Attend to power

Reports that more than half of the country will face serious power shortages this year should cause serious concern. According to Central Electricity Authority (CEA) estimates 17 states will experience severe shortages, with the southern region set to see a deficit of 19.1 per cent.

The worst hit will be Tamil Nadu and Karnataka which are industrial hubs and so there will be a major impact on industrial production in these states. Spot prices of power have shot up in the southern region because of the increased demand. Tamil Nadu, which was once a power surplus state, has been especially hit. Power cuts have extended up to 16 hours a day in that state. In Karnataka the shortage is over 23 per cent. Apart from the inconvenience for domestic users, regular power cuts have crippled small and medium enterprises which cannot afford to install captive units or buy power at higher rates.

The capacity addition projected for this year for the country is about 18,000 mw and much of it has to come from thermal plants. There is acute coal shortage which has cut down generation. India is rich in coal supplies but mining, allocation and transport problems have hit supplies for plants. Ten per cent of the installed power generation capacity is fuelled by gas. There are difficulties in the availability of gas also. The southern region has been especially hit because of the poor grid linkage between the region and the rest of the country. Transmission losses within the grid are very high. Power distribution companies, in spite of all the reforms that have been planned and undertaken, are in poor financial straits. Fresh generation is not keeping pace with demand because of reasons related to policy and investment.  Environmental obstacles have also sometimes come in the way.

Legal and other impediments in the availability of fuel have to be cleared on a priority basis so that installed capacity can be fully used and fresh capacity created. The distribution system should be technically improved. Renewable and unconventional sources of energy need to be tapped more effectively. This is a long-term plan and some steps have been taken to encourage the sector. The results will take time to show. The immediate need is to remove short-term constraints. Power sector woes had a major negative impact on economic growth in the  recent past. Since power is perhaps the most important infrastructure requirement, it calls for more active attention.