Choice in Gurugram, a Bill for the Countryside: The Cross-Subsidy Problem Behind Haryana's First Parallel Power Licence

Gurugram's High-Paying Consumers Fund Haryana's Farm Power

DHBVNL's commercial and industrial consumers are a small share of its customers but bring in about 71% of its revenue. That figure explains both why a private distributor wants to enter Gurugram and why the state government is fighting it. Competition in distribution is not only about who supplies the power. It is about who keeps paying for the rest of the state.

Why the Licence Makes Sense for Gurugram Start with the

people waiting. As of October 2025, DHBVNL had 1,08,590 pending applications for new meters and load increases. For a family in a new Gurugram tower or a shop waiting to expand, that backlog means delays and lost business.

HERC's answer is a second supplier with its own wires. Eleven Power must invest Rs 4,716.73 crore over five years, most of it in underground cables and substations and file a protocol within 60 days so consumers can switch without supply interruptions or unpaid dues.

Gurugram's resident groups want reliability comparable to Delhi's. In Mumbai, Tata Power and Adani Electricity already compete in this way.

The Mechanism That Worries the State

Now follow the money. Haryana, like most states, uses a cross-subsidy. Commercial and industrial consumers pay tariffs above the cost of supplying them and that surplus helps fund cheap power for farmers and rural households.

If a private distributor attracts Gurugram's best-paying consumers, DHBVNL loses that surplus. Its costs of serving villages and pump sets do not fall and it still pays for long-term power contracts signed for the customers it has lost.

The gap must then be filled by higher tariffs for those who remain, a larger state subsidy or growing discom losses. The cost of choice in Gurugram would ultimately land in the countryside.

HERC's Safeguard and Its Limits

HERC saw the risk. It required Eleven Power's network rollout to begin in Nuh, one of Haryana's least developed districts, in the first phase. This is a direct test against cherry-picking: the newcomer cannot serve only profitable areas.

But a rollout requirement only governs where cables are laid. It does not ensure that Nuh's consumers switch or that DHBVNL's revenue holds up in Gurugram. And building a second network duplicates huge capital costs that consumers ultimately pay.

The Draft Electricity (Amendment) Bill, 2025 points to a better design: separating carriage from content. One network would be shared and suppliers would compete to sell power over it. Combined with paying farm subsidies directly from the state budget rather than through other consumers' tariffs, this would let Gurugram have choice without making rural power harder to fund.