HERC for Modernisation, Efficiency in Power Distribution System

Why It Matters

Reducing losses and introducing consumer choice can lower tariffs, improve service quality, and set a benchmark for regulated power markets in India.

Key Takeaways

• AT&C losses at 11.67% for DHBVN.
• ARR 2026‑27 targets Rs 51,156.71 crore.
• Potential consumer‑choice model mirrors telecom sector.
• Public hearings scheduled across six Haryana districts.
• Commission balances consumer costs with distributor finances.

Pulse Analysis

The Indian power sector continues to grapple with high aggregate technical and commercial (AT&C) losses, which erode utility revenues and inflate consumer tariffs. Haryana’s Electricity Regulatory Commission (HERC) is tackling this challenge by urging its distribution companies to modernise networks, adopt smart‑grid technologies, and tighten loss‑reduction programmes. Chairman Nand Lal Sharma highlighted efficiency as the backbone of a resilient grid during a recent public hearing, emphasizing that upgraded infrastructure not only curbs technical losses but also improves outage response and service quality for the state’s 45‑million‑plus customers.

The regulator’s Annual Revenue Requirement (ARR) filing for 2026‑27 projects a total need of Rs 51,156.71 crore, while existing tariff collections are expected to generate Rs 52,761.87 crore, suggesting a nominal surplus of Rs 1,605.16 crore. However, after accounting for historic revenue gaps up to 2024‑25, HERC anticipates a shortfall of Rs 4,484.71 crore, underscoring the financial pressure on distribution utilities. By aligning revenue targets with loss‑reduction targets, HERC aims to prevent cost pass‑throughs to consumers, preserving affordability while ensuring distributors remain financially viable. This disciplined approach also aligns with national targets for loss reduction.

One of the more ambitious proposals discussed at the hearing is granting electricity consumers the freedom to select their supplier, a model borrowed from the telecom industry. If implemented, this could stimulate competition, drive service innovation, and further incentivise loss‑reduction across Haryana’s distribution firms. HERC’s series of public hearings—already held in Panchkula and Gurugram and slated for Panipat, Hisar and Yamunanagar—are designed to capture stakeholder feedback and build consensus around such reforms. Successful rollout would position Haryana as a benchmark for consumer‑centric power markets in India.