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Immediately after independence, under the aegis of BR. Ambedkar the Electricity Act 1948 was enacted. The objective of the 1948 Act was to provide electricity at reasonable prices all over the country and ensure rural electrification. Nearly every state and union territory organized its own vertically integrated electricity board. By 1991, they controlled over 70 per cent of power generation and virtually took care of all transmission and distribution lines within the states, and a national transmission grid company was developed to share power among regions.

This booklet is an effort towards a preliminary appraisal of the privatization of the power sector in India and is aimed at developing base line information about the Indian power sector. Under the Indian constitution, electricity is considered a concurrent subject, meaning that both State and Central Governments have jurisdiction over the sector. The Government of India has taken several initiatives in recent years to revise its policies on power sector.

The blueprint for Power Development which was brought out by the Ministry of Power in August 2001 projecting its vision for the decade 2012 and the Electricity Bill 2001 introduced in the Parliament in September 2001 are the major steps and provide sufficient proof on government thinking and future plans for the power sector. More importantly the government plans to introduce these policy changes on all India level and most of its prescriptions are either based on the limited experience of the past one decade, particularly from the power sector reforms introduced by the Government of Orissa since 1993.

Given the above backdrop the need was felt to see how the power sector has performed in India and to study the alternatives suggested by the Government of India in the Blueprint and the Electricity Bill introduced in the Parliament.