This addition of 36,257 Mw by the private sector is the highest it has delivered till date in a comparable period. The contribution of central sector is 16 per cent of the achievement; states did the other 21 per cent of the total. This is a major leap over the 11th Plan capacity addition, wherein the private sector contributed 21,719 Mw. The target for the private sector to meet in the coming two financial years is 43,540 Mw.
“The growth of the power sector in India during recent years shows the value and speed private players have brought to the sector. Hence, it is imperative for the government to push the PPP (public-private partnership) model and create an environment for private players to continue with their efforts to meet the country’s target,” said Ratul Puri, chairman, Hindustan Power Projects.
“This record capacity addition is due to exuberance of the private sector in 2008-11. However, by this year’s end, a downward trend would begin. There is no new capacity coming and much of the current capacity do not have any power purchase agreements (PPAs). Even for future projects, there is no healthy pipeline of PPAs,” said A K Khurana, director general, Association of Power Producers, representative body of private generatoring companies.
The coal mine auctions and new gas supply mechanism are estimated to rescue stranded capacity of 25,000 Mw. There are still concerns over evacuation of the power, given the dearth of PPAs as state utilities are short of cash.
“The current government has struck the right chords. However, success can be felt only when the financial challenges of the sector, along with the health of distribution companies, are addressed appropriately,” said Puri.