The Hindu Business Line : Will nuclear power really help?

The Prime Minister, Dr Manmohan Singh, wants to clinch the civilian nuclear deal with the United States in order to provide energy to meet the country’s growth requirements. This viewpoint is based on two beliefs. One, we need large amounts of power to sustain the 8 per cent-plus rate of economic growth. Two, it will not be possible to meet these requirements from other sources of power.

Both these beliefs do not stand on sound footing. The Central Electricity Authority established by Ministry of Power has estimated in the Seventeenth Electric Power Survey that we need to add 60,000 MW generating capacity during the Eleventh Plan. The Power Minister, Mr Sushil Shinde, has upped this to 80,000 MW. The hype is that we need this colossal amount of power to sustain economic growth. However, the record until now speaks otherwise.

The Economic Survey published by Ministry of Finance tells us that the average rate of economic growth was 5.9 per cent in 1997-02 and 6.9 per cent in 2002-06. We can extrapolate this trend to project a growth rate of 8.0 per cent, assuming that this acceleration in rate of growth will continue.

The consumption of electricity grew at 5.8 per cent in 1997-02 and 4.8 per cent in 2002-06. We may project a growth rate of 4 per cent if this deceleration in the rate of growth of electricity consumption continues.

In other words, we need to increase generation of electricity during the Eleventh Plan by only 4 per cent to sustain an economic growth rate of 8 per cent.

Our capacity for generation was 150,700 MW in 2006. Thus, we need to add only 32,650 MW capacity in the Eleventh Plan during 2007-12. The Central Electricity Authority is projecting a requirement of 60,000 MW without taking into consideration the declining requirement of electricity in sustaining economic growth.

Truly, we do not need even this amount of electricity. We must distinguish between requirement of electricity for economic growth and for consumption.

Electricity required for running tube-wells, factories, computers of IT providers and call-centres contributes to economic growth. On the other hand, electricity required for running washing machines and domestic air-conditioners mainly contributes to consumption.

Domestic sector

The division is not strict, however. The homemaker also is productive. There is a huge debate among economists about the need to add contribution of the domestic sector to GDP. However, the conventional sources of economic growth are agriculture, manufacturing and services.

The Economic Survey does not mention the domestic sector as a source of economic growth. This is acceptable because washing machines do not necessarily contribute to higher production in the domestic sector. Hence, if we restrict ourselves to this conventional approach, then the power requirement for the domestic sector should be excluded from the calculation of electricity required for economic growth.

The Seventeenth Power Survey tells us that about 30 per cent of the projected requirement of electricity is for the domestic sector. Thus, only 70 per cent of the projected requirement of 32,650 MW, or 23,000 MW, is required by the ‘productive’ sectors and should be considered to contribute to economic growth. The Prime Minister is repeating the refrain of “60,000 MW” when there is really no such need.

Nuclear source

The second belief underlying the huge need for power is that we necessarily need to develop nuclear power from imported uranium in order to meet our requirements of electricity. The Planning Commission has outlined possible sources of energy in 2031 in its Integrated Energy Policy report.

It is estimated that of a total 1,652 Mtoe (Million Tonnes of Oil Equivalent) requirement, in the normal scenario 1,022 Mtoe will come from coal, 76 Mtoe from nuclear and 13 Mtoe from hydro.

It is expected that forced development of nuclear power will raise the contribution of this source from 76 to 98 Mtoe. Similarly, forced development of hydro projects will raise their contribution from 13 to 35 Mtoe. In other words, forced development of these sectors will add a meagre 22 Mtoe each to our energy availability.

The role of other energy sources is much greater. Demand-side management, such as higher price of power during peak hours and use of CFL bulbs, will save 142 Mtoe of energy. Improvements in efficiency of power generation from coal will increase production by 120 Mtoe from the same amount of coal. Increased reliance on rail instead of road in freightage will save 81 Mtoe.

In other words, 343 Mtoe of energy can be saved from these efficiency-related measures. The contribution of forced development of nuclear and hydropower is dwarfed in comparison, as only 44 Mtoe will be added. Clearly, we will not make much progress in meeting our energy requirements by a focus on forced development of nuclear and hydro, as is being done at present.

We are unnecessarily diluting the sovereignty of the country and destroying our rivers and environment when other more effective measures are available to us to meet our energy needs.

The power bureaucracy is at work. Large contracts for power generation can only be given if generation is increased. Higher generation targets mean more projects and more benefits to the bureaucracy. There is less scope for large contracts in promotion of CFL bulbs.

Thus, the Central Electricity Authority and Minister of Power are making excessive forecasts of power requirements in their anxiety to promote large projects that provide unspecified benefits; and there is all too little talk of reducing demand for power by promoting efficiency of utilisation.

(The author, a freelance writer, can be reached at bharatj@sancharnet.in)