses are at 21.4%, pushing up the dues of discoms to power generating companies to ₹72,938 crore at the end of November.

Union Finance minister Nirmala Sitharaman on Saturday urged states and Union territories to replace conventional electricity meters with prepaid smart meters in three years, to cut losses and set the stage for separating the carriage and content operations of power distribution companies, or discoms.Carriage refers to distribution aspect and content to power.

Union Finance Minister Nirmala Sitharaman, holding a folder containing the Union Budget documents, poses for photographers along with her deputy Anurag Thakur. (PTI Photo)

India’s average aggregate technical and commercial (AT&C) losses are at 21.4%, pushing up the dues of discoms to power generating companies to ₹72,938 crore at the end of November. Smart meters minimize human intervention in metering, billing and collection, and help reduce theft by identifying loss pockets. “Also, this would give consumers the freedom to choose the supplier and rate as per their requirements,” Sitharaman said.

India’s proposed distribution reform scheme—tentatively named Atal Distribution System Improvement Yojana (Aditya) to cut electricity losses below 12%—starts with smart meters. The scheme in the works aims to ensure continuous supply, adopting models such as privatising state-run discoms and having multiple supply, network and distribution franchisees.

Experts welcomed the move. “Some utilities can realistically do it in three to five years. Similar is the case of implementing smart meters in three years, possible for select areas and customers,” said Sambitosh Mohapatra, partner, power and utilities, PwC India.

“It will surely resolve long-term viability issues of the power sector and lead to a vibrant electricity market,” said Sanjeev Aggarwal, chief executive officer, Amplus Energy Solutions.

The budget also extended the corporate tax rate of 15% to new domestic electricity generation companies, and provided for around ₹22,000 crore to the power and renewable energy sector in 2020-21.