Transforming Electricity Governance in India: Has India's Power Sector Regulation Enabled Consumers' Power?

Transforming Electricity Governance in India: Has India's Power Sector Regulation Enabled Consumers' Power?

By Ashish Khanna, Daljit Singh, Ashwini K Swain, and Mudit Narain
World Bank Policy Research Working Paper 7275, The World Bank, 2015
30 May 2015

Consumers’ participation in regulatory decision-making in infrastructure sectors can be critical to ensure effective regulatory governance. Providing avenues for enabling consumers’ voice in the regulatory process expands the information base available to regulators in their decision-making, and is critical for ensuring sustainability of policy and regulatory decisions. However, in the reform process of many developing countries’ power sectors, the primary focus has been on the sector’s technical aspects, with inadequate effort to improve the experience of consumers, whether through better quality of service or by ensuring their participation in the regulatory process. This shortfall has often undermined the public’s understanding of and demand for reforms, often reflected in political reversal of key policy decisions. This paper examines the level and quality of consumer participation and protection in five states in India through a review of documents, surveys of consumers, and detailed interviews with key stakeholders. As mandated by law, all states have established standards of performance regulations and set up grievance redressal mechanisms; however, these bodies have not reached the desired level of effectiveness. Similarly, although provisions for consumer participation in regulatory proceedings exist, their adoption is often symbolic and without substantive and deliberative participation. Drawing on analysis of the Indian experience and international best practices, the paper recommends a paradigm shift in pursuing enhanced consumer satisfaction and voice in regulatory decision-making as a central objective of power reforms.

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