The critical challenges faced by the power sector in India are as follows:
(i) The installed capacity of India to generate electricity is not sufficient to meet an annual economic growth of 7%.
(ii) The State Electricity Boards (SEBs) that distribute electricity suffered a great loss of more than Rs.500 billion due to transmission and distribution of electricity.
(iii) The wrong pricing of electricity like supply of electricity at subsidized rates to agricultural sector and theft of electricity has exaggerated the problems of power sector.
(iv) The high power tariffs and prolonged power cuts is another challenge in the power sector.
(v) The thermal power station faces the scarcity of the raw materials to generate electricity.