Strict measures for subsidy accounting for discoms!

08 Aug 2023 CW Team

With the aim of setting up a sustainable framework for the power sector, the Ministry of Power has made revisions to the Electricity Rules 2005. These changes introduce measures to streamline various aspects such as accounting, reporting, billing, and subsidy disbursement from states to the DISCOMs.

The rationale behind these measures stems from irregular and opaque accounting practices, which have resulted in delayed or non-existent payment of subsidies that states had pledged. These issues have significantly contributed to the financial challenges faced by DISCOMs.

In April of this year, the Ministry of Power put forth proposed amendments in the Electricity (Amendment) Rules, 2023. They invited feedback and suggestions from stakeholders, with a deadline for submission set for May 11, 2023.

Under the newly implemented regulations, DISCOMs will now be obliged to furnish quarterly reports within 30 days after the end of each quarter. Following this, the state commission will evaluate the reports and provide their findings within 30 days of receiving the documents.

These quarterly reports will entail comprehensive information about subsidy requests raised in relation to energy consumption by subsidised categories. Furthermore, they will encompass details about the subsidy amount declared by the state government, along with the actual payment made, all in accordance with the stipulations of section 65 of the Electricity Act.

In cases where the subsidy has not been pre-paid, the state commission will issue an order to implement the tariff without factoring in the subsidy.

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