Delhi govt may invoke Section 108 of Electricity Act for CAG audit of discoms: Sood

The Delhi government is considering issuing a direction to power regulator DERC, invoking Section 108 of the Electricity Act, 2003, for a CAG audit to verify the electricity distribution companies' claim of Rs 38,500 crore in regulatory assets accumulated through a deferred levy on consumers.

Power Minister Ashish Sood asserted that the government will not allow any burden fall on the people and questioned how the discoms managed to function and earn profits despite such a huge amount of unpaid dues.

''We will explore all avenues, including invoking Section 108 of the Electricity Act, if need be, to direct the DERC for a CAG audit of the regulatory assets claimed by the discoms,'' Sood told reporters.

Sood said that the government is determined to stop the ''corruption'' that prevailed in the previous AAP regime, and the power discoms will have to explain how they functioned when there were such ''losses''. There was no power tariff hike during the decade-long AAP government in Delhi since 2015.

No immediate reaction was available from the Aam Aadmi Party (AAP) on Sood's charge.

Section 108 of the Electricity Act, 2003, lays down that the state commission (DERC in case of Delhi) will be guided by such directions in matters of policy involving public interest as the state government may give to it in writing.

It also says that the decision of the state government will be final regarding any question as to whether any direction related to a policy matter which involves public interest.

Delhi government's move to invoke Section 108 may provide temporary relief to power consumers in the city, from whom the regulatory assets are to be realised.

Regulatory assets are deferred costs incurred by discoms, which are realised through a regulatory asset surcharge in the power bills of consumers.

The Delhi Electricity Regulatory Commission (DERC) has already initiated the process for an ''intensive'' audit of power discoms in the capital by a CAG-empanelled chartered accountancy firm.

The DERC has floated a tender for engaging a CAG-empanelled chartered accountancy (CA) firm in line with the directions of the Supreme Court on August 6, 2025.

The apex court, in its order, directed the DERC to liquidate regulatory assets accumulated over the years to the discoms. The Commission's attempt for the audit of the discoms by the Comptroller and Auditor General (CAG) of India was rejected earlier by the Appellate Tribunal for Electricity.

The Supreme Court has directed DERC to undertake a ''strict and intensive audit'' of the circumstances in which the distribution companies have continued without recovery of the regulatory assets.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)