India Today

What has triggered the current crisis and what can be done to pre-empt it next time? THE WAY OUT...

- Source: NITI Aayog; PRS Legislativ­e Research


➘ COAL SHORTAGE India gets 60 per cent of its electricit­y from coal. Average coal stocks fell to nine days in midApril, the lowest in eight years and lower than the government-mandated average of 24 days’ stock. As per the coal directory 2020-21, India was the second largest importer of coal, mainly from Indonesia, Australia, South Africa and the US. We imported 215.3 million tonnes in 2020-21, 248.5 MT in 2019-20 and 235.4 MT in 2018-19.

➘ HIGH AT&C LOSSES Though power minister R.K. Singh informed Parliament that aggregate all-India AT&C losses reduced from 23.7 per cent in FY16 to 21.8 per cent in FY20, our aggregate technical and commercial losses remain among the highest in the world. Technical loss is the energy lost when electricit­y is carried over wires, aggravated by poor equipment. Commercial losses are caused by theft and pilferage of power. While 18 discoms witnessed a decline in losses, 12 saw a rise. This loss is the percentage of power procured by the discom for which it did not receive any payment.


Consumers across different categories pay different prices for power. An industrial consumer pays the most, a farmer the least. The tariff varies from over a rupee per unit to nearly Rs 8 per unit. BLEEDING DISCOMS Weighed down by differenti­al tariff, longterm power purchase agreements (PPAs) and unpaid dues, discoms cannot invest in superior networks and paying dues


➘ Rajasthan, Andhra Pradesh, Gujarat, Karnataka and Maharashtr­a have reduced leakages by separating feeders for agricultur­e use. Discoms can reduce power procuremen­t costs by encouragin­g farmers to instal meters on every farm and ensuring benefits go directly to them

➘ Incentivis­e consumers to meet part of their load via renewable energy. They can monetise their rooftops and sell the excess to discoms. Adequately compensate discoms for expenses to integrate rooftop solar power generation

➘ Discoms must be pushed to bring down cross subsidies to 20 per cent of power purchase cost

➘ Pay dues, especially by government bodies

➘ Find quick resolution to disputes between discoms and plants based on imported coal

➘ Rationalis­e multiple levies on coal—royalty on basic price (14%), GST (5%) and GST Compensati­on cess (Rs 400 per tonne). Its transporta­tion, too, is expensive as rail freight charges cross-subsidise passenger transport.

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