UPSC CSE Mains Syllabus: GS-3- Infrastructure: Energy, Ports, Roads, Airports, Railways etc.

Recently, the Centre has suggested two major policies to reform the energy distribution sector.  

Reforms suggested:

  1. 1.The reform of power tariff policy — announced as part of the stimulus package.
  3. 2.The recent comprehensive proposal to amend the Electricity Act 2003.


Discoms follow two-part tariff policy, mandated by the Ministry of Power in the 1990s at the behest of the World Bank.

Long term PPA:

Overestimation of demand:

The PPAs signed were based on optimistic projection of power demand estimated by the Central Electricity Authority (CEA).

Factor of renewable energy:

Power demand peaks after sunset:

The Electricity (Amendment) Bill, 2020:

The author of the article argues that,

All these measures will weaken the control of States over an industry supplying a basic human necessity such as electricity but also arm the Centre with a pincer-like weapon which could choke the distribution utilities/companies (DISCOM) and jeopardise the country’s energy security.

(However, from the exam point of view both the pros and cons of these measures need to be analysed before coming to a conclusion.)

Source:” The Hindu“.

Possible UPSC CSE Mains Question:

The recent electricity reforms announced by the Centre may alter the Centre State power balance. Analyse.  Also, discuss whether it will improve the position of the DISCOMS.