By Noor Mohd, IANS
New Delhi : Is the power ministry’s target of adding 78,577 MW of generation capacity during the 11th fiver-year plan (2007-12) realistic? The issue is being hotly discussed even as energy security becomes a key concern for the country.
R.V. Shahi, former secretary at the ministry of power and currently chairman of Energy Infratech, said the target for the current plan, though difficult, is achievable.
Kuljit Singh of consultancy firm Ernst and Young (E&Y) is, however, not so optimistic.
“Going by the historical performance of various states and the private sector in generation capacity addition, it is unlikely that all their projects will be commissioned on schedule,” said the E&Y consultant.
The magnitude of the task can be gauged from the fact that India was able to add just 56,618 MW generation capacity in the three previous five-year plans between 1992-93 and 2006-07.
The power ministry had envisaged generation capacity addition of 41,110 MW for the previous five-year, out of which only 19,015 MW could be implemented.
For the 11th plan, the ministry set a target of 67,000 MW but subsequently added another 11,000 MW of capacity addition, which was not achieved in the 10th five-year plan.
“The generation capacity envisaged for the 11th Plan period can be achieved if an out-of-the box approach is adopted,” Shahi told IANS.
“There is not much to worry, at least for now, about projects of about 50,000 MW capacity where implementation has begun. However, there are thermal projects with envisaged 25,000 MW capacity addition, where orders for equipment supply have not yet been placed by developers,” he said.
“This is where the power ministry’s intervention is required,” Shahi added.
“If developers of these projects can be persuaded to expedite and complete the process of placing orders for equipment supply by March, 2008, it will be a big boost to the capacity addition programme.”
Apart from this, the power ministry should also put in a mechanism to hold follow-up meetings to monitor the capacity expansion programme of Bharat Heavy Electricals Ltd (BHEL) expansion programme, said Shahi.
BHEL is spending Rs.32 billion to expand its manufacturing capacity to 15,000 MW a year by 2011-12 from the existing 6,000 MW a year.
BHEL has said that it should be able to have enhanced manufacturing capacity of 10,000 MW available by end 2007.
“However, supply of the balance-of-the-plant package equipment like ash handling, coal handling and cooling water systems, remains a critical area”, Shahi said.
“It is because BHEL does not have in-house manufacturing facility for these equipment and depends on outside vendors for their sourcing,” he explained.
BHEL will have to accordingly expand its vendor base if it is to meet its commitments to deliver equipment on schedule.
“BHEL also needs to increase the number of its commissioning personnel,” Shahi said.
Singh of E&Y is also sceptical of the sector’s performance in executing hydropower projects on time.
“Around 14,000 MW of hydro capacity is targeted in the current plan. But all these projects are unlikely to be commissioned,” he maintained.
“It is because most of the hydropower projects encounter geological ‘surprises’. There are also problems of rehabilitating people displaced due to their implementation. That leads to undue delay in completion of these projects,” he added.
Jawant Srinivas Kawale, joint secretary at the power ministry, said that hydropower projects in India face problems of geological “surprises” mainly because they follow uniform specification in plant design.
“These ‘surprises’ can be avoided to a large extent if developers design their plants keeping in mind local geological complexities,” Kawale said.
He admitted that land acquisition for hydropower projects remained a sensitive issue, often leading to delays.