Industry seeks greater participation in UP energy sector

In the backdrop of acute power shortage in Uttar Pradesh, industry has sought greater participation in the energy sector of the state encompassing both generation and distribution.

According to the Industry, the industrial sector growth had been badly hit owing to power shortage and unscheduled load-shedding, whereas in order to sustain future growth, the state must augment its power generation capacity with the help of privatisation.

Associated Chambers of Commerce and Industry of India (Assocham) has urged the UP government to support private agencies to exploit renewable energy sources like water, sun, biogas and wind to tide over the power crisis in the state.

It noted that Uttar Pradesh was facing power shortage of 20 per cent impeding industrialisation in both urban and rural pockets. According to available statistics till January 31, 2010, the total installed capacity of the state stood at 9,535 Mw, of which 4,621 Mw was contributed by the state government and the Centre contributed 4,368 Mw and barely 545 Mw was the contribution of the private sector. Power generation in the state is through coal (6,613 Mw), hydro (1,597 Mw), gas (550 Mw), nuclear energy (204 Mw) and renewable sources (571 Mw).

Of late, however, Uttar Pradesh had adopted the memorandum of understanding (MoU) route to rope in private bodies to set up thermal power plants. On November 30, UP Rajya Vidyut Utpadan Nigam signed an MoU with Neyveli Lignite Corporation to set up a 2,000 Mw thermal power plant at Ghatampur, Kanpur. The Rs 10,000 crore project entails acquisition of 2,500 acres of land. The state will get 75 per cent of the power generated, subject to the central electricity regulatory commission’s nod.

In recent months, the state has signed MoUs for power projects totaling 10,000 Mw, while work has already started in three other projects at Bara, Karchhna and Meja totaling 4,600 Mw, UP Power Corporation Limited CMD Navneet Sehgal had earlier said. In its report, Assocham also recommended the state to create a renewal fund for private players in power sector.