Electricity sector, which remained in public domain for long, is everywhere being opened up for private participation. As the deficiencies of public sector are becoming evident, its role in economic activities is being curtailed to enhance productivity and efficiency. The present study strives to analyse the reform initiatives across countries and Indian states in order to suggest a policy framework for Punjab, one of the most advanced Indian states. The analysis of electricity reform process reveals that in developed countries, reforms were initiated to increase efficiency and productivity. In under developed countries, however, they were supposed to get rid of various ills of power sector. In India, sub-optimal scheduling of reforms has failed to yield desired results. The study tends to conclude that total privatisation is not the answer to the woes of Punjab’s and for that reason, for any economy’s electricity sector. Therefore, private participation though needed to complement public investment, must not become the mantra for power sector.