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Governance of Indian State Power Utilities : An Ongoing Journey

Author

Listed:
  • Sheoli Pargal
  • Kristy Mayer

Abstract

By the late 1990s, the technical and financial performance of the power sector in India had deteriorated to the point where the Government of India had to step in to bail out the state utilities, almost all of which were vertically integrated state electricity boards (SEBs). Considering that the dismal performance of state utilities reflected internal and external shortfalls in governance, the new Electricity Act of 2003 (EA 2003) mandated the unbundling and corporatization of the SEBs, along with the establishment of independent regulators. This was expected to bring about a more accountable and commercial performance culture, with concomitant results in improved utility performance. The rest of this review is organized as follows. Chapter two summarizes the institutional context and relevant developments over the past two decades. Chapter three focuses on the corporate governance agenda adopted by the government and its implementation, specifically relating to the structure and functioning of utility boards of directors. Chapter four reviews SERC regulatory governance. Chapter five analyzes the correlation between key indicators of the quality of regulatory and corporate governance and utility financial performance. And chapter six concludes.

Suggested Citation

  • Sheoli Pargal & Kristy Mayer, 2014. "Governance of Indian State Power Utilities : An Ongoing Journey," World Bank Publications - Books, The World Bank Group, number 20397, December.
    • Handle: RePEc:wbk:wbpubs:20397
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    References listed on IDEAS

    as
    1. Shirley, Mary M & Xu, Lixin Colin, 2001. "Empirical Effects of Performance Contracts: Evidence from China," The Journal of Law, Economics, and Organization, Oxford University Press, vol. 17(1), pages 168-200, April.
    2. Mary Shirley, 1998. "Why Performance Contracts for State-Owned Enterprises Haven't Worked," World Bank Publications - Reports 11537, The World Bank Group.
    3. Sumir Lal, 2006. "Can Good Economics Ever Be Good Politics? Case Study of India's Power Sector," World Bank Publications - Books, The World Bank Group, number 7032, December.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Jain, Ritika & Nandan, Amit, 2019. "Effect of Electricity Act on tariff gap within the subsidizing sector: The case of India," Energy Policy, Elsevier, vol. 132(C), pages 901-914.
    2. Wang, Chang & Guo, Yue & Yang, Yu & Chen, Shiyi, 2022. "The environmental benefits of electricity industry restructuring in China: Ownership mixing vs. vertical unbundling," Energy Economics, Elsevier, vol. 115(C).
    3. Srivastava, Govind & Kathuria, Vinish, 2020. "Impact of corporate governance norms on the performance of Indian utilities," Energy Policy, Elsevier, vol. 140(C).
    4. Kathuria, Vinish, 2021. "Impact of institutional reforms on the performance of distribution utilities in India – A dynamic panel data analysis," Energy Policy, Elsevier, vol. 158(C).

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