An allocation of Rs 22,000 crore has been made for the power and renewable energy sector in the Union Budget 2020-2021.

“Further measures to reforms Discoms would be taken. I propose to provide Rs 22,000 crores to power and renewable energy sector for 2020-2021,” Finance Minister, Nirmala Sitharaman said during the Union Budget speech 2020-2021.

“Taking electricity to every household has been a major reform of the Government. However, the distribution sector, particularly the DISCOMs are under financial stress. The Ministry (of Power) intends to promote smart metering. I urge all the state and union territories to replace conventional electricity meters by pre-paid smart meters in next three years. Also, this would give consumers the freedom to choose the supplier and the rate as per their requirements. This is a very important step in reaching electricity to all people,” Sitharaman said.

In January, BusinessLine reported that the centre's second leg of Power Distribution Company (DISCOM) debt and loss reduction reforms may feature in Budget 2020-2021.

This new reform is aimed at addressing the requirements that power distribution companies have for ensuring 24x7 supply. The scheme will have assistance for reduction of losses. This assistance will be in terms of technology, modern equipment to help address the losses.

For the oil and gas sector, Sitharaman said, “The open acreage license policy (OALP), is a success having awarded 1.37 lakh square kilometers for exploration to private sector and to Central Public Sector Enterprises (CPSEs). City gas distribution rights are also awarded.”

“Further, it is proposed to expand the national gas grid from the present 16,200 kilometers to 27,000 kilometers. To deepen the gas markets in India, further reforms will be undertaken to facilitate transparent price discovery and also ease of transactions,” she added.

In January 2020, the Chairperson of the Petroleum and Natural Gas Regulatory Board (PNGRB), Dinesh Kumar Sarraf told BusinessLine that he is confident that the country’s natural gas exchange will become operational in 2020 itself.

Sitharaman also said that a proposal is under consideration for setting up a large solar power capacity, alongside the rail tracks on the land owned by railways.