‘We are able to meet the power demand, it’s just the question of the last 500-700 MW’: Maharashtra energy dept secretary

Arvind Singh, Principal Secretary, state energy department, talks to The Indian Express about the shortage and the state’s plans for stepping up its production from renewables.

Written by Priyanka Sahoo | Mumbai | Updated: October 15, 2018 2:28:58 am
Arvind Singh says the state is doing well in terms of wind and bagasse-based power generation. (Express photo by Prashant Nadkar)

The state is reeling under a power shortage amid rising demand and the state distribution company began its first round of load-shedding last week.

Currently, the state distribution company is carrying out load-shedding across the state. It is learnt that there is a coal shortage across the country and the situation has not improved. So, when can consumers expect relief?

We catered to peak demands of over 24,000 MW this summer. Currently, coal stocks with the state generation company and independent power producers are low. We saw a spike in demand in the months of September and October and the reasons are higher temperatures and increased agricultural pumping. So we have crossed the 20,000-MW threshold for the state and we are able to manage all the loads and it is just the question of the last 500-700 MW.

We had a similar situation last year too. The basic problem is that during the monsoon there is water ingress in the coal mines. The level of mining activity or the amount of coal mined and transported goes down. So it takes sometime before they can catch up. We expect the situation to improve this week.

Arrears from the farm sector are mounting and the discom is struggling to recover the dues. How much are the arrears now and is there a specific recovery plan?

The arrears from agricultural consumers were Rs 25,586 crore against 39 lakh consumers at the end of June this year. The only way out is to recover those arrears and we will have to take up campaigns. We have been trying but there are always issues raised at various fora by those saying that there was improper billing or lack of receipt of bills. Ultimately, the answer is to recover the arrears. So I think we need to step up recovery and do it properly when the recovery climate improves.

How has the central government’s Ujwal Discom Assurance Yojana (UDAY) panned out for Mahadiscom?

Under UDAY, the Maharashtra government has approved taking over 75 per cent of Mahadiscom’s short- and medium-term loans and issued bonds of Rs 4,959.75 crore at an interest rate of 7.36 per cent per annum. This bond has been transferred to the Mahadiscom as state loan, which will be converted into grants from the government in five equal annual installments of Rs 991.95 crore each. The interest on outstanding loan is paid by the Mahadiscom to the state government every six months. The reduction of interest cost on account of the scheme is Rs 83.09 crore per annum. The state is on track to achieve the financial and loss-reduction trajectories agreed upon under the MoU.

The government in Maharashtra has taken over only short- and medium-term loans. It hasn’t taken over the long-term loans. It was a conscious decision and a good decision in hindsight because state finances have been adversely affected wherever long-term liabilities have been taken over.

Where does Maharashtra stand in terms of production from renewable sources?

In terms of renewables, we are strong in terms of wind and bagasse-based generation. In hydro, too, we have a significant capacity but in wind and bagasse we are one of the leading states. In the future, I see more investment happening in three categories – solar, wind and bagasse. Bagasse because we have a vibrant sugar industry. Wind because there is a favourable investment environment and now we have gone in for tariff-based bidding. We are now doing competitive bidding for renewable energy and that has reduced costs. We definitely started late on solar but that has helped because the costs have dropped. So, we will see significant addition in solar, specially in the next few years. Right now about 20 per cent of our capacity is from renewables (non-hydro) and 7 per cent from hydro. I think we will cross 30 per cent in renewable energy sources, apart from hydro in the near future.

What is the latest on the solar agriculture pumps scheme?

The first lot was for distribution of 10,000 pumps, of which we have rolled out 5,650. Then the central government gave us a target of 7,000 solar pumps. So we went to the cabinet last week and they have given us an approval. Both these schemes are centrally funded and the state takes only a part of the financial burden. The cabinet has directed us to scale up the programme over the next few years, using state resources. To raise it from state resources, obviously, we will have to levy that additional tax on sale of electricity (TOSE). We are working out the financials for that, keeping in mind that the tariff shock is not very high.

Are there plans to have a separate solar grid for agricultural consumers?

We are basically decentralising the system. Two pilot projects of 2-MW each are operational now and have been connected to the grid. One is at Ralegan Siddhi in Ahmednagar and we are studying the results there. The other one is at Kolambi in Yavatmal. The idea is, we can use that to supply electricity during the day. From the lessons of these two projects, we are planning to scale it up and we are now in the process of starting work on about 500 MW by Genco and 500 MW by the discom. In the next one year, we should see significant progress towards completion of such decentralised solar projects.

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