Putting citizens at the centre of power reform

This article is authored by Vaibhav Chowdhary and Gaurav Bhatiani.

For decades, electricity in India has been about supply, not choice. We have built mega-generating stations, transmission grids, and expanded distribution networks. Yet, for the common man, electricity remains a take-it-or-leave-it deal. One supplier, one tariff, no exit. And if the power goes out: Too bad.

Electricity demand(Unsplash/representational)

Whether distribution companies (discoms) respond to complaints, ensure reliable power, or bill fairly, you have no say. No alternative. No way out. You’re stuck with a monopoly. Now ask yourself: In the world’s largest democracy, why should an essential service such as electricity offer no consumer choice?

It’s time to flip the switch not just in our homes, but in our thinking: from monopoly to democracy.

India’s power sector is ripe for Reform 2.0. Not just technical upgrades or financial bailouts we’ve tried those. A complete shift in mindset is essential, from protecting inefficient monopolies to empowering citizens. The recently proposed Electricity Amendment Bill, 2025, offers such an opportunity.

To most people, electricity reform remains mired in jargon — unbundling, privatisation, and regulation mean little to them. The ordinary consumer, whether a shopkeeper in Sirsa or a household in Hosur, remains voiceless and forgotten, treated more as recipients rather than valued customers.

Discoms enjoy monopoly rights, with no competition. Their accumulated losses exceed ₹7.0 lakh crore. Such chronic underperformance would face serious consequences from customers in any other sector. In the power sector, however, unreliable supply, indifferent service, and opaque billing persist at the expense of the consumer, with no compensation for poor performance.

Even with liberal performance ratings, most utilities fall into the B, C, or D categories. Yet, there is no market pressure, no penalties. No wonder there’s little incentive to improve.

Now, imagine a different future.

Your electricity bill is too high. You log into a portal and switch to another supplier offering lower rates and better service. They even offer to finance a rooftop solar system to cut your bills. You can opt into an Energy Savings Incentive Plan, earning credits for reducing consumption during peak hours. If there’s an outage, compensation is automatic. Poor service means losing customers — as it should in any market.

This isn’t fantasy. It’s exactly how telecom, gas, and airlines evolved once monopolies were dismantled. Companies that ignored customer needs have faded into obscurity. Once-dominant monopolies such as MTNL, HMT, and Hindustan Photofilms fell because of their inability to adapt to evolving customer needs and market shifts.

The Electricity Amendment Bill, 2025, could spark a similar revolution. It proposes multiple suppliers in the same area, shared infrastructure, minimum service standards, and timely tariff revisions.

But it must be built on one non-negotiable foundation: the customer comes first.

As Arun Maira notes in Reimagining India’s Economy (2025), real reform begins by listening to people’s lived realities, not imposing top-down targets and templates.

Structured engagement through community advisory panels, local needs assessments, and monthly satisfaction surveys can bridge this gap. Utilities would gain real-time insights into usage patterns, affordability, and reliability, guiding smarter investments — such as upgrading specific feeders or deploying decentralised renewable solutions — and customer-oriented cost-recovery models.

Subsidies create perverse incentives in the sector. Many discoms prefer low-paying customers to exit: A classic monopolist’s response. Yet, the broader developmental and climate benefits of electricity access demand a participatory approach.

Such participation helps bridge the deep disconnect Maira highlights between what planners assume citizens need and what people want and can afford. Service delivery and payment structures must reflect real household conditions and be differentiated to meet customer requirements rather than technocratic assumptions.

Discoms can offer a bouquet of differentiated services and supply options. For example, customers willing to reduce consumption during peak hours could earn savings credits, while those opting for green electricity might pay a premium. Further segmentation could allow for priority service, credit facilities, or other specialised offerings for those willing to pay more. No frills, pay less. Premium plus, pay more.

Reform should enable choice, as genuine empowerment lies in expanding options rather than enforcing uniformity. The success of prepaid and flexible plans in the telecom sector demonstrates that such innovations are both feasible and effective.

Designing services around people builds trust. Publishing customer experience dashboards, tying utility incentives to customer satisfaction, and strengthening grievance redressal forums demonstrate accountability. People support reform—and are willing to pay—when their voices matter and problems solved.

This trust is crucial for the long-term financial sustainability of the sector, especially in a future with competitive retail markets and decentralised energy resources.

India is already pioneering a digital public infrastructure for energy through smart metering, digital payments, and open Application Programming Interfaces (APIs) as evidenced in the India Energy Stack. Combined with a customer-first approach, it can generate immense value through citizen participation.

Such an approach will:

• enshrine customer rights in utilities and regulatory institution
• institutionalise mechanisms for systematic customer engagement, and
• develop innovative, customer-centric products and tariff structures.

Implementing this requires regulators and utilities to listen and act on customer input. Decision-making needs to be decentralised. Technology platforms such as the India Energy Stack can enable personalized services. Together, these changes can expand participation, increase willingness to pay, and drive clean energy adoption, advancing India’s decarbonisation and development goals.

But reform won’t be easy. Incumbent discoms fear losing control. Employees worry about jobs. State governments fear losing political capital. The temptation to delay is real.

So, start with pilots. Cities make ideal testing grounds — they have better distribution networks, higher digital readiness, and more aware consumers. Allow multiple licensees. Launch a simple switching portal. Track outages. Enforce penalties. Report performance transparently. Learn, iterate, expand.

Such an approach builds trust and momentum, not confusion.

We cannot have a Viksit Bharat on an outdated electricity industry. We need a system where power truly belongs to the people. Where the grid serves the citizen, not the other way around.

It’s time to flip the switch — and put people at the centre of power reform.

This article is authored by Vaibhav Chowdhary, director and Gaurav Bhatiani, senior fellow, Ashoka Centre for a People-centric Energy Transition and visiting professor, Indian School of Business.