Dark clouds are looming large over power producers, who are at the government’s doorsteps crying out for a cash injection. Bailouts have been a recurrent feature as the sector is marred by shortages, operational inefficiencies, high interest costs and cross-subsidies for political gains. When Piyush Goyal was the power minister from 2014 to 2017, energy shortage went down from 42,428 million units to 7,459 million units, power generation grew by 6.4 per cent, while transmission lines rose 26 per cent. Impressively, India turned from being a net importer of electricity to a net exporter. But crediting itself too much will give the government a hangover.

For, structural reforms remain a pipe dream and the benefits of power generation liberalisation are negated by a tightly-regulated distribution business, which generates revenue for the entire electricity value chain. The Electricity (Amendment) Bill, 2014, that allows privatisation, has one last chance left—the Monsoon Session—to see the light of day. Over 95 per cent of power distribution is controlled by state discoms, which have been in disarray for decades. Interestingly, Goyal’s Uday scheme appears fiscally prudent without offering grants or write-downs, but shifting Rs 4 lakh crore worth debt of state electricity boards to state government accounts is like robbing Peter to pay Paul.

Amid an election year, politicians will dangle the carrot—uninterrupted quality power at cheap prices. Almost every incoming government that promised subsidies to farmers, households and industrial users, hoped to keep up its word through reforms including privatisation to spur competitive pricing and by stopping power thefts that bleed discoms, but never got around to doing that. Importantly, reforms in the energy sector—ranging from oil to gas, coal and nuclear—are needed to reduce imports and increase efficiency. Since such an overhaul is easier said than done, the least contesting parties can do is to dump the politics of free power in the interest of the sector’s survival.