Accelerated Power Development and Reform Programme

The Accelerated Power Development and Reform Programme (APDRP) is a key reform initiative launched by the Government of India to strengthen and modernise the power distribution sector. Introduced in 2001, the programme was designed to reduce transmission and distribution (T&D) losses, improve the reliability of electricity supply, and enhance the financial viability of State Electricity Boards (SEBs) and power utilities. By focusing on efficiency, accountability, and technology-driven solutions, the APDRP sought to address chronic issues that had long plagued the Indian power sector.

Background and Need for the Programme

During the late 1990s, India’s power sector faced significant challenges including poor financial performance of SEBs, high T&D losses (ranging from 30% to 50%), frequent outages, and inadequate metering and billing systems. These inefficiencies led to mounting fiscal burdens and discouraged investment in the sector.
Recognising the need for systemic reforms, the Ministry of Power (MoP), Government of India, launched the Accelerated Power Development Programme (APDP) in 2000–01, which was subsequently restructured and renamed as Accelerated Power Development and Reform Programme (APDRP) in 2002–03. The restructured programme aimed to link financial assistance from the central government to actual improvements in performance and efficiency at the distribution level.

Objectives of APDRP

The APDRP was conceptualised with the following key objectives:

• Reduction of AT&C (Aggregate Technical and Commercial) losses to below 15%.
• Improvement in reliability and quality of power supply to consumers.
• Strengthening sub-transmission and distribution networks to meet growing demand.
• Implementation of information technology (IT) for energy accounting and consumer service management.
• Financial turnaround of state utilities through accountability and reform measures.
• Promotion of metering, billing, and collection efficiency across consumer categories.

Programme Components and Structure

The APDRP consisted of several interrelated components designed to achieve both infrastructure improvement and institutional reform:

1. Investment Component:
   • Focused on strengthening sub-transmission and distribution networks (up to 33/11 kV level).
   • Included renovation, modernisation, and upgradation of old systems.
   • Supported 100% metering at feeder, distribution transformer, and consumer levels.
2. Reform Component:
   • Encouraged states to implement sectoral reforms, such as unbundling SEBs into separate generation, transmission, and distribution companies.
   • Promoted regulatory autonomy through the establishment of State Electricity Regulatory Commissions (SERCs).
   • Supported tariff rationalisation and improved revenue management.
3. Incentive Component:
   • Central government financial support was linked to demonstrated performance improvement, particularly in reduction of losses.
   • Utilities showing progress were eligible for conversion of loans into grants.
4. Monitoring and Evaluation:
   • Independent agencies were engaged to monitor technical and financial performance.
   • Periodic audits were conducted to ensure effective implementation.

Implementation and Institutional Framework

The Ministry of Power (MoP) served as the nodal authority, while the Power Finance Corporation (PFC) was appointed as the nodal agency for the implementation of the programme. The Central Electricity Authority (CEA) provided technical guidance.
States were required to prepare Detailed Project Reports (DPRs) identifying towns and urban areas with significant commercial and technical losses. Priority was given to high-loss urban and industrial regions.
Funds were released in tranches—initially as loans and later as grants—based on measurable improvements in distribution performance indicators such as loss reduction, billing efficiency, and consumer service enhancement.

Restructuring and R-APDRP

In 2008, the programme was restructured as the Restructured Accelerated Power Development and Reforms Programme (R-APDRP) to strengthen its focus on information technology and performance-linked results. The restructured scheme had two parts:

• Part A – IT Enablement: Focused on establishing baseline data and energy accounting through IT applications, including the creation of GIS-based consumer databases, automatic data logging, and modern metering systems.
• Part B – Strengthening of Distribution Network: Covered physical upgradation of the distribution infrastructure such as substations, transformers, and feeders. Projects under Part B were sanctioned only after successful completion of Part A.

Additionally, a Part C was later introduced to support capacity building, training, and project management activities.

Achievements of APDRP and R-APDRP

The combined implementation of APDRP and R-APDRP resulted in notable improvements in India’s power distribution landscape:

• Significant reduction in Aggregate Technical and Commercial (AT&C) losses in several urban areas.
• Implementation of energy auditing and accounting systems using IT platforms.
• Establishment of GIS-based mapping of electrical assets and consumers.
• Improved billing and collection efficiency through automated systems.
• Enhanced power reliability and quality in urban and semi-urban areas.
• Strengthened institutional framework for distribution reforms and regulatory compliance.

By 2014, most states had completed Part A projects, and baseline data systems were operational in over 1,400 towns. The programme also facilitated the transition to 24×7 power supply initiatives by improving urban distribution networks.

Challenges in Implementation

Despite its achievements, the APDRP faced several operational and administrative challenges:

• Delayed project execution due to weak coordination among utilities, consultants, and contractors.
• Data inconsistency and lack of standardised baseline information.
• Limited capacity of utilities to handle advanced IT systems and energy audits.
• Financial constraints and delays in fund disbursal affecting project momentum.
• Resistance to reform from certain SEBs reluctant to adopt accountability measures.

In some states, high T&D losses persisted despite infrastructural investments, indicating the need for stronger governance mechanisms and behavioural change in power management.

Transition to IPDS

In 2014, the Government of India subsumed the R-APDRP into a new, consolidated programme called the Integrated Power Development Scheme (IPDS). The IPDS continued the reform agenda with broader objectives, including:

• Completion of ongoing R-APDRP works.
• Extension of distribution strengthening to rural areas.
• Enhancement of IT-based consumer services.
• Metering of all consumers and feeders.
• Improvement of urban infrastructure for reliable and quality power supply.

Thus, the IPDS became the logical successor to APDRP, integrating lessons learned from earlier phases of power sector reform.

Significance and Legacy

The Accelerated Power Development and Reform Programme marked a turning point in India’s power sector policy. It shifted the focus from generation capacity addition to distribution efficiency and consumer service improvement, recognising that sustainable power reforms require end-to-end accountability.
Key contributions of the APDRP include:

• Institutionalising energy auditing and accountability across utilities.
• Promoting IT-driven governance in the power sector.
• Encouraging state-level reforms and the creation of independent regulatory bodies.
• Establishing the groundwork for later initiatives such as R-APDRP, IPDS, and Smart Grid projects.