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An Area Of Darkness

It's a bleak scenario. Countrywide. And if the Government doesn't put its power house in order, and that too real quick, we will have to get used to electricity being a luxury.

An Area Of Darkness
outlookindia.com
-0001-11-30T00:00:00+0553

IT was the bleakest New Year's day for the capital and surrounding towns in recent decades. In the early hours of January 1, barring the so-called VIP areas, the whole of Delhi was plunged into sudden darkness, as the National Thermal Power Corporation's 840-MW Dadri power station in Uttar Pradesh, which reserves 90 per cent of its supply for the capital, tripped around 3 am.

Long spells of power breakdowns persisted, adding up to 10-12 hours a day. At the time of going to press there were no signs of the capital's requirement of 1,900 MW being fully met. A shortfall of up to 350 MW continues. And this is the—incredible—sixth time in five weeks that the Northern grid developed glitches. Union Power Ministry officials attributed the frequent grid failures to poor maintenance of equipment. Late last week, Chief Minister Sahib Singh Verma was talking about imposing power cuts even in the VIP areas, unprecedented in Indian history.

Far away in Bhagalpur, Anwar-ul-Haq would have surely smiled cynically if he came to know of the plight of posh Delhiites. According to experts, this Bihar town has the worst power situation in the country, and Haq is one of the thousands of powerloom weavers who have been reduced to penury because there's no power to run his loom, and he doesn't have the money to buy a generator. In Jorhat in Assam, too, the reaction would have been the same: power for more than four hours a day is a luxury here.

C. Shivarudramurthy, a farmer with six acres of land, 35 km outside Bangalore, would not have felt much sympathy either. For years now, large patches of his farmland have been lying barren since the Karnataka State Electricity Board simply cannot supply the power that his irrigation pumpsets need. Even when it does, it mostly supplies inefficient two-phase power, not the promised three-phase.

With the power situation such in winter, what's in store for India this summer, barely three months away, when demand increases? For, across the country, we seem to be headed down a one-way street to hell as far as power is concerned. In Haryana, a desperate state government has snapped power supply to all industrial units consuming one megawatt or more for 10 days beginning January 7. Not that it makes much difference. Take a look at the power availability per day for the Whirlpool refrigerator factory at Faridabad from December 23 till January 6: nine hours, four hours, 11 hours, nine hours and 50 minutes, zero, 16 hours, nine, nine, 45 minutes, five hours and 25 minutes, zero, zero, 14 hours and 40 minutes, zero. Says Asim Kumar Talukdar, director-human resources: "Without regular power supply, we face problems of productivity, competitive disadvantage and sagging employee morale. We've so far had excellent industrial relations, but God forbid if we have to resort to statutory measures like layoff if the power situation deteriorates." In Maharashtra, the most industrialised state in the country, there is a power shortfall of 10 per cent, even after drawing electricity from the Western region electricity board grid. Last June,the Maharashtra State Electricity Board (MSEB) radically hiked tariffs for all consumers to make Maharashtra power rates possibly the highest in the world. Chief minister Manohar Joshi says the hike was necessary since MSEB had been asked by the World Bank to ensure a rate of return of 4.5 per cent on assets. But after the hike, around 90 induction furnace plants in the state have already closed down, unable to afford the higher rates and too small to set up captive generating plants. Dozens of rerolling mills and smelting units are facing closure. Thousands of small-scale units in the state are now threatening to go on strike.

In neighbouring Gujarat, the country's second most industrialised state, an acute power crisis looms large with the gap between peak hour demand and supply touching 1,800 MW. The shortages have been triggered by the short supply in natural gas to power stations. The gas-based Kawas plant in Surat district and the Jhanor-Gandhar station in Bharuch are operating at just 40 per cent of their installed capacity.

In Andhra Pradesh, with the lion's share of government funds—already depleted by the liquor ban—going into schemes like sub-sidised rice, the state, once power-surplus, is sliding into darkness.

Beginning January 14, the domestic sector will go without power for four hours a day. In Nagaland, Manipur and Tripura, most towns and villages except the capitals go without power for days on end. The problem is compounded by sabotage by militants. On January 6, 700 metres of high tension wire on a crucial line connecting the capital with the Eastern grid was stolen, resulting in no power for three days in Guwahati. In upper Assam, the oil installations and the state's 800-odd tea gardens depend largely on diesel generators in the absence of regular power supply. Says a senior manager of a tea estate: "If we depend on the electricity board for power supply, we will not be able to produce even half of our present tea output." The most terrifying aspect of the power collapse is perhaps the situation in our medical sector. Dr Prabodh Bansal runs the Bansal Surgical Hospital in Ghaziabad, Uttar Pradesh.

He routinely performs gall bladder, kidney stone and prostrate operations lasting for three hours with gensets. But post-operative care is a problem as patients find it difficult to recuperate because of the noise the generators make. The noise, says his wife, Dr Arti Bansal, also makes it difficult to accurately diagnose cardiac and respiratory ailments. "How can you listen to your stethoscope, with the noise of the generator? Placing generators in a soundproof room may involve additional expenditure, which all clinics cannot afford." In Hyderabad, Dr C. Dayakar Reddy, chairman of the CDR group of hospitals, admits that they have had to turn down less priority cases because of the power cuts, concentrating only on emergency patients. Bowring and Lady Curzon Hospital, Bangalore's second largest, has a generator which is, however, enough for just the vital departments like the operation theatres. "We have a second generator for the labour ward," says Dr L. Chandramma, superintendent of the hospital, "but we haven't been able to install it due to some problems with the PWD. While the hospital opens at 9 am, in effect we start work only at 10, when the power comes back."

WHY INDIA IS SHORT OF POWER

PEAK DEMAND . . . . . . . . . . . . . . . . . . . . . . . . . . .68,541 MW

GENERATING CAPACITY . . . . . . . . . . . . . . . . . . . .81,164 MW

PLANT LOAD FACTOR (EFFICIENCY) . . . . . . . .  .. .60% ONLY

TRANSMISSION & DISTRIBUTION LOSSES . . . . . . .20%

RESULT: PEAK SHORTAGE . . . . . . . . . . . . . . . . . ..29%

THIS in a country where demand is actually 84 per cent of installed generation capacity. So, all logic says that there should be no power problems at all.

Ah, well. This is after all also a country which does not have a National Power Policy, even though the development of one was strongly urged in the Electricity (Supply) Act, 1948, the law that governs the power sector. In 1976, there was some commotion in Parliament about this, and again in 1982. This is 1997, and still there is no sign of a policy.

This is a country where we manage to produce only 60 per cent of our power generating capacity, and then succeed in losing 20 per cent of the produced power during transmission and distribution (T&D). Any T&D losses above 8 or 9 per cent are supposed to be alarming (see box, The Thieves Among Us). Where, if we just managed to reach coal by rail in time to the power stations, our efficiency of generation could rise by a significant 7 to 8 per cent. Where, if the Government spent a one-time sum of Rs 1,850 crore on renovation and modernisation of power plants, it would add 5,000 MW to capacity, but prefers to stand guarantee for payments worth Rs 60,000 crore per year for the setting up of new power plants that will produce a bit more than that. Forget renovation and modernisation, India has no electricity metering system—the basic requirement for supplying power—worth talking about.

We spend around 160 paise to generate a KWh of power, and we get around 133 paise in return. "Over five years ago, the Power Ministers' conference had decided on a minimum tariff of 50 paise per unit for agricultural consumers—a ridiculously irrational and arbitrary figure to start with—but even this target remains elusive, with most of the states continuing to provide heavily subsidised electricity to agricultural consumers, even as the losses of the SEBs keep mounting precipitously," says Dr R.K. Pachauri, director, Tata Energy Research Institute (TERI). "The last straw on the camel's back is the recent announcement by the new chief minister of Punjab, Rajinder Kaur Bhattal, reportedly exempting 75 per cent of the agricultural consumers in the state from paying anything for the electricity they consume."

BUT the most ironic part of the whole agricultural power subsidy business is that though these subsidies have effectively made sure that our SEBs can hardly ever break even, not too many farmers are actually benefiting from the slashed or free power rates that are offered to them. Consider Maharashtra. Agricultural consumers growing less water (and therefore energy) intensive crops like wheat and jowar pay 70 to 100 paise per unit, while sugarcane farmers, possibly the most politically powerful—and well-off—agriculturists of the state, run pumps for 3,000 to 5,000 hours a year and pay as low as 10 to 15 paise per unit. These high energy-consuming farmers, who form 2 per cent of the total farmer population, have cornered 20 per cent of the total irrigation pump subsidy. And since power is almost free, no one bothers to adopt any energy-saving measures, which could actually bring down power consumption in this sector by at least 30 per cent.

It can now be said with some finality that the privatisation-based power sector reforms that were begun five years ago have been a total failure. At least, as of date. More importantly, the thrust of that power policy may have been entirely wrong.

That entire policy was based on a key assumption by the Government. Which was: given that agricultural subsidies are a holy cow, and that we have completely failed at any sort of demand-side management, if we get enough new people in and boost the supply side, the rest of the process will sort of—you know—just solve its problems and fall into place. By the grace of God. But God having more important things on Her mind, and our power managers having worked overtime to negate anything that She might have tried, we have a horrendous situation on hand. "It is essential for the public to understand that a huge industry, that relies all over the world on modern management and technological advancement for the good of the people for whom it is designed, cannot be managed any longer by a 19th century colonial structure of decision making," says Pachauri.

After five years, we have only two new private power projects which have started producing power, both in Andhra Pradesh. The vast majority of the proposed projects are unlikely to see the light of day. The simple reason being that if the SEBs don't become efficient, they are unlikely to be able to pay the private suppliers for the power they generate. Hence private suppliers want guarantees from state governments. State governments want their guarantees to be backed up by counter-guarantees from the Union Government. The Union Government can hardly go around guaranteeing every power project being set up in the country, since these would appear as contingent liabilities on its balance sheet, severely eroding its ability to borrow funds to do things that it needs to do. And we're not even talking about the possibility that all the guarantees are called in and the Government actually has to pay. That would be Armageddon. Besides, all this also begs a question. If the Government can give guarantees to private promoters, why then cannot it do the same for our own NTPC when it sets up plants? NTPC is a fairly efficient organisation, and is constantly at the receiving end of SEB inefficiencies, which eat into its potential profits every day of the year. This was in fact suggested in the early days of the Rao government, but the then power minister N.K.P. Salve said that this would be considered as and when the need arose. That's bureaucratese for "never".

But the real point may be that the thrust of that—and current—policy may be totally wrong. For as the installed capacity statistics show, the key solution may not be to willy-nilly add generation capacity. There are areas which require far less money and which could solve the problem faster. You have to spend far less to renovate plants than to set up new ones and get the same capacity addition. This has never been considered by our governments. When power pilferage is so rampant and visible to anyone who's not absolutely visually challenged, why doesn't any government take any measures to stop that? This will immediately add at least 10 per cent to our power availability. Why can't governments enforce end-user efficiency? According to a World Bank study, if more efficient usage is encouraged and followed up with determination, capacity reduction of as much as 22,000 MW is achievable at the end of a 10-year period. That's as much as one-third of our current peak demand!

While our power policy makers and implementers have sat on their hands, demand has been rising steadily. A reason for the collapse of the Northern grid has been the enormous rise in the number of room heaters in north India over the last couple of years. These and other gadgets which the middle class has lapped up have ended up making winter demand not too much lower than summer demand. And it's still rising. Of course, the rich in this country can always get their problems solved. 

In this case, it's huge generator sets fouling up the air we breathe. Says Delhi-based photographer Dayanita Singh: "In my otherwise cosy flat, I am surrounded by several kingsize generators which spew noxious fumes and rattle my window panes and brains with an incessant grinding sound. Today I suffer from a dull headache and nausea. With generators on for several hours at a stretch these days, I feel like I am riding on a scooter behind a smoke- belching Delhi Transport Corporation bus. I may soon be knocked out. I feel unsafe in my own house—the one place that I ought to be the most secure." "We have learned no lessons whatsoever on how to manage such a critically important sector like electricity," says Pachauri. But if things don't change, fast, as Al Jolson said in a rather different context: You ain't seen nothin' yet. 

 

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