Section 4(5) in The National Electricity Policy, 2005
5.1Rural Electrification.-5.1.1The key development objective of the power sector is supply of electricity to all areas including rural areas as mandated in section 6 of the Electricity Act. Both the Central Government and State Governments would jointly endeavour to achieve this objective at the earliest. Consumers, particularly those who are ready to pay a tariff which reflects efficient costs have the right to get uninterrupted twenty-four hours supply of quality power. About 56% of rural households have not yet been electrified even though many of these households are willing to pay for electricity. Determined efforts should be made to ensure that the task of rural electrification for securing electricity access to all households and also ensuring that electricity reaches poor and marginal sections of the society at reasonable rates is completed within the next five years,5.1.2Reliable rural electrification system will aim at creating the following:(a)Rural Electrification Distribution Backbone (REDB) with at least one 33/11 kv (or 66/11 kv) sub-station in every Block and more if required as per load, networked and connected appropriately to the State transmission system.(b)Emanating from REDB would be supply feeders and one distribution transformer at least in every village settlement.(c)Household electrification from distribution transformer to connect every household on demand.(d)Wherever above is not feasible (it is neither cost effective nor the optimal solution to provide grid connectivity) decentralized distributed generation facilities together with local distribution network would be provided so that every household gets access to electricity. This would be done either through conventional or non-conventional methods of electricity generation whichever is more suitable and economical. Non-conventional sources of energy could be utilized even where grid conductivity exists provided it is found to be cost effective.(e)Development of infrastructure would also cater for requirement of agriculture and other economic activities including irrigation pump sets, small and medium industries, khadi and village industries, cold chain and social services like health and education.5.1.3Particular attention would be given in household electrification to dalit bastis, tribal areas and other weaker sections.5.1.4Rural Electrification Corporation of India, a Government of India enterprise will be the nodal agency at Central Government level to implement the programme for achieving the goal set by National Common Minimum Programme of giving access to electricity to all the households in next five years. Its role is being suitably enlarged to ensure timely implementation of rural electrification projects.5.1.5Targetted expansion in access to electricity for rural households in the desired time frame can be achieved if the distribution licensees recover at least the cost of electricity and related O&M expenses from consumers, except for lifeline support to households below the poverty line who would need to be adequately subsidized. Subsidies should be properly targetted at the intended beneficiaries in the most efficient manner. Government recognizes the need for providing necessary capital subsidy and soft longterm debt finances for investment in rural electrification as this would reduce the cost of supply in rural areas. Adequate funds would need to be made available for the same through the Plan process. Also commensurate organizational support would need to be created for timely implementation. The Central Government would assist the State Governments in achieving this.5.1.6Necessary institutional framework would need to be put in place not only to ensure creation of rural electrification infrastructure but also to operate and maintain supply system for securing reliable power supply to consumers. Responsibility of operation and maintenance and cost recovery could be discharged by utilities through appropriate arrangements with Panchayats, local authorities, NGOs and other franchisees, etc.5.1.7The gigantic task of rural electrification requires appropriate co-operation among various agencies of the State Governments, Central Government and participation of the community. Education and awareness programmes would be essential for creating demand for electricity and for achieving the objective of effective community participation.
