An unfortunate consequence of the widespread fascination for econometrics in the
context of the Indian power sector analysis has been the fatality of a consistent, logical
approach to power demand analysis, in the particular confines of its objective
environment. Correlating aggregate electricity consumption and gross domestic
product in the industrialized, advanced, countries where electricity service contributes
significantly to everyday life, social and work life, has become a standard tool of
simple analysis for some obviously general conclusions and is beyond any
methodological error as such there. However, the story is different and turns vicious
with attempts at mapping this methodology on to an alien range in an underdeveloped
power system where the contribution of the service of electricity is insignificant. This
is so even in the industrial sector in India. Adoption of this methodology here then
amounts to correlating the national/state domestic product or industrial product
exclusively with an insignificant input, in violation of the ethics of a consistent and
logical analytical exercise, and results in gross specification error.