Union power minister Raj Kumar Singh. (Ramesh Pathania/Mint)
Union power minister Raj Kumar Singh. (Ramesh Pathania/Mint)

Govt moves to chart five-year road map for power sector

  • Raj Kumar Singh to hold a meeting of key stakeholders on Monday to help prepare the power sector road map for the country
  • Power ministry proposes a ‘power sector council’ to address issues between the Union and states as part of a 100-day plan

NEW DELHI : With the National Democratic Alliance government stepping up efforts to supply round-the-clock power to all, power minister Raj Kumar Singh has called a meeting of key stakeholders including company executives on Monday to help prepare the power sector road map for the country, said a person aware of the development.

The day-long meeting to prepare the ‘Vision Document for Power Sector for the next Five Years’ will also have sessions on issues relating to electricity generation utilities, including from renewable energy sources, transmission including green energy corridor and green energy integration, and electricity distribution companies (discoms) including distribution franchisees.

“The meeting is expected to be attended by representatives from ministries of power, new and renewable energy, coal and railways, Central Electricity Authority, public sector units, energy secretaries of the states and discoms, financial institutions, industry lobby groups, and experts," said a government official seeking anonymity.

A power ministry spokesperson did not immediately respond to queries emailed on early Sunday morning.

India has an installed renewable energy capacity of about 80 giga watts (GW) and is running the world’s largest renewable energy programme with plans to achieve 175 GW of capacity by 2022 and 500 GW by 2030 as part of its climate commitments.

The meeting comes in the backdrop of Y. S. Jagan Mohan Reddy-led Andhra Pradesh government’s plan to reopen the power purchase agreements inked under the N. Chandrababu Naidu-led government. According to a Andhra Pradesh government order dated 26 June reviewed by Mint, a Cabinet Sub Committee has been set up to “identify the person/persons/institutions responsible for prima facie mala fide decisions and actions, and recommend appropriate action."

One of the terms of reference of the Cabinet Sub Committee that has spread uncertainty in the India clean energy space is to “Review all investments in power sector and infrastructure projects approved and Power Purchase Agreements (PPAs) executed during this period and recommend appropriate action in case of omissions, commissions, mala fide actions, loss of valuable public resources."

The Andhra Pradesh government has gone ahead with its plans despite the Union government’s efforts to impress upon the state to not do so given the action to revisit PPAs will shake investor confidence.

The meeting also comes in the backdrop of the ongoing crisis in discoms due to their poor financial health, which has led to delayed payment to generation utilities. In an attempt to ensure timely payments by states to electricity generation utilities, the government has made it mandatory for state discoms to offer letters of credit as part of the payment security mechanisms in power purchase agreements.

Accordingly, the National Load Dispatch Centre and Regional Load Dispatch Centres have been directed by the power ministry to “dispatch power only after it is intimated by the generating company and distribution companies that a letter of credit for the desired quantum of power has been opened and copies made available to the concerned generating company." The provisions take effect from 1 August.

The ministry has proposed a “power sector council" to address issues between the Union and state governments as part of its 100-day action plan for the second term of Prime Minister Narendra Modi’s government. Other proposals include separation of wire and power supply business, setting up a pan-India power distributor and building renewable energy management centres.


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