Reforming Electricity Access and End-Use Efficiency Policies in India – A Social Welfare Perspective

Abstract

Social welfare has been believed to be a trickle-down effect of power sector reform policies, and there have been extensive debates on whether the trickle-down happens in reality. Such perceived benefits are arguably not fully realised in an emerging economy like India, where distribution utilities are at the crossroads of financial instability and social obligations related to ensuring universal access and energy efficiency. Hence, this paper delves into existing empirical literature to identify analytical evidence that links electricity access, end-use efficiency, household welfare, the economics of supply, the environment, and regional endowment. Further, policy documents were examined to map the evolution of such interventions and their intended welfare outcomes. Since the existing studies lack a joint evaluation of the social impacts of access and efficiency interventions, we argue for analysing the nexus of electricity access, energy efficiency, and welfare and thereby bridging these disparate streams of literature. Even though there has been a deluge of electricity access and end-use efficiency policies implemented in India with the expectation of delivering societal welfare, there is a dearth of retrospective research examining analytical evidence on the realisation of such an expectation. This study contributes to the limited literature available on empirically established welfare outcomes of access and efficiency reforms in the Indian power sector and attempts to highlight the need for research on analysing the interdependencies between welfare outcomes of these reforms.