India recently experienced one of the world’s worst blackouts, with 670 million citizens directly impacted. While media reports have focused on the repercussions from two days of outages, this incident illustrates a much larger, more systemic problem: the need for improved electricity governance.
India’s History of Power Problems
India has the world’s fifth-largest electrical system, with an installed electric capacity of about 206 gigawatts (GW). India initiated power sector reforms in the early 1990s through a range of legal, policy, and regulatory changes. Over the last two decades, some of these reforms have been impressive, but several others weren’t taken. This lack of follow-through has resulted in a growing gap between electricity demand and supply throughout the country. Recent blackouts may have shined a spotlight on this gap, but it’s a situation that’s widespread in India: Not only do 400 million Indians lack access to electricity, but electricity supply is unreliable and of poor quality even in large parts of “electrified” India. In addition to the existing demand, Indian consumers, businesses, and industries seek more electricity to power appliances, processes, and products, further exacerbating the demand-supply gap. By 2035, India’s power demand is expected to more than double.
In looking at the recent blackouts and India’s power supply situation in general, three major governance issues jump out: