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Power play
Dear Minister Goyal

For long there has been the dream of providing power for all. There were wild promises of ensuring this by the middle of the current decade. We submit that you should pursue this goal with vigour and try to realise this within the next ten years.

Tamil Nadu suffered the most due to shortage of power in the last three years. Through 2012-13, all parts of the state outside the Chennai metro suffered power cuts and load shedding that extended to 16 hours and more. The state’s growth suffered and jobs were lost. The recent crisis in Delhi of much lower dimension could get national attention thanks to the Delhi-centric television news medium.

Policy deficiencies have contributed to humongous losses of state-run power generation and distribution companies. There was no dearth of ambitious targets, but in three successive plans – the eighth, ninth and tenth – achievements were less than half the targets set.  Though the additions during the Eleventh Plan was much higher, still it was way below the target set.


Ultra failure of ultra mega projects...

The innovative plan of setting up ultra mega power projects 4000 MW each kindled a lot of hope. Sadly, of the nine UMPPs cleared, only one, of Tata Power at Mundra, is operational. Three more, all allotted to Reliance Power, had just completed financial closures. But even of these, only one is making progress. One witnessed faulty tender conditions and very poor monitoring of implementation. The companies which won the tender blindly agreed for fixed tariff spread over 20 years and resiled on these on grounds of steep increase in the price of coal. Your government should be more circumspect in this regard.

Many of the projects suffered delays due to environmental clearance. Successive ministers at the Environment Ministry were indifferent to timely clearances and sat over files for long. You should address this issue and decide on quick clearances. A similar issue came in the way of expanding production of coal to meet demand.  Thus, despite massive coal reserves, the country had to resort to imports on increasing scale and at very high prices. The stagnation in coal production needs to be attended to with speed.

Lack of coordination between the coal and power ministries was another problem area. Bringing these, as also the Department of Non-conventional Energy under a single minister promises for coordinated work.  

Neyveli Lignite Corporation (NLC) did not receive the attention it deserved despite its profitable operations for decades. Several projects mooted for development on Neyveli lignite remained just on paper. The cash rich NLC, with its excellent track record, can expand capacity with ease.

There is enormous scope for reducing transmission and distribution losses. Tata Power Companies and Reliance have achieved remarkable success in reducing T&D losses in the national capital region from over 50 per cent to single digit in just less than five years. Such an attempt should be extended to other electricity systems in the country.

Uneconomic pricing, particularly the hefty subsidies including supply of power free for agriculture, have contributed to the humongous losses of state electricity boards and power corporations. The Gujarat model of efficient running of power companies through fair pricing needs to be emulated.

Capacity for production of power equipment has increased substantially. State-owned BHEL alone has capacity to produce over 20,000 MW of equipment per year. These manufacturers suffer from want of full load on their plants. You would do well to negotiate favourable terms on promise of full orders on the capacities created.

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