Indian Power Sector

POWER FULL INDIA; REALLY? A proud moment indeed for India to achieve 100% electrification with electricity being made available to all its 6,49,867 villages. A village is termed Electrified if it get a minimum 16KVA transformer, 10% houses get power connection and electricity access given to School, Gram Panchayat office, Health Centre, Dalit Basti and Community Centre. It is a major achievement and has to be applauded as in last 15 years on an average 10,000 villages were electrified annually. It was a massive project, given challenges like remote and inaccessible villages. Now important task is to ensure availability of power in all villages if not 24x7 at least during night time to ensure safety & study of children during night. Per capita Electricity consumption will also grow from a very low 1000 Kwh. Planners shouldn’t worry too much about 100% households getting power. If power is continuously available balance 3.14 crore households will also demand power connection, not to be left behind in race of social equality.

SOLAR PANELS & BIS! After installing over 20 GW solar equipment, 10GW in 2017-18 alone, suddenly Ministry realises that supplies may be inferior products. As per Quality Control Order 2017 all manufacturers must register themselves with BIS before 1st July 2018. However, as this will take time wef 1st April 2018 till 30th June 2018 all Suppliers and Developers will have to give self-certification that their equipment is BSI compliant. What is the trigger? Are there complaints that Developers, who are all reputed big names of Industry, are short charging and buying inferior products or being cheated by suppliers (mostly from China) as quality control norms may not have been activated by Developers who are investing Billions of Dollar on Projects they shall be required to operate for next 20 years or so. Or is it a step in throttling imports to “Make in India” really happen? And do we have enough Labs to be able to register vendors after stringent testing of their equipment. This is surely going to slow down imports and targets for years to come.

FATE OF THERMAL POWER IN INDIA? With full attention being paid to Solar Power there is meteoric growth in the Sector. In 2017 a record funding of US$ 10 Billion has been received by Indian Solar Power developers. Installed Capacity in February 2018 is 20 GW, an eight fold increase in last three years. Average price of solar power is comparable with Thermal power, if not lower. This leaves Thermal Power Sector in a great dilemma. Installed manufacturing capacity of 20GW per annum set up at great cost is almost idle. We invited all big names to invest in setting up manufacturing plants in India at greAT cost. There's so much skilled manpower looking at gloomy future. True Green Energy is the need of day to meet climate warming challenges. But what will happen to huge installed Thermal Power Plants Capacity almost all operating at part load. With almost nil investments in this sector what will happen to aging plants? Who will supply backup power in the nights. Unlike developed countries India can't afford to setup huge battery banks for power backup. Won't it be prudent to not neglect Thermal Sector totally but strike a balance with Solar Energy which shall be 100 GW by 2022.

SUN IS REALLY SHINING ON SOLAR SECTOR! Year 2017 was landmark for Solar Energy. Total installed capacity shot up to 20 GW, an addition of over 9.5GW during the year, nearly 45% of installed capacity. Tariff also nosedived to Rs 2.44/Kwh matching Thermal power and tempting many a Discoms (Andhra, UP) to seek renegotiation of already agreed PPAs. It is an outright breach of sovereign guarantees but such are the ways of working. There are still more problems for Developers. Buckling under pressure from domestic solar panel manufacturers Import Duty has been hiked. It can result in delay of Projects already signed as developers have yet to bring the equipment from China. Tariff in new Project shall also go up correspondingly. These can have negative impact and slow down the growth in coming years. But the fact remains that importance of solar energy has been realised and it will be growth engine of power sector in coming years. There will be no looking back. A little slow down maybe.