A man is silhouetted as he walks under electricity transmission poles operated by Maharashtra State Electricity Distribution Co. in Malegaon, Maharashtra, India (Photographer: Dhiraj Singh/Bloomberg)

PM Unveils ‘Power For All By 2019’ Scheme

Prime Minister Narendra Modi unveiled a scheme to ensure that every house in the country has electricity by March 2019 as about a fifth of 120 crore Indians are estimated to have no access to power.

The government introduced the Rs 16,320-crore Pradhan Mantri Sahaj Bijli Har Ghar Yojana-Saubhagya (Hindi for ‘easy access to power for every house – a good fortune’) to ensure electricity in all urban and rural households, according to a statement released by the government.

Poor households will get free connections and will be identified based on the 2011 socio-economic and caste census. Unelectrified households not covered under the data will have to pay Rs 500 in 10 instalments to power distribution companies.

PM Unveils ‘Power For All By 2019’ Scheme

Per capita energy consumption in India is a third of the global average and some 24 crore people have no access to electricity, according to International Energy Agency’s 2015 energy outlook report on India. The government already has a Deendayal Upadhyaya Gram Jyoti Yojana for rural electrification which was launched in July 2015.

Power Secretary Ajay Kumar Bhalla told BloombergQuint the new scheme is different from the earlier one as it aims to provide electricity to each house. “As a next step, you have to go to each household to achieve the objective of 24/7 power. This is the right time to bring in another scheme.”

Bhalla said the government is providing free or subsidised connections but consumption will not be free. “Whatever tariff is fixed by discoms is recoverable from all consumers.”

Former power secretary Anil Razdan doesn’t agree. The ‘Power For All’ scheme is a decade old, he said. Earlier, it was focussed on electrifying villages, and now “after having spent tens of thousands of crore, we’ve finally decided to take it to every home”, Razadan told BloombergQuint.

Taking electricity to every home is only one part of the problem; making it sustainable commercial venture is the more difficult part.
Anil Razdan, Former Power Secretary

He said the government will have to look at better payment solutions, including pre-paid meters.

PM Unveils ‘Power For All By 2019’ Scheme

About Rs 14,025 crore has been earmarked for rural households and Rs 2,295 crore for urban houses. States will be required to complete electrification by March 31, 2019, a couple of months before the next general election is expected.

The scheme will be 60 percent (85 percent for special states) funded by the central government, 10 percent by states (5 percent of special category) and 30 percent through loans (10 percent for special category).

An additional grant of 50 percent of the loan amount (5 percent for special states and 15 percent for others) will be released subject to achievement of 100 percent household electrification by December 31 next year.

(Updates an earlier version with power secretary’s comments)