Producers sore over renewable energy policy

These energy producers claim that the policy was drafted without prior consultation, and leans towards supporting a select few. According to the draft, the aim of the policy is to increase generation of renewable energy from 2,400 MW to 6,600 MW by 2014, with an investment of Rs 22,950 crore.

Many of the proposals under the policy, including the setting up of a trust to raise Rs 5,400 crore have not gone down well with several smaller producers of renewable energy. It is their grouse that the move is tilted towards bigger players in the renewable energy market.

In a memorandum submitted to Chief Secretary Sudhakar Rao, the Karnataka Renewable Energy Developers Association has objected to the fact that the government wants to raise Rs 5,400 crore for the development of the renewable energy sector, when no such requirement was seen earlier.

Five years time

The proposal states that the Akshaya Shakti Nidhi Trust will be of five years’ duration and will have a seed money of Rs 500 crore. Initially, the government will transfer share of Rs 100 crore to the Trust as a grant which will be reimbursed from the Green Energy Fund. This Fund is the money that will be collected by levying a cess of Rs 0.05 paise per unit on electricity supplied to commercial and industrial users, which is estimated to fetch Rs 55 crore annually. The association has complained that the huge amounts involved will only lead to more corruption.

The policy also states that it is obligatory for the companies to sell 50 per cent of the electricity generated from the renewable energy projects to the Power Corporation of Karnataka Limited (PCKL). The balance of 50 pc will have to be sold within Karnataka, mandatorily. This is contrary to the provisions of Central Electricity Regulatory Commission on inter-state open access for sale of electricity. Wind energy, for example is a varied energy, where the production is not uniform throughout the year. In the monsoon months, the wind energy is available in plenty, but the government does not purchase it since hydel is much cheaper than the Rs 3.40 per unit quoted. This is the story for the installed wind capacity for the present. The capacity addition planned for wind energy is 2,769 MW over the next five years. Will there be adequate buyers within the State?

Equity offer

Another provision that has rankled the association is the equity of not less than 5 per cent to be offered to farmers, whose land might be acquired for the projects. This equity is in addition to the compensation, re-settlement and rehabilitation offered to the farmers. “How can they expect us to offer equity after paying compensation and measures like offering a job to one person in a family. If they are so concerned, why has the government not done this for its own projects in the State?,” an association member questioned.