Bihar’s Power Sector Reforms Eliminate Need for Government Grants for AT&C Losses

Patna: Bihar’s electricity distribution companies have significantly improved their financial performance, eliminating the need for government grants towards Aggregate Technical and Commercial (AT&C) losses for the financial years 2023-24 and 2024-25. The development marks a major shift in the state’s power sector, reducing the burden on the exchequer.

Between 2019-20 and 2022-23, the state government had provided financial support amounting to Rs 860 crore, Rs 1,266 crore, Rs 1,422 crore, and Rs 1,094 crore, respectively, to compensate for AT&C losses. However, sustained efforts in loss reduction and revenue collection by the distribution companies have ensured that these grants are no longer required.

In a further boost to the state’s finances, the power distribution companies have made record revenue collections. Of the Rs 1,442 crore due as energy charges to the Commercial Tax Department, Rs 1,141 crore has already been deposited, with the remainder set to be paid by the end of the financial year.

Bihar’s energy minister, Bijendra Prasad Yadav, hailed the reforms as a historic achievement, crediting the improvements in revenue collection and reduced AT&C losses with strengthening the state’s financial position. “This milestone has not only eliminated the need for subsidies but has also contributed to a continuous increase in the state’s revenue,” Yadav said.

The minister highlighted that under the leadership of Chief Minister Nitish Kumar, the energy sector’s progress is playing a crucial role in Bihar’s economic development. The improved financial performance of the power sector, he said, would allow the state to allocate more resources to infrastructure, social welfare, and other essential projects. The reforms, he added, are a significant step towards making Bihar self-reliant in the energy sector.