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One Nation, One Grid, One Price

Feedback Infrastructure chairman Vinayak Chatterjee says power demand from transmission companies is artificially low due to their financial problems

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Vinayak Chatterjee, Chairman of Feedback Infrastructure, talks about energising India's power sector. He emphasises that growth must cover all key elements of the power industry. Excerpts from an interview:

What has changed for India's power sector in recent years?

It is difficult to talk about power sector as one word, we have to talk about it in five links - fuel, generation, transmission, distribution, last mile and energy saving. If we look at all these 6 things, there has been a massive change in all of them. We are in a positive territory on coal production and surpluses and so far as harnessing sun and wind are concerned, we are making progress.

On gas, a start has been made to use it for running at 35 per cent of plants. Plants today are producing surplus power. In transmission, tremendous work has been done in terms of making it one nation, one grid. In each element of the chain there has been a huge progress in the last two years.

A lot of gas-based capacity is currently lying stranded. How are we trying to revive it?

The government brought out a scheme of reverse auction where gas-based plants can bid that amount to run 35 per cent of efficiency, which allows them to service some of their cost requirement. There has been a complete re-negotiation with Qatar and arrangements are being made to import more gas. It is a long haul and old problem and one can see the genuine efforts being made. Including many changes in hydrocarbon exploration and pricing policy.

State financial health is still an issue. While the ministry of power has done enough to facilitate reforms and UDAY being one such initiative, the ball lies in the court of the states. The dream of 24x7 power will remain a dream till the states come on board. Why?

In many ways the majority of states by signing the UDAY scheme have already come on board. They have committed to reduce the AT& C losses to 15 per cent by 2019. I expect a day to see when all states will sign it and there is a national common agenda to reduce AT&C losses. So in many senses the majority of states have already come on board.

Many thermal power plants in the country are cutting generation due to low demand. In this scenario the consumption of coal has also gone down. So are the power and coal surpluses for real or is it resulting from lack of demand?
Obviously lack of demand. I think nobody is disputing the fact that real demand is there among the consumers. What we see is the apparent demand from the discoms which is not real demand. So we all know the demand from discoms is artificially low because of their constraint fiscal capacity. Hopefully UDAY and similar schemes will increase the capacity of discoms and various other schemes will increase demand from the consuming public.

How can India Inc join hands with the Government in the development of power sector?

In every link in the chain India Inc has a role to play.