SUB-EDITORIAL
INTROSPECTION OF NEW POWER POLICY IN
INDIA
Lest we forget many hundred million people in India are still
struggling for any access to electricity however unreliable. The
promise of distributed generation helds special meaning for them.
As man has a right to life, similarly electricity should be within
the reach of every family irrespective of whatever may be the
income of the family because the path of development routes
through the use of electricity. At the time of independence of the
country, 400 private companies were only operating in the country
not prepared to extend electricity in rural India. So SEB's and
CPSUs were formed under Electricity (Supply) Act 1948 to expand
power sector.
Every society
evolves legislation through evolutionary process accommodating new
concepts and technology to ensure optimal use of resources as per
social needs. The Electricity (Supply) Act 1948 was enacted with
the objective to expand power sector to provide food security,
industry getting power globally competitive, huts of weaker
sections electrified and remote backward areas provided with
electricity and a self-reliant engineering industry producing
power on least cost route to be affordable.
The World Bank sponsored new power policy was introduced on 23rd
October 1991 by the Government of India a short term strategies
whose goals were to attract private investment for resource
mobilization and to contain fiscal deficit. The decades experience
is totally dismal. The generation targets slipped more than 50%
and cost of power increased thrice from Rs.1.09 to 3.12 per unit,
thus failed to address black-outs and brown-outs (continuity -
value is higher than the cost of power). The abnormal rise in
power cost is attributed to inflated cost of IPP plants and base
load thermal power stations were being raised for picking power
demand.
The slogan introduced by the government of India at the advent of
NPP that "costly power is better than no power" has changed at
decades end to "No power is better than costly power" with Enron
imbroglio.
The Enron -
Orissa structures adopted during the decade have put the power
sector in dire-straits. Taking lesson from aforesaid bitter
experience, it was thought that since SEBs are un-sustainable, the
legislative changes will streamline the enabling clauses in E(S)
Act, 1948 to user in a climate of fresh investments to fund the
further future plans of SEBs. Instead of addressing these
problems, Government of India insists on World Bank sponsored
Electricity Bill-2001 repealing basic social objective. So called
comprehensive legislation for power reforms had been introduced in
a cavalier manner without any serious cause and discussion. This
is an untested legislation and nobody believes it will help poor.
Instead the burnt of increase in commercial tariffs will be born
by poor due to unplanned addition of power plants with escalated
costs and super profits of IPPs. Making captive power free from
licence will aid fuel to fire as industry will run away from the
grid and thus Agriculture and domestic consumers will have to bear
the cost of base power stations. Any government support to power
sector will have to be thus much more than present government
support to SEBs.
The rural India will be de-linked from the grid and will be on
stand-alone system and the responsibility of managing electricity
has been left to villagers. This will set in a process of
de-electrification in rural India ruining our agriculture and food
security. The 31% house electrification will dwindle. The new bill
is diversionary in nature and will result in confusion and further
set back to power programme. The crisis will cause large scale
economic and social unrest.
Electricity cannot be stored. Therefore to produce power on
least cost route it is very essential to have very realistic power
surveys. Any high capacity addition of power plants will increase
the cost of power where as if lower capacities increases are
indicated in the survey will bring black-outs and brown-outs.
Another disturbing feature is the shift in the thermal: hydro mix
presently at 78:22 against optimum ratio of 60:40. It is worth
mentioning that on the eve of NPP i.e., in October 1991 Thermal:
Hydro mix was 59:41 and power rates in India were lowest in the
world. The cost of electricity can be further brought down
(least-cost route) by indicating well in advance the plan wise
additions of equipments to engineering industry and to standardize
the size of the units. All the above steps have been given a go-by
by the planners.
Since the inception of NPP, the Government of India and its
planners are eminating constant and continuous attacks on
electricity employees as if they are the sole reason of
power-crisis. This has set in a continuous demoralizing effect on
employees and as a sequel there is sharp rize in pilferage. It was
the need of the hour to establish a policy which envolves
employees in plugging electricity losses. Instead of any
participatory structure for employees and accountability of the
power sector to people, efforts are to set people against
employees. These divisive methods are used to divert the attention
of the people from real problems of the power sector and to
privatize the sector handing over public property worth hundreds
of billions crores to capitalists on throw away prices because the
costs of power sector according to Electricity Bill-2001 will be
accessed on the basis of revenue fetching potential and thus rural
power sector will be handed over just for song.
Pressed to respond to total failure of power sector reforms
pursued since year 1991, GOI is carrying forward failures of one
stage of power policy into another without having been able to
manage the period of transition Keeping in view the huge number of
uncertainties facing the power sector at this point, it would be
foolhardy to put its all eggs in one storage basket i.e.,
Electricity Bill-2001. Electricity is among the most volatile
commodity ever traded. The existing legislation is broad based and
can accommodate desperately needed National electricity strategy.
The Electricity Bill-2001 places energy security a crucial element
of national security outside the perview of state intervention and
at the mercy of finance capital.
