The electricity sector has been suffering for a few years now. Even after enjoying the electricity surplus, the sector is handicapped with extreme corruption. This sector, having a complex structural combination between the private and public authorities with few monopoly centres strewn across the country is plagued with the corruption of various forms. Public auctions and openly competitive biddings which existed to offer a level-playing field and boost performance are now manipulated by collusion between lobbyists. Nepotism and favouritism have become almost inseparable from the discussion surrounding this sector as a few powerful groups use their power to influence the power dynamics Very similar to what is happening in every other sector in India, in the electricity sector to politics and red-tapism has started to play an overwhelming role in serving opportunities to the ones with entities and as a result, compromising development and progress.

Corruption in the electricity sector is entrenched in various levels incurring different kinds of damages. It manifests itself in numerous forms, obstructing growth and development. Usually, in high profile biddings and transactions, state officials in charge of offering contracts to private entities are paid off to favour select few names and in return, they gain from a percentage of the contract’s specified amount. Sometimes those officials are paid in kind to compensate for their collusive contributions. A lot of times these payments are not made directly to favour bidding rather corruption takes place in subtler forms. Payments are made to make transactions swifter and smoother. The abuse of favouritism and manipulation of power also has a few hotspots. Planning and implementation are two major hotspots where corruption prevails in full force. Investments in capital projects for additional electricity generation, a new transmission or distribution lines are influenced by officials by influencing the award of construction contracts in return of kickback of a portion of contract value by inflating the price or reducing the quality of work. Both of which harm the citizens of the country. This results in the private contractor getting paid more than his work’s actual worth. To provide for a kickback for the State officials the suppliers increase the price of their equipment resulting in an overall rise in the cost of projects.

It has been seen again and again that politicians and state officials own companies or have stakes in private companies and take advantage of their positions to help their companies get these contracts. Corruption trickles down to the ground level where officials are sent to cut off electrical lines in return of extra payments or disconnecting electrical lines for extra benefits. Informal operators who don’t occupy the job of meter-reading are delegated with the job so that they can earn an extra buck or two. There is historical evidence that participatory governance creates a long-lasting positive influence on corruption. The Electricity Act of 2003 has provisions which allow for positive participation from the citizens in the control of public sectors and avenues for grievance redressal. The provisions of the Act envisages the function of Central Electricity Authority as a subsidiary of the Ministry of Power and plays a consultative role for the said ministry. Recent positive trends have led experts to believe that there has been an increase in transparency because of it.