Report of Indian Institute of Public Administration ... - Ministry of Power

Madhya Pradesh
and rationalisation of tariff in the power sector. This has been aimed at by
mobilising additional resources in the sector, promoting competition, adoption
of IT in the power sector and harnessing its benefits by bringing transparency in
the system, creating consumer-friendly atmosphere and making the sector
consumer-oriented. The aim of the reform could be achieved by improving the
technical and commercial performance of the distribution sector. Recently,
efforts have been initiated by the Ministry of Power to improve the distribution
sector that was neglected in the past and was exhibiting a poor performance.
APDRP was launched which focussed attention specifically on strengthening and
improvement of sub-transmission and distribution (ST&D) systems and its
commercial health. There is a need to consider other strategies to achieve the
above objective.
ii) Involving the public at large in controlling electricity thefts through social
awareness can further strengthen the reform process. The same can be
implemented by providing discounts in the electricity bills of the consumers
either on an area or feeder basis that helps the Utilities in controlling/eliminating
electricity thefts. It would help in creating a better public consciousness about the
need for cultivating social responsibility. Such a cultural change is extremely
important for effectively addressing the menace of electricity thefts, which is the
single largest factor responsible for overwhelming losses suffered by the
Utilities, and thereby depriving the consumers of the benefits of lower tariffs.
This may be done by the Utilities in consultation with the Electricity Regulatory
Commissions or by suitable amendment to the National Tariff Policy.
iii) Imperatives of gradualism in the approach as seen in some of the States should
be reviewed. The consequences of gradualism have given a space to those who
are opposed to reforms Effective strategy should be designed to counter the
opposition to reforms.
iv) The most significant lesson from the reform study is that power sector reform
needs continued support from the Government both in terms of financial support
and institutional and independent regulatory development. States like, Madhya
Pradesh have committed financially for restructuring the power sector during the
transition period to enable the Utilities to achieve a turnaround. The State should
commit on the reform choices as regard competition, privatisation, etc.
Discussion with the State Governments indicate that private sector participation
is not a closed option but the more immediate concern is about the existing
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