Innovative Strategies: Key trends in metering, billing and collection

Metering, billing and collection are integral components of the po­wer sector that have a significant impact on its efficiency, revenue collection and the overall consumer experience. The government’s Revamped Dis­tribution Sector Scheme (RDSS), which has an outlay of over Rs 3.03 trillion, also focuses on smart metering. In the first phase, around 100 million prepaid sma­rt meters are proposed to be installed by December 2023.

The central government has introduced various programmes and initiatives to implement smart metering across the country. Scheme-wise, over 842,899 sm­art meters have been installed under the Integrated Power Development Scheme (IPDS) while 168,744 smart meters have been installed under the National Smart Grid Mission (NSGM). In addition, 377,182 smart meters have been install­ed under the Prime Minister’s Develop­ment Package, 1,984,956 182 under the RDSS and 38,400 under the Deendayal Upadhyaya Gram Jyoti Yojana. Among agencies, Energy Efficiency Services Li­mited has installed 65,000 smart meters and REC Power Development and Con­sultancy Limited has installed 4,844,735 smart meters. Further, power utilities ha­ve cumulatively installed 270,100 sm­a­rt meters and PFC Consulting Limited has installed 1,698,459 smart meters.

Progress so far

The country’s aggregate technical and commercial (AT&C) losses fell to 16.42 per cent in 2021-22, a 6 per cent dec­rea­se from the 2020-21 levels and a 4 per cent decrease from the 2019-20 levels. The AT&C losses further reduced to 13.5 per cent (provisional) in 2022-23. This can be attributed to improvement in collection efficiency, which increased from 92.71 per cent in 2019-20 to 97.25 per cent in 2021-22. Meanwhile, billing efficiency remained constant at about 85 per cent during the same period.

During 2021-22, Haryana, Chhattisgarh, Assam, Karnataka, Kerala, Nagaland, Pu­du­cherry, Rajasthan and Uttarakha­nd ac­hieved 100 per cent collection efficiency, whereas Arunachal Pradesh re­cor­ded the lowest billing efficiency of 53.3 per cent. Meanwhile, the highest bill­ing efficiency of 95.39 per cent was ac­hie­ved by Maha­rashtra, whereas Bihar registered the lowest collection efficiency of 85.75 per cent.

On the metering front, 205.32 million consumer meters, 5.41 million distribution transformer meters and 201,695 feeder meters have been sanctioned un­der the RDSS, at a total sanctioned cost of approximately Rs 1.35 trillion. As of February 2023, tenders have been issued for smart metering works, covering app­roximately 103 million prepaid smart me­ters for consumer metering, as well as 3.8 million system meters for distribution transformers and feeders. Furth­er, tenders have been issued for distribution infrastructure/loss reduction works amounting to Rs 788.27 billion.

As per PFC’s Report on the Performance of Power Utilities, the aggregate losses of distribution utilities decreased from Rs 465.21 billion in 2020-21 to Rs 310.26 billion in 2021-22. Meanwhile, the tariff sub­sidy billed by distribution utilities increased from Rs 1,333.06 billion to Rs 1,437.81 billion. The tariff subsidy relea­s­ed by the state governments as a perce­ntage of tariff subsidy billed by distribution utilities increased from 84 per cent in 2020-21 to 109 per cent in 2021-22. The revenue gap on tariff subsidy bill­ed basis decreased from Re 0.38 per kWh in 2020-21 to Re 0.23 per kWh in 2021-22, while the gap on tariff subsidy re­ceived basis, excluding regulatory inco­me and revenue grant under Ujwal Discom Ass­urance Yojana for lo­an takeover, improv­ed significantly fr­om Re 0.69 per kWh to Re 0.15 per kWh.

Progress under government programmes

Under the RDSS, prepaid smart metering is envisaged with an estimated outlay of around Rs 1,500 billion and gross budgetary support of about Rs 230 billion. The objective is to install 250 million pre­paid smart meters during the sche­me’s duration. In addition to prepaid smart metering for consumers, system metering will be undertaken at the feeder and distribution transformer levels, equipped with communication features, associated ad­vanced metering infrastructure (AMI) and a unified billing system. This will en­able discoms to automatically measure energy flows at all levels, perform energy accounting and conduct audits without any human interference.

Under the NSGM, 168,744 smart meters have been installed so far out of the 178,522 sanctioned. Currently, two projects worth Rs 1,160.1 million are being implemented in Chandigarh, along with one integrated project in six towns of Rajasthan. As per the SMNP dashboard accessed in October 2023, around 1.58 million smart meters have been install­ed, resulting in an average discom revenues increase of 20.5 per cent, equivalent to a monthly per meter increase of Rs 301. According to the latest data from the IPDS portal for smart metering, the total approved project cost and project management agency cost is around Rs 2.29 billion and the total government grant is Rs 1.44 billion, of which Rs 812.4 million has been disbursed.


AMI is an essential step towards the digitalisation of utilities. It involves the deployment of smart meters, which provide real-time data on energy consumption to both consumers and utility providers. Besides energy accounting and loss identification, AMI data can be used for analysis through advanced digital tools. This analysis helps in achieving accurate demand forecasting across different time intervals (daily/week­ly/ se­a­sonally), thereby reducing the power purchase cost, optimising network ass­ets and operations, expediting outage de­tection and service restoration, and enabling remote operations. It will also ensure accurate measurement of reliability indices and power quality measurement. For customers, AMI adoption has several advantages. These include er­ror-free billing, elimination of the need for physical visits to billing centres, access to innovative tariff options, re­mo­te appliance management and control, and the potential for significant sa­vi­ngs through improved electricity consumption management. However, the implementation and maintenance of an AMI system involving millions of meters is a very complex process that requires trained personnel.

Distribution franchise

Distribution utilities often delegate certain areas to distribution franchisees (DFs) with the aim of reducing AT&C lo­ss­es and enhancing overall performance. These improvements encompass metering, billing, collection practices and mo­dernisation of the distribution net­work, among other measures. Curr­en­tly, app­roximately 12 DFs are active in various circl­es/di­­visions across states such as Maha­ras­h­tra, Uttar Pradesh, Ra­jasthan, Meg­h­ala­ya and Tripura. Of the­se, CESC Limited manages four DF contracts (Ko­ta, Bha­ra­t­pur, Bikaner and Ma­lega­on), while Torrent Power Limited oversees three DF contracts (Bhiwandi; Agra; and Shil, Mu­mb­ra and Kalwa). In addition, Feedback Electricity Distri­bution Co­mpany Limi­ted is responsible for specific electricity divisions in Me­ghalaya and Tripura, Sai Computers ma­nages two contracts (Dalu and Kaila­shahar), while Tata Power handles a single contract in Ajmer.

Recent developments

To improve the financial stability of discoms and establish a sustainable framework for the power sector, the Ministry of Power (MoP) issued the Electricity (Se­­co­nd Amendment) Rules, 2023, in­cor­porating provisions for subsidy acc­ounting and payment, and the framework for financial sustainability. As per these amendments, discoms are now required to provide quarterly reports with detailed information about subsidy payments. The amendment also introduces procedures for allowing the transfer of expenses incurred by distribution licensees for the creation and upkeep of distribution assets.

In June 2023, the MoP issued the Electri­city (Rights of Consumers) Amendment Rules, 2023. Through this amendment, the ministry introduced time-of-day (ToD) tariffs and rationalised smart me­tering provisions. According to the new rules, smart meters must be read re­mo­tely at least once a day, while other prepayment meters should be read by an authorised representative of the distribution licensee at least once every three months. Under the ToD tariff system, the tariff during solar hours of the day will be 10-20 per cent lower than the normal tariff, while the tariff during peak hours will be 10-20 per cent higher. The ToD tariffs will come into effect from April 1, 2024 for commercial and industrial consumers with a maximum demand of over 10 kW; and from April 1, 2025 for other consumers, except agricultural co­nsumers. The new rules will help st­re­amline the procedures and protocols for smart meter reading and im­prove consumer access to smart meter data while enabling energy efficiency.

Recently, in September 2023, GMR Sm­art Electricity Distribution Private Limi­ted (GSEDPL) received a letter of award (LoA) from Dakshinanchal Vidyut Vitran Nigam Limited to implement a smart metering project in the Dakshinanchal (Agra and Aligarh zone) area of Uttar Pra­desh. GSEDPL will install, integrate and maintain 2.55 million smart meters. The implementation tenure is expected to be 27 months from the date of execution of the contract, with an operating period of 93 months. The total contract value (in­c­lu­sive of goods and services tax) for the Agra and Aligarh zones is ab­out Rs 24.7 billion.

In July 2023, Tata Power received an LoA to implement a smart metering project for Chhattisgarh State Power Distribu­tion Company Limited. The project will be implemented in the Raipur area (Rai­pur city and Raipur rural areas) of Chhattis­garh. Tata Power’s responsibilities inclu­de the installation and maintenance of 1.86 million meters. The value of the project is around Rs 17.44 billion and will sp­an a period of 10 years. During the same month, GMR Smart Electricity Distribu­tion Private Limited, a subsidiary of GMR Power and Urban Infra Limited, was awarded an order worth Rs 75.93 billion to implement a large-scale smart metering project under the RDSS.


To improve the financial performance of discoms and enhance consumer satisfaction, there has been a strong policy focus on the distribution segment. With the introduction of innovative technologies and strategies, the sector is gradually overcoming its challenges including high AT&C losses, and poor billing and collection efficiency. In order to streamline ac­counting, billing and subsidy payments, the government has recently am­ended the electricity rules, mandating discoms to submit quarterly reports on the subsidy demand raised across various subsidised categories. The ministry has also mandated the introduction of ToD tariffs for all consumer categories by 2025. Going forward, smart meters are increasingly empowering consumers with greater control over their energy consumption and energy bills, while enhancing the billing and collection efficiency of discoms.

Akanksha Chandrakar