Solving Power Crisis in India

In this article we will discuss about the changes required to solve power crisis in India.

Considering the serious power crisis and rapidly growing demand for electricity, a considerable change is required in the structure, operation, regulation and decision making practices currently governing electric power development in India. If the present set up is continued, the country will soon be plunged into deep crisis of growing unsatisfied electricity demand and declining electricity system reliability.

Recently, a study entitled “Planning for the Indian power sector environmental and developmental considerations” is jointly conducted by the Tata Energy Research Institute and Canadian Energy Research Institute.

The study observed, “There is much that can be done to ameliorate these problems, even in the context of the financial and energy constraints facing the country. Adoption and implementation of IRP in the power sector, movement towards cost based pricing principles and creation of an independent regulatory authority to oversee the future expansion and operation of the power system are all important steps towards a secure energy future for India.”

India’s power sector is caught between the pressure to add new generating capacities to match rapidly growing demand for power to fuel its growing economic and social development and the environmental challenges arising from large scale power generation.

Estimates show that new generation capacity of 1,00,000 to 1,50,000 MW will be required during the next 15 years. The study observed that a decentralized electricity generation system offers several advantages in applications where flexibility in system, size and location is desired.

Considerable improvements in reliability, costs and efficiencies of these technologies, together with the rising costs of large scale electricity generation and favourable public policy have resulted in active consideration of dispersed electricity generation options.

Meanwhile, the Government has set an objective of providing ‘Power for All by 2012’ and has also launched a “Mission 2012—Power for All” in this direction. A comprehensive blueprint for power sector development has already been prepared outlining the problems and suggesting integrated solution and strategies for achieving the objective of Power for All.

Control of T&D Losses:

Transmission and Distribution (T&D) losses is a major factor responsible for power crisis in India. Venugopal Dhoot, the then President of the Assocham Eco Pulse (AEP) had once stated that India has a power generation capacity of 1,30,000 MW of which about 40,000 MW is lost because of transmission and Distribution (T&D) loopholes, while the global standard for such T&D losses varies between 5 to 10 per cent only.

Thus India would not be able to solve power crisis if the T&D losses of about 30-40 per cent are not effectively controlled as such losses would reflect heavily on the financial health of power utilities, leading towards deterioration. In fact our T&D losses usually go above 50 per cent.

In 2004-05, 12 states and UTs of India had their T&D losses in excess of 30 per cent. Assam topped the list with 51 per cent T&D losses followed by Delhi and Rajasthan (45 per cent), Madhya Pradesh (41%), Jammu & Kashmir (40%) and Bihar (39%).

A few states were however, very successful in keeping their T&D losses below 20 per cent viz., Pondicherry (18 per cent), Tamil Nadu (19 per cent). However, the T&D losses resulted from power theft and faulty distribution system which could be controlled through stoppage of theft and up-gradation of the distribution system.

Renewable Energy:

The study observed that renewable energy has made insignificant contributions in the country’s over-all energy mix, which is again mostly due to lack of economic viability of renewable energy technologies (RETs) and low budgetary allocations for their promotion.

Between 1880 and 1992, the cumulative Government expenditure in the renewable energy sector totaled Rs. 11.55 billion only as compared to that of Rs 812 billion in the power sector. Rs 335 billion in the petroleum sector and Rs 158.5 billion in the coal sector. Even in the Eighth Plan, allocation for the renewable energy sector represented only 0.8 per cent of the total allocations on the energy sector.

Among other technologies, wind farms have emerged as a viable power sector option. The performance of the wind farms over the past five years shows an average reliability of 98 per cent. The capacity utilization factor is as high as 30 per cent in some locations.

Small hydro project has evolved as another promising option for electricity generation, especially in remote hilly areas where the cost of grid electricity is prohibitive. Total potential of small hydro projects in India is estimated at about 10,000 MW.

Presently, 148 small hydro projects totaling 110 MW have been completed and 166 projects aggregating to 202 MW are being implemented. Main obstacle in promoting this technology has been the high capital cost.

Given the large availability of biomass in India, biomass gasification offers significant potential for meeting energy needs, particularly in rural and remote areas. Future promotion of biomass gasification depends on technology development, improved operation reliability, operating and maintenance costs and biomass prices.

Quoting estimates of the 14th Electric Power Survey, the study observed that electricity demand will grow at a compounded annual rate of 8.3 per cent during the period 1992-93 to 2011-12. It is estimated that Indian power sector can save 6.29 per cent of the total electricity demand by 1996-97 and up to 8.21 per cent in 2011-12 by adopting energy efficiency and demand-side management (DSM) options.

Maximum benefits are estimated to come from agriculture, residential and commercial sectors.

However, India is not well endowed with conventional energy resources like oil, gas or uranium. Coal is abundant but regionally concentrated and of low calorie and high ash content.

Under the present circumstances, India rightly shifted its focus to harness renewable power generation and currently installed power generation capacity is higher with coal at 58.3 per cent, followed by hydro 17.7 per cent, renewable energy 12.3 per cent, gas 9.0 per cent, nuclear 2.1 per cent and oil 0.5 per cent.

Among the renewable energy sources, bio-energy or biomass based power generation was a huge area of exploration as there was a huge amount biomass potential in India. In India, current biomass potential, including rural and urban waste is about 34,961 MWe.

Moreover, among the biomass resources, the tree based Dendro power generation is quite superior as compared to other biomass resources because of its high grass colorific value (GCV) and high combustibility.

But this Dendro potential has not yet been fully exploited in India because of lack of its cost effectiveness and non-availability of quality raw material, lack of site specific tree cultivation models, un-organised supply chain and lack of cooperation among stake holders.

D.S.M:

There is little doubt that India’s electric power sector could gain from the implementation of energy efficiency and DSM programmes. Technical potential and cost effectiveness of various measures for improving end use efficiency are well established.

However, the actual efficiency gains remain far from being realised mostly due to a variety of technical, policy, institutional and information related barriers. Some of these barriers include high initial cost of energy efficient equipment’s, limited availability of energy-efficient technologies, risk aversion by consumers and lack of information and awareness among consumers.

On the policy front, the most important barrier is probably the present electricity pricing policy of the state electricity boards. The present pricing policy does not provide the consumers with the right signals and does not induce consumers to conserve electricity. A lack of utility commitment to DSM and to an integrated approach to power planning is also responsible for the slow progress in India’s energy efficiency.

Co-generation:

Several energy intensive industry categories such as sugar, paper, textiles and fertilizers generate their steam requirements internally and also purchase electricity from the grid. Co-generation of electricity and steam offers increased system and fuel efficiency to the industry. It also reduces industry demand for utility power and the additional surplus, if any, could be sold to utilities.

Co-generation, thus provides an alternative to utility power and reduces the overall emissions from the power sector. While co-generation systems are being increasingly used in paper, pulp and fertilizer industries in India, there is very little effort to optimize the steam and electricity requirements.

Factors responsible for such poor effort include company investment criteria, unavailability of equipment, concerns about incremental costs and finally the government regulations.

Thus it can be broadly stated that in order to have a balanced development of the power sector in India, a considerable change in the structure, pattern, power-mix, operation, regulation and decision making practices, currently governing the electric power development in the country, should be thoroughly planned and executed.

This requires a comprehensive effort on the part of the Government as well as from the public, in general. Moreover, in order to bridge the demand supply gap in electric power in the country, both the demand side management (DSM) options and supply side management (SSM) options should be activated to the maximum possible extent.