Infrastructure: Energy is an economic infrastructure concept, referring to the physical and organizational systems for the production, transmission, distribution, and use of energy, which is a vital input for India's economic growth. The legal framework is primarily governed by the Electricity Act, 2003, an act that consolidated previous laws like the Indian Electricity Act, 1910 and the Electricity (Supply) Act, 1948. The 1948 Act was enacted post-independence to rationalize supply and established the Central Electricity Authority (CEA) and State Electricity Boards (SEBs). The 2003 Act was introduced to address the mediocre performance of the SEBs and reform the power sector.
The Electricity Act, 2003 works by consolidating laws for generation, transmission, distribution, and trading of electricity. Key mechanisms include de-licensing of most generation activities, introduction of non-discriminatory open access in transmission, and the establishment of independent regulators like the Central Electricity Regulatory Commission (CERC) and State Electricity Regulatory Commissions (SERCs). Electricity is a subject on the Concurrent List of the Constitution, allowing both the Union and State governments to legislate.
The concept connects to the Ministry of Power and the Ministry of New and Renewable Energy. Related legislation includes the Energy Conservation Act, 2001, and the Petroleum and Natural Gas Regulatory Board Act, 2006. A major recent change is the rapid shift towards clean energy, with India achieving over 50% of its installed electricity capacity from non-fossil fuel sources by June 2025, five years ahead of its Paris Agreement target. The draft National Electricity Policy 2026 signals a move towards market mechanisms and greater utilization of existing coal fleets to complement variable solar and wind generation. The Electricity Act, 2003 is also proposed to be amended by the Electricity Amendment Bill to introduce competition in the power distribution sector.