Delhi government cracks down on power discoms, directs CAG audit over ₹38,500 cr pending RAs – Here's what we know

Published 3 July 2026 · local

CM Rekha Gupta-led Delhi government on Wednesday directed the Comptroller and Auditor General (CAG) to conduct an audit of the capital's power distribution companies amid

CM Rekha Gupta-led Delhi government on Wednesday directed the Comptroller and Auditor General (CAG) to conduct an audit of the capital's power distribution companies amid concerns over regulatory assets (RA) worth nearly ₹38,500 crore that have built-up over the years and are ultimately meant to be recovered from electricity consumers. This comes after the Delhi High Court on June 22 declined to intervene in the Delhi government's decision to have the CAG audit the accounts of BSES Rajdhani Power Ltd (BRPL) and BSES Yamuna Power Ltd (BYPL). Dismissing a petition filed by the two power distribution companies, a vacation bench of Justice Tejas Karia observed that their challenge was premature at this stage. Following the ruling, Delhi Power Minister Ashish Sood welcomed the High Court's decision. According to an order issued by the Delhi Power Department, the CAG will carry out a comprehensive and rigorous audit to examine why the city's three power discoms—BRPL, BYPL and Tata Power Delhi Distribution (TPDDL)—have continued operating without recovering the mounting regulatory assets, reported PTI. The order states that the audit should ideally be completed within three months of its communication, although the CAG may grant additional time depending on the scope and complexity of the exercise. According to the order, the audit is expected to be completed within three months from the date it is communicated, although the CAG may extend the timeline depending on the scope and complexity of the exercise.

“The question of a CAG audit of the Delhi discoms is currently sub judice before the courts. As the matter is under judicial consideration, it would not be appropriate to comment further,” a BRPL spokesperson stated. There was no immediate response from the other power distribution companies. If the discoms do not pursue further legal action, this will mark the first CAG audit of Delhi's electricity distribution companies since the sector was privatized in 2002. A previous attempt by the former AAP government to subject the discoms to a CAG audit was blocked by the Delhi High Court in 2015. Regulatory assets (RAs) are deferred costs incurred by power distribution companies due to fluctuations in fuel prices. They represent the difference between the average cost of supplying electricity and the revenue discoms recover through consumer tariffs and government subsidies. The outstanding regulatory assets, estimated at ₹38,500 crore and owed to BRPL, BYPL and TPDDL, are reportedly recovered through a regulatory assets surcharge included in consumers' electricity bills. According to the order, the Delhi cabinet, at its June 29 meeting, approved a recommendation in the public interest for a "strict and intensive" CAG audit to examine why the power distribution companies have continued to carry these unrecovered regulatory assets. The Power Department's order authorising the audit has received the approval of the Lieutenant Governor of Delhi.