Addressing the supply-demand gap in India´s electricity market: long and short-term policy options

The aim of this paper is to analyze the power crisis in India as a function of both supply and demand. Given the history of underachievement in meeting the supply-demand gap, we explore some short and long-term solutions both on supply and demand side. In the context of India, these solutions each have certain limitations with respect to feasibility and their usefulness in meeting the energy gap. Adding generation capacity alone will not solve the power crisis in India. Efforts need to be made on the demand side as well, even though demand-side solutions can not replace supply augmentation in satisfying India´s power hunger. So, what short and long-term options are available on the supply and demand sides? What are the limitations of these options? In this paper we explore these questions looking at the historical trend of power supply position in India and also drawing experience from other countries like Brazil. We then evaluate possible policy choices against the policy goals of Indian power sector.