Power for All: Electricity Access Challenge in India (World Bank Studies)

"India has been one of the world's leading developing countries in providing electricity to both rural and urban populations. The country's rural energy policies and institutions have contributed greatly to reducing the number of people globally who continue to lack access to electricity. By late 2012, the national electricity grid had reached 92 percent of India's rural villages, about 880 million people. Yet, owing mainly to its large population, India still has by far the world's largest number of households without electricity. About 311 million people still live without electricity, and they mostly reside in poor rural areas. Among these, 200 million live in villages that already have electricity. Less than half of all households in the poorest income group have electricity. Even among households that have electric service, hundreds of millions lack reliable supply, experiencing power cuts almost daily. Achieving universal access to electricity by 2030 is not financially prohibitive for India. The challenge of providing electricity for all is achievable, ensuring that India joins such countries as China and Brazil in reaching out to even its remotest populations. The estimated annual investments necessary to reach universal access are in the range of Rs. 108 billion (US$2.4 billion) to Rs. 139 billion (US$3 billion). Considering that the country already spends about Rs. 45 billion ($1 billion) a year on new electricity lines through the current government program, the additional investments needed to achieve universal access by 2030 are quite reasonable. Investments are not the only hurdle to providing electricity to those presently without service. Policies will need to be aligned with the principles followed in other successful international programs. The potential benefits of electrification for those without service are quite high. The benefits of lighting alone would approximately equal the investments necessary to extend electricity for all. When households that adopt electricity switch from kerosene lamps to electric light bulbs, they experience an enormous price drop for lighting energy and can have more light for a range of household activities, including reading, studying, cooking, and socializing. Households with electricity consume more than 100 times as much light as households with kerosene for about the same amount of money. The potential value of the additional lighting can be as large as 11.5 percent of a typical household's monthly budget. If universal access is achieved by 2030, the cumulative benefit for improved lighting alone would equal about Rs. 3.8 trillion (US$69 billion) or Rs. 190 billion ($3.4 billion) in annual benefits. This is greater than the cost of providing electricity service, and does not even include such benefits as improved communications, household comfort, food preservation, and income from productive activities. With electric lighting, households can generate more income, and children can have better educational outcomes and income-earning potential. Without quality energy services, households often face entrenched poverty, poor delivery of social services, and limited opportunities for women and girls."