This paper analyzes the likely impacts of the major policy reforms unveiled by the Government of India for revamping the country's power sector. The provisions of the new enactment have recently come into force and seek a paradigm policy shift in the form of the Electricity Act 2003. The paper details out the key features of the Act and the likely power industry changes being brought about in the new regime. These changes comprise the structural changes in the power industry as well as the policy issues related to generation, transmission and distribution of power. Also discussed are the other major areas where transformation is sought and impacts are expected: power trading, role of regulator in the new regime, issue of open access, empowerment of the consumers and the environmental issues. (c) 2004 Elsevier Ltd. All rights reserved.