Power sector reform in Orissa: an ex-post analysis of the causal factors

Abstract

From the early 1990s, dramatic changes have been taking place in the structure of Electricity Supply Industry (ESI) worldwide. The primary reasons for electricity sector reform has however, been different for industrialised and developing countries. The objective of this paper is to study and identify various factors leading to power sector reform in developing countries. The restructuring of Orissa State Electricity Board in India was used as a case study in identifying the various factors. The factors that result in implementation of restructuring are: (a) Contextual factors: They are the primary drivers for initiating reform. The performance of the utility and the conditionalities of the lending agencies are contextual factors. (b) Trigger factor: It is the determining factor that creates a compelling necessity to undergo restructuring. The inability of the government to continue to support the utility acts as the trigger factor. (c) Facilitating factors: They act as facilitators for initiating reform. Support of the government, absence of a powerful lobby, and the support of the top management are facilitating factors.