Electricity Sector Reform in India: Case Study of Orissa, Delhi and Karnataka Electricity Sector

摘要

Electricity reform in developing countries has largely been based upon the same ‘standard menu’ thatunderlies reforms in developed countries. A consequence of this is that, reforms in developingcountries are implemented more slowly or have even stalled. Electricity sector in India have beenundergoing significant reforms since nineties. The initial states of the electricity sector when reformingthe industry were very similar across all states in India. Electricity tariff were subsidized to agricultureand domestic consumers due to political motives. Distribution companies had significant technical andcommercial losses and the state utilities were in poor financial health. Most states in India sharedsimilar stories; however, when these states reformed their electricity sector in nineties, we seedifferences in current market structure despite all states starting with similar industry organization. Inthis paper, we carry out an empirical research on the power sectors of three states in India, namely,Orissa, Delhi and Karnataka. These three cases have been selected for their diversity in approaches toelectricity reform. Orissa has a single buyer model with distribution companies privatized; Delhi has awholesale market with distribution privatized, while Karnataka has a hybrid design without anyprivatization in the distribution sector but an unbundled network. What motivated these states toreform? What types of market designs are currently in place and why market designs different in thesestates? We use a conceptual framework on power sector reform in our analysis to answer thesequestions and to explain the differences in sector performances based on the combined effect of marketdesigns and exogenous factors.