The chief minister described the move as a continuation of his administration’s commitment to accessible and affordable electricity, stating that the subsidy would apply automatically to eligible households. He confirmed that consumers would start benefiting from the revised tariff from 1 August 2025, effectively ensuring the subsidy applies to electricity usage from July onwards.
The decision marks a significant intervention in Bihar’s welfare-driven governance model, adding to a series of populist measures that have previously included rural electrification drives and subsidies for low-income families. Nitish Kumar, who is seeking to consolidate support ahead of the upcoming assembly polls, emphasised that the measure was designed to ease the cost of living burden for ordinary families.
Electricity bills in Bihar have long been a sensitive political issue. Although access to electricity has improved substantially over the past decade, the affordability of power remains a concern for a large proportion of the population. According to the latest energy consumption data, around 80 percent of households in the state consume under 125 units per month, making them eligible for the full subsidy under the new plan.
The Power Department is expected to notify distribution companies about the policy shift by the end of the current week, following which software updates and meter recalibrations will be carried out to ensure seamless implementation. Officials indicated that there will be no need for consumers to apply separately for the benefit, as it will be automatically reflected in their monthly billing.
Senior bureaucrats involved in energy planning have said that the scheme will cost the state exchequer around ₹2,200 crore annually, a figure that has already been factored into the supplementary budget. The government has reiterated that the cost is manageable within the broader fiscal framework, pointing to increased revenue collections and central transfers in the current financial year.
Economists tracking Bihar’s welfare policies suggest that the free power initiative is likely to have electoral implications, particularly in rural and peri-urban areas where energy expenses account for a significant portion of household income. Several political analysts have described the move as both strategic and populist, coming at a time when opposition parties have been attempting to focus attention on unemployment, price rise, and infrastructure shortfalls.
Opposition leaders have criticised the announcement as an election stunt, arguing that the policy lacks a long-term vision for sustainable energy pricing. They have also questioned the viability of funding such subsidies on a sustained basis without compromising infrastructure investment in the sector. Responding to such concerns, officials from the state energy ministry defended the move, stating that the scheme was designed with fiscal prudence in mind and aligned with the government’s broader goal of inclusive development.
The energy infrastructure in Bihar has undergone a steady transformation in recent years, with substantial investments in transmission lines, substation upgrades, and rural electrification. Power availability, which was once intermittent and limited to urban centres, has improved markedly, with state-wide access now touching nearly 100 percent. Despite this progress, quality and consistency of supply remain areas of concern, particularly during the summer months when demand peaks.
State-run distribution companies are expected to see a mixed financial impact from the subsidy. While the scheme ensures guaranteed government reimbursement for the waived units, there are operational concerns over potential misuse or meter tampering. Authorities have indicated that random audits and increased digital monitoring of smart meters will be conducted to prevent revenue loss and ensure that only genuine beneficiaries avail the scheme.
Energy policy experts believe that while subsidies may bring short-term relief to consumers, long-term sustainability of the power sector requires a more holistic approach involving tariff rationalisation, grid upgrades, and promotion of renewable energy. Bihar has made strides in solar energy adoption in schools, panchayats, and public institutions, but large-scale integration into the domestic grid remains limited.
The timing of the announcement is seen as politically astute. With elections drawing closer and parties preparing for high-stakes campaigning, the free electricity promise has quickly taken centre stage in the public discourse. Surveys suggest that direct benefits and subsidies often have a stronger electoral pull compared to abstract policy frameworks, particularly in regions where daily costs continue to outpace household incomes.
Nitish Kumar’s emphasis on continuity — portraying the move as an extension of his longstanding governance style rather than a new direction — may help reinforce trust among existing voter blocs. His administration had earlier introduced free or subsidised electricity connections under the Saubhagya and Har Ghar Bijli schemes, helping raise electrification rates dramatically across the state.