The Central Electricity Authority (CEA) has pegged the power capacity addition target for the 12th Plan (2012-17) at twice the 11th Plan target of 62,374 MW, Union Minister for Power Sushilkumar Shinde, recently announced in New Delhi.
Inaugurating India Electricity 2010, the 5th International Exhibition & Conference on Power Sector, he said, “The Planning Commission is yet to set up a working Group to finalize the 12th Plan target for the power sector. The CEA’s capacity addition target would be assessed by the planners to come up with a final view”.
Shinde said that in order to meet the growing needs of the economy, a capacity of 62,374 MW was being targeted during the current plan period, which is three times the total capacity added during the 10th Plan. Last year (2009-10), 9485 MW was added, the highest capacity addition in a single year during the last 60 years and “this year we are confident of adding more than 15000 MW, the Minister declared.
The task of capacity addition during the 12th Plan was “gigantic”, he said, adding that to achieve the target, adequate manufacturing and erection capabilities for main plant equipments and balance of plants for thermal projects need to be assured. Availability of adequate number of vendors/sub-contractors, trained manpower for erection and operation & maintenance of power plants was imperative. Further, there was a crying need to develop infrastructure facilities like roads, railways and ports to meet the requirements of power projects.
Commending the enthusiastic response of the private sector to the opening up of the power sector, the minister said that the investment in the private sector has grown rapidly and its share in total capacity was likely to go up from less than 10 per cent in the 10th Plan to about 32 per cent in the 11th Plan. During the 12th Plan, the private sector was expected to contribute significantly to generating new power capacity and its share was likely to touch 60 per cent.
The Minister said that several joint ventures like L&T-MHI, Bharat Forge-Alstom, Ansaldo-GB Power, Toshiba & JSW, Thermax with Babcock & Wilcox and BGR with Hitachi, have been formed in the private sector for manufacturing power plant equipment for use by new power projects, including the 12th Plan projects.
The distribution sector, Shinde said, was the most crucial link in the electricity supply chain, an area where the power sector is lagging behind. “Our aim is to bring down AT&C losses to 15 per cent from the current level of around 30 per cent”.
To give a thrust to rural electrification, the Government, he said, was implementing the Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY). A total of 87,000 villages have been electrified and the remaining 63,000 villages would be electrified by 2012.
Power Secretary P Uma Shankar listed out five major challenges in order to achieve the ambitious power sector targets in the 12th Plan and beyond. There are timely supply of main power plant equipment, especially the balance of plants equipment; expeditious grant of various clearances, particularly environment and forest approvals; effective management skills; commercial viability and financial soundness of distribution utilities.
In this context, he underlined the need to widen and deepen the vendor base for the supply of balance of plant equipment like coal handling plant, ash handling plant, water treatment plant. Special care would have to be taken to ensure that no EPC contractor or its sub-vendor is overloaded beyond through bunching of orders beyond its annual delivery capacity and capability, he added.
Expressing concern over the expected shortfall of 200-250 million tonnes in the availability of coal, the mainstay of power generation, in the terminal year of the 12th Plan, he said that this likely gap may result in stranded capacity.
Ascribing the slow pace of growth in coal production to the inordinate delay of 3-5 years in the grant of environmental and forest clearances, the Secretary said that if the country has to grow at 9 per cent annually, “we have to strike the right and judicious balance between the imperatives of development and environmental concerns and resolve such issues expeditiously”.
On the distribution front, he said that during the 12th Plan, it would be crucial to take time-bound steps for energy auditing and accounting, separation of rural and urban feeders, control of theft, improving power procurement and portfolio skills, rationalizing the pricing of power and privatising distribution in urban and industrial areas, particularly where AT&C losses were unexpectedly high, either through the grant of licence or appointment of input-based franchisees.
Dr Amit Mitra, Secretary General, FICCI, pointed out that while the policy and regulatory frameworks in the power sector were in place, the sector was plagued with critical issues such as fuel availability and transportation, equipment supply, reforms in the distribution sector and open access. He called upon the Government to ensure that clearances from other ministries were fast tracked and the development of infrastructure facilities like railways, roads and ports, accelerated.
Inaugurating India Electricity 2010, the 5th International Exhibition & Conference on Power Sector, he said, “The Planning Commission is yet to set up a working Group to finalize the 12th Plan target for the power sector. The CEA’s capacity addition target would be assessed by the planners to come up with a final view”.
Shinde said that in order to meet the growing needs of the economy, a capacity of 62,374 MW was being targeted during the current plan period, which is three times the total capacity added during the 10th Plan. Last year (2009-10), 9485 MW was added, the highest capacity addition in a single year during the last 60 years and “this year we are confident of adding more than 15000 MW, the Minister declared.
The task of capacity addition during the 12th Plan was “gigantic”, he said, adding that to achieve the target, adequate manufacturing and erection capabilities for main plant equipments and balance of plants for thermal projects need to be assured. Availability of adequate number of vendors/sub-contractors, trained manpower for erection and operation & maintenance of power plants was imperative. Further, there was a crying need to develop infrastructure facilities like roads, railways and ports to meet the requirements of power projects.
Commending the enthusiastic response of the private sector to the opening up of the power sector, the minister said that the investment in the private sector has grown rapidly and its share in total capacity was likely to go up from less than 10 per cent in the 10th Plan to about 32 per cent in the 11th Plan. During the 12th Plan, the private sector was expected to contribute significantly to generating new power capacity and its share was likely to touch 60 per cent.
The Minister said that several joint ventures like L&T-MHI, Bharat Forge-Alstom, Ansaldo-GB Power, Toshiba & JSW, Thermax with Babcock & Wilcox and BGR with Hitachi, have been formed in the private sector for manufacturing power plant equipment for use by new power projects, including the 12th Plan projects.
The distribution sector, Shinde said, was the most crucial link in the electricity supply chain, an area where the power sector is lagging behind. “Our aim is to bring down AT&C losses to 15 per cent from the current level of around 30 per cent”.
To give a thrust to rural electrification, the Government, he said, was implementing the Rajiv Gandhi Grameen Vidyutikaran Yojana (RGGVY). A total of 87,000 villages have been electrified and the remaining 63,000 villages would be electrified by 2012.
Power Secretary P Uma Shankar listed out five major challenges in order to achieve the ambitious power sector targets in the 12th Plan and beyond. There are timely supply of main power plant equipment, especially the balance of plants equipment; expeditious grant of various clearances, particularly environment and forest approvals; effective management skills; commercial viability and financial soundness of distribution utilities.
In this context, he underlined the need to widen and deepen the vendor base for the supply of balance of plant equipment like coal handling plant, ash handling plant, water treatment plant. Special care would have to be taken to ensure that no EPC contractor or its sub-vendor is overloaded beyond through bunching of orders beyond its annual delivery capacity and capability, he added.
Expressing concern over the expected shortfall of 200-250 million tonnes in the availability of coal, the mainstay of power generation, in the terminal year of the 12th Plan, he said that this likely gap may result in stranded capacity.
Ascribing the slow pace of growth in coal production to the inordinate delay of 3-5 years in the grant of environmental and forest clearances, the Secretary said that if the country has to grow at 9 per cent annually, “we have to strike the right and judicious balance between the imperatives of development and environmental concerns and resolve such issues expeditiously”.
On the distribution front, he said that during the 12th Plan, it would be crucial to take time-bound steps for energy auditing and accounting, separation of rural and urban feeders, control of theft, improving power procurement and portfolio skills, rationalizing the pricing of power and privatising distribution in urban and industrial areas, particularly where AT&C losses were unexpectedly high, either through the grant of licence or appointment of input-based franchisees.
Dr Amit Mitra, Secretary General, FICCI, pointed out that while the policy and regulatory frameworks in the power sector were in place, the sector was plagued with critical issues such as fuel availability and transportation, equipment supply, reforms in the distribution sector and open access. He called upon the Government to ensure that clearances from other ministries were fast tracked and the development of infrastructure facilities like railways, roads and ports, accelerated.
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