Do rural residential electricity consumers cross-subside their urban counterparts?

Santosh Harish and Rahul Tongia examine inequities in supply of household electricity in India, using minute-level data for every feeder across a major utility.  Their model and results indicate disparities in load-shedding equate to a welfare transfer, from the rural areas to metropolitan areas or big cities, in the order of thousands of crores/year.  This is based entirely on avoided costs of procuring peak power, and does not factor in alternatives, opportunity costs, or value of supply (or outages).

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Accompanying the Working Paper are a set of slides summarizing the study as a presentation.

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