POL­ICY BACK­FIRES

Down to Earth - - EDITOR’S PAGE -

POL­ICY IS per­verse. Re­ally un­think­ably so. I said this be­fore. I want to re­peat and ex­pand my rea­sons why. Ear­lier, I wrote this in the con­text of how pol­icy ended up pro­mot­ing the use of dirty and ex­tremely pol­lut­ing fu­els in the re­gion sur­round­ing Delhi, even as we all shouted and howled to get rid of deadly air pol­lu­tion. But this is not the full ex­tent of the per­ver­sity of pol­icy. There is more.

But first a quick re­cap. Last few months, con­cerned about grow­ing air pol­lu­tion in our cities, I was look­ing at pos­si­ble sources of emis­sions in the air. Our in­ves­ti­ga­tions re­vealed that ex­tremely high-sul­phur fuel—both fur­nace oil and pet coke—was be­ing widely used in the Na­tional Cap­i­tal Re­gion (ncr). Why? Be­cause it was cheaper than the avail­able al­ter­na­tives, nat­u­ral gas and elec­tric­ity. Pol­icy en­sured this hap­pened. While nat­u­ral gas was taxed, fur­nace oil was not. Pet coke, which has over 70,000 ppm of sul­phur as against 50 ppm in diesel, is ab­so­lutely free of any con­trol on its qual­ity, use and im­port. It is busi­ness of pol­lu­tion, as usual.

Then we also found that Delhi had is­sued a no­ti­fi­ca­tion on what were ac­cept­able fu­els, thus, tech­ni­cally ban­ning the use of high-sul­phur fu­els in its ter­ri­tory. But this was not done for ncr, so the use of high-sul­phur fu­els there pol­luted the com­mon air­shed. Th­ese find­ings are now be­ing de­lib­er­ated by the ever-re­luc­tant gov­ern­ment.

But this, as I said, is not all we found. This re­gion within a ra­dius of 100 km from Delhi, which is its com­mon air­shed, has some 8,588 MW of in­stalled ca­pac­ity of coal and gas power plants. This is enough to power its in­dus­tries. And while coal-based plants are much more pol­lut­ing than nat­u­ral gas-based plants, they are def­i­nitely cleaner than fur­nace oil or pet coke. Fur­ther­more, it is “tech­ni­cally” pos­si­ble and even “fea­si­ble” to con­trol emis­sions from the five coal power plants in Delhi, Dadri in Ut­tar Pradesh and Jha­j­jar in Haryana. Then what’s the prob­lem?

The fact is th­ese power plants are work­ing at some 20 per cent of their in­stalled ca­pac­ity. Yes, you read me right. There is so much in­stalled ca­pac­ity in the re­gion, that we should have had no elec­tric­ity fail­ure and cer­tainly no need to use dirty fu­els. This is why we need to un­der­stand how pol­icy is driv­ing us to­wards pol­lu­tion.

Let’s start with coal-based power, which is bet­ter than fur­nace oil or pet coke. There is some 5,345 MW of in­stalled ca­pac­ity in the im­me­di­ate vicin­ity of Delhi. Of this, only 19 per cent is be­ing used. What is worst is that the old­est and the most pol­lut­ing of th­ese plants are be­ing run. Why? Be­cause un­der the cur­rent merit or­der dis­patch pol­icy of the gov­ern­ment, the cheap­est power is what is first sup­plied. This means the older plants, which have de­pre­ci­ated their cap­i­tal, have the low­est fixed costs. This is what sells.

The sta­tion heat rate (shr) is a good way to know the pol­lu­tion po­ten­tial of power plants. It is the mea­sure of ef­fi­ciency as the low­est heat rate means less amount of fuel con­sumed to get the same amount of en­ergy. The shr of Delhi’s Badarpur plant (over 30-year vin­tage but sup­pos­edly re­fur­bished) is as high as 2,750 kCal/kWh; that of Dadri 1 (also close to 20 years old) is 2,450 kCal/kWh. Against this, the shr of three newer coal-based power plants— Dadri phase 2, Aravalli Power of ntpc and China Light and Power, both in Jha­j­jar—is in the range of 2,300 kCal/kWh. But un­der the cur­rent pol­icy, there is no ad­van­tage to cleaner, more ef­fi­cient plants. Even if th­ese burn less coal and emit less pol­lu­tion, their fixed costs are marginally higher and so th­ese plants are not op­er­ated.

First, dirt­ier fur­nace oil and pet coke get the ad­van­tage over cleaner power plants. Sec­ondly, dirt­ier coal power gets the ad­van­tage over cleaner coal power. Thirdly, pol­icy is blind enough to al­low for in­cen­tives to dirt­ier coal against cleaner nat­u­ral gas. This is re­ally the race to the bot­tom.

Now look at the shr of nat­u­ral gas-based Bawana plant in Delhi. Against Badarpur’s 2,750 kCal/kWh, Bawana plant’s shr is 1,845 kCal/ kWh. This makes it much bet­ter than Badarpur and even the clean­est coal-based power plant. Even in terms of emis­sion stan­dards, gas plants have lower pol­lu­tion—no par­tic­u­lates; neg­li­gi­ble sul­phur ox­ides (SOx) and low nitro­gen ox­ides (NOx).

Yet the Bawana plant is hardly op­er­a­tional. Ei­ther gas is not avail­able or the price is marginally higher or there is just so much dirty fuel avail­able that gas does not stand a chance. Pol­icy is de­signed for this. Fur­nace oil or pet coke is not taxed: im­ports are not charged; there is no coal cess on pet coke or any state vat or tax. As against this, ev­ery pos­si­ble tax is im­posed on gas. The dirt­ier the fuel, the more the in­cen­tives.

Now tell me pol­icy is not per­verse. Tell me that in this sit­u­a­tion, your lungs have a chance to sur­vive. Tell me I am wrong. Please.

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