ANDHRA PRADESH

Small, medium units in State suffer for want of power

Forced leisure:Workers idling away at a cotton pressing unit at Pulladigunta in Guntur district, owing to prolonged power cuts.— Photo: T. Vijaya Kumar

Forced leisure:Workers idling away at a cotton pressing unit at Pulladigunta in Guntur district, owing to prolonged power cuts.— Photo: T. Vijaya Kumar  

Industries opt for ‘Open Access’, a system enabling buyers to purchase power from outside

The power crisis in the State, for the industrial sector in particular, is set to continue for the days to come.

Even as the industry is expressing serious concerns over the acute shortage of power, the energy utilities have decided to permit the industry to purchase power from other States and private generation units to meet their requirements. With the AP Electricity Regulatory Commission forecasting an average 40 million units daily deficit till May, the Transmission Corporation is left with no option, but to allow the industry to opt for ‘Open Access’, a system enabling buyers to purchase power from outside, and transfer it using the utility’s transmission network.

Threat of lay-offs

This comes as a breather to the industry, the small and medium enterprises in particular, facing the threat of extended lay-offs. The SMEs which were hit by a 15-day power holiday for a couple of months since August are finding it difficult to secure orders from major industries owing to the acute power shortages.

Units engaged in the manufacture of essential components for aerospace, precision engineering products, garments and food processing units among others could manage the adverse impact of the shortfall by diverting orders to manufacturing units in other States. But the happiness of meeting targets remained short-lived.

Prominent buyers, according to Federation of AP Small Industries Association president A.P.K. Reddy, have routed their orders directly to the manufacturing units in Gujarat as it was economically more viable for them. “The daily loss in turnover on account of the power shortages is huge, few hundreds of crores, and major buyers prefer other States, particularly those presumed to be power surplus, to place orders,” he said.

In spite of the drop in the demand from agriculture, the shortage as on Sunday is projected to be 46 million units (MU) with the requirement and generation pegged at 250 MU and 204 MU respectively. This has prompted the utilities to impose restrictions on the supply to these units including observing power holidays for three days a week, affecting their performance.

Given this backdrop, banks that financed these units are also uncertain on whether to declare them non-performing and if so, when. “We are unable to get a clear indication of their performance owing to the power crisis. The situation needs to be monitored closely and we can arrive at a clear picture only during the next quarter,” was how Andhra Bank CMD B.A. Prabhakar summed up the situation while announcing the bank’s quarterly results recently.

Unprecedented shortage

With the shortages reaching unprecedented levels, the APTransco and the Distribution Companies requested the Andhra Pradesh Electricity Regulatory Commission’s permission for generating additional power by costly fuel, RLNG, the regulator is yet to give the consent for the same.

“The situation is likely to improve once the APERC accepts the request for additional generation through RLNG is accepted,” a senior official said.

Till then, the industry is free to opt for Open Access and buy power from outside. “The utilities will collect only wheeling and scheduling charges which are quite nominal,” the official said adding the units will, however, need connection to dedicated feeders of 11 kV, 33kV and 132 kV capacities. The Transco is expecting about 200 units to opt for Open Access facility.

The industry, according to Mr. Reddy, is signing up agreements from power producers, with each unit costing upwards of Rs. 7.30, to ensure that the operations continue uninterrupted till March next year.



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