Powering India: The Next-Generation Reforms in Power Distribution Sector

摘要

Indian power sector witnessed several reforms since 1991 and series of reforms after enactment of landmark legislation 'The Electricity Act, 2003'. Although these reforms have significantly contributed to the development of power sector, it has failed to achieve financial viability of the state power utilities. Sustained financial losses of DISCOMs remain a major threat to India's energy security and economic growth. This study determines the factors significantly contributing to the sustained losses of DISCOMs from the detailed literature survey. It also evaluates the impact of power sector reforms post 2003 by SWOT analysis. The study finds that state-run DISCOMs in India have become financially and commercially unviable and unsustainable. Huge commercial losses, un-targeted subsidies, irrational tariff, rampant theft, strong government intervention in tariff setting process have significantly contributed to the sustained financial losses. The paper prescribes the needed policy initiatives for the Next-Generation reforms in the distribution sector.