January 26, 2003

2003: Highlight # 14

Servicing remote, rural consumers entail high transaction costs for utilities. Can communities manage their power distribution better? Rao and Govindrajan discuss... 

Community Intermediation in Rural Power Distribution

D.N. Rao and S. Govindarajan

Subsidised tariff rates coupled with high geographic dispersion and remoteness makes power supply to rural consumers a loss making proposition. Conventional revenue collection and monitoring systems do not work well in rural areas. This leads to a vicious cycle of increasing neglect of rural power supply and discontentment and non-payment among consumers.

Micro-retailing of rural power supply through recognized user groups called village bidyut sangha has been tried with great success in western Orissa. Micro privatisation has resulted in marked improvement in quality of power supply for consumers and streamlining of revenue collection for the utility.

Now, even local private entrepreneurs are being involved in Orissa and variants of the model are being tried out in other states like Karnataka.

No comments:

Post a Comment