The IIPM Think Tank - Musings

Despite tall claims of a bright future and surplus wattage due to the Indo-US nuclear deal, India faces a shortfall of almost 15% of the demand during the peak hours. With an installed capacity of 128,000 MW, almost all the states face a deficit in power generation. Moves to increase installed capacity through the successive five year plans have failed to take off. The 9th plan could add only 47% of the targeted goal, while during 8th plan, the achievement was of only 54%. During the much hyped 8% economic growth, the achievement has been only 58% till December 2006.

The numerous problems plaguing the power sector in India are perennial. The tardy administrative set up has ensured delays and cost overruns of projects. A classic example is the hydro-electric power generation sector, which is plagued by protests by environmentalists. The functioning projects have resulted in severe deforestation in the catchments, which in turn have caused silting in reservoirs. It is estimated that if corrective measures are not initiated soon, hydro-electric power stations may witness reduction in wattage by almost 20% in the next 15 years and it is the same for thermal power projects.
Our myopic policy for coal has ensured that coal based methane projects haven’t emerged from their gestation. Despite having proven reserves of 80 billion tonnes of coal, there is a slowdown in the production of coal, due to bottlenecks resulting due to the nationalisation in 70s. Coal remains a critical source for the power sector in India, as almost 61% of the installed capacity is thermal. Virtually all the gas based plants are running at close to 60% capacity and the government needs to urgently take corrective measures to remedy the situation. The existing shortage exposes the tall claims of the Ministry of Power in increasing the contribution of natural gas in power generation from 10% to 25% by 2012 AD, confining it to the realm of fantasy. The projection of 20,000 MW from nuclear power by 2020 seems to be an extremely unattainable target. What requires our urgent attention pertains to the highly politicised distribution regime. The politicised and bureaucratic state electricity boards (SEBs) have miserably failed in dealing with theft of power. India loses close to an estimated $12.5b in economic output due to T&D losses (Transmission and Distribution losses!!, a euphemism for power theft or rather dacoity). Though SEBs cannot alone be blamed, private distribution companies have failed to provide a meaningful solution for the honest and law-abiding consumer.

The tolerance to bear the searing heat in summer will have to go up a few notches. A lasting solution to our power woes is a distant dream, what with the sorry state of affairs in the power sector. Armchair climatologists and environmentalists have lost relevance and indulge in a blame game vis-à-vis the West, whom they baselessly accuse of precipitating the energy crisis due to the global warming caused by emission of greenhouse gases. In light of this, I have a simple prescription: brace oneself for the heat and pray to the Almighty for an early monsoon!!