According to reports, looking to bridge the widening demand-supply gap for electricity, the Planning Commission has set a power capacity addition target of 88,425 MW for the current Five-Year Plan period ending March, 2017.
The target is higher than 75,785 MW capacity, corresponding to nine per cent GDP growth, estimated by the Working Group on Power.
“In order to bridge the gap between peak demand and peak deficit and provide for an increased pace of retiring of the old energy inefficient plants, the capacity addition target for the 12th Plan (2012-17) has been fixed at 88,425 MW,” according to draft note on energy sector for the current Plan Period.
However, the capacity addition was just 54,964 MW in the 11the Plan (2007-12) much lower than set target of 78,700 MW.
As per the draft note, out of the projected capacity addition, thermal sources – coal, lignite and gas — would make up for 71,228 MW while hydro would account for 11,897 MW. Nuclear power is estimated to be contribute 5,300 MW.
More than half of the total capacity addition would be from the private sector.
Total generation target for 12th Plan would be 1,18,425 MW, including renewable energy capacity addition of 30,000 MW, the draft note said.
“Distribution is the weakest link in the power system with large losses leading to financial unviability,” it said.
The cumulative losses of state utilities were estimated at Rs 1.06 lakh crore at the end of 2009-10 fiscal.
“The 12th Plan will have to lay major emphasis on expansion of franchisee or Public Private Partnership (PPP) or privatisation in different utilities as a strategy to reduce network losses, improved efficiency of service and consumer satisfaction,” the draft note said.