‘ACHHE DIN’ FOR POWER SECTOR?

India is going to witness the biggest election in world history – the Lok Sabha Elections 2019 commencing 11th April. The political parties, eyeing to sweep the polls, will go for ‘high-voltage campaigning’ by holding multiple rallies in their attempt to woo the voters in their favour. Generally, it is observed that the demand for electricity goes up whenever India approaches general elections primarily due to intensive audio-video campaigning, rallies, and lighting of signages etc.

Further, the 12th edition of annual cricket extravaganza Indian Premier League (IPL) is on! The matches mostly played at night result in consumption of huge volume of electricity by powering floodlights, giant screens and sound systems in stadiums across the country. Also, a large number of cricket-crazy fans watch the tournament live sitting in front of the television for long hours with air-conditioners on. This again increases power consumption.

The above two mega ‘events’, even if short-term, signal good news for the power sector which is plagued by over-capacity and low demand.

Of late, the government has approved a slew of measures to provide the much-needed boost for the domestic power sector. It has cleared 3,760 MW projects worth Rs 31,560 crore to deal with stressed assets.

In order to revive the hydro power sector, especially to attract private participation in the sector, the Cabinet has approved renewable status for large hydro power projects of over 25 MW.

On the coal availability front, the Cabinet has approved coal linkages for short-term power purchase agreements (PPA) and allowed companies continue to have coal linkages even if PPAs are terminated due to payment default.

The above initiatives will provide a breather to the Indian power sector that is facing multiple headwinds. So, ‘Acche Din’ (good days) are here, though in the short term.