The Indian economy uses a variety of energy sources, both commercial and non-commercial. Fuel wood, animal waste and agricultural residue are the traditional or `non-commercial' sources of energy that continue to meet the bulk of the rural energy requirements even today. However, the share of these fuels in the primary energy supply has declined from over 70% in the early 50's to a little over 30% as of today.The traditional fuels are gradually getting replaced by the "commercial fuels" such as coal, lignite, petroleum products, natural gas and electricity.

As the electricity is one of the most important input in the Industrial Sector, the development of the nation is generally compared by the per capita consumption of electricity. In the developing countries, the indicator can not be related directly with the average development of the nation. The use of Electricity is basically done on following accounts :
1) Industrial
(2) Commercial & Residential lighting
(3) Agriculture and Irrigation.

In developing countries, 30% dwellings are yet to be provided with electricity supply higher consumption of Electrical power. The use of domestic electrical equipment is also comparatively very high in developed countries. Harnessed energy has become a symbol of growth and instrument for development. Electric power particularly the hydro is among the cleanest and renewable energy input for economic activity, domestic and civic conveniences, climate control, communication and technology.

The Ministry of Power has set on objective of providing "Power for all by 2012". This will entail electrification of all villages by 2007 and of all households by 2012.

As you are kindly aware, electricity is one of the key infrastructure elements for the economic growth of the country. India since independence have made big strides in the power sector but with per capita consumption of around 600 Kwh per year, we are amongst lowest rungs of the countries in this vital indicator of economic and social development and power cuts are still resorted to even in metro cities what to talk of rural areas. Indian economy, therefore, desperately needs a better functioning power sector which can meet the market demand for quality power at a globally competent rate.

The infrastructure would need the availability of assured and quality power at affordable price through reliable and adequate generation, transmission and distribution facilities. Power generation in India began more than a century ago in 1898 when the first hydro power unit was set up at Darjeeling. When India achieved freedom in 1947, the country had an installed capacity of
1,360 MW.

The present installed (conventional fuel) generating capacity in the country is 1,18,780 MW. The share of hydro with 32,370 MW capacity is about 27%. Thermal accounts for maximum share of 70% with 83,100 MW. It comprises of 63,374 MW from coal, Multi Fuel 1744 MW Lignite Based 3455 MW and 13451.9 MW from Gas and liquid fuel and 1,075.1 MW from Diesel. The share of Nuclear is about 2.7% with 3310 MW.

The attainment is significant. However what we achieved in over 50 years will need to be attained now in nearly 10 years.The present annual energy requirement in 2002-03 was 5,45,674 MU, of which only 4,97,589 MU were available, leaving a shortfall of 8.8%. While the peaking requirement was 81,492 MW in 2002-03, a peak of 71,547 MW only could be met, leaving a shortage of 12.2%.

The 16th Electric Power Survey (EPS) carried out by the Central Electricity Authority has projected a peak demand of 1,15,705 MW and an energy requirement of 7,19,097 MU by the end of 10th Plan while the requirement by the end of 11th Plan has been projected as 9,75,222 MU and 1,57,107 MW respectively.

Attached below is a report on Power Scenario Of India