Orissa sees itself emerging as the power generation hub of India, a position that will help it supply electricity to rural areas of the state, sell excess power to other states, and serve as an incentive to companies to set up manufacturing facilities in the state.
Much of this belief stems from the fact that the Centre could allow Orissa a 50% share of the power generated in three 4,000MW power plants, also called ultra mega power plants, or UMPPs, that will be set up in the state at a cost of Rs48,000 crore. The three are not part of the 10 UMPPs originally planned by the Centre, of which one is located in Orissa. In the case of these power plants, the host state gets 30% of the power generated.
Orissa, which doesn’t need as much power as several other large states, is looking to leverage the extra power to achieve its end.
Orissa has a power generation capacity of 4,462.023MW, while it needs only 2,600MW. The state expects to generate around 33,000MW more power by 2012 with demand projected to go up to 5,800MW by 2014.
“Five (coal) blocks in Orissa have been identified having a total reserve of 2,100 million tonnes (mt). This is sufficient to support three more UMPPs. All these projects will be coal pithead projects,” a Union government official, who did not wish to be identified, said. His reference is to the fact that the projects will be located right next to the mines (at the pithead).
“We will be getting 50% of the power generated from these three new UMPPs... The power we get will help us in our rural electrification programme and the surplus power will be sold outside the state. The site selection (for the UMPPs) will now be carried out,” said Suresh Mahapatra, Orissa’s energy secretary.
India has 256 billion tonnes of coal reserves, of which around 455mt are mined every year. Orissa accounts for the second highest concentration of coal reserves in the country (24.60% of the total), lower than just Jharkand (28.95%).
However, analysts believe Orissa will not be able to translate all its plans into reality.
“Coal availability and water linkages are areas of concern for Orissa. There are different coal availability numbers that are doing the rounds. Whether they have the requisite coal availability is to be seen. I have my doubts,” said K. Ramanathan, fellow at The Energy and Resources Institute (Teri), a New Delhi-based research organization.
India’s government originally planned 10 UMPPs across the country. While the projects at Mundra in Gujarat, Sasan in Madhya Pradesh and Krishnapattnam in Andhra Pradesh have been awarded, those at Tilaiya in Jharkhand, Cuddalore and Marakkanam in Tamil Nadu, and Jharsuguda in Orissa are yet to be assigned. The Centre has abandoned plans to set up UMPPs at Girye in Maharashtra, Tadri in Karnataka and Akaltara in Chhattisgarh for reasons ranging from environmental concerns to differences with the state government.
The government plans to help set up these UMPPs in an effort to cater to rising demand for power in the world’s second fastest growing major economy. India has a power generation capacity of 140,000MW and expects to add generation capacity of 78,577MW by 2012.