Electricity demand in India is increasing rapidly, and the 1052 billion kilowatt hours gross produced in 2011 was more than triple the 1990 output, though still represented only some 879 kWh per capita for the year 2012. With huge transmission losses – 222 TWh (21%) in 2011, this resulted in only about 774 billion kWh consumption. The government's 12th five-year plan for 2012-17 is targeting the addition of 94 GWe over the period, costing $247 billion. By 2032 total installed capacity of 700 GWe is planned to meet 7-9% GDP growth. The OECD's International Energy Agency predicts that India will need some $1600 billion investment in power generation, transmission and distribution to 2035. To improve financial health of Utilities lot of investments have been made during 11th plan. Government would make further investments in smart grid technologies to reduce the T&D losses to under 15% by end of 12th plan.
There is an acute demand for more and more reliable power supplies. One-third of the population is not connected to any grid. In 12th Plan Government has identified funds for lot of initiatives including smart grid technologies to improve adequacy and reliability of the power system.
Balancing Supply and Demand on the national grid is a constant challenge for operators. Peak consumption periods, and unforseen supply outages can pose significant difficulties.To level peak demand Government of India has set a target of planned energy efficiency and energy conservation to 44.85BU at consumer side by 2016-17 end of 12th plan.