From Free Power to Fair Power: Needonomics Perspective on the Draft Electricity (Amendment) Bill 2025

Prof. Madan Mohan Goel Proponent, Needonomics & Former Vice-Chancellor (Thrice)

 Needonomics School of Thought (NST) believes that the Draft Electricity (Amendment) Bill 2025 offers a timely and crucial opportunity to reform India’s power sector—provided it is debated with an open, ethical, and forward-looking mindset. At the heart of this reform lies a fundamental shift: the transition from free power to fair power, guided by the Needonomics principle of “economics of needs, not greed.”

This approach calls for reorienting the energy policy from populist giveaways to purposeful governance—where subsidies are rational, consumers are responsible, and sustainability is central.

1 Pitfalls of Power Subsidies

For decades, power subsidies have been politically attractive but economically destructive. Initially designed to support farmers and vulnerable communities, blanket subsidies have over time distorted electricity prices, encouraged overconsumption, and deepened fiscal imbalances.

State governments continue to carry the heavy burden of unpaid dues to distribution companies (DISCOMs), many of which operate under persistent financial stress. When electricity becomes “free,” it often loses its perceived value, leading to wasteful use and erosion of accountability.

Nowhere is this clearer than in the over-extraction of groundwater in states like Punjab and Haryana, where free electricity for agriculture has resulted in severe ecological and hydrological crises. What began as a welfare measure has, unfortunately, evolved into an unsustainable economic and environmental model.

2 Needonomics:  Ethical Alternative

Needonomics, an ethical and people-centric framework of economics, provides a sustainable alternative to the subsidy-driven approach. It stands on three fundamental pillars—balance over populism, ethics over expediency, and common sense over political gain.

In the context of power sector reforms, Needonomics advocates pricing electricity according to genuine need. Consumers should pay a fair and affordable price for what they consume, ensuring responsibility, efficiency, and sustainability.

The “user-pay principle”—central to Needonomics—is not anti-poor but pro-people. When individuals contribute even modestly toward the cost of power, they begin to value it, use it judiciously, and contribute to the larger goal of a self-reliant economy. Instead of universal subsidies, targeted support should be extended only to those truly in need—thereby preserving fiscal discipline and environmental harmony.

3 Reform through the Draft Electricity (Amendment) Bill 2025

The Draft Electricity (Amendment) Bill 2025 deserves appreciation for its focus on competition, transparency, and efficiency in the power sector. Its intent to enable multiple distribution licensees and encourage private participation marks a step toward modernization and accountability.

However, privatization must not become synonymous with corporatization. It should be driven by ethics and equity, not exploitation. The Need–Affordability–Worth (NAW) approach of  marketing in Needonomics offers a practical and moral framework for reform:

• Need: Ensure every citizen has access to electricity as a basic human right.
• Affordability: Protect weaker sections through targeted, temporary assistance rather than blanket subsidies.
• Worth: Foster a sense of responsibility and willingness to pay a fair price, promoting voluntary compliance and conservation.

This triad of NAW balances market efficiency with social compassion, aligning perfectly with the spirit of Sabka Saath, Sabka Vikas, Sabka Vishwas.

4 Privatization with Purpose, Not Politics

Privatization of power distribution can succeed only when it is guided by purpose, not politics. The objective must be value creation, not profit maximization. A Needonomics-based model of privatization envisions ethical governance, where citizens are informed, responsible, and participatory stakeholders.

Transparent billing, reduced technical losses, and improved service delivery can restore public trust. When people are treated not as passive beneficiaries but as partners in progress, energy reform becomes both democratic and durable.

5 Political Subsidies and Their Economic Consequences

Across India, political parties continue to misuse electricity subsidies as electoral instruments. The lure of “free power” may win short-term political gains, but it weakens the long-term foundations of economic stability and environmental responsibility.

This populist model discourages investment in renewable energy, undermines innovation, and traps the economy in a cycle of deficits, dependency, and decay. Needonomics calls for replacing this politics of freebies with ethics of fiscal prudence—advocating smart subsidies that are time-bound, targeted, and transparent.

6 Toward Viksit Bharat 2047: Power of Fairness

As Bharat marches toward Viksit Bharat 2047, energy reform must become an ethical enterprise. True development requires not just economic growth but also ecological balance and moral accountability.

The transition from free power to fair power is not about burdening citizens—it is about empowering them. It cultivates self-reliance, encourages conservation, and strengthens national integrity.

By integrating the user-pay principle, rationalizing subsidies, and institutionalizing the NAW approach, India can build a power sector that is efficient, equitable, and enduring. This aligns economic governance with the moral and ecological foundations envisioned in Needonomics.

Conclusion:

Energy must no longer be treated as a political freebie, but as an ethical resource that demands responsibility from every stakeholder. The Draft Electricity (Amendment) Bill 2025, viewed through the prism of Needonomics, offers a historic opportunity to reshape the sector by combining ethics, economics, and ecology. We must replace the politics of subsidy with the ethics of sustainability. Let paying for what we use become an act of national responsibility, not a burden. Only then can Bharat truly illuminate its journey toward Viksit Bharat 2047-powered by fairness, guided by ethics, and sustained by wisdom.