With the Narendra Modi government laying stress on infrastructure development to ensure a two-digit growth for the country, the power sector could expect provisions in the Union Budget, which will be tabled on February 1, for attracting indigenous and foreign investment in the sector, electricity finance expert D. Shina has said.
In a statement on Sunday, Dr. Shina said the government could more or less achieve expected growth in the power sector in the current year. The national installed capacity has grown to 3,10,015 megawatts and energy target of 1,178 billion units is to be achieved soon, reducing energy shortage to a negligible 0.7%.
Dr. Shina said the current growth has to continue for a few more years if the requirements ignited by the projected economic growth are to be met. Progressive amendments to the Electricity Act, steps to enforce renewable energy purchase obligation, policies to encourage solar, wind, small hydro and other renewable energy sources, and new hydrocarbon policy have benefited the private sector in the electricity industry.
However, the enormous hydel potential of India remains untapped and a drastic policy reorientation was needed on this front, she said. The national hydel potential is estimated to be nearly 1,50,000 megawatts and only less than one third of it has been tapped so far. Tapping hydel power not only offers cheap energy during peak hours but also helps meet carbon credit obligations. Proactive steps in this direction, with sufficient funds to meet environmental reconstruction obligations, are expected in the Budget. Clean energy cess levied at the rate of ₹400 a tonne on production of coal has fetched a good amount to the exchequer.
The non-utilisation of available capacity of certain power plants like the Kayamkulam NTPC, due to its high energy cost can be resolved through proper remix in energy allocation or through budgetary support from the likes of the National Investment and Infrastructure Fund, Dr. Shina said.
