JOHANNESBURG, Feb 17: Private power generation companies were now leading in generating additional capacity in India, but were being hampered by a number of factors, according to an Indian businessman.
Venerable Energy Solutions Managing Director Mayank Garg said financial difficulties at the state-owned distribution companies were a serious threat to India’s huge power demands.
Speaking at the South African Coal Exports Conference, Garg said the deregulation of the sector had led to private companies generating additional capacity, but one of their primary challenges was getting sufficient coal supplies.
Although India has vast coal deposits, it imports a substantial amount of its needs, including from South Africa.
Garg said the financially-constrained state-owned distribution companies were reluctant to sign long term deals with private power generators who did not have their own coal mines, which in turn reduced the ability of these companies.
A lack of finance at the distributors also greatly impacted on their ability to invest in new infrastructure and maintenance, and to buy power from other generators.
Other factors were using power as a political instrument, such as the agricultural sector getting free power; as well as lack of control over theft, which was as high as 50 per cent in some instances. But it was not all gloom and doom in the Indian power sector, he said.
Garg said the new government had introduced a number of initiatives which could assist, including setting new targets for domestic coal production and speeding up administrative processes for adding new capacity.
Participants at the conference drew parallels between the power challenges in India and South Africa, where the embattled national distributor Eskom has had to implement large-scale load-shedding countrywide in recent weeks due to a lack of capacity to meet demand. (PTI)
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