POWER FAMINE // FOOTPRINTS OF TREACHERY

Subhas Chandra Pattanayak

As severe load shedding is torturing Orissa, we deem it proper to dwell upon the past that has given birth to the present predicament.

In the preceding posting, my attached Oriya article depicts the details of how the then chief minister Biju Patnaik had sabotaged the State by obliterating the Orissa State Electricity Board to amass personal wealth, as suggested by the shrewdly executed scam involving a foreign firm called K.P.M.G. Management Consultant.

The situation has become catastrophic in the ongoing regime of his son, as established by unprecedented power-cut in the rainy season at the moment.

I am giving yet another dose of my dealing with the subject in Oriya language, published then in my column SINGHABALOKANA for the people of Orissa to know the footprints of treachery that has overwhelmed the State.

The attached article is scanned from my book of the same title and carries the date of its first publication in Orissa’s mainstream major, The Sambad.

01020304050607

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CESCO Needs be Prosecuted by the State in Uma Ballav Case

Subhas Chandra Pattanayak

Former MLA Uma Ballav Rath, presently in BJP, is more known for his opposition to illegal allocation of several thousands of acres of land to a dubious private project styled the Vedanta University.

He is one of the persons that have exposed the Naveen Patnaik component of corruption in acquisition and allocation of the huge marine drive land to the commercial hub conceived by Anil Agrawal under cover of the so-called university oblivious of the reality that any such private business in that location would also be detrimental to the defense of the country.

The favor has been held illegal by the High Court of Orissa that has also issued a mandamus for return of the acquired land to original owners thereof. It is certainly very embarrassing to the Chief Minister.

In such an environment, a surprise raid on Rath’s house by CESCO to determine whether or not its electric meter was tampered with, is not a matter to be ignored by the civil society.

Therefore, when news spread that the CESCO authorities were trying to embarrass the Rath family when Uma Ballav was not present even in the town, members of the civil society rushed to his rescue and stopped the raid party from escaping till law takes note of the motivated mischief.

No male member of the family was present in the house when the CESO raided. The mother and the wife of Rath were the only ones that were present when the raid party stormed into the house.

Informed of this, Rath rushed back to his home and to his horror found that the meter had been broken by the CESCO raid party.

It was found that the raid party had no legal authority to force their unannounced entry into the house of Rath during his absence and to break the meter to the utter disadvantage of the house owner.

Rath has informed the Police of the mischief and declared to sue the CESCO as well as the persons concerned if the Police does not take immediate steps for prosecution against them.

CESCO did not do such surprise raid anywhere in the neighborhood the same day. It establishes that the raid on Rath’s house was deliberate and highhanded.

Penal action against this illegality is essentially a must to save civil society from conspiracy of administration.

India Should Seek Nobel for Dr. Asoka Kumar Misra

Subhas Chandra Pattanayak More than the end result, methods invented by scientists to fetch results of world importance at the end have formed the crux of consideration for Nobel Prize this year. This should inspire India to seek Nobel Prize for Dr Asoka Kumar Misra, whose invention has given birth to a new era of controlled application of electricity in manipulating matters into a desired state of world utility. Misra’s technique was first published in the referral journal of United States of America, ‘The Metallurgical Transactions A’ in 1985 and subsequently his final version was published in February 1986 edition of the same journal. He obtained United States of America Patent No.5253696 in 1993. We have in these pages given hint to how after publication of this patent, bearing details of his method, several persons and concerns have started using the same method and how several claimed inventions are based on the method invented by Dr Misra. If controlled application of electricity in metamorphosing matters into desired state of utility in the sphere of metals to medical science and beyond is treated as the new era of technological evolution, Misra should certainly be acknowledged as the father of this era. That, he is not yet considered for the Nobel Prize, is because of the fact that, forced by circumstances to stay at Bhubaneswar, away from the global mainstream, he is not able to stay focused in the world of science. I know many of thinking minds that visit this site. My appeal to them is that they should peruse the links given in this post to appreciate how original is Misra’s contribution to creation of matters of global utility through the method of controlled application of electricity. If creativity in science keeps any meaning for the Nobel Prize, Dr Misra is the man, who should be the best choice for the same. And, India should espouse this sans any delay.

Orissa Prepares for Earth Hour 2010

In the study of journalist Subhas Chandra Pattanayak the first preparatory meeting for Earth Hour 2010 at Bhubaneswar was held on February 27. It was unanimously decided to observe the event on March 27 from 8.30 to 9.30 PM by involving more persons than last year.

Earth Hour is a global event organized by World Wide Fund for Nature and is generally held in the last Saturday of March asking households and industry to turn-off their lights and non-essential electric appliances for one hour to raise awareness on necessity of peoples’ unity for reduction of carbon footprint of power generation.

Conceived by WWFN of Australia and The Sunday Morning Herald and responded to initially by 2.2 million residents of Sydney on 31 march 2007, the innovative action has captured the imagination of peoples, leading one billion persons in 4088 cities of 88 countries across the world observing Earth Hour last year. More and more rural populace gladly joining the campaign, Earth Hour has come to be known as the hour when the world unites in a stand against global warming.

Placing the keynote address, Er. Nagendranath Mahapatra, Honorary Advisor, Eastern region Indian Institute of Sustainable Development revealed that five million people in 56 Indian cities participated in Earth Hour 2009 and this single step helped the country save 1000 MW energy when in Orissa it was a saving of 100 MW energy in the reign of evening peak demand.

To make the event a success, Mahapatra’s appeal was approved to adopt at least ten steps to reduce carbon footprint. They are:

1. Turning-off lights from 8.30 to 9.30 in the evening;
2. showing support and adding to the list of global citizens caring the Mother earth;
3. talking about Earth Hour in social network forums;
4. celebration of get-together with friends and family by hosting an Earth Hour party;
5. rallying local council and community groups to organize Earth Hour events;
6. making of Earth Hour Lanterns as a symbol of hope for the future;
7. Enjoying a family dinner by candlelight;
8. sitting in dark and sharing stories;
9. holding a night picnic with family members and friends in a local park or inspiring them to enjoy each other’s company in gazing at the stars; and
10. Finding new creative ways to mark Earth Hour 2010.

Government doesn’t bother to halt power famine, will the Assembly please?

HERE WE PLACE A GENERATION PERSPECTIVE PLANNING FOR ORISSA TO MEET THE PRESENT AND FUTURE POWER DEMAND

(With input from Orissa’s eminent power-professionals and planners)

Due to lack of vision and planning, Orissa is at present facing power shortage of about 1200 MW during evening peak hours (from 6 PM to 11 PM) and 600 MW during off-peak hours (the balance 18 hours of the day) as she is unable to meet its evening peak demand of 3200 MW and average demand of 2500 MW even though it is endowed with two super rich coal fields at Talcher and Ib Valley which can generate thermal power of 1 lakh MW for 100 years with hydro potential to harness about 10,000 MW and Renewable Energy potential of about 20000 MW.

As per the Economic Survey for 2008-09 of Govt. of Orissa, the Gross State Domestic Product (GSDP) has registered an annual compound growth of 6.97% over the period 1999-2000 to 2007-08 whereas the demand for electricity has registered a little over 10% during the period 2005-06 to 2008-09.

So it is time to stop thinking of five-year plans for generation planning for capacity addition and to focus in stead on 10, 20 & 30-year scenario. In a rapidly transforming economy, the winners will be the ones who think further ahead. If the state of Orissa as a whole has to be winner, the systemic capacity addition for generation of power has to be planned with great caution and with a serious exercise as power lies in the core of the core sector. The World Management Guru Sri C.K. Prahlad now talks of India at 75 i.e. the year 2022 to consider India’s potential to become a super power. TERI has prepared a Report “GREEN INDIA-2047” to make a really Green India at 100 i.e. in the year 2047. Ministry of Power has already under “VISION-2032” outlined the Integrated Energy Policy which projects the required installed capacity of India at 962 GW and the energy requirement at 4973 BU based on estimated GDP growth @ 8% in FY 2031-32. It would therefore be proper to map the possible power scenarios for the State under “VISION-2025” as power-scientists and planners involved with this site are harping on.

Electric Power Survey

The 17th Electric Power Survey (EPS) Report on India published by CEA in March, 2007 made the forecast for the power demand of Orissa for 11th, 12th & 13th as under Table-1.

As per the Report on Power Supply Situation of CEA for the month of April-Sep,2009 (FY 2009-10), the Orissa System met the peak demand of 3120 MW against the required Peak Demand of 3188 MW and the Energy Availability was of 10599 MU against the actual Energy Requirement of 10728 MU. Orissa will be requiring an installed capacity of about 6780 MW around 2012, 9620 MW around 2017 and 15300 MW around 2022 to cater to the peak demand of 4459 MW, 6330 MW and 10074 MW projected by CEA for 2011-12, 2016-17 & 2021-22 respectively. As against this, the present availability is about 2000 MW. Hence peak shortage is about 1200 MW & off-peak shortage is of about 600 MW. The installed capacity of Orissa from the Central Sector share & State sector is about 4060 MW as on 31.03.2009. Orissa has to add generation capacity of about 2700 MW, 5500 MW and 11,000 MW to cater to the state demand in 2012, 2017 & 2022 respectively considering the installed capacity of 4060 MW as on 31.03.2009 as the base.

As against the requirement of 2700 MW additional installed capacity and about additional energy availability of 7000 MU up to 2012, Orissa may expect additional power from the available sources during 11th plan as under Table-2.

The State has to source an additional 2000 MW in 2011 & 2012 to meet the projected demand made in EPS prepared by CEA, which in July, 2009 has published a Booklet on “Equipment and Key Input Requirement” for the power sector 12th Plan & beyond and has outlined the capacity addition for 12th & 13th Plan for the country as under Table-3

The fund requirement for generation, transmission and distribution during 12th Plan & 13th Plan as the CEA has assed is under Table-4.

CEA has already undertaken the advance action for the projects to be constructed during 12th Plan from now onwards mobilizing the resources and placing the orders for procurement of Equipments for both Main & balance of plants, so that there shall be no slippage in targeted capacity during 12th Plan.Table-5 shows the status of projects under construction of 72,798 MW as on 31.08.2009.

Orissa has to chalk out similar capacity addition programme in generation for addition 5500 MW for 12th Plan in which all the necessary preliminary works including financial closure should have to be achieved by December, 2009 and the project works should start from January, 2010 to be in stream for commercial generating during 12th Plan period. The associated transmission connectivity should have to be also finalized by June, 2010 so that connectivity issue should not crop up at the time of commercial generation of power.

The road map to meet the power shortage, capable of meeting the future power demands of Orissa, may be drawn on short term, medium term and long term basis in the time horizon of less than one year, more than one year but less than three years and three years plus respectively.

Short-term Measures

They include (1) Injection of Surplus Power by CGPs, (2) share from unallocated quota of Central Generating Stati and (3) Harnessing of Solar Power.

Injection of Surplus Power by CGPs

CCPPO during hearing in OERC on 15.10.2009 has assured to inject about 400 MW power provided CGP’s surplus power is paid @ Rs. 4.50/kwh as the Market Price discovered in Power Exchanges averages @ Rs. 10/kwh and has gone upto @ Rs 17/kwh for which CERC has imposed capping on the price for 45 days limiting it to Rs. 8/kwh. OERC has issued orders with a very attractive price for surplus power from CGPs ranging from Rs.3.10/KWH to Rs.4.05/KWH.

Orissa share from unallocated quota of Central Generating Stations

Govt. of Orissa may urge upon GOI, MOP to allot additional 600/700 MW through emergency allotment from 15% unallocated quota of NTPC stations like Farakka STPS, Kahalgaon STPS, Talcher STPS etc. And,

Harnessing of Solar Power

The installed capacity of Soar Power of India is only 6 MW as on 31.10.2009. Eight nos. of IPPs have been permitted by OERC to install Solar Photo-Voltaic (SPV) Plants of 5 MW and 10 MW capacity and the State Commission has given a very attractive tariff of Rs.15/KWH for first twelve years of commercial operation and @ 7.50/KWH for the period from 13th year to 25th year of operation. Govt. of India, Ministry of New and Renewable Energy (MNRE) have issued guidelines that these SPV Plants which commence its construction works by December, 2009 and commence commercial operation by March, 2010 are eligible for subsidy @ Rs.12/KWH for first twelve years of their operation. Based on these stipulations, eight nos. of IPPs may add SPV capacity of about 70/80 MW in Orissa grid as Decentralized Distributed Generation (DDG) by March, 2010 which would help the state to meet the power shortage to some extent. This requires urgent cohesive action by the State Govt., Deptt. of Energy, Deptt. of Science & Technology, the State Nodal Agency OREDA and the State Trading PSU GRIDCO so that Orissa will be a pioneer state in India to add 80 MW Solar Power by March, 2010.

Medium term measures

They may be Brown-field expansion and Energy conservation.

Brown-field expansion

Putting emphasis on Brown-field expansion, the State Electricity Regulatory Commission has been advising the State Govt. since 2006 with reminders in 2007 & 2008 u/s 86 of the Act to immediately start the expansion projects at IB Thermal (2×660 MW) and Talcher Thermal (2×660 MW) to cater to the power need of the State.

These brown-field expansions only take the constructions/gestation period of about 30 months for commercial generation of power. The Government of Orissa should immediately start these brown-field projects exerting pressure on OPGC and NTPC.

Energy conservation

Bureau of Energy Efficiency (BEE) of Ministry of Power, Govt. of India has launched a Unique Energy Conservation Scheme on 25.02.2009 in the National Plane styled as Bachhat Lamp Yojana (BLY) where BEE intends to give 50 lakhs CFL bulbs of capacity 11 watts to 23 watts to each distribution company @ Rs.15/- each to replace all the incandescent 60 W/100 W bulbs as these CFLs will give the same lumens output with the required illumination. It is tentatively estimated that the State of Orissa can reduce its peak demand from 6 PM to 11 PM by about 400 MW if these 4 DISCOMs can implement the BLY in their area entering into a tripartite agreement with BEE and their empanelled CFL Manufacturers/Traders with a token investment of about Rs.20 cores in FY 2010-11 but they will earn annual profit bonanza from FY 2011-12 onwards of about Rs.80-90 crores/month. Govt. of Orissa and OERC should direct and insist on all the four Distribution Companies to adopt BLY of BEE as “MISSION-2010” and DISCOMs should be directed to complete the BLY in their DISCOMs by end of 2010 so that Orissa can reduce its 40% evening peak demand by end of 2010 due to this BLY alone.

Long Term measures

(1) Thermal Projects under MoU

On this leg, the companies having signed MoUs must be made expedite their work.

In the International Conclave on Power Sector on the “12th Five-Year Plan and Beyond” held on 18th and 19th August 2009 at New Delhi, Thermal Projects as under Table – 6 have been firmed up by CEA and MoP for materialization in the 12th plan out of the 21 MOUs for Thermal Projects that have been signed by the Govt. of Orissa.

The State may get 25% to 30% share of about 1125 MW from these four Private Thermal Projects expected commercial generation during the 12th plan period.

(2) Thermal project of OTPCL

Orissa should give top priority to start the construction work of OTPCL’s (JV of OHPC and OMC) 2000 MW Thermal Project near Rengali from April, 2010 for which Ministry of Coal, Govt. of India, has allocated a separate Coal Block so that the 1st stage of Project (1000 MW) can be completed by 2015 and 2nd stage project (1000 MW) by 2018.

3) Orissa Ultra Mega Power Project

Govt. of Orissa should urge upon MOP & PFC to put Orissa Sundargarh UMPP in a fast track mode to auction and finalize the award to private developer to complete this UMPP in the 12th plan period from which Orissa is slated to get about 1300 MW power. And,

(4) Thermal Projects developed by IPPs

The Govt. of Orissa has signed 21 MOUs with 21 nos. of IPPs to develop about 25000 MW of Thermal Power in the State. The Govt. should immediately sort out the land, coal and water linkage problems of these IPPs so that instead of 4500 MW expected in the 12th Plan, Orissa may add about 12000 MW during the 12th Plan period. The balance 13000 MW may have to be planned to come up in 13th and 14th Plan period.

Suggestions for improvement of ailing Orissa Power Sector

1. The Govt. of Orissa should prepare a generation plan for capacity addition under “VISION-2025” by March, 2010 and outline therein the Road Map of capacity addition.

2 The Govt. should immediately appoint a full time three-member Task Force to monitor the power sector developments continuously so that Orissa can be saved from the power famine that is looming large over the State in short-term and to prepare Orissa to undertake capacity addition under “VISION-2025”.

3 The Task Force should be headed by eminent Power Sector professionals from Orissa having expertise in Thermal, Hydro & Techno-Commercial matters relating to the Orissa Power Sector.

4 The Task Force should monitor all upcoming Power Projects and associated connectivity issues for the 11th and 12th Plan and take advance action plan for projects to come up in 13th Plan as indicated below:-

(a) Thermal Projects of private developers, other Govt. PSU and UMPP to be setup through award/auction to be processed by PFC.

(b) Hydel Projects – large, medium, small, Mini and micro Projects.

© Renewable Energy Projects – Solar, Wind, Biomass etc. now coordinated by OREDA as the State Nodal Agency for Centralized and Decentralized Distributed Generation (DDG).

(d) Connectivity and power evacuation from all the upcoming projects mentioned under “VISION-2025”.

(e) Energy conservation measures for avoided generation in the line of guidelines of Bureau of Energy Efficiency (BEE) to monitor the BLY under “MISSION-2010” Programme and other associated conservation measures formulated by BEE from time to time.

POWER SCENARIO IN ORISSA IS BLEAK AND BLACK

NAVIN PATNAIK CHEATS PEOPLES WITH BROWNOUT AND UNSCHEDULED AREA LOAD SHEDDING

Subhas Chandra Pattanayak

Darkness is looming large over Orissa power sector in these summer months of 2009. The water level in all the hydro reservoirs of the State is inching towards rock-bottom drawdown level.

Chief Minister Navin Patnaik and his braggart energy minister S. N. Patra are boasting about constant power supply to consumers in the State. But in reality they are cheating the peoples with constant brownout and unscheduled area load shedding.

They know there is power shortage. Not to irritate the voters in the election environment, they had executed a short-term power banking agreement with the Power Trading Corporation of India Limited (PTC India) on 24 February 2009 to draw 150MW of power from NDPL, New Delhi from 25.02.2009 to 31.03.2009 for a period of 18 hrs daily from 6 A.M.

Patra had boasted before the Press of this “innovative energy banking arrangement”, which in his words was beneficial to Orissa as the GRIDCO would receive costlier power but will return the same with cheaper hydropower` during coming monsoon days.

But he has not dared to tell the peoples so far that this “innovative arrangement” went haywire and died a clumsy death only three days after the commencement, on 27th February 2009, with a very small quantum of 50 MW Power received in total.

Taking into account the bleak situation and possible harassment of the public the electricity regulatory authority of Orissa (OERC) has delivered a decision fixing a logical price for power to be procured from Captive Generating Plants (CGPs) but due to dormancy in administration, they are injecting only around 200 MW to the state Grid. The result is, shortage in the system of over 200 MW, which is now managed by brownout and other unfair practices hinted to above.

The unfair practice is such a guarded secret between Chief Minister Navin Patnaik and Energy Minister S.N.Patra on the one side and on the other, mendacious mandarins in GRIDCO and distribution companies (DISTCOs) that the Chief Secretary of the State is at a loss to understand as to why his department and other heavy departments in the Secretariat have caught fire so many times in this week.

Constant but clandestine brownout is the cause of this fire. Fans, Computers and Air Conditioners running in constant low voltage catch fire, the CM knows. As he knows the reason, he has not issued any order for determination of the cause of frequent fire in the Secretariat.

However, the irritating truth is that due to failure of the State government to act earnestly in power sector, the situation is bleak and black. The State is warming up towards the great summer and it is estimated that the A.C. and fan load will put an extra burden of another 100 MW in the system.

OUR EARLIER WARNING

Earlier in an article captioned “Darkness Looms Large Over Orissa Power Sector” published in these pages on 28 January 2009, we had analyzed the present demand and supply vis-à-vis its projected requirements in Orissa Power Sector up to 2014-15 wherein we had emphasized on immediate action plan to meet the short-term as well as long-term requirement of power.

Orissa has reached a break neck situation with regard to demand & supply of power due to no addition of generation capacity after commissioning of Upper Indravati Hydro Electric Project in FY 2001.

Current availability from all sources – hydel and thermal – in a year of normal rainfall is around 18212 MU with peaking capacity of 3000 MW that may meet the present demand just about the margin.

Unless the Govt. takes appropriate initiatives in a time-bound manner for generating stations to be established by the Independent Power Producers (IPPs) and such other future units (which take time to be erected and commissioned), the State may not be able to meet the demand for power, we had warned.

A bad monsoon will be ruinous for the State’s economy, which calls for sufficient spinning reserve to maintain continuity of supply of electricity.

Therefore, we had suggested that appropriate steps be taken for completion of brown–field projects like expansion of Ib Thermal Power Station by OPGC and TPS at Talcher by NTPC and early implementation of project by IPPs in the State so that the State can continue to maintain a comfortable power position and meet the upcoming industrial loads and massive Rural Electrification under schemes like RGGVY and BGJY.

But Chief Minister Navin Patnaik is too engrossed in propaganda of his father’s name to rise to the reality as a result of which power supply in the state is in utter disarray.

CASE OF GRIDCO

GRIDCO, functioning as the designated entity for procurement of power from generating stations and for bulk supply of power to DISCOMs in the ambit of Single Buyer Model, has filed as many as 15 applications in Orissa Electricity Regulatory Commission (OERC) for procurement of surplus power from CGPs.

The Commission heard the matter on 25.02.2009 where the representatives of GRIDCO, Confederation of Captive Power Plants of Orissa (CCPPO) and CGPs submitted their views/suggestions on sale /purchase of surplus power from CGPs of the State.

During hearing in OERC on 25.02.2009, the GRIDCO submitted that it has been procuring scheduled surplus power from different CGPs of Orissa at the graded rates of Rs.2.02 / KWh up to 8 MU per month, which is less than 10 MW on an average per day; Rs.2.30/KWh up to 8 MU and above per month, which is about 10 MW or above on an average per day and Rs.2.50 / KWh up to 32 MU and above per month, which is about 40 MW or above on an average per day.

GRIDCO has procured about 786 MU surplus power from CGPs and Co-Generation Plants of the State during the period from April to December, 2008, which includes 104.57 MU from CGPs like NALCO, RSP, IMFA and HINDALCO against 352 MU approved by OERC for Annual Revenue Requirement (ARR) of FY 09 for; 233.47 MU from Co-Generation plants like NINL, Arati Steel and TATA against 300 MU approved by OERC for ARR FY 09 and 447.50 MU from other 10 Nos. of CGPs.

The four DISCOMs and the long term open access customers like ICCL and NALCO have already overdrawn about 900 MU of power during FY 2008-09 (up to 31.01.2009) which is more than the quantum approved by OERC for the corresponding period.

As compared to the FY 2007-08, all Hydel Stations of Orissa are expected to generate about 2000 MU less in FY 2008-09.

GRIDCO has estimated that Orissa may have to face power shortage up to June 2009 of about 300 MW considering the present injection from the CGPs to the tune of 130 MW.

Due to such deficit power scenario, GRIDCO is procuring high cost UI power sometimes even by paying Rs.8 / Unit or more.

CGPs of the State have represented to GRIDCO that due to global meltdown, there is downsizing of production by the manufacturers / industries and consequently demand of power has gone down. Due to crash in commodity price in the world market, power has now become their main commodity for sale for these electro-metallurgical industries having the CGPs and therefore, the industries intend to sell their surplus power at higher price so as to sustain in such recessionary situation.

Some of the CGPs like NBVL, Jindal Stainless Ltd., Hindalco, NINL, Arati Steel Ltd., Shyam DRI etc. have already applied for Open Access so as to sell their surplus power outside the State through power traders or through Power Exchanges at higher rates.

GRIDCO has collected the information from the State of Chhatisgarh where CGPs are selling surplus power to the State Grid at te rate of 280 P/KWh.

In its ARR application for FY 2009-10 it has therefore proposed a rate of 300 P/KWh for procurement of surplus power from the State CGPs.

As per the CGP Pricing Policy published by OERC, the GRIDCO has called for the bid and cost of generation data from different CGPs through bid document in line with the firm and infirm power as envisaged in the said Policy. Thirteen CGPs have submitted the bid documents, quoting their lowest price (inclusive of 10% of cost of generation), which varies from Rs.3.85 to 5.68 per KWh. Two CGPs have submitted their bid documents, quoting their lowest price (inclusive of 10% of cost of generation), which are Rs.4.19 and Rs.5.15 per KWh.

GRIDCO wanted to impress upon the Commission that the rates quoted by different CGPs are quite high. The rates are varying from Rs.3.85/KWh to Rs.5.68 / KWh. It would be difficult to procure power by GRIDCO at such a higher rate for the State consumption.

There are also subsisting bilateral agreements of GRIDCO with CGPs like NALCO & IMFA. They are pressing hard for higher rates due to rise in coal and oil prices.

GRIDCO requested the Commission for necessary and appropriate orders in this regard, suggesting the Commission to consider and approve a flat rate of 300 P/KWh for harnessing surplus power from the State CGPs for the consumption in the State as the bulk supplier expects a shortage of about 300 MW of power up to end of June 2009 (430 MW without CGP injection ) and requested the State CGPs through the Commission to come forward to help the State of Orissa to come out from the present power shortage scenario by injecting a minimum of 430 MW to State Grid from 1st March, 2009 to 30th June, 2009.

CASE OF CCPPO

But during the hearing on 25.02.2009 Shri Sanjeev Das, Secretary, Confederation of Captive Power Plants of Orissa (CCPPO) has refused to recognize the shortage of power in the State and stated that the confederation would support the State Grid with committed quantity of injection of surplus power from CGPs to the tune of 450 MW which may go up 600 MW in the future provided an appropriate price for such surplus power is decided by the State Commission.

While the global recession is already taking its toll on the industries and the prospects warrant sustainability only through a reasonable return on power supply, CCPPO requested the Commission for permission of Open Access from the State Utility as per the provisions of the statute.

CCPPO’s apprehension is that if its above noted proposals are not agreed to, some of the industries will be forced to shut down leading to loss of revenue by Government of Orissa on the sale of principal products as well as loss of employment of many direct or indirect workers creating law and order problems.

Its final averments stressed on a graded rate of Rs.3.10 per KWh with suitable ascending slabs for the consumption inside the State; an appropriate price in the range of Rs.3.50 to Rs.3.80 per KWh for the CGP power traded outside the State. It insisted that all the Captive Generating Plants / Co-generating plants be suitably paid every month for their contribution for consumption inside the State / outside the State as per the certification of a competent statutory body and captive generating plants / co-generating plants having subsisting agreement be not discriminated against.

ORDERS OF OERC

The Commission at Para 12.13 of the Order dated 14.03.2008 had mentioned that the surplus power from CGPs should be procured through a competitive bidding with a rider that the bid price is to be within the maximum of 10% of the cost of generation of the particular CGP for consumption by the State Utilities. The State Utility for the purpose of trading, if considered appropriate by the Purchasing Utilities, may absorb prices higher than this.

The CGP Pricing Policy stipulates that subsisting contracts with the State Designated Agency have to be dealt with according to the terms of the agreement based on their MOUs with the State and are not covered within the ambit of that order. At present GRIDCO has subsisting MOU with NALCO and erstwhile ICCL, which in the mean time has been merged, with IMFA. While GRIDCO has purchased 66.64 MU from NALCO at a rate of 141.21 paise per unit, it has purchased 3.03 MU from ICCL at a rate of 93.60 paise per unit from April, 08 to January, 2009.

The Commission observed from the Bid Statement submitted by GRIDCO that the bidders have quoted price in the range of Rs.3.85 per KWh to Rs.5.68 per KWh for supply of about 210 MW during March, 2009 and about 220 MW during FY 2009-10. These bids are based on their respective costs, particularly that of fuel and its availability.

The Commission observed from the Power Trading scenario in the two National Power Exchanges IEX and PXI for the period from 21st February,2009 to 27th February, 2009 and noted the weighted average cost of traded power in IEX at Rs.6.33 per KWh and that in PXI at Rs.6.99 per KWh.

The Commission has noted with great concern the current status of power availability, given the current hydro situation and the present forecast of a deficit in total availability, which is seen from the submission of GRIDCO. In the absence of CGP injection of 130 MW, the overall requirement of availability may rise to 430 MW as per GRIDCO’s admission during the hearing.

The Commission has also noted from the submission of CCPPO that the global recession is already taking its toll on the industries and the prospects warrant sustainability only through a reasonable return on power supply.

Power sector in the state is now facing a peculiar situation wherein in one hand the CGPs can inject about 450 to 600 MW power to the State Grid if a suitable price is paid to them at this juncture. At the same time GRIDCO is not burdened with costlier powers than that of the highest cost of generation from a thermal power station in Eastern Region, which hovers around 276 P/KWh. If a suitable price is not paid to CGPs, they are eager to trade in Power Exchanges or through bilateral route in open access mode at a much higher price than the bid price. CCPPO – the representative body of the CGPs apprehends that if the proposal for a suitable / appropriate price for surplus power of CGPs is not agreed to, some of the state industries will be closed. GRIDCO’s concern, on the other hand, is that if the power is purchased at a higher cost and this additional cost is not passed on to the consumers through a rise in Retail Supply Tariff, the Distribution Companies would not be able to pay to GRIDCO the cost of power supplied and in turn GRIDCO would default in paying to the generators. It, therefore, submitted that the Commission should take a rational view in striking a harmonious balance to protect the interest of generators, the Bulk supplier, the Retail supplier and the consumers.

After going through the records and submission made by GRIDCO and the representative of CGPs and keeping in view the current difficult situation faced by the State as well as the recession experienced by manufacturers and the economy, the Commission in their order dated 28.02.2009 have delivered an interim order to enable harnessing of the available idle / bottled up capacity of CGPs at a reasonable price and keep the principal producing units in a sustainable mode while at the same time not burdening the users of electricity who are also hit badly by the recession.

While the CCPPO expects the price prevailing in the Indian Power Exchange and the price available through UI mechanism, it cannot be such as to burden all consumers with an unsustainable loading through higher price.

Considering all aspects in totality and adopting the principle of “live and let live” the Commission has directed that for supply of power by the CGPs/ Co-generating plants to GRIDCO for sale to DISTCOs meant for consumption by the consumers in the State, the procurement price of firm power from the CGPs will be Rs.3.00/ KWh with effect from 01.03.2009. However, to encourage co-generation as is mandated under the Electricity Act,2003 the power generated by co-gen. plants e.g. sponge-iron plants such as NINL, Arati Steel, Tata Sponge, etc. may be given an incentive and shall be paid at the rate of Rs. 3.10 per/KWh with effect from 01.03.2009. The procurement price of Rs.3.00 /KWh for all power meant for sale to DISTCOs is considered just and reasonable keeping in view the current cost of Rs.2.76/ KWh of the highest cost of generation from a TPS in the Eastern Region .A premium of about 10 % (ten percent) on this price is considered appropriate as a stimulus to the harnessing of bottled up capacity with the CGPs.

In order to encourage the CGP / Co-generating plants to fully utilize their bottled up capacity for generation of captive power/Co-generation power and to enable GRIDCO to access power from different sources including CGPs/Co-generating plants for meeting the demands in the State and making available a good quantum of power for trading, GRIDCO should offer a remunerative price to the CGPs in respect of power used for trading. Keeping in view the prevailing rate in the power exchanges, UI rate and price quoted in the bidding it would be just and equitable for GRIDCO and the CGPs and Co-generating plants to have an indicative rate of Rs.3.50 per KWh for procuring surplus power meant for trading. This is merely an indicative price suggested by the Commission, when, if they so like, the individual CGPs / Co-generating plants and GRIDCO may enter into further negotiation for an agreed price above this indicative rate.
“However, the procurement price by GRIDCO from the Captive Generating Plants/ Co-generating plants for the purpose of trading should not unduly vary from the indicative price of Rs.3.50 per KWh now being suggested by us as an interim measure”, the Commission has said.

After bridging of the gap in the ARR, the balance of surplus gained on account of trading of CGPs / Co-generation power may be shared with the CGPs/ Co-generation plants at the year end.

In respect of injection of inadvertent power the payment would be equal to the pooled cost of hydropower of the State during 2008-09 and 2009-10 as the case may be depending on the period of supply.

The rate of power indicated above will also be applicable with effect from 01.03.2009 to those CGPs/Co-generating plants having subsisting contracts/ agreements with GRIDCO. This will be without any prejudice to the outcome of any dispute/ arbitration pending in any court of law or any authority and will have no retrospective effect whatsoever.

The CGPs/Co-generating plants may be paid as per the rates indicated in the proportion of CGP/Co-generation power consumed inside the state and traded outside the state as certified Load Despatcher of SLDC in each month.

The Commission further reiterates that this is a common interim order and the arrangement is an interim implementation plan and would be operative from 01.03.2009.

After 30.6.2009 the Commission would review this arrangement as envisaged in Para 12.28 of the CGP pricing policy announced by the Commission in their order dated 14.3.2008.

But the State Government has failed to take advantage even of this order. Against power shortage of about 430MW at present, the injection of surplus power from the fifteen numbers of CGPs from 17.03.2009 to 21.03.2009 is only around 200 MW.

How long the State should bear with the wrong persons in right places?

POWER PROBLEM: WHAT THE HOUSE COMMITTEE COULD NOT SEE

Subhas Chandra Pattanayak

“Although Odisha is the first state to go for power sector reforms and is the only state where both transmission and distribution of electricity are privatized, yet, the achievements of the state availing uniform and qualitative power sector for a common man is not significant”, observes the Orissa Legislative Assembly Standing Committee formed to oversee the Department of Energy.

But it seems the House Committee is not aware of how the reform programme has been sabotaged.

In my column in Orissa’s mainstream broadsheet ‘Sambad’ I had exposed how payola had played a propellant role in Biju Patnaik’s decision to privatize power sector of Orissa, with specific stress on shenanigans involving AES and the foreign pack of advisors. In post Biju era, I had also exposed the rampant corruption, a part of which was being played by one Mahendra Kumar, the then Director, Commerce. Following the exposure, Mahendra Kumar had to go, but the anti-people activities of the new set-up went on, sufficiently as was being greased the relevant joints in the State secretariat.

Mr. Bishnu Das, Chairman of the Committee has not hesitated to transmit to the public that the Government should realize the futility of privatization and get rid of the private Distribution Companies (DISCOMs) in order to ward off anarchy in power sector. This idea may not stand the test on the matrix of Electricity Act, 2003. But there is no problem for the Standing Committee to probe and for the Government to act in the matter of loss caused to the State by way of subterfuge following privatization.

On 3rd of this month, AES has signed an MoU with Government of Chhatisgarh for setting up of a coal fired 1000 MW Project with an investment of Rs.5400 crores through AES India Pvt. Ltd. on Build, Own and Operate (BOO) basis. Upon operation, the proposed plant of AES will work as a Merchant Plant and would supply power to the power deficit States of the country.

In the light of observations of an astute power engineer, this is a death blow to Govt. of Orissa.

AES India holds 49% share in Ib Thermal Power Station of Orissa Power Generation Corporation along with management control since January 1999. It had earlier agreed to undertake installation of Unit-3 and 4 of ITPS at an estimated cost of Rs.1706 crore. By performing ‘Bhumi Puja’ for the purpose on 23rd August, 2004 at the request of AES India Chief Minister Naveen Patnaik tried to renew its credibility. Had he shown equal zeal for recovery of the dues claimed against AES, the GRIDCO could have gained a sum of Rs.645 crores. It is worth noting that AES India has already reaped the Dividend amount of Rs.449.22 crores by the FY 2004-05 from ITPS, whereas purchasing 51% of CESCO in September 1999, it had fled away on 27.08.2001, in the process, cheating GRIDCO of Rs.645 crores against which the later has lodged a claim on 08.02.2003. It is sad that the State Government does not show appropriate interest to defeat AES mischief.

This Company had earlier signed an M.O.U. with Govt. of Orissa and OSEB in 1992 for installation of 2×250 MW Thermal Plant at Ib Thermal Power Station. It has obtained all statutory clearances under First Track Power Project Scheme and concluded amended PPA with GRIDCO as successor to OSEB on 31.03.1997 for an investment of Rs.2369 crores. But this project has deliberately been kept dormant.

Look at it from any angle as you like, it would transpire that AES India is playing hide and seek with the people of Orissa. In such a situation a responsible and alert Government should have taken over the 49% share of OPGC from AES and should have assigned the Project to other developers showing Expression of Interest (EOI). But, by conducting ‘Bhumi Puja’, Chief Minister Naveen Patnaik has indicated that he can side with fraudulent players, happen what may to the simple people of Orissa.

The Standing Committee has legitimate scope to read this mischief. Let us hope against hope that it acts.

However, AES India is not by itself the entirety of the fraud that has affected Orissa’s power sector. A section of IAS officers and their cronies in sensitive places of administration have forced Orissa into a condition of recurring loss, in order only keep alive a scope for AES to benefit from power crisis. Let us go to the point.

In 1997, NTPC requested GRIDCO to avail 700 MW power at the rate of 35% of 2000 MW from their Talcher Super Thermal Power Project Stage-II (TSTPS Stage-II) at Kaniha near Talcher.

Senior IAS officer M.Y.Rao was then the CMD of GRIDCO. He constituted a committee comprising the aforesaid Mahendra Kumar, the then Director (Commercial), Sri Rama Ballav Mishra, the then Director (Finance) and Sri B.C. Jena, the then Director (Transmission and Distribution) of GRIDCO, who is presently a Member of Orissa Electricity Regulatory Commission, to decide whether GRIDCO should avail this Power.

This Committee decided not to avail the 700 MW power offered by NTPC under the plea that the exact Tariff and exact Schedule date of completion of NTPC Units were not available.

Whether the plea was cooked up keeping in mind the interest of Private Developers like AES and KPCL etc. or not can be ascertained by a body like the Standing Committee of the Assembly.

But, it needs no specialization to understand that the above recommendation of the Committee debarred Orissa from gaining from the NTPC offer.

As the recommendation was adopted by Rao, GRIDCO had to intimate NTPC that it was not to avail 700 MW Power from TSTPS Stage-II. Consequent upon this, NTPC allotted this 35% (700 MW) power to Southern Region constituents like Andhra, Tamilnadu, Karnatak etc.on the premise of Infirm power at the rate of 50 Paisa/KWh and Commercial power at the rate of 160 P/KWh.

Date wise all the four Units of TSTPS Stage-II beginning from Unit-III entered into commercial operation with effect from 01 Aug 2003, 01 March 2004, 01 November 2004 and 01 Aug.2005 respectively.

It means, due to the suicidal recommendation of the Committee, Orissa lost procurement of power to the tune of 2453 MU (500 MW x 0.8 x 0.35 x 8.76 x 2) during 2003-05 at the cost of 50 P/KWh. If it would have traded the same infirm power, it would have done so at a prevailing market rate of 250 P/KWh. Money wise, it would have given a gain worth Rs.490 Crores to GRIDCO. Similarly, after commercial operation, Orissa would have gained 300 Paise on each Unit (Trading value 460 P/Unit / Cost of generation 160 P./Unit).

A mere mathematical calculation (700×0.8×8.76×3) suffices to say that the financial loss to Orissa on account of the recommendation of the Committee constituted by Rao and the cold calculated decision by the two IAS officers at the helm of affairs, one at GRIDCO and the other in the department of energy in Orissa’s Secretariat rejecting the offer of NTPC is not less than Rs.1470 Crores per annum.

The loss to our State is not limited to the above evidence. The lackadaisical manner in which the State is now run has been playing havoc with the power sector.

It is the policy of Govt. of India that the home State should get 12% free Hydel power from the Projects undertaken by Central Government Power Companies like NHPC, NEEPCO etc. Similarly, 10% of thermal power is given as home State quota from all NTPC Stations located in that State.

Orissa is in such hands that the Government is not demanding or claiming the legitimate share of 10% of generated power as Home State Quota from TSTPS Stage-II which is located in Orissa and thereby is loosing Rs.420 Crores over 200 MW annually (calculated at 200×0.8×8.76×3) considering the prevalent trading price of 460 P/Unit.

Standing Committee of the Assembly could not see this scenario.

But it would be somewhat rectifying the mistake if the Assembly, while taking up energy budget, pays attention to the precarious position of power that is now menacingly threatening Orissa.

Although endowed with 23% of the Country’s power grade coal and 10% of annual surface water flow, Orissa will fall far short of the minimum requirement of power in 2007. I have already shown reasons to say that it portends a power-famine from the year 2009 onwards.

If the Assembly can compel the Government to constitute a Task Force in the pattern of War Council functioning during war time to go for and start immediately 3 to 4 Super and Mega Thermal Power Projects and at least one Ultra Mega Thermal Project (4000 MW), the dark days could be avoided.

But can it? Are there enough members in the treasury bench to drag out their Government from its bureaucratic cocoon into the world of activities, in interest of the people?

I leave the answer to whosoever watches the Assembly when energy demand is taken up.