West Bengal polls: BJP win may reshape power sector, says JM Financial

JM Financial Institutional Securities expects a meaningful shift in West Bengal’s power sector dynamics if the Bhartiya Janta Party (BJP) forms the government following the recent assembly elections. West Bengal has historically been a significant player in India's power sector — home to the country's first thermal power plant, its first rooftop grid-connected solar plant, one of Asia's first utility-scale solar power plants, and the best-performing Purulia pumped hydro project, the brokerage noted.

CESC: Competition risk rises

The most immediate impact of a BJP government in West Bengal could be felt by Calcutta Electric Supply Corporation (CESC), which operates as the sole electricity distributor in Kolkata. For years, electricity tariffs in the city have been mired in disputes — around hikes, high fuel adjustment charges, steep fixed charges, and allegations of non-transparent meter readings — leading to repeated public protests and political confrontations.

The BJP, under the leadership of Suvendu Adhikari — seen as a key contender for Chief Minister — organised protests in July 2024 against high power tariffs, alleging that CESC's monopoly was causing significant financial strain on consumers. Adding to the regulatory pressure, the Central Electricity Regulatory Commission (CERC) rejected CESC's plea to approve a tariff of ₹3.81 per kWh for a 300 MW wind-solar hybrid project from its subsidiary Purvah Green Power, raising concerns around transparency.

A new BJP-led state government is expected to take steps to address public grievances on high tariffs and billing practices. One key measure could be the introduction of parallel licensing — allowing competing distributors to operate in the same area — which could be enabled by the passage of the Electricity (Amendment) Bill 2025.

Coal India: Law and order improvement to aid execution

Coal India's primary West Bengal operations are conducted through its subsidiary Eastern Coalfields (ECL), which accounts for less than 10 per cent of Coal India's total output — approximately 52 MT out of a total 768 MT. ECL has faced persistent operational challenges, including the need to modernise legacy underground mines, manage illegal mining and coal theft, and navigate evacuation constraints.

Coal India is also developing a major surface coal gasification project at the Dankuni Coal Complex in West Bengal, aimed at converting coal into methanol. A BJP government's typical focus on law and order is expected to facilitate faster execution of new Coal India projects in the state, including the gasification initiative.

DVC listing may be expedited

Damodar Valley Corporation (DVC), a central public sector undertaking under the Ministry of Power, has a shareholding structure comprising the Government of India (35 per cent), Bihar (34 per cent), and West Bengal (31 per cent). It operates 6,540 MW of thermal capacity and 147 MW of hydro power, with a transmission and distribution contract demand of 3,393 MVA across Jharkhand and West Bengal. DVC reported revenue of ₹23,900 crore in FY25, Ebitda of ₹55,000 crore, and net profit of ₹1,200 crore.

The Government of India has been in discussions to list DVC on stock exchanges — a process that faced headwinds due to strained relations between the Centre and the previous West Bengal government. An improved relationship between the state and the Centre under a BJP administration is expected to accelerate the listing process.

Electricity (Amendment) Bill 2025

The central government's proposed Electricity (Amendment) Bill 2025 aims to introduce sweeping reforms to India's power sector — including sharing of distribution network infrastructure, parallel licensing to increase competition, and mandated cost-reflective tariffs. These amendments are designed to address the persistent financial losses of state-run power distribution companies, which exceeded ₹6.9 trillion by late 2025, and align industrial tariffs with actual costs to boost competitiveness.

With the BJP now likely governing West Bengal — one of India's largest states — alongside a new government in Tamil Nadu, analysts expect a higher probability of the Bill's passage in the upcoming monsoon session of Parliament.