The energy sector in India is impacted by certain key market trends, including unprecedented growth of renewable energy sources and advent of new technologies like electric vehicles and rooftop photovoltaic. These trends create uncertainty in the sector and require regulatory and policy changes to accommodate the increasing penetration of renewables into the grid. In this regard, CSTEP has identified two main challenges: smooth transition of state utilities to renewable energy and development of robust operational processes for long-term sustainability of distribution companies. Our work aims to explore the potential of states to meet renewable energy targets and strategise with government bodies for policy implementation at both state and national levels.

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Karnataka Distribution Sector Landscape

The launch of Ujwal DISCOM Assurance Yojana (UDAY) in November 2015 gave new hope to the ailing distribution companies (DISCOMs) in India. Karnataka signed up for UDAY with a view to improve its operational efficiency. The DISCOMs under the scheme have to reduce Aggregate technical and commercial (AT&C) losses to 14.2% , and bring down the gap between average cost of supply (ACS) and average revenue realisation (ARR) to zero by 2019.