*Resource and Development Economics, Policy Analysis Division, TERI, New Delhi, India
Resource and Development Economics, Policy Analysis Division, TERI, Bangalore, India
1This paper is based on the work undertaken by TERI along with the International Institute for Sustainable Development as its partner as part of the full-cost accounting activity of the Green Budget Reform component of the Energy Efficiency Project sponsored by the Canadian International Development Agency. Details on this activity are available at <
Various stages of electricity generation inflict costs on society and on the environment, which are often not reflected in the traditional costing of electricity and are referred to as externalities. The assessment of externalities is an important step towards sustainable energy development. This paper seeks to develop a detailed methodological framework for the assessment of electricity externalities in India, with an emphasis on thermal power (specifically coal-based power). In doing so, major international studies in power sector externalities have been reviewed to assess their applicability and relevance in the Indian context. The paper also examines the relevant learnings from the Indian studies. Identifying the data and modelling requirements for the assessment of ‘full costs’ of electricity from fossil fuels in India, the data and research gaps have also been outlined.
