If 2007 is turning out to be a summer of discontent in India’s financial capital over power shortages, just wait for 2008-09.
A peak 500MW power shortfall is likely to go to 700MW next year and then hit 900-1,000MW in 2009, predicts Prasad Menon, managing director of Tata Power Co., which supplies power to the distribution utilities—Bombay Electric Supply and Transport (BEST) and Reliance Energy Ltd here as well as some bulk consumers. Menon attributes the projected shortage to growing demand from all sectors: residential, commercial and industrial users.
Menon’s company has been at the receiving end from Maharashtra State Electricity Distribution Co. Ltd and the state electricity regulator Maharashtra Electricity Regulatory Commission for its occasional overdrawing of power from the state grid.
Tata Power produces around 2,300MW of electricity of which 1,770 MW is consumed in the city, while Reliance Energy produces 800MW of which 500MW is consumed in the Mumbai distribution areas.
R.R. Mehta, senior vice-president at Reliance Energy, says that the company has projected a 5-7% rise in demand year-on-year over the next two years. Reliance Energy supplied 1,390MW this year and expects next year’s demand could be around 1,450MW.
Reliance Energy supplies to most suburban areas in the city except the Mulund-Bhandup stretch which is handled by BEST, whose officials were not immediately available for comment.
Mumbai city has been facing a growing shortage of power during the morning and evening-peak demand hours, which this year went up to 500MW. Until now, a shortage was met by Tata Power by overdrawing from the state grid.
But, with the state itself facing a overall shortage of 4,500-5,000MW during peak summer months, the commission has ruled out overdrawal from the grid. The demand for power on the state grid has been rising from both agricultural and industrial demand.
This year, the three companies, instead of bidding separately for the additional power available on the national power grid, have been bidding as a single entity, says Mehta. “When we were trying to buy power separately, it was encouraging power traders to quote far higher rates. But, this has narrowed down the field and we have had better bargaining power now that we are bidding together,” he adds.
A Tata Power spokesperson says that the joint committee, which has been set up with Tata Power as the nodal agency for buying power this season, will buy power through the end of June.
The committee has bought power from diverse sources, such as group captive generators in state as well as state electricity boards of West Bengal, Madhya Pradesh and Rajasthan. The committee will resume in October when the agricultural demand in the state peaks.
The October peak demand, which lasts for 15-20 days is expected to be in the region of 400MW, the Tata Power spokesperson says.