The Hindu Business Line : Planning for Power — Where rhetoric and reality part ways

Setting such ambitious targets as ending power shortages by 2012 is easy. The difficult part is achieving it. And here India's record has been abysmal with the unmet target of each Plan only ballooning. With the ambitious Ultra Mega Power Projects not exactly off to an inspiring start, and by the Power Ministry's own admission these cannot come up before the start of the Twelfth Plan, it is a moot point if the electrifying targets will be met, says ASHOAK UPADHYAY.

WILL TARGETS be met?

A day-long conference of Chief Ministers convened by the Prime Minster in New Delhi recently resolved to end power shortages in this country by 2012. With that noble objective in mind, the Chief Ministers under the guidance of Dr Manmohan Singh, planned an elaborate administrative machinery to tackle theft, transmission and distribution losses and help create additional power capacity. As is his wont, the Prime Minister articulated the problems with his usual sense of urgency, setting a time-table for those endemic shortages that almost every part of the country, regardless of which side of modernity it occupies, suffers from.

The Chief Ministers would have returned to their respective capitals with a lot of work to do. They have to launch campaigns to reduce power thefts, set up special courts to dispose of such cases — hopefully within the lifetime of those charged.

At the national level they must help in the formation of three crucial agencies to steer new power projects to fruition — a Standing Group of Power Ministers to examine everything that concerns power, a sub-group of this body that will scrutinise financial aspects of all new or additional power projects, and a National Power Project Management Board attached to the Ministry of Power that will, presumably, do as told and take all the flak for being unable to do anything.

Better late than never?

These days, the Prime Minster appears a man in a hurry. After three years of incidental rule over the fastest growth in history, his Government, or sections of it, is waking up to the fact that it was also the most skewed growth ever with lapses in critical sectors that are now beginning to hurt the growth process itself.

Closing the meeting of the National Development Council, the Prime Minister echoed the Planning Commission Deputy Chairman, Dr Montek Singh Ahluwalia's view that agriculture needs four per cent growth presumably to ensure that no more farmers are tempted to try for the afterlife, that the number of uneducated unemployed and unemployable does not multiply and, most pertinently, existing growth does not exhaust itself.

The Prime Minister reminded the Chief Ministers of the need for "tough decisions" to enable Rural India reach that target. It does not say much for the NDC to be reminded of that novel idea unless the Chief Ministers were hearing it for the first time; one would have thought that reforms of any kind demand "tough decisions."

Like the moribund farm sector, power shortages will bring the growth machines to a halt; the next quarter should witness some slippages in the rate of growth, though not necessarily on this account alone.

Increasingly, the prospect of the glittering lights dimming unless more power is available will become a dreadful one for more than just those that never had it anyway. But pious rhetoric will not fill shortfalls in power; tough decisions will.

Like investments in the farm sector, those in power too are a more complex matter than investments in, say, retail or telecom. That shortages have now risen to 13 per cent at peak usage time from 11 per cent some years ago is a reflection of the confusions in policy for additional power capacity creation especially after 1991 when the field was supposedly thrown open to the private sector.

The Delhi meeting reflected none of that complexity in the solutions the Chief Ministers hammered out for themselves though it figured in the Prime Minister's speech.

Lacking cohesion

Barring the wildly optimistic and party loyalists, most observers will view the Chief Ministers meet in New Delhi with weary scepticism. Simply reiterating the fact of power thefts or that a "business as usual" approach will not do, does not take the nation an inch closer to filling the gaps.

The theft of power and its impact on the general availability has been well documented because that problem has been with us as long as the vote.

Officials in almost every State turn a blind eye to such pilferage not because there is no machinery, such as the TADA courts, to dispose of such offences, but because politicians in power eager to maintain vote banks, allow the thefts to happen. Most governments have shied away from distributing the burden of a problem's spillover effects.

Just the other day, the Power Minister, Mr Sushil Kumar Shinde, unveiled power codes for commercial buildings as part of a conservation drive.

Welcome as this was, it would have even better, had the codes applied equally to government offices and buildings.

Conservation of precious energy is a social endeavour best served by example and what better place to start than within the government itself?

Dreaming power

Like its predecessors, this Government too looks for escape routes from complex problems. The idea of a Standing Group of Power Ministers sounds majestic but will work as effectively as any other committee ready with expert advice that no one seeks. The problems are on the ground. The Government's much touted plans for Ultra Mega Power Projects — nine of them each with 4,000 MW capacity that were to become operational during the Eleventh Plan to help tide over the shortfall in power and slip-ups in Tenth Plan targets — may not see the light of day in the next five years given the kind of delays that plague them. A Parliamentary Committee on Energy, in its report of April, severely indicted the Power Ministry, and thereby the Government, for slipshod planning.

Gathering extensive evidence from the Ministry itself, the Standing Committee on Energy found it "abysmally disheartening" that the Tenth Plan targets were not fulfilled often because of delays in the award of work orders and constraints in equipment supplies.

The picture does not appear any different now because the Power Ministry admitted to the committee that none of the ultra mega power schemes would come up before the Twelfth Plan starts. That is in 2012, the year the Prime Minister and the Chief Ministers have set for the elimination of power shortages. The Parliamentary Committee, examining demands for grants for the current year, found lack of realism in the Eleventh Plan target setting. It "fails to understand" how 68,869 MW capacity was feasible in the current Plan when the Tenth Plan target of 41,110 MW was in deficit.

Not surprisingly, it noted an increasing mismatch between budgetary allocations, which that have increased every year since 2004-05, and utilisations that have declined, to just 57 per cent last fiscal. The reasons for this are almost the same every year — confusions over the bidding procedures, shortfalls in equipment supplies and delays in the selection process; the hurdles to fund usages appear endless.

Coming to terms

Dr Manmohan Singh is surely aware that he straddles two sets of dichotomies as Prime Minster: The world of economic strategy that must account for extra-economic rationalities — political expediencies — for problem-solving and a world of politics that ought to factor in economic rationality for optimal benefit. The first dichotomy is a compulsion thrust upon him by his office, the second a necessity he must thrust upon his colleagues for the good of the nation.

As Prime Minister and professional economist, he cannot be unaware that subsidies however perverse (and power thefts are a form of subsidy), have to be reconciled with the market needs of rational user-charges for power utilities. Till that apparent dilemma is resolved the country may just lurch from one power shortage to another.