As electricity reached all inhabited villages in the country on April 28, the government now wants to provide connections to every household by December 31, 2018, three months ahead of an earlier deadline set under the Saubhagya scheme.
As electricity reached all inhabited villages in the country on April 28, the government now wants to provide connections to every household by December 31, 2018, three months ahead of an earlier deadline set under the Saubhagya scheme. The government estimates that this itself would raise power demand by about 28,000 MW or 18%, but would have a ‘multiplier effect’ on the demand as the electricity connections would trigger ancillary industries in rural areas.
Any potential avenue for demand growth should bring some cheer to power plants operators as nearly 20,000 MW of coal-based power plants do not have any power purchase agreements to sell electricity. Another 20,000 MW of such plants are under various stages of construction. Though showing some positive signs in the recent past, tepid demand growth over the past few years have been a dampener for the power generation industry.
Plant load factor (PLF) for private power plants have slipped further to 55.1% in FY18 from 55.9% in FY17. PLFs of less than 60% make it difficult to service debts. Stressed assets in the power sector consist of 34 private power plants with an outstanding debt of Rs 1.74 lakh crore.
“On a ballpark basis, an average load of 1 KW per household for eight hours in a day, there will be requirement of additional energy of about 80,000 million units (MU) per annum,” an official said on condition of anonymity.
“Demand growth would also depend a lot on how electrical and consumer-durables industry price their products to tap the new rural growth avenue,” another official said. At 1,075 units, the average per-capita electricity consumption rate is one of the lowest in the world, even lower than the India’s emerging economy counterparts.
The government has put more focus on rural electrification which can be reflected from the Rs 24,890 crore Central fund released in this regard between FY15-18, compared with Rs 10,874 crore between FY11-14. More than 3.1 crore rural households currently remain unconnected. More than 50 lakh households have been connected under the Saubhagya scheme since its launch in September, 2017.
The government wants to connect more than 13 lakh unelectrified households under the ‘Gram Swaraj Abhiyan’, which targets complete implementation of seven Central government schemes (including Saubhagya) across 20,000 villages in 22 days, ending May 5. As on April 30, 77% of this target was met.
Power minister RK Singh told reporters here on Tuesday that the government is also planning to pre-pone the deadline for ’24X7 power supply’ by three months to December 31, 2018 as well.