Hyderabad: The Telangana government on Wednesday, December 17, ordered the formation of a third power distribution company in the state which will handle 29,08,138 connections.
As per Government Order (GO) number 44, the new company will begin operation from April 1, 2026. It will be dedicated to handling free power supply and other electricity schemes based on government subsidies.
According to the GO, the financial condition of the existing Telangana discoms has weakened over time due to a widening gap between the Average Billing Rate (ABR) and the Average Cost of Service (ACoS).
This situation has limited their capacity to raise funds for development works and restricted their participation in key infrastructure programmes such as the Revamped Distribution Sector Scheme (RDSS).
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This has caused challenges for the discoms to conduct essential upgrades which could ensure reliable and quality power supply across Telangana. The government order said that the new power distribution company will be responsible for electricity retailing to specific consumer categories supported by government subsidies, thereby easing the financial burden on the existing utilities.
The new discom will function in addition to the two existing entities, the Southern Power Distribution Company of Telangana Limited (TGSPDCL) and the Northern Power Distribution Company of Telangana Limited (TGNPDCL). Currently, SPDCL caters to 15 districts, while NPDCL covers 18 districts in the state.
The Telangana cabinet had approved the proposal in November. With the establishment of the third distribution company, all power subsidy schemes implemented by the State government will come under its jurisdiction.
