India Power Sector Diagnostic Review : More Power to India - The Challenge of Distribution
This report reviews the evolution of the Indian power sector since the landmark Electricity Act of 2003 (EA 2003, or EA), with a focus on distribution as key to performance and viability of the sector. While all three segments of the power sector g...
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| Format: | Energy Study |
| Language: | English en_US |
| Published: |
Washington, DC
2014
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| Online Access: | http://documents.worldbank.org/curated/en/2014/06/19726521/more-power-india-challenge-distribution http://hdl.handle.net/10986/18868 |
| Summary: | This report reviews the evolution of the
Indian power sector since the landmark Electricity Act of
2003 (EA 2003, or EA), with a focus on distribution as key
to performance and viability of the sector. While all three
segments of the power sector generation, transmission, and
distribution are important, revenues originate with the
customer at distribution, so subpar performance there hurts
the entire value chain. Persistent operational and financial
shortcomings in distribution have repeatedly led to central
bailouts for the whole sector, even though power is a
concurrent 1 subject under the Indian constitution and
distribution is almost entirely under state control.
Ominously, the recent sharp increase in private investment
and market borrowing means power sector difficulties are
more likely to spill over to lenders and affect the broader
financial sector. Government-initiated reform efforts first
focused on the generation and transmission segments,
reflecting the urgent need for adding capacity and the
complexity of issues to be addressed at the consumer
interface. Consequently, distribution improvements have
lagged, but it is now clear that they need to be a priority.
This report thus analyzes the multiple sources of weakness
in distribution and identifies the key challenges to
improving performance in the short and medium term. |
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