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The transmission sector may impede India's efforts for economic growth due to a mismatch with 120 projects delayed by difficulties in obtaining right of way and forest clearance, according to a report by the Federation of Indian Chambers of Commerce and Industry (Ficci) and consultancy firm Booz and Co.
The report, titled Power Transmission: The Real Bottleneck, released on Friday said the transmission sector has "emerged as one of the primary obstacles in the country's efforts to overcome power shortages which currently entail a GDP (gross domestic product) loss of US$ 68 billion or 0.4% of GDP."
This comes in the backdrop of India's worst blackout last summer that left nearly 620 million people without electricity. On 31 July 2012, the northern grid collapsed, and the next day, in a wider blackout, the northern, eastern and north-eastern grids broke down.
Grid collapse is the worst-case scenario for any transmission utility-when this happens, states that draw power from a particular network go without electricity.
The report said efficient planning will bring down the commissioning period to 40 months, reducing the concentration of excessive projects to a single state-owned entity-in this case, Power Grid Corp. of India Ltd (PGCIL)-and incentivizing the use of modern technology.
The report added that PGCIL is severely overburdened with more than Rs.1.2 trillion projects and takes an average six years to complete a project. "Every single transmission line in the country will get delayed," said Pratik Agarwal, chairman of the Ficci task force on power transmission.
However, a top PGCIL executive requesting anonymity said, "It's very easy to blame Power Grid. Who is executing these projects better than us and on time?"Some of the other suggestions made by the report include creating a level playing field for private participants with PGCIL in terms of forest clearance and role in planning, adequate redressal mechanism, stringent qualification norms, and simpler exit norms.
The report pointed out that in the last five years, while power generation capacity has grown by 50%, transmission capacity has only increased by 30%.
Going forward, the projected capacity addition of 88,000 megawatts (MW) in the 12th Plan period (2012-17) will require an addition of 90,000 circuit km (Ckm) of 765-220 kV lines, 154,000 MVA of sub-station capacity and 27,350MW of national grid capacity.
Of the overall investment of $35 billion required in the sector, $19 billion is expected to be ploughed by PGCIL, with the balance by private utilities."The need is too large for one single company to do-be it public limited or a private one," added Agarwal, who is also head of infrastructure business at Sterlite Technologies Ltd.
India has a power generation capacity of 225,133.10MW with a demand of 135,000MW.
"Current power system is overburdened with 30 of its key transmission lines (3,000Ckm) severely overburdened, requiring immediate capacity augmentation," the report said.
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