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Voice of Electricity Workers EDITORIAL THE STRUGGLE FOR A NEW POWER POLICY In this issue you
will find The main thrust of the Chief Ministers conference was privatisation of Electricity sector with added emphasis on distribution. In his inaugural address he has stated that the performance of the private sector during the last decade was dismal and said they could only produce 5000 MW. “..in the initial phase of reforms in the power sector, we adopted an approach of guaranteed returns to the private producers. This made the tariff unacceptably high. The Dabhol Power Project in Maharastra is a notable example. I hope that this issue will be resolved soon.” and added that the need for a holistic and long-term approach to power sector reforms.” He had to confess that the Dabhol tariff was un acceptably high and the need for a holistic long term approach for power sector reforms but failed to take stock of the experience of privatisation of the Power Sector in many states which could have been easily convinced him that privastisation is not a remedy for the speedy development of power at affordable cost. The experience of Orissa, which is said to be a model for reforms, has miserably failed to achieve any of the projected objectives. The power cost has been increased to two fold. The transmission and distribution loss is on the increase, the private distribution company AES has failed to pay Rs.450 crores to the GRIDCO the generating company and above all they failed to restore power supply to 800 flood affected Villages in the State even after 18 months. The Greater Noida experience is also quite disturbing. The privatised Noida Power Company failed to pay Rs.150 crores to the U.P. State Electricity Board. They are buying power from the electricity board at the rate of Rs.1.4 per unit and selling it at the rate of Rs.2 and collecting money regularly from the consumers but no payment is made to the Electricity Board. The attempts of privatisation in Andhra Pradesh do not have the credit of any improvement in the power sector except hikes in the power rates to unbearable levels. Together with as admitted by the Prime Minister the private power producers did not perform well either in completing the projects in time or keeping the power rates at affordable levels. The private sector is only interested in profit as high as possible. Nothing else is important for them. Not only this is the experience of India, the international experience is also not very different. The latest example is the power crisis in California the mighty state in U.S.A. They have deregulated the power sector and the private sector has now appeared before the people in their true colours. They have artificially created power deficit and power rates had been increased to 10 to 20 times resulting in serious crisis in the State. The California Governor had to come out condemning the private power operators and promised the people that he will take emergency measurers to get out of the mess. He has stated among other things “ We must face reality, California’s deregulation scheme is a colossal and dangerous failure. It has not lowered consumer prices; it has not increased supply. In fact, it has resulted in skyrocketing prices, price gouging, and an unreliable supply of electricity. In short, an energy nightmare.” “My friends, electricity is not an exotic commodity like pork bellies, to be traded in the chaotic equivalent of a future market; electricity is a basic necessity of life. It is the very fuel that powers our high-tech economy.” Therefore Mr. Prime Minister the private route which you are proposing for development of power in the country is dangerous and hence unacceptable. The Prime Minister has also said the total power development in the country is insufficient and the per capita availability is only about 350 units. 80,000 Villages are without electricity and 40per cent of rural households have no access to power. The industrial sector do not get sufficient power and hence he suggested that one lakh M.W addition in the installed capacity within the next decade for which 8lakh crores of rupees is required and 50per cent of it must be entrusted with private producers. In our view this projection is highly exaggerated for bringing in private operators in the power sector. In our note to the Chief Minister’s conference we have made the following observation. “ The approach followed currently for estimating future demand has consistently over estimated the demand and has predicted huge shortages that have not actually taken place. It is this mindset that proposed that power at any cost is preferable to shortages, leading to taking the expensive IPP route, Enron and changing the country’s fuel policy to allow liquid fuel. Based on realistic predictions of current economic and industrial growth, the additional capacity required to be added is of the order of 25,000 MW- 30,000 MW in the each of the next two five year plans.” The above and other suggestions were given for an alternative power policy framework after serious consideration by the experts who have long experience and knowledge in the power sector. There are umpteen issues to be attended which needs changes and corrections for which the Govt. should come forward to appoint an apex body to formulate a new power policy without loss of time giving up the World Bank dictated prescriptions. The handling of the power sector cannot be entrusted with those in the Govt. who do not care for the national interest. Therefore the Engineers and Workers should close their ranks for a decisive battle with the full support of the people for a policy reversal. This can be successfully done only by getting over the vacillation shown by the leadership of many organisations. |
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