What India must do to have a modern power grid

A Power Department worker performs maintenance on electrical cables during preparations for Mela Magh on the banks of the River Ganges in Allahabad on Dec. 25, 2011. India's energy infrastructure is unable to match its demand for electricity, with government figures showing approximately 80,000 impoverished Indian villages with no access to the power grid.

Kai Ryssdal: I don't know if you saw the news item yesterday: a blackout in India that had left 300 million people without power. Or, basically, the entire population of the United States. It got -- if you can believe this -- worse today. Three power failures and more than 600 million people without electricity.

Power outages aren't new to India. In fact, a whole backup generator industry has sprung up catering to businesses and the rich. But for the country as a whole, growing as fast as it is, there's a fairly intractable problem: Demand outstripping the power supply.

From the Marketplace Sustainability Desk, Scott Tong reports.

Scott Tong: India's farmers reportedly triggered the disaster. With no rain, they used electric pumps to water crops, overtaxing the local power grid. The failures are believed to have cascaded across northern India. Trains stopped, hospitals canceled surgeries, crematoriums switched from electricity to wood.

I reached English professor Adil Mehdi in New Delhi, just as he lost power again. No word on when it'll return.

Adil Mehdi: Yesterday it took 13 hours. This afternoon it had failed again, for three, four hours. Now it's gone again.

I tried an old joke on him: When you lose the Internet, you're back to 1979. When you lose power, you're back to 1879. He sighed.

Mehdi: Refrigerator doesn't work. A/C is not working. Fans are not working. Not much we can do actually without electricity, because it's quite hot and muggy in Delhi. You tend to sweat a lot.

In a big country growing out of poverty, demand for power for cell phones and appliances is exploding. They need more power plants. But economist Arvind Panagariya at Columbia University says the weak link is the distribution system. It's corrupt. Companies that deliver electricity are losing money because of theft and meter tampering.

Arvind Panagariya: And the most important factor -- of course -- is that politicians love to give free electricity to the farmers.

The result is a paradox. The transmission companies can't afford to buy more power, as much as people want it. So investors won't build more power plants.

It's too soon to know technically what went wrong this time.

But countries with power grid questions – we know who we are -- will be paying attention.

I'm Scott Tong for Marketplace.

About the author

Scott Tong is a correspondent for Marketplace’s sustainability desk, with a focus on energy, environment, resources, climate, supply chain and the global economy.
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You need to look back to the 1990s when private investment of IPP was screwed over to understand why they still cannot make any progress today. Suggest Googling The Indian Electricity Market: Country Study and Investment by Peter M. Lamb as a starting point.

I look to Market Place for information that gets below the surface. Give us some data to go with our story. How much has power generation capability grown in the past decade? How much has industry and household demand changed in the past decade. If power production has not kept pace, why not? What are the factors: private or public power generation, NIMBY, environmental concerns, legal obstacles, rapidly growing consumer demand for power (AC, cell phones, washer/driers, TVs/computers or something even more obscure. Thanks as always for your insights into the world we live.
As a Texas resident, I can relate to power problems. We had rolling brown-outs during a nasty heat spell. Recently, one of our power companies threw in the towel in its efforts to expand nuclear power generation near Houston. Texas/national environmentalist were engaged in lawfare to delay and increase the cost and delay construction. This is extremely ironic as nuclear power has almost zero carbon footprint and the fossil fuel based alternatives are obviously not so clean.

How could you gloss over what will be one of the most important stories regarding business in decades! What investor would depend on India's infrastructure that can't meet demand. Who would consider going over there and starting a business?
I believe they have just written their future and it looks very bad for them and good for us. I Only hope our infrastructure doesn't falter as India's has.

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