Power Secretary Pankaj Agarwal said on Thursday that the draft national electricity policy (NEP) 2026, which proposes promoting competition in electricity supply and allowing multiple distribution licensees, has been sent to the union Cabinet.
“We have aggregated all the stakeholders’ comments and have already moved the Cabinet note for the inter-ministerial consultation. I think it shouldn’t be taking very long,” Agarwal told reporters on the sidelines of an event organised by FICCI.
The previous NEP was issued in 2005, when the challenges were very different such as access to electricity, power shortages etc. Developing new sources of renewable energy was thought of as a solution then, while today the challenges are different, he added.
“Today we are at a very different level…we are already at 300 GW of non-fossil and now going forward, the challenges are entirely different like grid management and building transmission systems,” the Secretary said.
The sector now needs financially sustainable, self-reliant and technology-driven distribution companies to meet emerging requirements, Agarwal added.
“Electricity sector will prioritise consumer needs, offering choices in supply and usage. Government policies should encourage consumers to actively manage their energy consumption,” the draft NEP emphasises.
Released in January 2026, the draft NEP seeks to restore the financial health of the Discoms by promoting cost-reflective tariffs, timely cost pass-through, and reduction of AT&C losses.
Some State governments have expressed reservations regarding proposals such as allowing multiple distribution licensees in a single area and private entities cherry-picking consumers.
For instance, The Hindu reported in February 2026 that Kerala Electricity Minister K Krishnankutty informed the Assembly that the Draft NET 2026 is likely to adversely impact Kerala’s power supply model and social circumstances.
Replying to questions in the House, he said the proposals to promote competition in electricity supply and allow multiple distribution licensees in a supply region would have negative impact on consumers in the State.
Published on September 24, 2026
