Key Findings on Electricity Access in Rural Villages

Source: This post on Key Findings on Electricity Access in Rural Villages has been created based on the article “Access to electricity in rural areas had differential benefits, says study” published in PIB on 11^th Sep 2024.

What in the news?

Recently, an analysis of the Rajiv Gandhi Grameen Vidyut Yojana was done. It showed that larger and more populous villages benefited disproportionately more than smaller hamlets with fewer households

Key Findings on Electricity Access in Rural Villages

1. Smaller villages (<300 people) saw limited economic improvement from electrification.

2. Villages with 2,000 people experienced a doubling of per-capita expenditure by ₹1,428 due to electrification.

3. Smaller villages showed negligible changes in per-capita expenditure.

4. Electrification in smaller villages yielded “zero return” over 20 years.

5. Medium-sized villages (1,000 people) saw a modest 13% return, just above cost-effectiveness.

6. Larger villages (2,000 people) achieved a 33% return, with a 90% chance of exceeding initial costs.

7. Challenges: Electrifying small and remote villages is expensive and often ineffective. Alternatives like solar home systems or minigrids may be more cost-effective.

About Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY)

1. Launched in: Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY) was launched in 2005.

2. Aim: It aim at providing electricity to all rural households.

3. Focus: The scheme primarily focuses on electrifying rural households, especially those below the poverty line.

4. Funding Structure: 90% of the funding is provided by the Central Government and 10% of the funding comes from the Rural Electrification Corporation (REC).

5. Features: The scheme has the following important features:

UPSC Syllabus: Indian Economy