Algorithms will increasingly define India’s energy future; but the real test is how they will run – Down To Earth

India’s Smart Grid Transformation: A Report on Progress, Challenges, and Alignment with Sustainable Development Goals

Introduction: A Digital Shift in the Power Sector

India’s power sector is undergoing a significant transformation, transitioning from a conventional grid infrastructure to a digitally empowered network. This evolution involves the integration of real-time data, automation, and advanced analytics to manage electricity supply and demand. The National Smart Grid Mission (NSGM) aims to create a secure, sustainable, and digitally enabled ecosystem. This transition is critically linked to achieving several United Nations Sustainable Development Goals (SDGs), particularly SDG 7 (Affordable and Clean Energy), SDG 9 (Industry, Innovation, and Infrastructure), SDG 11 (Sustainable Cities and Communities), and SDG 13 (Climate Action).

Technological Progress and Algorithmic Governance

Advanced Metering Infrastructure (AMI) Deployment

Significant progress has been made in the deployment of foundational smart grid technology. As of mid-2025, India has installed over 40 million smart meters, advancing the development of a nationwide Advanced Metering Infrastructure. This hardware forms the backbone of the smart grid, enabling two-way communication between utilities and consumers.

The Rise of Algorithmic Control

A fundamental shift is occurring from human-led decision-making to governance mediated by algorithms. Artificial Intelligence (AI) and Machine Learning (ML) systems are now being deployed for critical functions, including:

• Load forecasting and prediction
• Dynamic rerouting of electricity supply
• Automated fault detection
• Implementation of dynamic tariffs

State utilities are actively partnering with global technology firms to leverage these capabilities. For instance, the Maharashtra State Electricity Distribution Company Ltd. (MSEDCL) has collaborated with the Global Energy Alliance for People and Planet (GEAPP) to enhance its grid management using AI, ML, and battery energy storage systems.

Challenges to Sustainable and Equitable Implementation

Despite technological advancements, several challenges impede the development of a fully interoperable and equitable smart grid ecosystem, impacting the potential to fully realize associated SDGs.

Governance, Accountability, and Transparency

The shift to algorithmic control raises critical questions of accountability. In the event of an algorithmic error—such as incorrect load dispatch or inequitable tariff application—determining liability is complex. Existing legal and regulatory frameworks have not kept pace with technological advancements, creating a governance gap. A lack of transparency in algorithmic decision-making processes risks undermining operational integrity.

Data Privacy and Consumer Concerns

Smart grids are data-intensive, collecting granular information on consumer consumption patterns. This raises significant concerns regarding data privacy, security, and fairness. A recent survey by the Confederation of Indian Industry (CII) highlighted key consumer anxieties:

1. Accuracy of billing
2. Reliability of meter connectivity
3. Privacy and security of personal consumption data

These concerns are creating resistance and slowing the rollout of smart meters in certain regions.

Regulatory and Implementation Gaps

Key obstacles identified in a March 2025 FSR Global report and other analyses include:

• Lack of Interoperability Standards: Vendor fragmentation and proprietary systems threaten to create technological silos, hindering the creation of a unified grid.
• Insufficient Data Governance: The Electricity (Amendment) Bill, 2022, while introducing structural reforms, fails to adequately address data ownership rights, consumer consent, and algorithmic transparency.
• Cyber-Security Vulnerabilities: The increasing digitalization of the grid exposes it to new cyber threats that require robust defense mechanisms.
• Uneven Implementation: Progress varies significantly by state. In Karnataka, the implementation of smart meters under the Revamped Distribution Sector Scheme (RDSS) has faced delays due to cost concerns. Concurrently, the national transmission authority recently withdrew grid access for 17 GW of delayed renewable energy projects, prioritizing those ready for implementation and highlighting execution bottlenecks.

Aligning Smart Grids with Sustainable Development Goals

SDG 7: Affordable and Clean Energy

The primary driver for the smart grid transition is to support India’s goal of 500 GW of non-fossil fuel capacity by 2030. Smart grids are essential for integrating variable renewable energy sources like solar and wind, thereby advancing SDG 7. They enable the management of intermittent generation and facilitate prosumer models. However, energy storage remains a critical bottleneck. While India requires an estimated 336 GWh of storage capacity by 2030, projections for 2026-27 are only 82 GWh.

SDG 9 & 11: Resilient Infrastructure and Sustainable Cities

The development of a smart grid represents a major upgrade to national infrastructure, directly contributing to SDG 9. This modernized, resilient energy infrastructure is a prerequisite for developing sustainable and smart cities (SDG 11), promising improved reliability and efficiency for urban populations.

SDG 10 & 13: Climate Action and Reduced Inequalities

By enabling a massive scale-up of renewable energy, smart grids are a cornerstone of India’s strategy for climate action (SDG 13). However, the transition also poses a risk to SDG 10 (Reduced Inequalities). If governance remains opaque and the rollout is inequitable, a two-tier energy system could emerge, with a reliable, algorithmically managed grid for affluent areas and a legacy grid for marginalized communities. Achieving energy justice—encompassing distributive, procedural, and recognitional dimensions—is paramount to ensure the benefits of this transition are shared by all.

Policy Recommendations for an Inclusive Smart Grid

To ensure the smart grid transition is both technologically successful and socially equitable, policy must advance in parallel with technology. Key recommendations include:

1. Establish Algorithmic Accountability Frameworks: Mandate transparency, auditability, and human oversight for all critical grid-management algorithms.
2. Develop a Robust Data Governance Regime: Clearly define ownership of consumer energy data, establish rules for its use and sharing, and create clear consent mechanisms.
3. Enforce Systemic Cyber Resilience: Require all distribution companies (DISCOMs), regardless of size, to establish Cyber Security Operations Centers (CSOCs) and undergo regular security audits.
4. Implement Equitable Rollout Strategies: Prioritize states and regions with high levels of energy poverty for smart meter upgrades and demand-response programs.
5. Mandate Interoperability Standards: Accelerate the development and adoption of common standards for grid protocols and communication networks to prevent vendor lock-in.

Conclusion: Ensuring a Just and Intelligent Energy Future

India’s energy future will be shaped not only by power plants but by the algorithms that control them. The transition to a smart grid is an essential step toward achieving the nation’s climate and energy goals. However, this technological leap presents profound challenges related to governance, equity, and accountability. The ultimate test of this transformation is whether the intelligence embedded in the grid serves to empower all citizens and advance sustainable development. To succeed, the governance of the grid must become as smart as the technology that runs it, ensuring a future that is not only efficient but also fair, transparent, and just.

Analysis of Sustainable Development Goals in the Article

1. Which SDGs are addressed or connected to the issues highlighted in the article?

• SDG 7: Affordable and Clean Energy: The article’s central theme is the transformation of India’s power sector to a smart grid. This directly relates to improving energy efficiency, reliability, and integrating renewable energy sources like solar and wind to provide modern and sustainable energy. The goal of achieving 500 GW of non-fossil capacity by 2030 is a key driver for this transition.
• SDG 9: Industry, Innovation, and Infrastructure: The article focuses on a major infrastructure upgrade—the electricity grid. It details the use of innovation and technology, such as smart meters, AI, real-time data, and sensors, to create a resilient and sustainable infrastructure under the National Smart Grid Mission (NSGM).
• SDG 10: Reduced Inequalities: The article raises significant concerns about equity. It warns of a potential “two-tier energy system” where some benefit from a modern grid while others are left on a legacy system. It explicitly calls for an “equitable rollout” that prioritizes states with high “energy poverty” to ensure the transition reduces rather than exacerbates inequality.
• SDG 11: Sustainable Cities and Communities: The implementation of smart grid technologies is highlighted in urban contexts, with cities like Delhi and Bengaluru being mentioned as key areas for deployment. This initiative is part of making urban infrastructure more sustainable, efficient, and resilient.
• SDG 13: Climate Action: The transition to smart grids is presented as a critical step for India to manage its increasing share of renewable energy. By enabling better integration of intermittent sources like solar and wind and facilitating battery storage, the smart grid is a core strategy for achieving national climate goals, such as the 2030 non-fossil capacity target.
• SDG 16: Peace, Justice, and Strong Institutions: The article extensively discusses governance failures and the need for stronger institutions. It points out that regulatory frameworks have not kept pace with technology, citing a lack of laws on data ownership, algorithmic transparency, and consumer redress. It calls for “algorithmic accountability frameworks” and transparent data governance to ensure the new system is just and accountable.

2. What specific targets under those SDGs can be identified based on the article’s content?

• Under SDG 7 (Affordable and Clean Energy):
  1. Target 7.1: Ensure universal access to affordable, reliable and modern energy services. The article addresses this by discussing the promise of smart grids to increase reliability, lower losses, and address “energy poverty.”
  2. Target 7.2: By 2030, increase substantially the share of renewable energy in the global energy mix. The article explicitly states that a primary driver for the smart grid transition is to manage the “growing amount of renewable energy, largely solar and wind” and to help meet the “goal of 500 GW of non-fossil capacity by 2030.”
  3. Target 7.b: By 2030, expand infrastructure and upgrade technology for supplying modern and sustainable energy services for all. The entire article describes this process, detailing the National Smart Grid Mission’s plan to transform the electrical system into a “secure, adaptive, sustainable, and digitally enabled ecosystem” through technologies like smart meters and AI.
• Under SDG 9 (Industry, Innovation, and Infrastructure):
  1. Target 9.1: Develop quality, reliable, sustainable and resilient infrastructure… with a focus on affordable and equitable access for all. The article is about upgrading the electricity grid to be more reliable and sustainable, while also highlighting the challenge of ensuring “equitable access” and avoiding a “two-tier energy system.”
  2. Target 9.4: By 2030, upgrade infrastructure… with increased resource-use efficiency and greater adoption of clean and environmentally sound technologies. The smart grid is described as a technological upgrade to improve efficiency (reducing losses) and enable the adoption of clean technologies (renewables and battery storage).
• Under SDG 10 (Reduced Inequalities):
  1. Target 10.2: By 2030, empower and promote the social, economic and political inclusion of all. The article advocates for this by recommending an “equitable rollout” that prioritizes states with “high energy poverty,” ensuring that the benefits of modern energy infrastructure are inclusive and do not “recreate existing hierarchies in a new digital format.”
• Under SDG 11 (Sustainable Cities and Communities):
  1. Target 11.a: Support positive economic, social and environmental links between urban, peri-urban and rural areas by strengthening national and regional development planning. The article mentions the National Smart Grid Mission and the Revamped Distribution Sector Scheme (RDSS) as national plans that guide implementation in cities (Delhi, Bengaluru) and states (Maharashtra, Karnataka, Rajasthan), reflecting national and regional development planning.
• Under SDG 13 (Climate Action):
  1. Target 13.2: Integrate climate change measures into national policies, strategies and planning. The smart grid initiative is a national strategy (NSGM) directly linked to achieving India’s climate pledge of 500 GW of non-fossil capacity by 2030, thus integrating climate measures into energy infrastructure planning.
• Under SDG 16 (Peace, Justice, and Strong Institutions):
  1. Target 16.6: Develop effective, accountable and transparent institutions at all levels. The article heavily criticizes the current institutional gap, calling for “algorithmic accountability frameworks,” “openness, auditability, and human monitoring,” and a transparent “data governance regime” because existing rules are not updated and operations risk being opaque.
  2. Target 16.7: Ensure responsive, inclusive, participatory and representative decision-making at all levels. The article points to a failure in this area by noting that the Electricity (Amendment) Bill, 2022, does not address “consumer redress” and that algorithmic decision-making lacks transparency, removing decisions from human oversight without proper frameworks.

3. Are there any indicators mentioned or implied in the article that can be used to measure progress towards the identified targets?

• For SDG 7 (Affordable and Clean Energy):
  • Number of smart meters deployed: The article explicitly states, “India has deployed over 40 million smart meters by mid-2025,” which serves as a direct indicator of progress in upgrading energy infrastructure (Target 7.b).
  • Non-fossil fuel capacity: The goal of “500 GW of non-fossil capacity by 2030” is a clear, quantifiable indicator for measuring the increase in renewable energy share (Target 7.2).
  • Battery storage capacity: The article mentions a need for “336 GWh by 2030” against a predicted “82 GWh” for 2026-27, providing a specific metric to track progress on infrastructure needed to support renewables (Target 7.b).
• For SDG 10 (Reduced Inequalities):
  • Rate of smart meter implementation in high energy poverty areas: The article implies this indicator by suggesting an equitable rollout should “prioritis[e] states with high energy poverty for meter improvements.” Tracking deployment rates in these specific areas would measure progress toward an equitable transition (Target 10.2).
• For SDG 16 (Peace, Justice, and Strong Institutions):
  • Consumer satisfaction and concerns: The article mentions a “poll by the Confederation of Indian Industry (CII)” that found consumers “worried about billing accuracy, connectivity issues, and data privacy.” This polling data acts as an indicator of public satisfaction and trust in the new system and the institutions governing it (related to Target 16.6).
  • Establishment of regulatory frameworks: The article’s focus on the absence of laws for “data ownership rights, algorithmic transparency, or consumer redress” implies that the creation and implementation of such frameworks would be a key indicator of progress towards accountable institutions (Target 16.6).

4. Table of SDGs, Targets, and Indicators

Source: downtoearth.org.in