Falling short

  • 15/06/2008

  • Business India (Mumbai)

Power secretary Anil Razdan feels the churning in the Indian energy sector holds out untold opportunity to the country's manufacturing industry. Speaking at a conference on Key inputs for the Indian power sector for the 11th Plan and beyond organised by the Confederation of Indian Industry (en) in Mumbai last fortnight, Razdan indicated that the massive expansion that had been planned in the country's power capacities was not merely a concept, but a movement to change and act. "India has embarked on unprecedented growth, where the manifold opportunities should not be lost," noted the senior bureaucrat. "While it is a challenge to attain 80,000 mw of power, this target also offers huge opportunities to the manufacturing, and transmission and distribution (t&d) sectors." Specifying that India needed to create additional capacities of 80,000 mw of power during the 11th Five Year Plan (2007-12), Razdan observed that this translated into order placements of 20,000 to 25,000 mw of generation and t&d equipment and and a further 11,000 mw coming up under the captive sector. Underscoring the importance of energy conversion, efficiency and emissions, the power secretary remarked, "Though India's per capita energy emissions were lower as compared to many developed countries, we should adopt least energy-intensive practices across all sectors." Central Electricity Authority (cea) chairman Rakesh Nath informed that the Authority was preparing a national electricity plan for the 12th and 13th Plan periods. Addressing industry concerns, he said that efforts were on to suitably modify the pre-qualification requirements for new players during bidding. On the matter of fixed price contracts, he mentioned that utilities had been advised to jects, actual capacity addition had been only 21,180 mw during the 10th Plan period (2002-07) of the targeted 41,110 mw. This comprised 12,114 mw of thermal, 7,886 mw of hydro and 1,180 mw of nuclear power. The main reasons for the slippages were ascertained to have been delayed supplies and erection by suppliers and contractors, delayed establishment of super critical technologies by state-owned bhel, shortfall in gas supplies, delays in awarding works, denial of escrow cover, and failures in tying up funds and achieving financial closure. With regard to hydel projects, there were delays in clearance, including environmental clearance, and in investment decisions and signing of MoUs, resettlement and rehabilitation drawbacks, unanticipated geological pitfalls, litigation and even law and order problems. "With growing prosperity and a corresponding rise in power consumption, consumers were willing to pay more for power, provided it was reliable and of quality," said en Western Region chairman Banmali Agrawala, who is also executive director of Strategy and Business Development with Tata Power Co. Ltd. He nevertheless maintained that the Indian power sector lacked a cohesive policy for peaking demand, suffered from inadequate forging capacities and was constrained in raising funds both internally and internationally. V. Raghuraman, principal advisor and chief coordinator of en, felt tendering issues needed to be considered more seriously by the government. He also suggested marshalling cooperation from Indian Technology Institutes for manpower development.