The Role of Households in India’s Energy Transition

India’s energy transition has reached an inflection point. For over a decade, policy, investment, and public discourse have been dominated by the supply side: adding renewable capacity, mobilising finance, driving down solar and wind costs, and meeting ambitious national targets. That strategy has delivered results. Renewable energy capacity has crossed 200GW, tariffs have fallen to historic lows, and clean electricity is no longer a technological or financial stretch goal.

Yet the central constraint facing India today is no longer how much clean electricity it can produce, but how effectively the power system can absorb, value, and manage the electricity it already generates. Increasingly, the success or failure of the energy transition hinges on what happens after power is generated: how electricity is consumed, when it is used, how demand responds to price and availability, and how households interact with the grid. Behind-the-meter and demand-side interventions have largely focused on technology delivery, with limited attention to how consumers actually use these technologies. This behavioural blind spot cuts across income groups in urban India. In this new phase, households are no longer peripheral actors. They are at the core of India’s decarbonisation pathway.

The Missing half of India’s Energy Transition

Electricity production remains the largest source of carbon dioxide emissions in India. Within this, the residential sector accounts for roughly a quarter of national electricity consumption, and its share is rising rapidly. Urbanisation, rising incomes, smaller household sizes, and changing lifestyles are driving increased ownership of air conditioners, refrigerators, televisions, digital devices, and electric vehicles. Cooling demand, in particular, is reshaping India’s load curve, creating sharper and more expensive peaks during hot afternoons and evenings.

Patterns of residential electricity use in Indian urban household sector are closely linked to the ownership and operation of heavy-duty appliances which together account for a large share of household electricity demand. Variations in dwelling characteristics and appliance attributes such as capacity, efficiency rating, age, and duration of use often explain differences in electricity consumption more strongly than household size or basic demographic factors.

At the same time, India’s electricity supply is becoming cleaner but more variable. Solar generation peaks during daylight hours, often when residential demand is relatively low, while evening household demand continues to rise after the sun sets. Without changes on the consumption side, this growing mismatch between when electricity is generated and when it is used leads to renewable curtailment, underutilised assets, higher system costs, and continued reliance on thermal power to meet peaks.

This challenge is most acute in cities and rapidly growing secondary cities, where demand growth is fastest and distribution networks are already under stress. These are also the places where the highest demand for affordable housing is expected, driven by migration from rural and semi-rural regions in search of better economic opportunities. While national energy policy and low carbon development strategies have prioritised supply-side decarbonisation, far less attention has been paid to shaping household consumption in ways that support system reliability, affordability, and emissions reduction.

Why Households Matter More than Ever

Households influence the energy transition in three interconnected ways.

First, they shape demand levels and profiles. Decisions around appliance purchases, cooling practices, thermostat settings, maintenance habits, and everyday electricity use determine peak demand and total energy consumption. Individually, these choices appear marginal. Collectively, across tens of millions of urban households, they define the cost, carbon intensity, and reliability of the power system.

Second, households increasingly shape how electricity is supplied, priced, and managed at the edges of the grid. Through rooftop solar, time-of-day tariffs, and smart meters, households are now directly exposed to grid conditions and price signals. In theory, these tools allow households to shift demand, better align consumption with renewable generation, and reduce system costs. In practice, their impact remains limited because most households do not clearly understand tariffs, trust price signals, or have low-effort ways to respond within their daily routines. 

Third, households determine the social legitimacy of the energy transition. If clean energy delivers reliable power, manageable bills, and visible household benefits, public support strengthens. If it brings complexity, perceived unfairness, or declining service quality, resistance grows. A durable energy transition therefore depends as much on household experience as on capacity installed.

The Limits of Price Signals and Smart Meters

India has taken important steps towards modernising electricity pricing. Time-of-day tariffs are being mandated, and smart meters are being rolled out at record speed. These reforms are essential foundations for a flexible, renewable-heavy grid. They enable dynamic pricing, granular data, and the technical possibility of demand response.

However, price signals alone are unlikely to deliver the behavioural shift policymakers hope for. Most households do not track time-varying tariffs, understand which appliances drive peak consumption, or have the time and attention required to constantly adjust usage. Electricity bills typically emphasise cost rather than units consumed, offering little insight into how behaviour links to consumption.

For households whose electricity consumption is already constrained by affordability and power quality, price volatility can further limit effective participation, rather than enabling flexibility. Expecting households to function as real-time energy managers is unrealistic. Without automation and supportive design, dynamic tariffs risk being ignored by those who can least respond, while penalising households with limited flexibility, such as renters, elderly residents, or those working from home.

Behaviour, Convenience, and Everyday Decision-making

Evidence from Indian cities shows that awareness is not the binding constraint. Many consumers recognise energy-efficiency labels, have heard of rooftop solar, and express concern about rising electricity bills. Yet adoption of low-carbon technologies and practices remains uneven.

Behavioural research highlights several recurring patterns. Present bias leads households to prioritise lower upfront costs over long-term savings, discouraging purchases of five-star air conditioners or refrigerators. Misperceptions about performance persist, with some consumers doubting whether efficient appliances cool as effectively or fearing higher maintenance costs. Convenience and habit inertia dominate daily electricity use, making actions such as switching off appliances or adjusting thermostat settings feel effortful.

Social norms also matter. Rooftop solar adoption accelerates when it becomes visible in a neighbourhood and associated with modernity, reliability, or status. Conversely, negative word-of-mouth from early adopters who faced complicated installation processes can stall uptake for years. Trust in vendors, utilities, technology, and government processes strongly influences household willingness to invest.

From Information to System-friendly Behaviour

If households are to support India’s energy transition, policy must move beyond information campaigns and price signals towards enabling system-friendly behaviour.

First, low-carbon choices must be made easier, not merely cheaper. Streamlining rooftop solar approvals, standardising vendor certification, technology benchmarking, simplifying subsidy processes, and improving after-sales support can reduce the friction that deters adoption. Reducing administrative “sludge” often matters more than marginal financial incentives.

Second, information must be actionable. Electricity bills and digital interfaces should clearly show units consumed, appliance-level insights where possible, and simple comparisons with past usage or similar households. Feedback works best when it is visual, timely, and easy to interpret.

Third, automation is critical. Smart thermostats, default temperature settings, smart plugs, and managed electric vehicle charging can shift demand without requiring constant attention from households. Automation allows households to contribute to grid flexibility passively, preserving comfort and convenience.

Fourth, social influence should be deliberately harnessed. Community-level programmes, visible early adopters, and narratives that frame efficient energy use as modern, responsible, and aspirational can accelerate behavioural change far more effectively than technical messaging alone.

A Household-centred Transition for Emerging Cities

India’s energy transition is now shaped less by how much clean power is built and more by how electricity is used in homes. The decisive arena lies inside households, in everyday decisions about cooling, appliance use, rooftop solar adoption, and responsiveness to time-varying tariffs. Yet these decisions are conditioned by income, education, housing conditions, and the quality of electricity supply, which determine whether households can actively shape consumption or remain constrained by basic service adequacy. Without aligning household behaviour with a cleaner and more flexible power system, India risks underutilising renewable capacity while continuing to incur high system costs.

Secondary cities, satellite towns and emerging urban centres offer a practical pathway forward. Compared to large metros, these cities are experiencing faster demand growth with fewer legacy constraints, and closer institutional linkages between utilities, local governments, and communities. This makes them well suited as test beds for household-centred reforms, from behaviourally informed power consumption and improved billing to low-effort automation and demand response.

As residential electricity demand becomes increasingly defined by appliance intensity and consumption patterns, early intervention in appliance standards, replacement cycles, and system-friendly defaults can prevent the long-term lock-in of high demand and carbon intensive consumption patterns. A place-based approach allows solutions to be tailored to local consumption patterns, housing typologies, and social norms, generating evidence that can inform state and national policy. When households are enabled to participate meaningfully, they become central partners in building a reliable, resilient, affordable, and low-carbon electricity system.

Himangka Kaushik is the Energy & Society Research Fellow at Transitions Research, with over seven years of professional engagement across the energy and climate domain and allied sectors, encompassing research, policy analysis, and applied work on emissions, efficiency, and low-carbon transitions. Views expressed are personal.