Deen Dayal Upadhyay Gram Jyoti Yojana

A recent analysis revealed that larger, populous villages benefited far more from electrification compared to smaller hamlets.

About Deen Dayal Upadhyay Gram Jyoti Yojana

• Launch Date: 2005
• Objective:To provide and improve electricity access to Indian villages.
• It is a Centrally Sponsored Scheme
• Nodal Agency: The Rural Electrification Corporation (REC)
• Components of the Deen Dayal Upadhyay Gram Jyoti Yojana scheme:
  • Separation of electricity lines for agriculture and non-agriculture facilitates judicious rostering of supply to consumers.
  • Strengthening and upgrading the  sub-transmission and distribution (ST&D) network in rural regions. 
  • Rural electrification was approved in 2013 for completing set targets for 12th and 13th plans.  
    • RGGVY was merged into DDUGJY and its budget was carried forward for new schemes. 
• Coverage: The scheme covered all villages except those using non-conventional energy sources under the Ministry of Non-conventional Energy Sources (MNES).
• Eligibility Criteria: Villages with 300 or more residents were eligible for electrification; those with fewer than 300 people were not.
  • Based on 2011 Census: The analysis relied on the 2011 census, the last complete official data available for India.
  • Electrification Status: By 2022, 597,464 villages were electrified. 
    • In India, a village is considered electrified when 10% of households have access to electricity. 

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Salient Features of Deen Dayal Upadhyay Gram Jyoti Yojana

• Subsidy: 90% government subsidy; states contribute 10% through loans or other resources. 
• State Commitments: Guarantee 6-8 hours of daily power and free connections for BPL families.
  

Key Findings from the Study on Electrification in India

• Village Size: Villages with 2,000 or more people experienced significant benefits from electrification.
• Economic Impact of Electrification
  • small villages (around 300 people), per-capita monthly spending saw little to no change.
  • Larger villages (about 2,000 people) experienced a doubling in per-capita spending, increasing by ₹1,428 ($17) per month.
• Unequal Gains for Small Villages
  • Electricity access helps increase GDP nationally but doesn’t benefit small, remote villages as much.
    • Villages with 300 people saw “zero return” after 20 years, with less than a 27% chance of recouping costs.
    • Villages with 1,000 people had a 13% return, just above the cost-effectiveness threshold.
    • Villages with 2,000 people saw a 33% return and a 90% chance of economic benefits exceeding costs.
• Cost-Effective Options for Small Villages
  • Electrifying small villages is costly and has limited impact on poverty reduction.
    • Small solar systems or mini-grids are more affordable options for remote areas.
  • Grid expansion should focus on larger villages to achieve better economic returns.

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