Following the largest power outage in history, the blame game is underway in India.

The recent blackout in the northern part of the country left more than 600 million people -- or about 10 percent of the world’s population -- without electricity for several days.

Officials are looking at a variety of factors for the outage, including low water levels at hydro-electric dams (blamed on lower rates of rainfall) and reports that some Indian states were drawing off too much power. 

But a newly released analysis by Standard and Poor’s Rating Services takes the debate a step further, saying that India is playing a risky game. It's trying to satisfy its ravenous domestic hunger for electricity while playing catch-up with its over-taxed utilities.

"The blackout was, in our view, a consequence of capacity growth and infrastructure improvements that severely lag the country's mushrooming demand for power," said S&P analyst Rajiv Vishwanathan.

Along with calls for greater investment and reform in the way India’s energy grid is maintained and managed, the paralyzing blackout brought attention to experts' beliefs that now is the time for the country to make the shift towards more sustainable power sources.

“Decentralized renewable energy sources like wind, solar and microhydropower plants are the answers here,” said environmental activist and energy consultant Shailendra Tshwant, in an interview with The New York Times. 

By concentrating on energy efficiency and working closely with their end-users, said Mark Feasel, director of energy solutions business for Schneider Electric, utilities "can communicate the status of their grid in real-time, and tap capacity from their users when grid issues prevent normal operation.”

Concerns regarding power and the capacity for growth

The blackout is also underscoring concerns about the future of India’s economy and its capacity for growth. “It goes without saying that an outage of this scale translates to huge losses for business and profits,” said Feasel. “In our fast and instantaneous world, just a few minutes of downtime can translate to millions, if not billions of dollars.”

“All major organizations in India are equipped with the requisite power backup system that ensures smooth functioning of day-to-day business operations,” said Ellen Morgenstern, manager of GE’s citizen communications, in an email to GreenBiz. “However, the reality is that there remains a very strong demand for power in India and the government along with key industry players is working towards creating a healthy power demand and supply equilibrium.”

The country's lack of fuel security is also a "major constraint" to its capacity to generate power, Vishwanathan said. "The slow pace of tariff reforms is hindering infrastructure investment at the state level," he added.

Photo of Indian Flag by Vividz Foto via Shutterstock.

Next page: The long-term outlook for investing in India's sustainable energy future