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Mapping PowerThe Political Economy of Electricity in India's States$
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Navroz K. Dubash, Sunila S. Kale, and Ranjit Bharvirkar

Print publication date: 2018

Print ISBN-13: 9780199487820

Published to Oxford Scholarship Online: March 2019

DOI: 10.1093/oso/9780199487820.001.0001

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PRINTED FROM OXFORD SCHOLARSHIP ONLINE (oxford.universitypressscholarship.com). (c) Copyright Oxford University Press, 2021. All Rights Reserved. An individual user may print out a PDF of a single chapter of a monograph in OSO for personal use. date: 09 December 2021

Tamil Nadu Power Sector

Tamil Nadu Power Sector

The Saga of the Subsidy Trap

Chapter:
(p.255) 12 Tamil Nadu Power Sector
Source:
Mapping Power
Author(s):

Hema Ramakrishnan

Publisher:
Oxford University Press
DOI:10.1093/oso/9780199487820.003.0013

Tamil Nadu, one of the wealthiest states in India, has achieved almost universal electrification, and also has the highest renewable energy capacity—both wind and solar—in the country. Over the last three decades, two regional parties—DMK and AIADMK—have alternatively governed the state and are locked into a pattern of competitive populism in which electricity subsidies play a big role. Early on, subsidies were well targeted and were also financially covered through cross-subsidies from other consumers and direct support from the government. By the 1980s, concern for financial discipline of the utility was abandoned, power for irrigation was made free, flat-rate meters were introduced, and growing theft was concealed under the carpet of agricultural subsidies, all leading to the deteriorated quality of supply and even more cross subsidies. Reform efforts did little to change the situation, with the state government controlling the electricity regulatory commission to prevent the ailing utility from reforming itself and protecting it from any competition. Ironically, Tamil Nadu is considered to be a power surplus state now due to falling industrial demand. There are few signs of Tamil Nadu climbing out of this spiral.

Keywords:   electricity, politics, Tamil Nadu, India, power, reform, political economy, regulation, governance, renewable energy, subsidies

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