When the Karnataka Electricity Reforms Act was passed in 1999, it promised efficiency, transparency and consumer protection. Two decades later, the reality is mixed. Farmers still face erratic supply, households endure outages and industries shoulder the burden of cross-subsidisation.
The rhetoric of reform is yet to translate into everyday reliability even as the state government makes tall statements of uninterrupted power supply to all. In spite of adequate capacity being available, a fragile, yet essential, green rope needs to be towed.
Karnataka has earned the praise for being a leader in renewable energy generation, with solar and wind projects powering its grid. Yet the state’s green credentials mask a fragile reality. Hydro variability and renewable intermittency force costly short-term purchases, undermining affordability. Without flexible generation and better balancing, the renewable energy promise risks continue to be a burden on consumers. This is because the major concern of transmission and distribution losses and the weak links are yet to be identified and addressed.
Transmission under Karnataka Power Transmission Corporation Limited (KPTCL) and distribution through the various Energy supply corporations limited (Escoms) were meant to professionalise operations. Infrastructure has expanded, but Aggregate Technical and Commercial (AT&C) losses remain stubbornly high.
Farmers benefit from feeder segregation, yet continue to suffer during irrigation cycles. Due to this the households continue to complain of billing errors and outages. Industry leaders also continue to argue and demand details about smart metering, transparent audits and digital asset management.
These are essential to restore consumer trust which the energy department as a whole saw losing this year. Another reason for this was the carry forward burden of the Gruha Jyothi scheme, one of the five guarantee schemes that was launched by the government.
Performance-linked incentives for the Escom staff could also help drive accountability. For, without smart metering and transparent audits, inefficiencies will persist — and consumers will continue to pay.
The Karnataka Electricity Regulatory Commission (KERC) has public hearings, performance standards, and awareness campaigns. For agriculture, it balances subsidies with fiscal sustainability. For households, it insists on fair tariffs. For industries, it promotes open access and time-of-day tariffs. Yet enforcement continued to be patchy, and grievance forums remained slow. This year, just like previous ones.
The industry associations had called for digital grievance platforms with service-level agreements, arguing that faster resolution is critical for both households and businesses. But no solutions were seen.
Industries and commercial consumers, engines of Karnataka’s growth, continued to bear the brunt of cross-subsidisation. Higher tariffs offset agricultural and household subsidies, prompting many firms to migrate to open access or captive generation. This continued to drain Escoms of their revenues and weakened the grid’s financial base. The year also saw trade bodies warning that unless cross-subsidies are phased down, Karnataka will risk losing competitiveness. This is because the Micro, Small and Medium Enterprises, which employ over 1.5 crore people, are particularly vulnerable due to the impact. Rising energy costs and wage pressures have already triggered shutdown threats. Its ripple effects continue to impact across rural economies in the state.
Industrial competitiveness cannot be sacrificed at the altar of subsidy politics. The challenge of shifting revenue and employment concerns was a fine a line that needed to be towed by the sector this year. Industrial consumers once contributed heavily to the state revenue. But now as they are exiting the grid, their fiscal role is now shrinking. Meanwhile, the service sector — IT, finance, hospitality — has become the dominant revenue driver, relying on reliable grid supply. Manufacturing and employment, however, is declining.
Industry leaders argued that targeted energy efficiency programmes, subsidised renewable adoption and tariff structures that reflect employment impact were are necessary to safeguard livelihoods.
Agriculture and household sectors were the real human face of the energy sector this year. For farmers, electricity is a lifeline. Erratic supply leads to crop losses. For households, rising tariffs and outages erode confidence. Protecting these groups is required for reliable feeder supply, targeted subsidies and stronger grievance redressal. The state government should have aggressively tapped into expanding solar pump programmes to reduce dependence on the grid while ensuring irrigation reliability.
The Gurucharan Committee Report that reflected on hard truths for the improvement of the power sector continued to be ignored. The report praised the structural reforms, but flagged inefficiencies. It sought professionalising Escoms, strengthening consumer forums and enhancing transparency. Industry groups echoed these concerns, stressing that governance reforms are not optional but urgent. Without governance reforms, consumer protection remains aspirational. Industrial growth and consumer protection must move together — or Karnataka risks retreating from its reform promise.