11th Plan power capacity may constrain growth

PM's energy panel says 62,000 Mw will not sustain 8-9% GDP growth.

The Prime Minister's Energy Coordination Committee (ECC) has questioned the 11th Five-Year Plan projection of 62,000 Mw capacity addition in the power sector.

The committee has pointed out that sustaining an 8-9 per cent economic growth would require a capacity addition of 75,000 Mw if the backlog in the 10th Plan (2002-07) is taken into account. This is 13,000 Mw more than the 62,000 Mw projection made for the next Plan period.

"The power projects under construction, expected to come on stream during the first four years of the 11th Plan, may add up to around 25,000 Mw of capacity," government sources said. In this scenario, for 50,000 Mw capacity the work on these projects must be started by 2007.

What makes the situation interesting is that even if work on all the first five ultra mega power projects, with a targeted combined capacity of 20,000 Mw, is started, no more than 4,000 Mw will come into production by the last year of the 11th plan.

"However, the ECC is of the view that power capacity addition under current dispensation is unlikely to solve problems in the power sector," sources added.

The apex committee is also of the opinion that the 11th Plan will need around Rs 2,50,000 crore investment in transmission and distribution if the additional power generated is to be absorbed.

"This investment is including the backlogs as past investments in transmission and distribution has been less than 40 per cent of the need," sources said.