Rajasthan has been recognised as one of the two leading states that have vigorously pursued power sector reforms. The focus of these reforms is to provide an environment that is conducive for private sector participation. The key components of the power sector reforms are as follows:

Management of demand to conserve and promote efficient use of energy and ensure environmental protection.
Tariff reforms. First-level revision in tariffs has already been approved by the State Cabinet.
Establishment of an independent regulatory commission to regulate the functioning of the power sector on sound commercial principles.
Unbundling the State's electricity board into separate, Government-owned generation, transmission and distribution companies.
Promotion of competition among various power sector entities.
Corporatisation and commercialisation of the emerging power sector entities to make the power sector attractive for potential investors.
The State Government will retain the role of policy formulation.