Power To The People

Photo: USAID India

This woman works at home making clothing. Thanks to reliable electricity, she can now work when she wants - even after her children have gone to bed - to generate income for her family.

A small venture capital investment - modest in dollars though risky for a private utility - is reaping major social dividends. Power will soon reach over a million of India's poorest people, after USAID demonstrated that slum dwellers will pay for reliable electricity when they experience its benefits and can get access to vital services. In a trial phase, 800 slum households in Ahmedabad (in the western state of Gujarat) were connected to the power grid. A team of partners - a private electric utility, city government, and local NGOs, supported by USAID - offered residents legal and less costly power connections. Slum residents were no longer dependent on unreliable electricity or the local "mafias" that sell it. With commercially viable services, utility theft dropped from 40% to 10% and the quality of life for residents improved dramatically. The model works. The private utility is now committed to using its own resources to extend it to 200,000 households.

Date: 2004