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Metering of agricultural power supply in West Bengal, India: Who gains and who loses?

Author

Listed:
  • Mukherji, A.
  • Das, B.
  • Majumdar, N.
  • Nayak, N.C.
  • Sethi, R.R.
  • Sharma, B.R.
Abstract
As a part of the ongoing power sector reforms in India, the state of West Bengal is in the process of metering agricultural electricity supply. This paper presents a first cut assessment of this initiative. Results suggest that the majority of the pump owners benefit from the reforms in two ways: first by having to pay a lower electricity bill for same usage and second through increased profit margins by selling water. This is because in response to the changed incentive structure, water prices rose sharply by 30-50% immediately after metering. In contrast, water buyers have lost out by having to pay higher water charges and face adverse terms of contract. Impact of metering on operation of groundwater markets and volume of groundwater extracted is less clear; they may expand, contract or remain unchanged, though water use efficiency is likely to go up. At current tariff rates, the electricity utilities are likely to earn less revenue than before. These findings are context specific and hold good for West Bengal where high flat tariff had fostered competitive groundwater markets and hence cannot be generalised for other Indian states.

Suggested Citation

  • Mukherji, A. & Das, B. & Majumdar, N. & Nayak, N.C. & Sethi, R.R. & Sharma, B.R., 2009. "Metering of agricultural power supply in West Bengal, India: Who gains and who loses?," Energy Policy, Elsevier, vol. 37(12), pages 5530-5539, December.
    • Handle: RePEc:eee:enepol:v:37:y:2009:i:12:p:5530-5539
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    References listed on IDEAS

    as
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    Cited by:

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    3. Disha Gupta, 2023. "Free power, irrigation, and groundwater depletion: Impact of farm electricity policy of Punjab, India," Agricultural Economics, International Association of Agricultural Economists, vol. 54(4), pages 515-541, July.
    4. Namrata Chindarkar & R. Quentin Grafton, 2019. "India's depleting groundwater: When science meets policy," Asia and the Pacific Policy Studies, Wiley Blackwell, vol. 6(1), pages 108-124, January.
    5. Antonio Estache, 2016. "Institutions for Infrastructure in Developing Countries: What We Know and the Lot We still Need to Know," Working Papers ECARES ECARES 2016-27, ULB -- Universite Libre de Bruxelles.
    6. Shah, M. & Chowdhury, S. D. & Shah, Tushaar, 2018. "Pro-poor farm power policy for West Bengal – III: results of ITP’s Monoharpur experiment," Water Policy Research Highlights 311123, International Water Management Institute.
    7. Balasubramanian, S. & Balachandra, P., 2021. "Effectiveness of demand response in achieving supply-demand matching in a renewables dominated electricity system: A modelling approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 147(C).
    8. Reena Badiani-Magnusson & Katrina Jessoe, 2018. "Electricity Prices, Groundwater, and Agriculture: The Environmental and Agricultural Impacts of Electricity Subsidies in India," NBER Chapters, in: Agricultural Productivity and Producer Behavior, pages 157-183, National Bureau of Economic Research, Inc.
    9. Gupta, Disha, 2024. "Pricing Farm Electricity, Water Use and Efficiency: The Case of Paddy Cultivation in Punjab," IAAE 2024 Conference, August 2-7, 2024, New Delhi, India 344328, International Association of Agricultural Economists (IAAE).
    10. Sharma, Bharat R. & Amarasinghe, Upali & Ambili, G. K., 2010. "Tackling water and food crisis in South Asia: insights from the Indo-Gangetic Basin. Synthesis report of the Basin Focal Project for the Indo-Gangetic Basin," IWMI Research Reports H044046, International Water Management Institute.
    11. Sudatta Ray & Hemant K. Pullabhotla, 2023. "The changing impact of rural electrification on Indian agriculture," Nature Communications, Nature, vol. 14(1), pages 1-12, December.
    12. de Fraiture, Charlotte & Giordano, Meredith, 2014. "Small private irrigation: A thriving but overlooked sector," Agricultural Water Management, Elsevier, vol. 131(C), pages 167-174.
    13. Sarangi, Gopal K. & Mishra, Arabinda & Chang, Youngho & Taghizadeh-Hesary, Farhad, 2019. "Indian electricity sector, energy security and sustainability: An empirical assessment," Energy Policy, Elsevier, vol. 135(C).
    14. Sarkar, Anindita, 2020. "Groundwater irrigation and farm power policies in Punjab and West Bengal: Challenges and opportunities," Energy Policy, Elsevier, vol. 140(C).
    15. Ram Fishman & Upmanu Lall & Vijay Modi & Nikunj Parekh, 2016. "Can Electricity Pricing Save India’s Groundwater? Field Evidence from a Novel Policy Mechanism in Gujarat," Journal of the Association of Environmental and Resource Economists, University of Chicago Press, vol. 3(4), pages 819-855.
    16. Aditi Mukherji, 2022. "Sustainable Groundwater Management in India Needs a Water‐Energy‐Food Nexus Approach," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 44(1), pages 394-410, March.
    17. Sidhu, Balsher Singh & Kandlikar, Milind & Ramankutty, Navin, 2020. "Power tariffs for groundwater irrigation in India: A comparative analysis of the environmental, equity, and economic tradeoffs," World Development, Elsevier, vol. 128(C).

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