An analytical framework that integrates generation resource outage characteristics and customer value of electricity supply is developed to represent and evaluate reliability of the power system in north India. The composite outage cost function is estimated to be of log-linear form based on the regression analysis of data obtained through extensive customer field surveys in the region. The research illustrates that potentially higher direct outage costs have been displaced by relatively lower adaptive response investments to counteract the impact of interruptions. The implicit reliability of the country＇s generation capacity plan through 2000, used along with the outage cost estimates, gives an interrupted energy value, a customer-value-based reliability index, of 2.30 Rupees per kilowatt-hour not served in 1990 ($US 1990 = Rupees 17.50). The outage cost-based reliability planning criterion provides an optimal level of reliability equivalent of 9.1% loss of load probability (LOLP). A comparison reveals that the generation capacity program is unreliable in the beginning but becomes overly reliable toward the later years of the plan.