Power: Problem & Reforms

We are not facing a shortage of energy. We are facing a technical challenge in capturing it and delivering it to consumers. With reference to India’s power problems, critically comment on the statement. (200 Words)

India has the third largest reserves of coal, significant thorium reserves, capacity for solar power, numerous rivers with hydropower feasibility, tidal energy, geo thermal, wind and newly found abundant coal bed methane and shale reserves. Still large proportion of population without electricity access. The reason for this paradox are mostly technical such as :
  1. Coal – Poor coal quality of Indian reserves and inadequate coal washing, coal gasification technology.
  2. Solar – Lack of storage batteries technology, insufficient micro grid and low capacity of our national grid does not allow extensive usage of solar power.
  3. Nuclear – Third stage nuclear generation uses thorium reserves. We still haven’t reached there. Moreover, no progress on Fourth generation nuclear reactors.
  4. CBM and shale require state of the art fracking technology which is unavailable.
  5. Other renewable energy require technology upgradation to make them affordable and comparable to other resources.
These technological challenges have not allowed us to adequately capture our resources. Moreover, coupled with AT&C loses, inability to stop thefts and inadequate distribution network has made electricity expensive. Nevertheless, the government through the Deendayal gram jyoti yojana, IPDS( Integrated Power Development Scheme), National solar mission and recent coal auction seeks to resolve these issues.
It is said that power sector reforms being undertaken in India are not rightly focused on systemic problems haunting this sector. Critically examine and suggest what should be the right approach of government towards reforming power sector. (200 Words)
Power sector in India is need of some urgent reform. Though some effort has been done in this regard, but most of these efforts remain misplaced and ill directed. Reforms in power sector have been thought to be increase in generation capacity. That is indeed important, but there are reforms in the area of transmission and distribution that needs attention:
  1. State electricity boards need to be professionalized so that they function efficiently.
  2. Technology up gradation and up scaling of distribution infrastructure is the need of the hour
  3. Political doles such as “free electricity” need to be avoided so that state electricity boards do not run into chronic losses.
  4. Private players must be involved in the distribution business and a robust regulatory mechanism must also be evolved for Dis-Coms.
  5. Special task force for prevention of power theft, which is another reasons for losses in electricity boards
There are other systemic reforms needed:
  1. Focus of huge untapped renewable energy resources.
  2. Shortage of coal must be checked through transparent processes for allocation of mines and single window clearance for initiating work on them.
The demand for electricity in India is ever rising. Various state governments and the central government have started identifying the systemic issues in the power sector. With targeting each such issue holistically, there is hope that the power sector would become a shining sector in India.
Examine the challenges faced by state governments in production, transmission and distribution of power. Also examine recent measures taken by states to bring power reforms. (200 Words)
Problems of Power Sector
  1. Despite huge capacity addition, generation is unviable many a times due to high cost of imported fuel.
  2. Despite having one of the largest coal reserves, India lags behind in coal production. Recently the coal blocks were e-auctioned opened to private players after the SC de-allocated the coal blocks. This is a progressive step to enhance fuel capacity and bring down production costs.
  3. Untapped potential of North East despite its potential due to low infrastructure and development of north east.
  4. Environmental clearances and SC decisions have also hindered in fast clearing of generation units e.g. SC ruling on study of Hydro power sources in Uttarakhand.
Transmission & distribution
  1. Low cost recovery – due to the populist measures of government , power subsidies for agriculture , high AT & C (Aggregate Technical & Commercial) losses due to power thefts.
  2. Low efficiency of the transmission equipment due to outdated technology and extended life
  3. Lack of adequate grid connectivity to all areas thus creating islands of power surplus and power deficit. Thus some areas having excess power can’t enter into power sale to power deficit regions. e.g. excessive power crunch in NE and South India whereas unutilized capacity in eastern zone.
  4. Cross subsidization of commercial power has led to inflated price on one side and misuse of free power by certain farmers.
Need of the hour
  1. Rationalization of subsidies
  2. Control power thefts so that price recovery is improved
  3. Modernization of equipment & transmission lines to enhance grid connectivity to NE also.
  4. Balancing environment with power generation.
  5. Enhancing the capacity of CIL by technological intervention and railway wagon increase.
  6. Feeder separation e.g. Gram Jyoti in Gujarat; Deen Dayal Upadhyay Gram Jyoti Yojana
  7. Promotion of New & Renewable energy sources through compulsory RPO scheme to incentivize green energy units.
Steps taken by states:
  1. J & K: A separate budget for power with significant increase in allocation. Increase in allocation to harness its huge hydro power potential to provide 24*7 power
  2. UP: Promise to provide 22 hours electricity in rural areas and 24 power in urban area by 2016, Double the electricity supply
  3. Odisha: Strengthening the power infrastructure, Increase in allocation to conserve energy and boost energy efficiency.



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