Significant financial losses before State-owned electricity distribution companies (DISCOMs) continues to be a challenge as these losses have been growing at an average rate of 7% per annum since FY2015-16. The magnitude of support required  to address this challenge is substantial enough to elevate the DISCOM financial crisis into a public finance challenge in many states. This article delves into the current predicament faced by DISCOMs due to poor finances. In addition, the primary focus of this piece is on how technological advancements and changes in market structure will further adversely affect DISCOMs’ business unless timely actions are taken. Such impacts will augment the dependence of DISCOMs on fiscal support, thereby intensifying the public finance challenge. The article also underscores the necessity of changes to the role of DISCOMs to help them adapt to the evolving energy landscape. The objective of these changes is to ensure DISCOM viability, alleviate the burden on the state exchequer, and safeguard small consumers who rely on publicly owned DISCOMs for their electricity needs. A version of this article was first published in the Forum of State Studies on the 3rd of March 2024.