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Electrification and last mile connectivity in Assam

Sentinel Digital DeskBy : Sentinel Digital Desk

  |  2 May 2016 12:00 AM GMT

By Debajit Palit

The NDA government has been saying that the central government is committed to provide affordable, 24 x 7 power to all households by 2019. The task, however, appears easier said than done as currently around 250 million people in India are without electricity access and probably an equal number do not have reliable and adequate supply. It will require a collective effort and push by both centre and the states to address the lacue in the sector to achieve the goal.

In the case of North-eastern states, the Grameen Vidyutikaran application’s dashboard shows 5216 unelectrified villages. Of the total unelectrified villages, Assam has the largest number of 2368 unelectrified villages followed by Aruchal (1578). In February 2006 i.e. immediately after the launch of the Rajiv Gandhi Grameen Vidyutikaran Yoja(RGGVY) by the erstwhile UPA government, there were 11,211 unelectrified villages. Thus approximately 599 villages were electrified per year, which has margilly increased to 608 villages during April 2015 to February 2016 with NDA government at the centre.

In one of the articles in 2004 (village electrification must for economic growth, the Sentinel, 17 November), the author had observed that unless a meticulously designed workable action plan is made exclusively for the region, it may take 10-15 years to electrify all villages in the region.Unfortutely, nothing much has changed since then and the pace at which electrification in taking place in the region, especially Assam, it may be daunting to achieve complete electrification by 2019 unless the central government takes major pro-active steps for the state to achieve the goal of power for all.

What does power for all connote?

Despite continued reiteration of ‘power for all’, the key issue that has continued to remain ambiguous is what defines “power for all”– Is it just about electrification of all villages or it is about all households getting quality electricity services for lighting and running appliances. The NDA government in 2003 launched the Rural Electricity Supply Technology Mission, which was followed by launch of RGGVY in April 2005. However, as power is in the concurrent list, the focus of these programmes has largely been on creating village electricity infrastructure and the task of household electrification was left to the respective state governments to be undertaken through the state electricity distribution utility (discom).

The case of Assam

In 2011, as per Census data, Assam had 38.48 lakh rural households (out of a total of 53.74 lakh households) that were un-electrified or used kerosene as their primary source of lighting. In early 2016, the state reported that the number of “balance un-electrified rural households” is 35.33 lakh households, which is margilly lower than what it was in the year 2011. In terms of percentage, electrified rural households in Assam havereportedly increased from 16.5% to 34.3% in fifteen years from 2001 to 2016, which is the slowest growth among all the north-eastern states except galand. In case of galand, however, the percentage of electrified households, as per official record, is around 65%. The growth of household electrification for the other north-eastern states ranges between 23.7% for Aruchal to 42.2% for Mizoram during the same period.

The less-talked about issue, when it comes to how Assam has electrified over 91% of its villages and yet a good chunk of its rural households remain un-electrified, has everything to do with the dismal governce at the state level in the electricity sector during the last fifteen years, inspite of the major tiol rural electrification programme implemented by the UPA government and continued with renewed vigour by the current NDA government. The power supply situation too remains chronically poor with energy deficit of around 6% during the last year against the tiol average of 2.2%.

The task on hand

The authors’ estimates show that, of the total unelectrified population in the north-eastern states, roughly 2 million might be in completely un-electrified villages and around 20 million are in villages that may have the electric grid or in unelectrified hamlets of electrified villages. The central government has already taken steps to connect the remote unelectrified villages and has reportedly sanctioned decentralised distributed generation projects, in around 1700 villages, where extending the grid may be economically daunting.

The critical task is thus to connect households that are in unelectrified hamlets or in electrified villages. Evaluation studies on RGGVY by TERI and other agencies observe that most above-poverty line households in electrified villages are not taking the connection due to fincial constraints, unclear application procedure and or the perception that electricity services (quantity and quality) will be idequate and they will have to pay the fixed cost whether electricity is available or not. The state government policies need to address these issues to improve the connection rate. For example, the discoms could tie up with the MFIs/rural banks to micro-lend connection cost and the repayment could be made monthly along with the electricity bill. Further, spot connection scheme should be launched for ease of taking connections by the households who find it difficult to do the paperwork. In the West Bengal, such a scheme by the state discom, where the consumers availed new connections for Rs. 379/- created huge impact in increasing the number of electrified households. West Bengal currently has 5% unelectrified rural householdsin 2016 down from around 60% in 2011.

Another important task is also to improve the governce in discoms, especially for improving the metering, billing and collection (MBC) practises. Villagers often complain that they don’t receive bills in time or it takes number of visits to discoms to make payments. Studies undertaken by TERI during the 2000’s indicate that the electricity distribution franchisees were working effectively in Assam to provide better delivery of services, reduce loss and doing MBC practises. As the franchisees operate at the local level, there is also effective complaint redressal and feedback system between the franchisee and consumers. However, it also came to light in 2015 the observation by the CAG, as reported in various newspapers, about the losses incurred by the discom in Assam due to improper setting of bulk supply tariff for the franchisees. TERI in its evaluation report on franchisees, conducted with support from Rural Electrification Corporation in 2011, had suggested that competitive bidding should be the preferred way to determine the bulk supply tariff. The report suggested that the discom could ask the applicant to quote energy charge, line maintence charge and minimum allowable distribution loss and allot the territory to one who can provide higher revenue to the discom, bring down technical loss faster and charge lower maintence costs from discom.

The government should rework the franchise system though ratiol setting of tariffs, formulate clearerterms of reference and linkthe scheme with the Skill India mission for building the capacities of the local youths. This will assist the discom to provide better delivery of services and earn revenue and at the same time address the chronic unemployment problem in the rural areas. The local banks can provide them with initial working capital under the recently announced Start-up and Stand-up India.

(Debajit Palit is Associate Director & Senior Fellow at TERI. Views expressed are persol)

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