11 August 2009
For most of us in the developed world the benefits of electricity come at a single flick of a switch and are available at any time of the day or night. But for millions of people elsewhere in the world, the idea of power 24 hours a day, seven days a week, is hard to imagine.
In India, which has the fifth largest electricity generation capacity in the world, almost half of the population do not have access to an electricity supply and many others have only unreliable access, with shortages and sudden power losses a part of everyday life. To blame is an under-resourced, badly maintained power sector, vulnerable to energy theft and plagued by defective equipment.
The effects of such an erratic power supply are wide-ranging: businesses grind to a halt when they could be trading, farmers can’t make use of higher tech, more productive machinery, and children’s educational opportunities are restricted. The environment suffers too, as people resort to burning coal for energy, sending toxic gases out into the atmosphere.
Finding the power
The effects of India's defective electricity supply have been especially pronounced in Madhya Pradesh, one of the country's poorest and hungriest states. In 2005/06, nearly half the state’s power was lost to leakages and theft, leaving millions without access. The state government was forced to spend a third of its budget – over £1 billion – to repair the damage and subsidise the flagging power companies. In a state rife with child malnutrition and extreme poverty, this was too great a portion of the budget to disappear in this way. The power sector was in need of transformation.
Over four years, DFID provided support to give Madhya Pradesh an up-to-date, efficient power sector. In practice this involved helping to reorganise the state electricity board, preparing the ground for regulatory reforms and providing expert technical assistance to power distributors to reduce leakages and carbon emissions.
As a result, millions of pounds of government money were freed up to spend on the state’s most vulnerable people. The power sector has also moved closer to becoming financially sustainable and concrete improvements have been made to essential infrastructure. At long last, more of Madhya Pradesh’s people are becoming switched-on – and are beginning to reap the benefits.
Facts and stats
- DFID’s Madhya Pradesh Power Sector Reform programme provided £11 million between 2005 and 2009. Nearly £297 million of government money was saved during the period of the programme.
- State spending in social sectors increased from £108 million in 2005-06 to almost £181 million in 2008-09.
- Power losses in Madhya Pradesh fell from 44% to 37% over the four years and carbon emissions in the state were reduced by around 38%.
- India is the world’s fourth biggest producer of carbon emissions, with emissions increasing by 33% between 1992 and 2002 (Source: World Bank).
- The Indian government aims to provide all its citizens with reliable access to electricity by 2012.
- One-third of Indian businesses cite expensive and unreliable power as one of their main business constraints (Source: World Bank).