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Home News Power Sector News Even after privatisation govt. bears the loss - Orissa energy minister

Even after privatisation govt. bears the loss - Orissa energy minister

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Atanu Sabyasachi NayakWhen Orissa was presented as the pioneering state in India which began the process of privatisation of power sector in the mid-90s people hoped bad days were over. Down the years the high expectations still struggle to somewhat match the lofty promises made to the public. Power tariffs were increased many times. Performance and service was deteriorated. Losses mounted like never before. Amid move to increase the power tariff again from April 1, Energy minister Atanu Sabyasachi Nayak spoke to Rajaram Satapathy of TOI to throw more light on the vexed issue.

Why hike in power tariff?
Could it not be avoided when majority of consumers in Orissa are in the domestic sector?
Yes, increase in price of any product is bound to affect people. Power is no different. This is the second successive year when power tariff is going to increase. But we have to appreciate certain problems. Orissa is heavily dependent about 75 percent on thermal power. And the production cost has in the meanwhile gone up by 45 per cent.

The MCL in the last two years has increased the coal price by 40 per cent. Added to it is the five per cent excise duty levied by the Centre. From the NTPC alone we get about 750 MW to meet our daily need of nearly 3,000 MW. It is going to increase the price from Rs 2.62 per unit to Rs 3.22 from April 1.

Power sector is privatized. How is it a burden on the government?
A- Yes, technically government directly does not come into the picture. But it bears the loss indirectly. The job of Gridco, which is a government body, is to purchase power and sell it to the distribution companies. At present, the gap between the buying and sale price of per unit power is about 30 paise. The loss is mounting. It has crossed more than Rs 700 crore. The burden obviously falls on the government.

Do you think the government under the circumstances intends to wash its hands off and pass on the buck to the common people?
No, not at all. The government is quite alive to the net impact of the tariff hike on the people. That is why we placed our views before the Orissa Electricity Regulatory Commission (OERC) suggesting avoiding the hike. We got some positive results. There are nearly 39 lakh consumers in the state.

The hike proposed to be implemented from April 1 is not going to affect nearly 30 lakh of them. They include six lakh in the agriculture and related sector and those in the 0-50 unit category. I do agree the lower and middle class consumers will be hit. Yet we have not given up hope. The government is going to file a review petition before the OERC.

Power seems going to be a precious commodity in the future, given the unabated demand for it in the domestic, commercial and industrial sectors. What is the government doing to face the crisis looming?
As such the power tariff in Orissa is less compared to major states like Punjab, Gujarat, Tamilnadu, West Bengal, excepting certain states like Himachal Pradesh where demand is less and hydro power is available in plenty. Nevertheless, we are not sitting idle keeping in mind the future requirement and possible availability of power in our own state.

We are currently making a three-pronged approach to meet the future power demand. As such the state cannot afford to depend on hydro power because of erratic rainfall for which we are not able to currently utilize 60 per cent of our installed capacity.

However, the state government in collaboration with the national hydro power corporation is going to set up a 320 MW capacity hydro power project at Syndol in Sonepur district. It is likely to be functional in three years.

What about the nearly 30 MoUs the government has signed with private industrial houses for thermal projects?
Two have already started generating. We are hopeful at least three others would be functional in the next three years. This apart, the state government itself is setting up a 2000 MW thermal project at Kamakhyanagar.

A 4,000 MW ultra mega power project by the Central government is planned at Vedabahal in Sundargarh district, while the NTPC is going add 3,000 mw power through expansion of the TTPS and a new project at Darlipali in Sundergarh district. We hope to meet the power demand in the near future when all the villages are electrified and the total numbers of consumers increase to 75 lakh.

What about transmission and distribution?
We have so far improved more than 23 grid systems in the state ensuring quality power supply to places like the capital city. Even places in Kalahandi and Balangir districts which could not be accessed earlier despite availability are now getting power.

We are contemplating to introduce IT solutions as done in Bangalore for bringing further improvement in the power sector. Rs 2400 crore has been earmarked to be spent in three years under the CAPEX programme for improving the distribution system.

The government has also demanded the Centre to give Rs 1500 crore due to us under the RAPDRP. This is a noble project aimed at loss control. Once this money comes we will utilize that in introducing IT solutions. I am confident the overall measures we have initiated will drastically cut down transmission and distribution loss from the present level of 37.38 percent.

Source- Times of India

 

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