Wednesday 12 March 2014

Power Shortage In India

As summer is about to begin in a month or so. Inverter and battery companies are gearing up for a good market share and locking horn with competitors. TV channels are now airing new advertisements of these companies. They are aggressive because they know that their will be a long phase of power cuts from April to July. This is less futuristic approach as compared to launch of electric car e2o by Mahindra. Many of us, including the Mahindra, have realised that power generation from conventional sources is a herculean task when it comes to India. Development can't be done without giving boost to manufacturing sector. Manufacturing sector can function well only when it has adequate power available at cheap rate. The demand for electricity will surely increase but the resources, like coal, will not.
                   In India, there is always a huge gap between demand and availability of electricity. As per the data provided by the Central Electricity Authority (CEA), in 2012-13, against a peak demand of 1,35,453 Megawatt(MW), total power availability was 1,23,294 MW, a deficit of more than 12,000 MW. At normal level the shortage was 7.1% in 2003-04 which increased to 10.1% in 2009-10 and 11% in 2012-13. How can we expect the Indian economy to grow at a rate of even 7-8% if we can't lower this deficit?  The southern states are worst affected. Major cities including Bangalore, Chennai and Hyderabad faced daily power cuts of 10-12 hours in summer of 2013. Same is the scenario with UP, Bihar and north eastern states. But, now there is some relief due to synchronization between southern grid and national grid. Why there are huge gaps in demand and availability of electricity? If we look around we can easily find the reason behind it.
                   In order to meet the increasing demand of electricity every country need to produce power at increasing rate. These power projects are mainly dependent on coal supply. Thanks to the coal scams due to which supply of coal has been deeply affected. As per the document prepared by the finance ministry, power projects worth Rs. 50,000 crore have been delayed due to non availability of coal. Due to shortage of coal, Tata Power and Adani Power were forced to buy coal for their UMPP and Mundra Thermal Power Project from Indonesia at higher prices which resulted in increase in production cost. India has consistently missed the coal production target in 11th plan. In the first year of the plan i.e 2007-08, it missed the target by 4.49 Million Tonnes(MT) which increased to 11.16 MT for the year 2011-12. Even for the 12th plan it is being speculated that a growth of 8% in coal production will not be achieved.
    Same story is with hydel projects. Construction work on most hydel projects have not yet started due either delay in getting green nod or in taking decision. These projects need to get sanctions, permissions and clearances from some statutory bodies, which on an average takes more than 1.5 years. As on 1st Jan, 2014, two projects, Tawang (800 MW) and Tato (700 MW) in Arunachal and Teesta (520 MW) in Sikkim were yet to get environmental clearances. Teesta project was in the queue since 2009. Most of us may be happy that we have achieved fiscal target of 4.8% but we should also see that this target has been achieved by holding capital expenditures that are mainly done for infrastructure development and public welfare activities. Holding these expenditures has delayed many power projects. We must achieve our targets but the way of achieving it should also be considered.
                                               Two major areas in which, to some extent, we can say that we are doing well are Nuclear Energy and Solar Energy. There are some environmental as well as public issues with nuclear power plants. Due to lack of education and awareness, people living nearby nuclear power plants have always opposed the projects. There were some strong protest outside the construction site e.g. Kudankulam Nuclear Power Project where 100 people sat on indefinite fast. But these projects are getting more and more importance because of there potential and size. On 13th Jan. 2014 the foundation stone of 2800 MW nuclear power project was laid by PM Dr. Manmohan Singh at Gorakhpur village of Fatehabad district of Haryana. India has 20 nuclear power reactors with installed capacity of 5780 MW. Seven more are under construction with additional capacity of 6100 MW.
                                                                The contribution of solar power in our country is very less. But this is something where we can excel much. Few state governments and private companies are investing aggressively in solar projects. On 27th Feb, 2014, India's largest solar power plant was launched in at Diken of Neemuch district of Madhya Pradesh with 130 MW capacity. Gujarat is the leader in producing electricity from solar power plants with installed capacity of 224 MW which is expected to be increased to 500 MW by 2014-15. We should take note that Rajasthan and MP have higher percentage of barren land as well as sunlight availability in comparison to other states which provide an edge over other states for producing solar energy. Some other state governments like Karnataka and Maharashtra have also started investing in solar projects. On seeing vast opportunity, many private sector companies including Tata and Reliance have entered in this field . The latest and the most talked move which gained global attention is the Apple's talk with Tesla Motors, an American company that designs, manufacture and sell electric cars. The crisis of power has made us venture in new fields. All we can say is that, although slowly, we are heading towards unconventional sources of energy which is a good sign for our country.