India’s Power Sector Challenged by 78,500 MW Additional Power by 2012

---

Researched by Industrial Info Resources (Sugar Land, Texas)--Although estimates of how much India has missed additional power targets vary, a miss is a miss and the estimated gap between targets and performance is widening. In the nation’s 10th Five Year Plan from 2002 to 2007, the target was to add 41,110 megawatts (MW) to national generating capacity. But the actual amount of available additional power is reported as between 17,955 MW and 20,950 MW.

Installed capacity was about 130,000 MW in January 2007 with 85,000 MW of the total provided by thermal plants burning coal, gas and diesel. The new 5 Year Plan through 2012 calls for 78,575 MW of power to be added to the national generating capacity. At the beginning of September, Power Minister Sushil Kumar Shinde said that, against odds, he is confident of achieving this target although the country could not achieve the target in the 10th plan. “We don’t have enough manufacturing capacity,” he said in Bombay. “That is why achieving targets is delayed. We need four to five companies like BHEL, which can supply equipment to meet the requirements of the power sector.”

Earlier, another government official was reported as saying that the best the country could hope for was 7,000 MW more per year through 2012, and that would provide an additional 35,000 MW. He said he believed that 5,000 MW additional power per year was more realistic.

For some months, state-owned Bharat Heavy Electricals (BHEL) has been under pressure from power projects in the construction phase. The country’s major manufacturer of generating equipment, including boilers, turbines and generators, has been unable to deliver in step with project schedules, causing months-long delays on projects and drawing contention about its ability to supply the needs of upcoming projects. Currently, BHEL has the capacity to provide 6,000 MW of power equipment per year, although there are plans to raise this to 15,000 MW per year within the next three years.

Shinde said that ventures in equipment manufacturing between local and foreign companies were being encouraged. Larsen & Toubro have made an agreement with Japan’s Mitsubishi to manufacture super-critical boilers, and the same company is discussing turbine manufacturing with Toshiba. Shinde said the state owned National Thermal Power Corporation (NTPC) was likely to enter into equipment manufacturing. He added that there were projects totaling 47,000 MW “under implementation” but did not say whether any were under construction.

Other power-equipment companies, such as China’s Dongfang and South Korea’s Doosan, are keen to entering the power-manufacturing arena in India. With the lead time required to build and put a manufacturing plant into operation, increased imports of equipment are more likely if Shinde is going to see power additions anywhere near those targeted. Local project managers have been checking Dongfang equipment for compatibility and backup spares and maintenance provision. They are reported to be happy with the initial prices offered.

Industrial Info Resources (IIR) provides marketing communication services ranging from industrial database solutions to market forecasting, custom analytics, and specialty promotions that support high-level image campaigns.