Performance Evaluation in Rural Electrification Sector of India

This paper aims to propose a framework for accessing relative efficiencies of utilities in power sector dealing in rural distribution in India. Despite of numerous initiatives taken to achieve 100% rural electrification by government of India (GoI), 17% rural households remain unelectrified because distribution companies (DISCOMs) perform sub-optimally. Suggesting non-parametric approach of performance evaluation as a remedy to this shortcoming, the current study engages Data Envelopment Analysis (DEA) technique to perform productivity analysis on 27 DISCOMs. The results showed separate benchmarks for different utilities, as their respective efficiency scores were indicated ranging from 0 to 1, 1 being most efficient. The paper discusses policy recommendations in context with results and their inferences.