With the Union Power Ministry gearing up to scrap the firm allocation of power from the central generating stations (CGS) in non-competitive bidding mode, Kerala will have to immediately apprise the Centre of the consequences that are likely to arise on adopting a revised sharing methodology and also initiate steps to augment the generating capacity by 2,500 MW.
As per the revised guidelines proposed by the Centre, States hosting power projects reserve the first right for 85 per cent of the generated power, after apportioning 15 per cent with the Central unallocated pool for meeting exigencies.
Power sector sources told The Hindu here that the Central allocation during the past one decade had increased by 800 MW, but the State could add only 250 MW to its own power pool. None of the generating stations in South India would share power with Kerala from its unallocated 15 per cent.
The State government would have to wake up to this reality and chart a strong course of action to tackle local resistance to inception of new projects. It would also have to apprise the Centre that the Ministry of Environment and Forests had been denying clearance for major hydel projects identified in the late eighties, citing the need for conserving the rich flora and fauna and a host of other environmental issues.
The State does not have fossil fuel reserves such as coal or lignite and hence would have to drain its resources for purchasing power through competitive bidding from private generators. This would inevitable lead to a tariff hike and the consumers would have to bear the burden.
Proposed methodology
The proposed methodology is heavily balanced in favour of resource rich States and the State government would have to convince the Centre that it amounts to discrimination.
Considering the easiness in carting power, almost all generators prefer to establish plants in resource-rich States, especially where coal is available in plenty. This would further push Kerala to the brink of a crisis soon and also runs against the Constitutional obligation for balanced development across the country through equal sharing of available resources.
Whether the Centre would approve the arguments of the State government is a matter of concern, but it would take up the issues soon, sources said.
