India’s power sector has witnessed several important policy and regulatory developments over the past year, with reforms focused on strengthening distribution finances, improving transmission planning, enabling competition, supporting clean energy integration and enhancing cybersecurity. Other important measures are centred on nuclear power development and improving the operational flexibility of conventional generation.
Conventional generation and nuclear power
In March 2026, the Central Electricity Authority (CEA) released the National Generation Adequacy Plan (2026-27 to 2035-36) to evaluate the generation adequacy mix to meet the projected electricity demand over the next 10 years. Under the plan, the CEA estimates India’s installed generation capacity to reach 1,121 GW by 2035-36. Energy storage capacity is also expected to reach 174 GW/888 GWh by 2035-36.
In February 2026, the CEA released a roadmap for the installation of 100 GW of pumped storage project (PSP) capacity by 2035-36, requiring a capital investment of nearly Rs 5.8 trillion. The development of the upcoming PSPs will include major civil works, electromechanical equipment and supporting infrastructure.
The nuclear power sector also witnessed a significant development with the notification of the SHANTI Bill, 2025, in December 2025. The bill seeks to modernise India’s nuclear energy framework, enable private sector participation, and repeal the Atomic Energy Act, 1926 and the Civil Liability for Nuclear Damage Act, 2010. In August 2026, the Department of Atomic Energy released the draft SHANTI Rules and Regulations, 2026, proposing provisions on nuclear operator liability, insurance and financial security to support nuclear power expansion and private participation in the sector.
Distribution reforms
The Draft Electricity (Amendment) Bill, 2025, released in October 2025, seeks to promote network sharing and competition in distribution. It proposes allowing distribution licensees to supply electricity through their own or shared networks, with non-discriminatory open access mandated under Section 42. The bill also emphasises cost-reflective tariffs and proposes empowering state electricity regulatory commissions to determine tariffs suo motu.
Transmission expansion
In line with its energy transition goals, the CEA released a comprehensive transmission plan in March 2026 for the integration of over 900 GW of non-fossil fuel capacity by 2035-36. The plan identifies key renewable energy zones across Rajasthan, Tamil Nadu, Madhya Pradesh, Ladakh, Assam, Gujarat, Andhra Pradesh, Karnataka, Telangana and Maharashtra.
In December 2025, the CEA released a Rs 6.42 trillion master plan for evacuating nearly 76 GW of hydropower and pumped storage capacity from the Brahmaputra basin. The plan envisages around 31,397 ckt km of transmission lines, including nearly 21,000 ckt km of HVDC corridors and 109,935 MVA of substation capacity. The first phase up to 2035 covers about 9,922 ckt km of lines and 41,760 MVA of substation capacity.
Draft NEP 2026
The Draft National Electricity Policy (NEP), 2026, released by the Ministry of Power (MoP) in January 2026, recognised that tariffs in several states remain below the cost of supply, contributing to revenue gaps and rising debt among distribution utilities. The draft policy therefore focuses on tariff rationalisation, power procurement cost optimisation and aggregate technical and commercial loss reduction. The draft proposes a flexible and consumer-oriented transmission system, with greater emphasis on strengthening intra-state networks. It also proposes locating new coal plants closer to mines and planning rail links, conveyor belts and other transport infrastructure in advance. Addtionally, it calls for coal quality monitoring on an “as-delivered at plant-end” basis.
Cybersecurity, data sharing and DPI
Marking a significant step towards creating digital public infrastructure (DPI) for the power sector, the MoP, in February 2026, released Version 0.3 of the India Energy Stack (IES) architecture and strategy documents. The IES aims to build open, interoperable and secure DPI for the power sector, enabling seamless participation, innovation, and efficient coordination among various stakeholders.
In August 2026, the CEA notified the CEA (Cyber Security in Power Sector) Regulations, 2026, which will come into effect from April 1, 2027. The regulations cover entities operating OT infrastructure connected to the interconnected power system and associated IT systems. For generating companies, captive generating plants and energy storage systems, the provisions apply to installations of 50 MW and above.
The MoP’s Draft National Electricity Data Sharing Framework, 2026, released in June 2026, seeks to address fragmented power sector data by establishing common principles for data classification, governance, protection and sharing across generation, transmission, distribution, grid operations and regulatory agencies. The framework proposes a National Electricity Data Centre and a national electricity data portal to enable standardised, machine-readable and interoperable data sharing, while retaining data ownership with the respective entities.
Overall, the past year has seen policy and regulatory efforts aimed at creating a more financially sustainable, competitive, reliable and digitally secure power sector. The proposed reforms across distribution, transmission, generation, nuclear energy and captive power are expected to shape the sector’s development as India integrates higher levels of renewable energy to meet growing electricity demand.
Akanksha Chandrakar
