India’s power sector

Power Sector plays vital role in the economic growth and Human development of any country. It definitely improves the quality of life of human beings and the biotic of this sphere. Electricity consumption is one of the most important indices for measuring the development level of a nation.

Power is one of the most critical components of infrastructure and crucial for the welfare of the Nations. India’s power sector is one of the most diversified in the world.

Electricity demand in the country has increased rapidly and is expected to rise further in the years to come. In order to meet the increasing demand for electricity in the country, massive addition to the installed generating capacity is required for efficient and effective Production of Goods and Services.

India is world’s sixth largest energy consumer, accounting for 3.4 per cent of global energy consumption, with Maharashtra as the leading electricity generator among Indian states. Due to India’s economic rise, the demand for energy has grown at an average of 3.6 per cent, per annum over the past 30 years.

India is also the sixth largest in terms of power generation. About 65 per cent of the electricity consumed in India is generated by thermal power plants, 22 per cent by hydroelectric power plants, 3 per cent by nuclear power plants and rest by 10 per cent from other alternate sources like solar, wind, biomass etc.

53.7 per cent of India’s commercial energy demand is met through the country’s vast coal reserves. The country has also invested heavily in recent years on renewable sources of energy such as wind & Solar energy.

Additionally, India has committed massive amount of funds for the construction of various nuclear reactors which would generate at least 30,000 MW.

In July 2009, India unveiled a $19 billion plan to produce 20,000 MW of solar power by 2020 under National Solar Mission.

The per capita power consumption in India is 733.54KWh/yr, which is very minimal as compared to global average of 2340KWh/yr. Power cuts are common throughout India and this has adversely effected the country’s economic growth.

Power for all
The Government of India has an ambitious mission of POWER FOR ALL. This mission would require that the installed generation capacity should be at least 300,000 MW.

The Government of India is committed to improving the quality of life of its citizens through higher electricity consumption. The aim of Government of India is to provide each household access to electricity, round the clock (24x7). The ‘Power for All’ programme is a major step in this direction.

Joint initiative of Government of India and Government of States/Union Territories aims to further enhance the satisfaction levels of the consumers and improve the quality of life of people through 24x7 power supply. This would lead to rapid economic development of the country in all sectors resulting in inclusive development and Inclusive growth.

The Government of India immediate goal is to generate two trillion units (kilowatt hours) of energy by 2019. This means doubling the current production capacity to provide 24x7 electricity for residential, industrial, commercial and agriculture use.

So the Government of India and The State Governments should prioritise on perspective planning, policy formulation, processing of projects for investment decision, monitoring of the implementation of power projects, training and manpower development and the administration and enactment of legislation in regard to thermal, hydro power generation, transmission and distribution.

The government should focus
The Government should focus on the following aims and Objective for People of India

• Access to Electricity -
• Available for all households.
• Availability of Power - Demand should be fully met by 2017.
• Supply of Reliable and Quality Power.
• Per capita availability of electricity to be increased to over 1200 units by 2017
• Protection of consumers’ interests and Priority.

Objectives

• Sufficient power to achieve GDP growth rate of 8 to 10%
• Reliable power
• Quality power
• Optimum power cost
• Commercial viability of power industry
• Power for all
• Rural electrification

Strategies

• Power Generation Strategy with focus on low cost generation, optimization of capacity utilization, controlling the input cost, optimisation of fuel mix, Technology upgradation and utilization of Non Conventional energy sources
• Transmission Strategy with focus on development of National Grid including Interstate connections, Technology upgradation & optimization of transmission cost.
• Distribution strategy to achieve Distribution Reforms with focus on System upgradation, loss reduction, theft control, consumer service orientation, quality power supply commercialization, Decentralized distributed generation and supply for rural areas.
• Regulation Strategy aimed at protecting Consumer interests and making the sector commercially viable.
• Financing Strategy to generate resources for required growth of the power sector.
• Conservation Strategy to optimise the utilization of electricity with focus on Demand Side management, Load management and Technology upgradation to provide energy efficient equipment / gadgets.
• Communication Strategy for political consensus with media support to enhance the general public awareness.

12th Plan period targets
The Planning Commissions of 12th Plan projects that total domestic energy production would reach 669.6 million tonnes of oil equivalent (MTOE) by 2016–17 and 844 MTOE by 2021–22. For the 12th Five-Year Plan, a total of 88.5 GW (giga watt) of power capacity addition is targeted; of which, 72.3 GW constitutes thermal power, 10.8GW hydro power and 5.3 GW nuclear power.

Electricity is a concurrent subject at Entry 38 in List III of the seventh Schedule of the Constitution of India. The Ministry of Power is primarily responsible for the development of electrical energy in the country.
The power sector in India is mainly governed by the Ministry of Power. There are three major pillars of power sector these are Generation, Transmission, and Distribution.

As far as generation is concerned it is mainly divided into three sectors these are Central Sector, State Sector, and Private Sector.

The Ministry of Power is the apex body responsible for the development of electrical energy in India. This ministry started functioning independently from 2 July 1992; earlier, it was known as the Ministry of Energy.

No doubt, really the Power Generation in India has grown rapidly over the years. Electricity production in India stood at 1,048.7 Terawatt h (1012) in financial year 2015, it is an 8.4 per cent growth over the previous fiscal year 2014.

Over Financial year 2010–2015, electricity production expanded at a Compound Annual Growth Rate (CAGR) of 6.3 per cent.

According to Ministry of Power Government of India, the Indian power sector has an investment potential of Rs 15 trillion (US$ 237 billion) in the next 4–5 years, thereby providing immense opportunities in power generation, distribution, transmission, and equipment.

• India’s index of industrial production (iip)/ electricity
• Electricity generation (weight: 10.32%) increased by 0.1 % in August, 2016 over August, 2015. Its cumulative index during April to August, 2016-17 increased by 5.7 % over the corresponding period of previous year.

Indian power sector- international cooperation
Indian power Sector is also concentrating on International Cooperation with various countries for power sector cooperation and development.

Active interest have been taken in enhancement of bilateral cooperation with Bangladesh, Bhutan, Nepal, Sri Lanka, China, Germany Japan, Russia, united kingdom, United States of America, European Union etc., Multilateral engagements under the umbrellas of SAARC Nations and other Nations.

For Example a Joint Indo-US PACE (Promoting Energy Access through Clean Energy) Setter Fund has been established, with a contribution of US$ 4 million from each side to enhance clean energy cooperation.

Sources of power generation in india
(i) Conventional sources

• Coal
• Lignite
• Natural gas
• Oil
• Hydro
• Nuclear power to viable (ii) non-conventional sources
• Wind
• Solar
• Agricultural
• Domestic waste.

Renewable energy targets
The Government of India announced a massive renewable power production target of 175,000 MW by 2022. This comprises generation of 100,000 MW from solar power, 60,000 MW from wind energy, 10,000 MW from biomass, and 5,000 MW from small hydro power projects. Recently The Union Cabinet of India approved 15,000 MW of grid-connected solar power projects of National Thermal Power Corp Ltd (NTPC).

Priority sector lending
Reserve Bank of India (RBI) has notified including renewable energy under priority sector lending (PSL). Therefore, banks can provide loans up to a limit of US$ 2.36 million to borrowers for renewable energy projects.

The Andhra Pradesh Government plans to establish an ‘Energy University’, which would focus on research orientation and development of energy efficiency, energy conservation, and renewable sources. The funding for the 'Energy University' will be borne by AP government and power utilities, public sector undertakings such as NTPC, PGCIL, PFC, REC etc,

The Below Bar Charts showing the Indian Power Sector Status

Power Sector at a Glance in India
As on 23-10-2015
Total Installed Capacity
As on 30.09.2015

Fuel	MW	%age
Total Thermal	1,94,200	69.7
Coal	1,69,118	60.7
Gas	24,088	8.6
Oil	994	0.4
Hydro (Renewable)	42,283	15.2
Nuclear	5,780	2.1
RES** (NRE)	36,471	13.1

Total: 2,78,734

Power sector at a glance as per sector wise

Sector	MW	%age
State Sector	96,455	34.6
Central Sector	74,171	26.6
Private Sector	1,08,108	38.8

Total: 2,78,734

By: T Anand
Writer is Director, Sadhguru IAS Academy