What problems are being faced by the power sector in India?

Some of the challenges India's power sector faces today are:

(a) India's installed capacity to generate electricity is not sufficient to feed an annual economic growth by 7%. In order to meet growing demand for electricity between 2000 and 2012, India needs 10000 MW of new capacity. At present India is able to add only 20000 MW a year. Even the installed capacity is under-utilized because the plants are not running properly.

(b) State Electricity Boards which distribute electricity incur losses which exceed Rs. 500 billion. It is due to transmission and distribution losses, wrong pricing of electricity and other inefficiencies. Free distribution of electricity to the farmers is the main reason for the losses. Electricity is also stolen in different areas.

(c) Private sector power generators are yet to play their role.

(d) There is general public unrest due to power tariffs and power cuts in different parts of the country.

(e) Thermal power plants which are the mainstay of Indian power sector are facing shortage of raw material and coal supplies.