Peaking shortages to surge further: hint CEA, powermin

Written by Sanjay Jog | Mumbai | Updated: Sep 22 2009, 05:15am hrs
The power ministry and Central Electricity Authority (CEA) have indicated that the mismatch between demand and supply across the country is set to increase further. An early withdrawal of monsoon has increased demand from the agricultural sector for energising pumps, while signs of economic revival have increased demand in the manufacturing and engineering sectors. For August alone, the peaking shortage surged to 16,258 mw (14.2%), compared to 13,565 mw (12.6%) in July. In June, the delayed monsoon had resulted in a peaking shortfall of 15,344 mw (13.8%).

On the other hand, the energy shortage was recorded at 9.5% (6,217 million units) in June, 8.2% (5,557 million units) in July and 10.7% (7,768 million units) in August. As reported by FE last week, power minister Sushilkumar Shinde has admitted that the demand from increased manufacturing activities, a growing population and the rising energy needs of a rapidly growing consumer base has resulted in a situation where the energy supply falls far short of the demand.

A Mumbai-based analyst said, "The situation would have worsened further had the KG-D6 gas not been available. Reliance Industries has already signed a gas sale purchase agreement of 18 million metric standard cubic meters per day (mmscmd) for the power sector." He said even though Indian Energy Exchange and Power Exchange India have launched term-ahead contracts in addition to day-ahead contracts, they may have to strive to carry out transactions due to constraints in the availability of power. Even as captive power projects are able to sell up to 1 mw through exchanges, there are a lot of transaction procedures they need to complete.

The western region, comprising Chhattisgarh, Gujarat, Madhya Pradesh, Maharashtra, Daman and Diu and Goa, is facing maximum peaking shortage, which was 6,947 mw (19.6%) in August, 4,826 mw (15.6%) in July and 5,469 mw (16.5%) in June. Data compiled by the power ministry and CEA shows that Maharashtra tops the list for more deficit compared to other states. The peaking shortfall, which was 2,133 mw (1.26%) in June, rose to 3,236 mw (20.8% in July and surged to 5,733 mw (30.2%) in August. Maharashtra was forced to purchase costly power ranging between Rs 5 per unit and Rs 8 per unit.

A similar trend was witnessed in the north, consisting of Chandigarh, Delhi, Haryana, Himachal Pradesh, Jammu and Kashmir, Punjab, Rajasthan, Uttar Pradesh and Uttarakhand. The peaking shortfall was recorded at 5,917 mw (16.7%) in June, 5,755 mw (16.1%) in July and 5,644 mw (15.7%) in August.

In fact, Maharashtra and a couple of other states recently sought the power ministry's intervention for an excess overdraw by the northern region, endangering the functioning of the national grid. CEA sources said lack of adequate rainfall, particularly in Punjab and Harayana, and fall in hydro power generation led to a surge in deficit.

Curiously, the north-eastern region, which otherwise used to enjoy a power-surplus situation, has witnessed rising peaking demand deficit. The region recorded a shortage of 240 mw (14.8%) in June, which marginally rose to 265 mw (15.9%) in July and surged to 391 mw (22.2%) in August. This is mainly because of low hydro generation.

The power ministry last week said the hydro power generation dipped by 15% due to scanty rainfall largely in the north-eastern region, where several hydro power projects are located.