The Hindu Business Line : ‘Govt keen on allowing pvt players in nuclear power’

New Delhi, Feb. 28 Even as the fate of the Indo-US civil nuclear deal hangs in the balance, the Government has favoured permitting private sector investments into nuclear power generation.

Allowing private corporate investments in the field of nuclear power has been listed out under the key policy reform measures in the Economic Survey. The survey has said that private investment in nuclear power should be subject to regulation by the Atomic Energy Regulatory Board and Atomic Energy Commission.

Tata Power, Larsen & Toubro, Reliance Energy, GMR, Essar Power and the Vedanta Group are among those in the fray for entering nuclear generation. Participation of private players in nuclear generation is, however, subject to the Government amending the Atomic Energy Act, under which currently participation in the sector is limited to Nuclear Power Corporation India Ltd and sister concern Bharathiya Nabhikiya Vidyut Nigam Ltd. It also stressed on the need to “fully exploiting the nuclear and hydro potential for power generation.”

Constant slippages

Expressing concern over the constant slippages in capacity addition targets and mounting subsidy burden, it has stressed on improving financial viability of power utilities, particularly in States, to overcome the crisis.

“Improving financial viability of power utilities is one of the key deliverables of power sector reforms,” the survey said, adding that the growth in this space has been “modest as compared to the robust performance in manufacturing and services.”

According to revised estimates, the gross subsidies for the power sector would grow to Rs 43,132.6 crore for 2007-08 against the provisional figures of Rs 40,054 crore for 2006-07, the survey said. The amount could rise to Rs 46,087 crore in 2008-09, it added.

Laying emphasis on the creation of the policy framework for enabling stakeholders to reap the benefits of open access, it said “SERCs should notify rational, credible, cross-subsidy for open access so that it can become a reality. Open access should include access to electricity pillars to string a wire.”

Terming the sector as a “laggard”, the document has noted that the country may add 10 per cent less power capacity than the targeted 12,039 MW during the current fiscal. “It is expected that the total capacity addition during the current financial year would be 10,821.8 MW,” it said.

Fuel shortages

Noting that fuel shortages remained a constraint for the sector, the survey said that during April-November, the generation loss due to gas supply shortages was 21.79 billion units. The power sector needed 65.69 million standard cubic metres of gas per day (mmscmd) but only received 36.31 mmscmd, it said. In 2006-07, the generation loss due to low gas supplies was 26.33 billion units.

“The supply of gas to power stations that use gas as the primary fuel remains inadequate ... leading to loss in generation,” it said.

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