India: Fuel Shortage Darkens Power Generation Scene

Business Standard

Mansi Taneja / New Delhi | Jul 05, 2012

An analysis of data for the 11th Plan ended March 2012 showed the installed generation capacity had increased 40 per cent but the actual generation rose 29 per cent. The installed capacity at the end of March this year was 199,877 Mw from 143,061 Mw at the end of March 2008. Availability was 857,239 million units at the end of March this year from 664,660 Mu at the end of March 2008

Despite an increase in generation capacity, the country has been grappling with power shortage in the peak summers as the availability has not risen at the same pace as generation capacity, owing to fuel unavailability and other supply constraints.

The increased generation, though, reduced the power deficit from 9.8 per cent in March 2008 to 8.5 per cent in March 2012. According to experts, the rise would have been more if there hadn’t been fuel supply constraints. “Fuel constraint has not only affected generation at units which have been commissioned but has also hit projects that were in line to be commissioned,” said R S Sharma, managing director, Jindal Power Ltd. He was earlier chairman and managing director of NTPC, the country’s biggest power generator.

Year Installed
8-Mar 143,061.0 664,660 -9.8
9-Mar 147,965.4 689,021 -11.0
10-Mar 159,398.5 746,493 -10.1
11-Mar 173,626.4 789,013 -8.5
12-Mar 199,877.0 857,239 -8.5
Source: Central Electricity Authority of India

Sharma said the country could have added another 10,000-15,000 Mw capacity in the 11th Plan but this did not happen primarily because of fuel problems and difficulty in environment clearances.

Says former power secretary Anil Razdan, “Because of the declining share of hydro and gas in the fuel mix for capacity, private companies took a risk and shifted to thermal/coal-based plants. Unfortunately, because of fuel problems there and increase in import prices of coal, things became different. We need to maintain a balance in the fuel mix.”

He also advocated higher rates for peak-hour supply. The industry, he added, can’t take care of all eventualities in extreme variations of climate.

The crux of the problem is insufficient production at Coal India, the near-monopoly producer. Demand for coal in India has grown at an annual rate of 8.4 per cent over the past five years. That of supply has risen at an annual 5.4 per cent during the period. For 2011-12, about 534 million tonnes was available, leaving a gap of 142 mt to be met through imports.

Of about 95 thermal power plants with a total capacity of 91,487 Mw, data from the Central Electricity Authority around mid-June showed stocks at a critical level at about 30, with a capacity of 21,000 Mw.


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